2016 -- S 2828 SUBSTITUTE A AS AMENDED

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LC005469/SUB A/2

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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2016

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A N   A C T

RELATING TO STATE AFFAIRS AND GOVERNMENT - HEALTH INSURANCE

OVERSIGHT

     

     Introduced By: Senator Gayle L. Goldin

     Date Introduced: March 23, 2016

     Referred To: Senate Health & Human Services

     (by request)

It is enacted by the General Assembly as follows:

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     SECTION 1. Section 42-14.5-3 of the General Laws in Chapter 42-14.5 entitled "The

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Rhode Island Health Care Reform Act of 2004 - Health Insurance Oversight" is hereby amended

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to read as follows:

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     42-14.5-3. Powers and duties [Contingent effective date; see effective dates under

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this section.] -- The health insurance commissioner shall have the following powers and duties:

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      (a) To conduct quarterly public meetings throughout the state, separate and distinct from

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rate hearings pursuant to § 42-62-13, regarding the rates, services, and operations of insurers

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licensed to provide health insurance in the state, the effects of such rates, services, and operations

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on consumers, medical care providers, patients, and the market environment in which such

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insurers operate, and efforts to bring new health insurers into the Rhode Island market. Notice of

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not less than ten (10) days of said hearing(s) shall go to the general assembly, the governor, the

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Rhode Island Medical Society, the Hospital Association of Rhode Island, the director of health,

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the attorney general and the chambers of commerce. Public notice shall be posted on the

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department's web site and given in the newspaper of general circulation, and to any entity in

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writing requesting notice.

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      (b) To make recommendations to the governor and the house of representatives and

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senate finance committees regarding health care insurance and the regulations, rates, services,

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administrative expenses, reserve requirements, and operations of insurers providing health

 

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insurance in the state, and to prepare or comment on, upon the request of the governor or

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chairpersons of the house or senate finance committees, draft legislation to improve the regulation

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of health insurance. In making such recommendations, the commissioner shall recognize that it is

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the intent of the legislature that the maximum disclosure be provided regarding the

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reasonableness of individual administrative expenditures as well as total administrative costs. The

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commissioner shall make recommendations on the levels of reserves including consideration of:

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targeted reserve levels; trends in the increase or decrease of reserve levels; and insurer plans for

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distributing excess reserves.

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      (c) To establish a consumer/business/labor/medical advisory council to obtain

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information and present concerns of consumers, business, and medical providers affected by

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health insurance decisions. The council shall develop proposals to allow the market for small

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business health insurance to be affordable and fairer. The council shall be involved in the

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planning and conduct of the quarterly public meetings in accordance with subsection (a) above.

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The advisory council shall develop measures to inform small businesses of an insurance

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complaint process to ensure that small businesses that experience rate increases in a given year

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may request and receive a formal review by the department. The advisory council shall assess

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views of the health provider community relative to insurance rates of reimbursement, billing, and

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reimbursement procedures, and the insurers' role in promoting efficient and high-quality health

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care. The advisory council shall issue an annual report of findings and recommendations to the

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governor and the general assembly and present its findings at hearings before the house and

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senate finance committees. The advisory council is to be diverse in interests and shall include

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representatives of community consumer organizations; small businesses, other than those

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involved in the sale of insurance products; and hospital, medical, and other health provider

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organizations. Such representatives shall be nominated by their respective organizations. The

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advisory council shall be co-chaired by the health insurance commissioner and a community

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consumer organization or small business member to be elected by the full advisory council.

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      (d) To establish and provide guidance and assistance to a subcommittee ("the

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professional provider-health plan work group") of the advisory council created pursuant to

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subsection (c) above, composed of health care providers and Rhode Island licensed health plans.

