States Act to Ease Prior Authorization and Improve Transparency

State legislatures have been actively working this year to regulate insurers’ use of prior authorization. 

Since January, nearly a dozen states have enacted laws, strongly supported by state medical societies and the AMA, aimed at reducing care delays and the administrative burden caused by excessive prior authorization requirements. While the specifics of these laws differ by state, they generally aim to reduce the growing number of prior authorization requirements, minimize patient care delays, increase transparency, and mandate the public reporting of data related to prior authorization. 

This year, Vermont, Minnesota, Wyoming, Colorado, Illinois, Mississippi, Maine, Maryland, Oklahoma, and Virginia passed legislation addressing one or more of these issues after advocacy from state medical societies. The AMA backed these efforts with resources, including model legislation and legislative analysis. 

More states, including Massachusetts, may pass laws before the year’s end. In Massachusetts, the legislature is considering a bill that would require new insurers to honor prior authorizations for prescription drugs from a patient’s previous health plan for at least 90 days after enrollment. Additionally, the bill would ensure that prior authorizations for medications and treatments prescribed for chronic conditions remain valid for the length of the prescription, up to 12 months. 

These state-level advancements follow prior authorization reform laws passed last year in the District of Columbia and nine other states. The AMA is committed to fixing prior authorization by urging insurance companies to eliminate delays, reduce patient harm, and ease the administrative burden on healthcare providers. 

Change Approach in Minnesota

In Minnesota, significant prior authorization reforms were enacted in 2020, including shorter response times, mandatory physician involvement in decision-making, and increased transparency. However, the Minnesota Medical Association reported that the situation was still worsening, with prior authorization being required for more procedures and becoming more complex. As a result, new legislation was introduced to further reduce the use of prior authorization, particularly in cancer and mental health care, where delays can be especially harmful. For chronic conditions, prior authorization will no longer expire as long as the treatment remains unchanged, ensuring that patients with conditions like type 2 diabetes or rheumatoid arthritis do not need to reauthorize treatment every six months or annually. These exemptions will take effect in January 2026. 

Additionally, all insurers and utilization-review organizations in Minnesota must report annually to the state health department on their use of prior authorization, standardizing data for better analysis. This new approach will help determine whether certain prior authorization practices, such as requiring approval for services that are nearly always approved, are justified.   

The AMA continues to advocate for critical national and state-level reforms, including gold-carding programs, ensuring that prior authorizations remain valid for chronic conditions, and requiring new health plans to honor prior authorizations from a patient’s previous insurer for at least 90 days. 

 States are Focused on Patient Protection

Across the country, lawmakers are taking significant steps to reduce the burden of prior authorization, with more than 90% of physicians reporting that prior authorization leads to care delays, according to the AMA’s annual survey of 1,000 practicing physicians. 

In Vermont, Governor Phil Scott signed a law allowing patients with chronic conditions to continue receiving treatment without needing repeated prior authorizations if the treatment remains unchanged. The law also mandates that insurers respond to urgent prior authorization requests within 24 hours and requires new insurers to honor prior authorizations from previous plans for up to 90 days. Additionally, physicians and health plans must report the law’s impact to the legislature.   

In Wyoming, lawmakers enacted a law creating a “gold card” program that exempts physicians from prior authorization requirements if they have a consistent record of approvals for specific procedures or medications. The law also extends the validity of prior authorizations for chronic conditions and requires insurers to respond to urgent prior authorization requests within 72 hours and nonurgent requests within five calendar days. Furthermore, it provides a grace period during which insurers must honor prior authorizations from previous plans when a patient switches plans.   

At the federal level, the AMA strongly supports the Improving Seniors’ Timely Access to Care Act of 2024, a bipartisan and bicameral bill that seeks to reform prior authorization processes within Medicare Advantage.