00 CS FOR HOUSE BILL NO. 187(L&C) 01 "An Act relating to utilization review entities; relating to prior authorization requests; 02 and providing for an effective date." 03 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 04 * Section 1. AS 21.07.005(a) is amended to read: 05 (a) The director shall adopt regulations to provide standards and criteria for 06 (1) the structure and operation of utilization review and benefit 07 determination processes, including processes for utilization review entities under 08 AS 21.07.100; 09 (2) the establishment and maintenance of procedures by health care 10 insurers to ensure that a covered individual has the opportunity for appropriate 11 resolution of grievances; and 12 (3) an independent review of an adverse determination or final adverse 13 determination. 14 * Sec. 2. AS 21.07 is amended by adding a new section to read: 01 Sec. 21.07.100. Utilization review entities. (a) A utilization review entity may 02 not require a health care provider to complete a prior authorization for a health care 03 service for a covered person to receive coverage for the health care service if, during 04 the most recent 12-month period, the utilization review entity has approved or would 05 have approved at least 80 percent of the prior authorization requests submitted by the 06 health care provider for that health care service. 07 (b) A utilization review entity may evaluate whether a health care provider 08 continues to qualify for an exemption under (a) of this section not more than once 09 every 12 months. A utilization review entity is not required to evaluate an existing 10 exemption, and nothing prevents a utilization review entity from establishing a longer 11 exemption period. 12 (c) A health care provider is not required to request an exemption to qualify 13 for an exemption. 14 (d) If a health care provider does not receive an exemption under (a) of this 15 section, the health care provider may, once every 12 months of providing health care 16 services, request the utilization review entity to provide evidence to support its 17 determination. A health care provider may appeal a determination to deny a prior 18 authorization exemption under (a) of this section. The utilization review entity shall 19 provide to the health care provider an explanation of how to appeal the determination. 20 (e) A utilization review entity may revoke an exemption under (a) of this 21 section after 12 months if the utilization review entity 22 (1) makes a determination that the health care provider would not have 23 met the 80 percent approval criteria based on a retrospective review of the claims for 24 the health care service for which the exemption applies for the previous three months 25 or the period needed to reach a minimum of 10 claims for review; 26 (2) provides the health care provider with the information used by the 27 utilization review entity to make the determination to revoke the exemption; and 28 (3) provides an explanation to the health care provider on how to 29 appeal the determination. 30 (f) An exemption under (a) of this section remains in effect until the 30th day 31 after the date the utilization review entity notifies the health care provider of its 01 determination to revoke the exemption or, if the health care provider appeals the 02 determination, the fifth day after the revocation is upheld on appeal. 03 (g) A determination to revoke or deny an exemption by a utilization review 04 entity must be made by a health care provider licensed in the state with the same or a 05 similar specialty as the health care provider being considered for an exemption and 06 must have experience in providing the health care service for which the requested 07 exemption applies. 08 (h) A utilization review entity must provide a health care provider who 09 receives an exemption under (a) of this section with a notice that includes a 10 (1) statement that the health care provider qualifies for an exemption 11 from a prior authorization requirement and the duration of the exemption; and 12 (2) list of health care services for which the exemption applies. 13 (i) A utilization review entity may not deny or reduce payment for a health 14 care service exempted from a prior authorization requirement under (a) of this section, 15 including a health care service performed or supervised by another health care 16 provider when the health care provider who ordered the service received a prior 17 authorization exemption, unless the health care provider providing the health care 18 service 19 (1) knowingly and materially misrepresented the health care service in 20 a request for payment submitted to the utilization review entity with the specific intent 21 to deceive and obtain an unlawful payment from a utilization review entity; or 22 (2) failed to substantially perform the health care service. 23 (j) If a utilization review entity requires a prior authorization for a health care 24 service for the treatment of a chronic or long-term care condition, the prior 25 authorization is valid for the length of the treatment and the utilization review entity 26 may not require the covered person to obtain another prior authorization for the health 27 care service. 28 (k) In this section, 29 (1) "health care service" means 30 (A) the provision of pharmaceutical products, services, or 31 durable medical equipment; or 01 (B) a health care procedure, treatment, or service provided 02 (i) in a health care facility licensed in this state; or 03 (ii) by a doctor of medicine, by a doctor of osteopathy, 04 or within the scope of practice of a health care professional who is 05 licensed in this state; 06 (2) "health maintenance organization" has the meaning given in 07 AS 21.86.900; 08 (3) "prior authorization" means the process used by a utilization review 09 entity to determine the medical necessity or medical appropriateness of a covered 10 health care service before the health care service is provided or a requirement that a 11 covered person or health care provider notify a health care insurer or utilization review 12 entity before providing a health care service; 13 (4) "utilization review entity" means an individual or entity that 14 performs prior authorization for 15 (A) an employer in this state with employees covered under a 16 health benefit plan or health insurance policy; 17 (B) a health care insurer; 18 (C) a preferred provider organization; 19 (D) a health maintenance organization; or 20 (E) an individual or entity that provides, offers to provide, or 21 administers hospital, outpatient, medical, prescription drug, or other health care 22 benefits to a person treated by a health care provider licensed in this state 23 under a health care policy, plan, or contract. 24 * Sec. 3. This Act takes effect immediately under AS 01.10.070(c).