Bill Text: IA SSB1161 | 2017-2018 | 87th General Assembly | Introduced


Bill Title: A bill for an act relating to prior authorization by a utilization review entity for coverage of health care services and including applicability provisions.

Spectrum: Committee Bill

Status: (N/A - Dead) 2017-02-23 - Subcommittee: Shipley, C. Johnson, and Ragan. [SSB1161 Detail]

Download: Iowa-2017-SSB1161-Introduced.html
Senate Study Bill 1161 - Introduced SENATE FILE _____ BY (PROPOSED COMMITTEE ON HUMAN RESOURCES BILL BY CHAIRPERSON SEGEBART) A BILL FOR An Act relating to prior authorization by a utilization review 1 entity for coverage of health care services and including 2 applicability provisions. 3 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 4 TLSB 2464XC (4) 87 av/rh
S.F. _____ Section 1. NEW SECTION . 514F.7 Prior authorization. 1 1. Definitions. For purposes of this section: 2 a. (1) “Adverse determination” means a determination by 3 a utilization review entity that an admission, availability 4 of care, continued stay, or other health care service, other 5 than a dental care service, that is a covered benefit has been 6 reviewed and, based upon the information provided, does not 7 meet the utilization review entity’s requirements for medical 8 necessity, appropriateness, health care setting, level of care, 9 or effectiveness, and the requested service or payment for the 10 service is therefore denied, reduced, or terminated. 11 (2) For the purposes of denial of a dental care service, 12 “adverse determination” means a determination by a utilization 13 review entity that a dental care service that is a covered 14 benefit has been reviewed and, based upon the information 15 provided, does not meet the utilization review entity’s 16 requirements for medical necessity, and the requested service 17 or payment for the service is therefore denied, reduced, or 18 terminated in whole or in part. 19 (3) “Adverse determination” does not include a denial of 20 coverage for a service or treatment specifically listed in plan 21 or evidence of coverage documents as excluded from coverage. 22 b. “Authorization” means a determination by a utilization 23 review entity that a requested health care service has been 24 reviewed and, based upon the information provided, meets the 25 utilization review entity’s requirements for medical necessity, 26 appropriateness, health care setting, level of care, or 27 effectiveness, and that payment will be made for the requested 28 service. 29 c. “Clinical review criteria” means the written policies, 30 screening procedures, drug formularies or lists of covered 31 drugs, determination rules, determination abstracts, clinical 32 protocols, practice guidelines, medical protocols, and any 33 other criteria or rationale used by a utilization review entity 34 to determine the necessity and appropriateness of health care 35 -1- LSB 2464XC (4) 87 av/rh 1/ 12
S.F. _____ services. 1 d. “Covered person” means a policyholder, subscriber, 2 enrollee, or other individual participating in a health benefit 3 plan. “Covered person” includes a covered person’s legally 4 authorized representative. 5 e. “Dental care services” means diagnostic, preventive, 6 maintenance, and therapeutic dental care that is provided in 7 accordance with chapter 153. 8 f. “Emergency health care services” means health care items 9 and services furnished or required to evaluate and treat an 10 emergency medical condition. 11 g. “Emergency medical condition” means the sudden and, at 12 the time, unexpected onset of a health condition or illness 13 that manifests itself by symptoms of sufficient severity, 14 including but not limited to severe pain, that an ordinarily 15 prudent person, possessing an average knowledge of health and 16 medicine, could reasonably expect the absence of immediate 17 medical attention to result in a serious impairment to bodily 18 functions, serious dysfunction of a bodily organ or part, or 19 would place the person’s health in serious jeopardy. 20 h. “Facility” means an institution providing health care 21 services or a health care setting, including but not limited 22 to hospitals and other licensed inpatient centers, ambulatory 23 surgical or treatment centers, skilled nursing centers, 24 residential treatment centers, diagnostic, laboratory and 25 imaging centers, and rehabilitation and other therapeutic 26 health settings. 27 i. “Health benefit plan” means a policy, contract, 28 certificate, or agreement offered or issued by a health carrier 29 to provide, deliver, arrange for, pay for, or reimburse any of 30 the costs of health care services. 31 j. “Health care professional” means a physician or other 32 health care practitioner licensed, accredited, registered, or 33 certified to perform specified health care services consistent 34 with state law. 35 -2- LSB 2464XC (4) 87 av/rh 2/ 12
