S.F. 2421 DIVISION I 1 PRIOR AUTHORIZATION —— USE OF ARTIFICIAL INTELLIGENCE AND PEER 2 REVIEW 3 Section 1. Section 514F.8, subsection 1, Code 2026, is 4 amended by adding the following new paragraph: 5 NEW PARAGRAPH . 0b. “Downgrade” means a decision by a 6 health carrier or utilization review organization to change 7 an expedited or urgent request for prior authorization 8 to a standard determination, or otherwise modify a health 9 care service that is the subject of a request for prior 10 authorization to a lower-level health care service. 11 Sec. 2. Section 514F.8, Code 2026, is amended by adding the 12 following new subsection: 13 NEW SUBSECTION . 2A. A utilization review organization may 14 use an artificial intelligence-based algorithm to provide an 15 initial review of a request for prior authorization, except 16 that, for a prior authorization request for a health care 17 service based on medical necessity, a utilization review 18 organization shall not use an artificial intelligence-based 19 algorithm as the sole basis for the utilization review 20 organization’s decision to deny, delay, or downgrade the prior 21 authorization request. 22 Sec. 3. NEW SECTION . 514F.8A Prior authorizations —— peer 23 review. 24 1. For purposes of this section: 25 a. “Clinical peer” means a health care professional that 26 meets all of the following requirements: 27 (1) The health care professional practices in the same or 28 similar specialty as the health care provider that requested 29 a prior authorization. 30 (2) The health care professional has experience managing 31 the specific medical condition or administering the health care 32 service that is the subject of the prior authorization request. 33 (3) The health care professional is employed by or 34 contracted with the utilization review organization or health 35 -1- LSB 6750SV (4) 91 nls/ko 1/ 13

S.F. 2421 carrier to which a health care provider submitted a request for 1 prior authorization. 2 b. “Covered person” means the same as defined in section 3 514F.8. 4 c. “Downgrade” means a decision by a health carrier 5 or utilization review organization to change an expedited 6 or urgent request for prior authorization to a standard 7 determination, or otherwise modify a health care service that 8 is the subject of a request for prior authorization to a 9 lower-level health care service. 10 d. “Health care professional” means the same as defined in 11 section 514J.102. 12 e. “Health care provider” means the same as defined in 13 section 514F.8. 14 f. “Health care services” means the same as defined in 15 section 514F.8. 16 g. “Health carrier” means the same as defined in section 17 514F.8. 18 h. “Physician” means a licensed doctor of medicine and 19 surgery or a licensed doctor of osteopathic medicine and 20 surgery licensed under chapter 148. 21 i. “Prior authorization” means the same as defined in 22 section 514F.8. 23 j. “Qualified reviewer” means a physician that meets all of 24 the following requirements: 25 (1) The physician practices in the same or a similar 26 specialty as the health care provider that requested a prior 27 authorization. 28 (2) The physician has the training and expertise to treat 29 the specific medical condition that is the subject of a 30 request for prior authorization, including sufficient knowledge 31 to determine whether the health care service that is the 32 subject of the request is medically necessary or clinically 33 appropriate. 34 (3) The physician is employed by or contracted with 35 -2- LSB 6750SV (4) 91 nls/ko 2/ 13

S.F. 2421 the utilization review organization or health carrier to 1 which a health care provider submitted a request for prior 2 authorization. 3 k. “Utilization review organization” means the same as 4 defined in section 514F.8. 5 2. A utilization review organization shall not deny or 6 downgrade a request for prior authorization unless all of the 7 following requirements are met: 8 a. The decision to deny or downgrade the request is made by 9 either of the following: 10 (1) A qualified reviewer, if the health care provider 11 requesting prior authorization is a physician. 12 (2) A clinical peer, if the health care provider requesting 13 prior authorization is not a physician. 14 b. The utilization review organization provides the health 15 care provider that requested the prior authorization all of the 16 following: 17 (1) A written statement that cites the specific reasons 18 for the denial or downgrade, including any coverage criteria 19 or limits, or clinical criteria, that the utilization review 20 organization considered or that was the basis for the denial 21 or downgrade. The written statement shall be signed by either 22 of the following: 23 (a) The qualified reviewer that made the denial or downgrade 24 determination, if the health care provider that requested prior 25 authorization is a physician. 26 (b) The clinical peer that made the denial or downgrade 27 determination, if the health care provider that requested prior 28 authorization is not a physician. 29 (2) A written explanation of the utilization review 30 organization’s appeals process. The utilization review 31 organization shall also provide the written explanation to the 32 covered person for whom prior authorization was requested. 33 (3) A written attestation that is either of the following: 34 (a) If the health care provider that requested prior 35 -3- LSB 6750SV (4) 91 nls/ko 3/ 13

