Governor Murphy signs state prior authorization reform legislation supported by NJAFP

Governor Murphy signs state prior authorization reform legislation supported by NJAFP

Governor Murphy signed legislation into law this week that seeks to address some of the key complaints around the prior authorization process in New Jersey. While the law is not perfect and met many challenges, opposition and amendments from the health plans lobbying against the bill, there are some beneficial changes to the bill current system of prior authorization:

The key provisions include –

  • Medications: Under current law, PA requests for medications must be decided within 15 days. Under the bill, urgent PA requests for medications must now be decided within 24 hours. Non-urgent requests must be decided in 72 hours. The treating physician decides whether the request is urgent.
  • Diagnostics and procedures: Under current law, insurers must decide PA requests within 15 days. Under the bill, urgent PA requests must be decided within 72 hours; non-urgent requests within nine days if submitted electronically, 12 if submitted on paper. Note: 72 hour turnaround can be decreased if required by medical exigencies of the case. Again, treating physician determines medical exigencies.
  • Missed deadlines result in automatically approved PA requests.
  • Chronic Conditions and Multiple Dates of Service: Where a PA has been granted for treatment of a chronic condition or for a defined series of services (e.g., chemotherapy course of treatment, psychotherapy sessions) no further PA is permitted for six months.
  • In-Specialty Physician Review on Appeals: All denials on appeal must be issued by a physician who has Board certification in a specialty that treats the condition at issue, or the physician must have had experience treating the condition at issue within the last five years.
  • Peer-to-Peer Right: Insurers must provide for a peer-to peer between the reviewing physician and treating physician, at the treating physician's request, on any denial of an appeal.
  • Insurer Reporting Requirements: Insurers must now report a host of statistics about their PA processes such as the tests/therapies that are subject to PA, approval/denial rates, reasons for denials, and various information about appeals.
  • This would apply to all state regulated plans, including individual and small employer plans. We also were able to keep School Employees and State Employees Health Benefits Plans in the bill, increasing by about one million the number of patients affected by the bill. However, Medicaid was removed from the bill. This would not impact self-funded/ERISA plans, which make up about 70-80% of the New Jersey insured market. Although, see article below from CMS on the final rule adopted addressing prior authorization on the federal level.

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