Texas Prior Authorization Exemption: 5 Easy Essentials
A Texas prior authorization exemption lets a provider skip preauthorization for a particular health care service after the provider’s past requests were approved at a high rate. The Texas Department of Insurance (TDI) calls these preauthorization exemptions, and many people call them gold cards. This guide explains how one works for psychotherapy and psychiatry practices, which plans it covers, and what to track.
How a Texas prior authorization exemption works
The exemption belongs to a provider, a service and an insurer. TDI’s FAQ (last updated September 2, 2025) sets out the main rules, summarized below.
| Question | What TDI says |
|---|---|
| Who qualifies | Physicians and providers as broadly defined in Texas Insurance Code §843.002; tied to the NPI used to submit requests; not limited to in-network providers |
| Which services | Each service that the insurer requires preauthorization for; each insurer publishes its own list |
| Threshold | At least five eligible requests for the service in the latest evaluation period, with at least 90 percent approved |
| Evaluation | At least once a year; under House Bill 3812 each period lasts 12 months |
| How to get one | No application; submit requests as usual and the insurer evaluates and sends a notice |
| How it ends | When the service no longer needs preauthorization or the exemption is rescinded; rescissions only in January of a qualifying year |
TDI says HB 3812 took effect September 1, 2025. Its changes include annual 12-month evaluations, new rescission timing, independent review of exemption denials, and counting requests across all of an insurer’s plan types.
Does a Texas prior authorization exemption apply to behavioral health?
It can, but only for services your insurer requires preauthorization for in the first place. TDI’s FAQ does not mention behavioral health. The behavioral health page of Blue Cross and Blue Shield of Texas says House Bill 3459 allows some providers an exemption from submitting behavioral health preauthorization requests for certain services, for fully insured groups and some administrative-services-only groups. Check each payer in eligibility verification first, because an exemption only matters if the service needs authorization.
Rules by payer type
Private payers
TDI says a Texas prior authorization exemption covers TDI-regulated commercial HMO, PPO and exclusive provider plans, including individual marketplace plans, fully insured employer plans, and state employee and teacher plans. It does not cover self-funded employer plans or workers’ compensation. Exemptions are granted by the insurer and apply to all of that insurer’s TDI-regulated plans. The same Blue Cross page lists services needing preauthorization, including partial hospitalization, intensive outpatient programs, applied behavior analysis (ABA) and transcranial magnetic stimulation (TMS). The Blue Cross PPO manual (updated March 4, 2026) says requirements vary by plan. Psychiatrists who offer TMS should check these rules first. See our Texas Blue Cross guide and the Texas insurance companies contact page.
Medicare and Medicaid
TDI says a Texas prior authorization exemption does not cover Medicaid and CHIP, including managed care plans, or Medicare Advantage and Part D. Use the plan’s own rules instead, starting with our Texas Medicaid billing guide.
State rules
The Texas prior authorization exemption comes from Texas Insurance Code Chapter 4201, Subchapter N. TDI says denials and rescissions can go to an independent review organization (IRO) without first using the insurer’s internal appeal. Reasons for a denial appear on the remittance; our CARC and RARC code guide helps you read them.
How does a provider get a prior authorization exemption in Texas?
There is no application. You submit preauthorization requests as usual. If you have at least five eligible requests for a service in the latest evaluation period and at least 90 percent were approved, the insurer sends a notice that the exemption starts.
What to do Monday morning
Use these steps to put a Texas prior authorization exemption to work in your practice.
- List the services each of your payers requires preauthorization for.
- Track requests by payer, service and the NPI that submitted them, with the outcome.
- Update your contact preferences with each insurer so you receive its evaluation notice.
- When a notice arrives, record the service, insurer and effective date in your verification notes.
- Calendar each January to check for a rescission, and ask about independent review if a denial or rescission looks wrong.
The short version: Texas prior authorization exemption
A Texas prior authorization exemption is earned per provider, service and insurer through a high approval rate, and it does not reach Medicaid, CHIP, Medicare Advantage or self-funded plans. Track your requests and confirm the service needs authorization at all.
How MCM South helps
MCM South Medical Billing Service, LLC bills exclusively for mental and behavioral health. We work with psychotherapists and psychiatrists in solo and medium-size practices, and we bill out-of-network claims for clients.
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FAQ
Does a Texas prior authorization exemption apply to psychotherapy sessions?
Only if your insurer requires preauthorization for the service you bill. If routine sessions do not need authorization, there is nothing to exempt. Check this for each payer during verification.
Is the exemption tied to me or to my group?
TDI says exemptions are tied to the NPI under which a provider submits requests, so a clinician who submits under their own NPI needs their own exemption. Ask each insurer how it applies the rule to your group.
Can an insurer take the exemption away?
TDI says rescissions are allowed only in January of a qualifying year and take effect 30 days after notice, or five days after an independent review organization affirms it if appealed. Denials and rescissions can go to an IRO.
Do self-funded employer plans have to honor it?
TDI says no. The exemption covers TDI-regulated commercial plans and does not cover self-funded employer plans, workers’ compensation, Medicaid, CHIP, Medicare Advantage or Part D.
Where MCM South works
MCM South Medical Billing Service, LLC works with psychotherapists and psychiatrists in our ten currently served states: Georgia, Massachusetts, Connecticut, Texas, Florida, New York, Colorado, Tennessee, North Carolina and Illinois. We serve solo and medium-size practices that bill mental and behavioral health. Founder Michael Williams has worked with insurance payers in all 50 states. Browse the state and regional billing guides for rules that vary by state, or see our billing services.
This post is operational guidance for billing, not legal advice. Rules change, so confirm with the payer or your counsel.