S.F. 2421 authorization is a physician, a written attestation that 1 the qualified reviewer who made the denial or downgrade 2 determination practices in the same or a similar specialty as 3 the health care provider, and has the requisite training and 4 expertise to treat the medical condition that is the subject 5 of the request for prior authorization, including sufficient 6 knowledge to determine whether the health care service is 7 medically necessary or clinically appropriate. The attestation 8 shall include the qualified reviewer’s name, national provider 9 identifier, board certifications, specialty expertise, and 10 educational background. 11 (b) If the health care provider that requested prior 12 authorization is not a physician, a written attestation 13 that the clinical peer who made the denial or downgrade 14 determination practices in the same or a similar specialty as 15 the health care provider, and the clinical peer has experience 16 managing the specific medical condition or administering 17 the health care service that is the subject of the request 18 for prior authorization. The attestation shall include 19 the clinical peer’s name, national provider identifier, 20 board certifications, specialty expertise, and educational 21 background. 22 3. A utilization review organization that denies a request 23 for prior authorization shall, no later than seven business 24 days after the date that the utilization review organization 25 notifies the requesting health care provider of the denial, 26 conduct a consultation either in person or remotely, as 27 follows: 28 a. Between the health care provider and a qualified 29 reviewer, if the health care provider requesting prior 30 authorization is a physician. 31 b. Between the health care provider and a clinical peer, if 32 the health care provider requesting prior authorization is not 33 a physician. 34 4. a. If a utilization review organization’s decision to 35 -4- LSB 6750SV (4) 91 nls/ko 4/ 13

S.F. 2421 deny or downgrade a request for prior authorization is appealed 1 by the requesting health care provider or covered person, the 2 appeal shall be conducted by either of the following: 3 (1) A qualified reviewer, if the health care provider 4 requesting prior authorization is a physician. 5 (2) A clinical peer, if the health care provider requesting 6 prior authorization is not a physician. 7 b. A qualified reviewer or clinical peer involved in the 8 initial denial or downgrade determination of a request for 9 prior authorization that is the subject of an appeal shall not 10 conduct the appeal. 11 c. When conducting an appeal of a request for prior 12 authorization, the qualified reviewer or clinical peer shall 13 consider the known clinical aspects of the health care services 14 under review, including but not limited to medical records 15 relevant to the covered person’s medical condition that 16 is the subject of the health care services for which prior 17 authorization is requested, and any relevant medical literature 18 submitted by the health care provider as part of the appeal. 19 5. The commissioner of insurance may adopt rules pursuant to 20 chapter 17A to administer this section. 21 Sec. 4. APPLICABILITY. This division of this Act applies 22 to all of the following: 23 1. Requests for prior authorization made before January 24 1, 2027, if the request has not been finally determined on or 25 before that date. 26 2. Requests for prior authorization made on or after January 27 1, 2027. 28 DIVISION II 29 PRIOR AUTHORIZATION —— CANCER-RELATED EXEMPTIONS 30 Sec. 5. NEW SECTION . 514F.8B Prior authorizations —— 31 exemptions for cancer-related screenings. 32 1. For purposes of this section: 33 a. “Covered person” means the same as defined in section 34 514F.8. 35 -5- LSB 6750SV (4) 91 nls/ko 5/ 13

