02/15/2024 03:00 PM House HEALTH & SOCIAL SERVICES

         HB 187-PRIOR AUTH EXEMPT FOR HEALTH PROVIDERS                                                                      
                                                                                                                                
3:59:18 PM                                                                                                                    
                                                                                                                                
CHAIR PRAX  announced that  the next order  of business  would be                                                               
HOUSE  BILL  NO. 187,  "An  Act  relating to  utilization  review                                                               
entities;  exempting certain  health care  providers from  making                                                               
preauthorization  requests for  certain  services; and  providing                                                               
for an effective date."                                                                                                         
                                                                                                                                
4:00:00 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE JESSE  SUMNER, Alaska State Legislature,  as prime                                                               
sponsor, gave the  sponsor statement for HB 187  [included in the                                                               
committee packet],  which read  as follows  [original punctuation                                                               
provided]:                                                                                                                      
                                                                                                                                
     Sponsor Statement                                                                                                          
     HB 187: Prior Auth Exempt for Health Providers                                                                             
                                                                                                                                
     HB 187 aims to reduce  the wait time for certain health                                                                    
     care services  by exempting health care  providers from                                                                    
     making preauthorization requests for said services.                                                                        
                                                                                                                                
     Currently,  Alaskans  who   need  certain  health  care                                                                    
     services must  wait days  and even weeks  at a  time to                                                                    
     get  pre-authorized  to  receive health  care  services                                                                    
     because of the processing  time between the health care                                                                    
     provider and insurance companies.  This bill would help                                                                    
     Alaskans  receive  health  care  services  immediately,                                                                    
     especially health  care services that could  save their                                                                    
     lives.                                                                                                                     
                                                                                                                                
     This  bill would  create  a  utilization review  entity                                                                    
     that  may  evaluate  whether  a  health  care  provider                                                                    
     continues  to qualify  for an  exemption if  during the                                                                    
     most recent  12- month  period, the  utilization review                                                                    
     entity has  approved or would  approve at least  80% of                                                                    
     the  prior  authorization  requests  submitted  by  the                                                                    
     health care provider for that health care service.                                                                         
                                                                                                                                
     The Health Care provider is  not required to request an                                                                    
     exemption to  qualify for  an exemption.  A utilization                                                                    
     review  may not  deny or  reduce payment  for a  health                                                                    
     care service that is exempted.                                                                                             
                                                                                                                                
     Other states  with prior authorization  exemptions have                                                                    
     seen increased  frequency of  patients who  receive the                                                                    
     health care services they need expediently.                                                                                
                                                                                                                                
     This bill  will help Alaskans receive  fast, efficient,                                                                    
     and  quality  healthcare  when  they  need  it  without                                                                    
     waiting  for  a  preauthorization  process  that  could                                                                    
     cause their health to decline even more.                                                                                   
                                                                                                                                
4:01:42 PM                                                                                                                    
                                                                                                                                
SARENA HACKENMILLER,  Staff, Representative Jesse  Sumner, Alaska                                                               
State  Legislature, on  behalf  of  Representative Sumner,  prime                                                               
sponsor, presented  the sectional  analysis for HB  187 {included                                                               
in  the  committee  packet]  which   read  as  follows  [original                                                               
punctuation provided]:                                                                                                          
                                                                                                                                
     HB  187:   Prior  Auth  Exempt  for   Health  Providers                                                                    
     Sectional Analysis                                                                                                         
                                                                                                                                
     Section  1: AS  21.07.005(a) is  amended to  insert the                                                                    
     following language  into sub-section  (1) under  (a) so                                                                    
     it reads  "the structure  and operation  of utilization                                                                    
     review and  benefit determination  processes, including                                                                    
     processes  for  utilization  review entities  under  AS                                                                    
     21.07.100".                                                                                                                
                                                                                                                                
     Sec. 2.  AS 21.07  is amended by  adding a  new section                                                                    
     called Sec.  21.07.100. Utilization Review  Entities to                                                                    
     implement the following:                                                                                                   
                                                                                                                                
     A utilization  review entity may  not require  a health                                                                    
     care provider  to complete a prior  authorization for a                                                                    
     health  care service  for a  covered person  to receive                                                                    
     coverage  for the  health care  service if,  during the                                                                    
     most  recent 12  month period,  the utilization  review                                                                    
     entity has approved  or would have approved  at least 0                                                                    
     percent of  the prior authorization  requests submitted                                                                    
     by  the  health  care  provider for  that  health  care                                                                    
     service.                                                                                                                   
                                                                                                                                