S.F. _____ k. “Health care provider” or “provider” means a health care 1 professional or a facility. 2 l. “Health care services” means services for the diagnosis, 3 prevention, treatment, cure, or relief of a health condition, 4 illness, injury, or disease provided by a health care provider. 5 “Health care services” includes dental care services and the 6 provision of pharmaceutical products or services or durable 7 medical equipment. 8 m. “Health carrier” means an entity subject to the 9 insurance laws and regulations of this state, or subject 10 to the jurisdiction of the commissioner, including an 11 insurance company offering sickness and accident plans, a 12 health maintenance organization, a nonprofit health service 13 corporation, a plan established pursuant to chapter 509A 14 for public employees, or any other entity providing a plan 15 of health insurance, health care benefits, or health care 16 services. “Health carrier” includes, for purposes of this 17 section, an organized delivery system. 18 n. “Medically necessary health care services” means 19 health care services and supplies that a prudent health care 20 provider would provide to a covered person for the purpose 21 of preventing, diagnosing, or treating a health condition, 22 illness, injury, or disease, or the symptoms of an illness, 23 injury, or disease in a manner that is all of the following: 24 (1) In accordance with generally accepted standards of 25 medical practice. 26 (2) Clinically appropriate in terms of type, frequency, 27 extent, site, and duration. 28 (3) Not primarily for the economic benefit of the health 29 benefit plan or health care provider or for the convenience of 30 the covered person or the health care provider. 31 o. “Organized delivery system” means an entity system 32 authorized under 1993 Iowa Acts, ch. 158, and licensed by the 33 director of public health, and performing utilization review. 34 p. “Prior authorization” means the process by which a 35 -3- LSB 2464XC (4) 87 av/rh 3/ 12
S.F. _____ utilization review entity determines the medical necessity 1 or medical appropriateness of otherwise covered health care 2 services prior to the rendering of such health care services 3 including but not limited to preadmission review, pretreatment 4 review, utilization, and case management. “Prior authorization” 5 includes a utilization review entity’s requirement that a 6 covered person or health care provider notify the utilization 7 review entity prior to receiving or providing a health care 8 service. 9 q. “Urgent health care service” means a health care service 10 subject to prior authorization prescribed for a covered 11 person, for which the time periods for making a nonexpedited 12 prior authorization, could, in the opinion of a health care 13 professional with knowledge of the covered person’s medical 14 condition, do either of the following: 15 (1) Seriously jeopardize the life or health of the covered 16 person or the ability of the covered person to regain maximum 17 function. 18 (2) Subject the covered person to severe pain that cannot be 19 adequately managed without the health care service that is the 20 subject of prior authorization. 21 r. (1) “Utilization review entity” means an individual or 22 entity that performs prior authorization for one or more of the 23 following entities: 24 (a) An employer with employees in Iowa who are covered under 25 a health benefit plan. 26 (b) A health carrier. 27 (c) Any individual or entity that provides, offers to 28 provide, or administers hospital, outpatient, medical, or other 29 health care services. 30 (2) “Utilization review entity” includes a health carrier 31 that performs prior authorization for its own health benefit 32 plans. 33 2. Prior authorization requirements and restrictions —— 34 disclosure. 35 -4- LSB 2464XC (4) 87 av/rh 4/ 12
S.F. _____ a. A utilization review entity shall make any current prior 1 authorization requirements or restrictions, including clinical 2 review criteria, readily accessible on the entity’s internet 3 site to covered persons, health care providers, and the general 4 public. The restrictions and requirements shall be described 5 in detail but in easily understandable language. 6 b. A utilization review entity shall not implement a new or 7 amended prior authorization requirement or restriction until 8 the utilization review entity has done both of the following: 9 (1) Updated the utilization review entity’s internet site 10 to reflect the new or amended requirement or restriction. 11 (2) Provided written notice of the new or amended 12 requirement or restriction not less than sixty calendar 13 days before the new or amended requirement or restriction is 14 implemented to health care providers contracted to provide 15 health care services pursuant to a health benefit plan to which 16 the prior authorization requirement or restriction applies. 