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General Assembly Raised Bill No. 194
February Session, 2020
LCO No. 1565
Referred to Committee on HUMAN SERVICES
Introduced by:
(HS)
AN ACT CONCERNING OB SOLETE REFERENCES RE LATING TO
THE DEPARTMENT OF SO CIAL SERVICES IN THE GENERAL
STATUTES.
Be it enacted by the Senate and House of Representatives in General
Assembly convened:
Section 1. Subsection (c) of section 17a-485d of the general statutes is 1
repealed and the following is substituted in lieu thereof (Effective July 1, 2
2020): 3
(c) The Commissioner of Social Services [shall take such action as may 4
be necessary to] may amend the Medicaid state plan to provide for 5
coverage of optional adult rehabilitation services supplied by providers 6
of mental health services or substance abuse rehabilitation services for 7
adults with serious and persistent mental illness or who have 8
alcoholism or other substance use disorders, that are certified by the 9
Department of Mental Health and Addiction Services. The 10
Commissioner of Social Services [shall] may adopt regulations, in 11
accordance with the provisions of chapter 54, to implement optional 12
rehabilitation services under the Medicaid program. The commissioner 13
[shall] may implement policies and procedures to administer such 14 Raised Bill No. 194
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services while in the process of adopting such policies or procedures in 15
regulation form, provided [notice of intention to adopt the regulations 16
is printed in the Connecticut Law Journal within forty-five days of 17
implementation, and any] the commissioner posts such policies and 18
procedures on the eRegulations System prior to adopting the policies 19
and procedures. Any such policies or procedures shall be valid until the 20
time final regulations are effective. 21
Sec. 2. Subsection (b) of section 17b-59a of the general statutes is 22
repealed and the following is substituted in lieu thereof (Effective July 1, 23
2020): 24
(b) The Commissioner of Social Services, in consultation with the 25
executive director of the Office of Health Strategy, established under 26
section 19a-754a, shall (1) develop, throughout the Departments of 27
Developmental Services, Public Health, Correction, Children and 28
Families, Veterans Affairs and Mental Health and Addiction Services, 29
uniform management information, uniform statistical information, 30
uniform terminology for similar facilities [,] and uniform electronic 31
health information technology standards, [and uniform regulations for 32
the licensing of human services facilities,] (2) plan for increased 33
participation of the private sector in the delivery of human services, (3) 34
provide direction and coordination to federally funded programs in the 35
human services agencies and recommend uniform system 36
improvements and reallocation of physical resources and designation of 37
a single responsibility across human services agencies lines to facilitate 38
shared services and eliminate duplication. 39
Sec. 3. Subsection (a) of section 17b-349 of the general statutes is 40
repealed and the following is substituted in lieu thereof (Effective July 1, 41
2020): 42
(a) The rates paid by the state to community health centers [and 43
freestanding medical clinics] participating in the Medicaid program 44
may be adjusted annually on the basis of the cost reports submitted to 45
the Commissioner of Social Services. [, except that rates effective July 1, 46 Raised Bill No. 194
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1989, shall remain in effect through June 30, 1990.] The Department of 47
Social Services may develop an alternative payment methodology to 48
replace the encounter-based reimbursement system. Such methodology 49
shall be approved by the joint standing committees of the General 50
Assembly having cognizance of matters relating to human services and 51
appropriations and the budgets of state agencies. Until such 52
methodology is implemented, the Department of Social Services shall 53
distribute supplemental funding, within available appropriations, to 54
federally qualified health centers based on cost, volume and quality 55
measures as determined by the Commissioner of Social Services. (1) 56
Beginning with the one-year rate period commencing on October 1, 57
2012, and annually thereafter, the Commissioner of Social Services may 58
add to a community health center's rates, if applicable, a capital cost rate 59
adjustment that is equivalent to the center's actual or projected year-to-60
year increase in total allowable depreciation and interest expenses 61
associated with major capital projects divided by the projected service 62
visit volume. For the purposes of this subsection, "capital costs" means 63
expenditures for land or building purchases, fixed assets, movable 64
equipment, capitalized financing fees and capitalized construction 65
period interest and "major capital projects" means projects with costs 66
exceeding two million dollars. The commissioner may revise such 67
capital cost rate adjustment retroactively based on actual allowable 68
depreciation and interest expenses or actual service visit volume for the 69
rate period. (2) The commissioner shall establish separate capital cost 70
rate adjustments for each Medicaid service provided by a center. (3) The 71
commissioner shall not grant a capital cost rate adjustment to a 72
