Why might precertification impact coverage?

• A. It confirms medical necessity and helps ensure benefits are payable; without precertification, coverage may be reduced or denied.
• B. It increases premiums
• C. It reduces the policy term
• D. It affects only cosmetic coverage

Answer: (A)

Precertification, or prior authorization, is the process an insurer uses to review a proposed medical service before it’s provided to decide if it’s medically necessary and covered under the plan. When precertification is obtained and approved, the service is typically eligible for benefits and will be paid according to the policy’s terms. If precertification isn’t obtained or is denied, the insurer may pay a reduced amount or deny coverage entirely, leaving the patient responsible for more of the cost. So precertification affects coverage by ensuring the care meets medical necessity and plan rules before it happens. It doesn’t change premiums or the policy term, and its main purpose isn’t cosmetic coverage but to confirm what the plan will pay for a given service.