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Arkansas House Bill HB1295

Arkansas 2025 Regular Session

Arkansas House Bill HB1295 Compare Versions

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11 Stricken language would be deleted from and underlined language would be added to present law.
22 *ANS081* 01/29/2025 10:02:29 AM ANS081
33 State of Arkansas 1
44 95th General Assembly A Bill 2
55 Regular Session, 2025 HOUSE BILL 1295 3
66 4
77 By: Representative L. Johnson 5
88 By: Senator Irvin 6
99 7
1010 For An Act To Be Entitled 8
1111 AN ACT TO CREATE THE HEALTHCARE COST -SHARING 9
1212 COLLECTIONS ACT; AND FOR OTHER PURPOSES. 10
1313 11
1414 12
1515 Subtitle 13
1616 TO CREATE THE HEALTHCARE COST -SHARING 14
1717 COLLECTIONS ACT. 15
1818 16
1919 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF ARKANSAS: 17
2020 18
2121 SECTION 1. Arkansas Code Title 23, Chapter 99, is amended to add an 19
2222 additional subchapter to read as follows: 20
2323 21
2424 Subchapter 19 — Healthcare Cost-Sharing Collections Act 22
2525 23
2626 23-99-1901. Title. 24
2727 This subchapter shall be known and may be cited as the "Healthcare 25
2828 Cost-Sharing Collections Act". 26
2929 27
3030 23-99-1902. Definitions. 28
3131 As used in this subchapter: 29
3232 (1)(A) "Contracting entity" means a healthcare insurer, or a 30
3333 subcontractor, affiliate, or other entity that contracts directly or 31
3434 indirectly with a healthcare provider for the delivery of healthcare services 32
3535 to enrollees. 33
3636 (B) "Contracting entity" includes without limitation: 34
3737 (i) An insurance company; 35
3838 (ii) A health maintenance organization; 36 HB1295
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4141 (iii) A hospital and medical service corporation; 1
4242 (iv) A preferred provider organization; 2
4343 (v) A risk-based provider organization; 3
4444 (vi) A third-party administrator; 4
4545 (vii) A nonprofit agricultural membership 5
4646 organization; and 6
4747 (viii) A prescription benefit management company; 7
4848 (2)(A) "Cost sharing" means the amount of the costs that are 8
4949 covered by a health benefit plan for which an enrollee is financially 9
5050 responsible. 10
5151 (B) "Cost sharing" includes without limitation a 11
5252 deductible payment, a coinsurance amount, a copayment, or other similar 12
5353 charges. 13
5454 (C) "Cost sharing" does not include a premium, balance 14
5555 billing amount for out -of-network healthcare providers, or the cost of 15
5656 noncovered services; 16
5757 (3) "Enrollee" means an individual who is entitled to receive 17
5858 healthcare services under the terms of a health benefit plan; 18
5959 (4) "Entity of the state" means an agency, board, bureau, 19
6060 commission, committee, council, department, division, institution of higher 20
6161 education, office, public school, quasi -public organization, or other 21
6262 political subdivision of the state; 22
6363 (5)(A) "Health benefit plan" means an individual, blanket, or 23
6464 group plan, policy, or contract for healthcare services issued, renewed, or 24
6565 extended in this state by a healthcare insurer. 25
6666 (B) "Health benefit plan" includes a nonfederal 26
6767 governmental plan as defined in 29 U.S.C. § 1002(32), as it existed on 27
6868 January 1, 2025. 28
6969 (C) "Health benefit plan" does not include: 29
7070 (i) A plan that provides only dental benefits; 30
7171 (ii) A plan that provides only eye and vision 31
7272 benefits; 32
7373 (iii) A disability income plan; 33
7474 (iv) A credit insurance plan; 34
7575 (v) Insurance coverage issued as a supplement to 35
7676 liability insurance; 36 HB1295
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7979 (vi) Medical payments under an automobile or 1
8080 homeowners’ insurance plan; 2
8181 (vii) A health benefit plan provided under Arkansas 3
8282 Constitution, Article 5, § 32, the Workers' Compensation Law, § 11 -9-101 et 4
8383 seq., or the Public Employee Workers’ Compensation Act, § 21 -5-601 et seq.; 5
