Prior authorization.
In plain English
Prior authorization (sometimes called pre-authorization or pre-certification) is when your health plan requires sign-off before it will pay for certain care. Your doctor sends the plan a request, and the plan decides whether the service meets its rules for coverage. It usually applies to expensive drugs, imaging like MRIs, planned surgeries, and some specialist care. If you skip the step when it is required, the plan can deny the claim and leave you with the full bill, even for care you genuinely needed.
01Why it matters
A missing prior authorization can turn a covered treatment into a bill you owe entirely, and approvals can take days, which can delay care you are waiting on.
02The math, step by step
Your doctor orders an MRI. Your plan requires prior authorization, so the office sends a request explaining why the scan is needed. The plan approves it, and the scan is covered as usual. If the office had not requested approval first, the plan could deny the claim and you would owe the full cost of the MRI.
03What this is NOT
Prior authorization is not a referral. A referral is your primary doctor sending you to a specialist. Prior authorization is the insurer approving that a specific service or drug will be paid for.
04Receipts
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Plain-English answers from our glossary. Receipts included. Never advice.
Educational tool. Answers come only from ClearMoneySchool's published glossary and are not advice. Why we never give advice