Automating prior authorization packet assembly can cut the staff time each authorization takes and reduce avoidable denials from incomplete packets, and the savings scale with your monthly volume. You can estimate your own number with three inputs: monthly authorizations, minutes spent building each packet, and loaded staff cost per hour, plus the cost of denials and delays.
What does prior authorization packet assembly cost you today?
Most practices have never measured it, so start there. The AMA's 2024 prior authorization survey found physicians and their staff complete an average of 39 prior authorizations per week, spending about 13 hours a week on them. It also found that 40 percent of physicians employ staff who work exclusively on prior authorization.
That figure is per physician. For a mid-to-large independent practice, the work adds up to full-time positions. If your group has 15 physicians, the AMA average suggests roughly 195 hours of prior auth work a week, which is close to five full-time equivalents. Treat that as a ceiling for orientation, not a prediction for your practice. Your own numbers will differ, and the next section shows how to find them.
How do you calculate your own savings?
Use a simple framework with four parts. Every input should come from your own records.
Part 1: Staff time on packet assembly. Monthly authorizations × minutes to assemble each packet × loaded hourly staff cost.
Part 2: Cost of incomplete packets. Requests that come back for more information, multiplied by the extra touches and the time each takes.
Part 3: Cost of denials and delays. Denials that trace to missing documentation, multiplied by the cost to appeal or resubmit, plus any revenue lost to delayed or abandoned care.
Part 4: Cost of the tool. Subscription or per-request fees, implementation effort, and the staff time to review and handle exceptions.
Your net savings is parts 1 through 3, reduced by the share the tool actually removes, minus part 4.
An illustrative example
The numbers below are an example only, not a benchmark. Swap in your own.
Say a practice files 600 authorizations a month, and coordinators spend 20 minutes assembling each packet. That's 12,000 minutes, or 200 hours a month. At a loaded cost of $30 an hour, that's $6,000 a month in assembly time.
If software cuts the hands-on time to 6 minutes per packet, mostly review and exceptions, the same volume takes 60 hours. That frees 140 hours a month. At $30 an hour, the labor value is $4,200 a month, or $50,400 a year, before counting denials.
Now double the volume to 1,200 authorizations and the freed time doubles too. That's the scaling effect: savings grow with volume while many costs stay fixed.
How do denials and delays change the math?
Staff time is the easy part to count. Denials and delays are harder, and they often matter as much.
An incomplete packet causes a second round of work. The payer asks for more information, the case reopens, and someone repeats part of the process. If a denial follows, an appeal takes more time again.
Track these for 60 to 90 days before you change anything: the share of requests that go out complete on first submission, the number of additional-information requests, denials tied to missing documentation, and days from order to submission. Software that checks completeness before submission targets exactly these numbers.
Be careful about claiming a precise reduction up front. Results vary by payer mix, procedure mix, and documentation habits. Use your own baseline and measure the change after a few weeks of live use.
What drives the cost of implementation?
Four things move the price and the effort:
- Volume and number of providers. Pricing models vary: per packet, per request, per provider, or a platform fee.
- EHR connection. Some integrations are quick. Others take longer, and your IT team's time counts as a cost.
- Payer and procedure scope. Starting with your top payer and procedure pairs keeps the first phase small.
- Review and exception handling. Software doesn't remove staff. Plan for people to review packets and handle gaps.
Ask each vendor for a quote based on your real monthly volume, and ask what happens to the price as volume grows. Honey Health's Prior Authorization agent is one option to price this way, alongside others.
How long until it pays back?
Payback depends on volume and on how much of the work the tool removes. A practice with a few hundred authorizations a month and a long assembly time per packet will usually see the case faster than one with low volume and quick packets.
A useful test is the breakeven: divide the monthly cost of the tool by your loaded hourly staff cost. That tells you how many staff hours per month the tool has to save to pay for itself. If your illustrative savings from the prior section are many times that number, the case is strong. If they're close, the soft benefits and denial reductions matter more.
Run a pilot on your own data before you commit. A short test on real packets, under a business associate agreement, replaces assumptions with your actual minutes per packet.
Where do the savings come from, line by line?
It helps to separate the sources, since they behave differently as you grow.
