Precertification
Definition
Precertification is the process of obtaining advance approval from an insurance payer before a scheduled service. The terms "precertification" and "prior authorization" are used interchangeably by most payers. Technically, precertification confirms coverage eligibility while prior authorization confirms medical necessity — but in practice, both involve the same submission and review process. Failure to precertify results in denial under CO-197.
Why Precertification Matters
Precertification failures are among the most common preventable denials. A single missed precertification can cost $500 to $5,000+ depending on the service. Surgical procedures, advanced imaging (MRI, CT, PET), and specialty medications are the most common precertification requirements. Check the payer's precertification list before scheduling any service.
How Precertification Works
The provider submits clinical documentation to the payer (via portal, phone, or fax) before the scheduled service. The payer reviews and issues an authorization number if approved. Include the authorization number on the claim. CMS rule CMS-0057-F requires payers to provide precertification decisions within 72 hours (expedited) or 7 days (standard) starting January 2026. See prior authorization rules.
Related Terms
Prior authorization — used interchangeably with precertification. Authorization number — issued upon approval. Medical necessity — the basis for precertification decisions. Claim denial — the result of missing precertification.
Common Questions
Is precertification the same as a referral?
No. A referral is a direction from one provider to another. Precertification is an insurance requirement for coverage approval. Some plans require both — a referral from the PCP and precertification from the payer — for specialty services.
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This glossary is for informational purposes. Consult official billing guidelines and payer policies for definitive definitions. Last updated: 2026-04-06.