HCS SS SCS SB 306 -- HEALTH CARE

SPONSOR:  Dempsey (Ervin)

COMMITTEE ACTION:  Voted "do pass" by the Special Committee on
Health Insurance by a vote of 9 to 5.

This substitute changes the laws regarding health care.

INCOME TAX DEDUCTION FOR HEALTH INSURANCE PREMIUMS (Section
143.111, RSMo)

The substitute removes the deduction for a self-employed,
Missouri resident's individual health insurance premiums from his
or her adjusted gross income when computing his or her Missouri
taxable income.

MISSOURI PATIENT PRIVACY ACT (Section 191.015)

The Missouri Patient Privacy Act is established which prohibits
the disclosure of patient-specific health information to any
employer, public or private payer, or employee or agent of a
state department or agency without the written consent of the
patient and health care provider.  Health information may be
disclosed to a health insurer, employer, state employee or agent
of the Missouri Consolidated Health Care Plan, the Department of
Health and Senior Services, or the MO HealthNet Division within
the Department of Social Services in connection with the
employee's official duties including oversight of state health
problems, tracking infectious diseases, administering state
wellness initiatives and programs, and researching state medical
trends.  The substitute does not prohibit disclosure of personal
health information consistent with federal law and does not
require health care providers to obscure or remove the
information when disclosing it.

EVAN de MELLO REIMBURSEMENT PROGRAM (Section 191.940)

The Evan de Mello Reimbursement Program is established within the
departments of Health and Senior Services and Mental Health to
provide financial assistance for the cost of transportation and
ancillary services associated with the medical treatment of an
eligible child.  The program is the payer of last resort after
all other available sources have been exhausted, and
reimbursement is subject to appropriations.  To be eligible for
assistance under the program, a child must be suffering from a
condition or impairment that results in severe physical illness
or impairments, in need of transportation or ancillary services
due to his or her condition, certified by a physician of the
child's choice as a child who will likely benefit from medical
services, and required to travel at least 100 miles for medical
services which the child's parents or guardian are unable to pay
the travel expenses.

The departments must establish rules which include an application
and review process, a cap on benefits that cannot be less than
$5,000 per recipient, and a household income eligibility limit
which cannot exceed 350% of the federal poverty level.

TRANSPARENCY OF HEALTH CARE INFORMATION (Sections 191.1005,
191.1008, and 191.1010)

Insurers with programs that publicly assess and compare the
quality and cost efficiency of health care providers must conform
to specified criteria for the transparency of health care
information.

Any person who sells or distributes comparative health care
quality and cost-efficiency data for public disclosure must
identify the measuring technique used to validate and analyze the
data, except for articles or research studies published in
peer-reviewed academic journals that do not receive funding from
a health care insurer or state or local government.  Individuals
violating this provision will be investigated by the Department
of Health and Senior Services and may be subject to a penalty of
up to $1,000.  Health insurers violating this provision will be
investigated by the Department of Insurance, Financial
Institutions and Professional Registration and subject to the
department's enforcement powers of the state's insurance laws.

PREMATURE INFANTS (Sections 191.1127 and 191.1130)

The substitute requires the MO HealthNet Program and the Health
Care for Uninsured Children Program, in consultation with
statewide organizations, to examine and improve hospital
discharge and follow-up care procedures for premature infants
born earlier than 37 weeks gestational age, report
rehospitalizations within six months, and use guidance from the
Centers for Medicare and Medicaid Services' Neonatal Outcomes
Improvement Project to improve outcomes, reduce costs, and
establish ongoing quality improvement for newborns.  By
December 31, 2009, the Department of Health and Senior Services
must prepare written educational publications with information
about possible complications, proper care, and support associated
with premature infants and must distribute the materials to
providers, hospitals, health departments, and medical
organizations.

INTERNET WEB-BASED PRIMARY CARE ACCESS PILOT PROJECT (Section
191.1200)

The General Assembly is required to appropriate $400,000 from the
Health Care Technology Fund to the Department of Social Services
to award a grant to implement an Internet web-based primary care
access pilot project designed as a collaboration between private
and public sectors to connect, where appropriate, a patient with
a primary care medical home and schedule patients into available
community-based appointments as an alternative to the
nonemergency use of the hospital emergency room as consistent
with federal law and regulations.