S.F. 2421 b. “Health benefit plan” means the same as defined in 1 section 514J.102. 2 c. “Health care professional” means the same as defined in 3 section 514J.102. 4 d. “Health carrier” means an entity subject to the 5 insurance laws and regulations of this state, or subject 6 to the jurisdiction of the commissioner, including an 7 insurance company offering sickness and accident plans, a 8 health maintenance organization, a nonprofit health service 9 corporation, a plan established pursuant to chapter 509A 10 for public employees, or any other entity providing a plan 11 of health insurance, health care benefits, or health care 12 services. “Health carrier” includes the following: 13 (1) The medical assistance program under chapter 249A and 14 the healthy and well kids in Iowa (Hawki) program under chapter 15 514I. 16 (2) A managed care organization acting pursuant to a 17 contract with the department of health and human services to 18 administer the medical assistance program under chapter 249A, 19 or the healthy and well kids in Iowa (Hawki) program under 20 chapter 514I. 21 e. “Prior authorization” means the same as defined in 22 section 514F.8. 23 f. “Utilization review” means the same as defined in section 24 514F.4, subsection 3. 25 2. A health carrier shall not require prior authorization 26 for, or impose additional utilization review requirements on, a 27 covered person for a cancer-related screening if the screening 28 is recommended by the covered person’s health care professional 29 based on the most recently updated national comprehensive 30 cancer network clinical practice guidelines in oncology. 31 3. The director of health and human services shall adopt 32 rules pursuant to chapter 17A to administer this section, 33 including but not limited to rules relating to all of the 34 following: 35 -6- LSB 6750SV (4) 91 nls/ko 6/ 13

S.F. 2421 a. The medical assistance program under chapter 249A and 1 the healthy and well kids in Iowa (Hawki) program under chapter 2 514I. 3 b. A managed care organization acting pursuant to a contract 4 with the department of health and human services to administer 5 the medical assistance program under chapter 249A, or the 6 healthy and well kids in Iowa (Hawki) program under chapter 7 514I. 8 4. The commissioner of insurance may adopt rules pursuant 9 to chapter 17A to administer this section, except as otherwise 10 provided in subsection 3. 11 Sec. 6. APPLICABILITY. This division of this Act applies 12 to all of the following: 13 1. Health benefit plans delivered, issued for delivery, 14 continued, or renewed in this state on or after January 1, 15 2027. 16 2. Requests for prior authorization for a cancer-related 17 screening if the screening is recommended by the covered 18 person’s health care professional based on the most recently 19 updated national comprehensive cancer network clinical practice 20 guidelines in oncology, the request is made before January 1, 21 2027, and the request has not been finally determined on or 22 before that date. 23 3. Requests for prior authorization for a cancer-related 24 screening, if the screening is recommended by the covered 25 person’s health care professional based on the most recently 26 updated national comprehensive cancer network clinical practice 27 guidelines in oncology, made on or after January 1, 2027. 28 DIVISION III 29 PRIOR AUTHORIZATION —— LIFE-THREATENING HEALTH CONDITIONS 30 Sec. 7. NEW SECTION . 514F.8C Prior authorizations —— 31 exemptions for life-threatening health conditions. 32 1. For purposes of this section: 33 a. “Covered person” means the same as defined in section 34 514F.8. 35 -7- LSB 6750SV (4) 91 nls/ko 7/ 13

