Tired of Needing Prior Authorization for Your Prescription? State Legislatures Are Too!

We often think of medical care as between a patient and a doctor. Insurance becomes involved to determine the pricing of that care and whether a procedure or drug is covered. But even when insurance companies cover a drug, that coverage may be conditional on the patient trying another drug first. Insurance companies implement prior authorization — the requirement of insurance approval for specific medical interventions prior to their administration or prescription — to  contain costs and push patients onto cheaper drugs, but state legislatures around the country have passed laws to curtail “health insurance companies second guessing doctors” with varied reforms.

Prior authorization, “the practice of requiring that a medication receive special approval by an insurance company before it can be dispensed by a pharmacy,” is a common additional step for patients seeking higher cost prescriptions and other medical interventions. For the patient’s insurance to cover the drug or procedure, a doctor must submit a request to the insurance company for coverage with relevant information about the patient and any previous interventions for the condition.

If insurance does not grant prior authorization, the patient can either choose not to fill the prescription or to pay the full cost to fill the prescription themself. Common prior authorization practices include only covering a cheaper alternate medication, even if the provider decided the most expensive prescription was a better fit. By forcing patients to “try and fail” the cheaper medication before covering the expensive alternative, insurance companies contain costs. This specific prior authorization technique is known as “step therapy.”

What are the Pros of Prior Authorization?

Insurance companies cite prior authorization’s cost-saving impact through its ability to push patients onto cheaper, medically appropriate alternatives as the main benefit. For patients who try the cheaper drug and realize that it is ineffective in their case, they can then proceed to try the more expensive, originally prescribed drug. 

Proponents say many patients and doctors seek out more costly or unnecessary interventions, either because of medical advertising, doctor’s unawareness of price differences between interventions, or fear of side effects unlikely to manifest in most patients. Further, prior authorization’s supporters state that prior authorization ensures that interventions are “medically necessary” and “clinically appropriate.”

While proponents acknowledge that the practice will increase some administrative costs, such costs are offset by the overall savings through avoidance of medically unnecessary care and unnecessarily expensive interventions. 

What are the Cons of Prior Authorization?

Opponents of prior authorization say that the process results in patients not seeking care, rather than just seeking more cost-efficient alternatives. Prior authorization generally “reduces a drug’s utilization by 27 percent.” Opponents note that doctors and patients, and not their insurance company, should be dictating which prescriptions in a given class are best for a patient. By forcing patients onto another medication first before offering coverage for the prescribed medication, insurance companies are “playing doctor.” And with prior authorization sometimes taking up to 30 days, patients experience delays in care. Doctors claim that they evaluate side effect risks, the patient’s individual health, the mode of administration, and the potential costs when deciding which regimen of relatively interchangeable drugs to prescribe. 

Take for example, pre-exposure prophylaxis (PrEP) drugs, which can be taken in oral or injectable form to prevent HIV transmission. The injectable PrEP medications are more expensive than generic Truvada, an oral PrEP medication. Some patients may be unable to adhere to the daily pill regimen due to its daily nature, but may be able to get an injection every six months with its less frequent adherence requirement. Thus, a prior authorization requirement that forces such a patient onto the harder-to-maintain oral PrEP medication because of cost would impact a patient’s ability to be protected from HIV transmission. For this patient, prior authorization that requires demonstration of trying oral PrEP, which the doctor and patient have decided would not work for the patient, could be the difference between the patient being protected from HIV or not. Even in a case where the provider is able to secure authorization for injectable PrEP, that process may take up to a month, leaving the patient unprotected from transmission for that period. Many patients may not seek out additional care after “trying and failing” the cheaper drug, and may ultimately forgo medical care entirely. In interviews with several PrEP providers in California, one study found that every provider agreed that prior authorization “delays access to PrEP … and reduces patient adherence to PrEP.”

Doctors also state that while prior authorization may save costs for insurance, it greatly increases their offices’ costs and distracts them and their staff from actual care, as doctors’ and their staff spend on average 12 hours a week dealing with prior authorizations. The American Medical Association found in 2024 that “93 percent of physicians cited care delays linked to prior authorization[,] 82 percent reported the tactic sometimes causes patients to abandon recommended treatment[, and] 29 percent witnessed prior authorization leading to a serious adverse event for a patient, including hospitalization, disability or death.”

What Are State Legislatures Doing? 

Legislatures across the country have moved to curtail prior authorization for specific drugs and procedures, and even more broadly for entire classes of medical care to increase patient access and enable doctors to dictate patient care to a greater degree. From 2015 to 2023, 20 additional states banned prior authorization for opioid use disorder treatments. New Mexico last year banned prior authorization for drugs for rare diseases. Rhode Island in 2024 passed a law that bans prior authorization for HIV-prevention medications. Illinois in 2024 passed a ban on prior authorization for inpatient mental health care, which the state extended to include outpatient services in 2025.

Other states, while not banning the practice, have begun regulating its procedures. Iowa passed a law mandating responses within 48 hours for urgent requests and 10 days for most nonurgent requests. Maryland, concerned with unintended coverage denials, restricted the use of artificial intelligence in prior authorization, echoing a similar law passed in California in 2024. And Montana now requires a patient’s new insurer to honor their previous insurer’s prior authorizations for at least three months.

Prior authorization will likely remain in policymakers’ crosshairs in the coming years, as insurance companies, doctors, and patients debate its role in access to care and cost management.