TELEHEALTH (Sections 191.1250, 191.1256, 191.1259, 191.1265, and
191.1271)

The substitute specifies that the delivery of health care through
telehealth is recognized and encouraged as a safe, practical, and
necessary practice in the state.  By January 1, 2010, the
Department of Health and Senior Services must establish quality
control rules and regulations to be used in removing and
improving the services of telehealth practitioners.

REPORTING SERIOUS HEALTH CARE INCIDENTS (Sections 197.553,
197.556, and 197.559)

Beginning January 1, 2010, hospitals must report all serious
health care incidents resulting in serious adverse events to a
federally designated patient safety organization no later than
one business day following the discovery of the incident.  The
report must describe the immediate actions taken to minimize
patient risk and the prevention measures carried out.  The
hospital will have 45 days after the incident was discovered to
submit a root cause analysis report and prevention plan to the
organization, with or without the technical assistance of the
organization.  If the organization finds any of the reports
provided by the hospital to be insufficient, the hospital will
have two attempts to make corrections.  The Department of Health
and Senior Services will assist hospitals with three or more
insufficient reports and accept reports from a hospital that does
not submit serious adverse events to an organization if it is
permissible under the federal Patient Safety and Quality
Improvement Act of 2005.  The organization assessing reported
incidents must provide the hospital with a report to prevent
future incidents.  These provisions must not be construed to
restrict the availability of information from original sources or
limit the disclosure or use of information from original sources.

PATIENT SAFETY ORGANIZATIONS (Sections 197.562 - 197.586)

If permitted by the federal Patient Safety and Quality
Improvement Act of 2005, the Department of Health and Senior
Services will publish an annual report by April 30 on reportable
incidents that indicates the number of reportable events by the
current National Quality Forum categories by rate per patient
encounter by region and by category of reportable incident and by
facility.  An individual is prohibited from disclosing the
actions, decisions, proceedings, discussions, or deliberations
occurring at a patient safety organization except for specified
purposes.  The proceedings and records of an organization cannot
be used as evidence in a civil action against a health care
provider arising out of matters that are subject to consideration
by an organization.  Patient safety work product is privileged
and confidential under the federal act.  Any reference to or
offer into evidence of patient safety work product during any
proceeding will constitute grounds for a mistrial or a
termination of the proceeding and reversible error on appeal from
any judgment or order in favor of any party who discloses it into
evidence.  An organization can disclose nonidentifiable
information regarding the number and types of patient safety
events that have occurred and must publish educational and
evidence-based information to improve patient care.  The
confidentiality of patient safety work product must not be
impaired or adversely affected by its submission to an
organization.  The exchange and disclosure of patient safety work
product by an organization is not a waiver of confidentiality of
the health care provider who submitted the data.  Any provider
furnishing services to an organization will not be liable for
civil damages for duties performed on behalf of the organization
unless done with actual malice, fraudulent intent, or bad faith.
Beginning January 1, 2010, a hospital that reports a reportable
incident cannot charge for or bill any entity for all services
related to the incident.  If a third-party payor denies a claim
because of lack of coverage for services that resulted from a
reportable incident of a serious adverse event, the health care
provider or facility involved cannot bill the patient for the
services.

HOSPITAL DISTRICT SALES TAXES (Section 205.202)

Hospital districts in certain counties, including Ripley County,
upon voter approval, are authorized to abolish the hospital
district property tax and impose a retail sales tax of up to 1%
for funding the hospital district.  Moneys collected from the tax
will be deposited into the newly created Hospital District Sales
Tax Fund with 1% retained and deposited into the General Revenue
Fund by the Director of the Department of Revenue for the cost of
collection.

MO HEALTHNET PAYMENTS (Sections 208.152 and 208.215)

MO HealthNet Program payments for services provided by hospitals,
physician offices, nursing homes, and other health care providers
will only be made if the service provider has a contractual
agreement with the carrier that has a health care transparency
agreement as of January 1, 2011.