S.F. 2421 b. “Health benefit plan” means the same as defined in 1 section 514J.102. 2 c. “Health care professional” means the same as defined in 3 section 514J.102. 4 d. “Health carrier” means the same as defined in section 5 514F.8. 6 e. “Prior authorization” means the same as defined in 7 section 514F.8. 8 f. “Utilization review” means the same as defined in section 9 514F.4, subsection 3. 10 2. A health carrier shall not require prior authorization 11 for, or impose additional utilization review requirements 12 on, a covered person for diagnosis and treatment of a health 13 condition that develops or becomes evident in a covered person 14 while the covered person is receiving treatment at an inpatient 15 facility, and the health condition is reasonably determined by 16 a health care professional to be a life-threatening condition 17 unless the covered person receives immediate assessment and 18 treatment. 19 3. The commissioner of insurance may adopt rules pursuant to 20 chapter 17A to administer this section. 21 Sec. 8. APPLICABILITY. This division of this Act applies 22 to all of the following: 23 1. Health benefit plans delivered, issued for delivery, 24 continued, or renewed in this state on or after January 1, 25 2027. 26 2. Requests for prior authorization for diagnosis and 27 treatment of a health condition that develops or becomes 28 evident in a covered person while the covered person 29 is receiving treatment at an inpatient facility if the 30 health condition is reasonably determined by a health care 31 professional to be a life-threatening condition unless the 32 covered person receives immediate assessment and treatment, the 33 request is made before January 1, 2027, and the request has not 34 been finally determined on or before that date. 35 -8- LSB 6750SV (4) 91 nls/ko 8/ 13

S.F. 2421 DIVISION IV 1 UTILIZATION REVIEW ORGANIZATIONS —— PREPAYMENT AUDITS 2 Sec. 9. NEW SECTION . 514F.10 Utilization review 3 organizations —— prepayment audits. 4 1. For purposes of this section: 5 a. “Audit” means a review, investigation, or request for 6 additional documentation by a health carrier or utilization 7 review organization on behalf of the health carrier prior to or 8 after issuing payment on a claim to a health care provider. 9 b. “Health care provider” means the same as defined in 10 section 514F.8. 11 c. “Health carrier” means the same as defined in section 12 514F.8. 13 d. “Utilization review organization” means the same as 14 defined in section 514F.8. 15 2. A health carrier or utilization review organization that 16 conducts an audit shall notify the health care provider that 17 submitted the claim of the initiation of the audit no later 18 than fifteen calendar days after the date the health carrier 19 selects the claim for audit. 20 3. A health carrier or utilization review organization 21 shall complete an audit of a claim and issue a determination 22 on the claim to the health care provider that submitted 23 the claim no later than forty-five calendar days after the 24 date that the utilization review organization receives all 25 requested documentation regarding the claim from the health 26 care provider. 27 4. A health care provider that submitted a claim that is 28 the subject of an audit by a health carrier or utilization 29 review organization, and that receives an adverse determination 30 regarding the claim, may appeal the adverse determination no 31 later than thirty calendar days after the date the health care 32 provider receives the audit determination. 33 5. A health carrier or utilization review organization 34 shall consider an appeal under subsection 4, and issue a final 35 -9- LSB 6750SV (4) 91 nls/ko 9/ 13

S.F. 2421 determination on the claim that is the subject of the appeal, 1 no later than fourteen calendar days after that date the health 2 carrier or utilization review organization receives notice of 3 the appeal. 4 6. If a health carrier or utilization review organization 5 violates this section, the claim shall be automatically 6 approved by the health carrier or utilization review 7 organization and promptly paid pursuant to section 507B.4A, 8 subsection 2. 9 7. The commissioner of insurance may adopt rules pursuant to 10 chapter 17A to administer and enforce this section. 11 Sec. 10. APPLICABILITY. This division of this Act applies 12 to audits initiated on or after January 1, 2027. 13 EXPLANATION 14 The inclusion of this explanation does not constitute agreement with 15 the explanation’s substance by the members of the general assembly. 16 This bill relates to utilization review organizations’ use 17 of artificial intelligence, prior authorization determinations 18 and exemptions, and audits. 19 DIVISION I —— PRIOR AUTHORIZATION —— USE OF ARTIFICIAL 20 INTELLIGENCE AND PEER REVIEW. Under the bill, a 21 utilization review organization (URO) may use an artificial 22 intelligence-based algorithm to provide an initial review of 23 a request for prior authorization (authorization), except 24 that, for a request for a health care service (service) 25 based on medical necessity, a URO shall not use an artificial 26 intelligence-based algorithm as the sole basis for a decision 27 to deny, delay, or downgrade the authorization request. 28 “Downgrade” is defined in the bill. 29 A URO shall not deny or downgrade a request for authorization 30 unless the decision is made by a qualified reviewer or clinical 31 peer and the URO provides the health care provider (provider) 32 requesting authorization a written statement citing the 33 reasons for the decision, explaining the appeals process, and 34 a written attestation as described by the bill. If a request 35 -10- LSB 6750SV (4) 91 nls/ko 10/ 13