community health center for any depreciation or interest expenses 73
associated with capital costs that were disapproved by the federal 74
Department of Health and Human Services or another federal or state 75
government agency with capital expenditure approval authority related 76
to health care services. (4) The commissioner may allow actual debt 77
service in lieu of allowable depreciation and interest expenses 78
associated with capital items funded with a debt obligation, provided 79
debt service amounts are deemed reasonable in consideration of the 80
interest rate and other loan terms. (5) The commissioner shall 81 Raised Bill No. 194
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implement policies and procedures necessary to carry out the 82
provisions of this subsection while in the process of adopting such 83
policies and procedures in regulation form, provided notice of intent to 84
adopt such regulations is [published in the Connecticut Law Journal not 85
later than twenty days after implementation] posted on the 86
eRegulations System prior to adoption of the policies and procedures. 87
Such policies and procedures shall be valid until the time final 88
regulations are effective. 89
Sec. 4. Section 38a-479aa of the general statutes is repealed and the 90
following is substituted in lieu thereof (Effective July 1, 2020): 91
(a) As used in this part and subsection (b) of section 20-138b: 92
(1) "Covered benefits" means health care services to which an enrollee 93
is entitled under the terms of a managed care plan; 94
(2) "Enrollee" means an individual who is eligible to receive health 95
care services through a preferred provider network; 96
(3) "Health care services" means health care related services or 97
products rendered or sold by a provider within the scope of the 98
provider's license or legal authorization, and includes hospital, medical, 99
surgical, dental, vision and pharmaceutical services or products; 100
(4) "Managed care organization" means (A) a managed care 101
organization, as defined in section 38a-478, (B) any other health insurer, 102
or (C) a reinsurer with respect to health insurance; 103
(5) "Managed care plan" has the same meaning as provided in section 104
38a-478; 105
(6) "Person" means an individual, agency, political subdivision, 106
partnership, corporation, limited liability company, association or any 107
other entity; 108
(7) "Preferred provider network" means a person that is not a 109
managed care organization, but that pays claims for the delivery of 110 Raised Bill No. 194
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health care services, accepts financial risk for the delivery of health care 111
services and establishes, operates or maintains an arrangement or 112
contract with providers relating to (A) the health care services rendered 113
by the providers, and (B) the amounts to be paid to the providers for 114
such services. "Preferred provider network" does not include (i) a 115
workers' compensation preferred provider organization established 116
pursuant to section 31-279-10 of the regulations of Connecticut state 117
agencies, (ii) an independent practice association or physician hospital 118
organization whose primary function is to contract with insurers and 119
provide services to providers, (iii) a clinical laboratory, licensed 120
pursuant to section 19a-30, whose primary payments for any contracted 121
or referred services are made to other licensed clinical laboratories or for 122
associated pathology services, or (iv) a pharmacy benefits manager 123
responsible for administering pharmacy claims whose primary function 124
is to administer the pharmacy benefit on behalf of a health benefit plan; 125
(8) "Provider" means an individual or entity duly licensed or legally 126
authorized to provide health care services; and 127
(9) "Commissioner" means the Insurance Commissioner. 128
(b) No preferred provider network may enter into or renew a 129
contractual relationship with a managed care organization or conduct 130
business in this state unless the preferred provider network is licensed 131
by the commissioner. Any person seeking to obtain or renew a license 132
shall submit an application to the commissioner, on such form as the 133
commissioner may prescribe, and shall include the filing described in 134
this subsection, except that a person seeking to renew a license may 135
submit only the information necessary to update its previous filing. 136
Such license shall be issued or renewed annually on July first and 137
applications shall be submitted by May first of each year in order to 138
qualify for the license issue or renewal date. The filing required from 139
such preferred provider network shall include the following 140
information: (1) The identity of the preferred provider network and any 141
company or organization controlling the operation of the preferred 142
provider network, including the name, business address, contact 143 Raised Bill No. 194
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person, a description of the controlling company or organization and, 144
where applicable, the following: (A) A certificate from the Secretary of 145
the State regarding the preferred provider network's and the controlling 146
company's or organization's good standing to do business in the state; 147
(B) a copy of the preferred provider network's and the controlling 148
company's or organization's financial statement completed in 149
