This docum ent does not reflect the intent or official position of the bill sponsor or House of Representatives.
STORAGE NAME: h1325.FFS
DATE: 2/15/2022
HOUSE OF REPRESENTATIVES STAFF ANALYSIS
BILL #: HB 1325 Health Care Cost Savings
SPONSOR(S): Fernandez-Barquin
TIED BILLS: IDEN./SIM. BILLS: SB 252
REFERENCE ACTION ANALYST STAFF DIRECTOR or
BUDGET/POLICY CHIEF
1) Finance & Facilities Subcommittee Poche Lloyd
2) Health & Human Services Committee
SUMMARY ANALYSIS
In 2019, the Legislature enacted the Patient Savings Act (Act), which allows health insurers
to create a shared savings incentive program (program) to encourage insureds to choose lower cost,
high quality nonemergency health care services and share any savings realized as a result of their choice.
Health insurers are not required to establish a program under the Act, and an insured’s participation in a
program is voluntary and optional. A program may offer shared savings incentives as, for example, premium
reduction or return; flexible spending account, health savings account, or health reimbursement account credit;
and cash or cash equivalent including, but not limited to, merchandise, a gift card, or a debit card. Incentives
under a program must be distributed at least quarterly to participating insureds.
Under the Act, services within and outside Florida for which incentives may be offered include, but are not
limited to:
Clinical laboratory services;
Infusion therapy;
Inpatient and outpatient surgical procedures;
Obstetrical and gynecological services;
Inpatient and outpatient nonsurgical diagnostic tests and procedures;
Physical and occupational therapy services;
Radiology and imaging services;
Prescription drugs;
Services provided through telehealth; and
Any additional services published by the Agency for Health Care Administration that have
the most significant price variation both statewide and regionally pursuant to s. 408.05(3)(m),
F.S.
HB 1325 authorizes, but does not require, a health insurer that offers a shared savings incentive program to
include items and services listed in federal law, the Table 1-500 Items and Services List (List), as shoppable
health care services for which the shared savings incentive is available. The List is added to the group of
shoppable health care services from which a health insurer can select certain items and services for its
program.
The bill does not appear to have a fiscal impact on state or local governments.
The bill provides an effective date of July 1, 2022. STORAGE NAME: h1325.FFS PAGE: 2
DATE: 2/15/2022
FULL ANALYSIS
I. SUBSTANTIVE ANALYSIS
A. EFFECT OF PROPOSED CHANGES:
Background
Regulation of Health Insurance in Florida
The Office of Insurance Regulation (OIR) licenses and regulates the activities of insurers, health
maintenance organizations (HMOs), and other risk-bearing entities.
1
The Agency for Health Care
Administration (AHCA) regulates the quality of care by HMOs under part III of ch. 641, F.S. Before
receiving a certificate of authority from the OIR, an HMO must receive a Health Care Provider
Certificate from AHCA.
2
As part of the certification process used by AHCA, an HMO must provide
information to demonstrate that it can provide quality of care consistent with prevailing standards of
care.
3
All persons who transact insurance in the state must comply with the Insurance Code (Code).
4
OIR has the power to collect, propose, publish, and disseminate any information relating to the subject
matter of the Code,
5
and may investigate any matter relating to insurance.
6
Shared Savings Programs
In 2019, the Legislature adopted the Patient Savings Act (Act),
7
which allows health insurers to create a
shared savings incentive program (program) to encourage insured individuals to shop for high quality,
lower cost health care services and share any savings realized with the insured, as a result of the
insured’s choice. The Act authorized implementing incentive programs for plan years beginning
January 1, 2020.
The law permits an issuer of individual and group health insurance policies, as well as a health
maintenance organization (HMO), to establish a program. A program may offer a shared
savings incentive payment to an insured who receives treatment from a comprehensive list of more
than 25 individual entities or groups that provide a health care service; this includes hospitals,
physicians, nursing homes, pharmacies, and others.
8
Health insurers who choose to offer a program must develop a website outlining the range of
“shoppable health care services”
9
available to insureds. The website must provide insureds with an
inventory of participating health care providers and an accounting of the shared savings incentives
available for each shoppable service. The law provides a list of nonemergency services that qualify as
shoppable health care services, which include, but are not limited to:
Clinical laboratory services.
Infusion therapy.
Inpatient and outpatient surgical procedures.
Obstetrical and gynecological services.
Outpatient nonsurgical diagnostic tests and procedures.
Physical and occupational therapy services.
Radiology and imaging services.
Prescription drugs.
1
S. 20.121(3)(a), F.S.
2
S. 641.21(1), F.S.
3
S. 641.495, F.S.
4
S. 624.11, F.S.
5
S. 624.307(4), F.S.
6
S. 624.307(3), F.S.
7
Ch. 2019-100, L.O.F.
8
Ss. 627.6387, 627.6648, and 641.31076, F.S. The State Employee Group Program, which provides health care benefits to state
employees, also offers a shared savings program, described in s. 110.12303, F.S.
9
The term “shoppable health care services” generally refers to medical services that can be scheduled in advance. Florida law
specifies a list of services that qualify for this designation, see Id. STORAGE NAME: h1325.FFS PAGE: 3
DATE: 2/15/2022
Services provided through telehealth.
