Hawaii 2022 Regular Session

Hawaii House Bill HB2032 Compare Versions

Only one version of the bill is available at this time.

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1	1	HOUSE OF REPRESENTATIVES H.B. NO. 2032 THIRTY-FIRST LEGISLATURE, 2022 STATE OF HAWAII A BILL FOR AN ACT relating to Health. BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:
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3	3	HOUSE OF REPRESENTATIVES H.B. NO. 2032
4	4	THIRTY-FIRST LEGISLATURE, 2022
5	5	STATE OF HAWAII
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7	7	HOUSE OF REPRESENTATIVES
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9	9	H.B. NO.
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11	11	2032
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13	13	THIRTY-FIRST LEGISLATURE, 2022
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17	17	STATE OF HAWAII
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31	31	A BILL FOR AN ACT
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37	37	relating to Health.
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43	43	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:
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47	47	SECTION 1. The legislature finds that Hawaii has long been a leader in advancing medical services and health care, advocating the importance of access to health care without discrimination, and implementing forward-thinking health care policy such as the Hawaii Prepaid Health Care Act of 1974. It is in the best interest of the State for each and every beneficiary of med-QUEST, the Hawaii medicaid program, to have publicly provided, high quality, and affordable health care. Health care involves more than just medical insurance payouts, but also includes cost-saving preventative and early intervention measures, dental services, and mental illness treatment to prevent medical health conditions from becoming chronic, permanently disabling, or fatal. Under Hawaii's current health care insurance system, patients encounter many challenges to their medical care, including requirements for prior authorizations, formulary restrictions, and networks with limited physician participation. This system also burdens physicians and hospitals with administrative demands such as pay for performance, pay for documentation, and capitation, all of which require much more detailed documentation and data reporting while controlling and restricting payment for primary care in particular, which results in physicians being driven out of practice or leaving the State. The legislature further finds that health care rates are skyrocketing, creating an affordability and accessibility crisis for Hawaii's residents. The two largest cost drivers of health care in the United States and Hawaii are high administrative costs due to reliance on a competitive insurance business model and the high cost of prescription drugs. For more than a quarter of a century, Hawaii was far ahead of most other states and often called itself the "health state" because of the Prepaid Health Care Act and for having a low percentage of residents without health insurance, which in 1994 was between two and five per cent. The legislature also finds that as a result of the COVID-19 pandemic, thousands of Hawaii residents have lost their jobs and health insurance, making it critical for the State to support struggling families by ensuring preventative care and limiting out-of-pocket costs. The safeguarding of access to health care, solidification of the essential health benefits that have changed thousands of lives, and improvement of overall access to care requires the preservation of certain important aspects of the federal Patient Protection and Affordable Care Act and the expansion of access to care for residents of Hawaii. Nationally, health insurance plans paid per member with risk adjustment based on diagnoses, such as Hawaii's medicaid managed care plans, are currently the subject of multiple federal Department of Justice investigations regarding fraudulent upcoding to secure higher payments by gaming risk adjustment formulas. Medicaid managed care plans have been found to report participating provider lists that are grossly inaccurate, including listing many physicians who are no longer in practice and in some cases are deceased, and listing many physicians who will not actually accept new patients covered by the medicaid managed care plans. Accordingly, the purpose of this Act is to require the auditor to conduct a comprehensive study of the managed care organizations that administer the medicaid program in the State. SECTION 2. (a) The auditor shall conduct a study that includes: (1) A financial analysis of managed care organizations that administer the medicaid program by auditing: (A) Amounts paid for direct health care services, including laboratory and other testing services; (B) Amounts paid for quality improvement under the federal Patient Protection and Affordable Care Act; and (C) Amounts paid for administrative services, including a breakdown of: (i) Medical management administrative costs; (ii) Payment reform administrative costs; and (iii) Payments to providers of health care; (2) An assessment of network adequacy among medicaid managed care plans, by conducting "secret shopper" surveys to determine how many physicians the plans claim to be network providers are actually accepting patients insured by the medicaid managed care plans; and (3) An assessment of the extent of upcoding by medicaid managed care plans to increase payments from Hawaii med-QUEST based on risk adjustment formulas that reward an overdiagnosis. (b) The auditor shall submit a report of its findings and recommendations, including any proposed legislation, to the legislature no later than twenty days prior to the convening of the regular session of 2023. SECTION 3. There is appropriated out of the general revenues of the State of Hawaii the sum of $ or so much thereof as may be necessary for fiscal year 2022-2023 for a comprehensive study of the managed care organizations that administer the medicaid program in the State. The sum appropriated shall be expended by the auditor for the purposes of this Act. SECTION 4. This Act shall take effect on July 1, 2022. INTRODUCED BY: _____________________________
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49	49	SECTION 1. The legislature finds that Hawaii has long been a leader in advancing medical services and health care, advocating the importance of access to health care without discrimination, and implementing forward-thinking health care policy such as the Hawaii Prepaid Health Care Act of 1974. It is in the best interest of the State for each and every beneficiary of med-QUEST, the Hawaii medicaid program, to have publicly provided, high quality, and affordable health care.
