2015 -- S 0422 SUBSTITUTE A

========

LC001455/SUB A/4

========

     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2015

____________

A N   A C T

RELATING TO UTILIZATION REVIEW - TRANSPARENCY IN PROSPECTIVE

ASSESSMENT CRITERIA

     Introduced By: Senator Christopher S. Ottiano

     Date Introduced: February 25, 2015

     Referred To: Senate Health & Human Services

     (by request)

It is enacted by the General Assembly as follows:

     SECTION 1. Chapter 23-17.12 of the General Laws entitled "Health Care Services -

Utilization Review Act" is hereby repealed in its entirety.

CHAPTER 23-17.12

Health Care Services - Utilization Review Act

     23-17.12-1. Purpose of chapter. -- The purpose of the chapter is to:

      (1) Promote the delivery of quality health care in a cost effective manner;

      (2) Foster greater coordination between health care providers, patients, payors and

utilization review entities;

      (3) Protect patients, businesses, and providers by ensuring that review agents are

qualified to perform utilization review activities and to make informed decisions on the

appropriateness of medical care; and

      (4) Ensure that review agents maintain the confidentiality of medical records in

accordance with applicable state and federal laws.

     23-17.12-2. Definitions. -- As used in this chapter, the following terms are defined as

follows:

      (1) "Adverse determination" means a utilization review decision by a review agent not to

authorize a health care service. A decision by a review agent to authorize a health care service in

an alternative setting, a modified extension of stay, or an alternative treatment shall not constitute

an adverse determination if the review agent and provider are in agreement regarding the

decision. Adverse determinations include decisions not to authorize formulary and nonformulary

medication.

      (2) "Appeal" means a subsequent review of an adverse determination upon request by a

patient or provider to reconsider all or part of the original decision.

      (3) "Authorization" means the review agent's utilization review, performed according to

subsection 23-17.12-2(20), concluded that the allocation of health care services of a provider,

given or proposed to be given to a patient was approved or authorized.

      (4) "Benefit determination" means a decision of the enrollee's entitlement to payment for

covered health care services as defined in an agreement with the payor or its delegate.

      (5) "Certificate" means a certificate of registration granted by the director to a review

agent.

      (6) "Complaint" means a written expression of dissatisfaction by a patient, or provider.

The appeal of an adverse determination is not considered a complaint.

      (7) "Concurrent assessment" means an assessment of the medical necessity and/or

appropriateness of health care services conducted during a patient's hospital stay or course of

treatment. If the medical problem is ongoing, this assessment may include the review of services

after they have been rendered and billed. This review does not mean the elective requests for

clarification of coverage or claims review or a provider's internal quality assurance program

except if it is associated with a health care financing mechanism.

      (8) "Department" means the department of health.

      (9) "Director" means the director of the department of health.

      (10) "Emergent health care services" has the same meaning as that meaning contained in

the rules and regulations promulgated pursuant to chapter 12.3 of title 42 as may be amended

from time to time and includes those resources provided in the event of the sudden onset of a

medical, mental health, or substance abuse or other health care condition manifesting itself by

acute symptoms of a severity (e.g. severe pain) where the absence of immediate medical attention

could reasonably be expected to result in placing the patient's health in serious jeopardy, serious

impairment to bodily or mental functions, or serious dysfunction of any body organ or part.

      (11) "Patient" means an enrollee or participant in all hospital or medical plans seeking

health care services and treatment from a provider.

      (12) "Payor" means a health insurer, self-insured plan, nonprofit health service plan,

health insurance service organization, preferred provider organization, health maintenance

organization or other entity authorized to offer health insurance policies or contracts or pay for

LC001455/SUB A/4 - Page 2 of 45

the delivery of health care services or treatment in this state.

      (13) "Practitioner" means any person licensed to provide or otherwise lawfully providing

health care services, including, but not limited to, a physician, dentist, nurse, optometrist,

podiatrist, physical therapist, clinical social worker, or psychologist.

      (14) "Prospective assessment" means an assessment of the medical necessity and/or

appropriateness of health care services prior to services being rendered.

      (15) "Provider" means any health care facility, as defined in § 23-17-2 including any

mental health and/or substance abuse treatment facility, physician, or other licensed practitioners

identified to the review agent as having primary responsibility for the care, treatment, and

services rendered to a patient.

      (16) "Retrospective assessment" means an assessment of the medical necessity and/or

appropriateness of health care services that have been rendered. This shall not include reviews

conducted when the review agency has been obtaining ongoing information.

      (17) "Review agent" means a person or entity or insurer performing utilization review

that is either employed by, affiliated with, under contract with, or acting on behalf of:

      (i) A business entity doing business in this state;

      (ii) A party that provides or administers health care benefits to citizens of this state,

including a health insurer, self-insured plan, non-profit health service plan, health insurance

service organization, preferred provider organization or health maintenance organization

authorized to offer health insurance policies or contracts or pay for the delivery of health care

services or treatment in this state; or

      (iii) A provider.

      (18) "Same or similar specialty" means a practitioner who has the appropriate training

and experience that is the same or similar as the attending provider in addition to experience in

treating the same problems to include any potential complications as those under review.

      (19) "Urgent health care services" has the same meaning as that meaning contained in

the rules and regulations promulgated pursuant to chapter 12.3 of title 42 as may be amended

from time to time and includes those resources necessary to treat a symptomatic medical, mental

health, or substance abuse or other health care condition requiring treatment within a twenty-four

(24) hour period of the onset of such a condition in order that the patient's health status not

decline as a consequence. This does not include those conditions considered to be emergent

health care services as defined in subdivision (10).

      (20) "Utilization review" means the prospective, concurrent, or retrospective assessment

of the necessity and/or appropriateness of the allocation of health care services of a provider,

LC001455/SUB A/4 - Page 3 of 45

given or proposed to be given to a patient. Utilization review does not include:

      (i) Elective requests for the clarification of coverage; or

      (ii) Benefit determination; or

      (iii) Claims review that does not include the assessment of the medical necessity and

appropriateness; or

      (iv) A provider's internal quality assurance program except if it is associated with a

health care financing mechanism; or

      (v) The therapeutic interchange of drugs or devices by a pharmacy operating as part of a

licensed inpatient health care facility; or

      (vi) The assessment by a pharmacist licensed pursuant to the provisions of chapter 19 of

title 5 and practicing in a pharmacy operating as part of a licensed inpatient health care facility in

the interpretation, evaluation and implementation of medical orders, including assessments and/or

comparisons involving formularies and medical orders.

      (21) "Utilization review plan" means a description of the standards governing utilization

review activities performed by a private review agent.

      (22) "Health care services" means and includes an admission, diagnostic procedure,

therapeutic procedure, treatment, extension of stay, the ordering and/or filling of formulary or

nonformulary medications, and any other services, activities, or supplies that are covered by the

patient's benefit plan.

      (23) "Therapeutic interchange" means the interchange or substitution of a drug with a

dissimilar chemical structure within the same therapeutic or pharmacological class that can be

expected to have similar outcomes and similar adverse reaction profiles when given in equivalent

doses, in accordance with protocols approved by the president of the medical staff or medical

director and the director of pharmacy.

     23-17.12-3. General certificate requirements. -- (a) A review agent shall not conduct

utilization review in the state unless the department has granted the review agent a certificate.

      (b) Individuals shall not be required to hold separate certification under this chapter

when acting as either an employee of, an affiliate of, a contractor for, or otherwise acting on

behalf of a certified review agent.

      (c) The department shall issue a certificate to an applicant that has met the minimum

standards established by this chapter, and regulations promulgated in accordance with it,

including the payment of any fees as required, and other applicable regulations of the department.

      (d) A certificate issued under this chapter is not transferable, and the transfer of fifty

percent (50%) or more of the ownership of a review agent shall be deemed a transfer.

LC001455/SUB A/4 - Page 4 of 45

      (e) After consultation with the payors and providers of health care, the department shall

adopt regulations necessary to implement the provisions of this chapter.

      (f) The director of health is authorized to establish any fees for initial application,

renewal applications, and any other administrative actions deemed necessary by the director to

implement this chapter.

      (g) The total cost of certification under this title shall be borne by the certified entities

and shall be one hundred and fifty percent (150%) of the total salaries paid to the certifying

personnel of the department engaged in those certifications less any salary reimbursements and

shall be paid to the director to and for the use of the department. That assessment shall be in

addition to any taxes and fees otherwise payable to the state.

      (h) The application and other fees required under this chapter shall be sufficient to pay

for the administrative costs of the certificate program and any other reasonable costs associated

with carrying out the provisions of this chapter.

      (i) A certificate expires on the second anniversary of its effective date unless the

certificate is renewed for a two (2) year term as provided in this chapter.

      (j) Any systemic changes in the review agents operations relative to certification

information on file shall be submitted to the department for approval within thirty (30) days prior

to implementation.

     23-17.12-4. Application process. -- (a) An applicant requesting certification or

recertification shall:

      (1) Submit an application provided by the director; and

      (2) Pay the application fee established by the director through regulation and § 23-17.12-

3(f).

      (b) The application shall:

      (1) Be on a form and accompanied by supporting documentation that the director

requires; and

      (2) Be signed and verified by the applicant.

      (c) Before the certificate expires, a certificate may be renewed for an additional two (2)

years.

      (d) If a completed application for recertification is being processed by the department, a

certificate may be continued until a renewal determination is made.

