2013 -- S 0029

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STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2013

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A N A C T

RELATING TO STATE AFFAIRS AND GOVERNMENT -- MEDICAID FRAUD AND

WASTE PREVENTION

     Introduced By: Senators Crowley, Miller, Sosnowski, Jabour, and Pearson

     Date Introduced: January 16, 2013

     Referred To: Senate Health & Human Services

It is enacted by the General Assembly as follows:

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     SECTION 1. Title 42 of the General Laws entitled “STATE AFFAIRS AND

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GOVERNMENT" is hereby amended by adding thereto the following chapter:

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     CHAPTER 14.7

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MEDICAID, RITE CARE AND RITE SHARE FRAUD AND WASTE REDUCTION

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     42-14.7-1. Short title. – This act shall be known as and may be cited as the “Medicaid

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and RIte Care and RIte Share Fraud and Waste Reduction Act.”

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     42-14.7-2. Legislative intent. – It is the intent of the general assembly to implement

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modern pre-payment prevention and recovery solutions to combat waste attributed to fraud, waste

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and abuse within Medicaid and the RIte Care and RIte Share programs.

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     42-14.7-3. Definitions. – The definitions in this section shall apply throughout this

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chapter unless the context requires otherwise:

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     (1) “Medicaid” means the program to provide grants to states for medical assistance

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programs established under title XIX of the Social Security Act (42 USC 1396 et seq.).

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     (2) “RIte Care” and “RIte Share” means the children’s health insurance program

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established under title XXI of the Social Security Act (42 USC 1397aa et seq.).

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     42-14.7-4. Application. – This chapter shall specifically apply to:

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     (1) State Medicaid managed care programs operated under this chapter or chapter 5.1 or

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chapter 12.3 of title 42 of the Rhode Island general laws.

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     (2) The RIte Care and RIte Share state programs operated under Rhode Island general

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laws, chapter 40-8.4.

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     42-14.7-5. Data verification. – The state shall implement provider data verification and

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provider screening technology solutions into the claims processing workflow to check healthcare

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billing and provider rendering data against a continually maintained provider information

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database for the purposes of automating reviews and identifying and preventing inappropriate

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payments to:

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     (1) Deceased providers;

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     (2) Sanctioned providers;

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     (3) License expiration/retired providers; and

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     (4) Confirmed wrong addresses.

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     42-14.7-6. Predictive modeling. – The state shall implement state-of-the-art predictive

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modeling and analytics technologies in a pre-payment position within the healthcare claim

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workflow to provide a more comprehensive and accurate view across all providers, beneficiaries

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and geographies within the Medicaid, RIte Care and RIte Share programs in order to:

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     (1) Identify and analyze those billing or utilization patterns that represent a high risk of

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fraudulent activity;

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     (2) Be integrated into the existing Medicaid and RIte Care and RIte Share claims

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workflow;

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     (3) Undertake and automate such analysis before payment is made to minimize

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disruptions to the workflow and speed claim resolution;

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     (4) Prioritize such identified transactions for additional review before payment is made

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based on likelihood of potential waste, fraud or abuse;

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     (5) Capture outcome information from adjudicated claims to allow for refinement and

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enhancement of the predictive analytics technologies based on historical data and algorithms

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within the system; and

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     (6) Prevent the payment of claims for reimbursement that have been indentified as

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potentially wasteful, fraudulent or abusive until the claims have been automatically verified as

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valid.

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     42-14.7-7. Cost of implementation to be offset by savings. – (a) The state may contract

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for services in order to comply with the provisions of this chapter; provided, however, that the

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cost of implementation of the provisions of this chapter shall be offset by savings generated by

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the reduction of fraud and waste within the state Medicaid, RIte Care and RIte Share programs.

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     (b) The state may execute contracts which are based on the following payment models:

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     (1) Percentage of achieved savings model;

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     (2) A per beneficiary per month model;

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     (3) A per transaction model;

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     (4) A case-rate model; or

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     (5) Any blended model of the aforementioned methodologies, which may also include

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performance guarantees by the contractor to ensure savings identified exceeds program costs.

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     42-14.7-8. Severability. – If any provision of this chapter or the application thereof to

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any person or circumstances is held invalid, such invalidity shall not affect other provisions or

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applications of the chapter, which can be given effect without the invalid provisions or

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applications, and to this end the provisions of this chapter are declared to be severable.

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     SECTION 3. This act shall take effect upon passage.

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N A C T

RELATING TO STATE AFFAIRS AND GOVERNMENT -- MEDICAID FRAUD AND

WASTE PREVENTION

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     This act would implement fraud and waste detection and reduction solutions within the

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state Medicaid, RIte Care and RIte Share programs.

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     This act would take effect upon passage.

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