2013 -- S 0282

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LC00382

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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 -- PROGRAM INTEGRITY FOR

MEDICAID, RITE CARE AND RITE SHARE PROGRAM

     Introduced By: Senators Crowley, Sosnowski, Ottiano, and Nesselbush

     Date Introduced: February 12, 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 Government" is

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hereby amended by adding thereto the following chapter:

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     CHAPTER 14.7

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THE MEDICAID, RITE CARE AND RITE SHARE PROGRAM INTEGRITY ACT

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

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RIte Care and RIte Share Integrity Act.”

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     42-14.7-2. Legislative intent. – It is the intent of the legislature to implement waste,

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fraud and abuse detection, prevention and recovery solutions to:

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     (1) Improve program integrity for Medicaid and the RIte care and RIte share programs in

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the state and create efficiency and cost savings through a shift from a retrospective “pay and

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chase” model to a prospective pre-payment model; and

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     (2) Comply with program integrity provisions of the federal patient protection and

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affordable care act and the health care and education reconciliation act of 2010, as promulgated in

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the centers for medicare and medicaid services final rule 6028.

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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 U.S.C. 1396 et seq.).

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     (2) “RIte care and RIte share” means the children’s health insurance program established

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under title XXI of the social security act (42 U.S.C. 1397aa et seq.).

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     (3) “Enrollee” means an individual who is eligible to receive benefits and is enrolled in

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either medicaid or RIte care and RIte share programs.

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     (4) “Secretary” means the U.S. secretary of health and human services, acting through the

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administrator of the centers for medicare and medicaid services.

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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 section 42-12.4-2 of the

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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 40-84.

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

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provides screening technology solutions to check healthcare billing and provider rendering data

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against a continually maintained provider information database for the purposes of automating

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reviews and identifying and preventing inappropriate 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. Clinical code editing. – The state shall implement state-of-the art clinical

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code editing technology solutions to further automate claims resolution and enhance cost

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containment through improved claim accuracy and appropriate code correction. The technology

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shall identify and prevent errors or potential overbilling based on widely accepted and transparent

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protocols such as the american medical association and the centers for medicare and medicaid

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services. The edits shall be applied automatically before claims are adjudicated to speed

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processing and reduce the number of pended or rejected claims and help ensure a smoother, more

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consistent and more transparent adjudication process and fewer delays in provider

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reimbursement.

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     42-14.7-7. Predictive modeling. – The state shall implement state-of-the-art predictive

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modeling and analytics technologies to provide more comprehensive and accurate view across all

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providers, beneficiaries and geographies within the Medicaid, RIte care and RIte share programs

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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 identified 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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     42-14.7-8. Fraud investigations. –- The state shall implement fraud investigative

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services that combine retrospective claims analysis and prospective waste, fraud or abuse

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detection techniques. These services shall include analysis of historical claims data, medical

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records, suspect provider databases and high-risk identification lists, as well as direct patient and

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provider interviews. Emphasis shall be placed on providing education to providers and ensuring

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that they have the opportunity to review and correct any problems identified prior to adjudication

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     42-14.7-9. Recovery of improper payments. –- The state shall implement medicaid

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claims audit and recovery services to identify improper payments due to non-fraudulent issues,

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audit claims, obtain provider sign-off on the audit results and recover validated overpayments.

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Post payment reviews shall ensure that the diagnoses and procedure codes are accurate and valid

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based on the supporting physician documentation within the medical records. Core categories of

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review include: coding compliance diagnosis related group (DRG) reviews, transfers,

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readmissions, cost outlier reviews, outpatient 72-Hour rule reviews, payment errors, billing errors

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and others.

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     42-14.7-10. Reporting. –- The following reports shall be completed by the department of

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health and human services:

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     (1) Not later than three (3) months after the completion of the first implementation year

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under this chapter, the state shall submit to the appropriate committees of the legislature, and

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make available to the public, a report that includes the following:

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     (i) A description of the implementation and use of technologies included in this chapter

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during the year;

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     (ii) A certification by the department of human services that specifies the actual and

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projected savings to the medicaid, RIte care and RIte share programs as a result of the use of

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these technologies, including estimates of the amounts of such savings with respect to both

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improper payments recovered and improper payments avoided;

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     (iii) The actual and projected savings to the Medicaid RIte care and RIte share programs

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as a result of such use of technologies relative to the return on investment for the use of such

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technologies and in comparison to other strategies or technologies used to prevent and detect

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fraud, waste, and abuse;

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     (iv) Any modifications or refinements that should be made to increase the amount of

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actual or projected savings or mitigate any adverse impact on medicare beneficiaries or providers;

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     (v) An analysis of the extent to which the use of these technologies successfully

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prevented and detected waste, fraud, or abuse in the medicaid and RIte care and RIte share

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programs;

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     (vi) A review of whether the technologies affected access to, or the quality of, items and

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services furnished to Medicaid RIte care and RIte share beneficiaries, and

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     (vii) A review of what effect, if any, the use of these technologies had on Medicaid, RIte

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care and RIte share providers, including assessment of provider education efforts and

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documentation of processes for providers to review and correct problems that are identified.

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     (2) Not later than three (3) months after the completion of the second implementation

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year under this chapter, the state shall submit to the appropriate committees of the legislature and

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make available to the public a report that includes, with respect to such year, the items required

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under subdivision (1) as well as any other additional items determined appropriate with respect to

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the report for such year.

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     (3) Not later than three (3) months after the completion of the third implementation year

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under this chapter, the state shall submit to the appropriate committees of the legislature, and

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make available to the public, a report that includes with respect to such year, the items required

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under subdivision (1), as well as any other additional items determined appropriate with respect

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to the report for such year.

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     SECTION 2. 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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LC00382

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N A C T

RELATING TO STATE AFFAIRS AND GOVERNMENT -- PROGRAM INTEGRITY FOR

MEDICAID, RITE CARE AND RITE SHARE PROGRAM

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     This act would create a review process for medicaid, RIte care and RIte share payment

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accuracy.

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     This act would take effect upon passage.

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LC00382

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