      (e) In conjunction with the application, the review agent shall submit information that

the director requires including:

      (1) A request that the state agency regard specific portions of the standards and criteria

LC001455/SUB A/4 - Page 5 of 45

or the entire document to constitute "trade secrets" within the meaning of that term in § 38-2-

2(4)(i)(B);

      (2) The policies and procedures to ensure that all applicable state and federal laws to

protect the confidentiality of individual medical records are followed;

      (3) A copy of the materials used to inform enrollees of the requirements under the health

benefit plan for seeking utilization review or pre-certification and their rights under this chapter,

including information on appealing adverse determinations;

      (4) A copy of the materials designed to inform applicable patients and providers of the

requirements of the utilization review plan;

      (5) A list of the third party payors and business entities for which the review agent is

performing utilization review in this state and a brief description of the services it is providing for

each client; and

      (6) Evidence of liability insurance or of assets sufficient to cover potential liability.

      (f) The information provided must demonstrate that the review agent will comply with

the regulations adopted by the director under this chapter.

     23-17.12-5. General application requirements. -- An application for certification or

recertification shall be accompanied by documentation to evidence the following:

      (1) The requirement that the review agent provide patients and providers with a summary

of its utilization review plan including a summary of the standards, procedures and methods to be

used in evaluating proposed or delivered health care services;

      (2) The circumstances, if any, under which utilization review may be delegated to any

other utilization review program and evidence that the delegated agency is a certified utilization

review agency delegated to perform utilization review pursuant to all of the requirements of this

chapter;

      (3) A complaint resolution process consistent with subsection 23-17.12-2(6) and

acceptable to the department, whereby patients, their physicians, or other health care providers

may seek resolution of complaints and other matters of which the review agent has received

written notice;

      (4) The type and qualifications of personnel (employed or under contract) authorized to

perform utilization review, including a requirement that only a practitioner with the same license

status as the ordering practitioner, or a licensed physician or dentist, is permitted to make a

prospective or concurrent adverse determination;

      (5) The requirement that a representative of the review agent is reasonably accessible to

patients, patient's family and providers at least five (5) days a week during normal business in

LC001455/SUB A/4 - Page 6 of 45

Rhode Island and during the hours of the agency's review operations;

      (6) The policies and procedures to ensure that all applicable state and federal laws to

protect the confidentiality of individual medical records are followed;

      (7) The policies and procedures regarding the notification and conduct of patient

interviews by the review agent;

      (8) The requirement that no employee of, or other individual rendering an adverse

determination for, a review agent may receive any financial incentives based upon the number of

denials of certification made by that employee or individual;

      (9) The requirement that the utilization review agent shall not impede the provision of

health care services for treatment and/or hospitalization or other use of a provider's services or

facilities for any patient;

      (10) Evidence that the review agent has not entered into a compensation agreement or

contract with its employees or agents whereby the compensation of its employees or its agents is

based upon a reduction of services or the charges for those services, the reduction of length of

stay, or utilization of alternative treatment settings; provided, nothing in this chapter shall prohibit

agreements and similar arrangements; and

      (11) An adverse determination and internal appeals process consistent with § 23-17.12-9

and acceptable to the department, whereby patients, their physicians, or other health care

providers may seek prompt reconsideration or appeal of adverse determinations by the review

agent.

     23-17.12-6. Denial, suspension, or revocation of certificate. -- (a) The department may

deny a certificate upon review of the application if, upon review of the application, it finds that

the applicant proposing to conduct utilization review does not meet the standards required by this

chapter or by any regulations promulgated pursuant to this chapter.

      (b) The department may revoke a certificate and/or impose reasonable monetary

penalties not to exceed five thousand dollars ($5,000) per violation in any case in which:

      (1) The review agent fails to comply substantially with the requirements of this chapter

or of regulations adopted pursuant to this chapter;

      (2) The review agent fails to comply with the criteria used by it in its application for a

certificate; or

      (3) The review agent refuses to permit examination by the director to determine

compliance with the requirements of this chapter and regulations promulgated pursuant to the

authority granted to the director in this chapter; provided, however, that the examination shall be

subject to the confidentiality and "need to know" provisions of subdivisions 23-17.12-9(c)(4) and

LC001455/SUB A/4 - Page 7 of 45

(5). These determinations may involve consideration of any written grievances filed with the

department against the review agent by patients or providers.

      (c) Any applicant or certificate holder aggrieved by an order or a decision of the

department made under this chapter without a hearing may, within thirty (30) days after notice of

the order or decision, make a written request to the department for a hearing on the order or

decision pursuant to § 42-35-15.

      (d) The procedure governing hearings authorized by this section shall be in accordance

with §§ 42-35-9 -- 42-35-13 as stipulated in § 42-35-14(a). A full and complete record shall be

kept of all proceedings, and all testimony shall be recorded but need not be transcribed unless the

decision is appealed pursuant to § 42-35-15. A copy or copies of the transcript may be obtained

by any interested party upon payment of the cost of preparing the copy or copies. Witnesses may

be subpoenaed by either party.

     23-17.12-7. Judicial review. -- Any person who has exhausted all administrative

remedies available to him or her within the department, and who is aggrieved by a final decision

of the department under § 23-17.12-6, is entitled to judicial review pursuant to §§ 42-35-15 and

42-35-16.

     23-17.12-8. Waiver of requirements. -- (a) Except for utilization review agencies

performing utilization review activities to determine the necessity and/or appropriateness of

substance abuse and mental health care, treatment or services, the department shall waive all the

requirements of this chapter, with the exception of those contained in §§ 23-17.12-9, (a)(1)-(3),

(5), (6), (8), (b)(1)-(6), and (c)(2)-(6), 23-17.12-12, and 23-17.12-14, for a review agent that has

received, maintains and provides evidence to the department of accreditation from the utilization

review accreditation commission (URAC) or other organization approved by the director. The

waiver shall be applicable only to those services that are included under the accreditation by the

utilization review accreditation commission or other approved organization.

      (b) The department shall waive the requirements of this chapter only when a direct

conflict exists with those activities of a review agent that are conducted pursuant to contracts with

the state or the federal government or those activities under other state or federal jurisdictions.

      (c) The limitation in subsection 23-17.12-8(b) notwithstanding, the department may

waive or exempt all or part of the requirements of this chapter by mutual written agreement with

a state department or agency when such waiver or exemption is determined to be necessary and

appropriate to the administration of a health care related program. The department shall

promulgate such regulations as deemed appropriate to implement this provision.

     23-17.12-8.1. Variance of statutory requirements. [Repealed effective July 1, 2015.] -

LC001455/SUB A/4 - Page 8 of 45

- (a) The department is authorized to issue a statutory variance from one or more of the specific

requirements of this chapter to a review agent where it determines that such variance is necessary

to permit the review agent to evaluate and address practitioner billing and practice patterns when

the review agent believes in good faith that such patterns evidence the existence of fraud or

abuse. Any variance issued by the department pursuant to this section shall be limited in

application to those services billed directly by the practitioner. Prior to issuing a statutory

variance the department shall provide notice and a public hearing to ensure necessary patient and

health care provider protections in the process. Statutory variances shall be issued for a period not

to exceed one year and may be subject to such terms and conditions deemed necessary by the

department.

      (b) On or before January 15th of each year, the department shall issue a report to the

general assembly summarizing any review agent activity as a result of a waiver granted under the

provisions of this section.

     23-17.12-9. Review agency requirement for adverse determination and internal

appeals. -- (a) The adverse determination and appeals process of the review agent shall conform

to the following:

      (1) Notification of a prospective adverse determination by the review agent shall be

mailed or otherwise communicated to the provider of record and to the patient or other

appropriate individual as follows:

      (i) Within fifteen (15) business days of receipt of all the information necessary to

complete a review of non-urgent and/or non-emergent services;

      (ii) Within seventy-two (72) hours of receipt of all the information necessary to complete

a review of urgent and/or emergent services; and

      (iii) Prior to the expected date of service.

      (2) Notification of a concurrent adverse determination shall be mailed or otherwise

communicated to the patient and to the provider of record period as follows:

      (i) To the provider(s) prior to the end of the current certified period; and

      (ii) To the patient within one business day of making the adverse determination.

      (3) Notification of a retrospective adverse determination shall be mailed or otherwise

communicated to the patient and to the provider of record within thirty (30) business days of

receipt of a request for payment with all supporting documentation for the covered benefit being

reviewed.

      (4) A utilization review agency shall not retrospectively deny authorization for health

care services provided to a covered person when an authorization has been obtained for that

LC001455/SUB A/4 - Page 9 of 45

service from the review agent unless the approval was based upon inaccurate information

material to the review or the health care services were not provided consistent with the provider's

submitted plan of care and/or any restrictions included in the prior approval granted by the review

agent.

      (5) Any notice of an adverse determination shall include:

      (i) The principal reasons for the adverse determination, to include explicit documentation

of the criteria not met and/or the clinical rationale utilized by the agency's clinical reviewer in

making the adverse determination. The criteria shall be in accordance with the agency criteria

noted in subsection 23-17.12-9(d) and shall be made available within the first level appeal

timeframe if requested unless otherwise provided as part of the adverse determination notification

process;

      (ii) The procedures to initiate an appeal of the adverse determination, including the name

and telephone number of the person to contract with regard to an appeal;

      (iii) The necessary contact information to complete the two-way direct communication

defined in subdivision 23-17.12-9(a)(7); and

      (iv) The information noted in subdivision 23-27.12-9(a)(5)(i)(ii)(iii) for all verbal

notifications followed by written notification to the patient and provider(s).

      (6) All initial retrospective adverse determinations of a health care service that had been

ordered by a physician, dentist or other practitioner shall be made, documented and signed

consistent with the regulatory requirements which shall be developed by the department with the

input of review agents, providers and other affected parties.

