OHIO LEGISLATIVE SERVICE COMMISSION
Office of Research Legislative Budget
www.lsc.ohio.gov and Drafting Office
H.B. 130 Bill Analysis
135th General Assembly
Click here for H.B. 130’s Fiscal Note
Version: As Introduced
Primary Sponsor: Rep. Miller
Effective date:
Logan Briggs, Attorney
SUMMARY
Requires health insurers and the Ohio Department of Medicaid (ODM) to make prior
authorization data available on their public websites in a readily accessible format.
Requires health insurers and ODM to exempt a healthcare provider from prior
authorization requirements when at least 80% of the healthcare provider’s requests for
a service, device, or drug within the prior 12 months have been approved.
Permits healthcare providers to request evidence from a health insurer or ODM which
supports the insurer’s or ODM’s decision to deny an exemption, and to appeal that
decision.
Prohibits health insurers and ODM from requiring that healthcare providers initiate a
request as a condition of receiving an exemption.
Permits health insurers and ODM to review exemptions after 12 months, and
establishes guidelines for the exemption review process.
Permits a healthcare provider to appeal an exemption revocation.
Makes repeated violations of the bill an unfair and deceptive practice under the
Consumer Sales Protection Law (CSPL).
DETAILED ANALYSIS
Prior authorization exemptions
Prior authorization is a process through which a healthcare provider requests
provisional affirmation of coverage from a health insurer or the Ohio Department of Medicaid
(ODM) before a service, device, or drug is provided to a patient, and before a claim is submitted
April 18, 2023
Office of Research and Drafting LSC Legislative Budget Office
for payment. Insurers and ODM require prior authorization as a condition of approving a claim
for certain services, devices, and drugs. Review of prior authorization requests purportedly
ensures that coverage pays only for medically necessary care.1
The bill requires health insuring corporations, sickness and accident insurers, and ODM
or its designee (collectively, “health insurers”), to grant exemptions to those requirements
under certain circumstances. If a health insurer has a prior authorization requirement for a
service, device, or drug, and it has approved at least 80% of the prior authorization requests for
that service, device, or drug from a given healthcare provider within the prior 12 months, the
health insurer must exempt that provider from the prior authorization requirement for that
service, device, or drug. This exemption must last at least 12 months, but a health insurer may
choose to extend it for a longer period.2
The bill permits a healthcare provider that does not receive an exemption to request
that the health insurer provide evidence supporting its decision to deny the exemption. The bill
requires a health insurer to comply with these requests for evidence, but limits a healthcare
provider to making one such request per calendar year for the same service, device, or drug.
Additionally, the bill prohibits health insurers from requiring that a healthcare provider request
an exemption before it is granted.3
Required disclosures and notice
The bill requires a health insurer that applies a prior authorization requirement to make
prior authorization data available on its public website in a readily accessible format. The data
must include all of the following:
The specialty of the healthcare provider requesting the prior authorization;
Whether the prior authorization is for a healthcare service, a medical device, or a drug;
The indication for use of the service, device, or drug under the prior authorization;
If the prior authorization request was denied, the reason for the denial;
If the approval or denial of a request was appealed, and the result of the appeal;
The amount of time between the submission of a prior authorization request and the
response from the health insurer.4
1 Prior Authorization Process for Certain Hospital Outpatient Department Services Frequently Asked
Questions (PDF), which may be accessed by conducting a keyword “Prior Authorization Process for
Certain Hospital Outpatient Department Services” search and navigating to “OPD Frequently Asked
Questions (PDF)” on the Centers for Medicare & Medicaid Services’ website: cms.gov.
2 R.C. 1751.722(A), 3923.043(A), and 5160.342(A).
3 R.C. 1751.722(B) and (D), 3923.043(B) and (D), and 5160.342(B) and (D).
4 R.C. 1751.721, 3923.042, and 5160.341.
P a g e |2 H.B. 130
As Introduced
Office of Research and Drafting LSC Legislative Budget Office
When a health insurer grants a prior authorization exemption, the bill requires that the
insurer provide written notice to the healthcare provider that submitted the request. The
notice must include all of the following information:
A statement that the healthcare provider qualifies for an exemption;
The healthcare service, medical device, or drug to which the exemption applies;
The dates the exemption begins and ends.5
Prior authorization exemption evaluation
Evaluating and revoking exemptions
After 12 months, a health insurer may evaluate an exemption granted under the bill.