8484 (viii) A plan that provides only indemnity for 6
8585 hospital confinement; 7
8686 (ix) An accident-only plan; 8
8787 (x) A specified disease plan; 9
8888 (xi) A policy, contract, certificate, or agreement 10
8989 offered or issued by a healthcare insurer to provide, deliver, arrange for, 11
9090 pay for, or reimburse any of the costs of healthcare services, including 12
9191 pharmacy benefits, to an entity of the state; 13
9292 (xii) A long-term care insurance plan; or 14
9393 (xiii) A healthcare provider self -insured plan; 15
9494 (6) "Healthcare contract" means a contract entered into, 16
9595 materially amended, or renewed between a contracting entity and a healthcare 17
9696 provider for the delivery of healthcare services to an enrollee; 18
9797 (7)(A) "Healthcare insurer" means an entity that is authorized 19
9898 by this state to offer or provide health benefit plans, policies, subscriber 20
9999 contracts, or any other contracts of a similar nature that indemnify or 21
100100 compensate a healthcare provider for the provision of healthcare services. 22
101101 (B) "Healthcare insurer" includes: 23
102102 (i) An insurance company; 24
103103 (ii) A hospital and medical service corporation; 25
104104 (iii) A health maintenance organization; 26
105105 (iv) A risk-based provider organization; 27
106106 (v) A nonprofit agricultural membership 28
107107 organization; 29
108108 (vi) Any sponsor of a nonfederal self -funded 30
109109 governmental plan in this state; and 31
110110 (vii) A third-party administrator or other entity 32
111111 providing claims administration services for a health benefit plan; 33
112112 (8) "Healthcare provider" means a person or entity that is 34
113113 licensed, certified, or otherwise authorized by the laws of this state to 35
114114 administer healthcare services; 36 HB1295
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117117 (9) "Healthcare services" means services or goods provided for 1
118118 the purpose of or incidental to the purpose of preventing, diagnosing, 2
119119 treating, alleviating, relieving, curing, or healing human illness, disease, 3
120120 condition, disability, or injury; 4
121121 (10) "Medical loss ratio" means the measure used in healthcare 5
122122 insurance to assess the percentage of premium dollars spent on medical claims 6
123123 and quality improvements versus administrative costs; 7
124124 (11) "Net premium income" means the dollar amount of direct 8
125125 business plus reinsurance assumed minus reinsurance ceded; and 9
126126 (12) "Premium" means the dollar amount charged for the insurance 10
127127 coverage of an enrollee. 11
128128 12
129129 23-99-1903. Collection authority of healthcare insurers. 13
130130 (a) A healthcare insurer shall: 14
131131 (1) Pay a healthcare provider the full amount due for healthcare 15
132132 services under the terms of a health benefit plan, including any cost 16
133133 sharing; 17
134134 (2) Have the sole responsibility for collecting cost sharing 18
135135 from an enrollee; and 19
136136 (3) Upon request of the enrollee, collect cost sharing 20
137137 throughout the plan year in increments defined by the healthcare insurer. 21
138138 (b) A healthcare insurer shall not: 22
139139 (1) Withhold an amount for cost sharing from the payment to a 23
140140 healthcare provider; 24
141141 (2) Require a healthcare provider to offer additional discounts 25
142142 to an enrollee outside the terms of the healthcare contract between the 26
143143 healthcare insurer and the healthcare provider; 27
144144 (3) Deny or delay payment to a healthcare provider for the 28
145145 healthcare insurer’s failure to collect the enrollee’s cost sharing; or 29
146146 (4) Require a person or entity to collect the enrollee’s cost 30
147147 sharing on behalf of the healthcare insurer. 31
148148 (c) Any value of a copay assistance coupon or similar assistance 32
149149 program shall be applied to the enrollee’s annual cost -sharing requirement 33