      (7) A level one appeal decision of an adverse determination shall not be made until an

appropriately qualified and licensed review physician, dentist or other practitioner has spoken to,

or otherwise provided for, an equivalent two-way direct communication with the patient's

attending physician, dentist, other practitioner, other designated or qualified professional or

provider responsible for treatment of the patient concerning the medical care, with the exception

of the following:

      (i) When the attending provider is not reasonably available;

      (ii) When the attending provider chooses not to speak with agency staff;

      (iii) When the attending provider has negotiated an agreement with the review agent for

alternative care; and/or

      (iv) When the attending provider requests a peer to peer communication prior to the

adverse determination, the review agency shall then comply with subdivision 23-17.12-9(c)(1) in

responding to such a request. Such requests shall be on the case specific basis unless otherwise

LC001455/SUB A/4 - Page 10 of 45

arranged for in advance by the provider.

      (8) All initial, prospective and concurrent adverse determinations of a health care service

that had been ordered by a physician, dentist or other practitioner shall be made, documented and

signed by a licensed practitioner with the same licensure status as the ordering practitioner or a

licensed physician or dentist. This does not prohibit appropriately qualified review agency staff

from engaging in discussions with the attending provider, the attending provider's designee or

appropriate health care facility and office personnel regarding alternative service and treatment

options. Such a discussion shall not constitute an adverse determination provided though that any

change to the provider's original order and/or any decision for an alternative level of care must be

made and/or appropriately consented to by the attending provider or the provider's designee

responsible for treating the patient.

      (9) The requirement that, upon written request made by or on behalf of a patient, any

adverse determination and/or appeal shall include the written evaluation and findings of the

reviewing physician, dentist or other practitioner. The review agent is required to accept a verbal

request made by or on behalf of a patient for any information where a provider or patient can

demonstrate that a timely response is urgent.

      (b) The review agent shall conform to the following for the appeal of an adverse

determination:

      (1) The review agent shall maintain and make available a written description of the

appeal procedure by which either the patient or the provider of record may seek review of

determinations not to authorize a health care service. The process established by each review

agent may include a reasonable period within which an appeal must be filed to be considered and

that period shall not be less than sixty (60) days.

      (2) The review agent shall notify, in writing, the patient and provider of record of its

decision on the appeal as soon as practical, but in no case later than fifteen (15) or twenty-one

(21) business days if verbal notice is given within fifteen (15) business days after receiving the

required documentation on the appeal.

      (3) The review agent shall also provide for an expedited appeals process for emergency

or life threatening situations. Each review agent shall complete the adjudication of expedited

appeals within two (2) business days of the date the appeal is filed and all information necessary

to complete the appeal is received by the review agent.

      (4) All first level appeals of determinations not to authorize a health care service that had

been ordered by a physician, dentist, or other practitioner shall be made, documented, and signed

by a licensed practitioner with the same licensure status as the ordering practitioner or a licensed

LC001455/SUB A/4 - Page 11 of 45

physician or a licensed dentist.

      (5) All second level appeal decisions shall be made, signed, and documented by a

licensed practitioner in the same or a similar general specialty as typically manages the medical

condition, procedure, or treatment under discussion.

      (6) The review agent shall maintain records of written appeals and their resolution, and

shall provide reports as requested by the department.

      (c) The review agency must conform to the following requirements when making its

adverse determination and appeal decisions:

      (1) The review agent must assure that the licensed practitioner or licensed physician is

reasonably available to review the case as required under subdivision 23-17.12-9(a)(7) and shall

conform to the following:

      (i) Each agency peer reviewer shall have access to and review all necessary information

as requested by the agency and/or submitted by the provider(s) and/or patients;

      (ii) Each agency shall provide accurate peer review contact information to the provider at

the time of service, if requested, and/or prior to such service, if requested. This contact

information must provide a mechanism for direct communication with the agency's peer

reviewer;

      (iii) Agency peer reviewers shall respond to the provider's request for a two-way direct

communication defined in subdivision 23-17.12-9(a)(7)(iv) as follows:

      (A) For a prospective review of non-urgent and non-emergent health care services, a

response within one business day of the request for a peer discussion;

      (B) For concurrent and prospective reviews of urgent and emergent health care services,

a response within a reasonable period of time of the request for a peer discussion; and

      (C) For retrospective reviews, prior to the first level appeal decision.

      (iv) The review agency will have met the requirements of a two-way direct

communication, when requested and/or as required prior to the first level of appeal, when it has

made two (2) reasonable attempts to contact the attending provider directly.

      (v) Repeated violations of this section shall be deemed to be substantial violations

pursuant to § 23-17.12-14 and shall be cause for the imposition of penalties under that section.

      (2) No reviewer at any level under this section shall be compensated or paid a bonus or

incentive based on making or upholding an adverse determination.

      (3) No reviewer under this section who has been involved in prior reviews of the case

under appeal or who has participated in the direct care of the patient may participate as the sole

reviewer in reviewing a case under appeal; provided, however, that when new information has

LC001455/SUB A/4 - Page 12 of 45

been made available at the first level of appeal, then the review may be conducted by the same

reviewer who made the initial adverse determination.

      (4) A review agent is only entitled to review information or data relevant to the

utilization review process. A review agent may not disclose or publish individual medical records

or any confidential medical information obtained in the performance of utilization review

activities. A review agent shall be considered a third party health insurer for the purposes of § 5-

37.3-6(b)(6) of this state and shall be required to maintain the security procedures mandated in §

5-37.3-4(c).

      (5) Notwithstanding any other provision of law, the review agent, the department, and all

other parties privy to information which is the subject of this chapter shall comply with all state

and federal confidentiality laws, including, but not limited to, chapter 37.3 of title 5

(Confidentiality of Health Care Communications and Information Act) and specifically § 5-37.3-

4(c), which requires limitation on the distribution of information which is the subject of this

chapter on a "need to know" basis, and § 40.1-5-26.

      (6) The department may, in response to a complaint that is provided in written form to

the review agent, review an appeal regarding any adverse determination, and may request

information of the review agent, provider or patient regarding the status, outcome or rationale

regarding the decision.

      (d) The requirement that each review agent shall utilize and provide upon request, by

Rhode Island licensed hospitals and the Rhode Island Medical Society, in either electronic or

paper format, written medically acceptable screening criteria and review procedures which are

established and periodically evaluated and updated with appropriate consultation with Rhode

Island licensed physicians, hospitals, including practicing physicians, and other health care

providers in the same specialty as would typically treat the services subject to the criteria as

follows:

      (1) Utilization review agents shall consult with no fewer than five (5) Rhode Island

licensed physicians or other health care providers. Further, in instances where the screening

criteria and review procedures are applicable to inpatients and/or outpatients of hospitals, the

medical director of each licensed hospital in Rhode Island shall also be consulted. Utilization

review agents who utilize screening criteria and review procedures provided by another entity

may satisfy the requirements of this section if the utilization review agent demonstrates to the

satisfaction of the director that the entity furnishing the screening criteria and review procedures

has complied with the requirements of this section.

      (2) Utilization review agents seeking initial certification shall conduct the consultation

LC001455/SUB A/4 - Page 13 of 45

for all screening and review criteria to be utilized. Utilization review agents who have been

certified for one year or longer shall be required to conduct the consultation on a periodic basis

for the utilization review agent's highest volume services subject to utilization review during the

prior year; services subject to the highest volume of adverse determinations during the prior year;

and for any additional services identified by the director.

      (3) Utilization review agents shall not include in the consultations as required under

paragraph (1) of this subdivision, any physicians or other health services providers who have

financial relationships with the utilization review agent other than financial relationships for

provisions of direct patient care to utilization review agent enrollees and reasonable compensation

for consultation as required by paragraph (1) of this subdivision.

      (4) All documentation regarding required consultations, including comments and/or

recommendations provided by the health care providers involved in the review of the screening

criteria, as well as the utilization review agent's action plan or comments on any

recommendations, shall be in writing and shall be furnished to the department on request. The

documentation shall also be provided on request to any licensed health care provider at a nominal

cost that is sufficient to cover the utilization review agent's reasonable costs of copying and

mailing.

      (5) Utilization review agents may utilize non-Rhode Island licensed physicians or other

health care providers to provide the consultation as required under paragraph (1) of this

subdivision, when the utilization review agent can demonstrate to the satisfaction of the director

that the related services are not currently provided in Rhode Island or that another substantial

reason requires such approach.

      (6) Utilization review agents whose annualized data reported to the department

demonstrate that the utilization review agent will review fewer than five hundred (500) such

requests for authorization may request a variance from the requirements of this section.

     23-17.12-10. External appeal requirements. -- (a) In cases where the second level of

appeal to reverse an adverse determination is unsuccessful, the review agent shall provide for an

external appeal by an unrelated and objective appeal agency, selected by the director. The director

shall promulgate rules and regulations including, but not limited to, criteria for designation,

operation, policy, oversight, and termination of designation as an external appeal agency. The

external appeal agency shall not be required to be certified under this chapter for activities

conducted pursuant to its designation.

      (b) The external appeal shall have the following characteristics:

      (1) The external appeal review and decision shall be based on the medical necessity for

LC001455/SUB A/4 - Page 14 of 45

the health care or service and the appropriateness of service delivery for which authorization has

been denied.

      (2) Neutral physicians, dentists, or other practitioners in the same or similar general

specialty as typically manages the health care service shall be utilized to make the external appeal

decisions.

      (3) Neutral physicians, dentists, or other practitioners shall be selected from lists:

      (i) Mutually agreed upon by the provider associations, insurers, and the purchasers of

health services; and

      (ii) Used during a twelve (12) month period as the source of names for neutral physician,

dentist, or other practitioner reviewers.

      (4) The neutral physician, dentist, or other practitioner may confer either directly with

the review agent and provider, or with physicians or dentists appointed to represent them.

      (5) Payment for the appeal fee charged by the neutral physician, dentist, or other

practitioner shall be shared equally between the two (2) parties to the appeal; provided, however,

that if the decision of the utilization review agent is overturned, the appealing party shall be

reimbursed by the utilization review agent for their share of the appeal fee paid under this

subsection.

