Bill Description: House Bill 611 would limit contractual terms and impose a slew of regulations and reporting requirements on health insurers related to prior authorizations and related matters.
Rating: -4
Does it create, expand, or enlarge any agency, board, program, function, or activity of government? Conversely, does it eliminate or curtail the size or scope of government?
House Bill 611 would create Chapter 35, Title 41, Idaho Code, titled the “Idaho Prior Authorization Reform Act,” but the scope of the act has little do with reform and everything to do with government attempting to centrally plan and micromanage the relationships and contracts between and among health insurers, health care providers, and policyholders.
The act would expand the Department of Insurance’s oversight of private insurers and increase the scope of the department’s enforcement, complaint investigations, fines, reporting requirements, and rulemaking authority.
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Does it give government any new, additional, or expanded power to prohibit, restrict, or regulate activities in the free market? Conversely, does it eliminate or reduce government intervention in the market?
The act would impose a slew of regulations and reporting requirements on health insurers related to prior authorizations and related matters.
It would require every health insurer that uses prior authorization to maintain and publicly post a complete, up-to-date list of every service (including drugs) that requires prior authorization. The list must include the exact clinical review criteria used to make decisions, written in plain language and easily accessible on the insurer’s website or secure portal at the point of care.
Insurers would not be allowed to deny a claim for failure to obtain prior authorization unless that requirement was both in effect on the date of service and publicly disclosed in advance. If an insurer wants to add a new prior-authorization requirement or tighten an existing one, it must give at least 60 days’ written notice to affected enrollees and contracted providers (or post conspicuous notice on its public site), and the website must be updated before the change takes effect.
There are only a few narrow exceptions allowing shorter notice for fraud, scarcity, new FDA-authorized services, or legal mandates.
There are also strict procedural and timeline mandates. By July 1, 2026, every insurer must offer a standardized electronic prior-authorization system (via website, portal, or web-based tool). By January 1, 2027, all providers are required to use that system, and for pharmacy benefits the insurer must accept the “NCPDP SCRIPT” standard.
For non-urgent requests, the insurer must issue an approval or denial within five calendar days (two business days for drugs) after receiving all necessary information. For urgent/expedited requests, the deadline is 24 hours. If the insurer misses any of these deadlines, the requested service is automatically deemed authorized. Once issued, an approval is valid for at least 12 months (or the full length of treatment for chronic conditions such as chemotherapy), and the insurer may not revoke or restrict it except within the narrow exceptions discussed above.
One of the more troubling elements of this act is that new insurers would be required to honor the previous insurer’s prior authorization for at least the first 90 days of coverage.
Any adverse determination must include detailed reasons, the clinical criteria relied upon, appeal instructions, and notice of the right to external review.
The act would regulate who may review appeals and how internal prior-authorization policies are maintained. Appeals filed by a physician must be reviewed by a physician of the same specialty who was not involved in the original denial and who has no financial conflict. Insurers are required to “periodically review” their own prior-authorization requirements and consider removing them.
The act would also create significant ongoing reporting duties. Each year, insurers must publish on their website aggregated statistics on approval/denial rates, appeal success rates, average decision times, and other metrics. Separately, by June 1 each year they must file a detailed report with the Department of Insurance showing the total number of prior-authorization requests, denial rates, appeal rates, reversal rates, the ten services most frequently denied, and the five most common denial reasons. These DOI reports are public records and must be posted on the department’s website without redactions.
Taken together, these provisions would remove insurers’ contractual freedom to design their own utilization-management programs, set their own timelines, decide how long approvals last, choose whether to use electronic systems, or respond to market conditions by tightening or loosening requirements.
Under this act, instead of allowing the market to operate, government would dictate the process, the deadlines, the duration of approvals, the revocation rules, the appeal standards, the technology platform, and the public-disclosure obligations.
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Does it directly or indirectly create or increase penalties for victimless crimes or non-restorative penalties for non-violent crimes? Conversely, does it eliminate or decrease penalties for victimless crimes or non-restorative penalties for non-violent crimes?
The act would allow the Department of Insurance to impose an administrative fine of up to $10,000 per violation on any utilization review organization, health benefit plan, or health insurance issuer it deems to be in violation of this act.
This is in addition to “the enforcement powers granted to it [the department] by law to enforce the provisions of this chapter.”
It also says, “The department may also exercise all authority granted to it under the provisions of chapter 59, title 41, Idaho Code, to deny or revoke approval of a utilization review organization for a violation of this chapter.”
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Does it violate the spirit or the letter of either the United States Constitution or the Idaho Constitution? Examples include restrictions on speech, public assembly, the press, privacy, private property, or firearms. Conversely, does it restore or uphold the protections guaranteed in the US Constitution or the Idaho Constitution?
The act would significantly restrict freedom of contract, which is a fundamental component of liberty and property rights, by limiting voluntary agreements between and among health insurers, health care providers, and policyholders.
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