Over the next several months, a new law (SB 866) will take effect that streamlines and standardizes the prior authorization process for prescription drugs. The new law requires all insurers, health plans (and their contracting medical groups/IPAs) and providers to use a standardized two-page form for prior authorizations of prescription medications.

Additionally, if a health plan or insurer fails to use or accept the prior authorization form, or fails to make a determination within two business days, the prior authorization request is deemed approved. Currently, plans have five business days in which to make a determination, while practices are often forced to sort through hundreds of different prior authorization forms to locate the one needed.

The new law does not expand the list of medications that require a prior authorization, but for those medications where a prior authorization is required, prescribing physicians must submit (and plans and insurers must accept) the new standardized two-page form. Please note the two-page form only applies to medication prior authorization requests; it does not apply to requests for authorization of procedures.

The Department of Managed Health Care (DMHC) and the Department of Insurance (DOI) jointly developed the standardized authorization form and implementing regulations with stakeholder input. The two agencies, however, will be enforcing the regulations on different timetables.

The regulation for DMHC-regulated products, which includes all HMOs, their contracting medical groups/IPAs, and most Blue Cross and Blue Shield PPOs, becomes effective January 1, 2015. However, the regulation for DOI-regulated products, including all other PPOs and the Blue Cross and Blue Shield Life & Health products, becomes effective on October 1, 2014.

The form (No. 61-211) will be available on the plan and insurer websites as well as the regulators’ websites soon, and can be submitted via paper, electronic transmission, telephone, web portal or another mutually agreeable method.

Anthem recently notified practices that it is streamlining the process by requiring use of the form for all product types on October 1. The California Medical Association (CMA) has asked Blue Shield for details about how it plans to implement and is waiting to hear back.

CMA is in the process of developing a physician resource sheet on the new law and will publish when it’s completed.