     A  utilization review  entity  may  evaluate whether  a                                                                    
     health  care  provider  continues  to  qualify  for  an                                                                    
     exemption  not  more  than  once  every  12  months.  A                                                                    
     utilization review  entity is not required  to evaluate                                                                    
     an   existing  exemption,   and   nothing  prevents   a                                                                    
     utilization  review entity  from establishing  a longer                                                                    
     exemption  period.  A  health   care  provider  is  not                                                                    
     required  to request  an exemption  to  qualify for  an                                                                    
     exemption.                                                                                                                 
                                                                                                                                
     If  a   health  care  provider  does   not  receive  an                                                                    
     exemption, the health care provider  may, once every 12                                                                    
     months of  providing health care services,  request the                                                                    
     utilization  review entity  to provide  a determination                                                                    
     to deny  a prior  authorization exemption under  (a) of                                                                    
     this  section.  The  utilization  review  entity  shall                                                                    
     provide to  the health care provider  an explanation of                                                                    
     how to appeal the determination.                                                                                           
                                                                                                                                
     A  utilization review  entity may  revoke an  exemption                                                                    
     after 12  months if the utilization  review entity does                                                                    
     the following:                                                                                                             
                                                                                                                                
     • Decides that the health  care provider would not have                                                                    
     met the 80% approval  criteria based on a retrospective                                                                    
     review of  the claims for  the health care  service for                                                                    
     which  the exemption  applies  for  the previous  three                                                                    
     months or  the period needed  to reach a minimum  of 10                                                                    
     claims for review.                                                                                                         
                                                                                                                                
         Provides  the   health  care   provider  with   the                                                                    
     information used  by the  utilization review  entity to                                                                    
     make the determination to revoke the exemption.                                                                            
                                                                                                                                
     • Provides  an explanation  to the health  car provider                                                                    
     on how to appeal the determination.                                                                                        
                                                                                                                                
     The  exemption remains  in effect  until  the 30th  day                                                                    
     after the  date the utilization review  entity notifies                                                                    
     the  health  care  provider  of  its  determination  to                                                                    
     revoke the  exemption or, if  the health  care provider                                                                    
     appeals  the determination,  the  fifth  day after  the                                                                    
     revocation is upheld on appeal.                                                                                            
                                                                                                                                
     A determination  to revoke  or deny  an exemption  by a                                                                    
     utilization  review entity  must  be made  by a  health                                                                    
     care  provider  licensed in  Alaska  with  the same  or                                                                    
     similar  specialty as  the health  care provider  being                                                                    
     consider for  an exemption and must  have experience in                                                                    
     the health  care service, they are  providing for which                                                                    
     the requested exemption applies.                                                                                           
                                                                                                                                
     A utilization review entity must  provide a health care                                                                    
     provider  who receives  an  exemption  of this  section                                                                    
     with a notice that includes the following:                                                                                 
                                                                                                                                
     • A  statement that the health  care provider qualifies                                                                    
     for   an   exemption   from   a   prior   authorization                                                                    
     requirement and the duration of the exemption.                                                                             
                                                                                                                                
     •  A  list  of  health  care  services  for  which  the                                                                    
     exemption applies.                                                                                                         
                                                                                                                                
     A  utilization review  entity may  not  deny or  reduce                                                                    
     payment  for  a health  care  service  exempted from  a                                                                    
     prior  authorization  requirement, including  a  health                                                                    
     care service performed or  supervised by another health                                                                    
     care  provider  when  the   health  care  provider  who                                                                    
     ordered  the  service  received a  prior  authorization                                                                    
     exemption,  unless the  health care  provider providing                                                                    
     the health care service does the following:                                                                                
                                                                                                                                
     •  Knowingly and  materially misrepresented  the health                                                                    
     care service  in a quest  for payment submitted  by the                                                                    
     utilization review  entity with the specific  intent to                                                                    
     deceive  and   obtain  an   unlawful  payment   form  a                                                                    
     utilization review entity.                                                                                                 
                                                                                                                                
        Failed  to  substantially perform  the  health  care                                                                    
     service(s)                                                                                                                 
                                                                                                                                
