Connecticut 2022 Regular Session

Connecticut House Bill HB05042 Compare Versions

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Version 2 (New)

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7		-	General Assembly Substitute Bill No. 5042
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	9	+	General Assembly Governor's Bill No. 5042
8	10		February Session, 2022
	11	+	LCO No. 647
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	14	+	Referred to Committee on INSURANCE AND REAL ESTATE
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	17	+	Introduced by:
	18	+	Request of the Governor Pursuant
	19	+	to Joint Rule 9
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12	26		AN ACT CONCERNING HEALTH CARE COST GROWTH.
13	27		Be it enacted by the Senate and House of Representatives in General
14	28		Assembly convened:
15	29
16	30		Section 1. Section 19a-754a of the 2022 supplement to the general 1
17	31		statutes is repealed and the following is substituted in lieu thereof 2
18	32		(Effective from passage): 3
19	33		(a) There is established an Office of Health Strategy, which shall be 4
20	34		within the Department of Public Health for administrative purposes 5
21	35		only. The department head of said office shall be the executive director 6
22	36		of the Office of Health Strategy, who shall be appointed by the Governor 7
23	37		in accordance with the provisions of sections 4-5 to 4-8, inclusive, with 8
24	38		the powers and duties therein prescribed. 9
25	39		(b) The Office of Health Strategy shall be responsible for the 10
26	40		following: 11
27	41		(1) Developing and implementing a comprehensive and cohesive 12
28		-	health care vision for the state, including, but not limited to, a 13
	42	+	health care vision for the state, including, but not limited to, a 13 Governor's Bill No. 5042
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29	48		coordinated state health care cost containment strategy; 14
30	49		(2) Promoting effective health planning and the provision of quality 15
31	50		health care in the state in a manner that ensures access for all state 16
32	51		residents to cost-effective health care services, avoids the duplication of 17
33		-	such services and improves the availability and financial stability of 18 Substitute Bill No. 5042
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	52	+	such services and improves the availability and financial stability of 18
40	53		such services throughout the state; 19
41	54		(3) [Directing] (A) Developing, innovating, directing and overseeing 20
42	55		health care delivery and payment models in the state that reduce health 21
43	56		care cost growth and improve the quality of patient care, including, but 22
44	57		not limited to, the State Innovation Model Initiative and related 23
45	58		successor initiatives, (B) setting an annual health care cost growth 24
46		-	benchmark and primary care ~~spending~~ target pursuant to section 3 of 25
47		-	~~this act, (C)~~ developing and adopting health care quality benchmarks 26
48		-	~~pursuant to~~ section 3 of this act, (D) developing strategies, in 27
49		-	~~consultation with~~ stakeholders, to facilitate adherence with such 28
50		-	~~benchmarks and targets~~ developed pursuant to section 3 of this act, (E) 29
51		-	~~enhancing the~~ transparency of provider entities, as defined in 30
52		-	~~subdivision (13) of~~ section 2 of this act, (F) monitoring the development 31
53		-	~~of accountable care~~ organizations and patient-centered medical homes 32
54		-	~~in the state, and (G)~~ monitoring the adoption of alternative payment 33
55		-	~~methodologies in the~~ state; 34
	59	+	benchmark and primary care target pursuant to section 3 of this act, (C) 25
	60	+	developing and adopting health care quality benchmarks pursuant to 26
	61	+	section 3 of this act, (D) developing strategies, in consultation with 27
	62	+	stakeholders, to facilitate adherence with such benchmarks and targets 28
	63	+	developed pursuant to section 3 of this act, (E) enhancing the 29
	64	+	transparency of provider entities, as defined in subdivision (13) of 30
	65	+	section 2 of this act, (F) monitoring the development of accountable care 31
	66	+	organizations and patient-centered medical homes in the state, and (G) 32
	67	+	monitoring the adoption of alternative payment methodologies in the 33
	68	+	state; 34
56	69		(4) (A) Coordinating the state's health information technology 35
57	70		initiatives, (B) seeking funding for and overseeing the planning, 36
58	71		implementation and development of policies and procedures for the 37
59	72		administration of the all-payer claims database program established 38
60	73		under section 19a-775a, (C) establishing and maintaining a consumer 39
61	74		health information Internet web site under section 19a-755b, and (D) 40
62	75		designating an unclassified individual from the office to perform the 41
63	76		duties of a health information technology officer as set forth in sections 42
64	77		17b-59f and 17b-59g; 43
65	78		(5) Directing and overseeing the Health Systems Planning Unit 44
66		-	established under section 19a-612 and all of its duties and 45
	79	+	established under section 19a-612 and all of its duties and 45 Governor's Bill No. 5042
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67	85		responsibilities as set forth in chapter 368z; 46
68	86		(6) Convening forums and meetings with state government and 47
69	87		external stakeholders, including, but not limited to, the Connecticut 48
70	88		Health Insurance Exchange, to discuss health care issues designed to 49
71		-	develop effective health care cost and quality strategies; and 50 Substitute Bill No. 5042
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	89	+	develop effective health care cost and quality strategies; and 50
78	90		(7) (A) Administering the Covered Connecticut program established 51
79	91		under section 19a-754c in consultation with the Commissioner of Social 52
80	92		Services, Insurance Commissioner and Connecticut Health Insurance 53
81	93		Exchange, and (B) consulting with the Commissioner of Social Services 54
82	94		and Insurance Commissioner for the purposes set forth in section 17b-55
83	95		312. 56
84	96		(c) The Office of Health Strategy shall constitute a successor, in 57
85	97		accordance with the provisions of sections 4-38d, 4-38e and 4-39, to the 58
86	98		functions, powers and duties of the following: 59
87	99		(1) The Connecticut Health Insurance Exchange, established 60
88	100		pursuant to section 38a-1081, relating to the administration of the all-61
89	101		payer claims database pursuant to section 19a-755a; and 62
90	102		(2) The Office of the Lieutenant Governor, relating to the (A) 63
91	103		development of a chronic disease plan pursuant to section 19a-6q, (B) 64
92	104		housing, chairing and staffing of the Health Care Cabinet pursuant to 65
93	105		section 19a-725, and (C) (i) appointment of the health information 66
