Massachusetts 2023-2024 Regular Session

Massachusetts Senate Bill S2881 Compare Versions

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Old	New	Differences
1	1	1 of 121
2	2	SENATE . . . . . . . . . . . . . . No. 2881
3	3	Senate, July 18, 2024 -- Text of the Senate amendment to the House Bill enhancing the health
4	4	care market review process (House, No. 4653) (being the text of Senate document numbered
5	5	2871)
6	6	The Commonwealth of Massachusetts
7	7	_______________
8	8	In the One Hundred and Ninety-Third General Court
9	9	(2023-2024)
10	10	_______________
11	11	1 SECTION 1. Section 16 of chapter 6A of the General Laws, as appearing in the 2022
12	12	2Official Edition, is hereby amended by striking out, in lines 24 to 26, inclusive, the words “, the
13	13	3division of medical assistance and the Betsy Lehman center for patient safety and medical error
14	14	4reduction” and inserting in place thereof the following words:- and the division of medical
15	15	5assistance.
16	16	6 SECTION 2. Section 16D of said chapter 6A, as so appearing, is hereby amended by
17	17	7striking out, in lines 22 to 24, inclusive, the words “department of public health established by
18	18	8section 217 of chapter 111” and inserting in place thereof the following words:- health policy
19	19	9commission established by section 16 of chapter 6D.
20	20	10 SECTION 3. Section 16N of said chapter 6A is hereby repealed.
21	21	11 SECTION 4. Section 16T of said chapter 6A is hereby repealed.
22	22	12 SECTION 5. Section 1 of chapter 6D of the General Laws, as so appearing, is hereby
23	23	13amended by inserting after the definition of “Alternative payment methodologies or methods”
24	24	14the following definition:- 2 of 121
25	25	15 “Benchmark cycle”, a period of 2 consecutive calendar years during which the projected
26	26	16annualized growth rate in total health care expenditures in the commonwealth is calculated
27	27	17pursuant to section 9 and monitored pursuant to section 10.
28	28	18 SECTION 6. Said section 1 of said chapter 6D, as so appearing, is hereby further
29	29	19amended by inserting after the definition of “Fee-for-service” the following definition:-
30	30	20 “Financial interest”, when a private equity firm or its corporate affiliate has a direct or
31	31	21indirect ownership share of, or controlling interest in, or is a holder of significant debt from a
32	32	22provider or provider organization or the provider or provider organization’s corporate affiliates.
33	33	23 SECTION 7. Said section 1 of said chapter 6D, as so appearing, is hereby further
34	34	24amended by striking out the definition of “Health care cost growth benchmark” and inserting in
35	35	25place thereof the following definition:-
36	36	26 “Health care cost growth benchmark”, the projected annualized growth rate in total health
37	37	27care expenditures in the commonwealth during a benchmark cycle, as established in section 9.
38	38	28 SECTION 8. Said section 1 of said chapter 6D, as so appearing, is hereby further
39	39	29amended by inserting after the definition of “Health care provider” the following definition:-
40	40	30 “Health care resource”, any resource, whether personal or institutional in nature and
41	41	31whether owned or operated by any person, the commonwealth or political subdivision thereof,
42	42	32the principal purpose of which is to provide, or facilitate the provision of, services for the
43	43	33prevention, detection, diagnosis or treatment of those physical and mental conditions
44	44	34experienced by humans which usually are the result of, or result in, disease, injury, deformity or 3 of 121
45	45	35pain; provided, that the term “treatment” shall include custodial and rehabilitative care incident
46	46	36to infirmity, developmental disability or old age.
47	47	37 SECTION 9. Said section 1 of said chapter 6D, as so appearing, is hereby further
48	48	38amended by inserting after the definition of “Health care services” the following 2 definitions:-
49	49	39 “Health disparities”, preventable differences in the burden of disease, injury, violence or
50	50	40opportunities to achieve optimal health that are experienced by socially disadvantaged
51	51	41populations.
52	52	42 “Health equity”, the state in which a health system offers the infrastructure, facilities,
53	53	43services, geographic coverage, affordability and all other relevant features, conditions and
54	54	44capabilities to provide every resident of the commonwealth with the opportunity and reasonable
55	55	45expectation to achieve optimal health and equal access to health care regardless of race,
56	56	46ethnicity, language, disability, age, gender, gender identity, sexual orientation, social class,
57	57	47intersections among such communities or identities or socially determined circumstances.
58	58	48 SECTION 10. Said section 1 of said chapter 6D, as so appearing, is hereby further
59	59	49amended by inserting after the definition of “Hospital service corporation” the following 2
60	60	50definitions:-
61	61	51 “Management services organization”, a corporation that provides management or
62	62	52administrative services to a provider or provider organization for compensation.
63	63	53 “Maximum adjusted debt to adjusted EBITDA ratio”, the highest ratio of total adjusted
64	64	54debt to adjusted earnings before interest, taxes, depreciation and amortization the commission
65	65	55determines that a provider or provider organization is permitted to have without becoming 4 of 121
66	66	56financially unstable; provided, however, that the commission, in consultation with the center,
67	67	57shall establish a standard method of calculating and reporting total adjusted debt and adjusted
68	68	58earnings before interest, taxes, depreciation and amortization; and provided further, that the
69	69	59methodology and reporting shall include capitalized lease obligations.
70	70	60 SECTION 11. Said section 1 of said chapter 6D, as so appearing, is hereby further
71	71	61amended by striking out, in line 189, the words “not include excludes ERISA plans” and
72	72	62inserting in place thereof the following words:- include self-insured plans to the extent allowed
73	73	63under the federal Employee Retirement Income Security Act of 1974.
74	74	64 SECTION 12. Said section 1 of said chapter 6D, as so appearing, is hereby further
75	75	65amended by inserting after the definition of “Performance penalty” the following 2 definitions:-
76	76	66 “Pharmaceutical manufacturing company”, an entity engaged in the: (i) production,
77	77	67preparation, propagation, compounding, conversion or processing of prescription drugs, directly
78	78	68or indirectly, by extraction from substances of natural origin, independently by means of
79	79	69chemical synthesis or by a combination of extraction and chemical synthesis; or (ii) packaging,
80	80	70repackaging, labeling, relabeling or distribution of prescription drugs; provided, however, that
81	81	71pharmaceutical manufacturing company shall not include a wholesale drug distributor licensed
82	82	72under section 36B of chapter 112 or a retail pharmacist registered under section 39 of said
83	83	73chapter 112.
