February 7, 2022
Nyasha Smith, Secretary
Council of the District of Columbia
1350 Pennsylvania Avenue, N.W.
Washington, DC 20004
Dear Secretary Smith,
Today, I, along with Councilmembers Gray, Allen, Lewis George, and Bonds,
am introducing the Prior Authorization Reform Amendment Act of 2022. Please
find enclosed a signed copy of the legislation.
In recent years, health insurers across the United States have adopted a new
practice, wherein patients and their medical providers are required to seek prior
authorization for certain medications, medical procedures, or other medical care.
Prior authorization requirements mean that an insurer is able to overrule the
treatment prescribed by a patients medical providerand make that determination
without ever seeing the patient or their medical records. While insurers may claim
that prior authorization is currently required for only complex procedures, a
growing number of basic, everyday treatments require prior authorization; in fact,
more and more, it seems that the cost of treatment, not a determination of medical
necessity for different care, is driving what medications and procedures require
prior authorization.
When unregulated, prior authorization requirements can and do cause
meaningful harm to patients. Seeking a prior authorization (or appealing a denial)
can take weeks or even months, during which time patients will typically go
without care. This not only means the patient continues to suffer, but some
conditions may worsen over time. Unfortunately, these lengthy delays inure to the
benefit of insurers as patients, not wanting to wait for care, may seek different,
possibly less effective treatment that doesnt require prior authorization. And,
where that alternate treatment is less expensive, the insurer saves money.
Making matters worse, insurers may not make prior authorization
requirements clear and accessible to patients. Some insurers may not include full
information on prior authorization requirements on their website, and decline to
provide clarity via e-mail or the phone; often, patients may learn the grounds for a
denial of a prior authorization and how to cure via letters sent snail mail, further
delaying care for these patients. These delays and the lack of clarity on how one
might successfully receive prior authorization for a treatment also push patients to
seek cheaper, sometimes less effective care that does not require this approval. It is
clear: unregulated prior authorization requirements result in slower, worse quality
care for patients, with the only benefits flowing to insurance companies.
In fact, prior authorization requirements also create problems for medical
providers. Doctors report investing a growing number of staff hours to processing
prior authorization requests or appeals on behalf of patients; that time is even
greater in states, like the District, that do not regulate these processes, as insurers
may use different forms, processes, and review standards. Some medical providers
have even reported having to bring on additional staff to handle prior
authorizations. This means higher overhead for doctors officescosts that
ultimately get passed on to patients. Dealing with these processes also mean
medical providers have less time to care for patients.
More than forty states have passed legislation or adopted regulations to
address insurer prior authorization practices, and this legislation would bring the
District in line with those jurisdictions. The bill sets explicit, reasonable timelines
for insurers to respond to prior authorization requests and appeals, and lays out the
qualifications of personnel qualified to make these determinations (as some insurers
have personnel without appropriate subject matter training reviewing prior
authorization requests). The legislation would also clarify how insurers are to make
information on prior authorization determinations available to patients and their
medical providers, and require that insurers accept and use the electronic NCPDP
SCRIPT Standard ePA transaction, the recommended, standardized method for
submission and review of prior authorization requests. Finally, and perhaps most
importantly, the bill would prohibit insurers from requiring prior authorization for
a treatment based solely on cost. Separately, this legislation would make a small
change to require that employers provide timely notice to employees of medications
and treatments covered under their insurers standard health benefit plan, but not
covered under the negotiated terms of the employers bespoke plan; this language
will help ensure employees have full knowledge of what is and what isnt covered
under various employer health benefit plans, and can make a fully educated choice
about which coverage to choose.
This legislation is being introduced with the input and support of the Medical
Society of the District of Columbia. As noted, more than forty states have already
acted to regulate this practice, recognizing the meaningful impact needless delays
and denials of care due to prior authorization practices have on patients health and
wellbeing; of note, those states have not seen meaningful changes in the cost of
medications or care due to regulation this practice. Importantly, with this
legislation, the District will help ensure patients do not face unnecessarily barriers
to timely, medically appropriate care.
Should you have any questions about this legislation, please contact my
Legislative Director, Michael Porcello, at mporcello@dccouncil.us or (202) 724-8062.
Thank you.