94	106		technology officer, and (ii) oversight of the duties of such health 67
95	107		information technology officer as set forth in sections 17b-59f and 17b-68
96	108		59g. 69
97	109		(d) Any order or regulation of the entities listed in subdivisions (1) 70
98	110		and (2) of subsection (c) of this section that is in force on July 1, 2018, 71
99	111		shall continue in force and effect as an order or regulation until 72
100	112		amended, repealed or superseded pursuant to law. 73
101	113		Sec. 2. (NEW) (Effective from passage) For the purposes of this section 74
102		-	and sections 3 to 7, inclusive, of this act: 75
	114	+	and sections 3 to 7, inclusive, of this act: 75 Governor's Bill No. 5042
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103	120		(1) "Drug manufacturer" means the manufacturer of a drug that is: 76
104	121		(A) Included in the information and data submitted by a health carrier 77
105	122		pursuant to section 38a-479qqq of the general statutes, (B) studied or 78
106	123		listed pursuant to subsection (c) or (d) of section 19a-754b of the general 79
107	124		statutes, or (C) in a therapeutic class of drugs that the executive director 80
108		-	determines, through public or private reports, has had a substantial 81 Substitute Bill No. 5042
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	125	+	determines, through public or private reports, has had a substantial 81
115	126		impact on prescription drug expenditures, net of rebates, as a 82
116	127		percentage of total health care expenditures; 83
117	128		(2) "Executive director" means the executive director of the office; 84
118	129		(3) "Health care cost growth benchmark" means the annual 85
119	130		benchmark established pursuant to section 3 of this act; 86
120	131		(4) "Health care quality benchmark" means an annual benchmark 87
121	132		established pursuant to section 3 of this act; 88
122	133		(5) "Health care provider" has the same meaning as provided in 89
123	134		subdivision (1) of subsection (a) of section 19a-17b of the general 90
124	135		statutes; 91
125	136		(6) "Net cost of private health insurance" means the difference 92
126	137		between premiums earned and benefits incurred, and includes insurers' 93
127	138		costs of paying bills, advertising, sales commissions, and other 94
128	139		administrative costs, net additions or subtractions from reserves, rate 95
129	140		credits and dividends, premium taxes, and profits or losses; 96
130	141		(7) "Office" means the Office of Health Strategy established under 97
131	142		section 19a-754a of the general statutes, as amended by this act; 98
132	143		(8) "Other entity" means a drug manufacturer, pharmacy benefits 99
133	144		manager, or other health care provider that is not considered a provider 100
134	145		entity; 101
135	146		(9) "Payer" means a payer, including Medicaid, Medicare and 102
136	147		governmental and nongovernment health plans, and includes any 103
137	148		organization acting as payer that is a subsidiary, affiliate or business 104
138		-	owned or controlled by a payer that, during a given calendar year, pays 105
	149	+	owned or controlled by a payer that, during a given calendar year, pays 105 Governor's Bill No. 5042
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139	155		health care providers for health care services or pharmacies or provider 106
140	156		entities for prescription drugs designated by the executive director; 107
141	157		(10) "Performance year" means the most recent calendar year for 108
142		-	which data were submitted for the applicable health care cost growth 109 Substitute Bill No. 5042
	158	+	which data were submitted for the applicable cost growth benchmark, 109
	159	+	primary care spend target or quality benchmark; 110
	160	+	(11) "Pharmacy benefits manager" has the same meaning as provided 111
	161	+	in subdivision (10) of section 38a-479ooo of the general statutes; 112
	162	+	(12) "Primary care target" means the annual target established 113
	163	+	pursuant to section 3 of this act; 114
	164	+	(13) "Provider entity" means an organized group of clinicians that 115
	165	+	come together for the purposes of contracting, or are an established 116
	166	+	billing unit that, at a minimum, includes primary care providers, and 117
	167	+	that collectively, during any given calendar year, has enough attributed 118
	168	+	lives to participate in total cost of care contracts, even if they are not 119
	169	+	engaged in a total cost of care contract; 120
	170	+	(14) "Potential gross state product" means a forecasted measure of the 121
	171	+	economy that equals the sum of the (A) expected growth in national 122
	172	+	labor force productivity, (B) expected growth in the state's labor force, 123
	173	+	and (C) expected national inflation, minus the expected state population 124
	174	+	growth; 125
	175	+	(15) "Total health care expenditures" means the sum of all health care 126
	176	+	expenditures in this state from public and private sources for a given 127
	177	+	calendar year, including: (A) All claims-based spending paid to 128
	178	+	providers, net of pharmacy rebates, (B) all patient cost-sharing amounts, 129
	179	+	and (C) the net cost of private health insurance; and 130
	180	+	(16) "Total medical expense" means the total cost of care for the 131
	181	+	patient population of a payer or provider entity for a given calendar 132
	182	+	year, where cost is calculated for such year as the sum of (A) all claims-133
	183	+	based spending paid to providers by public and private payers, and net 134
	184	+	of pharmacy rebates, (B) all nonclaims payments for such year, 135 Governor's Bill No. 5042
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149		-	benchmark, primary care spending target or health care quality 110
150		-	benchmark; 111
151		-	(11) "Pharmacy benefits manager" has the same meaning as provided 112
152		-	in subdivision (10) of section 38a-479ooo of the general statutes; 113
153		-	(12) "Primary care spending target" means the annual target 114
154		-	established pursuant to section 3 of this act; 115
155		-	(13) "Provider entity" means an organized group of clinicians that 116
156		-	come together for the purposes of contracting, or are an established 117
157		-	billing unit that, at a minimum, includes primary care providers, and 118
158		-	that collectively, during any given calendar year, has enough attributed 119
159		-	lives to participate in total cost of care contracts, even if they are not 120
160		-	engaged in a total cost of care contract; 121
161		-	(14) "Potential gross state product" means a forecasted measure of the 122
162		-	economy that equals the sum of the (A) expected growth in national 123
163		-	labor force productivity, (B) expected growth in the state's labor force, 124
164		-	and (C) expected national inflation, minus the expected state population 125
165		-	growth; 126
