See bold text below:

(a) Health plans shall pay claims for health care services for which prior authorization was required by and received from the health plan, unless:

(1) the insured was not a covered individual at the time the service was rendered;

(2) the insured’s benefit limitations were exhausted;

(3) the prior authorization was based on materially inaccurate information from the health care provider;

(4) the health plan has a reasonable belief that fraud or other intentional misconduct has occurred; or

(5) the health plan determines through coordination of benefits that another health insurer is liable for the claim.

(b) Notwithstanding the provisions of subsection (a) of this section, nothing in this section shall be construed to prohibit a health plan from denying continued or extended coverage as part of concurrent review, denying a claim if the health plan is not primarily obligated to pay the claim, or applying payment policies that are consistent with an applicable law, rule, or regulation.

(c) A health plan shall furnish, upon request from a health care provider, a current list of services and supplies requiring prior authorization.

(d) A health plan shall post a current list of services and supplies requiring prior authorization to the insurer’s website.

(e) In addition to any other remedy provided by law, if the Commissioner finds that a health plan has engaged in a pattern and practice of violating this section, the Commissioner may impose an administrative penalty against the health plan of no more than $500.00 for each violation, and may order the health plan to cease and desist from further violations and order the health plan to remediate the violation. In determining the amount of penalty to be assessed, the Commissioner shall consider the following factors:

(1) the appropriateness of the penalty with respect to the financial resources and good faith of the health plan;

(2) the gravity of the violation or practice;

(3) the history of previous violations or practices of a similar nature;

(4) the economic benefit derived by the health plan and the economic impact on the health care facility or health care provider resulting from the violation; and

(5) any other relevant factors.

(f) Nothing in this section shall be construed to prohibit a health plan from applying payment policies that are consistent with applicable federal or State laws and regulations, or to relieve a health plan from complying with payment standards established by federal or State laws and regulations.

(g)(1)(A) Notwithstanding any provision of law to the contrary, on and after March 1, 2014, when requiring prior authorization for prescription drugs, medical procedures, and medical tests, a health plan shall accept for each prior authorization request either:

(i) the national standard transaction information, such as HIPAA 278 standards, for sending or receiving authorizations electronically; or

(ii) a uniform prior authorization form developed pursuant to subdivisions (2) and (3) of this subsection (g).

(B) A health plan shall have the capability to accept both the national standard transaction information and the uniform prior authorization forms developed pursuant to subdivisions (2) and (3) of this subsection (g).

(2)(A) Not later than September 1, 2013, the Department of Financial Regulation shall develop a clear, uniform, and readily accessible prior authorization form for prior authorization requests for medical procedures and medical tests.

(B) Not later than September 1, 2013, the Department of Financial Regulation shall develop clear, uniform, and readily accessible forms for prior authorization requests for prescription drugs after determining the appropriate number of forms.

(3) Each uniform prior authorization form developed pursuant to subdivision (2) of this subsection shall meet the following criteria, where applicable:

(A) The form shall include the core set of common data requirements for nonclinical information for prior authorization included in the HIPAA 278 standard transaction, national standards for prior authorization and electronic prescriptions, or both. The Department shall revise the form as needed to ensure that national standards are adopted and incorporated as soon as such standards are available and final.

(B) The form shall be made available electronically by the Department and by the health plan.

(C) The completed form or its data elements may be submitted electronically from the prescribing health care provider to the health plan.

(D) The Department shall develop the form in consultation with the Department of Vermont Health Access and with input from interested parties from at least one public meeting.

(E) The Department shall consider input on the proposed form from the national ASC X-12 workgroup, if available.

(F) In developing the uniform prior authorization forms, the Department shall take into consideration the following:

(i) existing prior authorization forms established by the federal Centers for Medicare and Medicaid Services, by the Department of Vermont Health Access, and by insurance and Medicaid departments and agencies in other states; and

(ii) national standards related to electronic prior authorization.

State Medical Necessity Decisions-Deadlines

(4) A health plan shall respond to a completed prior authorization request from a prescribing health care provider within 48 hours after receipt for urgent requests and within two business days after receipt for non-urgent requests. The health plan shall notify a health care provider of or make available to a health care provider a receipt of the request for prior authorization and any needed missing information within 24 hours after receipt. If a health plan does not, within the time limits set forth in this section, respond to a completed prior authorization request, acknowledge receipt of the request for prior authorization, or request missing information, the prior authorization request shall be deemed to have been granted.

(h)(1) A health plan shall review the list of medical procedures and medical tests for which it requires prior authorization at least annually and shall eliminate the prior authorization requirements for those procedures and tests for which such a requirement is no longer justified or for which requests are routinely approved with such frequency as to demonstrate that the prior authorization requirement does not promote health care quality or reduce
health care spending to a degree sufficient to justify the administrative costs to the plan.