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This subcommittee shall include in its annual report and presentation before the house and senate

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finance committees the following information:

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      (1) A method whereby health plans shall disclose to contracted providers the fee

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schedules used to provide payment to those providers for services rendered to covered patients;

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      (2) A standardized provider application and credentials verification process, for the

 

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purpose of verifying professional qualifications of participating health care providers;

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      (3) The uniform health plan claim form utilized by participating providers;

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      (4) Methods for health maintenance organizations as defined by § 27-41-1, and nonprofit

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hospital or medical service corporations as defined by chapters 19 and 20 of title 27, to make

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facility-specific data and other medical service-specific data available in reasonably consistent

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formats to patients regarding quality and costs. This information would help consumers make

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informed choices regarding the facilities and/or clinicians or physician practices at which to seek

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care. Among the items considered would be the unique health services and other public goods

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provided by facilities and/or clinicians or physician practices in establishing the most appropriate

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cost comparisons;

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      (5) All activities related to contractual disclosure to participating providers of the

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mechanisms for resolving health plan/provider disputes;

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      (6) The uniform process being utilized for confirming, in real time, patient insurance

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enrollment status, benefits coverage, including co-pays and deductibles;

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      (7) Information related to temporary credentialing of providers seeking to participate in

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the plan's network and the impact of said activity on health plan accreditation;

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      (8) The feasibility of regular contract renegotiations between plans and the providers in

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their networks; and

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      (9) Efforts conducted related to reviewing impact of silent PPOs on physician practices.

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      (e) To enforce the provisions of Title 27 and Title 42 as set forth in § 42-14-5(d).

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      (f) To provide analysis of the Rhode Island Affordable Health Plan Reinsurance Fund.

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The fund shall be used to effectuate the provisions of §§ 27-18.5-8 and 27-50-17.

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      (g) To analyze the impact of changing the rating guidelines and/or merging the

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individual health insurance market as defined in chapter 18.5 of title 27 and the small employer

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health insurance market as defined in chapter 50 of title 27 in accordance with the following:

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      (1) The analysis shall forecast the likely rate increases required to effect the changes

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recommended pursuant to the preceding subsection (g) in the direct-pay market and small

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employer health insurance market over the next five (5) years, based on the current rating

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structure and current products.

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      (2) The analysis shall include examining the impact of merging the individual and small

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employer markets on premiums charged to individuals and small employer groups.

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      (3) The analysis shall include examining the impact on rates in each of the individual and

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small employer health insurance markets and the number of insureds in the context of possible

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changes to the rating guidelines used for small employer groups, including: community rating

 

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principles; expanding small employer rate bonds beyond the current range; increasing the

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employer group size in the small group market; and/or adding rating factors for broker and/or

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tobacco use.

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      (4) The analysis shall include examining the adequacy of current statutory and regulatory

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oversight of the rating process and factors employed by the participants in the proposed new

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merged market.

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      (5) The analysis shall include assessment of possible reinsurance mechanisms and/or

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federal high-risk pool structures and funding to support the health insurance market in Rhode

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Island by reducing the risk of adverse selection and the incremental insurance premiums charged

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for this risk, and/or by making health insurance affordable for a selected at-risk population.

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      (6) The health insurance commissioner shall work with an insurance market merger task

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force to assist with the analysis. The task force shall be chaired by the health insurance

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commissioner and shall include, but not be limited to, representatives of the general assembly, the

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business community, small employer carriers as defined in § 27-50-3, carriers offering coverage

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in the individual market in Rhode Island, health insurance brokers, and members of the general

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public.

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      (7) For the purposes of conducting this analysis, the commissioner may contract with an

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outside organization with expertise in fiscal analysis of the private insurance market. In

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conducting its study, the organization shall, to the extent possible, obtain and use actual health

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plan data. Said data shall be subject to state and federal laws and regulations governing

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confidentiality of health care and proprietary information.

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      (8) The task force shall meet as necessary and include its findings in the annual report

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and the commissioner shall include the information in the annual presentation before the house

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and senate finance committees.