166		-	(15) "Total health care expenditures" means the sum of all health care 127
167		-	expenditures in this state from public and private sources for a given 128
168		-	calendar year, including: (A) All claims-based spending paid to 129
169		-	providers, net of pharmacy rebates, (B) all patient cost-sharing amounts, 130
170		-	and (C) the net cost of private health insurance; and 131
171		-	(16) "Total medical expense" means the total cost of care for the 132
172		-	patient population of a payer or provider entity for a given calendar 133
173		-	year, where cost is calculated for such year as the sum of (A) all claims-134
174		-	based spending paid to providers by public and private payers, and net 135
175		-	of pharmacy rebates, (B) all nonclaims payments for such year, 136
176		-	including, but not limited to, incentive payments and care coordination 137
177		-	payments, and (C) all patient cost-sharing amounts expressed on a per 138
178		-	capita basis for the patient population of a payer or provider entity in 139
179		-	this state. 140 Substitute Bill No. 5042
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	190	+	including, but not limited to, incentive payments and care coordination 136
	191	+	payments, and (C) all patient cost-sharing amounts expressed on a per 137
	192	+	capita basis for the patient population of a payer or provider entity in 138
	193	+	this state. 139
	194	+	Sec. 3. (NEW) (Effective from passage) (a) Not later than July 1, 2022, 140
	195	+	the executive director shall publish (1) the health care cost growth 141
	196	+	benchmarks and annual primary care spending targets as a percentage 142
	197	+	of total medical expenses for the calendar years 2021 to 2025, inclusive, 143
	198	+	and (2) the annual health care quality benchmarks for the calendar years 144
	199	+	2022 to 2025, inclusive, on the office's Internet web site. 145
	200	+	(b) (1) (A) Not later than July 1, 2025, and every five years thereafter, 146
	201	+	the executive director shall develop and adopt annual health care cost 147
	202	+	growth benchmarks and annual primary care spending targets for the 148
	203	+	succeeding five calendar years for provider entities and payers. 149
	204	+	(B) In developing the health care cost growth benchmarks and 150
	205	+	primary care spending targets pursuant to this subdivision, the 151
	206	+	executive director shall consider (i) any historical and forecasted 152
	207	+	changes in median income for individuals in the state and the growth 153
	208	+	rate of potential gross state product, (ii) the rate of inflation, and (iii) the 154
	209	+	most recent report, if any, prepared by the executive director pursuant 155
	210	+	to subsection (b) of section 4 of this act. 156
	211	+	(C) (i) The executive director may hold informational public hearings 157
	212	+	concerning the benchmarks and targets set pursuant to subsection (a) or 158
	213	+	subdivision (1) of subsection (b) of this section. Such informational 159
	214	+	public hearings shall be held at a time and place designated by the 160
	215	+	executive director in a notice prominently posted by the executive 161
	216	+	director on the office's Internet web site and in a form and manner 162
	217	+	prescribed by the executive director. 163
	218	+	(ii) If the executive director determines, after any informational 164
	219	+	public hearing held pursuant to this subparagraph, that a modification 165
	220	+	to any health care cost growth benchmark or annual primary care 166
	221	+	spending target is, in the executive director's discretion, reasonably 167 Governor's Bill No. 5042
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186		-	Sec. 3. (NEW) (Effective from passage) (a) Not later than July 1, 2022, 141
187		-	the executive director shall publish (1) the health care cost growth 142
188		-	benchmarks and annual primary care spending targets as a percentage 143
189		-	of total medical expenses for the calendar years 2021 to 2025, inclusive, 144
190		-	and (2) the annual health care quality benchmarks for the calendar years 145
191		-	2022 to 2025, inclusive, on the office's Internet web site. 146
192		-	(b) (1) (A) Not later than July 1, 2025, and every five years thereafter, 147
193		-	the executive director shall develop and adopt annual health care cost 148
194		-	growth benchmarks and annual primary care spending targets for the 149
195		-	succeeding five calendar years for provider entities and payers. 150
196		-	(B) In developing the health care cost growth benchmarks and 151
197		-	primary care spending targets pursuant to this subdivision, the 152
198		-	executive director shall consider (i) any historical and forecasted 153
199		-	changes in median income for individuals in the state and the growth 154
200		-	rate of potential gross state product, (ii) the rate of inflation, and (iii) the 155
201		-	most recent report, if any, prepared by the executive director pursuant 156
202		-	to subsection (b) of section 4 of this act. 157
203		-	(C) (i) The executive director may hold informational public hearings 158
204		-	concerning the benchmarks and targets set pursuant to subsection (a) or 159
205		-	subdivision (1) of subsection (b) of this section. Such informational 160
206		-	public hearings shall be held at a time and place designated by the 161
207		-	executive director in a notice prominently posted by the executive 162
208		-	director on the office's Internet web site and in a form and manner 163
209		-	prescribed by the executive director. 164
210		-	(ii) If the executive director determines, after any informational 165
211		-	public hearing held pursuant to this subparagraph, that a modification 166
212		-	to any health care cost growth benchmark or annual primary care 167
213		-	spending target is, in the executive director's discretion, reasonably 168
214		-	warranted, the executive director may modify such benchmark or 169
215		-	target. 170
216		-	(iii) If the executive director determines that the rate of inflation 171 Substitute Bill No. 5042
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	227	+	warranted, the executive director may modify such benchmark or 168
	228	+	target. 169
	229	+	(iii) If the executive director determines that the rate of inflation 170
	230	+	requires modification of any health care cost growth benchmark 171
	231	+	adopted under this section, the executive director may modify such 172
	232	+	benchmark. In such event, the executive director shall not be required 173
	233	+	to hold an informational public hearing concerning such modified 174
	234	+	health care cost growth benchmark. 175
	235	+	(D) The executive director shall post each adopted health care cost 176
	236	+	growth benchmark and annual primary care spending target on the 177
	237	+	office's Internet web site. 178
	238	+	(2) (A) Not later than July 1, 2025, and every five years thereafter, the 179
	239	+	executive director shall develop and adopt annual health care quality 180