84	84	74 “Pharmacy benefit manager”, a person, business or other entity, however organized, that
85	85	75directly or through a subsidiary provides pharmacy benefit management services for prescription
86	86	76drugs and devices on behalf of a health benefit plan sponsor including, but not limited to, a self-
87	87	77insurance plan, labor union or other third-party payer; provided, however, that pharmacy benefit 5 of 121
88	88	78management services shall include, but not be limited to: (i) the processing and payment of
89	89	79claims for prescription drugs; (ii) the performance of drug utilization review; (iii) the processing
90	90	80of drug prior authorization requests; (iv) pharmacy contracting; (v) the adjudication of appeals or
91	91	81grievances related to prescription drug coverage contracts; (vi) formulary administration; (vii)
92	92	82drug benefit design; (viii) mail and specialty drug pharmacy services; (ix) cost containment; (x)
93	93	83clinical, safety and adherence programs for pharmacy services; and (xi) management of the cost
94	94	84of covered prescription drugs; provided further, that pharmacy benefit manager shall include a
95	95	85health benefit plan sponsor that does not contract with a pharmacy benefit manager and manages
96	96	86its own prescription drug benefits unless specifically exempted by the commission.
97	97	87 SECTION 13. Said section 1 of said chapter 6D, as so appearing, is hereby further
98	98	88amended by inserting after the definition of “Primary care provider” the following definition:-
99	99	89 “Private equity firm”, a publicly traded or non-publicly traded company that collects
100	100	90capital investments from individuals or entities and purchases, as a parent company or through
101	101	91another entity that it completely or partially owns or controls, a direct or indirect ownership share
102	102	92of, or controlling interest in, or otherwise obtains a financial interest in, a provider, provider
103	103	93organization or management services organization; provided, however, that private equity firm
104	104	94shall not include venture capital firms exclusively funding startups or other early-stage business.
105	105	95 SECTION 14. Said section 1 of said chapter 6D, as so appearing, is hereby further
106	106	96amended by striking out the definition of “Provider organization” and inserting the following 2
107	107	97definitions:-
108	108	98 “Provider organization”, a corporation, partnership, business trust, association or
109	109	99organized group of persons that is in the business of health care delivery or management, 6 of 121
110	110	100whether incorporated or not that represents 1 or more health care providers in contracting with
111	111	101carriers, third party administrators or public payers for the payments of health care services;
112	112	102provided, however, that “provider organization” shall include, but not be limited to, physician
113	113	103organizations, physician-hospital organizations, management services organizations, independent
114	114	104practice associations, provider networks, accountable care organizations, providers that are
115	115	105owned or controlled, fully or partially, by for-profit entities including, but not limited to, private
116	116	106equity firms, and any other organization that contracts with carriers, third party administrators or
117	117	107public payers for payment for health care services; and provided further, that “provider
118	118	108organization” shall not include any integrated care network that is owned and directed by long-
119	119	109term care.
120	120	110 SECTION 15. Said section 1 of said chapter 6D, as so appearing, is hereby further
121	121	111amended by inserting after the definition of “Quality measure” the following definition:-
122	122	112 “Real estate investment trust”, a real estate investment trust as defined in 26 U.S.C. 856.
123	123	113 SECTION 16. Said section 1 of said chapter 6D, as so appearing, is hereby further
124	124	114amended by inserting after the definition of “Total health care expenditures” the following 2
125	125	115definitions:-
126	126	116 “Total medical expenses”, the total cost of care for the patient population associated with
127	127	117a provider organization based on allowed claims for all categories of medical expenses and all
128	128	118non-claims related payments to providers.
129	129	119 “Unsafe financial actor”, a private equity firm or real estate investment trust that had a
130	130	120financial interest in a provider or provider organization that closed, declared bankruptcy or 7 of 121
131	131	121otherwise discontinued its operations, within 15 years of the private equity firm or real estate
132	132	122investment trust’s financial interest in the provider or provider organization.
133	133	123 SECTION 17. Section 2 of said chapter 6D, as so appearing, is hereby amended by
134	134	124striking out subsections (b) and (c) and inserting in place thereof the following 2 subsections:-
135	135	125 (b)(1) There shall be a board, with duties and powers established by this chapter, which
136	136	126shall govern the commission. The board shall consist of the following members: the secretary of
137	137	127administration and finance, ex officio; the secretary of health and human services, ex officio; 7
138	138	128members to be appointed by the governor pursuant to paragraph (2), 1 of whom shall serve as
139	139	129chair; and 4 members to be appointed by the attorney general. Each appointment after the initial
140	140	130term of appointment shall serve a term of 5 years; provided, however, that a person appointed to
141	141	131fill a vacancy shall serve for not more than the unexpired term. An appointed member of the
142	142	132board shall be eligible for reappointment; provided, however, that no appointed member shall
143	143	133concurrently hold full or part-time employment in the executive branch. The board shall annually
144	144	134elect 1 of its members to serve as vice-chairperson. Each member of the board shall be a resident
145	145	135of the commonwealth. A member of the board serving ex officio may appoint a designee under
146	146	136section 6A of chapter 30; provided further, however, that designee members shall not serve as
147	147	137chair or vice-chair.