      (6) The decision of the external appeal agency shall be binding; however, any person

who is aggrieved by a final decision of the external appeal agency is entitled to judicial review in

a court of competent jurisdiction.

     23-17.12-11. Repealed.. --

     23-17.12-12. Reporting requirements. -- (a) The department shall establish reporting

requirements to determine if the utilization review programs are in compliance with the

provisions of this chapter and applicable regulations.

      (b) By November 14, 2014, the department shall report to the general assembly

regarding hospital admission practices and procedures and the effects of such practices and

procedures on the care and wellbeing of patients who present behavioral healthcare conditions on

an emergency basis. The report shall be developed with the cooperation of the department of

behavioral healthcare, developmental disabilities, and hospitals and of the department of children,

youth, and families, and shall recommend changes to state law and regulation to address any

necessary and appropriate revisions to the department's regulations related to utilization review

based on the Federal Mental Health Parity and Addiction Equity Act of 2008 (MHPAEA) and the

Patient Protection and Affordable Care Act, Pub. L. 111-148, and the state's regulatory

interpretation of parity in insurance coverage of behavioral healthcare. These recommended or

LC001455/SUB A/4 - Page 15 of 45

adopted revisions to the department's regulations shall include, but not be limited to:

      (1) Adverse determination and internal appeals, with particular regard to the time

necessary to complete a review of urgent and/or emergent services for patients with behavioral

health needs;

      (2) External appeal requirements;

      (3) The process for investigating whether insurers and agents are complying with the

provisions of chapter 17.12 of title 23 in light of parity in insurance coverage for behavioral

healthcare, with particular regard to emergency admissions; and

      (4) Enforcement of the provisions of chapter 17.12 of title 23 in light of insurance parity

for behavioral healthcare.

     23-17.12-13. Lists. -- The director shall periodically provide a list of private review

agents issued certificates and the renewal date for those certificates to all licensed health care

facilities and any other individual or organization requesting the list.

     23-17.12-14. Penalties. -- A person who substantially violates any provision of this

chapter or any regulation adopted under this chapter or who submits any false information in an

application required by this chapter is guilty of a misdemeanor and on conviction is subject to a

penalty not exceeding five thousand dollars ($5,000).

     23-17.12-15. Annual report. -- The director shall issue an annual report to the governor

and the general assembly concerning the conduct of utilization review in the state. The report

shall include a description of utilization programs and the services they provide, an analysis of

complaints filed against private review agents by patients or providers and an evaluation of the

impact of utilization review programs on patient access to care.

     23-17.12-16. Fees. -- The proceeds of any fees, monetary penalties, and fines collected

pursuant to the provisions of this chapter shall be deposited as general revenues.

      .

     23-17.12-17. Severability. -- If any provision of this chapter or the application of any

provision to any person or circumstance shall be held invalid, that invalidity shall not affect the

provisions or application of this chapter which can be given effect without the invalid provision

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

     SECTION 2. Chapter 23-17.13 of the General Laws entitled "Health Care Accessibility

and Quality Assurance Act" is hereby repealed in its entirety.

CHAPTER 23-17.13

Health Care Accessibility and Quality Assurance Act

     23-17.13-1. Purpose. -- The legislature declares that:

LC001455/SUB A/4 - Page 16 of 45

      (1) It is in the best interest of the public that those individuals and care entities involved

with the delivery of plan coverage in our state meet the standards of this chapter to insure

accessibility and quality for the state's patients;

      (2) Nothing in the legislation is intended to prohibit a health care entity or contractor

from forming limited networks of providers; and

      (3) It is a vital state function to establish these standards for the conduct of health plans

by a health care entity in Rhode Island.

     23-17.13-2. Definitions. -- As used in this chapter:

      (1) "Adverse decision" means any decision by a review agent not to certify an admission,

service, procedure, or extension of stay. A decision by a reviewing agent to certify an admission,

service, or procedure in an alternative treatment setting, or to certify a modified extension of stay,

shall not constitute an adverse decision if the reviewing agent and the requesting provider are in

agreement regarding the decision.

      (2) "Contractor" means a person/entity that:

      (i) Establishes, operates or maintains a network of participating providers;

      (ii) Contracts with an insurance company, a hospital or medical or dental service plan, an

employer, whether under written or self insured, an employee organization, or any other entity

providing coverage for health care services to administer a plan; and/or

      (iii) Conducts or arranges for utilization review activities pursuant to chapter 17.12 of

this title.

      (3) "Direct service ratio" means the amount of premium dollars expended by the plan for

covered services provided to enrollees on a plan's fiscal year basis.

      (4) "Director" means the director of the department of health.

      (5) "Emergency services" has the same meaning as the meaning contained in the rules

and regulations promulgated pursuant to chapter 12.3 of title 42, as may be amended from time to

time, and includes the sudden onset of a medical or mental condition that the absence of

immediate medical attention could reasonably be expected to result in placing the patient's health

in serious jeopardy, serious impairment to bodily or mental functions, or serious dysfunction of

any bodily organ or part.

      (6) "Health care entity" means a licensed insurance company, hospital, or dental or

medical service plan or health maintenance organization, or a contractor as described in

subdivision (2), that operates a health plan.

      (7) "Health care services" includes, but is not limited to, medical, mental health,

substance abuse, and dental services.

LC001455/SUB A/4 - Page 17 of 45

      (8) "Health plan" means a plan operated by a health care entity as described in

subdivision (6) that provides for the delivery of care services to persons enrolled in the plan

through:

      (i) Arrangements with selected providers to furnish health care services; and/or

      (ii) Financial incentives for persons enrolled in the plan to use the participating providers

and procedures provided for by the plan.

      (9) "Provider" means a physician, hospital, pharmacy, laboratory, dentist, or other state

licensed or other state recognized provider of health care services or supplies, and whose services

are recognized pursuant to 213(d) of the Internal Revenue Code, 26 U.S.C. § 213(d), that has

entered into an agreement with a health care entity as described in subdivision (6) or contractor as

described in subdivision (2) to provide these services or supplies to a patient enrolled in a plan.

      (10) "Provider incentive plan" means any compensation arrangement between a health

care entity or plan and a provider or provider group that may directly or indirectly have the effect

of reducing or limiting services provided with respect to an individual enrolled in a plan.

      (11) "Qualified health plan" means a plan that the director of the department of health

certified, upon application by the program, as meeting the requirements of this chapter.

      (12) "Qualified utilization review program" means utilization review program that meets

the requirements of chapter 17.12 of this title.

      (13) "Most favored rate clause" means a provision in a provider contract whereby the

rates or fees to be paid by a health plan are fixed, established or adjusted to be equal to or lower

than the rates or fees paid to the provider by any other health plan or third party payor.

     23-17.13-3. Certification of health plans. -- (a) Certification process.

      (1) Certification.

      (i) The director shall establish a process for certification of health plans meeting the

requirements of certification in subsection (b).

      (ii) The director shall act upon the health plan's completed application for certification

within ninety (90) days of receipt of such application for certification.

      (2) Review and recertification. - To ensure compliance with subsection (b), the director

shall establish procedures for the periodic review and recertification of qualified health plans not

less than every five (5) years; provided, however, that the director may review the certification of

a qualified health plan at any time if there exists evidence that a qualified health plan may be in

violation of subsection (b).

      (3) Cost of certification. - The total cost of obtaining and maintaining certification under

this title and compliance with the requirements of the applicable rules and regulations are borne

LC001455/SUB A/4 - Page 18 of 45

by the entities so certified and shall be one hundred and fifty percent (150%) of the total salaries

paid to the certifying personnel of the department engaged in those certifications less any salary

reimbursements and shall be paid to the director to and for the use of the department. That

assessment shall be in addition to any taxes and fees otherwise payable to the state.

      (4) Standard definitions. - To help ensure a patient's ability to make informed decisions

regarding their health care, the director shall promulgate regulation(s) to provide for standardized

definitions (unless defined in existing statute) of the following terms in this subdivision,

provided, however, that no definition shall be construed to require a health care entity to add any

benefit, to increase the scope of any benefit, or to increase any benefit under any contract:

      (i) Allowable charge;

      (ii) Capitation;

      (iii) Co-payments;

      (iv) Co-insurance;

      (v) Credentialing;

      (vi) Formulary;

      (vii) Grace period;

      (viii) Indemnity insurance;

      (ix) In-patient care;

      (x) Maximum lifetime cap;

      (xi) Medical necessity;

      (xii) Out-of-network;

      (xiii) Out-patient;

      (xiv) Pre-existing conditions;

      (xv) Point of service;

      (xvi) Risk sharing;

      (xvii) Second opinion;

      (xviii) Provider network;

      (xix) Urgent care.

      (b) Requirements for certification. - The director shall establish standards and procedures

for the certification of qualified health plans that conduct business in this state and who have

demonstrated the ability to ensure that health care services will be provided in a manner to assure

availability and accessibility, adequate personnel and facilities, and continuity of service, and has

demonstrated arrangements for ongoing quality assurance programs regarding care processes and

outcomes; other standards shall consist of, but are not limited to, the following:

LC001455/SUB A/4 - Page 19 of 45

      (1) Prospective and current enrollees in health plans must be provided information as to

the terms and conditions of the plan consistent with the rules and regulations promulgated under

chapter 12.3 of title 42 so that they can make informed decisions about accepting and utilizing the

health care services of the health plan. This must be standardized so that customers can compare

the attributes of the plans, and all information required by this paragraph shall be updated at

intervals determined by the director. Of those items required under this section, the director shall

also determine which items shall be routinely distributed to prospective and current enrollees as

listed in this subsection and which items may be made available upon request. The items to be

disclosed are:

      (i) Coverage provisions, benefits, and any restriction or limitations on health care

services, including but not limited to, any exclusions as follows: by category of service, and if

applicable, by specific service, by technology, procedure, medication, provider or treatment

modality, diagnosis and condition, the latter three (3) of which shall be listed by name.