Any third-party administrator, administrative service
organization, health benefit plan, or pharmacy benefits manager
must process and pay all properly submitted MO HealthNet Program
medical assistance subrogation claims for a period of three years
from the date the services were rendered, regardless of any other
timely filing requirement.  The entity cannot deny claims based
on the type or format of the claim form, failure to present
proper documentation of coverage at the point of sale, or failure
to obtain prior authorization.  The MO HealthNet Division within
the Department of Health and Senior Services must enforce its
rights within six years of the state's timely submission of a
claim.  MO HealthNet vendors who contract for third-party
liability services must provide the division with coverage and
eligibility data needed to identify if a MO HealtNet participant
has coverage from a liable third party before a claim can be
submitted to the state.

CO-PAYMENTS FOR PRESCRIPTION DRUGS (Section 354.535)

When the usual and customary retail price of a prescription drug
is less than the co-payment applied by a health maintenance
organization or health insurer, the enrollee will only be
required to pay the usual and customary retail price of the
prescription drug and there will be no further charge to the
enrollee or plan sponsor for the prescription.

HEALTH MAINTENANCE ORGANIZATIONS (HMOs)(Section 354.536)

The substitute requires proof that a dependent child is incapable
of maintaining employment due to a mental or physical handicap
and is dependent upon the policy holder for support and
maintenance to be submitted to the insured's HMO within 31 days
after the child has attained the age when the child's coverage is
to be terminated instead of the current at least 31 days.

STANDARDIZED INSURANCE APPLICATIONS (Section 374.184)

The Director of the Department of Insurance, Financial
Institutions and Professional Registration is required to
establish by rule uniform insurance application forms to be used
by all insurers for group health insurance policies.

REIMBURSEMENT CLAIMS (Section 376.384)

By January 1, 2010, a health carrier responding to an electronic
patient financial responsibility inquiry must respond with the
eligibility or benefit information codes for co-payment,
co-insurance, deductible, out-of-pocket maximum, remaining
deductible amount, and other cost containment elements.

HEALTH INSURANCE CO-PAYMENTS AND CO-INSURANCE (Section 376.391)

Health insurers are prohibited from imposing any co-payment or
co-insurance, or combination thereof, that exceeds 50% of the
total cost of providing the health care service to an enrollee.

DIAGNOSTIC IMAGING SERVICES (Section 376.394)

The substitute prohibits a health carrier or health benefit plan
from denying reimbursement for diagnostic imaging services based
solely on a licensed physician's specialty or professional board
certification.

CONVERTED HEALTH INSURANCE POLICIES (Sections 376.397 and
376.401)

When a group health insurance policy is terminated, the group
health insurer cannot refuse to convert a health insurance policy
or coverage of an insured person if he or she is eligible for
Medicare or any other state or federal benefits.  The Medicare or
any other state or federal benefit cannot result in a reduction
or termination of coverage of any person for a converted group
health insurance policy.

GROUP HEALTH INSURANCE POLICIES (Sections 376.421, 376.424, and
376.426)

The substitute repeals the provision which allows a group health
insurer to exclude or limit coverage on any person for policies
insuring fewer than 10 employees when there is evidence of
unsatisfactory individual insurability and also repeals a similar
provision for group health insurance policies with more than 10
employees when an application is not made within 31 days after
the date of eligibility or the person voluntarily terminates
coverage or fails to enroll during the open enrollment period.

Currently, group health insurance policies must contain a
provision that specifies any exclusions and limitations to the
policy in regard to a disease or physical condition that an
individual was treated for during the 12 months prior to the
enrollment date of an individual's policy.  The substitute limits
the exclusions and limitations to the prior six months before an
individual becomes covered under the policy.  Exclusions and
limitations cannot apply to a loss or disability that occurred
after the enrollment date or during the 18-month period
thereafter in the case of a late enrollee.  The substitute
requires proof that a dependent child is incapable of maintaining
employment due to a mental or physical handicap and is dependent
upon the policy holder for support and maintenance to be
submitted to the health insurer within 31 days after the
dependent child has attained the age when coverage is to be
terminated in order to sustain coverage instead of the current at
least 31 days.