accordance with sections 38a-53 and 38a-54, as applicable, for the end of 150
its most recently concluded fiscal year, along with the name and address 151
of any public accounting firm or internal accountant which prepared or 152
assisted in the preparation of such financial statement; (C) a list of the 153
names, official positions and occupations of members of the preferred 154
provider network's and the controlling company's or organization's 155
board of directors or other policy-making body and of those executive 156
officers who are responsible for the preferred provider network's and 157
controlling company's or organization's activities with respect to the 158
health care services network; (D) a list of the preferred provider 159
network's and the controlling company's or organization's principal 160
owners; (E) in the case of an out-of-state preferred provider network, 161
controlling company or organization, a certificate that such preferred 162
provider network, company or organization is in good standing in its 163
state of organization; (F) in the case of a Connecticut or out-of-state 164
preferred provider network, controlling company or organization, a 165
report of the details of any suspension, sanction or other disciplinary 166
action relating to such preferred provider network, or controlling 167
company or organization in this state or in any other state; and (G) the 168
identity, address and current relationship of any related or predecessor 169
controlling company or organization. For purposes of this 170
subparagraph, "related" means that a substantial number of the board 171
or policy-making body members, executive officers or principal owners 172
of both companies are the same; (2) a general description of the 173
preferred provider network and participation in the preferred provider 174
network, including: (A) The geographical service area of and the names 175
of the hospitals included in the preferred provider network; (B) the 176
primary care physicians, the specialty physicians, any other contracting 177
providers and the number and percentage of each group's capacity to 178 Raised Bill No. 194
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accept new patients; (C) a list of all entities on whose behalf the 179
preferred provider network has contracts or agreements to provide 180
health care services; (D) a table listing all major categories of health care 181
services provided by the preferred provider network; (E) an 182
approximate number of total enrollees served in all of the preferred 183
provider network's contracts or agreements; (F) a list of subcontractors 184
of the preferred provider network, not including individual 185
participating providers, that assume financial risk from the preferred 186
provider network and to what extent each subcontractor assumes 187
financial risk; (G) a contingency plan describing how contracted health 188
care services will be provided in the event of insolvency; and (H) any 189
other information requested by the commissioner; and (3) the name and 190
address of the person to whom applications may be made for 191
participation. 192
(c) Any person developing a preferred provider network, or 193
expanding a preferred provider network into a new county, pursuant to 194
this section and subsection (b) of section 20-138b, shall publish a notice, 195
in at least one newspaper having a substantial circulation in the service 196
area in which the preferred provider network operates or will operate, 197
indicating such planned development or expansion. Such notice shall 198
include the medical specialties included in the preferred provider 199
network, the name and address of the person to whom applications may 200
be made for participation and a time frame for making application. The 201
preferred provider network shall provide the applicant with written 202
acknowledgment of receipt of the app lication. Each complete 203
application shall be considered by the preferred provider network in a 204
timely manner. 205
(d) (1) Each preferred provider network shall file with the 206
commissioner and make available upon request from a provider the 207
general criteria for its selection or termination of providers. Disclosure 208
shall not be required of criteria deemed by the preferred provider 209
network to be of a proprietary or competitive nature that would hurt the 210
preferred provider network's ability to compete or to manage health 211
care services. For purposes of this section, criteria is of a proprietary or 212 Raised Bill No. 194
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competitive nature if it has the tendency to cause providers to alter their 213
practice pattern in a manner that would circumvent efforts to contain 214
health care costs and criteria is of a proprietary nature if revealing the 215
criteria would cause the preferred provider network's competitors to 216
obtain valuable business information. 217
(2) If a preferred provider network uses criteria that have not been 218
filed pursuant to subdivision (1) of this subsection to judge the quality 219
and cost-effectiveness of a provider's practice under any specific 220
program within the preferred provider network, the preferred provider 221
network may not reject or terminate the provider participating in that 222
program based upon such criteria until the provider has been informed 223
of the criteria that the provider's practice fails to meet. 224