17 c. A utilization review entity shall make statistics 18 available on the entity’s internet site in a readily accessible 19 format that indicate how prior authorization is applied on the 20 basis of each of the following: 21 (1) Specialty of the health professional. 22 (2) Type of health care service requested. 23 (3) The clinical indication offered for requesting a health 24 care service. 25 (4) Reason for denial of prior authorization. 26 3. Utilization review entity’s obligations with respect to 27 prior authorization. 28 a. If a utilization review entity requires prior 29 authorization for coverage of a nonurgent health care service, 30 the entity shall either give prior authorization covering the 31 nonurgent health care service or make an adverse determination 32 denying coverage of the nonurgent health care service within 33 five calendar days of obtaining all necessary information 34 to give authorization or make an adverse determination. A 35 -5- LSB 2464XC (4) 87 av/rh 5/ 12
S.F. _____ contractual timeline may vary from this standard but in no 1 event shall the timeline for giving authorization or making an 2 adverse determination for coverage of a nonurgent health care 3 service exceed five calendar days. 4 b. If a utilization review entity requires prior 5 authorization for coverage of an urgent health care service, 6 the entity shall either give prior authorization covering the 7 urgent health care service or make an adverse determination 8 denying coverage of the urgent health care service and notify 9 the covered person and the covered person’s health care 10 provider of that authorization or denial within seventy-two 11 hours of obtaining all necessary information to give 12 authorization or make an adverse determination. A contractual 13 timeline may vary from this standard but in no event shall 14 the timeline for giving authorization or making an adverse 15 determination for coverage of an urgent health care service 16 exceed seventy-two hours. 17 c. For purposes of this subsection, “necessary information” 18 includes the results of a face-to-face clinical evaluation or 19 second opinion that may be required. 20 4. Utilization review entity’s obligations with respect to 21 coverage of emergency health care services. 22 a. A utilization review entity shall not require prior 23 authorization for emergency transportation to a hospital or for 24 the provision of emergency health care services. 25 b. A utilization review entity shall allow a covered person 26 and the covered person’s health care provider a minimum of 27 twenty-four hours following an emergency hospital admission 28 or the provision of emergency health care services to the 29 covered person, to notify the utilization review entity of 30 the emergency hospital admission or provision of emergency 31 health care services. If the emergency hospital admission or 32 provision of emergency health care services occurs on a holiday 33 or weekend, the utilization review entity shall not require 34 such notification until the next business day after the holiday 35 -6- LSB 2464XC (4) 87 av/rh 6/ 12
S.F. _____ or weekend. 1 c. A utilization review entity shall authorize coverage 2 of emergency health care services necessary to screen and 3 stabilize a covered person. If a health care provider 4 certifies in writing to a utilization review entity within 5 seventy-two hours of a covered person’s admission to a hospital 6 that the covered person’s condition required emergency 7 health care services, that certification shall create a 8 presumption that the emergency health care services were 9 medically necessary and such presumption may be rebutted only 10 if the utilization review entity can establish, by clear and 11 convincing evidence, that the emergency health care services 12 provided were not medically necessary. 13 d. A determination of the medical necessity or 14 appropriateness of emergency health care services provided to 15 a covered person shall not be based on whether or not those 16 services were provided by a health care provider under contract 17 to provide health care services pursuant to a health benefit 18 plan. Requirements or restrictions on coverage of emergency 19 health care services provided by health care providers not 20 under contract to provide services pursuant to a health benefit 21 plan shall not be greater than requirements or restrictions 22 that apply when those services are provided by a health care 23 provider under contract to provide such services pursuant to 24 the health benefit plan. 25 e. If a covered person receives emergency health 26 care services that require immediate postevaluation or 27 poststabilization health care services, a utilization review 28 entity shall give prior authorization or make an adverse 29 determination within sixty minutes of receiving a request for 30 prior authorization. If the utilization review entity does not 31 give authorization for or deny coverage of the postevaluation 32 or poststabilization health care services within sixty minutes 33 of receiving the request, coverage of such services shall be 34 deemed to be authorized. 35 -7- LSB 2464XC (4) 87 av/rh 7/ 12
