What is the primary purpose of prior authorization in formulary management?

• A. To ensure appropriate use and cost control
• B. To restrict all medications
• C. To speed up the approval process
• D. To alter premium amounts

Answer: (A)

Prior authorization is a utilization-management step in formulary management. It requires documentation of medical necessity before a medication is covered, ensuring that the prescribed therapy is appropriate for the patient and aligns with cost-conscious, evidence-based practices. This gatekeeping helps steer prescriptions toward clinically effective and value-based options, often incorporating step therapy or preferred alternatives when suitable. It’s not about restricting every medication or speeding up access; it can slow things down due to the extra review, and it has no bearing on premium amounts.