Best,
Mary M. Cheh
 1 ________________________________ ______________________________
2 Councilmember Vincent C. Gray Councilmember Mary. M Cheh
3
4
5 ________________________________ ______________________________
6 Councilmember Janeese Lewis George Councilmember Charles Allen
7
8
9 ______________________________
10 Councilmember Anita Bonds
11
12
13 A BILL
14
15 _____________________
16
17 IN THE COUNCIL OF THE DISTRICT OF COLUMBIA
18 ______________________________
19
20
21 To prescribe the manner in which a utilization review entity is to make available information on
22 prior authorization requirements and restrictions; to set notice requirements for prior
23 authorization determinations; to lay out the minimum length that a prior authorization is
24 to be considered valid, to set the qualifications for personnel authorized to make adverse
25 determinations; to permit enrollees to appeal an adverse determination and to set
26 deadlines for submissions of appeals; to set qualifications for personnel authorized to
27 review appeals of adverse determinations; to prescribe utilization review entities'
28 obligations in terms of reviewing requests for prior authorization for non-urgent, urgent,
29 and emergency; to permit utilization review entities to require prior authorization only
30 based on a determination of medical necessity for different care and to prohibit a
31 utilization review entity from requiring prior authorization for a treatment solely based on
32 cost; to prohibit a utilization review entity from revoking, limiting, condition, or
33 restricting a prior authorization if care was provided within 45 days of receipt of the prior
34 authorization; to require that a utilization review entity honor a prior authorization
35 granted by a previous utilization review entity for at least the first 60 days of coverage; to
36 clarify that health services are to be deemed authorized if a utilization review entity fails
37 to comply with this act; and to require utilization review entities using prior authorization
38 to make certain statistics available to the public; to amend the Uniform Health Insurance
39 Claims Forms Act of 1995 to require that, by January 1, 2023, all utilization review
1
40 entities accept and respond to prior authorization requests using the NCPDP SCRIPT
41 Standard ePA transaction; and to amend the Health Insurance Portability and
42 Accountability Federal Law Conformity and No-Fault Motor Vehicle Insurance Act of
43 1998 to require that employers provide notice of employees of treatments, including
44 particular services or medications, not included in a negotiated health benefit plan but
45 including in the standard health benefit plan or formulary offered by the health insurer.
46
47 BE IT ENACTED BY THE COUNCIL OF THE DISTRICT OF COLUMBIA, That this
48 act may be cited as the Prior Authorization Reform Amendment Act of 2022.
49 Sec. 2. Definitions.
50 (a) Adverse determination means a decision by a utilization review entity that the
51 health care services furnished or proposed to be furnished to an enrollee are not medically
52 necessary or are experimental or investigational; and benefit coverage is therefore denied,
53 reduced, or terminated.
54 (b) Emergency health care services means those health care services that are provided
55 in an emergency facility after the sudden onset of a medical condition that manifests itself by
56 symptoms of sufficient severity, including severe pain, that the absence of immediate medical
57 attention could reasonably be expected by a prudent layperson, who possesses an average
58 knowledge of health and medicine, to result in placing the patient's health in serious jeopardy,
59 serious impairment to bodily function, or serious dysfunction of any bodily organ or part.
60 (c) Enrollee means an individual eligible to receive health care benefits by a health
61 insurer pursuant to a health plan or other health insurance coverage. The term enrollee
62 includes an enrollees legally authorized representative.
63 (d) Medication assisted treatment means the use of medications, commonly in
64 combination with counseling and behavioral therapies, to provide a comprehensive approach to
65 the treatment of substance use disorders.
2
66 (e) Prior authorization means the process by which utilization review entities determine
67 the medical necessity or medical appropriateness of covered health care services prior to the
68 rendering of such health care services. Prior authorization also includes any health insurer or
69 utilization review entitys requirement that an enrollee or health care provider notify the health
70 insurer or utilization review entity prior to providing a health care service.
71 (f) Urgent health care service means:
72 (1) A health care service that, in the opinion of a physician with knowledge of the
73 enrollees medical condition, if not receiving an expedited prior authorization:
74 (A) Could seriously jeopardize the life or health of the enrollee or the
75 ability of the enrollee to regain maximum function; or
76 (B) Could subject the enrollee to severe pain that cannot be adequately
77 managed without the care or treatment that is the subject of the utilization review; or
78 (2) Medication assisted treatment.
79 (g) Utilization review entity means an individual or entity that performs prior
80 authorization for one or more of the following entities:
81 (i) An employer with employees in the District;
82 (ii) An insurer that writes health insurance policies;
83 (iii) A preferred provider organization, or health maintenance organization; and
84 (iv) Any other individual or entity that provides, offers to provide, or administers
85 hospital, outpatient, medical, prescription drug, or other health benefits to a person treated by a
86 health care provider in the District under a policy, plan, or contract.
87 Sec. 3. Prior Authorization Requirements and Restrictions.
3
 88 (a)(1) A utilization review entity shall make available any current prior authorization
89 requirements and restrictions, including formulary, (prior authorization requirements) in at
90 least the following ways:
91 (A) Posting of the prior authorization requirements on its website, in a
92 manner accessible to enrollees, health care providers, and the general public and without an
93 account;
94 (B) Emailing or providing a hard copy of the prior authorization
95 requirements to enrollees and health care providers upon request by telephone or in writing,
96 including a request via email; and
97 (C) Providing information on prior authorization requirements, upon
98 request, to enrollees or health care providers over the telephone.
