What is the purpose of prior authorization in healthcare?

The purpose of prior authorization in healthcare is primarily to prevent unnecessary expenses for insurance providers and ultimately for patients. This process involves the health insurance company reviewing the medical necessity of certain tests, procedures, or medications before they are carried out to ensure that they meet specific criteria established by the insurer. By doing so, prior authorization helps control healthcare costs by ensuring that only necessary and appropriate services are utilized, thus minimizing the risk of high expenditures on treatments that may not be effective or necessary for the patient’s condition.

While ensuring coverage for medications, streamlining patient visits, and allowing doctors to prescribe freely may be associated with various aspects of healthcare, they do not fully encompass the central role of prior authorization. Prior authorization specifically aims to manage costs and avoid inappropriate use of healthcare resources, which aligns with the correct answer provided.