	240	+	benchmarks for the succeeding five calendar years for provider entities 181
	241	+	and payers. 182
	242	+	(B) In developing annual health care quality benchmarks pursuant to 183
	243	+	this subdivision, the executive director shall consider (i) quality 184
	244	+	measures endorsed by nationally recognized organizations, including, 185
	245	+	but not limited to, the National Quality Forum, the National Committee 186
	246	+	for Quality Assurance, the Centers for Medicare and Medicaid Services, 187
	247	+	the Centers for Disease Control, the Joint Commission and expert 188
	248	+	organizations that develop health equity measures, and (ii) measures 189
	249	+	that: (I) Concern health outcomes, overutilization, underutilization and 190
	250	+	patient safety, (II) meet standards of patient-centeredness and ensure 191
	251	+	consideration of differences in preferences and clinical characteristics 192
	252	+	within patient subpopulations, and (III) concern community health or 193
	253	+	population health. 194
	254	+	(C) (i) The executive director may hold informational public hearings 195
	255	+	concerning the quality measures the executive director proposes to 196
	256	+	adopt as health care quality benchmarks. Such informational public 197
	257	+	hearings shall be held at a time and place designated by the executive 198
	258	+	director in a notice prominently posted by the executive director on the 199 Governor's Bill No. 5042
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223		-	requires modification of any health care cost growth benchmark 172
224		-	adopted under this section, the executive director may modify such 173
225		-	benchmark. In such event, the executive director shall not be required 174
226		-	to hold an informational public hearing concerning such modified 175
227		-	health care cost growth benchmark. 176
228		-	(D) The executive director shall post each adopted health care cost 177
229		-	growth benchmark and annual primary care spending target on the 178
230		-	office's Internet web site. 179
231		-	(2) (A) Not later than July 1, 2025, and every five years thereafter, the 180
232		-	executive director shall develop and adopt annual health care quality 181
233		-	benchmarks for the succeeding five calendar years for provider entities 182
234		-	and payers. 183
235		-	(B) In developing annual health care quality benchmarks pursuant to 184
236		-	this subdivision, the executive director shall consider (i) quality 185
237		-	measures endorsed by nationally recognized organizations, including, 186
238		-	but not limited to, the National Quality Forum, the National Committee 187
239		-	for Quality Assurance, the Centers for Medicare and Medicaid Services, 188
240		-	the Centers for Disease Control, the Joint Commission and expert 189
241		-	organizations that develop health equity measures, and (ii) measures 190
242		-	that: (I) Concern health outcomes, overutilization, underutilization and 191
243		-	patient safety, (II) meet standards of patient-centeredness and ensure 192
244		-	consideration of differences in preferences and clinical characteristics 193
245		-	within patient subpopulations, and (III) concern community health or 194
246		-	population health. 195
247		-	(C) (i) The executive director may hold informational public hearings 196
248		-	concerning the quality measures the executive director proposes to 197
249		-	adopt as health care quality benchmarks. Such informational public 198
250		-	hearings shall be held at a time and place designated by the executive 199
251		-	director in a notice prominently posted by the executive director on the 200
252		-	office's Internet web site and in a form and manner prescribed by the 201
253		-	executive director. 202 Substitute Bill No. 5042
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	264	+	office's Internet web site and in a form and manner prescribed by the 200
	265	+	executive director. 201
	266	+	(ii) If the executive director determines, after any informational 202
	267	+	public hearing held pursuant to this subparagraph, that modifications 203
	268	+	to any quality benchmarks are, in the executive director's discretion, 204
	269	+	reasonably warranted, the executive director may modify such quality 205
	270	+	benchmarks. The executive director shall not be required to hold an 206
	271	+	additional informational public hearing concerning such modified 207
	272	+	quality benchmarks. 208
	273	+	(D) The executive director shall post each adopted health care quality 209
	274	+	benchmark on the office's Internet web site. 210
	275	+	(c) The executive director may enter into such contractual agreements 211
	276	+	as may be necessary to carry out the purposes of this section, including, 212
	277	+	but not limited to, contractual agreements with actuarial, economic and 213
	278	+	other experts and consultants. 214
	279	+	Sec. 4. (NEW) (Effective from passage) (a) Not later than August 15, 215
	280	+	2022, and annually thereafter, each payer shall report to the executive 216
	281	+	director, in a form and manner prescribed by the executive director, for 217
	282	+	the preceding or prior years, if the executive director so requests based 218
	283	+	on material changes to data previously submitted, aggregated data, 219
	284	+	including aggregated self-funded data as applicable, necessary for the 220
	285	+	executive director to calculate total health care expenditures, primary 221
	286	+	care spending as a percentage of total medical expenses and net cost of 222
	287	+	private health insurance. Each payer shall also disclose, as requested by 223
	288	+	the executive director, payer data required for adjusting total medical 224
	289	+	expense calculations to reflect changes in the patient population. 225
	290	+	(b) Not later than March 31, 2023, and annually thereafter, the 226
	291	+	executive director shall prepare and post on the office's Internet web 227
	292	+	site, a report concerning the total health care expenditures utilizing the 228
	293	+	total aggregate medical expenses reported by payers pursuant to 229
	294	+	subsection (a) of this section, including, but not limited to, a breakdown 230
	295	+	of such population-adjusted total medical expenses by payer and 231 Governor's Bill No. 5042
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260		-	~~(ii) If the executive director determines,~~ ~~after any informational 203~~
261		-	~~public hearing held pursuant to this subparagraph, that modifications 204~~
262		-	~~to any health care quality benchmarks are, in~~ the ~~executive director's 205~~
263		-	~~discretion, reasonably warranted,~~ the ~~executive director may modify 206~~
264		-	~~such quality benchmarks.~~ ~~The executive director shall not be required 207~~
265		-	~~to hold an additional informational public hearing concerning such 208~~
266		-	~~modified quality benchmarks. 209~~
267		-	(D) The ~~executive director shall post each adopted~~ health ~~care quality 210~~
