1. A. A health insurer or pharmacy benefits manager that offers prior authorization shall:

   1. (1) use the uniform prior authorization forms developed by the office for medical care, for pharmaceutical benefits or related benefits pursuant to Section 59A-22B-4 NMSA 1978 and for prescription drugs pursuant to Section 59A-2-9.8 NMSA 1978;

   2. (2) establish and maintain an electronic portal system for:

      1. (a) the secure electronic transmission of prior authorization requests on a twenty-four-hour, seven-day-a-week basis, for medical care, pharmaceutical benefits or related benefits; and
      2. (b) auto-adjudication of prior authorization requests;
   3. (3) provide an electronic receipt to the health care provider and assign a tracking number to the health care provider for the health care provider's use in tracking the status of the prior authorization request, regardless of whether or not the request is tracked electronically, through a call center or by facsimile;
   4. (4) auto-adjudicate all electronically transmitted prior authorization requests to approve or pend a request for benefits; and
   5. (5) accept requests for medical care, pharmaceutical benefits or related benefits that are not electronically transmitted.

2. B. Prior authorization shall be deemed granted for prescription drug determinations not made within three business days, and for all other determinations not made within seven days; provided that:

   1. (1) an adjudication shall be made within twenty-four hours, or shall be deemed granted if not made within twenty-four hours, when a covered person's health care professional requests an expedited prior authorization and submits to the health insurer or pharmacy benefits manager a statement that, in the health care professional's opinion that is based on reasonable medical probability, delay in the treatment for which prior authorization is requested could:

      1. (a) seriously jeopardize the covered person's life or overall health;
      2. (b) affect the covered person's ability to regain maximum function; or
      3. (c) subject the covered person to severe and intolerable pain; and
   2. (2) the adjudication time line shall commence only when the health insurer or pharmacy benefits manager receives all necessary and relevant documentation supporting the prior authorization request.
3. C. An insurer or a pharmacy benefits manager may automatically deny a covered person's prior authorization request that is electronically submitted and that relates to a prescription drug that is not on the covered person's health benefits plan formulary; provided that the insurer or pharmacy benefits manager shall accompany the denial with a list of alternative drugs that are on the covered person's health benefits plan formulary.
4. D. Upon denial of a covered person's prior authorization request based on a finding that a prescription drug is not on the covered person's health benefits plan formulary, a health insurer or pharmacy benefits manager shall notify the person of the denial and include in a conspicuous manner information regarding the person's right to initiate a drug formulary exception request and the process to file a request for an exception to the denial.
5. E. An auto-adjudicated prior authorization request based on medical necessity that is pended or denied shall be reviewed by a health care professional who has knowledge or consults with a specialist who has knowledge of the medical condition or disease of the covered person for whom the authorization is requested. The health care professional shall make a final determination of the request. If the request is denied after review by a health care professional, notice of the denial shall be provided to the covered person and covered person's provider with the grounds for the denial and a notice of the right to appeal and describing the process to file an appeal.
6. F. A health insurer or pharmacy benefits manager shall establish a process by which a health care provider or covered person may initiate an electronic appeal of a denial of a prior authorization request.
7. G. A health insurer or pharmacy benefits manager shall have in place policies and procedures for annual review of its prior authorization practices to validate that the prior authorization requirements advance the principles of lower cost and improved quality, safety and service.
8. H. The office shall establish by rule protocols and criteria pursuant to which a covered person or a covered person's health care professional may request expedited independent review of an expedited prior authorization request made pursuant to Subsection B of this section following medical peer review of a prior authorization request pursuant to the Prior Authorization Act.

History: Laws 2019, ch. 187, § 7; 2025, ch. 57, § 2; 2026, ch. 47, § 3.

ANNOTATIONS

Compiler's notes. — Laws 2019, ch. 187, § 7 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, included pharmacy benefits managers within the scope of the section, and provided that prior authorization shall be deemed granted for prescription drug determinations not made within three business days; after each occurrence of "health insurer" added "pharmacy benefits manager" throughout the section; and in Subsection B, after "deemed granted for" added "prescription drug", and after "not made within" added "three business days, and for all other determinations not made within".

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, made certain amendments to reflect revisions to prior authorization requirements, and made technical amendments; in Subsection A, in the introductory clause, after "A health insurer that" deleted "requires" and added "offers" and in Paragraph A(1), after "Section" deleted "6 of this 2019 act" and added "59A-22B-4 NMSA 1978".