148	148	138 (2) The person appointed by the governor to serve as chair shall have demonstrated
149	149	139expertise in health care administration, finance and management at a senior level. The second
150	150	140person appointed by the governor shall be a registered nurse with expertise in the delivery of care
151	151	141and development and utilization of innovative treatments in the practice of patient care. The third
152	152	142person appointed by the governor shall have demonstrated expertise in health plan administration 8 of 121
153	153	143and finance. The fourth person appointed by the governor shall have demonstrated expertise in
154	154	144representing the health care workforce as a leader in a labor organization. The fifth person
155	155	145appointed by the governor shall have demonstrated expertise in development and pricing for
156	156	146pharmaceuticals, biotechnology or medical devices. The sixth person appointed by the governor
157	157	147shall be a primary care physician. The seventh person appointed by the governor shall have
158	158	148demonstrated expertise as a purchaser of health insurance representing business management or
159	159	149health benefits administration. The first person appointed by the attorney general shall have
160	160	150demonstrated expertise in hospitals or hospital health systems administration, finance or
161	161	151management. The second person appointed by the attorney general shall have demonstrated
162	162	152expertise in health care consumer advocacy. The third person appointed by the attorney general
163	163	153shall have expertise in behavioral health, substance use disorder, mental health services and
164	164	154mental health reimbursement systems. The fourth person appointed by the attorney general shall
165	165	155be a health economist.
166	166	156 (c) Seven members of the board shall constitute a quorum, and the affirmative vote of 6
167	167	157members of the board shall be necessary and sufficient for any action taken by the board. No
168	168	158vacancy in the membership of the board shall impair the right of a quorum to exercise all the
169	169	159rights and duties of the commission. The appointed members of the board shall receive a stipend
170	170	160in an amount not more than 10 per cent of the salary of the secretary of administration and
171	171	161finance under section 4 of chapter 7; provided, however, that the chairperson shall receive a
172	172	162stipend in an amount not more than 12 per cent of the salary of the secretary; and provided
173	173	163further, that ex officio members and their designees shall not receive a stipend for their service as
174	174	164board members. Appointed members of the board shall be special state employees subject to
175	175	165chapter 268A. An appointed member of the board shall not be employed by, a consultant to, a 9 of 121
176	176	166member of the board of directors of or otherwise be a representative of a health care entity,
177	177	167pharmaceutical manufacturer or pharmacy benefit manager while serving on the board.
178	178	168 SECTION 18. Said chapter 6D is hereby further amended by inserting after section 3 the
179	179	169following section:-
180	180	170 Section 3A. (a) There shall be within the commission an office for pharmaceutical policy
181	181	171and analysis. The office shall: (i) issue reports including, but not limited to, an annual report
182	182	172pursuant to subsection (b) and analyses of: (A) pharmaceutical spending in the commonwealth;
183	183	173the affordability of and access to pharmaceutical drugs; (B) the potential innovation of high
184	184	174value drugs and orphan drugs; and (C) the impacts of these issues on racially and ethnically
185	185	175diverse populations and individuals with disabilities; (ii) analyze pharmaceutical data collected
186	186	176by agencies of the commonwealth including, but not limited to, pharmaceutical data collected by
187	187	177the center pursuant to sections 8 to 10, inclusive, of chapter 12C and pharmaceutical data
188	188	178available through public and proprietary sources; provided, however, that the commission may
189	189	179solicit additional data and information directly from manufacturers, pharmacy benefit managers
190	190	180and payers to the extent necessary to perform the duties set forth in this section, including, but
191	191	181not limited to, conducting an annual survey of payers on pharmaceutical access and plan design;
192	192	182provided, however, that confidential data shall not be a public record and shall be exempt from
193	193	183disclosure pursuant to clause Twenty-sixth of section 7 of chapter 4 and section 10 of chapter 66;
194	194	184(iii) assess the value and pricing of pharmaceutical drugs used in the commonwealth including,
195	195	185but not limited to, reviewing disclosures submitted pursuant to section 8A; and (iv) advise other
196	196	186state agencies and entities including, but not limited to, the executive office of health and human
197	197	187services, the office of Medicaid, the division of insurance, the group insurance commission, the
198	198	188commonwealth health insurance connector authority, the department of corrections, the 10 of 121
199	199	189Massachusetts Life Sciences Center and the joint committee on health care financing on actions,
200	200	190including any proposed legislation, that may improve the value and pricing of pharmaceutical
201	201	191drugs in the commonwealth.
202	202	192 (b) The commission shall compile an annual report concerning trends and underlying
203	203	193factors for pharmaceutical drug spending including, but not limited to, analysis of: (i) prices and
204	204	194utilization; (ii) drugs or categories of drugs with the highest impact on spending; (iii) trends in
205	205	195patient out-of-pocket spending; and (iv) any recommendations for strategies to reduce
206	206	196pharmaceutical spending growth, promote affordability and enhance pharmaceutical access. The
207	207	197report shall be based on: (A) the commission’s analysis of information provided at the annual
208	208	198health care cost trends hearings by providers, provider organizations and insurers; (B) data
209	209	199collected by the center for health information and analysis under sections 8 to10, inclusive, of
210	210	200chapter 12C; and (C) any other information the commission considers necessary to fulfill its
211	211	201duties under this section, as further defined in regulations promulgated by the commission.
212	212	202Annually, not later than December 31, the commission shall submit the report to the chairs of the
213	213	203house and senate committees on ways and means and the chairs of the joint committee on health
214	214	204care financing and shall publish and make the report available to the public.
215	215	205 SECTION 19. Said chapter 6D is hereby further amended by striking out section 4, as
216	216	206appearing in the 2022 Official Edition, and inserting in place thereof the following section:-
217	217	207 Section 4. There shall be an advisory council to the commission. The council shall advise
218	218	208on the overall operation and policy of the commission. The commission shall convene the
219	219	209council quarterly or more frequently as requested by the commission. Members of the board of
220	220	210the health policy commission shall convene and consult with advisory council members on 11 of 121
221	221	211issues brought before the commission and shall present the views of advisory council members
222	222	212in board meetings. The council shall be appointed by the executive director and reflect a broad
223	223	213distribution of diverse perspectives on the health care system, including, but not limited to,
224	224	214health care professionals, educational institutions, consumer representatives, purchasers of health
225	225	215insurance representing business management or health benefits administration, medical device
226	226	216manufacturers, representatives of the biotechnology industry, pharmaceutical manufacturers,
227	227	217providers, provider organizations, hospitals, community health centers, labor organizations,
228	228	218organizations involved in health equity advocacy and public and private payers.
