Enrolled Copy S.B. 274
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Health Insurance Preauthorization Revisions
2025 GENERAL SESSION
STATE OF UTAH
Chief Sponsor: John D. Johnson
House Sponsor: Katy Hall
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LONG TITLE
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General Description:
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This bill amends provisions related to health insurance preauthorization.
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Highlighted Provisions:
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This bill:
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▸ requires health insurers to provide information related to preauthorization to the
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Department of Insurance, patients, and health care providers; and
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▸ creates a repeal date.
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Money Appropriated in this Bill:
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None
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Other Special Clauses:
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None
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Utah Code Sections Affected:
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AMENDS:
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31A-22-650, as enacted by Laws of Utah 2019, Chapter 439
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63I-1-231, as last amended by Laws of Utah 2023, Chapter 28
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Be it enacted by the Legislature of the state of Utah:
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Section 1. Section 31A-22-650 is amended to read:
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31A-22-650 . Health care preauthorization requirements.
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(1) As used in this section:
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(a) "Adverse preauthorization determination" means a determination by an insurer that
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health care does not meet the preauthorization requirement for the health care.
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(b) "Authorization" means a determination by an insurer that for health care with a
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preauthorization requirement:
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(i) the proposed drug, device, or covered service meets all requirements, restrictions, S.B. 274 Enrolled Copy
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limitations, and clinical criteria for authorization established by the insurer;
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(ii) the drug, device, or covered service is covered by the enrollee's insurance policy;
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and
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(iii) the insurer will provide coverage for the drug, device, or covered service subject
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to the provisions of the insurance policy, including any cost sharing
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responsibilities of the enrollee.
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(c) "Device" means a prescription device as defined in Section 58-17b-102.
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(d) "Drug" means the same as that term is defined in Section 58-17b-102.
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(e) "Insurer" means the same as that term is defined in Section 31A-22-634.
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(f) "Preauthorization requirement" means a requirement by an insurer that an enrollee
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obtain authorization for a drug, device, or service covered by the insurance policy,
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before receiving the drug, device, or service.
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(2)(a) An insurer may not modify an existing requirement for authorization unless, at
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least 30 days before the day on which the modification takes effect, the insurer:
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(i) posts a notice of the modification on the website described in Subsection
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31A-22-613.5(6)(a); and
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(ii) if requested by a network provider or the network provider's representative,
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provides to the network provider by mail or email a written notice of modification
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to a particular requirement for authorization described in the request from the
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network provider.
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(b) Subsection (2)(a) does not apply if:
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(i) complying with Subsection (2)(a) would create a danger to the enrollee's health or
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safety; or
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(ii) the modification is for a newly covered drug or device.
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(c) An insurer may not revoke an authorization for a drug, device, or covered service if:
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(i) the network provider submits a request for authorization for the drug, device, or
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covered service to the insurer;
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(ii) the insurer grants the authorization requested under Subsection (2)(c)(i);
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(iii) the network provider renders the drug, device, or covered service to the enrollee
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in accordance with the authorization and any terms and conditions of the network
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provider's contract with the insurer;
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(iv) on the day on which the network provider renders the drug, device, or covered
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service to the enrollee:
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(A) the enrollee is eligible for coverage under the enrollee's insurance policy; and
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(B) the enrollee's condition or circumstances related to the enrollee's care have not
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changed;
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(v) the network provider submits an accurate claim that matches the information in
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the request for authorization under Subsection (2)(c)(i); and
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(vi) the authorization was not based on fraudulent or materially incorrect information
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from the network provider.
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(3)(a) An insurer that receives a request for authorization shall treat the request as a
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pre-service claim as defined in 29 C.F.R. Sec. 2560.503-1 and process the request in
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accordance with:
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(i) 29 C.F.R. Sec. 2560.503-1, regardless of whether the coverage is offered through
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an individual or group health insurance policy;
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(ii) Subsection 31A-4-116(2); and
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(iii) Section 31A-22-629.
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(b) If a network provider submits a claim to an insurer that includes an unintentional
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error that results in a denial of the claim, the insurer shall permit the network
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provider with an opportunity to resubmit the claim with corrected information within
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a reasonable amount of time.
