2015 -- S 0225

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LC000151

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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 STATE AFFAIRS AND GOVERNMENT -- CORRECTIONAL

INSTITUTIONS

     Introduced By: Senators Walaska, and McCaffrey

     Date Introduced: February 11, 2015

     Referred To: Senate Finance

     It is enacted by the General Assembly as follows:

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

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

CHAPTER 56.4

CORRECTIONAL HEALTHCARE COST REDUCTION

     42-56.4-1. Legislative findings. -- The legislature finds and declares that states have

saved millions of dollars by implementing solutions to eliminate and recover correctional

healthcare overpayments. Similarly, states have significantly reduced correctional healthcare

costs by billing Medicaid for eligible inpatient healthcare costs. Therefore, it is the intent of the

legislature to implement automated payment detection, prevention and recovery solutions to

reduce correctional healthcare overpayments and to assure that Medicaid is billed for eligible

inpatient hospital and professional services.

     42-56.4-2. Application. -- Unless otherwise stated, the chapter shall specifically apply to:

     (1) State correctional healthcare systems and services.

     (2) State contracted managed correctional healthcare services.

     42-56.4-3. Clinical code editing technology. -- The state shall implement state-of-the-art

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

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

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

referenceable protocols such as the American Medical Association and the Centers for Medicare

and Medicaid Services. The edits shall be applied automatically before claims are adjudicated to

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

more consistent and more open adjudication process and fewer delays in provider reimbursement.

     42-56.4-4. Healthcare claims auditing. -- The state shall implement correctional

healthcare claims audit and recovery services to identify improper payments due to non-

fraudulent issues, audit claims, obtain provider sign-off on the audit results and recover validated

overpayments. Post payment reviews shall ensure that the diagnosis and procedure codes are

accurate and valid based on the supporting physician documentation within the medical records.

Core categories of reviews could include coding compliance diagnosis related group (DRG)

reviews, transfers readmissions, cost outlier reviews, outpatient seventy-two (72) hour rule

reviews, payment errors, billing errors, and others.

     42-56.4-5. Automated payment detection -- Prevention and recovery services. -- The

state shall implement automated payment detection, prevention and recovery solutions to assure

that Medicaid is billed for eligible inpatient hospital and professional services.

     42-56.4-6. Implementation. -- It is the intent of the legislature that the state shall

contract for these services and that the savings achieved through this chapter shall more than

cover the cost of implementation and administration. Therefore, to the extent possible, technology

services used in carrying out this chapter shall be secured using the savings generated by the

program, whereby the state’s only direct cost will be funded through the actual savings achieved.

Further, to enable this model, reimbursement to the contractor may be contracted on the basis of a

percentage of achieved savings model, a per beneficiary per month model, a per transaction

model, a case-rate model, or any blended model of the aforementioned methodologies.

Reimbursement models with the contractor may also include performance guarantees of the

contractor to ensure savings identified exceeds program costs.

     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 STATE AFFAIRS AND GOVERNMENT -- CORRECTIONAL

INSTITUTIONS

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     This act would reduce inmate healthcare costs by billing Medicaid for eligible inpatient

hospital and professional services.

     This act would take effect upon passage.

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LC000151

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