(e) Each preferred provider network shall permit the Insurance 225
Commissioner to inspect its books and records. 226
(f) Each preferred provider network shall permit the commissioner to 227
examine, under oath, any officer or agent of the preferred provider 228
network or controlling company or organization with respect to the use 229
of the funds of the preferred provider network, company or 230
organization, and compliance with (1) the provisions of this part, and 231
(2) the terms and conditions of its contracts to provide health care 232
services. 233
(g) Each preferred provider network shall file with the commissioner 234
a notice of any material modification of any matter or document 235
furnished pursuant to this part, and shall include such supporting 236
documents as are necessary to explain the modification. 237
(h) Each preferred provider network shall maintain a minimum net 238
worth of either (1) the greater of (A) five hundred thousand dollars, or 239
(B) an amount equal to eight per cent of its annual expenditures as 240
reported on its most recent financial statement completed and filed with 241
the commissioner in accordance with sections 38a-53 and 38a-54, as 242
applicable, or (2) another amount determined by the commissioner. 243 Raised Bill No. 194
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(i) Each preferred provider network shall maintain or arrange for a 244
letter of credit, bond, surety, reinsurance, reserve or other financial 245
security acceptable to the commissioner for the exclusive use of paying 246
any outstanding amounts owed participating providers in the event of 247
insolvency or nonpayment except that any remaining security may be 248
used for the purpose of reimbursing managed care organizations in 249
accordance with subsection (b) of section 38a-479bb. Such outstanding 250
amount shall be at least an amount equal to the greater of (1) an amount 251
sufficient to make payments to participating providers for four months 252
determined on the basis of the four months within the past year with the 253
greatest amounts owed by the preferred provider network to 254
participating providers, (2) the actual outstanding amount owed by the 255
preferred provider network to participating providers, or (3) another 256
amount determined by the commissioner. Such amount may be credited 257
against the preferred provider network's minimum net worth 258
requirements set forth in subsection (h) of this section. The 259
commissioner shall review such security amount and calculation on a 260
quarterly basis. 261
(j) Each preferred provider network shall pay the applicable license 262
or renewal fee specified in section 38a-11. The commissioner shall use 263
the amount of such fees solely for the purpose of regulating preferred 264
provider networks. 265
(k) In no event, including, but not limited to, nonpayment by the 266
managed care organization, insolvency of the managed care 267
organization, or breach of contract between the managed care 268
organization and the preferred provider network, shall a preferred 269
provider network bill, charge, collect a deposit from, seek 270
compensation, remuneration or reimbursement from, or have any 271
recourse against an enrollee or an enrollee's designee, other than the 272
managed care organization, for covered benefits provided, except that 273
the preferred provider network may collect any copayments, 274
deductibles or other out-of-pocket expenses that the enrollee is required 275
to pay pursuant to the managed care plan. 276 Raised Bill No. 194
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(l) Each contract or agreement between a preferred provider network 277
and a participating provider shall contain a provision that if the 278
preferred provider network fails to pay for health care services as set 279
forth in the contract, the enrollee shall not be liable to the participating 280
provider for any sums owed by the preferred provider network or any 281
sums owed by the managed care organization because of nonpayment 282
by the managed care organization, insolvency of the managed care 283
organization or breach of contract between the managed care 284
organization and the preferred provider network. 285
(m) Each utilization review determination made by or on behalf of a 286
preferred provider network shall be made in accordance with section 287
38a-591d. 288
[(n) The requirements of subsections (h) and (i) of this section shall 289
not apply to a consortium of federally qualified health centers funded 290
by the state, providing services only to recipients of programs 291
administered by the Department of Social Services. The Commissioner 292
of Social Services shall adopt regulations, in accordance with chapter 54, 293
to establish criteria to certify any such federally qualified health center, 294
including, but not limited to, minimum reserve fund requirements.] 295
This act shall take effect as follows and shall amend the following
sections:
Section 1 July 1, 2020 17a-485d(c)
Sec. 2 July 1, 2020 17b-59a(b)
Sec. 3 July 1, 2020 17b-349(a)
Sec. 4 July 1, 2020 38a-479aa
Statement of Purpose:
To revise certain provisions in the general statutes containing obsolete
references to the Department of Social Services.
[Proposed deletions are enclosed in brackets. Proposed additions are indicated by underline, except
that when the entire text of a bill or resolution or a section of a bill or resolution is new, it is not
underlined.]