As used in the Prior Authorization Act:

1. A. "adjudicate" means to approve or deny a request for prior authorization;
2. B. "auto-adjudicate" means to use technology and automation to make a near-real-time determination to approve, deny or pend a request for prior authorization;
3. C. "chronic health condition" means a condition that lasts one or more years and requires ongoing medical attention or limits activities of daily living;
4. D. "chronic maintenance drug" means a medication approved by the federal food and drug administration to be taken regularly for the treatment of chronic health conditions;
5. E. "covered person" means an individual who is insured under a health benefits plan;
6. F. "emergency care" means medical care, pharmaceutical benefits or related benefits to a covered person after the sudden onset of what reasonably appears to be a medical condition that manifests itself by symptoms of sufficient severity, including severe pain, that the absence of immediate medical attention could be reasonably expected by a reasonable layperson to result in jeopardy to a person's health, serious impairment of bodily functions, serious dysfunction of a bodily organ or part or disfigurement to a person;
7. G. "health benefits plan" means a policy, contract, certificate or agreement, entered into, offered or issued by a health insurer to provide, deliver, arrange for, pay for or reimburse any of the costs of medical care, pharmaceutical benefits or related benefits;
8. H. "health care professional" means an individual who is licensed or otherwise authorized by the state to provide health care services;
9. I. "health care provider" means a health care professional, corporation, organization, facility or institution licensed or otherwise authorized by the state to provide health care services;
10. J. "health insurer" means a health maintenance organization, nonprofit health care plan, provider service network, medicaid managed care organization or third-party payer or its agent;
11. K. "medical care, pharmaceutical benefits or related benefits" means medical, behavioral, hospital, surgical, physical rehabilitation and home health services, and includes pharmaceuticals, durable medical equipment, prosthetics, orthotics and supplies;

12. L. "medical necessity" means health care services determined by a health care provider, in consultation with the health insurer, to be appropriate or necessary according to:

    1. (1) applicable, generally accepted principles and practices of good medical care;
    2. (2) practice guidelines developed by the federal government or national or professional medical societies, boards or associations; or
    3. (3) applicable clinical protocols or practice guidelines developed by the health insurer consistent with federal, national and professional practice guidelines, which shall apply to the diagnosis, direct care and treatment of a physical or behavioral health condition, illness, injury or disease;
13. M. "medical peer review" means review by a health care professional from the same or similar practice specialty that typically manages the medical condition, procedure or treatment under review for prior authorization;
14. N. "off-label" means a federal food and drug administration-approved medication that does not have a federal food and drug administration-approved indication for a specific condition or disease but is prescribed to a covered person because there is sufficient clinical evidence for a prescribing clinician to reasonably consider the medication to be medically necessary to treat the covered person's condition or disease;
15. O. "office" means the office of superintendent of insurance;
16. P. "pend" means to hold a prior authorization request for further clinical review;
17. Q. "pharmacy benefits manager" means a person licensed by the superintendent as a pharmacy benefits manager pursuant to the provisions of the Pharmacy Benefits Manager Regulation Act [Chapter 59A, Article 61 NMSA 1978] that has a direct contract with an entity subject to the Health Care Purchasing Act [Chapter 13, Article 7 NMSA 1978];
18. R. "prior authorization" means a voluntary or mandatory pre-service determination, including a recommended clinical review, that a health insurer makes regarding a covered person's eligibility for health care services, based on medical necessity, the appropriateness of the site of services and the terms of the covered person's health benefits plan;
19. S. "rare disease or condition" means a disease or condition that affects fewer than two hundred thousand people in the United States; and
20. T. "serious mental illness" means a mental condition that significantly impairs daily functioning and requires comprehensive treatment. "Serious mental illness" includes major depression, schizophrenia, schizoaffective disorder, bipolar disorder, obsessive-compulsive disorder, panic disorder, posttraumatic stress disorder and borderline personality disorder.

History: Laws 2019, ch. 187, § 4; 2025, ch. 57, § 1; 2026, ch. 47, § 1.

ANNOTATIONS

Compiler's notes. — Laws 2019, ch. 187, § 4 was not enacted as part of the Insurance Code, but was compiled there for the convenience of the user.

The 2026 amendment, effective May 20, 2026, defined "chronic health condition", "chronic maintenance drug", and "serious mental illness", and revised the definition of "pharmacy benefits manager" as used in the Prior Authorization Act; added new Subsections C and D and redesignated former Subsections C through Q as Subsections E through S, respectively; in Subsection Q, after "means" deleted "an agent responsible for handling prescription drug benefits for a health insurer" and added "a person licensed by the superintendent as a pharmacy benefits manager pursuant to the provisions of the Pharmacy Benefits Manager Regulation Act that has a direct contract with an entity subject to the Health Care Purchasing Act"; and added Subsection T.

Applicability. — Laws 2026, ch. 47, § 5 provided that the provisions of Laws 2026, ch. 47 apply to an individual or group policy, contract, certificate or agreement to provide, deliver, arrange for, pay for or reimburse any of the costs of medical care, pharmaceutical benefits or related benefits that is entered into, offered or issued by a health insurer or pharmacy benefits manager on or after January 1, 2027, pursuant to any of the following:

A. Chapter 59A, Article 22 NMSA 1978;

B. Chapter 59A, Article 23 NMSA 1978;

C. the Health Maintenance Organization Law [Chapter 59A, Article 46 NMSA 1978];

D. the Nonprofit Health Care Plan Law [Chapter 59A, Article 47 NMSA 1978]; or

E. the Health Care Purchasing Act [Chapter 13, Article 7 NMSA 1978].

The 2025 amendment, effective June 20, 2025, defined "rare disease or condition" and revised the definitions of "off-label" and "prior authorization" as used in the Prior Authorization Act; added a new Subsection L and redesignated former Subsections L through O as Subsections M through P, respectively; in Subsection P, after "means a" added "voluntary or mandatory", and after "pre-service determination" added "including a recommended clinical review"; and added Subsection Q.