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Regular Session, 2010
SENATE BILL NO. 795 (Substitute Bill for Senate Bill No. 359 by Senator Broome)
BY SENATOR BROOME
INSURANCE DEPARTMENT. Provides for network adequacy in the health insurance
market. (1/11/11)
AN ACT1
To enact R.S. 22: 972(D) and 1016, relative to network adequacy in health insurance;2
provides for the filing of the network of participating health care providers; provides3
for definitions; requires all health insurance issuers to have an adequate network of4
providers; provides for penalties for violation of network adequacy rules; and to5
provide for related matters.6
Be it enacted by the Legislature of Louisiana:7
Section 1. R.S. 22:972(D) and 1016 are hereby enacted to read as follows:8
§972. Approval and disapproval of forms; filing of rates9
* * *10
D. An initial filing of policy forms by a health insurance issuer as11
described in Subsection A of this Section shall include the network or providers,12
if any, to be used in connection with the policy forms in accordance with the13
provisions of R.S. 22:1016C(1) and (2). If benefits under a health insurance14
policy do not rely on a network of providers, the issuer shall state such fact in15
the forms filing.16
* * *17 SB NO. 795
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§1016. Network adequacy and accessibility; definitions; requirements; penalties1
A. The purpose and intent of this Section is to establish standards for the2
creation and maintenance of networks by health insurance issuers.3
B. For the purposes of this Section:4
(1) "Commissioner" means the insurance commissioner of this state.5
(2) "Covered health care services" or "covered benefits" or "benefits"6
means services, including ancillary services, items, supplies, or drugs for the7
diagnosis, prevention, treatment, cure, or relief of a health condition, illness,8
injury, or disease that are either covered and payable under the terms of health9
insurance coverage or required by law to be covered.10
(3) "Covered person" means a policyholder, subscriber, enrollee or11
other individual participating in a health benefit plan.12
(4) "Critical access or acute care hospital" means any institution, place,13
building, or agency, public or private, whether for profit or not, maintaining14
and operating facilities, twenty-four hours a day, seven days a week, having ten15
licensed beds or more, properly staffed and equipped for the diagnosis,16
treatment and care of persons admitted for overnight stay or longer who are17
suffering from illness, injury, infirmity or deformity or other physical or mental18
condition for which medical, surgical or obstetrical services would be available19
and appropriate.20
(5) "Health benefit plan" means a policy, contract, certificate or21
agreement entered into, offered or issued by a health insurance issuer to22
provide, deliver, arrange for, pay for or reimburse any of the costs of covered23
health care services.24
(6) "Health care physician" means a physician licensed, certified, or25
registered to perform specified health care services consistent with state law.26
(7) "Health care provider" or "provider" means a licensed health care27
physician or a hospital or the agent or assignee of such physician or hospital.28
(8) "Health insurance issuer" means an entity subject to the insurance29 SB NO. 795
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laws and regulations of this state, or subject to the jurisdiction of the1
commissioner, that contracts or offers to contract, or enters into an agreement2
to provide, deliver, arrange for, pay for or reimburse any of the costs of covered3
health care services, including a sickness and accident insurance company, a4
health maintenance organization, or any other entity providing a plan of health5
insurance, health benefits or health services.6
(9) "Network of providers" or "network" means for each form, all the7
participating health care providers directly or indirectly contracted with a8
health insurance issuer to provide covered health care services to covered9
persons.10
(10) "Participating health care provider" means a health care provider11
who, under a contract with the health insurance issuer or with its contractor or12
subcontractor, has agreed to provide covered health care services to covered13
persons with an expectation of receiving payment, other than coinsurance,14
copayments or deductibles, directly or indirectly from the health insurance15
issuer.16
C.(1) A health insurance issuer that uses a network of providers will17
effectively provide or arrange for the provision of covered health care services18
through its network of participating health care providers.19
(2) For any policy that utilizes a network of providers, a health insurance20
issuer shall maintain a network that is adequate in numbers and types of health21
care providers to assure that all covered health care services will be accessible22
to covered persons without unreasonable delay. Adequacy shall be determined23
in accordance with this Section and may be established by reference to any24
reasonable criteria used by the health insurance issuer, including but not25
limited to:26
(a) The geographic accessibility of participating health care providers27
within a thirty-mile radius, except in geographic areas in which there is limited28
availability or providers of certain specialty types.29 SB NO. 795
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(b) Waiting times for appointments with participating health care1
providers.2
(c) Hours of operation.3
(d) Adequate availability of technological and specialty services available4
to serve the needs of covered persons requiring technologically advanced or5
specialty care.6
(e) Access to emergency services twenty-four hours per day, seven days7
per week.8
(3) A health insurance issuer’s network of providers shall not be9
considered inadequate on the basis of the lack in a health insurance issuer’s10
network of providers of a particular type of health care provider, when the11
health insurance issuer demonstrates that it has made all reasonable efforts to12
contract with available providers of that type.13