      (ii) Experimental treatment modalities that are subject to change with the advent of new

technology may be listed solely by the broad category "Experimental Treatments". The

information provided to consumers shall include the plan's telephone number and address where

enrollees may call or write for more information or to register a complaint regarding the plan or

coverage provision.

      (2) Written statement of the enrollee's right to seek a second opinion, and reimbursement

if applicable.

      (3) Written disclosure regarding the appeals process described in § 23-17.12-1 et seq.

and in the rules and regulations for the utilization review of care services, promulgated by the

department of health, the telephone numbers and addresses for the plan's office which handles

complaints as well as for the office which handles the appeals process under § 23-17.12-1 et seq.

and the rules and regulations for the utilization of health.

      (4) Written statement of prospective and current enrollees' right to confidentiality of all

health care record and information in the possession and/or control of the plan, its employees, its

agents and parties with whom a contractual agreement exists to provide utilization review or who

in any way have access to care information. A summary statement of the measures taken by the

plan to ensure confidentiality of an individual's health care records shall be disclosed.

      (5) Written disclosure of the enrollee's right to be free from discrimination by the health

plan and the right to refuse treatment without jeopardizing future treatment.

      (6) Written disclosure of a plan's policy to direct enrollees to particular providers. Any

limitations on reimbursement should the enrollee refuse the referral must be disclosed.

LC001455/SUB A/4 - Page 20 of 45

      (7) A summary of prior authorization or other review requirements including

preauthorization review, concurrent review, post-service review, post-payment review and any

procedure that may lead the patient to be denied coverage for or not be provided a particular

service.

      (8) Any health plan that operates a provider incentive plan shall not enter into any

compensation agreement with any provider of covered services or pharmaceutical manufacturer

pursuant to which specific payment is made directly or indirectly to the provider as an

inducement or incentive to reduce or limit services, to reduce the length of stay or the use of

alternative treatment settings or the use of a particular medication with respect to an individual

patient, provided however, that capitation agreements and similar risk sharing arrangements are

not prohibited.

      (9) Health plans must disclose to prospective and current enrollees the existence of

financial arrangements for capitated or other risk sharing arrangements that exist with providers

in a manner described in paragraphs (i), (ii), and (iii):

      (i) "This health plan utilizes capitated arrangements, with its participating providers, or

contains other similar risk sharing arrangements;

      (ii) This health plan may include a capitated reimbursement arrangement or other similar

risk sharing arrangement, and other financial arrangements with your provider;

      (iii) This health plan is not capitated and does not contain other risk sharing

arrangements."

      (10) Written disclosure of criteria for accessing emergency health care services as well

as a statement of the plan's policies regarding payment for examinations to determine if

emergency health care services are necessary, the emergency care itself, and the necessary

services following emergency treatment or stabilization. The health plan must respond to the

request of the treating provider for post-stabilization treatment by approving or denying it as soon

as possible.

      (11) Explanation of how health plan limitations impact enrollees, including information

on enrollee financial responsibility for payment for co-insurance, co-payment, or other non-

covered, out-of-pocket, or out-of-plan services. This shall include information on deductibles and

benefits limitations including, but not limited to, annual limits and maximum lifetime benefits.

      (12) The terms under which the health plan may be renewed by the plan enrollee,

including any reservation by the plan of any right to increase premiums.

      (13) Summary of criteria used to authorize treatment.

      (14) A schedule of revenues and expenses, including direct service ratios and other

LC001455/SUB A/4 - Page 21 of 45

statistical information which meets the requirements set forth below on a form prescribed by the

director.

      (15) Plan costs of health care services, including but not limited to all of the following:

      (i) Physician services;

      (ii) Hospital services, including both inpatients and outpatient services;

      (iii) Other professional services;

      (iv) Pharmacy services, excluding pharmaceutical products dispensed in a physician's

office;

      (v) Health education;

      (vi) Substance abuse services and mental health services.

      (16) Plan complaint, adverse decision, and prior authorization statistics. This statistical

data shall be updated annually:

      (i) The ratio of the number of complaints received to the total number of covered

persons, reported by category, listed in paragraphs (b)(15)(i) -- (vi);

      (ii) The ratio of the number of adverse decisions issued to the number of complaints

received, reported by category;

      (iii) The ratio of the number of prior authorizations denied to the number of prior

authorizations requested, reported by category;

      (iv) The ratio of the number of successful enrollee appeals to the total number of appeals

filed.

      (17) Plans must demonstrate that:

      (i) They have reasonable access to providers, so that all covered health care services will

be provided. This requirement cannot be waived and must be met in all areas where the health

plan has enrollees;

      (ii) Urgent health care services, if covered, shall be available within a time frame that

meets standards set by the director.

      (18) A comprehensive list of participating providers listed by office location, specialty if

applicable, and other information as determined by the director, updated annually.

      (19) Plans must provide to the director, at intervals determined by the director, enrollee

satisfaction measures. The director is authorized to specify reasonable requirements for these

measures consistent with industry standards to assure an acceptable degree of statistical validity

and comparability of satisfaction measures over time and among plans. The director shall publish

periodic reports for the public providing information on health plan enrollee satisfaction.

      (c) Issuance of certification.

LC001455/SUB A/4 - Page 22 of 45

      (1) Upon receipt of an application for certification, the director shall notify and afford

the public an opportunity to comment upon the application.

      (2) A health care plan will meet the requirements of certification, subsection (b) by

providing information required in subsection (b) to any state or federal agency in conformance

with any other applicable state or federal law, or in conformity with standards adopted by an

accrediting organization provided that the director determines that the information is substantially

similar to the previously mentioned requirements and is presented in a format that provides a

meaningful comparison between health plans.

      (3) All health plans shall be required to establish a mechanism, under which providers,

including local providers participating in the plan, provide input into the plan's health care policy,

including technology, medications and procedures, utilization review criteria and procedures,

quality and credentialing criteria, and medical management procedures.

      (4) All health plans shall be required to establish a mechanism under which local

individual subscribers to the plan provide input into the plan's procedures and processes regarding

the delivery of health care services.

      (5) A health plan shall not refuse to contract with or compensate for covered services an

otherwise eligible provider or non-participating provider solely because that provider has in good

faith communicated with one or more of his or her patients regarding the provisions, terms or

requirements of the insurer's products as they relate to the needs of that provider's patients.

      (6) (i) All health plans shall be required to publicly notify providers within the health

plans' geographic service area of the opportunity to apply for credentials. This notification

process shall be required only when the plan contemplates adding additional providers and may

be specific as to geographic area and provider specialty. Any provider not selected by the health

plan may be placed on a waiting list.

      (ii) This credentialing process shall begin upon acceptance of an application from a

provider to the plan for inclusion.

      (iii) Each application shall be reviewed by the plan's credentialing body.

      (iv) All health plans shall develop and maintain credentialing criteria to be utilized in

adding providers from the plans' network. Credentialing criteria shall be based on input from

providers credentialed in the plan and these standards shall be available to applicants. When

economic considerations are part of the decisions, the criteria must be available to applicants.

Any economic profiling must factor the specialty utilization and practice patterns and general

information comparing the applicant to his or her peers in the same specialty will be made

available. Any economic profiling of providers must be adjusted to recognize case mix, severity

LC001455/SUB A/4 - Page 23 of 45

of illness, age of patients and other features of a provider's practice that may account for higher

than or lower than expected costs. Profiles must be made available to those so profiled.

      (7) A health plan shall not exclude a provider of covered services from participation in

its provider network based solely on:

      (i) The provider's degree or license as applicable under state law; or

      (ii) The provider of covered services lack of affiliation with, or admitting privileges at a

hospital, if that lack of affiliation is due solely to the provider's type of license.

      (8) Health plans shall not discriminate against providers solely because the provider

treats a substantial number of patients who require expensive or uncompensated medical care.

      (9) The applicant shall be provided with all reasons used if the application is denied.

      (10) Plans shall not be allowed to include clauses in physician or other provider contracts

that allow for the plan to terminate the contract "without cause"; provided, however, cause shall

include lack of need due to economic considerations.

      (11) (i) There shall be due process for non-institutional providers for all adverse

decisions resulting in a change of privileges of a credentialed non-institutional provider. The

details of the health plan's due process shall be included in the plan's provider contracts.

      (ii) A health plan is deemed to have met the adequate notice and hearing requirement of

this section with respect to a non-institutional provider if the following conditions are met (or are

waived voluntarily by the non-institutional provider):

      (A) The provider shall be notified of the proposed actions and the reasons for the

proposed action.

      (B) The provider shall be given the opportunity to contest the proposed action.

      (C) The health plan has developed an internal appeals process that has reasonable time

limits for the resolution of an internal appeal.

      (12) If the plan places a provider or provider group at financial risk for services not

provided by the provider or provider group, the plan must require that a provider or group has met

all appropriate standards of the department of business regulation.

      (13) A health plan shall not include a most favored rate clause in a provider contract.

     23-17.13-4. Penalties and enforcement. -- (a) The director of the department of health

may, in lieu of the suspension or revocation of a license, levy an administrative penalty in an

amount not less than five hundred dollars ($500) nor more than fifty thousand dollars ($50,000),

if reasonable notice, in writing, is given of the intent to levy the penalty and the particular health

organization has a reasonable time in which to remedy the defect in its operations which gave rise

to the penalty citation. The director of health may augment this penalty by an amount equal to the

LC001455/SUB A/4 - Page 24 of 45

sum that the director calculates to be the damages suffered by enrollees or other members of the

public.

      (b) Any person who knowingly and willfully violates this chapter shall be guilty of a

misdemeanor and may be punished by a fine not to exceed five hundred dollars ($500) or by

imprisonment for a period not exceeding one year, or both.