229	229	219 SECTION 20. Section 5 of said chapter 6D, as so appearing, is hereby amended by
230	230	220inserting after the word “growth”, in line 3, the following words:- and affordability.
231	231	221 SECTION 21. Said section 5 of said chapter 6D, as so appearing, is hereby further
232	232	222amended by striking out, in line 10, the words “and (vii)” and inserting in place thereof the
233	233	223following words:- ; (vii) monitor pharmaceutical spending and pricing and patient access to
234	234	224pharmaceuticals; and (viii).
235	235	225 SECTION 22. The first paragraph of section 6 of said chapter 6D, as so appearing, is
236	236	226hereby amended by adding the following sentence:-
237	237	227 Each pharmaceutical manufacturing company and pharmacy benefit manager shall pay to
238	238	228the commonwealth an amount for the estimated expenses of the center and for the other purposes
239	239	229described in this chapter.
240	240	230 SECTION 23. Said section 6 of said chapter 6D, as so appearing, is hereby further
241	241	231amended by striking out, in lines 5 and 36, the figure “33”, each time it appears, and inserting in
242	242	232place thereof, in each instance, the following figure:- 25. 12 of 121
243	243	233 SECTION 24. Said section 6 of said chapter 6D, as so appearing, is hereby further
244	244	234amended by adding the following 3 paragraphs:-
245	245	235 To the maximum extent permissible under federal law, provided that such assessment
246	246	236will not result in any reduction of federal financial participation in Medicaid, the assessed
247	247	237amount for pharmaceutical manufacturing companies shall be not less than 25 per cent of the
248	248	238amount appropriated by the general court for the expenses of the commission less amounts
249	249	239collected from: (i) filing fees; (ii) fees and charges generated by the commission's publication or
250	250	240dissemination of reports and information; and (iii) federal matching revenues received for said
251	251	241expenses or received retroactively for expenses of predecessor agencies. Pharmaceutical
252	252	242manufacturing companies shall pay such assessed amount multiplied by the ratio of the
253	253	243pharmaceutical manufacturing company’s gross sales of outpatient prescription drugs dispensed
254	254	244in the commonwealth or similar measure determined by the commission consistent with
255	255	245applicable federal requirements.
256	256	246 To fund the operations of the commonwealth’s licensure of pharmacy benefit managers
257	257	247and to the maximum extent permissible under federal law; provided, however, that such
258	258	248assessment will not result in any reduction of federal financial participation in Medicaid, the
259	259	249assessed amount for pharmacy benefit managers shall be not less than 25 per cent of the amount
260	260	250appropriated by the general court for the expenses of the commission less amounts collected
261	261	251from: (i) filing fees; (ii) fees and charges generated by the commission's publication or
262	262	252dissemination of reports and information; and (iii) federal matching revenues received for said
263	263	253expenses or received retroactively for expenses of predecessor agencies. Pharmacy benefit
264	264	254managers shall pay such assessed amount multiplied by the ratio of the pharmacy benefit
265	265	255manager’s gross revenue related to outpatient prescription drugs dispensed in the commonwealth 13 of 121
266	266	256or similar measure determined by the commission consistent with applicable federal
267	267	257requirements. In no event shall this assessment, when combined with an assessment of pharmacy
268	268	258benefit managers pursuant to section 7 of chapter 12C and a pharmacy benefit manager licensing
269	269	259fee pursuant to section 2 of chapter 176Y, exceed the commonwealth’s estimated expense in
270	270	260operating the pharmacy benefit manager licensure program.
271	271	261 Each pharmaceutical manufacturing company and each pharmacy benefit manager shall
272	272	262make a preliminary payment to the commission annually on October 1 in an amount equal to 1/2
273	273	263of the initial year’s total assessment and, for subsequent years, in an amount equal to 1/2 of the
274	274	264previous year's total assessment. Thereafter, each pharmaceutical manufacturing company and
275	275	265each pharmacy benefit manager shall pay, within 30 days of receiving notice from the
276	276	266commission, the balance of the total assessment for the current year as determined by the
277	277	267commission.
278	278	268 SECTION 25. Section 7 of said chapter 6D, as so appearing, is hereby amended by
279	279	269striking out, in line 35, the words “and (vi)” and inserting in place thereof the following words:-
280	280	270(vi) advance health equity; and (vii).
281	281	271 SECTION 26. Said chapter 6D is hereby further amended by striking out section 8, as so
282	282	272appearing, and inserting in place thereof the following section:-
283	283	273 Section 8. (a) Not later than October 1 of every year, the commission shall hold public
284	284	274hearings based on the report submitted by the center pursuant to section 16 of chapter 12C
285	285	275comparing: (i) the average of the annual growth in total health care expenditures during each
286	286	276year of the most recently concluded benchmark cycle to the health care cost growth benchmark
287	287	277for that benchmark cycle; and (ii) the growth in the affordability index pursuant to said section 14 of 121
288	288	27816 of said chapter 12C to the affordability benchmark. At said hearings, the commission shall
289	289	279examine the costs, prices and cost trends of health care providers, provider organizations, private
290	290	280and public health care payers, pharmaceutical manufacturing companies and pharmacy benefit
291	291	281managers and any relevant impact of private equity firms, real estate investment trusts and
292	292	282management services organizations on such costs, prices and cost trends, with particular
293	293	283attention to factors that contribute to cost growth within the commonwealth's health care system
294	294	284and trends in annual behavioral health expenditures.
295	295	285 (b) The attorney general may intervene in such hearings.
296	296	286 (c) Public notice of any hearing shall be provided not less than 60 days in advance.
