Substance use disorder coverage.

Assembly Member Haney's substance use disorder treatment legislation removes key insurance barriers by prohibiting medical necessity reviews during critical treatment periods. Starting January 1, 2027, health plans and insurers cannot conduct concurrent or retrospective reviews for the first 28 days of inpatient substance use disorder treatment or for outpatient visits. The bill also eliminates prior authorization requirements for outpatient prescription drugs when deemed medically necessary by a physician.

For extended inpatient stays beyond 28 days, plans may conduct concurrent reviews no more frequently than every two weeks. If continued care is denied, patients retain appeal rights and cannot be discharged until appeals are exhausted. Plans must cover treatment through the day after a denial, with patients responsible only for standard cost-sharing. The bill applies similar provisions to intensive outpatient and partial hospitalization programs, allowing retrospective review only after the initial 28-day period using American Society of Addiction Medicine criteria.

The legislation maintains existing medical necessity standards and preserves current exemptions for county Drug Medi-Cal organized delivery systems. Health plans face criminal penalties for willful violations, though the bill requires no state reimbursement to local agencies since changes relate only to crime definition modifications under California's constitution.