Prior authorization and step therapy.
Under existing law, if a health care service plan or other related entity fails to notify a prescribing provider of its coverage determination within a prescribed time period after receiving a prior authorization or step therapy exception request, the prior authorization or step therapy exception request is deemed approved for the duration of the prescription. Existing law excepts contracts entered into under specified medical assistance programs from these time limit requirements.

This bill would delete that exception.

Existing law permits a health care provider or prescribing provider to appeal a denial of a step therapy exception request for coverage of a nonformulary drug, a prior authorization request, or a step therapy exception request, consistent with the current utilization management processes of the health care service plan or health insurer. Existing law also permits an enrollee or insured, or the enrollee’s or insured’s designee or guardian, to appeal a denial of a step therapy exception request for coverage of a nonformulary drug, prior authorization request, or step therapy exception request by filing a grievance under a specified provision.

This bill would require health care service plan’s or health insurer’s utilization management process to ensure that an appeal of an exception request denial is reviewed by a clinical peer of the health care provider or prescribing provider, as specified. The bill would require the appropriate department to consult a clinical peer as an independent expert in reviews of an enrollee’s or insured’s grievance, as specified. The bill would define the term “clinical peer” for these purposes.

The bill would require health care service plans and health insurers that require step therapy or prior authorization to maintain specified information, including, but not limited to, the number of step therapy exception requests and prior authorization requests received by the plan or insurer, and, upon request, to provide the information in a deidentified format to the department or commissioner, as appropriate.