(4) No later than January 31, 2011, a health insurance issuer shall file for14
approval with the commissioner the network of participating providers, if any,15
that supports each of the health insurance issuer's health benefit plans. Any16
network filed for approval by the commissioner shall contain:17
(a) A copy of the contract or the standard participating provider18
agreement used by the health insurance issuer to contract with each provider19
type for the provision of covered services.20
(b) A statement describing the health insurance issuer's method of21
providing for covered health care services and describing the professional22
services to be rendered by numbers and types of participating physicians and23
hospitals. This statement shall include the health care delivery capabilities of24
each health benefit plan including the numbers and types of participating25
physicians and hospitals.26
(c) A statement reasonably describing the geographic service area or27
areas to be served by the health insurance issuer; this statement shall also28
include a listing of principal and other offices maintained in this state by the29 SB NO. 795
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health insurance issuer.1
(5) (a) A health insurance issuer shall file a notice describing any2
material modification of any network filed for approval in accordance with this3
Section. The notice shall be filed with the commissioner as soon as possible but4
not later than thirty days following the material modification or receipt of any5
updated information by the health insurance issuer.6
(b) Material modification shall include, but not be limited to, the7
following:8
(i) Loss of a critical access or acute care hospital from the network.9
(ii) Any case where the health insurance issuer has an insufficient10
number or type of participating providers, according to the provisions of11
Subsection C of this Section, to provide a covered health care service.12
(iii) Any other circumstances deemed to be an adverse material13
modification to an insured or enrollee obtaining a covered health care service.14
(iv) Any other changes to a network of providers that, cumulatively,15
jeopardize adequacy of the network as described in Subsection C.16
(6)Whenever the commissioner believes, based on a filing required by17
R.S. 22:972(D) or the filing required by Subsection C of this Section, that a18
health insurance issuer’s network of providers is inadequate to provide covered19
health care services to covered persons, the commissioner may require the20
health insurance issuer to provide all or part of the information about its21
network described in Paragraph (3) of this Subsection. A health insurance22
issuer shall provide such requested information no later than thirty days of23
receipt of such request from the commissioner.24
D.(1) Whenever a health insurance issuer is in violation of the provisions25
of this Section, the commissioner shall notify the health insurance issuer in26
writing of such violation, directing the health insurance issuer to submit a27
corrective action plan or other response within thirty days.28
(2) If a health insurance issuer does not submit a satisfactory response29
within thirty days, the commissioner may either:30 SB NO. 795
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(a) Issue and cause to be served an order requiring the health insurance1
issuer to cease and desist the use of such form or network of participating2
providers.3
(b) Issue and cause to be served an order to cease and desist any action4
that is in violation of this Section.5
(3)(a) The commissioner may not impose a cease and desist order if the6
health insurance issuer demonstrates that the health insurance issuer has7
remedied the reason for the notice from the commissioner or that there will be8
no detriment to the insured or enrollee obtaining covered health care services9
and upon a written agreement from the health insurance issuer ensuring that10
the insured or enrollee obtains covered health care services at an in-network11
benefit level.12
(b) If the commissioner determines that a health insurance issuer’s13
network of providers is inadequate in a certain geographic area, any cease and14
desist order related to such inadequacy shall be limited to only that geographic15
area and shall not prohibit use of the health insurance issuer’s network in other16
geographic areas of the state.17
(4) Following completion of the actions described in Subparagraphs (1)18
through (3) of this Subsection, the commissioner may suspend or revoke any19
certificate of authority issued to a health insurance issuer under this Section if20
he finds that:21
(a) A health insurance issuer's network impairs the ability of the health22
insurance issuer to adequately provide or arrange for covered health care23
services for its enrollees or insureds.24
(b) The health insurance issuer is operating significantly in25
contravention of the documents submitted or in a manner contrary to that26
described in any information submitted under this Section, unless the health27
insurance issuer filed with the commissioner those modifications as required by28
this Section.29
E. The provisions of this Section shall not apply to the office of group30 SB NO. 795
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benefits, any self-funded governmental or parish plan, or any other plan1
preempted under the provisions of the Employee Retirement Income Security2
Act of 1974.3
F. The commissioner of insurance may promulgate rules and regulations4
that he determines are necessary for implementation of this Section. Such5
implementation shall be subject to the legislative oversight of the House of6
Representatives and Senate committees on insurance in accordance with R.S.7
49:968.8
Section 2. The provisions of this Act shall be effective January 1, 2011.9
The original instrument was prepared by Cheryl Horne. The following digest,
which does not constitute a part of the legislative instrument, was prepared
by Ann S. Brown.
DIGEST
Broome (SB 795)
Present law requires all policies of health and accident insurance to be filed with and
approved by the commissioner of insurance prior to delivery or issuance in the state.
