2012 -- H 7873

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LC01847

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STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2012

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A N A C T

RELATING TO INSURANCE - MINIMUM PHYSICIANS' PAYMENT ACT OF 2012

     Introduced By: Representative Donald J. Lally

     Date Introduced: March 01, 2012

     Referred To: House Corporations

It is enacted by the General Assembly as follows:

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     SECTION 1. Title 27 of the General Laws entitled "INSURANCE" is hereby amended

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by adding thereto the following chapter:

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     CHAPTER 69.1

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MINIMUM PHYSICIANS' PAYMENT ACT OF 2012

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     27-69.1-1. Short title. – This chapter shall be known, and may be cited as the “Minimum

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Physicians’ Payment Act of 2012” or “MPPA”.

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     27-69.1-2. Legislative findings. – The general assembly hereby finds and declares as

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follows:

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     (1) Most Rhode Island physicians are paid substantially less by commercial health

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insurers than are physicians providing the same services in Connecticut and Massachusetts;

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     (2) This payment inequity has made it difficult to recruit and retain physicians in Rhode

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Island;

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     (3) The inability to recruit and retain sufficient numbers of physicians poses a long-term

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threat to Rhode Islanders’ ability to access high quality medical care;

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     (4) The federal Medicare program has a well established and generally fair method for

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determining physician reimbursement;

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     (5) Commercial health insurers in Connecticut and Massachusetts generally reimburse

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physicians at greater rates than does Medicare; and

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     (6) This chapter is necessary and proper, and constitutes an appropriate exercise of the

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authority of this state to regulate the delivery of health care services in order to safeguard the

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public health and safety of Rhode Islanders.

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     27-69.1-3. Definitions. – The following words and phrases, when used in this chapter,

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shall have the meanings given to them in this section unless the context clearly indicates

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otherwise:

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     (1) “Department” means the Rhode Island department of health.

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     (2) “Eligible physician” means any person licensed as a physician by the department

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pursuant to chapter 5-37, who is a participating provider in Rhode Island of medical assistance

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and RIteCare and certifies to the director of the department annually that at least five percent

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(5%) of the care provided by the physician is free care as defined by the department and provides

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medical services within a designated medically underserved practice area.

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     (3) “Health care insurer” means a health care insurer whose premiums are paid in whole

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or in part by employers and as otherwise defined in section 27-20.6-1, including any health care

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insurer affiliate or third-party administrator interacting with hospitals and enrollees on behalf of

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such an insurer, but specifically not including the following types of insurance policy:

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     (i) Hospital confinement indemnity;

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     (ii) Disability income;

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     (iii) Accident only;

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     (iv) Long-term care;

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     (v) Medicare supplement;

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     (vi) Limited benefit health;

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     (vii) Specified disease indemnity;

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     (viii) Sickness or bodily injury or death by accident or both;

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     (ix) Other limited benefit policies; and

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     (x) Health care insurance issued or administered by a small health care insurer.

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     (4) “Health care insurer affiliate” means a health care insurer that is affiliated with

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another entity by either the insurer or entity having a five percent (5%) or greater, direct or

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indirect, ownership or investment interest in the other through equity, debt or other means.

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     (5) “Medically underserved practice area” means any recognized specialty medical

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service provided by a licensed physician in accordance with chapter 5-37, that has a population to

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physician ratio of one per ten thousand (10,000) Rhode Island residents.

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     27-69.1-4. Designation of a medically underserved practice area. – The director of the

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department of health shall designate an area or population group a medically underserved area

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based upon the ratio set forth in subdivision 69.1-3(5) of this chapter. The director may also take

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into consideration other factors that may include, but not be limited to, indicators of insufficient

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capacity to meet existing needs and the average age of the licensed physicians in a medical

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specialty service. Said designations shall be made within ninety (90) days of enactment of this

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chapter and shall be reviewed on an annual basis.

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     27-69.1-5. Minimum payments. – (a) Health insurers shall reimburse eligible

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physicians, no less than one hundred forty percent (140%) of what Medicare would pay the

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physician for providing the same service.

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     (b) Nothing in this chapter shall be construed to prohibit a physician, or the physician’s

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lawful employer, from contracting with a health insurer to receive greater reimbursement than

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that required under this chapter.

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     SECTION 2. This act shall take effect upon passage.

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LC01847

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N A C T

RELATING TO INSURANCE - MINIMUM PHYSICIANS' PAYMENT ACT OF 2012

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     This act would require health insurers to reimburse physicians no less than one hundred

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forty percent (140%) of what Medicare would pay the physician for providing the same service.

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     This act would take effect upon passage.

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LC01847

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