268		-	~~benchmark on the office's Internet web site.~~ ~~211~~
269		-	~~(c) The executive director may enter into such contractual agreements 212~~
270		-	~~as may be necessary~~ to ~~carry out~~ the ~~purposes of this section, including, 213~~
271		-	~~but not limited to, contractual agreements with actuarial, economic~~ and ~~214~~
272		-	~~other experts and consultants~~. ~~215~~
273		-	~~Sec. 4.~~ (~~NEW) (Effective from passage) (a~~) Not later than August 15, ~~216~~
274		-	~~2022, and annually thereafter, each payer~~ shall report to the executive ~~217~~
275		-	~~director, in a form~~ and manner prescribed by the executive director, for ~~218~~
276		-	~~the preceding or~~ prior years, if the executive director so requests based ~~219~~
277		-	~~on material~~ changes to data previously submitted, ~~aggregated data,~~ ~~220~~
278		-	~~including aggregated self-funded~~ ~~data as applicable,~~ ~~necessary for the 221~~
279		-	~~executive director to calculate total health care expenditures~~, ~~primary 222~~
280		-	~~care spending as a percentage of total medical expenses~~ and ~~net cost of 223~~
281		-	~~private~~ health ~~insurance. Each payer shall also disclose, as requested~~ by ~~224~~
282		-	~~the executive director,~~ ~~payer data required for adjusting total medical 225~~
283		-	~~expense calculations to reflect changes in~~ the ~~patient population.~~ ~~226~~
284		-	~~(b) Not later than March 31,~~ ~~2023, and annually thereafter,~~ the ~~227~~
285		-	~~executive director shall prepare~~ and ~~post on the office's Internet web 228~~
286		-	~~site, a report concerning the total health care expenditures utilizing the 229~~
287		-	~~total aggregate medical expenses reported by payers pursuant to 230~~
288		-	~~subsection (a) of this section~~, ~~including~~, ~~but~~ not ~~limited to, a breakdown 231~~
289		-	of such ~~population-adjusted total medical expenses by~~ payer ~~and 232~~
290		-	~~provider entities.~~ The ~~report may include,~~ ~~but shall not be limited~~ to~~, 233~~
291		-	~~information regarding~~ the ~~following: 234 Substitute~~ Bill No. 5042
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	301	+	provider entities. The report may include, but shall not be limited to, 232
	302	+	information regarding the following: 233
	303	+	(1) Trends in major service category spending; 234
	304	+	(2) Primary care spending as a percentage of total medical expenses; 235
	305	+	and 236
	306	+	(3) The net cost of private health insurance by payer by market 237
	307	+	segment, including individual, small group, large group, self-insured, 238
	308	+	student and Medicare Advantage markets. 239
	309	+	(c) The executive director shall annually submit a request to the 240
	310	+	federal Centers for Medicare and Medicaid Services for the unadjusted 241
	311	+	total medical expenses of Connecticut residents. 242
	312	+	(d) Not later than August 15, 2023, and annually thereafter, each 243
	313	+	payer or provider entity shall report to the executive director in a form 244
	314	+	and manner prescribed by the executive director, for the preceding year, 245
	315	+	and for prior years if the executive director so requests based on material 246
	316	+	changes to data previously submitted, on the health care quality 247
	317	+	benchmarks adopted pursuant to section 3 of this act. 248
	318	+	(e) Not later than March 31, 2024, and annually thereafter, the 249
	319	+	executive director shall prepare and post on the office's Internet web 250
	320	+	site, a report concerning health care quality benchmarks reported by 251
	321	+	payers and provider entities pursuant to subsection (d) of this section. 252
	322	+	(f) The executive director may enter into such contractual agreements 253
	323	+	as may be necessary to carry out the purposes of this section, including, 254
	324	+	but not limited to, contractual agreements with actuarial, economic and 255
	325	+	other experts and consultants. 256
	326	+	Sec. 5. (NEW) (Effective from passage) (a) (1) For each calendar year, 257
	327	+	beginning on January 1, 2023, the executive director shall identify, not 258
	328	+	later than May first of such calendar year, each payer or provider entity 259
	329	+	that exceeded the health care cost growth benchmark or failed to meet 260
	330	+	the primary care spending target for the performance year. For each 261 Governor's Bill No. 5042
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298		-	(1) Trends in major service category spending; 235
299		-	(2) Primary care spending as a percentage of total medical expenses; 236
300		-	and 237
301		-	(3) The net cost of private health insurance by payer by market 238
302		-	segment, including individual, small group, large group, self-insured, 239
303		-	student and Medicare Advantage markets. 240
304		-	(c) The executive director shall annually submit a request to the 241
305		-	federal Centers for Medicare and Medicaid Services for the unadjusted 242
306		-	total medical expenses of Connecticut residents. 243
307		-	(d) Not later than August 15, 2023, and annually thereafter, each 244
308		-	payer or provider entity shall report to the executive director in a form 245
309		-	and manner prescribed by the executive director, for the preceding year, 246
310		-	and for prior years if the executive director so requests based on material 247
311		-	changes to data previously submitted, on the health care quality 248
312		-	benchmarks adopted pursuant to section 3 of this act. 249
313		-	(e) Not later than March 31, 2024, and annually thereafter, the 250
314		-	executive director shall prepare and post on the office's Internet web 251
315		-	site, a report concerning health care quality benchmarks reported by 252
316		-	payers and provider entities pursuant to subsection (d) of this section. 253
317		-	(f) The executive director may enter into such contractual agreements 254
318		-	as may be necessary to carry out the purposes of this section, including, 255
319		-	but not limited to, contractual agreements with actuarial, economic and 256
320		-	other experts and consultants. 257
321		-	Sec. 5. (NEW) (Effective from passage) (a) (1) For each calendar year, 258
322		-	beginning on January 1, 2023, the executive director shall identify, not 259
323		-	later than May first of such calendar year, each payer or provider entity 260
324		-	that exceeded the health care cost growth benchmark or failed to meet 261
325		-	the primary care spending target for the performance year. For each 262
326		-	calendar year beginning on or after January 1, 2024, the executive 263
327		-	director shall identify, not later than May first of such calendar year, 264 Substitute Bill No. 5042
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	336	+	calendar year beginning on or after January 1, 2024, the executive 262
	337	+	director shall identify, not later than May first of such calendar year, 263