150150 and may be paid directly to the healthcare insurer on the enrollee’s behalf. 34
151151 (d) A healthcare insurer shall not cancel the health benefit plan of 35
152152 an enrollee for failure to collect cost sharing. 36 HB1295
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155155 (e) An expense incurred by a healthcare insurer to implement or comply 1
156156 with this subchapter shall not be used as justification to increase premiums 2
157157 or decrease payments to a healthcare provider. 3
158158 4
159159 23-99-1904. Transparency and reporting. 5
160160 (a)(1)(A) Annually on or before March 1, a healthcare insurer shall 6
161161 file with the Insurance Commissioner a full and true statement of the 7
162162 healthcare insurer's financial condition, transactions, and affairs as of the 8
163163 December 31 preceding. 9
164164 (B)(i) The commissioner may grant an extension of time to 10
165165 file the statement required under subdivision (a)(1)(A) of this section for 11
166166 good cause shown. 12
167167 (ii) The commissioner may grant an extension of time 13
168168 for good cause under subdivision (a)(1)(B)(i) of this section only if a 14
169169 written application for an extension of time is received at least five (5) 15
170170 business days before the filing due date. 16
171171 (2) The statement required under subdivision (a)(1)(A) of this 17
172172 section shall be prepared according to the companion National Association of 18
173173 Insurance Commissioners’ Annual and Quarterly Statement Instructions, as 19
174174 adopted by rule by the commissioner, and follow those accounting principles 20
175175 and procedures prescribed by the companion National Association of Insurance 21
176176 Commissioners’ Accounting Practices and Procedures Manual, as adopted by rule 22
177177 by the commissioner. 23
178178 (3) The statement required under subdivision (a)(1)(A) of this 24
179179 section shall include the healthcare insurer's: 25
180180 (A) Total assets; 26
181181 (B) Total liabilities; 27
182182 (C) Total reserves; 28
183183 (D)(i) Net premium income for each line of business of the 29
184184 healthcare insurer. 30
185185 (ii) Each line of business of the healthcare insurer 31
186186 shall include: 32
187187 (a) Comprehensive hospital plans and 33
188188 comprehensive medical plans; 34
189189 (b) Medicare supplement plans; 35
190190 (c) Dental-only plans; 36 HB1295
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193193 (d) Vision-only plans; 1
194194 (e) The Federal Employees Health Benefits 2
195195 Program; 3
196196 (f) Medicare; 4
197197 (g) Medicare Advantage Plans; 5
198198 (h) The Arkansas Medicaid Program; 6
199199 (i) Plans offered under the Medicaid Provider -7
200200 Led Organized Care Act, § 20 -77-2701 et seq., or any successor program; 8
201201 (j) Qualified health plans offered under the 9
202202 Arkansas Health and Opportunity for Me Program or any successor program; 10
203203 (k) Other Medicaid plans; and 11
204204 (l) Other health benefit plans; 12
205205 (E)(i) Total claims paid for each line of business of the 13
206206 healthcare insurer. 14
207207 (ii) Each line of business of the healthcare insurer 15
208208 shall include: 16
209209 (a) Comprehensive hospital plans and 17
210210 comprehensive medical plans; 18
211211 (b) Medicare supplement plans; 19
212212 (c) Dental-only plans; 20
213213 (d) Vision-only plans; 21
214214 (e) The Federal Employees Health Benefits 22
215215 Program; 23
216216 (f) Medicare; 24
217217 (g) Medicare Advantage Plans; 25
218218 (h) The Arkansas Medicaid Program; 26
219219 (i) Plans offered under the Medicaid Provider-27
220220 Led Organized Care Act, § 20 -77-2701 et seq., or any successor program; 28
221221 (j) Qualified health plans offered under the 29
222222 Arkansas Health and Opportunity for Me Program or any successor program; 30
223223 (k) Other Medicaid plans; and 31
224224 (l) Other health benefit plans; 32
225225 (F)(i) Total claims denied for each line of business of 33
226226 the healthcare insurer. 34