(2) A health plan shall attest to the Department of Financial Regulation and the Green Mountain Care Board annually on or before September 15 that it has completed the review and appropriate elimination of prior authorization requirements as required by subdivision (1) of this subsection.

Section 9 of H. 960, enacted in 2020, states as follows:

Prior Authorization; Electronic Health Records; Report

On or before January 15, 2022, the Department of Financial Regulation, in consultation with health insurers and health care provider associations, shall report to the House Committee on Health Care, the Senate Committees on Health and Welfare and on Finance, and the Green Mountain Care Board opportunities to increase the use of real-time decision support tools embedded in electronic health records to complete prior authorization requests for
imaging and pharmacy services, including options that minimize cost for both health care providers and health insurers.

Section 10 of H. 960, enacted in 2020, states as follows:

Prior Authorization; All-Payer ACO Model; Report

The Green Mountain Care Board, in consultation with the Department of Vermont Health Access, certified accountable care organizations, payers participating in the All-Payer ACO Model, health care providers, and other interested stakeholders, shall evaluate opportunities for and obstacles to aligning and reducing prior authorization requirements under the All-Payer ACO Model as an incentive to increase scale, as well as potential opportunities to waive additional Medicare administrative requirements in the future. On or before January 15, 2022, the Board shall submit the results of its evaluation to the House Committee on Health Care and the Senate Committees on Health and Welfare and on Finance.

Section 11 of H. 960, enacted in 2020, states as follows:

Prior Authorization; Gold Carding; Pilot Program; Pilot

(a) On or before January 15, 2022, each health insurer with more than 1,000 covered lives in this State for major medical health insurance shall implement a pilot program that automatically exempts from or streamlines certain prior authorization requirements for a subset of participating health care providers, some of whom shall be primary care providers.

(b) Each insurer shall make available electronically, including on a publicly available website, details about its prior authorization exemption or streamlining program, including:

(1) the medical procedures or tests that are exempt from or have streamlined prior authorization requirements for providers who qualify for the program;

(2) the criteria for a health care provider to qualify for the program;

(3) the number of health care providers who are eligible for the program, including their specialties and the percentage who are primary care providers; and

(4) whom to contact for questions about the program or about determining a health care provider’s eligibility for the program.

(c) On or before January 15, 2023, each health insurer required to implement a prior authorization pilot program under this section shall report to the House Committee on Health Care, the Senate Committees on Health and Welfare and on Finance, and the Green Mountain Care Board:

(1) the results of the pilot program, including an analysis of the costs and savings;

(2) prospects for the health insurer continuing or expanding the program;

(3) feedback the health insurer received about the program from the health care provider community; and

(4) an assessment of the administrative costs to the health insurer of administering and implementing prior authorization requirements.

Section 12 of H. 960, enacted in 2020, states as follows:

Prior Authorization; Provider Exemptions; Report

On or before September 30, 2021, the Department of Vermont Health Access shall provide findings and recommendations to the House Committee on Health Care, the Senate Committees on Health and Welfare and on Finance, and the Green Mountain Care Board regarding clinical prior authorization requirements in the Vermont Medicaid program, including:

(1) a description and evaluation of the outcomes of the prior authorization waiver pilot program for Medicaid beneficiaries attributed to the Vermont Medicaid Next Generation ACO Model;

(2)(A) for each service for which Vermont Medicaid requires prior authorization:

(i) the denial rate for prior authorization requests; and

(ii) the potential for harm in the absence of a prior authorization requirement;

(B) based on the information provided pursuant to subdivision (A) of this subdivision (2), the services for which the Department would consider:

(i) waiving the prior authorization requirement; and

(ii) exempting from prior authorization requirements those health care professionals whose prior authorization requests are routinely granted;

(3) the results of the Department’s current efforts to engage with health care providers and Medicaid beneficiaries to determine the burdens and consequences of the Medicaid prior authorization requirements and the providers’ and beneficiaries’ recommendations for modifications to those requirements;

(4) the potential to implement systems that would streamline prior authorization processes for the services for which it would be appropriate, with a focus on reducing the burdens on providers, patients, and the Department;

(5) which State and federal approvals would be needed in order to make proposed changes to the Medicaid prior authorization requirements; and

(6) the potential for aligning prior authorization requirements across payers.

See https://legislature.vermont.gov/statutes/section/18/221/09418b

To access H. 960, go to https://legislature.vermont.gov/Documents/2020/Docs/ACTS/ACT140/ACT140%20As%20Enacted.pdf