INSURANCE COVERAGE AFTER TERMINATION OF EMPLOYMENT (Sections
376.428, 376.437, 376.439, and 376.443)

The substitute requires group policies by a health carrier or
health benefit plan to comply with the federal Consolidated
Omnibus Budget Reconciliation Act (COBRA) provisions regarding
the continuation of group health insurance coverage to an
individual who has terminated employment or membership.

Every group policy, contract, or health benefit plan issued,
delivered, or renewed on or after January 1, 2010, must contain a
provision that allows an employee or group member, whose
continuation coverage under the federal COBRA law or the state's
continuation law has expired to continue coverage under the group
policy or health benefit plan if the employee or group member was
55 years of age or older when the coverage expired.  The right to
extended continuation coverage will terminate upon the earliest
of the following:

(a)  The date the employee or group member fails to pay premiums
or required premium contributions;

(b)  The date that the group policy or plan is terminated to all
group members except if a different policy or plan is made
available;

(c)  The date on which the employee or group member becomes
insured under another group policy;

(d)  The date on which the employee or group member becomes
eligible for coverage under Medicare; or

(e)  The date on which the employee or group member attains 65
years of age.

The substitute requires all group health insurance policies
delivered, issued, or renewed on or after January 1, 2010, to
individuals eligible for continuation coverage under state law to
have their coverage be pooled experience to across all fully
insured group business in Missouri.  The experience of all
persons covered by a continuation of coverage provision must be
pooled and spread over all fully insured premiums in Missouri on
an equal percentage basis.

The substitute requires health carriers who provide group
insurance policies to persons who are exercising their
continuation of coverage rights under COBRA or the state to offer
them the option of continuation of coverage through a health
savings account eligible high deductible health plan.  The
premium for the high deductible plan must be consistent with the
underlying group plan of coverage rated relative to the standard
or manual rates for the benefits provided.

MISSOURI HEALTH INSURANCE PORTABILITY AND ACCOUNTABILITY ACT
(Sections 376.450.1 and 376.450.6)

The State Children's Health Insurance Program (SCHIP) coverage is
added to the list of credible coverages for individuals.  The
definition for "waiting period" as it relates to the Missouri
Health Insurance Portability and Accountability Act is revised to
be a time period that must pass before coverage for an employee
or dependent who is otherwise eligible to enroll in a group
health plan becomes effective.  Any time period before late or
special enrollment is not considered a waiting period for late or
special enrollees.  A waiting period begins on the date an
individual submits an application for coverage and ends when the
application for coverage is approved, denied, or lapses.  Health
issuers offering group coverage will be required to provide a
special enrollment period for a dependent in the case of a
placement for adoption.

EMPLOYER REQUIREMENTS (Section 376.453)

If an employer provides health insurance to an employee and the
employee pays any portion of the cost of the premium, the
employer must also provide a premium-only cafeteria plan or a
health reimbursement arrangement.

INDIVIDUAL HEALTH INSURANCE POLICIES (Section 376.776)

The substitute requires proof that a dependent child is incapable
of maintaining employment due to a mental or physical handicap
and is dependent upon the policy holder for support and
maintenance to be submitted to the health insurer within 31 days
after the dependent child has attained the age when coverage is
to be terminated in order to sustain coverage instead of the
current at least 31 days.

MISSOURI HEALTH INSURANCE POOL (HIGH RISK POOL) (Sections
376.966, 376.985, 376.986, and 376.987)

The substitute specifies that a person's eligibility for COBRA or
continuation rights under state law cannot render him or her
ineligible for coverage under the high risk pool.

All health insurers are required to notify an insured person when
he or she has exhausted 85% of his or her total lifetime health
insurance benefits and of the person's eligibility for and the
methods of applying for coverage under the pool.  Notification
must be repeated when an insured has exhausted 100% of his or her
total lifetime health insurance benefits.

By January 1, 2010, the pool must offer at least two health
benefit plans for an individual for coverage under the pool and
the newly established Show-Me Health Coverage Plan.  Subject to
funding, the pool's board can establish a premium subsidy program
for eligible low-income individuals.