Labor on assembly. This is the biggest and most predictable line. Every minute a coordinator doesn't spend searching a chart, matching a fax to a patient, or reformatting a document is a minute available for something else. Whether that becomes a smaller headcount, avoided hires, or capacity to clear a backlog is a business decision for you.
Rework on incomplete packets. Every packet that bounces back for missing information costs more than the first pass did, because staff have to reopen the case, find the missing item, and resubmit. Catching the gap before submission turns a three-touch task into a one-touch task.
Denial and appeal work. Denials that trace to missing documentation are avoidable. Each one you prevent saves the appeal effort and avoids the delay to patient care. Denials caused by clinical disagreement aren't avoidable by software, so keep them out of your estimate.
Delay costs. A day saved between order and submission is a day sooner the patient gets care and the practice gets paid. This is the hardest line to price, so many administrators track it as a metric and leave it out of the dollar estimate.
What should you measure before you start?
A good ROI case rests on a baseline you can defend to your partners or your board. Spend two to four weeks collecting these numbers from a real sample:
- Volume. Authorizations per month, by payer and by procedure.
- Time. Minutes of staff time per packet, sampled from two or three coordinators.
- Completeness. The share of requests that go out complete on first submission.
- Rework. How many come back with additional information requests.
- Denials. How many trace to missing documentation, and how long each takes to resolve.
You don't need perfect data. A rough sample is far better than a guess, and it gives you the "before" half of the comparison.
What mistakes make ROI estimates wrong?
Most inflated business cases share the same few flaws.
- Assuming zero review time. Staff still check finished packets and handle exceptions. Count that time on the software side of the ledger.
- Using vendor averages instead of your own. A vendor's case study comes from a different payer mix and different documentation habits. Use it as a prompt for questions, not as your number.
- Counting every denial as avoidable. Only denials tied to missing or incomplete documentation belong in the estimate.
- Ignoring ramp-up. The first few weeks include rule tuning and some corrections. Build a conservative first quarter into the plan.
- Forgetting that volume changes. If your authorization volume is growing, the savings grow too, but so might the fees if pricing is per request. Model both.
A simple safeguard is to present three scenarios to your partners: a cautious case, an expected case, and a strong case. Show the inputs for each so anyone can challenge them.
What soft benefits should you count?
Some benefits don't show up in a spreadsheet but still matter to the owners and administrators making the call.
- Less burnout. Prior auth paperwork is among the most disliked tasks in a front office. Moving staff from assembly to review helps retention, and turnover is expensive.
- Faster access to care. Patients wait less when packets go out complete on the first try.
- Provider time back. Fewer interruptions for missing documentation and fewer peer-to-peer calls driven by gaps.
- Better visibility. A tracked process shows which payers and procedures cause the most trouble.
Don't inflate these into dollar figures you can't defend. List them separately and let decision-makers weigh them.
Should you automate or hire more staff?
Hiring adds capacity in steps. Each new coordinator adds a salary, training time, and management load, and prior auth volume tends to grow faster than headcount. Automation adds capacity as volume grows, though it still needs people for review and exceptions.
A mixed approach is common: automate packet assembly, and keep your experienced coordinators on exceptions, denials, and payer relationships. The work shifts from assembly to judgment, which is where their experience counts most.
If you're deciding between the two, run both numbers through the framework above. Include recruiting and training in the hiring side, and include implementation and review time on the software side.
Frequently Asked Questions
How much time does automating prior authorization packet assembly save?
It depends on your current process. Measure minutes per packet before you start, then compare after a few weeks of live use. The savings come from software finding and compiling documents, with staff reviewing the finished packet and handling exceptions.
Does automation reduce prior authorization denials?
It can reduce denials caused by missing or incomplete documentation, because the software checks the packet against payer requirements before submission. It can't fix denials driven by medical necessity disagreements or missing clinical care.
How do I estimate ROI before buying?
Use your own numbers: monthly authorizations, minutes per packet, loaded staff cost, denial and resubmission counts, and the vendor's quote. Run a pilot on real requests to replace estimates with measured results.
Will automation replace my prior auth staff?
Most practices redeploy their staff. The work shifts from building packets to reviewing them and handling exceptions. Providers still sign letters of medical necessity and join peer-to-peer calls.
What costs should I include besides the software fee?
Include implementation effort, IT time for the EHR connection, staff training, and the time your team spends on review and exceptions. Also include payer rule maintenance if the vendor doesn't handle it.