S.F. _____ 5. Retrospective denial. A utilization review entity shall 1 not revoke, limit, condition, or restrict prior authorization 2 after the date on which a health care provider provides the 3 health care services for which authorization was received. Any 4 language that attempts to disclaim payment for health care 5 services that have received prior authorization shall be null 6 and void. 7 6. Duration. A prior authorization shall be valid for 8 not less than one year from the date a health care provider 9 receives the prior authorization. 10 7. Expedited renewal. A utilization review entity shall 11 develop an expedited process for the renewal of an existing 12 prior authorization including a certification that the factors 13 constituting medical necessity or medical appropriateness 14 of the health care services for which renewal of prior 15 authorization is sought remain unchanged from the factors 16 that were considered before issuance of the original prior 17 authorization. 18 8. Administrative services fees. 19 a. A utilization review entity shall establish an 20 administrative services fee schedule for prior authorization 21 determinations, consistent with the federal Medicare 22 resource-based relative value scale methodology used to 23 reimburse health care professionals for medical reports. The 24 fee schedule shall be utilized by the utilization review 25 entity to determine the amount of payments to health care 26 professionals who complete administrative services required by 27 the utilization review entity as a condition of giving prior 28 authorization or making an adverse determination. 29 b. For the purpose of this subsection, “administrative 30 services” includes but is not limited to peer-to-peer 31 clinical consultations or second opinions, and completion of 32 certification documentation. “Administrative services” does not 33 include those services rendered by a health care professional 34 in the provision of health care services to a covered person. 35 -8- LSB 2464XC (4) 87 av/rh 8/ 12
S.F. _____ 9. Failure to comply with this section. Upon the failure 1 of a utilization review entity to comply with deadlines or 2 other requirements specified in this section, any health care 3 services subject to prior authorization shall be deemed to be 4 automatically preauthorized. 5 10. Severability. If any provision of this section or the 6 application of this section to any person or circumstance is 7 held invalid, such invalidity shall not affect other provisions 8 or applications of the section which can be given effect 9 without the invalid provision or application. 10 Sec. 2. APPLICABILITY. This Act applies to a health benefit 11 plan that is delivered, issued for delivery, continued, or 12 renewed in this state on or after January 1, 2018. 13 EXPLANATION 14 The inclusion of this explanation does not constitute agreement with 15 the explanation’s substance by the members of the general assembly. 16 This bill relates to prior authorization of health 17 care services by a utilization review entity and includes 18 applicability provisions. 19 The bill provides that a utilization review entity that 20 requires prior authorization for coverage of health care 21 services must make its prior authorization requirements or 22 restrictions readily accessible on its internet site. The 23 entity cannot implement new or amended prior authorization 24 requirements or restrictions until its internet site has been 25 updated and health care providers contracted to provide the 26 health care services to which the requirements or restrictions 27 apply have been given not less than 60 calendar days’ written 28 notice of the changes. A utilization review entity must make 29 specified statistics about application of prior authorization 30 available on its internet site. 31 If prior authorization is required for coverage of a 32 nonurgent health care service, a utilization review entity 33 must either give prior authorization to cover the service or 34 make an adverse determination denying such coverage within 35 -9- LSB 2464XC (4) 87 av/rh 9/ 12