297	297	287 (d) The commission shall identify as witnesses for the public hearing a representative
298	298	288sample of providers, provider organizations, payers, private equity firms, real estate investment
299	299	289trusts, management services organizations, pharmaceutical manufacturing companies, pharmacy
300	300	290benefit managers and others, including: (i) not less than 3 academic medical centers, including
301	301	291the 2 acute hospitals with the highest level of net patient service revenue; (ii) not less than 3
302	302	292disproportionate share hospitals, including the 2 hospitals whose largest per cent of gross patient
303	303	293service revenue is attributable to Title XVIII and XIX of the Social Security Act or other
304	304	294governmental payers; (iii) community hospitals from not less than l 3 separate regions of the
305	305	295commonwealth; (iv) freestanding ambulatory surgical centers from not less than 3 separate
306	306	296regions of the commonwealth; (v) community health centers from at not less than 3 separate
307	307	297regions of the commonwealth; (vi) the 5 commercial carriers with the highest enrollments in the
308	308	298commonwealth; (vii) any managed care organization that provides health benefits under Title
309	309	299XIX of the Social Security Act ; (viii) the group insurance commission; (ix) not less than 3 15 of 121
310	310	300municipalities that have adopted chapter 32B; (x) not less than 4 provider organizations which
311	311	301shall be from diverse geographic regions of the commonwealth, not less than 2 of which shall be
312	312	302certified as accountable care organizations and 1 of which shall be certified as a model ACO; (xi)
313	313	303at least 1 private equity firms, real estate investment trust or management services organization
314	314	304associated with a provider or provider organization; (xii) the assistant secretary for MassHealth;
315	315	305(xiii) not less than 3 representatives of pharmaceutical manufacturing companies doing business
316	316	306in the commonwealth or trade groups thereof; (xiv) 1 pharmacy benefit manager or trade groups
317	317	307thereof; and (xv) any witness identified by the attorney general or the center.
318	318	308 (e) Witnesses shall provide testimony under oath and subject to examination and cross
319	319	309examination by the commission, the executive director of the center and the attorney general at
320	320	310the public hearing in a manner and form to be determined by the commission, including, but not
321	321	311limited to: (i) in the case of providers and provider organizations, testimony concerning payment
322	322	312systems, care delivery models, payer mix, cost structures, administrative and labor costs, capital
323	323	313and technology cost, adequacy of public payer reimbursement levels, reserve levels, utilization
324	324	314trends, relative price, quality improvement and care-coordination strategies, investments in
325	325	315health information technology, the relation of private payer reimbursement levels to public payer
326	326	316reimbursements for similar services, efforts to improve the efficiency of the delivery system,
327	327	317efforts to reduce the inappropriate or duplicative use of technology and the impact of price
328	328	318transparency on prices; (ii) in the case of private and public payers, testimony concerning factors
329	329	319underlying premium cost and rate increases, the relation of reserves to premium costs, efforts by
330	330	320the payer to reduce the use of fee-for-service payment mechanisms, the payer's efforts to develop
331	331	321benefit design, network design and payment policies that enhance product affordability and
332	332	322encourage efficient use of health resources and technology including utilization of alternative 16 of 121
333	333	323payment methodologies, efforts by the payer to increase consumer access to health care
334	334	324information, efforts by the payer to promote the standardization of administrative practices, the
335	335	325impact of price transparency on prices and any other matters as determined by the commission;
336	336	326(iii) in the case of the assistant secretary for MassHealth, testimony concerning the structure,
337	337	327benefits, eligibility, caseload and financing of MassHealth and other Medicaid programs
338	338	328administered by the office of Medicaid or in partnership with other state and federal agencies and
339	339	329the agency’s activities to align or redesign said programs in order to encourage the development
340	340	330of more integrated and efficient health care delivery systems; (iv) in the case of private equity
341	341	331firms, real estate investment trusts or management services organization, testimony concerning
342	342	332changes to patient access to health care services or facilities, health outcomes, prices charged to
343	343	333insurers and patients, staffing levels, clinical workflow, financial stability and ownership
344	344	334structure as the result of an acquisition of a provider or provider organization, the amount of debt
345	345	335and equity leveraged in an acquisition of a provider or provider organization, additional debt
346	346	336taken on by a provider or provider organization after an acquisition, dividends paid out to
347	347	337investors, compensation including, but not limited to, base salaries, incentives, bonuses, stock
348	348	338options, deferred compensations, benefits and contingent payments to officers, managers and
349	349	339directors of provider organizations acquired, owned or managed, in whole or in part, by said
350	350	340private equity firms, real estate investment trusts or management services organizations, changes
351	351	341to real estate ownership and any leaseback agreements and management of clinical assets and
352	352	342any other matters as determined by the commission; and (v) in the case of pharmacy benefit
353	353	343managers and pharmaceutical manufacturing companies, testimony concerning factors
354	354	344underlying prescription drug costs and price changes including, but not limited to, the initial
355	355	345prices of drugs coming to market and subsequent price changes, changes in industry profit levels, 17 of 121
356	356	346marketing expenses, reverse payment patent settlements, impacts of manufacturer rebates,
357	357	347discounts and other price concessions on net pricing, availability of alternative drugs or
358	358	348treatments, corporate ownership organizational structure and any other matters as determined by
359	359	349the commission. The commission shall solicit testimony from a payer which has been identified
360	360	350by the center's annual report under subsection (a) of section 16 of chapter 12C as: (A) paying
361	361	351providers more than 10 per cent above or more than 10 per cent below the average relative price;
362	362	352or (B) entering into alternative payment contracts that vary by more than 10 per cent. A payer
363	363	353identified by the center's report shall explain the extent of price variation between the payer's
364	364	354participating providers and describe any efforts to reduce such price variation.