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(c) Except as provided in Subsection (3)(d), the appeal of an adverse preauthorization
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determination regarding clinical or medical necessity as requested by a physician
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may only be reviewed by a physician who is currently licensed as a physician and
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surgeon in a state, district, or territory of the United States.
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(d) The appeal of an adverse determination requested by a physician regarding clinical
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or medical necessity of a drug, may only be reviewed by an individual who is
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currently licensed in a state, district, or territory of the United States as:
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(i) a physician and surgeon; or
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(ii) a pharmacist.
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(e) An insurer shall ensure that an adverse preauthorization determination regarding
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clinical or medical necessity is made by an individual who:
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(i) has knowledge of the medical condition or disease of the enrollee for whom the
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authorization is requested; or
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(ii) consults with a specialist who has knowledge of the medical condition or disease
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of the enrollee for whom the authorization is requested regarding the request
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before making the determination.
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(f) An insurer shall specify how long an authorization is valid.
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(4)(a) An insurer that removes a drug from the insurer's formulary shall:
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(i) permit an enrollee, an enrollee's designee, or an enrollee's network provider to
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request an exemption from the change to the formulary for the purpose of
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providing the patient with continuity of care; and
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(ii) have a process to review and make a decision regarding an exemption requested
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under Subsection (4)(a)(i).
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(b) If an insurer makes a change to the formulary for a drug in the middle of a plan year,
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the insurer may not implement the changes for an enrollee that is on an active course
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of treatment for the drug unless the insurer provides the enrollee with notice at least
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30 days before the day on which the change is implemented.
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(5)(a) [Before April 1, 2021, and before April 1 of each year thereafter, ] Each April 1,
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an insurer with a preauthorization requirement shall report to the department, for the
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previous calendar year, the percentage of authorizations, not including a claim
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involving urgent care as defined in 29 C.F.R. Sec. 2560.503-1, for which the insurer
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notified a provider regarding an authorization or adverse preauthorization
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determination more than one week after the day on which the insurer received the
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request for authorization.
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(b) Before March 1, 2026, and each March 1 thereafter, an insurer shall report to the
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department the following for the previous calendar year:
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(i) a list of services that have preauthorization requirements;
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(ii) for pre-service preauthorization requests that were not urgent, the percentage of
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individual service requests that:
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(A) were approved;
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(B) were denied;
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(C) were approved after appeal;
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(D) the time frame for review was extended, and the request was approved;
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(E) were denied due to incomplete information from the health care provider; and
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(F) were received through fax, phone, and electronic portal; and
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(iii) for urgent pre-service preauthorization requests, the percentage of individual
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service requests that:
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(A) were approved;
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(B) were denied;
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(C) were denied due to incomplete information from the health care provider; and
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(D) were received through fax, phone, and electronic portal.
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(c) Data provided to the department under Subsections (5)(b)(ii) and (iii) shall be
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aggregated for all services.
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(d) Subsection (5)(b) does not require an insurer to report information regarding
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prescription drugs.
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(e) The department shall compile the information described in Subsection (5)(b) and
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publish the information on the department's website.
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(6) An insurer may not have a preauthorization requirement for emergency health care as
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described in Section 31A-22-627.
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(7) For each adverse preauthorization determination made by an insurer, the insurer shall
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provide to the enrollee and the enrollee's health care provider:
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(a) a detailed and specific explanation that explains why the determination was made;
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and
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(b) a notice explaining the determination may be appealed and the process for appealing
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the determination, including how to begin an expedited appeal process as described
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in Section 31A-22-629.
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(8) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
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department may make rules to implement Subsection (5)(b).
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Section 2. Section 63I-1-231 is amended to read:
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63I-1-231 . Repeal dates: Title 31A.
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(1) Section 31A-2-217, Coordination with other states, is repealed July 1, 2033.
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(2) Subsection 31A-22-650(5)(b), regarding the reporting requirement that includes the
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number of preauthorizations that were approved and denied, is repealed July 1, 2029.
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(3) Subsection 31A-22-650(8), regarding the rulemaking for the preauthorization reporting
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requirement, is repealed July 1, 2029.
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Section 3. Effective Date.
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This bill takes effect on May 7, 2025.
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