	338	+	each payer or provider entity that failed to meet the health care quality 264
	339	+	benchmarks for the performance year. 265
	340	+	(2) Not later than thirty days after the executive director identifies 266
	341	+	each payer or provider entity pursuant to subsection (a) of this section, 267
	342	+	the executive director shall send a notice to each such payer or provider 268
	343	+	entity. Such notice shall be in a form and manner prescribed by the 269
	344	+	executive director, and shall disclose to each such payer or provider 270
	345	+	entity: 271
	346	+	(A) That the executive director has identified such payer or provider 272
	347	+	entity pursuant to subdivision (1) of this subsection; and 273
	348	+	(B) The factual basis for the executive director's identification of such 274
	349	+	payer or provider entity pursuant to subdivision (1) of this subsection. 275
	350	+	(b) (1) For each calendar year beginning on and after January 1, 2023, 276
	351	+	if the executive director determines that the annual percentage change 277
	352	+	in total health care expenditures for the performance year exceeded the 278
	353	+	health care cost growth benchmark for such year, the executive director 279
	354	+	shall identify, not later than May first of such calendar year, any other 280
	355	+	entity that significantly contributed to exceeding such benchmark. Each 281
	356	+	identification shall be based on: 282
	357	+	(A) The report, if any, prepared by the executive director pursuant to 283
	358	+	subsection (b) of section 4 of this act for such calendar year; 284
	359	+	(B) The report filed pursuant to section 38a-479ppp of the general 285
	360	+	statutes for such calendar year; 286
	361	+	(C) The information and data reported to the office pursuant to 287
	362	+	subsection (d) of section 19a-754b of the general statutes for such 288
	363	+	calendar year; 289
	364	+	(D) Information obtained from the all-payer claims database 290
	365	+	established under section 19a-755a of the general statutes; and 291 Governor's Bill No. 5042
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334		-	each payer or provider entity that failed to meet the health care quality 265
335		-	benchmarks for the performance year. 266
336		-	(2) Not later than thirty days after the executive director identifies 267
337		-	each payer or provider entity pursuant to subsection (a) of this section, 268
338		-	the executive director shall send a notice to each such payer or provider 269
339		-	entity. Such notice shall be in a form and manner prescribed by the 270
340		-	executive director, and shall disclose to each such payer or provider 271
341		-	entity: 272
342		-	(A) That the executive director has identified such payer or provider 273
343		-	entity pursuant to subdivision (1) of this subsection; and 274
344		-	(B) The factual basis for the executive director's identification of such 275
345		-	payer or provider entity pursuant to subdivision (1) of this subsection. 276
346		-	(b) (1) For each calendar year beginning on and after January 1, 2023, 277
347		-	if the executive director determines that the annual percentage change 278
348		-	in total health care expenditures for the performance year exceeded the 279
349		-	health care cost growth benchmark for such year, the executive director 280
350		-	shall identify, not later than May first of such calendar year, any other 281
351		-	entity that significantly contributed to exceeding such benchmark. Each 282
352		-	identification shall be based on: 283
353		-	(A) The report, if any, prepared by the executive director pursuant to 284
354		-	subsection (b) of section 4 of this act for such calendar year; 285
355		-	(B) The report filed pursuant to section 38a-479ppp of the general 286
356		-	statutes for such calendar year; 287
357		-	(C) The information and data reported to the office pursuant to 288
358		-	subsection (d) of section 19a-754b of the general statutes for such 289
359		-	calendar year; 290
360		-	(D) Information obtained from the all-payer claims database 291
361		-	established under section 19a-755a of the general statutes; and 292 Substitute Bill No. 5042
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	370	+
	371	+	(E) Any other information that the executive director, in the executive 292
	372	+	director's discretion, deems relevant for the purposes of this section. 293
	373	+	(2) The executive director shall account for costs, net of rebates and 294
	374	+	discounts, when identifying other entities pursuant to this section. 295
	375	+	Sec. 6. (NEW) (Effective from passage) (a) (1) Not later than June 30, 296
	376	+	2023, and annually thereafter, the executive director shall hold an 297
	377	+	informational public hearing to compare the growth in total health care 298
	378	+	expenditures in the performance year to the health care cost growth 299
	379	+	benchmark established pursuant to section 3 of this act for such year. 300
	380	+	Such hearing shall involve an examination of: 301
	381	+	(A) The report, if any, most recently prepared by the executive 302
	382	+	director pursuant to subsection (b) of section 4 of this act; 303
	383	+	(B) The expenditures of provider entities and payers, including, but 304
	384	+	not limited to, health care cost trends, primary care spending as a 305
	385	+	percentage of total medical expenses and the factors contributing to 306
	386	+	such costs and expenditures; and 307
	387	+	(C) Any other matters that the executive director, in the executive 308
	388	+	director's discretion, deems relevant for the purposes of this section. 309
	389	+	(2) The executive director may require any payer or provider entity 310
	390	+	that, for the performance year, is found to be a significant contributor to 311
	391	+	health care cost growth in the state or has failed to meet the primary care 312
	392	+	spending target, to participate in such hearing. Each such payer or 313
	393	+	provider entity that is required to participate in such hearing shall 314
	394	+	provide testimony on issues identified by the executive director and 315
	395	+	provide additional information on actions taken to reduce such payer's 316
	396	+	or entity's contribution to future state-wide health care costs and 317
	397	+	expenditures or to increase such payer's or provider entity's primary 318
	398	+	care spending as a percentage of total medical expenses. 319
	399	+	(3) The executive director may require that any other entity that is 320
	400	+	found to be a significant contributor to health care cost growth in this 321 Governor's Bill No. 5042
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368		-	(E) Any other information that the executive director, in the executive 293
369		-	director's discretion, deems relevant for the purposes of this section. 294
370		-	(2) The executive director shall account for costs, net of rebates and 295
371		-	discounts, when identifying other entities pursuant to this section. 296