An individual who has exceeded his or her total lifetime health
insurance benefits from his or her insurer is eligible for the
pool which has a $2 million lifetime benefit.  An individual who
is eligible and has an income of less than 350% of the federal
poverty level will receive a 50% discount off the pool's
premiums.

The pool is required to offer high deductible health plans in
conjunction with a health savings account on a guaranteed-issue
basis.

LIMITED MANDATE HEALTH INSURANCE POLICIES (Section 376.995)

The current marketing restriction placed upon the sale of limited
mandate health insurance policies is repealed which limits the
sale of these policies to individuals who do not have health
insurance or employers who certify in writing to the insurer that
they will terminate their current coverage because of the current
costs.

MANDATED COVERAGE FOR PROSTHETIC DEVICES AND SERVICES (Section
376.1232)

Every health carrier or health benefit plan delivered, issued,
continued, or renewed on or after January 1, 2010, must offer
coverage for prosthetic devices and services.

RIGHT TO RECEIVE DOCUMENTS (Section 376.1450)

Currently, a health insurance plan enrollee can opt out from
receiving documents from his or her managed care entity in print
form and access the documents electronically.  The substitute
specifies that the enrollee must, upon request, receive the
documents in the printed form.

HEALTH REIMBURSEMENT ARRANGEMENT ONLY PLANS (Section 376.1600)

The Director of the Department of Insurance, Financial
Institutions and Professional Registration is authorized to allow
employees to use funds from one or more employer health
reimbursement arrangement only plans to help pay for individual
health insurance coverage.  The substitute specifies that "health
reimbursement arrangement" means an employee benefit plan
provided by an employer which establish an account funded solely
by the employer to reimburse the employee for qualified medical
expenses incurred by the employee or his or her family.  An
employee is allowed to carry forward any unused funds at the end
of the coverage period to subsequent coverage periods.

HEALTH SAVINGS ACCOUNT HEALTH BENEFIT PLANS (Section 376.1603)

The Director of the Department of Insurance, Financial
Institutions and Professional Registration must develop flexible
guidelines for coverage and approval of health savings account
eligible high deductible health plans for use with health savings
accounts which comply with federal requirements.  The department
director is authorized to promote and encourage the marketing of
these plans in the state and must conduct a national study of
health savings account eligible high deductible plans available
in other states and determine if and how these plans serve the
uninsured and if they should be made available to Missourians.
The department director must develop a fast track or automatic
approval process for these plans that have already been approved
in Missouri or other states.

INSURANCE PRODUCTS BARRIERS STUDY (Section 376.1618)

The Director of the Department of Insurance, Financial
Institutions and Professional Registration must study and
recommend to the General Assembly on needed changes to remove any
unnecessary application and marketing barriers as well as state
statutory and regulatory requirements that limit the entry of new
health insurance products into the Missouri insurance market.
The department director must examine proposals adopted in other
states that streamline the regulatory environments to make it
easier for health insurance companies to market new and existing
products.  The report of the department director's findings and
recommendations must be submitted to the General Assembly by
January 1, 2010.

SMALL EMPLOYER HEALTH INSURANCE AVAILABILITY ACT (Sections
379.930, 379.940, and 379.952)

The definition of "dependent" is changed in the Small Employer
Health Insurance Availability Act to be consistent with the
definition in the statutes regarding health maintenance
organizations and individual and group policies by revising it to
be a person who is a spouse, an unmarried child who resides in
Missouri and is younger than 25 years of age and is not covered
by any group or individual health benefit plan or entitled to
federal Social Security assistance benefits, or an unmarried
child of any age who is disabled and dependent upon his or her
parent.

A small employer insurance carrier must reasonably compensate an
agent or broker for the sale of any small employer health benefit
plan, and a small employer carrier must maintain and issue all
health benefit plans it actively markets to small employers in
the state.

