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Request a DemoBill limiting prior authorization dies amid concerns about rising Medicaid costs
![](https://stateaffairs.com/wp-content/uploads/2023/12/Mishler-Dec.-19-2023-scaled.webp)
Sen. Ryan Mishler, R-Mishawaka, speaks during a Dec. 19, 2023 State Budget Committee meeting. (Credit: Jarred Meeks)
A bill significantly restricting the use of prior authorization won’t be advancing this legislative session, amid concerns that it could impact the already ballooning costs to administer Medicaid in the state.
Under Senate Bill 3, insurance providers would have been prohibited from requiring insurance approval for emergency services — such as when someone needs their appendix removed — routine care and prescription drugs.
It would also prohibit insurance companies from requiring prior authorization on more than 1% of services and give health care providers a yearlong break from prior authorization requirements if their prior authorization approval rating the previous year was above 80%.
The bill never made it to a floor vote, failing to advance out of the Senate Appropriations Committee. The bill’s demise this early in the legislative session is unusual because Senate Republicans had labeled it as one of their top priorities.
Sen. Ryan Mishler, chair of the Senate Appropriations Committee, said he didn’t give Senate Bill 3 a hearing before the deadline to do so because he had questions about its potential financial impact to the state.
Opponents of the bill warned that decreasing prior authorization could lead to unnecessary medical procedures, increasing over all health care costs. A legislative fiscal analysis of the bill noted that the state could have to pay more money if a decrease in prior authorization leads to state employees or Medicaid users utilizing more medical care.
Republican lawmakers have been leery of any legislation that could increase the Medicaid costs to the state this legislative session. Because of a forecasting error, the state will have to spend almost $1 billion more than expected to cover Hoosiers’ Medicaid expenses over the biennium, state officials announced in January.
Lawmakers also typically don’t prefer to pass bills that could fiscally impact the state during a non-budget writing legislative session.
“We’re being very cautious with our Medicaid issue right now,” Mishler told State Affairs. “If there were any questions about any costs in that bill, we need to be very sure before we move it. So I think the responsible thing to do was to just pull it until we get those questions answered.”
Similar bill language to Senate Bill 3 could pop up elsewhere before the end of the legislative session, but it’s unlikely given the concerns Mishler has. He said lawmakers will continue to “keep digging into” the issue, but that could just mean it’ll be studied during an interim study committee over the summer.
Contact Kaitlin Lange on X @kaitlin_lange or email her at [email protected].
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