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Committee hears SB 9 to align Nevada law with federal third-party liability rules for Medicaid claims
Summary
SB 9 would require third-party insurers to respond to state inquiries about claims for Medicaid enrollees within 60 days and prohibit denials based solely on lack of prior authorization where the state authorized the service, aligning state law with federal changes.
CARSON CITY — The Senate Committee on Commerce and Labor heard testimony on SB 9, a bill to revise Nevada law so third-party insurers must respond more promptly to state inquiries about claims for Medicaid enrollees and to prevent denials based solely on lack of prior authorization when a state agency has authorized the service.
Stacy Weeks, administrator at the Division of Health Care Financing and Policy, introduced the measure and said Cynthia Leach, the division's compliance officer, would present the details. Leach told the committee SB 9 is intended to bring Nevada into compliance with federal changes made by the Consolidated Appropriations Act of 2022. "Provision 1 requires insurers who cover Medicaid eligibles to respond to an inquiry regarding a claim for payment for provision for the provision of any medical item or service not later than 60 days after receiving the inquiry," Leach said. She summarized the second federal requirement as barring denials based solely on lack of prior authorization when the state agency authorized the item or service.
Leach explained how Nevada Medicaid currently uses a contractor, Health Management Systems (HMS), to identify and recover third-party payments after Medicaid has paid a claim (a "pay and chase" recovery) and to do cost-avoidance work when third-party coverage is known before billing. She told the committee the pay-and-chase recoveries are sometimes slow or unsuccessful because carriers will argue a prior-authorization denial despite state authorization. The bill would revise state law to require timelier insurer responses and create a clearer route for the state to obtain reimbursement from legally responsible third parties.
Committee members asked how the change would affect Medicaid recipients. "A recipient should see no difference," Leach said, adding that the changes operate behind the scenes and should reduce administrative burden for providers and the state. Carissa Pierce of the Children's Advocacy Alliance testified in support, saying the bill would reduce administrative burden and help providers feel reassured they will be paid for services provided to Medicaid enrollees.
No witnesses testified in opposition at the hearing, and no committee vote was taken. The chair closed the hearing on SB 9 after testimony and questions.
Notes: This article summarizes committee testimony and the presenters' descriptions of the bill; implementation details and timelines were not specified in the hearing record.
