Health plans would review and report on prior approval rules

Health insurers and utilization review organizations would review prior approval requirements each year and remove some requirements. This applies to health care services that a health benefit plan requires people to get approved in advance. Dental services, pharmacy services, and prescription drugs or supplies are excluded. They must remove a requirement when requests are routinely approved so often that it does not improve care quality or reduce health spending enough to justify the plan’s administrative costs. They may keep a requirement despite at least 80 percent approval if medical or scientific evidence justifies keeping it. The review must happen annually. The text does not specify when the requirement to review begins.

Health insurers and utilization review organizations would send annual prior approval reports to the state Division of Insurance, which would publish them. The reporting rules apply to utilization review organizations and health carriers. The reports go to the South Dakota Division of Insurance. Reports must cover health care services or items in total and include approval and denial counts and percentages, plus average and median decision times. Reports about annual reviews must also describe reviewed and removed requirements, certain retained requirements, request and provider counts, and claim changes of at least 10 percent for services whose approval requirements were removed. Dental services, pharmacy services, and prescription drugs or supplies are excluded. Reports cover the previous calendar year. The division must publish each report within 60 days after receiving it; the text does not specify when reporting begins.