365	365	355 (f) If the center's annual report pursuant to subsection (a) of section 16 of chapter 12C
366	366	356finds that the average of the annual percentage changes in total health care expenditures during a
367	367	357benchmark cycle exceeded the health care cost growth benchmark for that benchmark cycle or
368	368	358the percentage change in the affordability index exceeded the affordability benchmark, the
369	369	359commission may identify additional witnesses for the public hearing. Witnesses shall provide
370	370	360testimony subject to examination and cross examination by the commission, the executive
371	371	361director of the center and attorney general at the public hearing in a manner and form to be
372	372	362determined by the commission, including, but not limited to: (i) testimony concerning
373	373	363unanticipated events that may have impacted the total health care cost expenditures and
374	374	364affordability, including, but not limited to, a public health crisis such as an outbreak of a disease,
375	375	365a public safety event or a natural disaster; (ii) testimony concerning trends in patient acuity,
376	376	366complexity or utilization of services; (iii) testimony concerning trends in input cost structures,
377	377	367including, but not limited to, the introduction of new pharmaceuticals, medical devices and other
378	378	368health technologies; (iv) testimony concerning the cost of providing certain specialty services, 18 of 121
379	379	369including, but not limited to, the provision of health care to children, cancer-related health care
380	380	370and medical education; (v) testimony related to unanticipated administrative costs for carriers,
381	381	371including, but not limited to, costs related to information technology, administrative
382	382	372simplification efforts, labor costs and transparency efforts; (vi) testimony related to costs due the
383	383	373implementation of state or federal legislation or government regulation; (vii) testimony related to
384	384	374premiums by market segment and community, plan and benefit design and cost sharing,
385	385	375including deductibles and co-pays; and (viii) any other factors that may have led to excessive
386	386	376health care cost growth.
387	387	377 (g) The commission shall annually compile a report for the most recently concluded
388	388	378benchmark cycle concerning spending trends, including primary care and behavioral health
389	389	379expenditures, affordability and the underlying factors influencing said spending trends. The
390	390	380report shall be based on the commission’s analysis of information provided at the hearings by
391	391	381witnesses, providers, provider organizations, payers, private equity firms, real estate investment
392	392	382trusts, management services organizations, pharmaceutical manufacturing companies and
393	393	383pharmacy benefit managers, registration data collected pursuant to section 11, data collected or
394	394	384analyzed by the center pursuant to sections 8 to 10A, inclusive, of chapter 12C and any other
395	395	385available information that the commission considers necessary to fulfill its duties under this
396	396	386section, as further defined in regulations promulgated by the commission. To the extent
397	397	387practicable, the report shall not contain any data that is likely to compromise the financial,
398	398	388competitive or proprietary nature of the information. The report shall be submitted to the chairs
399	399	389of the house and senate committees on ways and means and the chairs of the joint committee on
400	400	390health care financing and shall be published and made available to the public annually, not later
401	401	391than December 31, of each year. The report shall include recommendations for strategies to 19 of 121
402	402	392increase the efficiency of the health care system and promote affordability for individuals and
403	403	393families and analysis of specific spending trends that may impede the commonwealth’s ability to
404	404	394meet the health care cost growth benchmark, together with any drafts of legislation language
405	405	395necessary to implement said recommendations.
406	406	396 SECTION 27. Said chapter 6D is hereby further amended by striking out sections 9 and
407	407	39710, as so appearing, and inserting in place thereof the following 3 sections:-
408	408	398 Section 9. (a) Not later than April 15 of every year, the board shall establish the health
409	409	399care cost growth benchmark for a benchmark cycle consisting of the 2 calendar years beginning
410	410	400after the year in which the April 15 date occurs.
411	411	401 (b) The health care cost growth benchmark shall be equal to the average of the growth
412	412	402rate of potential gross state product established under section 7H½ of chapter 29 for each of the 2
413	413	403calendar years that comprise the benchmark cycle. The commission shall establish procedures to
414	414	404prominently publish the health care cost growth benchmark on the commission’s website.
415	415	405 (c) For all benchmark cycles through the cycle containing the calendar years 2039 and
416	416	4062040, if the commission determines that an adjustment in the health care cost growth benchmark
417	417	407is reasonably warranted, having first considered any testimony at a public hearing as required
418	418	408under subsection (d), the board of the commission may recommend a modification of the health
419	419	409care cost growth benchmark, in any amount as determined by the commission. The board shall
420	420	410submit notice of its recommendation for any modification to the joint committee on health care
421	421	411financing. Within 30 days of such filing, the joint committee may hold a public hearing on the
422	422	412board's proposed modification to the health care cost growth benchmark. Within 30 days of the
423	423	413public hearing, the joint committee may report its findings and proposed legislation, including its 20 of 121
424	424	414recommendation on whether to affirm or reject the boards’ recommendation, to the general court
425	425	415and provide a copy of its findings and proposed legislation to the board.
426	426	416 (d) Prior to making any recommended modification to the health care cost growth
427	427	417benchmark under subsection (c), the board shall hold a public hearing on any such recommended
428	428	418modification. The public hearing shall be based on the report submitted by the center pursuant to
429	429	419section 16 of chapter 12C comparing the average of the annual growth in total health care
430	430	420expenditures during each year of the most recently concluded benchmark cycle to the health care
431	431	421cost growth benchmark, any other data provided by the center and such other pertinent
432	432	422information or data as may be available to the board. The hearing shall examine the costs, prices
433	433	423and cost trends of health care provider, provider organization and private and public health care
434	434	424payer and any relevant impact of private equity firms, real estate investment trusts, management
435	435	425services organizations, pharmaceutical manufacturing companies and pharmacy benefit
436	436	426managers on such costs, prices and cost trends, with particular attention to factors that contribute
437	437	427to cost growth within the commonwealth’s health care system and whether, based on the
438	438	428testimony, information and data presented at the hearing, a modification in the health care cost
439	439	429growth benchmark is appropriate. The commission shall provide public notice of such hearing
440	440	430not less than 45 days prior to the date of the hearing, including notice to the joint committee on
441	441	431health care financing. The joint committee on health care financing may participate in the
442	442	432hearing. The commission shall identify as witnesses for the public hearing a representative
443	443	433sample of providers, provider organizations, payers, private equity firms, real estate investment
444	444	434trusts, management services organizations, pharmaceutical manufacturing companies, pharmacy
445	445	435benefit managers and such other interested parties as the commission may determine. Any other
446	446	436interested parties may testify at the hearing. 21 of 121
447	447	437 (e) Any recommendation of the commission to modify the health care cost growth
448	448	438benchmark under subsection (c) of this section shall be approved by a two-thirds vote of the
449	449	439board.
450	450	440 Section 9A. Not later than April 15 of every year, the board shall establish a health care
451	451	441affordability benchmark for the following calendar year. The commission shall establish
452	452	442procedures to prominently publish the annual affordability benchmark on the commission's
453	453	443website.