Shared Savings Incentives
Under current law, a “shared savings incentive” is an optional financial incentive that may be paid to
an insured for choosing certain shoppable health care services under a program.
10
When an insured
obtains a shoppable health care service for less than the average price for the service, any savings
generated will be shared by the health insurer and the insured. An insured is entitled to a financial
incentive that is no less than 25 percent of the savings that accrue to the insurer as a result of the
insured’s participation.
11
A program may financially reward insureds who use shoppable health care services in several different
forms, including, for example, premium reductions, or deposits into a flexible spending account, health
savings account, or health reimbursement account.
12
If an insurer or HMO offers a shared savings program, it must be a component part of the policy,
contract, or certificate of insurance, and the insurer or HMO must notify its insureds of the program
annually and at the time of enrollment and renewal.
13
Currently, one health insurer has a shared savings program, as of January 1, 2021.
14
Federal Rule on Price Transparency
On November 12, 2020, the U.S. Departments of Health and Human Services, Treasury, and Labor
published the Transparency in Coverage Final Rule (Final Rule),
15
imposing new requirements on
group health plans and health insurers in the individual and group markets
16
to disclose cost sharing
information, in-network provider negotiated rates, historical out-of-network allowed amounts, and drug
pricing information.
For plan years beginning on or after January 1, 2022, plans and issuers must make publicly
available, through standardized, regularly updated, machine-readable files:
Negotiated rates for in-network providers;
Historical allowed amounts for out-of-network providers; and
Prices for prescription drugs.
Under the Final Rule, for plan years beginning on or after January 1, 2023, plans and issuers
must disclose to enrollees, through a self-service online tool, personalized cost-sharing
information and negotiated rates for 500 shoppable services (Table 1–500 Items and Services
List) identified in the Final Rule. The List was created using billing codes for various medical items,
services, and treatment. It includes services such as specific medical treatments, screenings,
injections, assessments, medications, surgical procedures, diagnostic tests, and laboratory services.
For plan years beginning on or after January 1, 2024, the disclosure requirement expands to all
covered health care items and services, including encounters, procedures, medical tests, supplies,
prescription drugs, medical equipment, and fees, including facility fees.
10
Ss. 627.6387(2)(c), F.S., and 641.31076(2)(c), F.S.
11
Ss. 627.6387(3)(d), F.S., and 641.31076(3)(d), F.S.
12
Id.
13
Supra, FN 16.
14
Office of Insurance Regulation, 2022 Legislative Session – HB 1325, pg. 2 (Sept. 21, 2021).
15
26 CFR Part 54, 29 CFR Part 2590, 45 CFR Part 147 and 45 CFR Part 158; see Transparency in Coverage; Final Rule,
85 Fed. Reg. 72,158 (Nov. 12, 2020) https://www.federalregister.gov/documents/2020/11/12/2020-24591/transparency-incoverage.
16
The Final Rule does not apply to grandfathered health plans; account-based group health plans, such as health reimbursement
arrangements (HRAs), including individual-coverage HRAs; or health flexible spending accounts, healthcare-sharing ministries, or
short-term limited duration insurance plans. STORAGE NAME: h1325.FFS PAGE: 4
DATE: 2/15/2022
Effect of Proposed Changes
HB 1325 authorizes, but does not require, an individual health insurer that offers a shared savings
incentive program to include items and services listed in federal law, the Table 1-500 Items and
Services List (List), as shoppable health care services for which the shared savings incentive is
available. The List includes health care items and services based on billing codes. A health insurer may
select the List as the entirety of its program, or in conjunction with other categories of services listed in
the statute.
The bill provides an effective date of July 1, 2022.
B. SECTION DIRECTORY:
Section 1: Amends s. 627.6387, F.S., relating to shared savings incentive program.
Section 2: Provides an effective date of July 1, 2022.
II. FISCAL ANALYSIS & ECONOMIC IMPACT STATEMENT
A. FISCAL IMPACT ON STATE GOVER NMENT:
1. Revenues:
None.
2. Expenditures:
None.
B. FISCAL IMPACT ON LOCAL GOVERNMENTS:
1. Revenues:
None.
2. Expenditures:
None.
C. DIRECT ECONOMIC IMPACT ON PRIVATE SECTOR:
None.
D. FISCAL COMMENTS:
None.
III. COMMENTS
STORAGE NAME: h1325.FFS PAGE: 5
DATE: 2/15/2022
A. CONSTITUTIONAL ISSUES:
1. Applicability of Municipality/County Mandates Provision:
Not applicable. This bill does not appear to affect county or municipal governments.
2. Other:
None.
B. RULE-MAKING AUTHORITY:
The bill provisions do not require additional rule-making authority for implementation.
C. DRAFTING ISSUES OR OTHER COMMENTS:
The bill amends the shared savings incentive program statute affecting individual health insurers. The
bill’s provisions do not apply to group, blanket, and franchise health insurance policies or HMOs, which
could be addressed by amending ss. 627.6648(2)(e), F.S., and 641.31076(2)(e), F.S., to add the List to
specified items and services that could be part of a shared savings incentive program.
To address the appropriate effective date, the bill could be amended to make it effective upon
becoming a law, and specifying that the provisions are for plan year 2023.
IV. AMENDMENTS/COMMITTEE SUBSTITUTE CHANGES