Are We Still Using Pink Slips?

About 20 years ago, soon after I started my new job as the Managed Care Medical Director for a multispecialty group in Northern California, this cautionary event took place. Once a month I presented a formal report to our board of directors. The board wanted to know how we were doing in our HMO business, because, at that time, half of our patients were in those programs. The report detailed (1) our relationship with our insurance company partners; (2) where and how much of our HMO work was being sent out of our system; and (3) how easy it was for our physicians and patients to obtain needed authorizations. The report was filled with charts, graphs, and lots of financial data. My team and I put a lot of time and effort into making sure that the Board Report was accurate and up to date. The report was sent to the board members in advance of the meeting, and I was at the meeting to answer questions.

At these meetings, most of the questions revolved around how we could provide the most services for our patients within our system. And, as usual, the board members’ questions were about this topic. I was just about ready to finish my report when a pediatrician board member asked me if we were still using the “pink slips” for authorizations. To put this into context, this was before we went to an online authorization system. In the past, the physicians faxed the request to Managed Care. The Managed Care staff entered the request into the system. The request was reviewed and acted upon. The Managed Care system printed out several copies of the determination, one of which was sent back to the physician on a pink-colored sheet of paper. It didn’t take long for the authorization determinations to come to be called “pink slips.”

I told the board that our process had not changed and that we were still using the pink slips. I asked the pediatrician board member why he was asking, and he told me that he had not received any pink slips in the past week. I told him that that seemed odd and that I would check into it.

I left the board meeting, returned to the Managed Care office, and went to find the Nurse Manager. I asked her, “Are we still using the pink slips?” She answered, “We are. Why do you ask?” I told her that I had just been to the board meeting and that one of the physician board members told me that he had not received any pink slips in the past week. So the two of us went to find the supervisor of the Managed Care clerks. I asked her, “Are we still using the pink slips?” She answered, “Yes, we are. Why are you asking?” Once again I told the story of the board meeting. She said, “Well, let’s find the clerk who handles the printouts.” This was a job given to the most junior clerk, because it was considered a task that did not require any knowledge of how authorizations were processed. It was a purely mechanical task. The three of us, Medical Director, Nurse Manager, and Supervisor, walked to the back of the office where the printers were chugging out the authorization determinations and found the clerk, who had only been on the job for two weeks. We asked her, “Are we still using the pink slips?” She said, “Oh, the pink slips—nobody told me what to do with them, so I’ve been throwing them away.” Fortunately, she was sending the patients their copies, so no harm was done. It was just an inconvenience to the physicians’ offices, which had to call to get information on their authorization requests.

This episode became a cautionary tale for the entire organization on how easily a complex system can fail when we do not put in the time to train all the staff. I also realized that I did not understand how things got done. This led to our first process flow project and eventually to the development of an online authorization process.