AZ Legislative Update as of Friday, February 7th, 2025
Posted by [email protected] on Feb. 10, 2025 / Subscribe 0
Friday was the 26th day of the Arizona 57th Legislature, 1st Regular Session and we are quickly approaching the deadline for bills to be heard in their chamber of origin (February 21). With only two weeks remaining before the legislative crossover, activity over the next couple of weeks will be intensifying as members attempt to keep their bills alive and moving through the process.
In a surprise move earlier this week, long-time House Republican chief of staff, Michael Hunter, announced that he will be stepping down, effective February 14th, to serve as the new chief operations officer at Christian Family Care. Hunter has been a fixture at the Capitol for decades. He has served as the House majority chief of staff since 2016. Prior to that, he worked for former Governor Jan Brewer on legislative affairs, policy and tax reform and he was a budget and finance policy advisor in the Arizona Senate.
This past Monday was the deadline for senators to introduce new bills for consideration. House members still have until Monday evening, February 10th to introduce new legislative proposals. As it currently stands, there are 1,529 bills and 108 resolutions posted.
Below, please find a few bills that we would like to highlight. Some of them are up in committee this week. Additionally, you will find attached your full tracking list of bills.
We are continuing to engage members and staff on your top legislative priorities. If you have any questions or concerns, please do not hesitate to contact us.
Health Insurance
HB 2109 Forced Organ Harvesting; Insurance Prohibition (Biasiucci): HB 2109 passed out of the House Health & Human Services Committee on Monday, 7-5. The bill proposes several amendments to the Arizona Revised Statutes, specifically targeting health insurance and disability insurance policies regarding human organ transplants. It introduces new sections that allow subscription contracts, evidence of coverage, disability insurance policies, and group or blanket disability insurance policies to limit coverage for organ transplants or post-transplant care if the transplant occurs in the People's Republic of China or Hong Kong, or if the organ was procured from these regions. Importantly, the bill clarifies that it does not require coverage for organ transplants and does not restrict insurers from denying coverage for valid reasons. Additionally, the bill includes a provision that allows the administration, with the approval of the Centers for Medicare and Medicaid Services, to limit coverage for organ transplants under certain conditions similar to those outlined for insurance policies.
HB 2130 Claims; Prior Authorization; Denials; Contact (Bliss): HB 2130 passed out of the House Health & Human Services Committee, 12-0. The bill requires a health care insurer that denies a claim or prior authorization for any reason to provide both a detailed explanation as to why a claim or prior authorization was denied and the contact information of the individual or specific department that can address questions about the claim or prior authorization denial.
HB 2175 Claims; Prior Authorization; Conduct (Willoughby): HB 2175 passed out of the House Commerce Committee on Tuesday evening, 10-0. We are currently working on additional amendment language with the Arizona Medical Association. The bill requires a health care provider to individually review each claim for health care services before a health care insurer denies a claim or a prior authorization unless the denial is due to a lack of administrative completeness, the member enrollment status is excluded from coverage under the plan, or a determination is made that a service or provider type is categorically excluded from coverage under the plan. HB 2175 prohibits the use of artificial intelligence to deny a claim or prior authorization. The bill classifies the denial of a claim or a prior authorization without an individual review of the claim as an act of unprofessional conduct. Additionally, it outlines the health care professionals that are defined as a health care provider.
HB 2693 Genetic Sequencing; Insurance; Prohibition (Biasiucci): HB 2693 passed out of the House Health & Human Services Committee on Monday, 9-3. The bill establishes insurance coverage and Arizona Health Care Cost Containment System (AHCCCS) limitations on genetic sequencing. It outlines prohibitions and requirements for health care institutions and research facilities relating to genetic sequencers and software used for genetic sequencing.
SB 1102 Pharmacy Benefits; Prescribing; Exemption (Shamp): SB 1102 will be heard in the Senate Committee of the Whole on Monday. The bill prohibits a pharmacy benefit manager from limiting or excluding coverage of a prescription drug for any covered individual who is on a specific prescription drug and outlined conditions are met. The bill prescribes formulary change notification requirements and establishes a formulary prescription drug exception process.
