2015 -- H 5387

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LC000981

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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2015

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A N   A C T

RELATING TO HEALTH AND SAFETY -- COMPREHENSIVE HEALTH INSURANCE

PROGRAM

     Introduced By: Representatives Regunberg, Tanzi, Handy, Maldonado, and Amore

     Date Introduced: February 11, 2015

     Referred To: House Finance

     It is enacted by the General Assembly as follows:

     SECTION 1. Title 23 of the General Laws entitled "HEALTH AND SAFETY" is hereby

amended by adding thereto the following chapter:

CHAPTER 94

THE RHODE ISLAND COMPREHENSIVE HEALTH INSURANCE PROGRAM

     23-94-1. Legislative findings and purpose. -- The general assembly finds that Rhode

Island residents face significant and increasingly overwhelming problems obtaining adequate

affordable health insurance due to unnecessary costs and obstacles created by our current health

insurance system, and that removing the burden on Rhode Island businesses to secure health

insurance for employees will benefit the state's economic development. This chapter, therefore,

creates an affordable, comprehensive, and effective health insurance program to benefit all Rhode

Island residents.

     23-94-2. Definitions. -- As used in this chapter:

      (1) "Dependent" has the same definition as set forth in federal tax law (26 U.S.C. § 152).

     (2) "Emergency and urgently needed services" has the same definition as set forth in the

federal Medicare law (42 CFR 422.113).

     (3) "For-profit provider" means any healthcare professional or healthcare institution that

provides payments, profits or dividends to investors or owners who do not directly provide

healthcare.

     (4) "Qualified Rhode Island resident" means any individual who is a "resident" as defined

by §§ 44-30-5(1) and (2) or a dependent of that resident.

     (5) "Program" means, "the Rhode Island comprehensive health insurance program"

(RICHIP).

     (6) "RICHIP Premiums" means funds from qualified Rhode Island residents that are

placed into the RICHIP trust fund pursuant to § 23-94-11, and are based on income and unearned

income including capital gains.

     23-94-3. Rhode Island Comprehensive Health Insurance Program. -- (a)

Organization. This chapter repeals § 42-14.5-3, establishing duties of the health insurance

commissioner, and creates the Rhode Island comprehensive health insurance program (RICHIP),

an independent government agency consisting of a director and staff, as set forth below.

     (b) Director. A director shall be appointed by the governor with the advice and consent of

the senate to lead RICHIP and serve a term of six (6) years. The director shall be compensated in

accordance with the job title and job classification established by the division of human resources

and approved by the general assembly. The director may be removed by a two-thirds (2/3)

majority vote of each house of the general assembly. The director shall have the following duties:

     (1) Oversee management of the RICHIP trust fund;

     (2) Create and oversee RICHIP budgets;

     (3) Appoint an advisory committee of healthcare professionals and others (hereinafter,

the "RICHIP advisory committee");

     (4) Establish RICHIP benefits as set forth in § 23-94-5;

     (5) Establish RICHIP provider reimbursement as set forth in § 23-94-8;

     (6) Coordinate with the state comptroller to facilitate billing from and payments to

providers using the state's computerized financial system, the Rhode Island financial and

accounting network system (RIFANS);

     (7) Coordinate with federal healthcare programs, including Medicare and Medicaid, to

streamline federal funding and reimbursement;

     (8) Monitor billing and reimbursements to detect inappropriate behavior by providers and

patients;

     (9) Oversee RICHIP registration for qualified Rhode Island residents;

     (10) Create RICHIP expenditure, status, and assessment reports;

     (11) Review RICHIP disbursements on a quarterly basis and recommend adjustments in

fee schedules needed to achieve budgetary targets and permit adequate access to care;

     (12) Review capital budget proposals from providers;

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     (13) Create a committee to study long-term care and develop a plan to deal with this

healthcare necessity;

     (14) Create other prohibitions regarding RICHIP participation, and procedures by which

they will be enforced.

     23-94-4. Extent of coverage. -- (a) Eligibility. All qualified Rhode Island residents are

eligible to be covered under RICHIP.

     (b) Registration. The director shall develop procedures by which:

     (1) RICHIP can identify, automatically register, and provide a RICHIP card to qualified

Rhode Island residents identified by September 1, 2015; and

     (2) RICHIP can process applications from individuals seeking to become qualified Rhode

Island residents or obtain RICHIP coverage for dependents after September 1, 2015.

     (c) Disqualification. The director shall establish criteria and procedures for disqualifying

individuals from receiving RICHIP benefits or funds, including for ceasing to be a resident of

Rhode Island, and for RICHIP-related criminal activity (e.g., the fraudulent receiving of benefits

or reimbursements). Disqualified individuals shall be required to reimburse RICHIP for all

benefits or funds they received upon disqualification and may be subject to civil and criminal

penalties.

