Weekly StateVitals Update: Volume 18 (May 5, 2025)
National
HHS Secretary Announces State-Federal Partnership Opportunities at NCOIL. At the recent National Council of Insurance Legislators (NCOIL), U.S. Department of Health and Human Services Secretary Robert F. Kennedy, Jr., unveiled a pilot alternative payment model that would provide coverage for gene therapy treatment of sickle cell disease. Notably, the Secretary specified that this was made possible through agreement reach in negotiations with drug manufacturers. It’s a model that the secretary notes 35 states have already applied for and would be run out of the Centers for Medicare & Medicaid (CMS) Innovation Center. The Secretary also announced the intent of Medicaid to begin covering embryo preservation with the intent to ensure more individuals had access to in vitro fertilization services. On the latter, more information is needed to understand how such coverage would work but may be an optional covered benefit for states.
NCOIL Signs Off and Introduces Significant Healthcare Model Legislation. At its recent meeting in Charleston, NCOIL’s Health Care and Long-Term Services Committee voted to adopt the Improving Affordability for Patients Model Act (p. 88). The measure pulled across the finish line by Rep. Tom Oliverson (R-TX) provides for a prohibition of healthcare systems from imposing facility fees for outpatient services and to require healthcare facilities to enhance transparency on its billing mechanisms at hospital-owned facilities. Additionally, Sen. Walter Michel (R-MS) introduced Prior Authorization model legislation (p. 70). As introduced at this meeting, the draft model legislation would enhance disclosure and transparency requirements on insurers to disclose a complete list of services that prior authorization is required for, establish standardization for clinical review criteria, provide for advance notification requirements by insurers of any new prior authorization requirements, and establish timeline requirements for when urgent and nonurgent prior authorization determinations must be made by the insurer, among other provisions. The intent is to continue working on the model legislation at NCOIL’s summer meeting in July.
Arizona
Governor Signs Provider Credentialing Bill into Law. Following a brief holdout on signing any legislation into law until the Legislature authorized appropriations for the Division of Developmental Disabilities, Governor Katie Hobbs (D) signed a number of healthcare-related legislation into law. Most notable was SB 1291. The measure requires health insurers to conclude the process of credentialing a provider and providing them in-network status within 60 calendar days and loading that provider into the insurer’s billing system within 30 calendar days following that approval. The bill also requires the insurer to provide the provider with notification of receipt of a credentialing application seven calendar days after receipt, among other provisions. It’s likely additional healthcare measures will be on the table for consideration as the Legislature looks to an adjournment date of May 9.
Colorado
Governor Expected to Sign Non-Compete Prohibition for Healthcare Professionals. Following passage of SB 25-083 by the Legislature in late April, it’s expected that Governor Jared Polis (D) will sign the measure into law. The bill would prohibit health systems and other organizations from implementing a restrictive covenant if it prohibits or materially restricts a health care provider from disclosing to existing patients the provider’s continuance of practicing medicine, their new contact information and the patient’s right to choose a healthcare provider based on that information. The bill also authorizes the purchase or sale of a business exception to the sale or business’s assets to waive a noncompete if the noncompete is related to the sale of a business. Assuming the Governor does is expected, the bill would go into effect August 6, 2025.
California
Prior Authorization Measures Advance Out of Committee. A trio of prior authorization reform bills have advanced out of the Senate and Assembly health committees recently. Notably, AB 510 would authorize a provider to request review of any denial, delay or modification based on a prior authorization request to be reviewed by a licensed physician and would require such reviews to occur within two business days. Additionally, AB 512 would require that prior or concurrent authorization requests must be fulfilled within 48 hours for standard requests and 24 hours for urgent requests. Finally, AB 539 would require a prior authorization for a service to remain valid for at least one full year from the date of approval or throughout the course of prescribed treatment, if less than a year. The three bills have now been referred to the Committee on Appropriations for consideration.
