HB 7040, An Act Requiring A Study of Health Carrier Coverage Guidelines, Utilization Review And Coverage For Life-Saving Medical Treatment Or Services

TESTIMONY OF THE CONNECTICUT HOSPITAL ASSOCIATION
SUBMITTED TO THE INSURANCE AND REAL ESTATE COMMITTEE

Thursday, February 27, 2025

The Connecticut Hospital Association (CHA) appreciates this opportunity to submit testimony concerning HB 7040, An Act Requiring a Study of Health Carrier Coverage Guidelines, Utilization Review and Coverage for Life-Saving Medical Services. CHA supports the bill’s attention to areas of critical importance but believes there is enough available information to support action rather than additional study.

Connecticut hospitals and health systems care for patients, strengthen the state’s economy, and support vulnerable communities across the state. Every day, they work to improve healthcare access, affordability, and health equity. Even as they face ongoing challenges, hospitals provide world-class care to everyone who walks through their doors, regardless of their ability to pay. Hospitals also support an exemplary workforce as the largest collective employer in the state, contribute significantly to the state’s economy, and invest in their communities addressing social drivers of health.

HB 7040 directs the Insurance Commissioner to conduct a study of health carrier guidelines in Connecticut and compare these guidelines to those of other states. It also calls for an examination of transparency measures related to utilization review by health carriers, as well as the feasibility of revising time limits for health carriers conducting utilization reviews of nonurgent and urgent care requests. Additionally, the bill calls for a study on mandated health insurance coverage for lifesaving medical treatment or services.

While CHA appreciates the legislature’s attention to these important issues, we urge the legislature to focus on implementing tangible solutions that address the serious problems already documented by the federal government.

Burdensome insurance practices, such as prior authorization, remain significant barriers to timely healthcare delivery. These practices add unnecessary costs and delays in patient care. Last legislative session, CHA provided testimony to the Insurance and Real Estate Committee regarding payer behaviors that jeopardize timely care and appropriate payment. These include excessive prior authorization requirements, delays, inefficiencies, and downcoding, which continue to pose challenges to patients and healthcare providers.

On the federal level, there have been numerous studies documenting inappropriate and excessive healthcare insurance company practices related to prior authorization. These include an Office of the Inspector General (OIG) report¹ released in 2022 and a U.S. Senate Permanent Subcommittee on Investigations report² released in 2024. In response, the Centers for Medicare & Medicaid Services (CMS) issued new strict requirements that apply to Medicare Advantage, Medicaid Managed Care plans, and Medicaid Fee for Service state administrators; Children’s Health Insurance Program (CHIP) plans; and Qualified Health Plans (QHPs) on the Affordable Care Act Marketplace. States are following suit, pursuing legislation to regulate such practices on the commercial fully-insured market, the adverse effects of which have also been well documented.³

Connecticut has also begun to address these issues. For example, PA 23-171 tasked the Insurance Department, in consultation with the Office of Health Strategy, to report to the Public Health Committee by January 1, 2025 on the utilization management and provider payment practices of Medicare Advantage plans. The report, which has not been completed, is intended to examine, among other things, the impact of such practices on hospital placement, discharges, transfers, and costs to both hospitals and plan members. This legislation also requires recommendations on improving timely care delivery, reducing administrative burdens for providers, and addressing the impact of plan practices on consumers and plan sponsors. These are key issues that align with the concerns raised in HB 7040 and further highlight the need for actionable solutions rather than additional studies.

We urge the Committee to prioritize reducing unnecessary administrative burdens, improving oversight of health insurers, and ensuring timely payment for services. Addressing these challenges today will have a direct, positive impact on the quality and efficiency of healthcare delivery in Connecticut.
Thank you for your consideration of our position. For additional information, contact CHA Government Relations at (203) 294-7301.

¹ https://oig.hhs.gov/reports/all/2022/some-medicare-advantage-organization-denials-of-prior-authorization-requests-raise-concerns-about-beneficiary-access-to-medically-necessary-care/
² https://oig.hhs.gov/reports/all/2022/some-medicare-advantage-organization-denials-of-prior-authorization-requests-raise-concerns-about-beneficiary-access-to-medically-necessary-care/
³ https://www.aha.org/system/files/media/file/2022/10/Addressing-Commercial-Health-Plan-Challenges-to-Ensure-Fair-Coverage-for-Patients-and-Providers.pdf