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      (h) To establish and convene a workgroup representing health care providers and health

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insurers for the purpose of coordinating the development of processes, guidelines, and standards

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to streamline health care administration that are to be adopted by payors and providers of health

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care services operating in the state. This workgroup shall include representatives with expertise

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who would contribute to the streamlining of health care administration and who are selected from

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hospitals, physician practices, community behavioral health organizations, each health insurer,

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and other affected entities. The workgroup shall also include at least one designee each from the

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Rhode Island Medical Society, Rhode Island Council of Community Mental Health

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Organizations, the Rhode Island Health Center Association, and the Hospital Association of

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Rhode Island. The workgroup shall consider and make recommendations for:

 

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      (1) Establishing a consistent standard for electronic eligibility and coverage verification.

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Such standard shall:

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      (i) Include standards for eligibility inquiry and response and, wherever possible, be

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consistent with the standards adopted by nationally recognized organizations, such as the Centers

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for Medicare and Medicaid Services;

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      (ii) Enable providers and payors to exchange eligibility requests and responses on a

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system-to-system basis or using a payor-supported web browser;

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      (iii) Provide reasonably detailed information on a consumer's eligibility for health care

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coverage; scope of benefits; limitations and exclusions provided under that coverage; cost-sharing

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requirements for specific services at the specific time of the inquiry; current deductible amounts;

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accumulated or limited benefits; out-of-pocket maximums; any maximum policy amounts; and

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other information required for the provider to collect the patient's portion of the bill;

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      (iv) Reflect the necessary limitations imposed on payors by the originator of the

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eligibility and benefits information;

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      (v) Recommend a standard or common process to protect all providers from the costs of

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services to patients who are ineligible for insurance coverage in circumstances where a payor

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provides eligibility verification based on best information available to the payor at the date of the

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request of eligibility.

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      (2) Developing implementation guidelines and promoting adoption of such guidelines

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for:

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      (i) The use of the National Correct Coding Initiative code edit policy by payors and

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providers in the state;

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      (ii) Publishing any variations from codes and mutually exclusive codes by payors in a

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manner that makes for simple retrieval and implementation by providers;

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      (iii) Use of health insurance portability and accountability act standard group codes,

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reason codes, and remark codes by payors in electronic remittances sent to providers;

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      (iv) The processing of corrections to claims by providers and payors.

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      (v) A standard payor-denial review process for providers when they request a

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reconsideration of a denial of a claim that results from differences in clinical edits where no

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single, common-standards body or process exists and multiple conflicting sources are in use by

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payors and providers.

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      (vi) Nothing in this section, or in the guidelines developed, shall inhibit an individual

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payor's ability to employ, and not disclose to providers, temporary code edits for the purpose of

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detecting and deterring fraudulent billing activities. The guidelines shall require that each payor

 

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disclose to the provider its adjudication decision on a claim that was denied or adjusted based on

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the application of such edits and that the provider have access to the payor's review and appeal

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process to challenge the payor's adjudication decision.

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      (vii) Nothing in this subsection shall be construed to modify the rights or obligations of

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payors or providers with respect to procedures relating to the investigation, reporting, appeal, or

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prosecution under applicable law of potentially fraudulent billing activities.

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      (3) Developing and promoting widespread adoption by payors and providers of

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guidelines to:

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      (i) Ensure payors do not automatically deny claims for services when extenuating

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circumstances make it impossible for the provider to obtain a preauthorization before services are

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performed or notify a payor within an appropriate standardized timeline of a patient's admission;

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      (ii) Require payors to use common and consistent processes and time frames when

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responding to provider requests for medical management approvals. Whenever possible, such

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time frames shall be consistent with those established by leading national organizations and be

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based upon the acuity of the patient's need for care or treatment. For the purposes of this section,

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medical management includes prior authorization of services, preauthorization of services,

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precertification of services, post-service review, medical-necessity review, and benefits advisory;

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      (iii) Develop, maintain, and promote widespread adoption of a single, common website

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where providers can obtain payors' preauthorization, benefits advisory, and preadmission

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requirements;

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      (iv) Establish guidelines for payors to develop and maintain a website that providers can

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use to request a preauthorization, including a prospective clinical necessity review; receive an

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authorization number; and transmit an admission notification.