     In this sectional analysis, the following are defined:                                                                     
                                                                                                                                
      • "Health care services" means the following:                                                                             
                                                                                                                                
     o The  provision of pharmaceutical  products, services,                                                                    
     or durable medical equipment                                                                                               
                                                                                                                                
     o  A  health  care  procedure,  treatment,  or  service                                                                    
     provided in  a health care facility  licensed in Alaska                                                                    
     or by  a Doctor of  Medicine, Doctor of  Osteopathy, or                                                                    
     within  the   scope  of  practice  of   a  health  care                                                                    
     professional who is licensed in Alaska.                                                                                    
                                                                                                                                
     •  "Health maintenance  organization"  has the  meaning                                                                    
     given in AS 21.86.900.                                                                                                     
                                                                                                                                
     •  "Prior authorization"  means the  process used  by a                                                                    
     utilization  review  entity  to determine  the  medical                                                                    
     necessity  or  medical  appropriateness  of  a  covered                                                                    
     entity to  determine the  medical necessity  or medical                                                                    
     appropriateness  of  a   covered  health  care  service                                                                    
     before  the  health  care  service  is  provided  or  a                                                                    
     requirement  that  a  covered  person  or  health  care                                                                    
     provider notify  a health  care insurer  or utilization                                                                    
     review entity before providing a health care service.                                                                      
                                                                                                                                
     • "Utilization  review entity"  means an  individual or                                                                    
     entity  that  performs   prior  authorization  for  the                                                                    
     following:                                                                                                                 
                                                                                                                                
     o An employer in Alaska  with employees covered under a                                                                    
     health benefit plan or health insurance policy.                                                                            
                                                                                                                                
     o A health care insurer                                                                                                    
                                                                                                                                
     o A preferred provider organization                                                                                        
                                                                                                                                
     o A health maintenance organization                                                                                        
                                                                                                                                
     o  An individual  or entity  that  provides, offers  to                                                                    
     provide, or administers  hospital, outpatient, medical,                                                                    
     prescription drug,  or other health care  benefits to a                                                                    
     person treated  by a health  care provider  licensed in                                                                    
     Alaska under a health care policy, plan, or contract.                                                                      
                                                                                                                                
     Sec.  3. This  Act  takes effect  immediately under  AS                                                                    
     01.10.070(c)                                                                                                               
                                                                                                                                
4:07:54 PM                                                                                                                    
                                                                                                                                
CHAIR PRAX  announced the committee would  hear invited testimony                                                               
on HB 187.                                                                                                                      
                                                                                                                                
4:08:09 PM                                                                                                                    
                                                                                                                                
PAM   VENTGEN,   Executive   Director,   Alaska   State   Medical                                                               
Association, expressed  her support  for HB  187.   She explained                                                               
how prior  authorization works and how  it is often a  barrier to                                                               
treatment.     She   gave  statistics   and  examples   of  prior                                                               
authorization having a negative impact  on patient care, and said                                                               
oncology  is  especially  impacted  by  the  prior  authorization                                                               
issue.                                                                                                                          
                                                                                                                                
4:11:04 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  MINA asked  how often  claims are  denied due  to                                                               
prior authorization and  how much time goes  into appealing those                                                               
claims by patients trying to get services.                                                                                      
                                                                                                                                
MS.  VENTGEN replied  that the  American Medical  Association has                                                               
that  data,  and  she  will   forward  that  information  to  the                                                               
committee members.                                                                                                              
                                                                                                                                
4:12:17 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  RUFFRIDGE  described  how  much  time  goes  into                                                               
processing prior  authorizations, leaving  less time  for patient                                                               
care.                                                                                                                           
                                                                                                                                
MS. VENTGEN  agreed with  Representative Ruffridge  and responded                                                               
with specific examples.                                                                                                         
                                                                                                                                
4:13:38 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE MINA asked Ms. Ventgen  what feedback she receives                                                               
from insurance  companies regarding  the potential for  waste and                                                               
fraud under this scenario.                                                                                                      
                                                                                                                                
MS. VENTGEN explained that insurance  companies claim a bill such                                                               
as this  leads to  waste and  fraud.   However, similar  bills in                                                               
other  states have  shown  that  when 80  percent  of claims  are                                                               
approved, incidents of fraud and  waste go down considerably.  If                                                               
half of the physician's prior  authorization requests are denied,                                                               
that raises more  of a question.   That is why the  bill sets the                                                               
number at 80 percent.  Physicians  who have a lower percentage of                                                               
reliable   authorizations   will   still  need   to   use   prior                                                               
authorization.                                                                                                                  
                                                                                                                                
