New Jersey Statutes Title 17B. Insurance 17B § 30-55.2

a. Prior authorization is a type of utilization management technique used by health plans and carriers to ensure safety and appropriateness of medical and pharmacy services, reduce low-value care, and control costs;

b. Providers and patients have raised concerns that the current process of prior authorization is burdensome and leads to care being delayed or abandoned;

c. In 2005, New Jersey enacted the “Health Claims Authorization, Processing and Payment Act” (“HCAPPA”), a groundbreaking law which established uniform procedures and guidelines for hospitals, physicians, and health insurance carriers to follow in communicating and following utilization management decisions and determinations on behalf of patients;

d. In the nearly two decades since HCAPPA was signed into law, the process has continued to be a source of abrasion and concern for providers and patients;

e. The Centers for Medicare and Medicaid Services have recently implemented additional controls on the prior authorization process such as accelerated turnaround times for prior authorization requests from providers, and are currently considering, among other items, ways to improve efficiency in prior authorization, including the use of electronic submission of prior authorization requests;

f. When it is used, prior authorization should utilize an automated process to minimize the burden placed upon both physicians and health plans; and

g. Therefore, because it is fair and reasonable for hospitals and physicians to receive reimbursement for health care services delivered to covered persons under their health benefits plans and inefficiencies in any area of the health care delivery system reflect poorly on all aspects of the health care delivery system, and because those inefficiencies can harm patients, it is appropriate for the Legislature to update now the uniform procedures and guidelines for hospitals, physicians, and health insurance carriers to follow in communicating and following utilization management decisions and determinations on patients' behalf.