372		-	Sec. 6. (NEW) (Effective from passage) (a) (1) Not later than June 30, 297
373		-	2023, and annually thereafter, the executive director shall hold an 298
374		-	informational public hearing to compare the growth in total health care 299
375		-	expenditures in the performance year to the health care cost growth 300
376		-	benchmark established pursuant to section 3 of this act for such year. 301
377		-	Such hearing shall involve an examination of: 302
378		-	(A) The report, if any, most recently prepared by the executive 303
379		-	director pursuant to subsection (b) of section 4 of this act; 304
380		-	(B) The expenditures of provider entities and payers, including, but 305
381		-	not limited to, health care cost trends, primary care spending as a 306
382		-	percentage of total medical expenses and the factors contributing to 307
383		-	such costs and expenditures; and 308
384		-	(C) Any other matters that the executive director, in the executive 309
385		-	director's discretion, deems relevant for the purposes of this section. 310
386		-	(2) The executive director may require any payer or provider entity 311
387		-	that, for the performance year, is found to be a significant contributor to 312
388		-	health care cost growth in the state or has failed to meet the primary care 313
389		-	spending target, to participate in such hearing. Each such payer or 314
390		-	provider entity that is required to participate in such hearing shall 315
391		-	provide testimony on issues identified by the executive director and 316
392		-	provide additional information on actions taken to reduce such payer's 317
393		-	or entity's contribution to future state-wide health care costs and 318
394		-	expenditures or to increase such payer's or provider entity's primary 319
395		-	care spending as a percentage of total medical expenses. 320
396		-	(3) The executive director may require that any other entity that is 321
397		-	found to be a significant contributor to health care cost growth in this 322 Substitute Bill No. 5042
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	405	+
	406	+	state during the performance year participate in such hearing. Any other 322
	407	+	entity that is required to participate in such hearing shall provide 323
	408	+	testimony on issues identified by the executive director and provide 324
	409	+	additional information on actions taken to reduce such other entity's 325
	410	+	contribution to future state-wide health care costs. If such other entity is 326
	411	+	a drug manufacturer, and the executive director requires that such drug 327
	412	+	manufacturer participate in such hearing with respect to a specific drug 328
	413	+	or class of drugs, such hearing may, to the extent possible, include 329
	414	+	representatives from at least one brand-name manufacturer, one generic 330
	415	+	manufacturer and one innovator company that is less than ten years old. 331
	416	+	(4) Not later than October 15, 2023, and annually thereafter, the 332
	417	+	executive director shall prepare and submit a report, in accordance with 333
	418	+	section 11-4a of the general statutes, to the joint standing committees of 334
	419	+	the General Assembly having cognizance of matters relating to 335
	420	+	insurance and public health. Such report shall be based on the executive 336
	421	+	director's analysis of the information submitted during the most recent 337
	422	+	informational public hearing conducted pursuant to this subsection and 338
	423	+	any other information that the executive director, in the executive 339
	424	+	director's discretion, deems relevant for the purposes of this section, and 340
	425	+	shall: 341
	426	+	(A) Describe health care spending trends in this state, including, but 342
	427	+	not limited to, trends in primary care spending as a percentage of total 343
	428	+	medical expense, and the factors underlying such trends; and 344
	429	+	(B) Disclose the executive director's recommendations, if any, 345
	430	+	concerning strategies to increase the efficiency of the state's health care 346
	431	+	system, including, but not limited to, any recommended legislation 347
	432	+	concerning the state's health care system. 348
	433	+	(b) (1) Not later than June 30, 2024, and annually thereafter, the 349
	434	+	executive director shall hold an informational public hearing to 350
	435	+	compare the performance of payers and provider entities in the 351
	436	+	performance year to the quality benchmarks established for such year 352
	437	+	pursuant to section 3 of this act. Such hearing shall include an 353 Governor's Bill No. 5042
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404		-	~~state during the performance year participate in such hearing~~. ~~Any other 323~~
405		-	~~entity that is required to participate in such hearing shall provide 324~~
406		-	~~testimony on issues identified by the executive director and provide 325~~
407		-	~~additional information on actions taken to reduce such other entity's 326~~
408		-	~~contribution~~ to ~~future state-wide~~ ~~health care costs.~~ ~~If such other entity is 327~~
409		-	~~a drug manufacturer,~~ ~~and~~ the executive director ~~requires that such drug 328~~
410		-	~~manufacturer participate in such hearing with respect to a specific drug 329~~
411		-	~~or class of drugs, such hearing may, to~~ the ~~extent possible,~~ ~~include 330~~
412		-	~~representatives from at least one brand-name~~ ~~manufacturer, one generic 331~~
413		-	~~manufacturer and one innovator company that is less than ten years old~~. ~~332~~
414		-	~~(4) Not later than October 15,~~ ~~2023, and annually thereafter,~~ ~~the 333~~
415		-	executive director ~~shall prepare and submit a report, in accordance with 334~~
416		-	~~section 11-4a~~ ~~of the general statutes,~~ to ~~the joint standing committees of 335~~
417		-	~~the General Assembly having cognizance of matters relating to 336~~
418		-	~~insurance~~ and ~~public health. Such report shall be based on~~ the ~~executive 337~~
419		-	director~~'s analysis of the information submitted during the most recent 338~~
420		-	~~informational public hearing conducted pursuant~~ to ~~this subsection and 339~~
421		-	~~any other information that~~ the ~~executive director,~~ ~~in the executive 340~~
422		-	~~director's discretion,~~ ~~deems relevant for~~ the ~~purposes of this section, and 341~~
423		-	~~shall: 342~~
424		-	~~(A) Describe health care spending trends in~~ this ~~state, including,~~ ~~but 343~~
425		-	~~not limited to~~, ~~trends~~ in ~~primary care spending as a percentage of total 344~~
426		-	~~medical expense~~, and ~~the factors underlying such trends; and 345~~
427		-	~~(B) Disclose the executive director's recommendations, if any, 346~~
428		-	~~concerning strategies to increase the efficiency of the state's~~ health care ~~347~~
429		-	~~system, including,~~ ~~but not limited to, any recommended legislation 348~~
