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A 5571

Relates to family leave

2025 Regular Session Introduced by Kwani O'Pharrow

Bans pre-approval or precertification by carriers, TPAs, PBMs, SHBP, and SEHBP for covered, provider-prescribed tests, procedures, or drugs to speed access to care.

REFERRED TO LABOR
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Bill Summary · A 5571

New Jersey Assembly Bill A-5571: Summary

Note: The bill’s title listed as “Relates to family leave” appears to be inconsistent with the bill’s substantive provisions, which focus on pre-approval/precertification of health benefits. This summary reflects the introduced text’s content.

Purpose and intent

  • Prohibits health benefits payors from requiring prior authorization (pre-approval or precertification) for medical tests, procedures, or prescription drugs that are already covered under a health benefits plan and prescribed by a licensed health care provider.
  • Applies to carriers, third-party administrators, pharmacy benefits managers, and specific state employee health programs.
  • Aims to reduce administrative barriers and speed access to medically necessary care by removing utilization management steps that delay treatment.

Key provisions

1) Carriers
- No conditioning of payment for a medical test, procedure, or prescription drug on pre-approval or precertification if the item is covered and prescribed by a licensed provider.

2) Third-party administrators
- Same prohibition as above for tests, procedures, or drugs covered under the health benefits plan and prescribed by a licensed provider.

3) Pharmacy benefits managers (PBMs)
- No conditioning of payment for a prescription drug on pre-approval or precertification if the drug is covered and prescribed.

4) State Health Benefits Program (SHBP) contracts
- SHBP contracts for health or prescription drug benefits cannot require pre-approval/precertification for covered items prescribed by a licensed provider.

5) School Employees’ Health Benefits Program (SEHBP) contracts
- SEHBP contracts cannot require pre-approval/precertification for covered tests, procedures, or drugs prescribed by a licensed provider.

6) Effective date
- The act takes effect immediately and applies to health benefits plans or prescription drug plans issued or purchased on or after that date.

Affected parties

  • Health insurers and carriers
  • Third-party administrators
  • Pharmacy benefits managers
  • State Health Benefits Program (SHBP)
  • School Employees’ Health Benefits Program (SEHBP)
  • Health benefits and prescription drug plans issued or purchased after the effective date

Timeline and status

  • Introduced: April 10, 2025
  • Referred to Assembly Labor/Operations: February 14, 2025 (appears as a duplicate entry in actions)
  • Latest committee action: Referred to Assembly Financial Institutions and Insurance Committee (April 10, 2025)
  • Sponsors: Kwani O’Pharrow (primary)

Related bills: A 6744 (prior-session); S 2257 (companion)

Potential impact and considerations

  • Expected benefits: Faster access to care, reduced administrative delays, and less patient/physician burden from utilization management requirements.
  • Potential drawbacks: Reduced leverage for payors to manage costs and appropriate use of high-cost tests or drugs; potential for increased utilization without pre-authorization checks (though still contingent on plan coverage and medical necessity as determined by a licensed provider).
  • Fiscal/administrative impact: Minor to moderate shifts in how plans process payments; may require operational adjustments to ensure consistency with the prohibition across carriers, TPAs, PBMs, and state programs.

Summary

A-5571 would bar pre-approval or precertification requirements by carriers, TPAs, PBMs, SHBP, and SEHBP for any medically necessary tests, procedures, or prescribed drugs that are covered and prescribed by licensed providers. Effective immediately for plans issued or purchased after the date of enactment, the bill seeks to streamline access to care and reduce insurer-driven delays.

Compiled from official sources — confirm details with the bill’s official record.

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