HS HCS HB 328 & 88 -- REGULATION OF MANAGED CARE (Harlan)

This substitute makes numerous changes to the managed care
statutes.  In its main provisions, the substitute:

(1)  Requires that a managed care organization be licensed by
the Department of Insurance rather than certified by the
Department of Health;

(2)  Expands application to health carriers provisions relating
to pharmacy services that currently apply to health maintenance
organizations;

(3)  Clarifies that providers will not be required to submit
copies of their income tax returns to a health carrier.  The
health carrier may require a provider to obtain audited
financial statements if the provider receives 10% or more of the
total medical expenditures made by the health carrier;

(4)  Allows direct access to a participating obstetrician,
gynecologist, or obstetrician/gynecologist in the provider
network.  A health carrier is prohibited from imposing
surcharges, additional copayments, or deductibles for accessing
the obstetrician, gynecologist, or obstetrician/gynecologist
unless the same are imposed on other types of health care
services received in the network;

(5)  Specifies that the "prompt pay" provisions of Section
376.383, RSMo, apply after a health carrier receives a claim for
health care services provided in the state.  Current law applies
when a carrier receives a claim from a person entitled to
reimbursement.  The carrier is also required to provide, within
45 days of receiving the claim, a complete description of all
additional information necessary to process the entire claim;

(6)  Allows a person who has filed a claim for reimbursement for
a health care service to file a civil action against a carrier
for violations of the "prompt pay" provisions; class actions are
specifically excluded.  If the court finds a violation, it will
award the plaintiff $50 per day beginning 10 days following the
date interest began to accrue in addition to the claimed
reimbursement and interest;

(7)  Requires health carriers, when processing claims, to permit
providers to file confirmation numbers of authorized services
and claims for reimbursement in the same format, to allow
providers to file claims for reimbursement for a period of at
least one year following the provision of a health care service,
to issue an electronic confirmation within 24 hours of receipt
of an electronically filed claim for reimbursement, and to
accept all medical codes and modifiers specified in the
substitute;

(8)  Requires carriers to accept electronically filed
reimbursement claims starting January 1, 2003.  The Department
of Insurance will promulgate rules regarding the format of the
forms.  A form completed in its entirety constitutes a "clean
claim";

(9)  Requires health carriers to furnish providers with a
current fee schedule for reimbursement amounts of covered
services for which the health carrier is contracted to provide
and prohibits carriers from requesting a refund against a claim
more than 12 months after a carrier has paid the claim, except
in cases of fraud or misrepresentation by the provider;

(10)  Requires health carriers to provide Internet access to a
current provider directory;

(11)  Requires health carriers to inform enrollees of any denial
of health care coverage.  The explanation must be in plain
language that is easy for a layperson to understand;

(12)  Effective July 1, 2002, requires health carriers to issue
each enrollee a card which includes a telephone number for the
plan, prescription drug information, and a brief description of
the enrollee's plan;

(13)  Requires health carriers, upon notification, to provide an
enrollee with the forms and instructions necessary to enroll a
newly born child if an application is required in order to
continue coverage beyond the 31-day period after the child's
birth;

(14)  Prohibits "hold harmless" clauses that require a health
care provider to assume the sole liability of the provision of
health care services.  Any contract between a health care
provider and a health carrier will include a clause which states
that each party will be responsible for its own negligence or
intentional wrongdoing;

(15)  Requires insurers, upon request, to provide both parents
of a covered child with coverage information regardless of
whether the parent is the primary policyholder;

(16)  Adds prescription medication to the definition of the term
"health care service" and modifies the definition of the term
"certification" to include a determination that the health care
service is a covered benefit under the plan;

(17)  Requires health carriers to notify the dispensing
pharmacy, prescribing physician, and enrollee when a
nonformulary drug is authorized with conditions;

(18)  Allows a health carrier to retract a prior certification
of a health care service if the enrollee's coverage under the
plan has exceeded the enrollee's lifetime or annual benefits
limit;

(19)  Requires a health carrier to provide a certification
decision for emergency services within 45 minutes instead of 60
minutes;

(20)  After January 1, 2004, requires health carriers to use
standardized forms for referrals and explanations of benefits.
These provisions are preempted if the federal government
develops standardized forms;

(21)  Requires the Department of Insurance to adopt any
standardized forms for referrals and explanations of benefits
that are adopted by the federal Health Care Financing
Administration for that purpose;

(22)  Requires health carriers to make available formulary
information to participating pharmacies via the Internet or
other electronic means after January 1, 2004;

(23)  Requires all managed care organizations to allow enrollees
the right to select long-term care facilities which have the
same religious orientation as the enrollee.  If a religiously
appropriate facility is not in the managed care organization's
provider network, it will provide the enrollee the option to
receive care from an out-of-network, long-term care facility
that meets specific qualifications; and

(24)  Repeals 2 sections prescribing standardized forms for
explanation of benefits and referrals.

FISCAL NOTE:  Estimated Net Cost to All Funds is Unknown for FY
2002, FY 2003, and FY 2004.  Costs are expected to exceed
$100,000 annually.

Missouri House of Representatives
Last Updated November 26, 2001 at 11:43 am