SB 1291 Health Insurers; Provider; Payment; Claim (Angius): SB 1291 will be heard in the Senate Health & Human Services Committee on Wednesday. The bill would amend several sections of the Arizona Revised Statutes related to provider credentialing. Key updates include the introduction of a definition for "Complete credentialing application," which specifies that it encompasses the submission of a health plan's credentialing application along with supporting documents. Additionally, the bill modifies the definitions of "Credentialing," "Designee," and "Health insurer," removing references to "its designee" in the context of credentialing and recredentialing processes. The term "Recredential" is also updated to clarify that it involves confirming a provider's good standing without requiring a new application or contracting process. Furthermore, the bill establishes new timelines for health insurers regarding the credentialing process. It mandates that insurers must conclude the credentialing and loading process within 145 calendar days of receiving a complete credentialing application. It also requires health insurers to provide written or electronic confirmation of receipt of applications within two business days and to notify applicants of any deficiencies within seven business days. Importantly, the bill stipulates that health insurers must retroactively approve a participating provider's credentialing application to the date of the complete application, ensuring that claims for covered services provided by credentialed providers are paid accordingly.
SB 1512 Utilization Review; Prior Authorization; Requirements (Payne): SB 1512 was dropped earlier this week. This problematic bill is a repeat from last year’s HB 2726. It introduces new provisions that require health care insurers, pharmacy benefit managers, and utilization review agents to honor prior authorizations for a period of ninety days when a member changes health insurance, unless the service is excluded under the new plan. Additionally, it mandates that any changes in coverage or approval criteria do not affect members who have already received prior authorization during their plan year. The bill also stipulates that prior authorizations must remain valid for at least one year for chronic or long-term care conditions and for at least six months for other services, regardless of dosage changes. Furthermore, the bill requires health care insurers and related entities to maintain transparency by posting all prior authorization requirements and changes on their publicly accessible websites, along with providing sixty days' notice to enrollees before implementing any new or amended requirements. Definitions for "chronic or long-term care condition" and "member" are also included to clarify the scope of the bill. SB 1512 has not yet been assigned to a committee.
SB 1626 Health Insurance; Surprise Billing; Disputes (Werner): SB 1626 will be heard in the Senate Health & Human Services Committee on Wednesday. The proposes amendments to section 20-3117 of the Arizona Revised Statutes, specifically addressing the timely payment of claims. The current law mandates that health insurers include a notice in each explanation of benefits related to noncontracted health care providers. The bill adds a stipulation that this requirement applies only to claims not subject to independent dispute resolution under the No Surprises Act. Additionally, the bill modifies the existing language regarding disputes over surprise out-of-network bills. It clarifies that the requirement for health care providers, their representatives, or billing companies to provide written notice of the dispute resolution process applies only to disputes that are not subject to independent dispute resolution under the No Surprises Act. This change aims to streamline the process and ensure that enrollees are informed about their rights and options in specific situations.
Insurance Operations
HB 2193 Captive Insurers; Certificate of Dormancy (Livingston): HB 2193 passed out of the House Rules Committee on Monday, 8-0 and is now awaiting floor action. The bill proposes several updates to the Arizona Revised Statutes concerning captive insurers. It introduces a new definition for "dormant captive insurer," which refers to a captive insurer that has ceased transacting insurance business and has no outstanding liabilities. The bill also establishes a process for dormant captive insurers to apply for a certificate of dormancy, which must be renewed every five years. Additionally, it sets forth requirements for maintaining capital and surplus, submitting annual financial reports, and the conditions under which a certificate of dormancy may be revoked or surrendered. Furthermore, the bill modifies existing definitions and requirements related to captive insurers, including changes to the terminology used for certain entities, such as "board of managers" instead of "board of directors" for limited liability companies. It also reduces the minimum capital requirement for protected cell captive insurers from $500,000 to $250,000 and specifies that at least one member of the board of managers for limited liability companies must be a resident of Arizona. Overall, these updates aim to streamline the regulatory framework for captive insurers and enhance compliance measures.
HB 2210 DIFI; Continuation (Livingston): HB 2210 will be heard on Tuesday in the House Commerce Committee. The bill continues the Department of Insurance and Financial Institutions for an additional 8 years.
HB 2451 Administrative Hearings; Change of Judge (Willoughby): HB 2451 passed out of the House Judiciary Committee on Wednesday, 9-0. The bill introduces a new provision that allows a party to a contested case or appealable agency action to have one change of administrative law judge as a matter of right, with subsequent changes requiring a peremptory motion for disqualification based on specific reasons, such as bias, prior engagement as counsel, familial relations, or being a material witness. Additionally, the bill clarifies that a peremptory motion to disqualify an administrative law judge counts as a peremptory strike against that judge. Furthermore, the bill modifies existing language concerning the taking of depositions and the issuance of subpoenas. It replaces the term "permit" with "allow" in the context of depositions and clarifies that subpoenas, depositions, or other discovery are only allowed as specified in the new provisions. The bill also updates the section on judicially cognizable facts, emphasizing the agency's experience and technical competence in evaluating evidence while establishing a prima facie demonstration for agency-issued licenses.
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