Indiana Senators Approve Prior Authorization Bill and Child Care Regulations

Indiana Senators have passed Senate Bill 2 and Senate Bill 3 to relax child care laws and reduce prior authorization delays. Among numerous changes, Bill 2 would make child care workers eligible for public child care subsidies, while Bill 3 would require practicing physicians of the same specialty to review PA requests on behalf of insurers.

The bills, which were approved unanimously by the Senate health committee on Wednesday, are part of the Republican Senate caucus’s agenda for the 2024 legislative session. They aim to address the challenges faced by Hoosier families and health care providers amid the COVID-19 pandemic and beyond.

• Senate Bill 2: Child Care Regulations

Senate Bill 2, authored by Sen. Ed Charbonneau (R-Valparaiso), would make several changes to the state’s child care regulations, with the aim to increase the availability and affordability of child care options for low-income families and workers.

It would make child care workers categorically eligible for Temporary Assistance for Needy Families (TANF) benefits, regardless of their income or assets. This would allow them to access public child care subsidies, such as the Child Care and Development Fund (CCDF), which helps low-income families pay for child care services. The bill would also increase the income eligibility limit for CCDF from 127% to 150% of the federal poverty level, which would expand the number of families who can qualify for the program.

The bill would also allow child care providers to operate without a license if they care for no more than five children, excluding their own, and do not receive any public funding. The bill would also exempt these providers from certain health and safety regulations, such as immunization requirements, background checks, and inspections. The bill would also allow licensed providers to care for up to 12 children, instead of 10, and to operate for up to 12 hours a day, instead of 10.

Charbonneau said his bill is intended to address the shortage of child care options in Indiana, especially in rural areas, and to support low-income families and workers. He said the bill would also reduce the administrative burden and cost for child care providers, and encourage more people to enter the field.

Senate Bill 2 was supported by over a dozen advocacy organizations, child care provider associations, and government officials, who testified that the bill would help meet the growing demand and need for child care services in the state. They said the bill would also improve the quality and accessibility of child care services, and promote the well-being and development of children.

However, the bill was opposed by some child care advocates, who expressed concerns about the potential risks and harms of relaxing the child care regulations. They said the bill would compromise the health and safety of children, and lower the standards and accountability of child care providers. They also said the bill would create a two-tiered system of child care, where low-income families and workers would have fewer choices and protections than higher-income families and workers.

• Senate Bill 3: Prior Authorization Reform

Senate Bill 3, authored by Sen. Tyler Brown (R-Leo), would make several changes to the prior authorization process, with the goal of reducing the delays and denials of health care services for patients and providers.

Prior authorization is a process that requires health care providers to obtain approval from health insurers before performing a service, prescribing a medication, or ordering a test for their patients. It is used by insurers to control costs and ensure appropriate utilization of health care resources, but the UM process is also criticized by providers and patients for creating administrative burden, interfering with clinical decision-making, and delaying or denying access to necessary care.

The bill would make the following changes to the prior authorization process:

• It would eliminate prior authorization altogether for emergency services, routine care, and common prescription drugs. It would also set an overall cap on prior authorization, so that insurers could require PA for no more than 1% of providers and 1% of any given service.
• Insurers will have to respond to prior authorization requests within 48 hours for urgent care services and within five business days for non-urgent care services. If insurers fail to respond within the specified time frame, the request would be deemed approved.
• Insurers must also provide a reason for denying a prior authorization request and inform the provider of the appeal process. Providers would have the right to appeal a denial and request an expedited review if the patient’s health is at risk.
• Senate Bill 3 would require insurers to use practicing physicians of the same medical specialty to review prior authorization requests, instead of using algorithms or non-physician staff. It would also require insurers to disclose the qualifications and credentials of the reviewers.
• The bill would require insurers to maintain an updated list of services that require prior authorization and make it available on their website. Providers could also request a list of services that require prior authorization for a specific patient or plan.
• Payers are also expected to honor prior authorization approvals for at least 45 days or until the patient’s coverage terminates, whichever is shorter. Insurers cannot revoke or modify a prior authorization approval unless there is evidence of fraud, misrepresentation, or clinical changes.
• The bill would require insurers to adopt electronic prior authorization standards and use a secure web portal or electronic health record system to accept and process prior authorization requests. Providers could also submit prior authorization requests by phone, fax, or mail.

Brown, who is an emergency physician, said his bill is intended to address the problems and challenges of prior authorization, which he said has become “blatantly wasteful” and “(gets) in the way of good patient care.” He said his bill would protect the rights and interests of patients and providers, and ensure timely and appropriate access to health care services.

The bill was supported by several physicians, who testified about the limitations and frustrations of prior authorization, and how it affects their practice and their patients. They said the bill would reduce the administrative burden and cost for providers, and improve the quality and efficiency of care for patients.

However, the bill was opposed by some insurers and employers, who expressed concerns about the potential impacts and consequences of the bill on health care costs and utilization. They said the bill would undermine the role and value of prior authorization, which they said is a necessary and effective tool to manage health care resources and promote cost-effective alternatives. They also said the bill would increase the premiums and expenses for plan sponsors and consumers, and create unintended incentives and disparities in the health care system.