S.F. _____ five calendar days of obtaining all necessary information. 1 If prior authorization is required for coverage of an urgent 2 health care service, a utilization review entity must give 3 prior authorization to cover the service or make an adverse 4 determination denying such coverage within 72 hours of 5 obtaining all necessary information. For purposes of the bill, 6 “necessary information” includes the results of a face-to-face 7 clinical evaluation or second opinion that may be required. 8 A utilization review entity cannot require prior 9 authorization for emergency transportation to a hospital or for 10 the provision of emergency health care services. A utilization 11 review entity must allow a person covered by a health benefit 12 plan and the person’s health care provider a minimum of 24 13 hours to notify the entity following an emergency hospital 14 admission or the provision of emergency health care services, 15 on the next business day if the admission or provision of 16 services occurs on a holiday or weekend. 17 A utilization review entity shall authorize coverage 18 of emergency health care services necessary to screen and 19 stabilize a covered person. If a health care provider 20 certifies in writing to a utilization review entity within 21 72 hours of a covered person’s admission to a hospital that 22 the covered person’s condition required emergency health care 23 services, that certification shall create a presumption that 24 the emergency health care services were medically necessary and 25 such presumption may be rebutted only if the utilization review 26 entity can establish, by clear and convincing evidence, that 27 the emergency health care services provided were not medically 28 necessary. 29 A determination of the medical necessity or appropriateness 30 of emergency health care services provided to a covered person 31 cannot be based on whether or not those services were provided 32 by a health care provider under contract to provide health care 33 services pursuant to a health benefit plan. Requirements or 34 restrictions on coverage of emergency health care services 35 -10- LSB 2464XC (4) 87 av/rh 10/ 12
S.F. _____ provided by health care providers not under contract to 1 provide services pursuant to a health benefit plan cannot be 2 greater than restrictions or requirements that apply when those 3 services are provided by a health care provider under contract 4 to provide such services pursuant to the health benefit plan. 5 If a covered person receives emergency health care services 6 that require immediate postevaluation or poststabilization 7 health care services, a utilization review entity shall give 8 authorization or make an adverse determination within 60 9 minutes of receiving a request for prior authorization, and if 10 the entity does not authorize or deny coverage of the health 11 care services within that time, coverage of such services is 12 deemed to be authorized. 13 A utilization review entity cannot revoke, limit, condition, 14 or restrict a prior authorization after the date on which a 15 health care provider provides the health care services for 16 which authorization was received. Any language that attempts 17 to disclaim payment for health care services that have received 18 prior authorization is null and void. 19 A prior authorization is valid for not less than one year 20 from the date a health care provider receives the prior 21 authorization. A utilization review entity shall develop 22 an expedited process for the renewal of an existing prior 23 authorization including a certification that the factors 24 constituting medical necessity or medical appropriateness of 25 the health care services for which the renewal is sought remain 26 unchanged from the factors that were considered before issuance 27 of the original prior authorization. 28 A utilization review entity is required to establish an 29 administrative services fee schedule for prior authorization 30 determinations, consistent with the federal Medicare 31 resource-based relative value scale methodology used to 32 reimburse health care professionals for medical reports. The 33 fee schedule shall be utilized by the utilization review 34 entity to determine the amount of payments to health care 35 -11- LSB 2464XC (4) 87 av/rh 11/ 12
S.F. _____ professionals who complete administrative services required 1 by the utilization review entity as a condition of making 2 a prior authorization determination. “Administrative 3 services” includes but is not limited to peer-to-peer 4 clinical consultations or second opinions, and completion 5 of certification documentation. “Administrative services” 6 does not include those services rendered by a health care 7 professional in the provision of health care services to a 8 covered person. 9 If a utilization review entity fails to comply with 10 deadlines or other requirements of the bill, any health care 11 services subject to prior authorization are deemed to be 12 automatically preauthorized. 13 The provisions of the bill are severable and if any provision 14 or application of a provision is held invalid, the other 15 provisions or applications can be given effect without the 16 invalid provision or application. 17 The provisions of the bill are applicable to a health benefit 18 plan that is delivered, issued for delivery, continued, or 19 renewed in this state on or after January 1, 2018. 20 -12- LSB 2464XC (4) 87 av/rh 12/ 12
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