HF2555

Purpose of the Bill

The bill seeks to establish a pilot program to evaluate a new way of approving healthcare services for state employees in Minnesota. The aim is to compare the effectiveness, cost, and benefits of two different healthcare service approval methods: retrospective utilization review and prior authorization.

Main Provisions of the Bill

• Pilot Program Establishment: A pilot program will be run from January 1, 2026, to December 31, 2030. During this period, health plans will use retrospective utilization review to assess the necessity and appropriateness of healthcare services for state employees. They may also use prior authorization but are not required to do so.

• Quality and Payment Audits: Health carriers are required to conduct audits to compare these two review methods in terms of their impact on access to medically necessary care and on payments to healthcare providers.

• Payment Provisions: If a decision is made that a healthcare service was not necessary (adverse determination), health carriers do not have to pay for those services. Healthcare providers cannot charge the enrollee for services not covered due to an adverse determination.

• Program Termination Criteria: The program can be terminated if it negatively affects access to necessary healthcare or increases costs for enrollees or the state. Notice of intent to terminate must be given by July 1 of the prior year.

Significant Changes to Existing Law

• The pilot program introduces retrospective utilization review as a new method for evaluating healthcare services, which is not currently standard in state employee health plans.
• The bill specifies conditions and procedures under which healthcare services can be denied payment, potentially changing how disputes over medical necessity are resolved.

Relevant Terms

• State Employee Group Insurance Program
• Utilization Review
• Retrospective Utilization Review
• Prior Authorization
• Medically Necessary Care
• Health Carrier
• Adverse Determination
• Quality and Payment Audits
• Healthcare Costs and Access