Florida
Legislature Enrolls Fluoride Ban Bill. This past week, the Legislature gave its final approval with a state House vote of 88 to 27 to pass SB 700, otherwise known as the Florida Farm Bill. Part of a larger omnibus, included is a provision that prevents the use of certain additives in a public water system, inclusive of the chemical compound. Similar as to how this bill played out in Utah, the first state to enact legislation banning fluoride in water systems, the healthcare and dental community were largely opposed to the measure while water conservancy and local governing districts largely spoke in favor of the bill throughout the committee hearing process. The bill now goes to Governor Desantis (R) for his signature, which he’s expected to provide. While Florida would join Utah in banning fluoride outright, proposals in Arkansas and Kentucky both failed and proposals in Nebraska, Wisconsin and North Carolina remain alive but are not expected to advance.
Iowa
Senate Passes PBM Reform Measure. This past week, the Iowa Senate adopted by a 36 to 14 margin SF 383. The bill includes a multitude of provisions related to how pharmacy benefits managers (PBMs) must operate in the state. Notably, it would require that pharmacies are reimbursed at the national or state average acquisition drug cost. Additionally, it would prohibit PBMs from certain practices including patient steering, network denial to pharmacists if certain conditions are met, unreasonably designating a prescription drug as a specialty drug, requiring covered enrollees to access drugs only through mail-order pharmacies, and other practices. The bill now heads over to the House for consideration where it will have some allies in leadership encouraging it to move.
Senate Attempts to Prohibit Medicaid Funding for Gender Dysphoria Treatments. Despite a 2019 Iowa Supreme Court ruling that has ruled similarly previous laws unconstitutional in the past, a Senate Appropriations Subcommittee opted to advance Senate Study Bill 1237 for inclusion in the Senate’s Health and Human Services appropriations package that would prohibit the use of Medicaid funds for sex reassignment surgery or treatment related to an individual’s gender dysphoria diagnosis. However, earlier this year, Governor Kim Reynolds (R) signed into law a measure passed by the Legislature that removed gender identity as a protected class under the Iowa Civil Rights Act, which may provide ground for the state to pursue this law despite former court rulings. It’s unclear whether the House would accept this language as part of an agreed upon appropriations package.
Missouri
Senate Committee Advances Constitutional Amendment on Reinstating Abortion Ban. Following passage by the House two weeks ago and a vote of support by the Senate Committee on Families, Seniors and Health this past week, HJR 73 will head to the Senate floor for a final vote before it can get on the ballot to voters. The constitutional amendment would ban most all abortion care in the state. Under the measure as it currently is written, it would reinstate a near-total abortion ban except for cases of medical emergencies, fatal fetal anomalies and for survivors of rape and incest, if such abortion care were rendered within the first 12 weeks of gestation. If it does receive Senate approval, it would be expected to go on the ballot in 2026.
Nevada
Senate Passes Bill Limiting AI in Prior Authorizations. The Senate this past week sent SB 128 over to the Assembly for consideration. As enrolled, the bill would prohibit health insurers from using artificial intelligence or another automated decision tool to deny or modify a request for prior authorization, reduce the scope of service or amount of coverage in a prior authorization request, or terminate or modify in any way existing coverage for a previously approved prior authorization. The bill also requires peer-to-peer evaluation for any adverse determinations made by insurers on prior authorization requests. This bill follows a trend of about 12 states that have proactively discussed regulating AI in prior authorization practices this past year. The bill is expected to be considered by the Assembly.
North Carolina
House Passes Significant Prior Authorization Reform. This past week, the House of Representatives voted nearly unanimously in favor of HB 434. As enrolled, the measure would provide for numerous reforms to insurers’ utilization of prior authorization practices, including:
Establishes a gold carding program for providers if there is at least an 80 percent approval threshold met within a recent 12-month period for services.
Establishes standards for clinical review criteria that all insurers must adhere to.
Establishes a requirement that if an insurer is questioning the medical necessity of a healthcare service, that enrollee’s provider must be notified within five business days to review the service in question.
Establishes transparency requirements for insurers to make lists of healthcare services subjected to prior authorization requirements available.
