Prior authorization is a payer requirement that a provider get approval before delivering a service, so the payer confirms it will cover that service for the patient.
What it means
Before certain services are rendered, the payer requires the provider to request and receive approval. The provider submits clinical documentation, the payer reviews it against its coverage rules, and only then issues an authorization. Without it, the resulting claim is denied regardless of medical necessity.
Prior authorization adds time on both ends. The approval itself can take days or weeks before care can proceed, and the claim that follows still has to go through normal adjudication afterward. Each step pushes the eventual payment further out from the date the patient was actually seen.
This requirement is especially heavy in behavioral health, where many commercial payers require authorization for ongoing therapy and psychiatric services, and where re-authorization is needed to keep a course of treatment going.
Why it matters for your practice
For a practice owner, prior authorization is unpaid administrative work that delays paid clinical work. Your team spends hours securing approvals, then waits again for the claim to adjudicate after the visit. In behavioral health especially, that double delay can stretch the time from a delivered session to collected cash well past the point where rent and payroll are due.
How this relates to Copay
Copay does not remove the prior authorization step, but it absorbs the cash flow delay that follows it. Once an authorized service is billed and the claim is eligible, Copay purchases that claim and pays you the next business day instead of making you wait out adjudication. There is no change to how your billing team works and no personal guarantee.
Written by Eitan Glick, CEO, Copay Inc.
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