More States Pursuing Prior Authorization Reform 

By Consumers for Quality Care, on April 17, 2024

More States Pursuing Prior Authorization Reform 

More than two dozen states are looking to follow New Jersey, Washington, and Washington, D.C. in passing legislation aimed at addressing health care problems caused by prior authorization hurdles within our health care system, according to NPR

Sandra Johnson of New Jersey uses an injectable medication to treat her severe asthma. Initially, her insurer approved the medicine, but when she needed prior authorization months later, her request was denied. Since then, Johnson has been unable to attain this medication. “I don’t have an understanding of why it’s being denied when this medication that I have been taking has been working for me,” said Johnson. 

Although prior authorization is meant to be a cost-control measure, patient advocates suspect that some insurers are exploiting it to deny care to patients. A 2022 American Medical Association survey found that in nearly every case, prior authorization delayed medically necessary treatment, and that it resulted in hospitalizations in a third of all cases.   

Earlier this year, New Jersey became the second state to pass a law aimed at addressing the administrative hurdles associated with prior authorization. The new guidelines require health insurance companies to decide on most prior authorization requests within three days. But if the case is urgent, then the insurance company has just 24 hours to make a determination. By requiring health insurers to make quicker decisions on prior authorization requests, New Jersey’s new law seeks to address a common frustration among patients and health care providers, potentially leading to faster access to necessary medical services. Although the law does not eliminate prior authorization, it seeks to strike a balance between cost control and patient access to care.   

Recently, the Centers for Medicare & Medicaid Services (CMS) finalized a new rule that will reduce the decision times typically associated with prior authorization. 

CQC applauds efforts to reform the prior authorization process and urges both lawmakers and providers to eliminate needless, burdensome processes that prevent consumers from receiving the medical care they need.