Requires that insurers must render a determination on a prior authorization request within 48 hours for non-urgent requests, 24 hours for urgent requests, and establishes specific criteria related to all utilization review practices for emergency services.
Establishes limitations on retrospective denials.
Requires all appeals of adverse determinations to be reviewed by a medical doctor who meets certain specifications.
The bill now heads to the Senate who is entertaining their own bills relative to prior authorization. While its unlikely to come out from the Senate as it is currently written, it remains likely that some prior authorization reform measure will be enrolled this session.
Texas
Texas House Committee Reports AI Bill Favorably Out of Committee. The Texas House Committee on Insurance reported favorably out of committee this week SB 815. The bill would prohibit insurers from using an automated decision system to make any adverse determination and would authorize the Insurance Commissioner to audit and inspect an insurer’s use of an automated decision system for utilization review at any time. The bill had previously passed the full Senate and will now make its way to the Calendar Committee for consideration on the House floor’s agenda.
Senate Approves Bill Clarifying Medical Exceptions to Abortion Ban. The Texas Senate voted to unanimously approve a bill (SB 31) this past week that would provide clarity in what medical exceptions to the state abortion ban existed. The bill specifies that physicians are allowed to perform an abortion if a patient is experiencing a life-threatening condition that may cause death. With support from advocates to ensure this clarity was provided to physicians, Democrats opted to join their Republican colleagues in support of the bill. This came after nearly two years of reporting about physicians who were confused about how to practice and provide abortion care with the current ban in place. The bill now goes to the House for consideration.
Senate Approves Bill Outlawing the Distribution of Abortion Pills in Texas. This past week, the Senate voted 19 to 11 to approve SB 2880. The bill would expand existing law that provides for a private enforcement mechanism against anyone that mails or distributes abortion pills within state or through state boundaries, inclusive of manufacturers. Under this bill, it would allow a private right of enforcement to sue for up to $100,000 for anyone who manufactures, mails or delivers abortion pills to or for someone in Texas. Notably, the bill also would extend the statute of limitations for an abortion-related wrongful death case to six years and place legal liabilities on both the court system and petitioning attorneys for challenging the law. The bill will next go to the House for consideration.
Vaccine Exemption Bill Moves Out of Committee. The Texas House Public Health Committee voted by a 7 to 6 margin to advance HB 1586 out of committee and to the Calendar Committee for consideration on the House floor. The bill, sponsored by Rep. Lacey Hull (R-Houston), would require that the state’s current exemption form for any vaccine exemption request for an acceptable exemption setting must be available for download as a PDF on the state’s Department of State Health Services website. Current practice requires individuals seeking an exemption to contact the Department of State Health Services directly to have an exemption form mailed to the applicant’s home address. As recently reported, the requests to the state health agency for exemption forms have doubled from 45,900 to 93,000 between 2018 and 2024. It’s unclear whether House Leadership will opt to take up the bill for a vote on the floor at this time.
House Provides First Approval on Resolution to Fund Dementia Research. This past week, the Texas House of Representatives voted to approve Senate Joint Resolution 3 by a vote of 123 to 21. The constitutional amendment would send the question to Texas voters on a forthcoming ballot as to whether the state should appropriate $3 billion to a previously legislatively-established Dementia Prevention and Research Institute of Texas for the purposes of studying dementia, Alzheimer’s disease, Parkinson’s disease and other conditions. The bill now just needs Senate concurrence to go to the ballot.
Washington
Legislature Enrolls Measure to Standardize Mental Health Coverage. When the Washington Legislature wrapped up its work, the Legislature enrolled HB 1432. As enrolled, the bill prohibits health insurers from requiring utilization management tools to be applied for an initial evaluation and management visit and up to six treatment visits in a new episode of care for outpatient mental health care office visits and outpatient substance use disorder care office visits. The bill further establishes standardized clinical review criteria that must be used by insurers for mental health treatment services and prescription drugs related to mental health diagnoses. The Governor is expected to sign the bill into law.