      (c) (1) If the director of health shall for any reason have cause to believe that any

violation of this chapter has occurred or is threatened, the director of health may give notice to the

particular health organization and to their representatives, or other persons who appear to be

involved in the suspected violation, to arrange a conference with the alleged violators or their

authorized representatives for the purpose of attempting to ascertain the facts relating to the

suspected violation, and, in the event it appears that any violation has occurred or is threatened, to

arrive at an adequate and effective means of correcting or preventing the violation;

      (2) Proceedings under this subsection shall be governed by chapter 35 of title 42.

      (d) (1) The director of health may issue an order directing a particular health

organization or a representative of that health organization to cease and desist from engaging in

any act or practice in violation of the provisions of this chapter;

      (2) Within thirty (30) days after service of the order to cease and desist, the respondent

may request a hearing on the question of whether acts or practices in violation of this chapter

have occurred. Those hearings shall be conducted pursuant to §§ 42-35-9 through 42-35-13, and

judicial review shall be available as provided by §§ 42-35-15 and 42-35-16.

      (e) In the case of any violation of the provisions of this chapter, if the director of health

elects not to issue a cease and desist order, or in the event of noncompliance with a cease and

desist order issued pursuant to subsection (d), the director of health may institute a proceeding to

obtain injunctive relief, or seeking other appropriate relief, in the superior court for the county of

Providence.

     23-17.13-5. Severability. -- If any section, clause, or provision of this chapter shall be

held either unconstitutional or ineffective in whole or in part to the extent that it is not

unconstitutional or ineffective, it shall be valid and effective and no other section, clause or

provision shall on account thereof be termed invalid or ineffective.

     23-17.13-6. Contracts with providers for dental services. -- (a) No contract between a

dental plan of a health care entity and a dentist for the provision of services to patients may

require that a dentist provide services to its subscribers at a fee set by the health care entity unless

said services are covered services under the applicable subscriber agreement. "Covered services,"

as used herein, means services reimbursable under the applicable subscriber agreement, subject to

LC001455/SUB A/4 - Page 25 of 45

such contractual limitations on subscriber benefits as may apply, including, for example,

deductibles, waiting period or frequency limitations.

      (b) For the purposes of this section "dental plan" shall include any policy of insurance

which is issued by a health care entity which provides for coverage of dental services not in

connection with a medical plan.

     23-17.13-7. Contracts with providers and optometric services. -- (a) No contract

between an eye care provider and a company offering accident and sickness insurance as defined

in chapter 18 of title 27; a nonprofit medical service corporation as defined in chapter 20 of title

27; or a health maintenance organization as defined in chapter 41 of title 27; or a vision plan, may

require that an eye care provider provide services or materials to its subscribers at a fee set by the

insurer or vision plan unless the insurer or vision plan compensates the eye care provider for the

provision of such services or materials to the patient. Reimbursement paid by the insurer or vision

plan for covered services and materials shall not provide nominal reimbursement in order to claim

that services and materials are covered services.

      (b) (1) "Services" means services and materials for which reimbursement from the vision

plan is provided for by an enrollee's plan contract, or for which a reimbursement would be

available but for the application of the enrollee's contractual limitations of deductibles,

copayments, or coinsurance.

      (2) "Materials" means and includes, but is not limited to, lenses, devices containing

lenses, prisms, lens treatments and coatings, contact lenses, orthoptics, vision training, and

prosthetic devices to correct, relieve, or treat defects or abnormal conditions of the human eye or

its adnexa.

      (3) "Eye care provider" means an optometrist, optician, or ophthalmologist.

     SECTION 3. Chapter 23-17.18 of the General Laws entitled "Health Plan Modification

Act" is hereby repealed in its entirety.

CHAPTER 23-17.18

Health Plan Modification Act

     23-17.18-1. Modification of health plans. -- (a) A health plan may materially modify the

terms of a participating agreement it maintains with a physician only if the plan disseminates in

writing by mail to the physician the contents of the proposed modification and an explanation, in

nontechnical terms, of the modification's impact.

      (b) The health plan shall provide the physician an opportunity to amend or terminate the

physician contract with the health plan within sixty (60) days of receipt of the notice of

modification. Any termination of a physician contract made pursuant to this section shall be

LC001455/SUB A/4 - Page 26 of 45

effective fifteen (15) calendar days from the mailing of the notice of termination in writing by

mail to the health plan. The termination shall not affect the method of payment or reduce the

amount of reimbursement to the physician by the health plan for any patient in active treatment

for an acute medical condition at the time the patient's physician terminates his, her, or its

physician contract with the health plan until the active treatment is concluded or, if earlier, one

year after the termination; and, with respect to the patient, during the active treatment period the

physician shall be subject to all the terms and conditions of the terminated physician contract,

including but not limited to, all reimbursement provisions which limit the patient's liability.

      (c) Nothing in this section shall apply to accident-only, specified disease, hospital

indemnity, Medicare supplement, long-term care, disability income, or other limited benefit

health insurance policies.

     SECTION 4. Title 27 of the General Laws entitled "INSURANCE" is hereby amended

by adding thereto the following chapter:

CHAPTER 18.8

HEALTH CARE ACCESSIBILITY AND QUALITY ASSURANCE ACT

     27-18.8-1. Purpose. -- The legislature declares that:

     (1) It is in the best interest of the public that those individuals and care entities involved

with the delivery of plan coverage in our state meet the standards of this chapter to insure

accessibility and quality for the state's patients;

     (2) Nothing in the legislation is intended to prohibit a health care entity or contractor

from forming limited networks of providers; and

     (3) It is a vital state function to establish these standards for the conduct of health plans

by a health care entity in Rhode Island.

     27-18.8-2. Definitions. -- As used in this chapter:

     (1) "Adverse determination" means a utilization review decision by a review agent not to

authorize a health care service. A decision by a review agent to authorize a health care service in

an alternative setting, a modified extension of stay, or an alternative treatment shall not constitute

an adverse determination if the review agent and provider are in agreement regarding the

decision. Adverse determinations include decisions not to authorize formulary and non-formulary

medication.

     (2) "Benefit determination" means a decision of the enrollee's entitlement to payment for

covered health care services as defined in an agreement with the payor or its delegate.

     (3) "Contractor" means a person/entity that:

     (i) Establishes, operates or maintains a network of participating providers;

LC001455/SUB A/4 - Page 27 of 45

     (ii) Contracts with an insurance company, a hospital or medical or dental service plan, an

employer, whether under written or self insured, an employee organization, or any other entity

providing coverage for health care services to administer a plan; and/or

     (iii) Conducts or arranges for utilization review activities pursuant to chapter 17.12 of this

title.

     (4) "Commissioner" means the commissioner of the Office of the Health Insurance

Commissioner.

     (5) "Emergency services" has the same meaning as the meaning contained in the rules

and regulations promulgated pursuant to chapter 12.3 of title 42, as may be amended from time to

time, and includes the sudden onset of a medical or mental condition that the absence of

immediate medical attention could reasonably be expected to result in placing the patient's health

in serious jeopardy, serious impairment to bodily or mental functions, or serious dysfunction of

any bodily organ or part.

     (6) "Health care entity" means a licensed insurance company, hospital, or dental or

medical service plan or health maintenance organization, or a contractor as described in

subsection (3) of this section, that operates a health plan.

     (7) "Health care services" includes, but is not limited to, medical, mental health,

substance abuse, and dental services.

     (8) "Health plan" means a plan operated by a health care entity as described in subsection

(6) of this section that provides for the delivery of care services to persons enrolled in the plan

through:

     (i) Arrangements with selected providers to furnish health care services; and/or

     (ii) Financial incentives for persons enrolled in the plan to use the participating providers

and procedures provided for by the plan.

     (9) "Provider" means a physician, hospital, pharmacy, laboratory, dentist, or other state

licensed or other state recognized provider of health care services or supplies, and whose services

are recognized pursuant to 213(d) of the Internal Revenue Code, 26 U.S.C. § 213(d), that has

entered into an agreement with a health care entity as described in subsection (6) of this section or

contractor as described in subsection (2) to provide these services or supplies to a patient enrolled

in a plan.

     (10) "Most favored rate clause" means a provision in a provider contract whereby the

rates or fees to be paid by a health plan are fixed, established or adjusted to be equal to or lower

than the rates or fees paid to the provider by any other health plan or third party payor.

     27-18.8-3. Certification of health plans. -- (a) Certification process.

LC001455/SUB A/4 - Page 28 of 45

     (1) Certification.

     (i) The commissioner, in consultation with the director of the department of health, shall

establish a process for certification of health plans meeting the requirements of certification in

subsection (b).

     (ii) The commissioner shall act upon the health plan's completed application for

certification within ninety (90) days of receipt of such application for certification.

     (2) Review and recertification. To ensure compliance with subsection (b), the

commissioner shall establish procedures for the periodic review and recertification of health plans

not less than every five (5) years; provided, however, that the commissioner may review the

certification of a health plan at any time if there exists evidence that a health plan may be in

violation of subsection (b).

     (3) Cost of certification. The total cost of obtaining and maintaining certification under

this title and compliance with the requirements of the applicable rules and regulations are borne

by the entities so certified and shall be one hundred and fifty percent (150%) of the total salaries

paid to the certifying personnel of the office engaged in those certifications less any salary

reimbursements and shall be paid to the commissioner to and for the use of the office. That

assessment shall be in addition to any taxes and fees otherwise payable to the state.