Proposed law retains present law and also requires all health and accident insurers to file its
network of participating health care providers at the initial filing of its policy forms. Further
provides that if the policy does not rely on a network of providers, such fact shall be stated
in the forms when filed.
Proposed law provides for the definitions of commissioner, covered health care services,
covered benefits, benefits, covered person, critical access or acute care hospital, health
benefit plan, health care physician, health care provider, provider, health insurance issuer,
network of providers, network, and participating health care provider.
Proposed law requires all health insurance issuers, that uses a network of providers, to
effectively provide or arrange for the provision of health care services through its network
of participating health care services.
Proposed law provides that a policy that utilizes a network of providers shall maintain a
network that is adequate in numbers and types of health care providers to assure that all
covered health care services will be accessible to covered persons. Further provides that
adequacy shall be determined and referenced by any reasonable criteria used by health
insurance issuer, including, but not limited to:
a. Geographic accessibility of participating health care providers within a 30
mile radius where possible.
b. Waiting time for appointments.
c. Hours of operations.
d. Adequate availability of technological and speciality services.
e. Access to emergency services 24 hours per day, seven days a week. SB NO. 795
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Proposed law provides that a health insurance issuer's network of providers shall not be
considered inadequate if they demonstrate they have made all reasonable efforts to contract
with available providers of that type of service.
Proposed law provides that a copy of the contract or the standard participating provider
agreement used by the health insurance issuer be filed with the commissioner for approval.
Provides that the filing describe the method of providing health care services and shall
include the health care delivery capabilities of each health benefit plan including numbers
and types of participating physicians and hospitals.
Proposed law requires a statement to be issued describing the geographic service area or
areas to be served by the health insurance issuer. Requires the filing of notice of any material
modification to the network and requires the commissioner to give approval to the
modification. Requires the health insurance issuer to provide notice to the commissioner no
later than 30 days following a material modification. Defines material modification as the
loss of a critical access or acute care hospital from the network, any case where the health
insurance issuer has an insufficient number or type of participating providers to provide a
covered health care service or any other circumstances deemed to be an adverse material
modification to an insured or enrollee obtaining a covered health care service.
Proposed law requires the commissioner to notify the health insurance issuer in writing of
a violation and to direct the health insurance issuer to submit a corrective action plan or
other response within 30 days. If a satisfactory response is not issued within 30 days, the
commissioner may issue a cease and desist order regarding the use of the form or network
of participating providers or issue an order to cease and desist any action that is in violation.
Proposed law provides that the commissioner may not impose a cease and desist order if the
health insurance issuer demonstrates that the health insurance issuer has remedied the reason
for the notice from the commissioner or there will be no detriment to the insured or enrollee
obtaining covered health care services and upon a written agreement from the health
insurance issuer ensuring that the insured or enrollee obtains covered health care services
at no greater cost than if the covered health care services were obtained from participating
health care providers.
Proposed law allows the commissioner to suspend or revoke the certificate of authority of
the health insurance issuer if the network impairs the ability of the health insurance issuer
to adequately provide or arrange for covered health care services to its enrollees or insured
or if the health insurance issuer is operating significantly in contravention of the documents
submitted to the commissioner.
Proposed law exempts the office of group benefits, any self-funded governmental or parish
plan or any other plan preempted under the provisions of the Employee Retirement Income
Security Act.
Proposed law permits the commissioner to promulgate rules and regulations in accordance
with the Administrative Procedure Act.
Effective Jan. 1, 2011.
(Adds R.S. 22:972(D) and 1016)
Summary of Amendments Adopted by Senate
Senate Floor Amendments to engrossed bill.
1. Adds the requirement that a health insurance issuer shall state clearly if its
policy does not reply on a network of providers at the initial filing of the
policy. SB NO. 795
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2. Removes the prohibition on form usage and rights to a hearing for appeal
extended to a network of participating health providers denied by the
commissioner.
3. Add a definition for critical access or acute care hospitals.
4. Removes references concerning a health insurance issuer, not utilizing a
network of health care providers, needing to file for an exemption to be
approved by the commissioner.
5. Adds a requirement that a policy utilizing a network of providers shall
maintain a network that is adequate in numbers and types of health care
providers. Further provides how adequacy is determined for such heath
insurance issuer's policy.
6. Changes the required statement of information content to be submitted by the
health insurance issuer to the commissioner from the number of health care
physicians, number of nonprimary health care physicians and number and
type of contracted hospitals to the number and types of participating
physicians and hospitals.
7. Clarifies that a material modification is the loss of a critical access or acute
care hospital instead of a general or acute hospital.
8. Adds a provision allowing the commissioner to require additional
information about network providers when the commissioner believes the
network is inadequate to provide the covered services to insurers. Requires
that such information be submitted within 30 days.
9. Changes from permissive to mandatory the authority of a commissioner to
direct a health insurance issuer to submit a corrective action plan when in
violation of proposed law.
10. Adds insurance plans exempted from proposed law.
11.Adds an effective date.