The health insurer conducting an evaluation must review ten claims submitted to the insurer by
the healthcare provider, chosen at random. These ten claims must be from the three months
immediately prior to the evaluation, unless there are not ten relevant claims in those three
months. In that case, the health insurer may review earlier claims.6
If less than 80% of the claims reviewed would have been approved based on medical
necessity, then the bill permits the health insurer to revoke the exemption. This standard
differs from the requirements for granting the exemption initially, which provide that the
exemption must be granted if 80% of the claims in the preceding 12 months are approved for
any reason. For an exemption to remain in force, 80% of the reviewed claims must have been
medically necessary, meaning there is a higher bar to retain the exemption than to receive one
in the first place. The bill prohibits a health insurer from reviewing a healthcare provider’s
exemption for a particular service, device, or drug more than once every 12 months. If an
evaluation does not provide grounds to revoke an exemption, it remains valid for at least
12 more months until the health insurer is permitted to conduct another evaluation.7
The bill requires that the decision to revoke or deny an exemption be made by a
healthcare provider licensed in Ohio who practices the same or a similar specialty as the
healthcare provider under consideration. That healthcare provider making the decision must
also have experience in providing the service, device, or drug covered by the exemption. 8
If an exemption is revoked, the bill requires health insurers to provide the healthcare
provider with notice containing the information relied upon in making the determination, and a
plain language explanation of how to appeal the decision. The bill also clarifies that it does not
prevent health insurers from making an administrative denial of a claim.9
5 R.C. 1751.722(E), 3923.043(E), and 5160.342(E).
6 R.C. 1751.722(F)(1) and (2), 3923.043(F)(1) and (2), and 5160.342(F)(1) and (2).
7 R.C. 1751.722(F)(3)(a) and (4), 3923.043(F)(3)(a) and (4), and 5160.342(F)(3)(a) and (4).
8 R.C. 1751.722(I), 3923.043(I), and 5160.342(I).
9 R.C. 1751.722(F)(3)(b) and (J), 3923.043(F)(3)(b) and (J), and 5160.342(F)(3)(b) and (J).
P a g e |3 H.B. 130
As Introduced
Office of Research and Drafting LSC Legislative Budget Office
Appeals
The bill allows a healthcare provider to appeal a decision to revoke an exemption within
30 days of receiving the notice described above. If the healthcare provider appeals and the
decision is upheld, the exemption remains in effect for five days after the decision to uphold
the revocation. If an exemption is revoked and the decision is not appealed, the exemption
remains in effect for 30 days after the healthcare provider receives notice of the revocation.10
Enforcement
A series of violations of the bill’s provisions by a health insuring corporation or sickness
and accident insurer which, when taken together, constitute a practice or pattern, are
considered an unfair and deceptive business practice under the Consumer Sales Protection Law
(CSPL). Additionally, the bill permits the Superintendent of Insurance and the Director of
Medicaid to adopt rules necessary to implement the provisions of the bill.11
Other provisions
The bill extends the definitions in R.C. 5160.34 to the new provisions added to the
Medical Assistance Programs chapter of the Revised Code. Among those definitions, the bill
clarifies that “prior authorization” includes prospective or utilization review procedures
conducted prior to providing a medical device, as opposed to a device generally. The bill
removes the definition of “utilization review organization,” as the term is not used elsewhere in
the operative Revised Code sections.12
The bill also clarifies that if a healthcare provider submits a request for prior
authorization electronically, either ODM or its designee is responsible for responding to the
request within 48 hours of receipt by the department for urgent care services, or within ten
days of receipt for any prior authorization request that is not for an urgent care service. Current
law does not expressly permit an ODM designee to respond to such requests.13
HISTORY
Action Date
Introduced 03-23-23
ANHB0130IN-135/ks
10 R.C. 1751.722(G) and (H), 3923.043(G) and (H), and 5160.342(G) and (H).
11 R.C. 1751.723, 3923.044, and 5160.34(E).
12 R.C. 5160.34(A), (A)(4), and (A)(6).
13 R.C. 5160.34(B)(4).
P a g e |4 H.B. 130
As Introduced
Statutes affected: As Introduced: 5160.34