     (b) Requirements for certification. The commissioner, in consultation with the director of

the department of health, shall establish standards and procedures for the certification of health

plans that conduct business in this state and who have demonstrated the ability to ensure that

health care services will be provided in a manner to assure availability and accessibility, adequate

personnel and facilities, and continuity of service, and has demonstrated arrangements for

ongoing quality assurance programs regarding care processes and outcomes; other standards shall

consist of, but are not limited to, the following:

     (1) Plans must demonstrate that:

     (i) They have reasonable access to providers, so that all covered health care services will

be provided. This requirement cannot be waived and must be met in all areas where the health

plan has enrollees;

     (ii) Covered health care services shall be available within a time frame that meets

standards set by the commissioner.

     (2) A comprehensive list of participating providers listed by office location, specialty if

applicable, and other information as determined by the commissioner, updated annually.

     (c) Issuance of certification.

     (1) A health care plan shall meet all or some of the requirements of certification, by

LC001455/SUB A/4 - Page 29 of 45

providing the required certification information to any state or federal agency in conformance

with any other applicable state or federal law, or in conformity with standards adopted by an

accrediting organization provided that the commissioner determines that the information is

substantially similar to the previously mentioned requirements.

     (2) All health plans shall be required to establish a mechanism, under which providers,

including local providers participating in the plan, provide input into the plan's health care policy,

including technology, medications and procedures, utilization review criteria and procedures,

quality and credentialing criteria, and medical management procedures.

     (2) All health plans shall be required to establish a mechanism under which local

individual subscribers to the plan provide input into the plan's procedures and processes regarding

the delivery of health care services.

     (3) A health plan shall not refuse to contract with or compensate for covered services an

otherwise eligible provider or non-participating provider solely because that provider has in good

faith communicated with one or more of his or her patients regarding the provisions, terms or

requirements of the insurer's products as they relate to the needs of that provider's patients.

     (4) The health plan provider contracting and credentialing process shall include the

following:

     (i) This credentialing process shall begin upon acceptance of an application from a

provider to the plan for inclusion.

     (ii) Each application shall be reviewed by the plan's credentialing body.

     (iii) All health plans shall develop and maintain credentialing criteria to be utilized in

adding providers from the plans' network. Credentialing criteria shall be based on input from

providers credentialed in the plan and these standards shall be available to applicants. When

economic considerations are part of the decisions, the criteria must be available to applicants.

Any economic profiling must factor the specialty utilization and practice patterns and general

information comparing the applicant to his or her peers in the same specialty will be made

available. Any economic profiling of providers must be adjusted to recognize case mix, severity

of illness, age of patients and other features of a provider's practice that may account for higher

than or lower than expected costs. Profiles must be made available to those so profiled.

     (5) A health plan shall not exclude a provider of covered services from participation in its

provider network based solely on:

     (i) The provider's degree or license as applicable under state law; or

     (ii) The provider of covered services lack of affiliation with, or admitting privileges at a

hospital, if that lack of affiliation is due solely to the provider's type of license.

LC001455/SUB A/4 - Page 30 of 45

     (6) Health plans shall not discriminate against providers solely because the provider treats

a substantial number of patients who require expensive or uncompensated medical care.

     (7) The applicant shall be provided with all reasons used if the application is denied.

     (8) Plans shall not be allowed to include clauses in physician or other provider contracts

that allow for the plan to terminate the contract "without cause"; provided, however, cause shall

include lack of need due to economic considerations.

     (9)(i) There shall be due process for non-institutional providers for all adverse decisions

resulting in a change of privileges of a credentialed non-institutional provider. The details of the

health plan's due process shall be included in the plan's provider contracts.

     (ii) A health plan is deemed to have met the adequate notice and hearing requirement of

this section with respect to a non-institutional provider if the following conditions are met (or are

waived voluntarily by the non-institutional provider):

     (A) The provider shall be notified of the proposed actions and the reasons for the

proposed action.

     (B) The provider shall be given the opportunity to contest the proposed action.

     (C) The health plan has developed an internal appeals process that has reasonable time

limits for the resolution of an internal appeal.

     (10) A health plan shall not include a most favored rate clause in a provider contract.

     (11) A health plan may materially modify the terms of a participating agreement it

maintains with a physician only if the plan disseminates in writing by mail to the physician the

contents of the proposed modification and an explanation, in nontechnical terms, of the

modification's impact.

     (12) The health plan shall provide the physician an opportunity to amend or terminate the

physician contract with the health plan within sixty (60) days of receipt of the notice of

modification. Any termination of a physician contract made pursuant to this section shall be

effective fifteen (15) calendar days from the mailing of the notice of termination in writing by

mail to the health plan. The termination shall not affect the method of payment or reduce the

amount of reimbursement to the physician by the health plan for any patient in active treatment

for an acute medical condition at the time the patient's physician terminates his, her, or its

physician contract with the health plan until the active treatment is concluded or, if earlier, one

year after the termination; and, with respect to the patient, during the active treatment period the

physician shall be subject to all the terms and conditions of the terminated physician contract,

including but not limited to, all reimbursement provisions which limit the patient's liability.

     27-18.8-4. Contracts with providers for dental services. -- (a) No contract between a

LC001455/SUB A/4 - Page 31 of 45

dental plan of a health care entity and a dentist for the provision of services to patients may

require that a dentist provide services to its subscribers at a fee set by the health care entity unless

said services are covered services under the applicable subscriber agreement. "Covered services,"

as used herein, means services reimbursable under the applicable subscriber agreement, subject to

such contractual limitations on subscriber benefits as may apply, including, for example,

deductibles, waiting period or frequency limitations.

     (b) For the purposes of this section "dental plan" shall include any policy of insurance

which is issued by a health care entity which provides for coverage of dental services not in

connection with a medical plan.

     27-18.8-5. Contracts with providers and optometric services. -- (a) No contract

between an eye care provider and a company offering accident and sickness insurance as defined

in chapter 18 of title 27; a nonprofit medical service corporation as defined in chapter 20 of title

27; or a health maintenance organization as defined in chapter 41 of title 27; or a vision plan, may

require that an eye care provider provide services or materials to its subscribers at a fee set by the

insurer or vision plan unless the insurer or vision plan compensates the eye care provider for the

provision of such services or materials to the patient. Reimbursement paid by the insurer or vision

plan for covered services and materials shall not provide nominal reimbursement in order to claim

that services and materials are covered services.

     (b)(1) "Services" means services and materials for which reimbursement from the vision

plan is provided for by an enrollee's plan contract, or for which a reimbursement would be

available but for the application of the enrollee's contractual limitations of deductibles,

copayments, or coinsurance.

     (2) "Materials" means and includes, but is not limited to, lenses, devices containing

lenses, prisms, lens treatments and coatings, contact lenses, orthoptics, vision training, and

prosthetic devices to correct, relieve, or treat defects or abnormal conditions of the human eye or

its adnexa.

     (3) "Eye care provider" means an optometrist, optician, or ophthalmologist.

     27-18.8-6. Penalties and enforcement. -- (a) The commissioner may, in lieu of the

suspension or revocation of a license, levy an administrative penalty in an amount not less than

five hundred dollars ($500) nor more than fifty thousand dollars ($50,000), if reasonable notice,

in writing, is given of the intent to levy the penalty and the particular health organization has a

reasonable time in which to remedy the defect in its operations which gave rise to the penalty

citation. The commissioner may augment this penalty by an amount equal to the sum that the

commissioner calculates to be the damages suffered by enrollees or other members of the public.

LC001455/SUB A/4 - Page 32 of 45

     (b) Any person who knowingly and willfully violates this chapter shall be guilty of a

misdemeanor and may be punished by a fine not to exceed five hundred dollars ($500) or by

imprisonment for a period not exceeding one year, or both.

     (c)(1) If the commissioner shall for any reason have cause to believe that any violation of

this chapter has occurred or is threatened, the commissioner may give notice to the particular

health organization and to their representatives, or other persons who appear to be involved in the

suspected violation, to arrange a conference with the alleged violators or their authorized

representatives for the purpose of attempting to ascertain the facts relating to the suspected

violation, and, in the event it appears that any violation has occurred or is threatened, to arrive at

an adequate and effective means of correcting or preventing the violation;

     (2) Proceedings under this subsection shall be governed by chapter 35 of title 42.

     (d)(1) The commissioner may issue an order directing a particular health organization or

a representative of that health organization to cease and desist from engaging in any act or

practice in violation of the provisions of this chapter;

     (2) Within thirty (30) days after service of the order to cease and desist, the respondent

may request a hearing on the question of whether acts or practices in violation of this chapter

have occurred. Those hearings shall be conducted pursuant to §§ 42-35-9 through 42-35-13, and

judicial review shall be available as provided by §§ 42-35-15 and 42-35-16.

     (e) In the case of any violation of the provisions of this chapter, if the commissioner

elects not to issue a cease and desist order, or in the event of noncompliance with a cease and

desist order issued pursuant to subsection (d) of this section, the commissioner may institute a

proceeding to obtain injunctive relief, or seeking other appropriate relief, in the superior court for

the county of Providence.

     27-18.8-7. Severability. -- If any section, clause, or provision of this chapter shall be

held either unconstitutional or ineffective in whole or in part to the extent that it is not

unconstitutional or ineffective, it shall be valid and effective and no other section, clause or

provision shall on account thereof be termed invalid or ineffective.

     SECTION 5. Title 27 of the General Laws entitled "INSURANCE" is hereby amended

by adding thereto the following chapter:

CHAPTER 18.9

HEALTH CARE SERVICES -- UTILIZATION REVIEW ACT

     27-18.9-1. Purpose of chapter. -- The purpose of the chapter is to:

     (1) Promote the delivery of quality health care in a cost effective manner;

     (2) Foster greater coordination between health care providers, patients, payors and

LC001455/SUB A/4 - Page 33 of 45

utilization review entities;

     (3) Protect patients, businesses, and providers by ensuring that review agents are

qualified to perform utilization review activities and to make informed decisions on the

appropriateness of medical care; and

     (4) Ensure that review agents maintain the confidentiality of medical records in

accordance with applicable state and federal laws.

