Bill adding exemptions to Kentucky prior authorization requirements clears committee

Legislation framed as way to save doctors and patients time

By: - February 23, 2023 7:37 pm
Doctor showing CT scan to patient in examination room at hospital

Kentucky hospital expenses in 2022, the report says, were $4.2 billion higher than before the pandemic — and they surpassed revenue.(Morsa Images/Getty Images)

A Kentucky health committee passed a bill Thursday that would add exceptions to prior authorization requirements. 

With 18 yes votes and one against, HB 134, framed as a way to save doctors and patients time, can now move to the House floor for a vote. 

That’s despite testimony from insurance representatives who asked legislators to vote no – and related reservations from a few committee members. 

The legislation’s primary sponsor, Rep. Kim Moser, R-Taylor Mill, called prior authorization “an expensive and time consuming layer of bureaucracy” and told her colleagues it can cause delays in care. 

Providing exemptions, she said, can help ease provider burnout as well. 

Prior authorization requires a physician to get permission from a health insurance company before scheduling a medical procedure or treatment or else it will not pay for the cost.

It is, Moser told committee members Thursday, a ”process that health insurance providers employ to determine medical necessity for coverage of a test treatment procedure.”

In the process, “a physician must submit their rationale for prescribing a certain test or treatment to get permission from the insurance company to provide the care that they know that their patients need,” Moser said. “Health care providers spend years training to determine the best course of treatment for their patients. Prior Authorization delays care by often days or longer.” 

Her bill would exempt providers who, over a six-month period, had a 90% or higher prior authorizations approval rate. Sarah Stalker, D-Louisville, is the co-sponsor. 

Such an exemption, she said, “will eliminate the need for health care providers and their staff to spend hours on the phone or behind a computer trying to obtain permission to treat their patient with the care that they know they need, taking time away from patient care.” 

Insurers would be able to audit five to 20 of a provider’s cases twice annually to ensure a pattern of medically necessary decision-making. 

Kentucky Medical Association President Dr. Monalisa Tailor spoke in support of the bill alongside Moser. 

Tailor testified that an internal KMA survey showed 82% of doctors who participated changed or delayed care because of prior authorization requirements. She said the removal of the “unnecessary burden” would allow her to treat more people. 

Dr. Monalisa Tailor, the president of Kentucky Medical Association
Photo by Sarah Ladd

“Delay in care often adds to the time that patients are in pain,” Tailor said, “because diagnostic and therapeutic procedures are being delayed.”

Her testimony is in line with what the American Medical Association says. 

“In today’s physician practice, the prior authorization process is typically manual and time consuming, diverting valuable resources away from patient care,” AMA says. “In addition, prior authorization can delay treatment and impact optimal patient health outcomes.” 

What does the opposition say? 

Several insurance representatives spoke against Moser’s bill before Thursday’s committee. 

The Kentucky Association of Health Plans also opposes the bill as it is now, saying it would lead to “lower medical management standards, risking patient safety and opening the door to more low-value, inappropriate, and fraudulent care.” 

“To avoid conflicting requirements, Kentucky should defer any legislative or regulatory action while these new federal rules are being finalized this year,” Tom Stephens, president and CEO of KAHP, said in a statement after the passage. 

“A more constructive focus would be to encourage more providers to submit electronically, rather than by fax,” Stephens said. 

Dr. Eric Gratias with eviCore Healthcare testified over Zoom that changing plans for care is “actually good for that patient” as it allows for the most up-to-date care. 

“Medical evidence is continuing to evolve at an ever-increasing rate,” Gratias told legislators. Prior authorization, he added, is meant to fill knowledge gaps.

“Gold-carding in itself is based on a flawed premise. It’s based on the premise that any physician anywhere no matter how good they are, no matter how hard they try, can keep up with the changes of evidence-based medicine,” Gratias said. (“Gold carding” refers to the prior authorization exemptions). 

Gratias said prior authorization actually “removes delays in care when patients are going down the wrong path.” 

Others testified that some streamlining is needed and could be helpful. But, they felt, the legislation as it stands was premature. 

Some took issue with the 90% prior authorization approval requirement, with Gratias calling the remaining 10% an “error rate.” 

“Find me a clinic, find me a hospital, find me a nursing home, find me anybody that thinks even the 2% error rate in patient care decision making is safe or good or acceptable,” Gratias said.  

Moser said it’s an incorrect assumption that the 10% represents mistakes or medical errors. 

“That is not an error rate,” she said. “That 10% was misconstrued as an error rate. I know that most physicians and other health care providers who prescribe treatments often have a 99% rate.” 

“A lot of times that 10% is,” she said, “not approved the first time and it’s approved on appeal. So that counts as a non-approval.” 

And, she added: “I am absolutely willing to work with the insurers on this. I know that there is a lot that we can do.” 

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Sarah Ladd
Sarah Ladd

Sarah Ladd is a Louisville-based journalist from West Kentucky who's covered everything from crime to higher education. She spent nearly two years on the metro breaking news desk at The Courier Journal. In 2020, she started reporting on the COVID-19 pandemic and has covered health ever since. As the Kentucky Lantern's health reporter, she focuses on mental health, LGBTQ+ issues, children's welfare, COVID-19 and more.

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