TRENTON – In an effort to ensure greater transparency in medical billing and to enhance the likelihood of more timely care and fewer negative health outcomes, the Senate Commerce Committee advanced legislation sponsored by Senator Vin Gopal aimed at reforming the act of prior authorization. Similar to reform efforts being undertaken in other states, the bill would place certain requirements on the use of prior authorization — a process sometimes used by insurance companies to determine whether a prescribed product or service will be covered.
The legislation would require a utilization review entity to make any current prior authorization requirements and restrictions, including written clinical criteria, readily accessible on its Internet website to subscribers, health care providers, and the general public. Requirements would be required to be described in detail but also in easily understandable language.
“While we can appreciate the necessity of prior review and authorization in some medical cases, we also know that such prior authorization can lead to absenteeism and reduced productivity if employees can’t receive the care they need in a timely manner and at a reasonable cost,” said Senator Gopal (D-Monmouth).
A survey by the American Medical Association found that 1 in 5 patients reported delays in treatment due to Prior Authorization, 13 percent were hospitalized as a result of the process, and 30 percent opted to pay out of pocket to get timely care.
The bill, S-1794, would also require electronic authorization through the National Council for Prescription Drug Programs’ (NCPDP’s) electronic prior authorization (ePA) standard.
The bill passed the Senate Commerce Committee by a vote of 5-0.