99 (b) Prior authorization requirements shall:
100 (1) Be described in detail and easily understandable language;
101 (2) Include any written clinical criteria;
102 (3) Include a comprehensive listing of all drugs that require a prior authorization;
103 and
104 (4) Include the process for submitting and standards for considering, including
105 evidence-based guidelines, where possible, requests for:
106 (i) A prior authorization;
107 (ii) A reauthorization of a prior authorization after a previous prior
108 authorization has expired, and
109 (iii) Appeals of an adverse determination.
4
110 (c)(1) If a utilization review entity intends either to amend or replace the prior
111 authorization requirements, the changes shall not be deemed effective until the utilization review
112 entitys website has been updated to reflect the new language.
113 Sec. 4. Prior Authorization Determinations.
114 (a)(1) Where a utilization review entity makes a determination to grant or deny a prior
115 authorization, the enrollee and the health care provider submitting the request for a prior
116 authorization must be provided with notice within 24 hours of the determination.
117 (2) Notice provided under this section must include:
118 (A) The name and qualifications, pursuant to Section 6 of this Act, of the
119 personnel making the determination; and
120 (B) For an adverse determination:
121 (i) The grounds under the prior authorization requirements for
122 denying the prior authorization; and
123 (ii) Information on the enrollees right to appeal, the process to file
124 an appeal, and a listing of information necessary to support an appeal of the adverse
125 determination.
126 (c)(1) A utilization review entity shall make information available on its website to
127 enrollees and the enrollees health care provider on active requests for prior authorization and
128 requests made, at a minimum, to that utilization review entity in the preceding five years, and
129 shall include:
130 (A) A copy of any information or materials submitted by the enrollees
131 health care provider to request or support a request for a prior authorization or reauthorization, or
132 appeal an adverse determination; the information or materials shall clearly show the date of any
5
133 submissions by the health care provider, the health care service prescribed by the health care
134 provider, and the basis, if any, provided by the health care provider for the health care service;
135 and
136 (B) A copy of notices of determination provided to the enrollee and health
137 care provider pursuant to subsection (a) of this section;
138 (b) Upon request of the enrollee or health care provider, a utilization review entity shall
139 make information on an adverse determination available via telephone, including the basis under
140 the prior authorization requirements for denying the prior authorization, information on the
141 enrollees right to appeal, the process to file an appeal, and any information necessary to support
142 a successful appeal.
143 Sec. 5. Length of prior authorization.
144 (a) Except for as provided in subsection (b) of this section, a prior authorization for shall
145 be valid for at least one year from the date the health care provider receives the prior
146 authorization. The prior authorization shall remain valid regardless of any changes in dosage for
147 a prescription drug prescribed by the health care provider; provided, that utilization review
148 entities may rescind prior authorization for dosages exceeding limitations set in federal or
149 District law or regulations.
150 (b) If a utilization review entity requires a prior authorization for a health care service for
151 the treatment of a chronic or long-term care condition, the prior authorization shall remain valid
152 for the length of the treatment and the utilization review entity may not require the enrollee to re-
153 obtain a prior authorization for the health care service.
154 Sec. 6. Personnel qualified to make adverse determinations.
6
155 (c) A utilization review entity must ensure that all adverse determinations are made by a
156 physician who:
157 (1) Possesses a current and valid non-restricted license to practice medicine in the
158 District of Columbia;
159 (2) Is of the same specialty as a physician who typically manages the medical
160 condition or disease or provides the health care service involved in the request;
161 (3) Makes the adverse determination under the clinical direction of one of the
162 utilization review entitys medical directors who is responsible for the provision of health care
163 services provided to enrollees in the District of Columbia, and who is licensed in the District of
164 Columbia.
165 Sec. 7. Consultation prior to issuing an adverse determination
166 (a) If a utilization review entity is questioning the medical necessity of a health care
167 service, the utilization review entity must notify the enrollees health care provider that medical
168 necessity is being questioned. Prior to issuing an adverse determination, the enrollees health
169 care provider must have the opportunity to discuss the medical necessity of the health care
170 service on the telephone with the physician who will be responsible for determining
171 authorization of the health care service under review.
172 Sec. 8. Appeals.
173 (a)(1) A utilization review entity shall allow an enrollee to appeal an adverse
174 determination. Any appeal submitted within 15 calendar days of the enrollees receipt of notice
175 of the adverse determination shall be treated as timely.
176 (2) A utilization review entity shall permit an appeal to