227227 (ii) Each line of business of the healthcare insurer 35
228228 shall include: 36 HB1295
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231231 (a) Comprehensive hospital plans and 1
232232 comprehensive medical plans; 2
233233 (b) Medicare supplement plans; 3
234234 (c) Dental-only plans; 4
235235 (d) Vision-only plans; 5
236236 (e) The Federal Employees Health Benefits 6
237237 Program; 7
238238 (f) Medicare; 8
239239 (g) Medicare Advantage Plans; 9
240240 (h) The Arkansas Medicaid Program; 10
241241 (i) Plans offered under the Medicaid Provider -11
242242 Led Organized Care Act, § 20 -77-2701 et seq., or any successor program; 12
243243 (j) Qualified health plans offered under the 13
244244 Arkansas Health and Opportunity for Me Program or any successor program; 14
245245 (k) Other Medicaid plans; and 15
246246 (l) Other health benefit plans; and 16
247247 (G) Low, high, and average premium price data for each 17
248248 line of service of the healthcare insurer. 18
249249 (b) A healthcare insurer shall file an executive summary of the 19
250250 statement required under subdivision (a)(1)(A) of this section with the: 20
251251 (1) House Committee on Insurance and Commerce; and 21
252252 (2) Senate Committee on Insurance and Commerce. 22
253253 (c)(1) Annually, between thirty (30) and sixty (60) days before the 23
254254 initial date of open enrollment for Medicare, a healthcare insurer shall send 24
255255 a report to each enrollee. 25
256256 (2) The report required under subdivision (c)(1) of this section 26
257257 shall include: 27
258258 (A) The dollar amount of premiums collected from the 28
259259 enrollee and paid to the healthcare insurer from the previous period of 29
260260 January 1 through December 31; 30
261261 (B) The dollar amount of premiums paid to the healthcare 31
262262 insurer by a person or entity, including without limitation an employer, 32
263263 other than the enrollee on behalf of the enrollee from the previous period of 33
264264 January 1 through December 31; 34
265265 (C) The dollar amount of cost sharing collected, itemized 35
266266 by deductibles, coinsurance, and copayments, or similar charges from the 36 HB1295
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269269 enrollee from the previous period of January 1 through December 31; 1
270270 (D) The dollar amount of the unpaid cost -sharing balance 2
271271 owed to the healthcare insurer from the previous period of January 1 through 3
272272 December 31; 4
273273 (E) The payment made to each in -network healthcare 5
274274 provider on behalf of the enrollee from the previous period of January 1 6
275275 through December 31; 7
276276 (F) The payment made to each out -of-network healthcare 8
277277 provider on behalf of the enrollee from the previous period of January 1 9
278278 through December 31; 10
279279 (G) A list of claims denied to a healthcare provider who 11
280280 provided healthcare services to the enrollee from the previous period of 12
281281 January 1 through December 31; 13
282282 (H) The low, average, and high premium rates comparable to 14
283283 the enrollee’s health benefit plan; 15
284284 (I) A list of any underwriting, auditing, actuarial, 16
285285 financial analysis, treasury, and investment expenses; 17
286286 (J) A list of any marketing and sales expenses, including 18
287287 without limitation advertising, member relations, member enrollment, and all 19
288288 expenses associated with producers, brokers, and benefit consultants; 20
289289 (K) A list of any claims operations expenses, including 21
290290 without limitation those expenses for adjudication, appeals, settlements, and 22
291291 expenses associated with paying claims; 23
292292 (L) A list of any medical administration expenses, 24
293293 including without limitation disease management, utilization review, and 25
294294 medical management; 26
295295 (M) A list of any network operations expenses, including 27
296296 without limitation those expenses for contracting, hospital and physician 28