     (d) Medicare eligible residents. Qualified Rhode Island residents eligible for federal

Medicare ("Medicare eligible residents") shall continue to pay required fees to the federal

government. RICHIP shall establish procedures to ensure that Medicare eligible residents shall

have such amounts deducted from what they owe to RICHIP under § 23-94-11. RICHIP shall

become the equivalent of qualifying coverage under Medicare part D and Medicare advantage

programs, and as such shall be the vendor for coverage to qualified Rhode Island residents.

RICHIP shall provide Medicare eligible residents benefits equal to those available to all other

RICHIP participants and equal to or greater than those available through the federal Medicare

programs. To streamline the process, RICHIP shall seek to receive federal reimbursements for

services to Medicare eligible residents and administer all Medicare funds.

     (e) Medicaid eligible residents. RICHIP shall become the state's sole Medicaid provider.

RICHIP shall create procedures to enroll all qualified Rhode Island residents eligible for

Medicaid ("Medicaid eligible residents" in the federal Medicaid program to ensure a maximum

amount of federal Medicaid funds go to the RICHIP trust fund. RICHIP shall provide benefits to

Medicaid eligible residents equal to those available to all other RICHIP participants.

     23-94-5. RICHIP benefits. -- (a) In general. This chapter shall provide insurance

coverage for services, goods and prescription drugs currently covered under the federal Medicare

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program (Social Security Act title XVIII) parts A, B and D. The director may permit additional

medically necessary coverage within the following general categories:

     (1) Primary and preventive care.

     (2) Approved dietary and nutritional therapies.

     (3) Inpatient care.

     (4) Outpatient care.

     (5) Emergency and urgently needed care

     (6) Prescription drugs.

     (7) Approved medical goods.

     (8) Palliative care.

     (9) Mental health services.

     (10) Dental services, including periodontics, oral surgery, and endodontics.

     (11) Substance abuse treatment services.

     (12) Physical therapy and chiropractic services.

     (13) Vision care and vision correction.

     (14) Hearing services, including coverage of hearing aids.

     (15) Podiatric care.

     (b) RICHIP benefits. RICHIP Benefits shall, at a minimum, be the same as those covered

by the federal Medicare program, as defined by applicable federal statute and regulations. The

director shall create a procedure that permits increases in coverage beyond that provided by the

federal Medicare program within the areas set forth in § 23-94-5(a) in consultation with the

RICHIP advisory committee.

     23-94-6. Providers. -- (a) Rhode Island providers.

     (1) Licensing. Participating providers must meet state licensing requirements in order to

participate in the program. No provider whose license is under suspension or has been revoked

may participate in the program.

     (2) Participation. All providers may participate in RICHIP by providing items on the

RICHIP benefits list for which they are licensed. Providers may elect either to participate fully, or

not at all, in the program.

     (3) For-Profit providers. For-profit providers may continue to offer services and goods in

Rhode Island, but are prohibited from charging patients more than RICHIP reimbursements rates

for covered services and goods and must notify qualified Rhode Island residents when the

services and goods they offer will not be reimbursed under RICHIP.

     (b) Out-of-state providers. Except for emergency and urgently needed service, as set forth

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in § 23-94-7 below, RICHIP shall not pay for healthcare services obtained outside of Rhode

Island unless the following requirements are met:

     (1) The patient secures a written referral from a qualified Rhode Island physician prior to

seeking such services; and

     (2) The referring physician determines that the services are not available in the state or

cannot be performed within the state at the level of expertise medically necessary.

     (c) Out-of-state provider reimbursement. The program shall pay out-of-state healthcare

providers an amount not to exceed the RICHIP rate. The qualified Rhode Island resident is

responsible for paying all costs of our-of-state services that fail to meet requirement §§ 23-94-

6(b)(1) and (b)(2). Qualified Rhode Island residents are responsible for paying out-of-state

providers for costs in excess of RICHIP reimbursements.

     (d) Out-of-state residents. Rhode Island providers who provide any services to

individuals who are not qualified Rhode Island residents shall not be reimbursed by RICHIP and

must seek reimbursement from those individuals or other sources.

     23-94-7. Emergency and urgently needed services exceptions. (a) In Rhode Island.

Nothing in this chapter prevents any individual from receiving or any provider from giving

emergency or urgently needed services in Rhode Island. RICHIP shall reimbursement all

providers for emergency and urgently needed services given to qualified Rhode Island residents

to the extent provided for under the federal Medicare program in accordance with § 23-94-9,

below.

