The Mississippi Senate this week unanimously passed a bill to regulate how insurance companies decide which medical procedures or prescription drugs to cover for a consumer — a process called “prior authorization.”
Senate Insurance Committee Chairman Walter Michel said the legislation grew out of complaints he received from both physicians and insurance companies about how the authorization process currently works.
Prior authorization is when physicians have to seek advance approval from an insurance company before the company covers a prescribed procedure, service or medication that is not an emergency.
If an insurance organization denies a prior authorization claim, a consumer could be forced to pay for a prescription or medical procedure out of pocket.
“What we don’t want to happen is an adversarial relationship between a doctor and a patient,” Michel told reporters. “It’s to everyone’s advantage to get the prior approval from the insurance company to know the procedure is going to be paid for.”
Insurance companies typically believe prior authorization helps ensure doctors only provide medically necessary services, while doctors argue the process is typically handled by clerical insurance staffers ill-equipped to understand medical procedures.
The Senate proposal would require insurance companies to create a “portal” or website by January 2025 for doctors to submit prior authorization applications.
For emergency services like treating a heart attack, prior authorization is not required. For urgent services or procedures that can help treat someone in intense pain, insurance companies have 24 hours to process requests. For non-urgent services, insurance companies have five days.
The state Insurance Commission is responsible for regulating the program and can fine people up to $10,000 for violating the law.
Republican Insurance Commissioner Mike Chaney told Mississippi Today that he can “live with” the Senate proposal, but he would like for the Legislature to appropriate more money to the insurance commission to enforce the program.
The bill passed without any dissenting vote, and it moved to the House for more work. The House Public Health Committee passed a similar measure this week, but the entire House chamber has not yet considered the proposal.
Republican Gov. Tate Reeves last year vetoed a similar measure that the Legislature passed by a wide majority. The governor, at the time, believed the proposal would increase health care costs in the state.
Corey Custer, Reeves’ deputy chief of staff, told Mississippi Today in a statement that the governor’s office has worked with necessary stakeholders to address some of his concerns in last year’s version of the bill.
“The proposed legislation reflects a series of compromises by many of those stakeholders,” Custer said. “Gov. Reeves looks forward to working with the legislature to move prior authorization reform through the legislative process.”
Michel, a Republican from Ridgeland who wrote the bill, believes his latest proposal satisfies the governor’s concerns from last year.
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