      (5) Provide for consultation by the department of health to the office of the health

insurance commissioner in furtherance of the purposes of this chapter.

     27-18.9-2. Definitions. -- As used in this chapter, the following terms are defined as

follows:

     (1) "Adverse determination" means a utilization review decision by a review agent not to

authorize a health care service. A decision by a review agent to authorize a health care service in

an alternative setting, a modified extension of stay, or an alternative treatment shall not constitute

an adverse determination if the review agent and provider are in agreement regarding the

decision. Adverse determinations include decisions not to authorize formulary and non-formulary

medication.

     (2) "Appeal" means a subsequent review of an adverse determination upon request by a

patient or provider to reconsider all or part of the original decision.

     (3) "Authorization" means the review agent's utilization review, performed according to §

27-18.9-2(20), concluded that the allocation of health care services of a provider, given or

proposed to be given to a patient was approved or authorized.

     (4) "Benefit determination" means a decision of the enrollee's entitlement to payment for

covered health care services as defined in an agreement with the payor or its delegate.

     (5) "Certificate" means a certificate of registration granted by the commissioner to a

review agent.

     (6) "Complaint" means a written expression of dissatisfaction by a patient, or provider.

The appeal of an adverse determination is not considered a complaint.

     (7) "Concurrent assessment" means an assessment of the medical necessity and/or

appropriateness of health care services conducted during a patient's hospital stay or course of

treatment. If the medical problem is ongoing, this assessment may include the review of services

after they have been rendered and billed.

     (8) "Office" means the office of the health insurance commissioner.

     (9) "Commissioner" means the health insurance commissioner.

     (10) "Emergent health care services" has the same meaning as that meaning contained in

LC001455/SUB A/4 - Page 34 of 45

the rules and regulations promulgated pursuant to chapter 12.3 of title 42 as may be amended

from time to time and includes those resources provided in the event of the sudden onset of a

medical, mental health, or substance abuse or other health care condition manifesting itself by

acute symptoms of a severity (e.g. severe pain) where the absence of immediate medical attention

could reasonably be expected to result in placing the patient's health in serious jeopardy, serious

impairment to bodily or mental functions, or serious dysfunction of any body organ or part.

     (11) "Patient" means an enrollee or participant in all hospital or medical plans seeking

health care services and treatment from a provider.

     (12) "Payor" means a health insurer, self-insured plan, nonprofit health service plan,

health insurance service organization, preferred provider organization, health maintenance

organization or other entity authorized to offer health insurance policies or contracts or pay for

the delivery of health care services or treatment in this state.

     (13) "Practitioner" means any person licensed to provide or otherwise lawfully providing

health care services, including, but not limited to, a physician, dentist, nurse, optometrist,

podiatrist, physical therapist, clinical social worker, or psychologist.

     (14) "Prospective assessment" means an assessment of the medical necessity and/or

appropriateness of health care services prior to services being rendered.

     (15) "Provider" means any health care facility, as defined in § 23-17-2 including any

mental health and/or substance abuse treatment facility, physician, or other licensed practitioners

identified to the review agent as having primary responsibility for the care, treatment, and

services rendered to a patient.

     (16) "Retrospective assessment" means an assessment of the medical necessity and/or

appropriateness of health care services that have been rendered. This shall not include reviews

conducted when the review agency has been obtaining ongoing information.

     (17) "Review agent" means a person or entity or insurer performing utilization review

that is either employed by, affiliated with, under contract with, or acting on behalf of:

     (i) A business entity doing business in this state;

     (ii) A party that provides or administers health care benefits to citizens of this state,

including a health insurer, self-insured plan, non-profit health service plan, health insurance

service organization, preferred provider organization or health maintenance organization

authorized to offer health insurance policies or contracts or pay for the delivery of health care

services or treatment in this state; or

     (iii) A provider not involved in the care of the patient.

     (18) "Same or similar specialty" means a practitioner who has the appropriate training

LC001455/SUB A/4 - Page 35 of 45

and experience that is the same or similar as the attending provider in addition to experience in

treating the same problems to include any potential complications as those under review.

     (19) "Urgent health care services" has the same meaning as that meaning contained in the

rules and regulations promulgated pursuant to chapter 12.3 of title 42 as may be amended from

time to time and includes those resources necessary to treat a symptomatic medical, mental

health, or substance abuse or other health care condition requiring treatment within a twenty-four

(24) hour period of the onset of such a condition in order that the patient's health status not

decline as a consequence. This does not include those conditions considered to be emergent

health care services as defined in subsection (10).

     (20) "Utilization review" means the prospective, concurrent, or retrospective assessment

of the necessity and/or appropriateness of the allocation of health care services of a provider,

given or proposed to be given to a patient. Utilization review does not include:

     (i) Elective requests for the clarification of coverage; or

     (ii) Benefit determination; or

     (iii) Claims review that does not include the assessment of the medical necessity and

appropriateness; or

     (iv) A provider's internal quality assurance program except if it is associated with a health

care financing mechanism; or

     (v) The therapeutic interchange of drugs or devices by a pharmacy operating as part of a

licensed inpatient health care facility; or

     (vi) The assessment by a pharmacist licensed pursuant to the provisions of chapter 19 of

title 5 and practicing in a pharmacy operating as part of a licensed inpatient health care facility in

the interpretation, evaluation and implementation of medical orders, including assessments and/or

comparisons involving formularies and medical orders.

     (21) "Utilization review plan" means a description of the standards governing utilization

review activities performed by a private review agent.

     (22) "Health care services" means and includes an admission, diagnostic procedure,

therapeutic procedure, treatment, extension of stay, the ordering and/or filling of formulary or

non-formulary medications, and any other services, activities, or supplies that are covered by the

patient's benefit plan.

     (23) "Therapeutic interchange" means the interchange or substitution of a drug with a

dissimilar chemical structure within the same therapeutic or pharmacological class that can be

expected to have similar outcomes and similar adverse reaction profiles when given in equivalent

doses, in accordance with protocols approved by the president of the medical staff or medical

LC001455/SUB A/4 - Page 36 of 45

director and the director of pharmacy.

     27-18.9-3. General requirements. -- (a) A review agent shall not conduct utilization

review in the state unless the office has granted the review agent a certificate.

     (b) Individuals shall not be required to hold separate certification under this chapter when

acting as either an employee of, an affiliate of, a contractor for, or otherwise acting on behalf of a

certified review agent.

     (c) The office shall issue a certificate to an applicant that has met the minimum standards

established by this chapter, and regulations promulgated in accordance with it, including the

payment of any fees as required, and other applicable regulations of the office.

     (d) A certificate issued under this chapter is not transferable, and the transfer of fifty

percent (50%) or more of the ownership of a review agent shall be deemed a transfer.

     (e) After consultation with the payors and providers of health care, the office shall adopt

regulations necessary to implement the provisions of this chapter.

     (f) The commissioner is authorized to establish any fees for initial application, renewal

applications, and any other administrative actions deemed necessary by the commissioner to

implement this chapter.

     (g) The total cost of certification under this title shall be borne by the certified entities

and shall be one hundred fifty percent (150%) of the total salaries paid to the certifying personnel

of the office engaged in those certifications less any salary reimbursements and shall be paid to

the commissioner to and for the use of the office. That assessment shall be in addition to any

taxes and fees otherwise payable to the state, and shall be paid to the commissioner to and for the

use of the office.

     (h) The application and other fees required under this chapter shall be sufficient to pay

for the administrative costs of the certificate program and any other reasonable costs associated

with carrying out the provisions of this chapter.

     (i) A certificate expires on the third anniversary of its effective date unless the certificate

is renewed for a three (3) year term as provided in this chapter.

     (j) Any systemic changes in the review agents operations relative to certification

information on file shall be submitted to the office for approval within thirty (30) days prior to

implementation. For purposes of this chapter, systemic changes are further defined in regulation.

     27-18.9-4. General application requirements. -- An application for certification or

recertification shall be accompanied by documentation to evidence the following:

     (1) The requirement that the review agent provide patients and providers with a summary

of its utilization review plan including a summary of the standards, procedures and methods to be

LC001455/SUB A/4 - Page 37 of 45

used in evaluating proposed or delivered health care services;

     (2) The circumstances, if any, under which utilization review may be delegated to any

other utilization review program and evidence that the delegated agency is a certified utilization

review agency delegated to perform utilization review pursuant to all of the requirements of this

chapter;

     (3) A complaint resolution process consistent with § 27-81-2(6) and acceptable to the

office, whereby patients, their physicians, or other health care providers may seek resolution of

complaints and other matters of which the review agent has received written notice;

     (4) The type and qualifications of personnel (employed or under contract) authorized to

perform utilization review, including a requirement that only a practitioner with the same license

status as the ordering practitioner, or a licensed physician or dentist, is permitted to make a

prospective or concurrent adverse determination;

     (5) The requirement that a representative of the review agent is reasonably accessible to

patients, patient's family and providers at least five (5) days a week during normal business in

Rhode Island and during the hours of the agency's review operations;

     (6) The policies and procedures to ensure that all applicable state and federal laws to

protect the confidentiality of individual medical records are followed;

     (7) The policies and procedures regarding the notification and conduct of patient

interviews by the review agent;

     (8) The requirement that no employee of, or other individual rendering an adverse

determination for, a review agent may receive any financial incentives based upon the number of

denials of certification made by that employee or individual;

     (9) The requirement that the utilization review agent shall not impede the provision of

health care services for treatment and/or hospitalization or other use of a provider's services or

facilities for any patient;

     (10) Evidence that the review agent has not entered into a compensation agreement or

contract with its employees or agents whereby the compensation of its employees or its agents is

based upon a reduction of services or the charges for those services, the reduction of length of

stay, or utilization of alternative treatment settings; provided, nothing in this chapter shall prohibit