The bill amends South Dakota's existing laws on preauthorization and utilization review for certain health care services and health benefit plans. It expands the definition of "adverse determination" to include criteria such as medical necessity, appropriateness, and effectiveness. A significant new requirement mandates that utilization review organizations must provide health care practitioners with a reasonable opportunity to discuss treatment plans before making an adverse determination, effective for reviews requested on or after July 1, 2025. The bill also aligns the preauthorization process for health benefit plans with that of insurers, applies to health maintenance organizations and certain insurance plans, and excludes the state Medicaid program. Additionally, it requires evaluations for exemptions from preauthorization every six months, allowing continued exemptions based on a high approval rate of requests.

Moreover, the legislation introduces provisions for maintaining exemptions from preauthorization without the need for regular evaluations and clarifies that health care professionals are not required to request exemptions to qualify. Exemptions will remain in effect until a formal rescission process is initiated, which can only occur under specific conditions, and professionals must be notified of any rescission at least thirty days in advance. The bill also outlines the independent review process for adverse determinations, mandates that health maintenance organizations or insurers cover the costs of these reviews, and prohibits retroactive denial of services based on rescinded exemptions unless certain conditions are met. Overall, the bill aims to streamline the preauthorization process while ensuring transparency and protecting the rights of health care providers.

Statutes affected:
Introduced, 01/22/2025: 58-17H-1