     (b) Out-of-State. The program shall pay for emergency and urgently needed services that

are obtained by qualified Rhode Island residents anywhere outside Rhode Island to the same

extent allowed under the federal Medicare program in accordance with § 23-94-9, below.

Qualified Rhode Island residents are responsible for paying out-of-state providers for costs in

excess of RICHIP reimbursements.

     23-94-8. Private Insurance Companies. -- (a) Non-duplication. It is unlawful for a

private health insurer to sell health insurance coverage to qualified Rhode Island residents outside

of employer-provided health benefit programs that duplicates the benefits provided under this

chapter.

     (b) Displaced employees. Re-education and job placement of persons employed in

Rhode Island-located enterprises who have lost their jobs as a result of this chapter shall be

managed by the Rhode Island department of labor and training or an appropriate federal

retraining program.

     23-94-9. Provider Reimbursement. -- (a) Rates. RICHIP reimbursements to providers

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shall be the same as the federal Medicare program reimbursement rates in effect at the time

services, goods or prescription drugs are provided. If the director determines that there are no

applicable Medicare reimbursement rates or that such rates are significantly different from those

in neighboring states, the director shall create such rates in consultation with the RICHIP

advisory committee.

     (b) Billing and payments. Providers shall submit billing for services to qualified Rhode

Island residents in the form of electronic invoices entered into RIFANS, the State's computerized

financial system. The director shall coordinate the manner of processing and payment with the

office of accounts and control and the RIFANS support team within the division of information

technology. Payments shall be made by check or electronic funds transfer in accordance with

terms and procedures coordinated by the director and the office of accounts and control and

consistent with the fiduciary management of the RICHIP trust fund.

     (c) Provider restrictions. Providers who accept any payment from RICHIP may not bill

any patient for any covered benefit. Providers cannot use any of their operating budgets for

expansion, profit, excessive executive income, marketing, or major capital purchases or leases.

     23-94-10. Budgeting. -- (a) Operating budget. Annually, the director shall create an

operating budget for the program that includes the costs for all benefits set forth in § 23-94-5 and

the costs for RICHIP administration. The director shall determine appropriate reimbursement

rates for benefits pursuant to § 23-94-9(a).

     (b) Capital Expenditures. The director and the Rhode Island department of administration

office of capital projects shall review the capital expenditure budgets proposed by providers,

including amounts to be spent on construction and renovation of health facilities and major

equipment purchases. To the extent that providers are seeking RICHIP funds for capital

expenditures, the director shall have the authority to approve or deny such funding.

     (c) Prohibition against co-mingling operations and capital improvement funds. It is

prohibited to use funds under this chapter that are earmarked:

     (1) For operations for capital expenditures; or

     (2) For capital expenditures for operations.

     (d) Limits. The total overhead and administrative portion of the program budget may not

exceed twelve percent (12%) of the total operating budget of the program for the first two (2)

years that the program is in operation; eight percent (8%) for the following two (2) years; and five

percent (5%) for each year thereafter.

     23-94-11. Financing. -- (a) RICHIP trust fund. There shall be established a RICHIP trust

fund into which funds collected pursuant to this chapter are deposited and from which funds are

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distributed. The governor or general assembly may provide funds to the RICHIP trust fund, but

may not remove or borrow funds from the RICHIP trust fund.

     (b) Savings. RICHIP will lower healthcare costs by:

     (1) Eliminating payments for expensive, non-comprehensive private healthcare

insurance;

     (2) Reducing paperwork and administrative expenses;

     (3) Allowing public health strategic planning; and

     (4) Improving access to preventive healthcare.

     (c) Funding. Funds sufficient to carry out this chapter shall be obtained in the following

ways and may be changed only by a two-thirds (2/3) majority vote of the each house of the

general assembly.

     (1) Seeking the maximum amount of existing and future federal government funds

available for Rhode Island residents' healthcare, including, but not limited to, funds under the

Medicare program, under title XVIII of the Social Security Act, under the Medicaid program

under title XIX of such act, and under the children's health insurance program under title XXI of

such act;

     (2) Collecting RICHIP premiums;

     (3) Applying any other funds specifically ear-marked for healthcare or healthcare

education, such as settlements from litigation.

     23-94-12. Compliance with federal laws. -- RICHIP shall comply with all applicable

federal laws, including the ACA and privacy laws.

     SECTION 2. This act shall take effect upon passage.

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N   A C T

RELATING TO HEALTH AND SAFETY -- COMPREHENSIVE HEALTH INSURANCE

PROGRAM

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     This act would establish the Rhode Island comprehensive health insurance program

     This act would take effect upon passage.

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LC000981

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