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Senate committee backs prior-authorization overhaul aimed at speeding care; bill moves to appropriations
Summary
Senate Bill 480, a multi-part prior-authorization reform, advanced unanimously and was recommitted to the Appropriations Committee. The bill establishes tiered rules for prior authorization by cost, requires peer reviewers with similar credentials, sets time limits, and bars rescinding positive determinations.
The Senate Health Committee voted unanimously to advance Senate Bill 480, a comprehensive measure designed to reduce administrative delay caused by prior authorization and to set firm timelines and review standards.
Senator Johnson, the bill sponsor, told the committee the proposal reflects extensive stakeholder work over the interim and creates a tiered framework: no prior authorization for drugs under $100; streamlined, electronic bedside prior authorization for drugs costing $100–$5,000; and maintained review structures for higher-cost drugs or services above $5,000. The bill also sets an aggressive cap (1 percent) on the proportion of services and providers subject to prior authorization and would require denials to be made or reviewed by a clinician with similar credentials to the requesting provider.
Witnesses from rural providers and hospitals urged support. Dan Hardesty of the Indiana Rural Health Association praised provisions that require notification of changes to utilization-review requirements and peer reviewers with relevant clinical backgrounds. "We come here today to voice our support for Senate Bill 480 and the effort to streamline the prior authorization process for our rural providers," Hardesty said.
Practicing physicians described the patient-level harm that can follow delays. Dr. Elizabeth Wright, who practiced family medicine for a decade, described cases in which patients did not receive needed medicines because prior authorization processes took days. "When a treatment decision is completed and I discuss that with my patient…and then a prior authorization is required, there are two things that happen. Neither of them are good," Dr. Wright testified, describing delayed treatment and erosion of trust.
The bill contains further protections: prohibiting insurers from rescinding prior authorizations after a positive determination, requiring peer-to-peer reviews by clinicians with similar expertise, and creating notice requirements when payers change prior-authorization rules.
Insurers and PBMs raised concerns about cost implications and ERISA preemption for self-funded employer plans; some business groups also opposed strict caps on prior authorization. The bill's sponsor and the governor’s office negotiated threshold provisions during the interim; the governor's office expressed neutrality while praising some incorporated priorities.
The committee passed the bill 12-0 and recommitted it to the Appropriations Committee for fiscal analysis. Sponsors said significant stakeholder work will continue as the bill progresses toward the floor and possible amendment.
Votes at a glance: Senate Bill 480 — Committee outcome: moved to Appropriations (do pass recommendation); committee vote: 12 yes, 0 no.
Supporters say the measure prioritizes timely patient care and reduces administrative burden; critics say the caps and some requirements raise fiscal and ERISA preemption issues that need further review.