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     (4) To provide a report to the house and senate, on or before January 1, 2017, with

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recommendations for establishing guidelines and regulations for systems that give patients

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electronic access to their claims information, particularly to information regarding their

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obligations to pay for received medical services, pursuant to 45 C.F.R. 164.524.

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      (i) To issue an ANTI-CANCER MEDICATION REPORT. - Not later than June 30,

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2014 and annually thereafter, the office of the health insurance commissioner (OHIC) shall

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provide the senate committee on health and human services, and the house committee on

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corporations, with: (1) Information on the availability in the commercial market of coverage for

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anti-cancer medication options; (2) For the state employee's health benefit plan, the costs of

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various cancer treatment options; (3) The changes in drug prices over the prior thirty-six (36)

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months; and (4) Member utilization and cost-sharing expense.

 

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      (j) To monitor the adequacy of each health plan's compliance with the provisions of the

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federal mental health parity act, including a review of related claims processing and

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reimbursement procedures. Findings, recommendations, and assessments shall be made available

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to the public.

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      (k) To monitor the transition from fee for service and toward global and other alternative

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payment methodologies for the payment for health care services. Alternative payment

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methodologies should be assessed for their likelihood to promote access to affordable health

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insurance, health outcomes, and performance.

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      (l) To report annually, no later than July 1, 2014, then biannually thereafter, on hospital

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payment variation, including findings and recommendations, subject to available resources.

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      (m) Notwithstanding any provision of the general or public laws or regulation to the

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contrary, provide a report with findings and recommendations to the president of the senate and

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the speaker of the house, on or before April 1, 2014, including, but not limited to, the following

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information:

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      (1) The impact of the current mandated healthcare benefits as defined in §§ 27-18-48.1,

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27-18-60, 27-18-62, 27-18-64, similar provisions in chapters 19, 20 and 41, of title 27, and §§ 27-

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18-3(c), 27-38.2-1 et seq., or others as determined by the commissioner, on the cost of health

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insurance for fully insured employers, subject to available resources;

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      (2) Current provider and insurer mandates that are unnecessary and/or duplicative due to

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the existing standards of care and/or delivery of services in the healthcare system;

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      (3) A state-by-state comparison of health insurance mandates and the extent to which

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Rhode Island mandates exceed other states benefits; and

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      (4) Recommendations for amendments to existing mandated benefits based on the

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findings in (1), (2) and (3) above.

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      (n) On or before July 1, 2014, the office of the health insurance commissioner, in

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collaboration with the director of health and lieutenant governor's office, shall submit a report to

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the general assembly and the governor to inform the design of accountable care organizations

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(ACOs) in Rhode Island as unique structures for comprehensive healthcare delivery and value

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based payment arrangements, that shall include, but not be limited to:

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      (1) Utilization review;

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      (2) Contracting; and

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      (3) Licensing and regulation.

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      (o) On or before February 3, 2015, the office of the health insurance commissioner shall

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submit a report to the general assembly and the governor that describes, analyzes, and proposes

 

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recommendations to improve compliance of insurers with the provisions of § 27-18-76 with

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regard to patients with mental health and substance-use disorders.

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     SECTION 2. This act shall take effect upon passage.

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N   A C T

RELATING TO STATE AFFAIRS AND GOVERNMENT - HEALTH INSURANCE

OVERSIGHT

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     This act would empower the health insurance commissioner to establish guidelines for

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payors to develop and maintain a system that gives patients electronic access to their health

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claims information pursuant to federal regulations on or before July 1, 2017.

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     This act would take effect upon passage.

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