297297 relations, and medical policy procedures; 29
298298 (N) A list of any charitable expenses, including without 30
299299 limitation to contributions to tax -exempt foundations and community benefits; 31
300300 (O) The amount of state insurance premium taxes; 32
301301 (P) The amount paid for board, bureau, and association 33
302302 fees; 34
303303 (Q) The fees related to depreciation; and 35
304304 (R) A list of miscellaneous expenses described in detail 36 HB1295
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307307 by expense, including any expense not included in subdivisions (c)(2)(I) —(Q) 1
308308 of this section. 2
309309 3
310310 23-99-1905. Prohibition on pricing increases. 4
311311 (a) Except as provided in subsection (b) of this section, a healthcare 5
312312 insurer shall not increase cost sharing, premiums, or other fees, including 6
313313 per member per month payments, on an enrollee, employer, or any other entity 7
314314 paying cost sharing, premiums, or other fees, including per member per month 8
315315 payments, on behalf of an enrollee for healthcare insurance coverage. 9
316316 (b) A healthcare insurer may increase cost sharing, premiums, or other 10
317317 fees, including per member per month payments, on an enrollee, employer, or 11
318318 any other entity paying cost sharing, premiums, or other fees, including per 12
319319 member per month payments, on behalf of an enrollee for healthcare insurance 13
320320 coverage if: 14
321321 (1) The healthcare insurer’s excess of capital over its 15
322322 mandatory control level RBC as defined in § 23 -63-1302(12)(C) is less than 16
323323 six hundred fifty percent (650%); and 17
324324 (2)(A) The healthcare insurer’s medical loss ratio is ninety 18
325325 percent (90%) or greater on clinical services and quality improvement. 19
326326 (B) The calculation of medical claims and quality 20
327327 improvements for a healthcare insurer's medical loss ratio under subdivision 21
328328 (b)(2)(A) of this section shall exclude: 22
329329 (i) Any performance -based compensation, bonus, or 23
330330 other financial incentive paid directly or indirectly to a contracting entity 24
331331 employee, affiliate, contractor, or other entity or individual; 25
332332 (ii) Any expense under § 23 -99-1904(c)(2)(I)—(R); 26
333333 (iii) Any expense associated with carrying enrollee 27
334334 medical debt; and 28
335335 (iv) Cost sharing. 29
336336 30
337337 23-99-1906. Violation of Trade Practices Act — Enforcement. 31
338338 (a) A violation of this subchapter is a deceptive act, as defined by 32
339339 the Trade Practices Act, § 23 -66-201 et seq., and § 4 -88-101 et seq. 33
340340 (b) All remedies, penalties, and authority granted to the Insurance 34
341341 Commissioner under the Trade Practices Act, § 23 -66-201 et seq., shall be 35
342342 available to the commissioner for the enforcement of this subchapter. 36 HB1295
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345345 (c) The State Insurance Department shall enforce this subchapter. 1
346346 2
347347 23-99-1907. Private right of action. 3
348348 An enrollee may file suit against a healthcare insurer in a court of 4
349349 competent jurisdiction and is entitled to collect: 5
350350 (1) Double the amount of any overcharge of premiums and cost 6
351351 sharing; 7
352352 (2) The enrollee’s costs related to the suit; and 8
353353 (3) Reasonable attorney’s fees. 9
354354 10
355355 23-99-1908. Rules. 11
356356 The Insurance Commissioner may promulgate rules to implement this 12
357357 subchapter. 13
358358 14
359359 23-99-1909. Severability. 15
360360 The provisions of this section shall be severable, and if any phrase, 16
361361 clause, sentence, or provision is deemed unenforceable, the remaining 17
362362 provisions of the section shall be enforceable. 18
363363 19
364364 20
365365 21
366366 22
367367 23
368368 24
369369 25
370370 26
371371 27
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380380 36