S.F. 2421 for authorization is denied, the URO shall notify the provider 1 within seven days and conduct a consultation as described by 2 the bill. “Clinical peer” and “qualified reviewer” are defined 3 in the bill. 4 If a URO’s decision to deny or downgrade a request for 5 authorization is appealed by the requesting provider or covered 6 person (person), the appeal shall be conducted by a qualified 7 reviewer or clinical peer who was not involved in the initial 8 denial or downgrade. When conducting an appeal, the qualified 9 reviewer or clinical peer shall consider the known clinical 10 aspects of the services under review. 11 The commissioner of insurance (commissioner) may adopt rules 12 to administer this division of the bill. 13 This division of the bill applies to requests for 14 authorization made before January 1, 2027, if the request 15 has not been finally determined on or before that date, and 16 requests for authorization made on or after January 1, 2027. 17 DIVISION II —— PRIOR AUTHORIZATION —— CANCER-RELATED 18 EXEMPTIONS. A health carrier (carrier) shall not require 19 authorization for, or impose additional utilization review 20 requirements on, a person for a cancer-related screening 21 (screening) if the screening is recommended by the person’s 22 health care professional (professional) based on the most 23 recently updated national comprehensive cancer network clinical 24 practice guidelines in oncology. The director of health 25 and human services shall adopt rules, and the commissioner 26 may adopt rules, to administer this division of the bill as 27 detailed in the bill. 28 This division of the bill applies to health benefit plans 29 (plans) delivered, issued for delivery, continued, or renewed 30 on or after January 1, 2027, and requests for authorization 31 for a screening recommended by a person’s professional if 32 the request is made before January 1, 2027, and has not been 33 finally determined on or before that date. The bill also 34 applies to such requests made on or after January 1, 2027. 35 -11- LSB 6750SV (4) 91 nls/ko 11/ 13

S.F. 2421 DIVISION III —— PRIOR AUTHORIZATION —— LIFE-THREATENING 1 HEALTH CONDITIONS. A carrier shall not require authorization 2 for, or impose additional utilization review requirements on, 3 a person for diagnosis and treatment of a health condition 4 (condition) that develops or becomes evident while the 5 person is receiving treatment at an inpatient facility 6 and is reasonably determined by a professional to be a 7 life-threatening condition unless the person receives immediate 8 assessment and treatment. The commissioner may adopt rules to 9 administer this division of the bill. 10 This division of the bill applies to plans delivered, 11 issued for delivery, continued, or renewed on or after January 12 1, 2027, and requests for authorization for diagnosis and 13 treatment of a condition that develops or becomes evident in a 14 person while receiving treatment at an inpatient facility if 15 the condition is life-threatening unless the person receives 16 immediate assessment and treatment, the request is made 17 before January 1, 2027, and the request has not been finally 18 determined on or before that date. 19 DIVISION IV —— UTILIZATION REVIEW ORGANIZATIONS —— AUDITS. 20 A carrier or URO that conducts an audit shall notify the 21 provider that submitted the claim of the initiation of the 22 audit no later than 15 days after the carrier selects the 23 claim for audit. “Audit” is defined in the bill. A carrier 24 or URO shall complete an audit and issue a determination 25 to the provider no later than 45 days after the carrier or 26 URO receives all documentation regarding the claim from the 27 provider. 28 A provider who submitted a claim that is the subject of an 29 audit and who receives an adverse determination regarding the 30 claim may appeal it no later than 30 days after the provider 31 receives the determination. A carrier or URO shall consider 32 an appeal and issue a final determination no later than 14 33 days after receiving notice of an appeal. If a carrier or URO 34 violates the bill, the claim shall be automatically approved by 35 -12- LSB 6750SV (4) 91 nls/ko 12/ 13