454	454	444 Section 10. (a) For the purpose of this section, “Health care entity” shall mean any health
455	455	445care entity identified by the center pursuant to section 18 of chapter 12C.
456	456	446 (b) The commission shall provide notice to a health care entity that the commission may
457	457	447analyze the health care spending performance of such health care entity and that such health care
458	458	448entity shall perform certain actions as provided in subsection (c); provided, however, that at the
459	459	449discretion of the commission, the commission may publicly identify the identities and
460	460	450performance results of such health care entity.
461	461	451 (c) The commission may require a performance improvement plan to be filed with the
462	462	452commission for a health care entity that is identified by the center under section 18 of chapter
463	463	45312C.
464	464	454 (d) In addition to the notice provided under subsection (b), the commission shall provide
465	465	455written notice to a health care entity that it determines must file a performance improvement
466	466	456plan. Within 45 days of receipt of such written notice, the health care entity shall either:
467	467	457 (1) file a performance improvement plan with the commission; or 22 of 121
468	468	458 (2) file an application with the commission to waive or extend the requirement to file a
469	469	459performance improvement plan.
470	470	460 (e) The health care entity may file documentation or supporting evidence with the
471	471	461commission to support the health care entity’s application to waive or extend the requirement to
472	472	462file a performance improvement plan. The commission shall require the health care entity to
473	473	463submit any other relevant information it deems necessary in considering the waiver or extension
474	474	464application; provided, however, that such information shall be made public at the discretion of
475	475	465the commission.
476	476	466 (f) The commission may waive or delay the requirement for a health care entity to file a
477	477	467performance improvement plan in response to a waiver or extension request filed under
478	478	468subsection (d) in light of all information received from the health care entity, based on a
479	479	469consideration of the following factors:
480	480	470 (1) the spending, price and utilization trends of the health care entity over time,
481	481	471independently and as compared to similar entities, and any demonstrated improvement to reduce
482	482	472spending or total medical expenses;
483	483	473 (2) any ongoing strategies or investments that the health care entity is implementing to
484	484	474improve future long-term efficiency and reduce spending growth;
485	485	475 (3) whether the factors that led to increased spending for the health care entity can
486	486	476reasonably be considered to be unanticipated and outside of the control of the entity. Such factors
487	487	477may include, but shall not be limited to, age and other health status adjusted factors and other
488	488	478cost inputs such as pharmaceutical expenses, medical device expenses and labor costs; 23 of 121
489	489	479 (4) the overall financial condition of the health care entity;
490	490	480 (5) a significant difference between the growth rate of potential gross state product and
491	491	481the growth rate of actual gross state product, as determined under section 7H½ of chapter 29; and
492	492	482 (6) any other factors the commission considers relevant.
493	493	483 (g) If the commission declines to waive or extend the requirement for the health care
494	494	484entity to file a performance improvement plan, the commission shall provide written notice to the
495	495	485health care entity that its application for a waiver or extension was denied and the health care
496	496	486entity shall file a performance improvement plan.
497	497	487 (h) A health care entity shall file a performance improvement plan: (A) within 45 days of
498	498	488receipt of a notice under subsection (d); (B) if the health care entity has requested a waiver or
499	499	489extension, within 45 days of receipt of a notice that such waiver or extension has been denied; or
500	500	490(C) if the health care entity is granted an extension, on the date given on such extension. The
501	501	491performance improvement plan shall identify the causes of the entity's excessive spending, and
502	502	492shall include, but not be limited to, specific strategies, adjustments and action steps the entity
503	503	493proposes to implement to improve spending performance. The proposed performance
504	504	494improvement plan shall include specific identifiable and measurable expected outcomes and a
505	505	495timetable for implementation. The timetable for a performance improvement plan shall not
506	506	496exceed 18 months.
507	507	497 (i) The commission shall approve any performance improvement plan that it determines
508	508	498is reasonably likely to address the underlying cause of the health care entity’s excessive spending
509	509	499and has a reasonable expectation for successful implementation. 24 of 121
510	510	500 (j) If the board determines that the performance improvement plan is unacceptable or
511	511	501incomplete, the commission may provide consultation on the criteria that have not been met and
512	512	502may allow an additional time period of not more than 30 calendar days, for resubmission.
513	513	503 (k) Upon approval of the proposed performance improvement plan, the commission shall
514	514	504notify the health care entity to begin implementation of the performance improvement plan.
515	515	505Public notice shall be provided by the commission on its website, identifying that the health care
516	516	506entity is implementing a performance improvement plan. Health care entities implementing an
517	517	507approved performance improvement plan shall be subject to additional reporting requirements
518	518	508and compliance monitoring, as determined by the commission. The commission shall assist the
519	519	509health care entity with the successful implementation of the performance improvement plan.
520	520	510 (l) Health care entities subject to a performance improvement plan shall, in good faith,
521	521	511work to implement such plan and may file amendments to the performance improvement plan at
522	522	512any point during the implementation of the performance improvement plan, subject to approval
523	523	513of the commission.
524	524	514 (m) At the conclusion of the timetable established in the performance improvement plan,
525	525	515the health care entity shall report to the commission regarding the outcome of the performance
526	526	516improvement plan. If the commission finds that the performance improvement plan was
527	527	517unsuccessful, the commission shall either: (i) extend the implementation timetable of the existing
528	528	518performance improvement plan; (ii) approve amendments to the performance improvement plan
529	529	519as proposed by the health care entity; (iii) require the health care entity to submit a new
530	530	520performance improvement plan under subsection (c), including requiring specific elements for 25 of 121
531	531	521approval; or (iv) waive or delay the requirement to file any additional performance improvement
532	532	522plans.
533	533	523 (n) Upon the successful completion of the performance improvement plan, the identity of
534	534	524the health care entity shall be removed from the list of entities currently implementing a
535	535	525performance improvement plan on the commission’s website.
536	536	526 (o) The commission may submit a recommendation for proposed legislation to the joint
537	537	527committee on health care financing if the commission determines that further legislative
538	538	528authority is needed to achieve the commonwealth’s health care quality and spending
539	539	529sustainability objectives, assist health care entities with the implementation of performance
540	540	530improvement plans or otherwise ensure compliance with the provisions of this section.
