RELATING TO INSURER PRIOR AUTHORIZATION.

SB2282

THE SENATE

S.B. NO.

2282

THIRTY-THIRD LEGISLATURE, 2026

STATE OF HAWAII

A BILL FOR AN ACT

relating
to insurer prior authorization
.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

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SECTION 1.
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The legislature finds that health care
insurance prior authorization for treatment processes in Hawaii pose
significant challenges, which have been reported to delay treatment, negatively
impact patient outcomes, and impose considerable administrative burdens on health
care providers.
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Physicians and staff
spend excessive time navigating these requirements, detracting from direct
patient care.
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The legislature finds that
studies and legislative actions have highlighted concerns over the timeliness
and efficiency of health care delivery under these procedures.

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The
legislature further finds that streamlining prior authorization requirements to
reduce delays and align with national best practices will enhance patient care,
reduce administrative burdens, and ensure timely access to medical services,
ultimately improving health outcomes and positioning Hawaii as a leader in health
care reform.

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The
purpose of this Act is to:

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(1)
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Establish
a list of medical conditions for which authorization by a health insurance
company for health insurance coverage is not required before treatment;

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(2)
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Require
health insurers to align their procedures with comparable procedures
established by medicare's guidelines for an insured to obtain authorization
from a health insurance company before treatment; and

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(3)
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Reduce
administrative burdens, improve health care access, and ensure consistency
across payers.

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SECTION
2.
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Chapter 431, Hawaii Revised Statutes,
is amended by adding three new sections to part I of article 10A to be
appropriately designated and to read as follows:

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�431:10A-A
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Prior authorization; exemptions.

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(a)
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No insurer shall deny payment on the
basis that the insured or any representative of the insured failed to obtain
prior authorization for any service, medication, or procedure to treat a condition
that the prior authorization committee has determined under section 431:10A-B
does not require prior authorization for coverage of treatment.

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(b)
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For purposes of this section:

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"Insurer"
shall have the same meaning as in section 431:10A-C.

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"Prior
authorization" shall have the same meaning as in section 431:10A-C.

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�431:10A-B
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Prior authorization committee.
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(a)
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There is established within the insurance
division the prior authorization committee.
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The committee shall consist of seven voting members as follows:

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(1)
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The commissioner or the
commissioner's designee, who shall serve as the chairperson of the committee;
and

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(2)
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Six members appointed by the
governor under section 26-34; provided that:

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(A)
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Two members shall be appointed to
represent insurers;

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(B)
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Two members shall be appointed to
represent insureds; and

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(C)
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Two members shall be appointed to
represent health care providers.

The
director of health or the director of health's designee shall serve as an ex
officio, nonvoting member.

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(b)
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The members of the committee shall serve without pay but shall be
entitled to reimbursement for necessary expenses while attending meetings and
while in discharge of their duties.

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(c)
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No later than October 1 of each year, the
committee shall publish a report on the website of the department of commerce
and consumer affairs and submit the same report to the legislature.
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The report shall contain:

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(1)
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The list of conditions for which
prior authorization under section 431:10A-A is not required for coverage of
treatment; and

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(2)
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Recommendations to the legislature
regarding amendments to section 431:10A-A or 431:10A-C, if any.

Unless
specified by the committee in the report, the list of conditions for which
prior authorization under section 431:10A-A is not required for coverage of
treatment shall become effective on January 1 of the following calendar year
and shall remain effective until superseded by a subsequent report by the
committee; provided that any condition on a superseded list shall remain
effective for an insured who commences treatment of that condition before the
list is superseded.

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�431:10A-C
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Prior authorization; insurer process.
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(a)
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Insurers shall align their prior authorization processes with medicare
policies for similar services, including requirements that:

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(1)
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Urgent requests be decided within
twenty-four hours of receipt; and

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(2)
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Non-urgent requests be decided
within seven calendar days of receipt.

If an
insurer fails to respond to a prior authorization request within the required
timeframe, the request shall be deemed approved.

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(b)
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Documentation required by insurers shall be
equivalent or less burdensome than documentation required by medicare for comparable
services.

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(c)
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Insurers shall base decisions on nationally
recognized evidence-based medical guidelines and medicare's standards of
medical necessity.

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(d)
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Prior authorizations shall remain valid for
the duration of the treatment course or ninety days, whichever is longer.

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(e)
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Insurers shall not retroactively deny payment
for any service, medication, or procedure that received prior authorization
except in cases of:

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(1)
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Fraud;

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(2)
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Intentional misrepresentation; or

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(3)
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Non-compliance with the terms of the
policy explicitly stated at the time of prior authorization.

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(f)
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The commissioner shall:

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(1)
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Conduct annual audits of insurers'
prior authorization policies; and

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(2)
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Investigate patient or provider
complaints regarding noncompliance with this section.

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(g)
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Insurers shall submit quarterly reports to
the commissioner detailing the volume of prior authorization requests, approval
and denial rates, and average response times.
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The commissioner shall make the reports available to the public on the
department's website.

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(h)
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Insurers violating this section shall be subject
to:

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(1)
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Suspension or revocation of state
licensure for repeated or egregious non-compliance;

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(2)
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Public disclosure of violations and
penalties; and

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(3)
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Implementation of corrective action
plans to prevent future violations.

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(i)
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Providers and patients may appeal denials
directly to the commissioner, who shall issue a binding decision within thirty
days of receiving the appeal.

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(j)
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This section shall not apply to:

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(1)
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Health plans regulated by federal
law under the Employee Retirement Income Security Act; or

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(2)
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Medicare Advantage plans or other
federally administered programs.

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(k)
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For purposes of this section:

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"Insurer"
means any entity offering health insurance plans subject to regulation under
state law including:

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(1)
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Health maintenance organizations;

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(2)
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Preferred provider organizations;

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(3)
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Exclusive provider organizations;
and

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(4)
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Indemnity insurers.

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"Medicare"
means the federal health insurance program under Title XVIII of the Social
Security Act.

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"Prior
authorization" means a process used by insurers to determine coverage of a
service, treatment, or medication before the service, treatment, or medication
is provided to the patient.
"

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SECTION 3.
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In codifying the new sections added by section 2 of this Act, the
revisor of statutes shall substitute appropriate section numbers for the
letters used in designating the new sections in this Act.

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SECTION 4.
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New statutory material is underscored.

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SECTION
5.
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This Act shall take effect upon its
approval.

INTRODUCED BY:

_____________________________

Report Title:

Health
Insurance; Medical Insurance; Prior Authorization; Medicare

Description:

Establishes the Prior Authorization Committee to specify
medical conditions for which prior authorization by the insurer for treatment
is not required for health insurance coverage.
�

Requires health plan insurers to align their prior authorization
processes for other conditions with Medicare policies.

The summary description
of legislation appearing on this page is for informational purposes only and is
not legislation or evidence of legislative intent.