4:15:51 PM                                                                                                                    
                                                                                                                                
EZEQUIEL  SILVA, MD,  Member, Texas  Medical Association,  shared                                                               
his  experience with  issues caused  by delayed  or denied  prior                                                               
authorizations.   He gave  examples of  significant lags  in care                                                               
because  of  slow authorizations.    The  serious adverse  events                                                               
motivated the Texas  State Legislature to pass a  bill similar to                                                               
HB 187,  and since  that time, Texas  has seen  positive results.                                                               
He expressed support for HB 187.                                                                                                
                                                                                                                                
4:17:52 PM                                                                                                                    
                                                                                                                                
LORI   WING-HEIER,  Director,   Division  of   Insurance,  Alaska                                                               
Department  of  Commerce,  Community, and  Economic  Development,                                                               
explained that  the prior authorization  issue is  very emotional                                                               
for  many  people,  "because  when  you  want  your  health  care                                                               
service,  you want  it  now."   On the  other  hand, people  want                                                               
affordable  health care.    The providers  claim  this bill  will                                                               
reduce  costs,  but  insurers  say  if  there  is  no  review  of                                                               
treatment, it  may be even  more costly.   She explained  how the                                                               
external review process works.                                                                                                  
                                                                                                                                
4:19:59 PM                                                                                                                    
                                                                                                                                
CHAIR  PRAX questioned  whether the  division has  data regarding                                                               
the records of physicians who  no longer need prior authorization                                                               
because their treatment authorizations  are correct 80 percent of                                                               
the time.                                                                                                                       
                                                                                                                                
MS. WING-HEIER replied  that she didn't have that  data but would                                                               
see what was available.                                                                                                         
                                                                                                                                
CHAIR PRAX asked whether the percent of appeals was significant.                                                                
                                                                                                                                
MS.  WING-HEIER explained  that not  many people  go directly  to                                                               
insurance companies  with grievances  about authorizations.   She                                                               
would have to ask the  insurance companies about the numbers, and                                                               
it  would take  several weeks  to get  the information  about how                                                               
many   grievances  insurance   companies   had  regarding   prior                                                               
authorizations.                                                                                                                 
                                                                                                                                
4:21:48 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE SADDLER questioned  what constitutes a utilization                                                               
review entity as referenced on page  4 of HB 187and whether there                                                               
were any in Alaska.                                                                                                             
                                                                                                                                
MS.  WING-HEIER   replied  that  there  are   utilization  review                                                               
entities in Alaska.   She described the procedure  a person would                                                               
go through when  a prior authorization is denied.   She would get                                                               
the names of utilization review entities to the committee.                                                                      
                                                                                                                                
REPRESENTATIVE  SADDLER  reiterated   his  understanding  of  the                                                               
workflow for prior authorizations grievances and reviews.                                                                       
                                                                                                                                
MS. WING-HEIER said the review  process starts with the insurance                                                               
company saying  yes or no.   If the  patient or physician  is not                                                               
happy with  the answer, then  it goes to  the division.   At that                                                               
point  the  division asks  for  an  external  review.   Once  the                                                               
external review is  returned to the division, it  informs all the                                                               
parties:  the insurer, the provider, and the patient.                                                                           
                                                                                                                                
4:24:16 PM                                                                                                                    
                                                                                                                                
CHAIR  PRAX  reiterated his  understanding  that  once a  service                                                               
provider proves that 80 percent  of the prior authorizations have                                                               
been  accepted, then  that  provider would  not  need to  request                                                               
prior  authorization  review.    He  asked  whether  that  was  a                                                               
lifetime exemption.                                                                                                             
                                                                                                                                
4:25:12 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE SUMNER called attention to Section 2, line 8.                                                                    
                                                                                                                                
CHAIR PRAX requested clarification  concerning an insurer's point                                                               
of view.                                                                                                                        
                                                                                                                                
REPRESENTATIVE  SUMNER  described   how  the  utilization  review                                                               
entity would make that determination.                                                                                           
                                                                                                                                
4:27:13 PM                                                                                                                    
                                                                                                                                
CHAIR PRAX announced HB 187 was held over.