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51	51	Health care involves more than just medical insurance payouts, but also includes cost-saving preventative and early intervention measures, dental services, and mental illness treatment to prevent medical health conditions from becoming chronic, permanently disabling, or fatal. Under Hawaii's current health care insurance system, patients encounter many challenges to their medical care, including requirements for prior authorizations, formulary restrictions, and networks with limited physician participation. This system also burdens physicians and hospitals with administrative demands such as pay for performance, pay for documentation, and capitation, all of which require much more detailed documentation and data reporting while controlling and restricting payment for primary care in particular, which results in physicians being driven out of practice or leaving the State.
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53	53	The legislature further finds that health care rates are skyrocketing, creating an affordability and accessibility crisis for Hawaii's residents. The two largest cost drivers of health care in the United States and Hawaii are high administrative costs due to reliance on a competitive insurance business model and the high cost of prescription drugs. For more than a quarter of a century, Hawaii was far ahead of most other states and often called itself the "health state" because of the Prepaid Health Care Act and for having a low percentage of residents without health insurance, which in 1994 was between two and five per cent.
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55	55	The legislature also finds that as a result of the COVID-19 pandemic, thousands of Hawaii residents have lost their jobs and health insurance, making it critical for the State to support struggling families by ensuring preventative care and limiting out-of-pocket costs. The safeguarding of access to health care, solidification of the essential health benefits that have changed thousands of lives, and improvement of overall access to care requires the preservation of certain important aspects of the federal Patient Protection and Affordable Care Act and the expansion of access to care for residents of Hawaii.
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57	57	Nationally, health insurance plans paid per member with risk adjustment based on diagnoses, such as Hawaii's medicaid managed care plans, are currently the subject of multiple federal Department of Justice investigations regarding fraudulent upcoding to secure higher payments by gaming risk adjustment formulas. Medicaid managed care plans have been found to report participating provider lists that are grossly inaccurate, including listing many physicians who are no longer in practice and in some cases are deceased, and listing many physicians who will not actually accept new patients covered by the medicaid managed care plans.
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59	59	Accordingly, the purpose of this Act is to require the auditor to conduct a comprehensive study of the managed care organizations that administer the medicaid program in the State.
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61	61	SECTION 2. (a) The auditor shall conduct a study that includes:
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63	63	(1) A financial analysis of managed care organizations that administer the medicaid program by auditing:
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65	65	(A) Amounts paid for direct health care services, including laboratory and other testing services;
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67	67	(B) Amounts paid for quality improvement under the federal Patient Protection and Affordable Care Act; and
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69	69	(C) Amounts paid for administrative services, including a breakdown of:
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71	71	(i) Medical management administrative costs;
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73	73	(ii) Payment reform administrative costs; and
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75	75	(iii) Payments to providers of health care;
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77	77	(2) An assessment of network adequacy among medicaid managed care plans, by conducting "secret shopper" surveys to determine how many physicians the plans claim to be network providers are actually accepting patients insured by the medicaid managed care plans; and
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79	79	(3) An assessment of the extent of upcoding by medicaid managed care plans to increase payments from Hawaii med-QUEST based on risk adjustment formulas that reward an overdiagnosis.
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81	81	(b) The auditor shall submit a report of its findings and recommendations, including any proposed legislation, to the legislature no later than twenty days prior to the convening of the regular session of 2023.
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83	83	SECTION 3. There is appropriated out of the general revenues of the State of Hawaii the sum of $ or so much thereof as may be necessary for fiscal year 2022-2023 for a comprehensive study of the managed care organizations that administer the medicaid program in the State.
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85	85	The sum appropriated shall be expended by the auditor for the purposes of this Act.
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87	87	SECTION 4. This Act shall take effect on July 1, 2022.
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91	91	INTRODUCED BY: _____________________________
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93	93	INTRODUCED BY:
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95	95	_____________________________
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101	101	Report Title: Auditor; Study; Medicaid Managed Care; Med-QUEST Description: Requires the auditor to conduct a comprehensive study of managed care organizations that administer the medicaid program in the State. The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.
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107	107	Report Title:
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109	109	Auditor; Study; Medicaid Managed Care; Med-QUEST
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113	113	Description:
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115	115	Requires the auditor to conduct a comprehensive study of managed care organizations that administer the medicaid program in the State.
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123	123	The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.