430		-	~~concerning~~ the ~~state~~'s ~~health care system.~~ ~~349~~
431		-	~~(b) (1) Not later than June 30, 2024, and annually thereafter,~~ the ~~350~~
432		-	~~executive director shall hold an informational public hearing~~ to ~~351~~
433		-	~~compare~~ the ~~performance of payers and provider entities in the 352~~
434		-	~~performance year to~~ the ~~quality benchmarks established for such year 353~~
435		-	~~pursuant to section 3~~ of ~~this act.~~ ~~Such hearing shall include an 354 Substitute~~ Bill No. 5042
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	443	+	examination of: 354
	444	+	(A) The report, if any, most recently prepared by the executive 355
	445	+	director pursuant to subsection (e) of section 4 of this act; and 356
	446	+	(B) Any other matters that the executive director, in the executive 357
	447	+	director's discretion, deems relevant for the purposes of this section. 358
	448	+	(2) The executive director may require any payer or provider entity 359
	449	+	that failed to meet any health care quality benchmarks in this state 360
	450	+	during the performance year to participate in such hearing. Each such 361
	451	+	payer or provider entity that is required to participate in such hearing 362
	452	+	shall provide testimony on issues identified by the executive director 363
	453	+	and provide additional information on actions taken to improve such 364
	454	+	payer's or provider entity's quality benchmark performance. 365
	455	+	(3) Not later than October 15, 2024, and annually thereafter, the 366
	456	+	executive director shall prepare and submit a report, in accordance with 367
	457	+	section 11-4a of the general statutes, to the joint standing committees of 368
	458	+	the General Assembly having cognizance of matters relating to 369
	459	+	insurance and public health. Such report shall be based on the executive 370
	460	+	director's analysis of the information submitted during the most recent 371
	461	+	informational public hearing conducted pursuant to this subsection and 372
	462	+	any other information that the executive director, in the executive 373
	463	+	director's discretion, deems relevant for the purposes of this section, and 374
	464	+	shall: 375
	465	+	(A) Describe health care quality trends in this state and the factors 376
	466	+	underlying such trends; and 377
	467	+	(B) Disclose the executive director's recommendations, if any, 378
	468	+	concerning strategies to improve the quality of the state's health care 379
	469	+	system, including, but not limited to, any recommended legislation 380
	470	+	concerning the state's health care system. 381
	471	+	Sec. 7. (NEW) (Effective from passage) The executive director may 382
	472	+	adopt regulations, in accordance with chapter 54 of the general statutes, 383 Governor's Bill No. 5042
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442		-	examination of: 355
443		-	(A) The report, if any, most recently prepared by the executive 356
444		-	director pursuant to subsection (e) of section 4 of this act; and 357
445		-	(B) Any other matters that the executive director, in the executive 358
446		-	director's discretion, deems relevant for the purposes of this section. 359
447		-	(2) The executive director may require any payer or provider entity 360
448		-	that failed to meet any health care quality benchmarks in this state 361
449		-	during the performance year to participate in such hearing. Each such 362
450		-	payer or provider entity that is required to participate in such hearing 363
451		-	shall provide testimony on issues identified by the executive director 364
452		-	and provide additional information on actions taken to improve such 365
453		-	payer's or provider entity's quality benchmark performance. 366
454		-	(3) Not later than October 15, 2024, and annually thereafter, the 367
455		-	executive director shall prepare and submit a report, in accordance with 368
456		-	section 11-4a of the general statutes, to the joint standing committees of 369
457		-	the General Assembly having cognizance of matters relating to 370
458		-	insurance and public health. Such report shall be based on the executive 371
459		-	director's analysis of the information submitted during the most recent 372
460		-	informational public hearing conducted pursuant to this subsection and 373
461		-	any other information that the executive director, in the executive 374
462		-	director's discretion, deems relevant for the purposes of this section, and 375
463		-	shall: 376
464		-	(A) Describe health care quality trends in this state and the factors 377
465		-	underlying such trends; and 378
466		-	(B) Disclose the executive director's recommendations, if any, 379
467		-	concerning strategies to improve the quality of the state's health care 380
468		-	system, including, but not limited to, any recommended legislation 381
469		-	concerning the state's health care system. 382
470		-	Sec. 7. (NEW) (Effective from passage) The executive director may 383
471		-	adopt regulations, in accordance with chapter 54 of the general statutes, 384 Substitute Bill No. 5042
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478		-	to implement the provisions of section 19a-754a of the general statutes, 385
479		-	as amended by this act, and sections 2 to 6, inclusive, of this act. 386
	478	+	to implement the provisions of section 19a-754a of the general statutes, 384
	479	+	as amended by this act, and sections 2 to 6, inclusive, of this act. 385
480	480		This act shall take effect as follows and shall amend the following
481	481		sections:
482	482
483	483		Section 1 from passage 19a-754a
484	484		Sec. 2 from passage New section
485	485		Sec. 3 from passage New section
486	486		Sec. 4 from passage New section
487	487		Sec. 5 from passage New section
488	488		Sec. 6 from passage New section
489	489		Sec. 7 from passage New section
490	490
491		-	Statement of Legislative Commissioners:
492		-	In Section 1(b)(3), "primary care target" was changed to "primary care
493		-	spending target" for consistency; in Section 2(10), "cost growth
494		-	benchmark" was changed to "health care cost growth benchmark",
495		-	"primary care spend target" was changed to "primary care spending
496		-	target", and "quality benchmark" was changed to "health care quality
497		-	benchmark" for consistency; in Section 2(12), "Primary care target" was
498		-	changed to "Primary care spending target" for consistency; and in
499		-	Section 3(b)(2)(C)(ii), "quality benchmarks" was changed to "health care
500		-	quality benchmarks" for consistency.
501		-
502		-
503		-	INS Joint Favorable Subst. -LCO
	491	+	Statement of Purpose:
	492	+	To implement the Governor's budget recommendations.
	493	+	[Proposed deletions are enclosed in brackets. Proposed additions are indicated by underline, except
	494	+	that when the entire text of a bill or resolution or a section of a bill or resolution is new, it is not
	495	+	underlined.]
504	496