Currently, a small employer insurance carrier will not be in
violation of any unfair trade practice if the small employer
charges a lesser premium or deductible for employees who do not
use tobacco products.  The substitute revises the definition of
"unfair trade practice" by using the provisions that apply to all
insurance carriers in Missouri instead of only to health and
accident insurance companies.

SHOW-ME HEALTH COVERAGE PLAN (Sections 1 - 10)

Subject to appropriations, the substitute establishes the Show-Me
Health Coverage Plan in the Department of Social Services to
provide health care coverage through the Missouri Health
Insurance Pool to low-income adult Missourians.  In order to
operate the program, the department must apply to the United
States Department of Health and Human Services for approval of a
Section 115 demonstration waiver to develop and implement the
plan, provided that any reduction of disproportionate share of
hospital funds applied to the cost of the plan as required by the
waiver will not be disproportionate to the impact on low-income
uninsured individuals.  The plan will be void if there are no
federal funds appropriated to the state or if no disproportionate
share hospital funds are applied to the program.  The department
must get approval of the Joint Committee on MO HealthNet before
applying for the federal waiver.  The Department of Insurance,
Financial Institutions and Professional Registration and the MO
HealthNet Division will provide oversight of the marketing
practices of the plan, and the Department of Social Services and
the Missouri Health Insurance Pool must promote the plan and
provide information to potential eligible individuals.  The plan
is not an entitlement program, and the maximum enrollment is
dependent on appropriated funding from the General Assembly and
may be phased in incrementally.  The substitute specifies the
eligibility requirements for participants in the plan.

MO HEALTHNET FOR KIDS PROGRAM (Section 11)

If the income of a taxpayer who reports the absence of health
care coverage for a dependent child does not exceed 150% of the
federal poverty level, the Department of Revenue must send a
notice, which is to be developed by the Department of Social
Services, to the taxpayer indicating that the child may be
eligible for the MO HealthNet for Kids Program and provide
information about enrollment in the program.

MO HEALTHNET PROGRAM REIMBURSEMENTS (Section 12)

Subject to appropriations, the Department of Social Services must
establish a rate for the reimbursement of physicians,
optometrists, podiatrists, and psychologists for services
rendered to patients under the MO HealthNet Program which is
equal to the reimbursement for the same or similar services
rendered.

The provisions of the substitute regarding the Show-Me Health
Coverage Plan will expire six years from the effective date.

The substitute contains an emergency clause for the provisions
regarding group policies to comply with the federal COBRA
provisions and the provisions regarding certain hospital
districts lowering their property tax levies.

FISCAL NOTE:  Estimated Cost on General Revenue Fund of Unknown
but Greater than $22,186,624 in FY 2010, Unknown but Greater than
$38,687,173 in FY 2011, and Unknown but Greater than $55,000,796
in FY 2012.  Estimated Cost on Other State Funds of Unknown but
Greater than $7,518,576 in FY 2010, Unknown but Greater than
$11,775,469 in FY 2011, and Unknown but Greater than $15,407,217
in FY 2012.

PROPONENTS:  Supporters say that the bill will help fund health
care for low-income individuals who cannot afford insurance by
utilizing disproportionate share hospital funds and the federal
reimbursement allowance program to provide coverage for these
uninsured individuals instead of using those funds for
uncompensated care at hospitals under the newly established Show-
Me Health Care Coverage Plan.  A federal waiver is required in
order to cover a person over 100% of the federal poverty level;
however, a state plan amendment will cover those under 100%.  The
health savings account will be handled by the insurance carrier.
The plan it is not mandatory for eligible individuals.  The
provisions specified in the plan focus on wellness and prevention
and will be delivered through current Medicaid providers.

Testifying for the bill were Senator Dempsey; and Missouri
Hospital Association.

OPPONENTS:  There was no opposition voiced to the committee.

OTHERS:  Others testifying on the bill say that the Show-Me
Health Coverage Plan does not include dental or vision services.
The total plan is subject to appropriations and requires
approval.  Uncompensated care payments will be redirected to
provide coverage for uninsured persons.

Testifying on the bill was Department of Social Services.

Missouri House of Representatives
95th General Assembly, 1st Regular Session
Last Updated November 17, 2009 at 9:26 am