Vermont governor signs prior authorization reform bill

Vermont Gov. Phil Scott has signed a bill to reform the prior authorization process in the state.

The legislation aligns prior authorization with Medicaid and claim edits with Medicare. It also allows patients and providers to ask for exemptions to step therapy and requires health insurers to decide prior authorizations within 24 hours for urgent situations and two business days for nonurgent care. It also directs the state's Department of Financial Regulation to prohibit prior authorization requirements for certain medication and services and require insurers to collect cost-sharing amounts from patients. 

Blue Cross Blue Shield of Vermont had raised concerns that the legislation could cause insurance rates to rise between 5% and 7%. Mr. Scott said in a May 20 statement that to alleviate payers' concerns he is directing the state's department of financial regulation and the agency of human services to jointly study the effects of the bill on healthcare outcomes, costs and insurance rates. They are to report back to him on the findings. 

The study will also include a cost impact analysis of prior authorization laws in other states to "evaluate whether they have been successful in improving outcomes and/or reducing health care costs by reducing this burden for providers, and how we can apply successful strategies to the implementation and improvement of this law." 

Mr. Scott is also requesting the Green Mountain Care Board to use its authority to identify cost savings associated with reduced administrative burdens and "ensure these savings pass all the way through to Vermonters in the form of lower costs."

A spokesperson for BCBS Vermont told VTDigger May 20 they appreciate the governor "balancing the concerns of our members by asking that the impacts be analyzed and shared with Vermonters paying premiums," according to the report. 

Most of the legislation will go into effect in January 2025, according to VTDigger. 

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