541	541	531 (p)(1) If the commission determines that a health care entity has: (i) willfully neglected to
542	542	532file a performance improvement plan with the commission within 45 days as required under
543	543	533subsection (d); (ii) failed to file an acceptable performance improvement plan in good faith with
544	544	534the commission; (iii) failed to implement the performance improvement plan in good faith; or
545	545	535(iv) knowingly failed to provide or falsified information required by this section to the
546	546	536commission, the commission may: (A) assess a civil penalty to the health care entity of not more
547	547	537than $500,000 for a first violation, not more than $750,000 for a second violation and not more
548	548	538than the amount of spending attributable to the health care entity that is in excess of the health
549	549	539care cost growth benchmark for a third or subsequent violation; provided, however, that a civil
550	550	540penalty assessed pursuant to one of the above clauses shall be a first offense if a previously
551	551	541assessed penalty was assessed pursuant to a different clause; (B) stay consideration of any
552	552	542material change notice submitted under section 13 of this chapter by the health care entity or any 26 of 121
553	553	543affiliates until the commission determines that the health care entity is in compliance with this
554	554	544section; and (C) notify the department of public health that the health care entity, if applying for
555	555	545a notice of determination of need, is not in compliance with this section. A civil penalty assessed
556	556	546under this subsection shall be deposited into the Healthcare Payment Reform Fund established
557	557	547under section 100 of chapter 194 of the acts of 2011. Except as otherwise expressly authorized
558	558	548under this section, the commission shall seek to promote compliance with this section and shall
559	559	549only impose a civil penalty as a last resort.
560	560	550
561	561	551 (q) The commission shall promulgate regulations necessary to implement this section;
562	562	552provided, however, that notice of any proposed regulations shall be filed with the joint
563	563	553committee on state administration and regulatory oversight and the joint committee on health
564	564	554care financing not less than180 days before adoption.
565	565	555 SECTION 28. Section 11 of said chapter 6D, as so appearing, is hereby amended by
566	566	556striking out, in line 3, the words “2 years” and inserting in place thereof the following words:- 1
567	567	557year.
568	568	558 SECTION 29. Said section 11 of said chapter 6D, as so appearing, is hereby further
569	569	559amended by striking out subsection (b) and inserting in place thereof the following subsection:-
570	570	560 (b) The commission shall require that all provider organizations report information
571	571	561detailed in section 9 of chapter 12C. The commission may specify additional data elements in a
572	572	562given reporting year to support the development of the state health plan or the focused
573	573	563assessments defined in section 22 of chapter 6D. 27 of 121
574	574	564 SECTION 30. Said section 11 of said chapter 6D, as so appearing, is hereby further
575	575	565amended by striking out subsection (d) and inserting in place thereof the following subsection:-
576	576	566 (d) The commission may enter into interagency agreements with the center and other
577	577	567state agencies to effectuate the goals of this section.
578	578	568 SECTION 31. Said chapter 6D is hereby further amended by striking out sections 12 and
579	579	56913, as so appearing, and inserting in place thereof the following 2 sections:-
580	580	570 Section 12. (a) The commission shall ensure the timely reporting of information required
581	581	571under section 11. The commission shall notify provider organizations of any applicable reporting
582	582	572deadlines; provided, that the commission shall notify, in writing, a provider organization that has
583	583	573failed to meet a reporting deadline and that failure to respond within 2 weeks of the receipt of the
584	584	574notice may result in penalties. The commission may assess a penalty against a provider
585	585	575organization that fails, without just cause, to provide the requested information within 2 weeks
586	586	576following receipt of the written notice required under this subsection of up to $10,000 per week
587	587	577for each week of delay after the 2-week period following provider organization's receipt of the
588	588	578written notice; provided, however, that the maximum annual penalty against a provider
589	589	579organization under this section shall be $500,000 per registration cycle. Amounts collected under
590	590	580this section shall be deposited in the Healthcare Payment Reform Fund established under section
591	591	581100 of chapter 194 of the Acts of 2011.
592	592	582 (b) Notwithstanding any general or special law to the contrary, any material change
593	593	583notice submitted under section 13 and any determination of need application submitted under
594	594	584sections 25B to 25G, inclusive, of chapter 111 by a provider organization that has failed to 28 of 121
595	595	585provide required information pursuant to section 11 and section 9 of chapter 12C shall be
596	596	586incomplete until such time as the provider organization has provided such required information.
597	597	587 (c) Nothing in this chapter shall require a provider organization which represents
598	598	588providers who collectively receive, less than $25,000,000 in annual net patient service revenue to
599	599	589be registered if such provider or provider organization is not a risk-bearing provider organization
600	600	590or is not owned or controlled, whether fully or partially, directly or indirectly, by a private equity
601	601	591firm.
602	602	592 Section 13. (a)(1) Every provider or provider organization shall, before making any
603	603	593material change to its operations or governance structure, submit notice to the commission, the
604	604	594center and the attorney general of such change not less than 60 days before the date of the
605	605	595proposed change, provided, however, that material changes shall include, but not be limited to:
606	606	596(i) significant expansions in a provider or provider organization’s capacity; (ii) a corporate
607	607	597merger, acquisition or affiliation of a provider or provider organization and a carrier; (iii)
608	608	598mergers or acquisitions of hospitals or hospital systems; (iv) acquisition of insolvent provider
609	609	599organizations; (v) significant new for-profit investment in, acquisitions of the assets of or
610	610	600ownership or direct or indirect control of a provider or provider organization by for-profit
611	611	601entities, including, but not limited to, private equity firms and management services
612	612	602organizations; (vi) substantial acquisition or sale of assets for an ownership share or for the
613	613	603purposes of a lease-back arrangement; (vii) conversion of a provider or provider organization
614	614	604from a non-profit entity to a for-profit entity; and (viii) mergers or acquisitions of provider
615	615	605organizations which will result in a provider organization having a dominant market share in a
616	616	606given service or region. 29 of 121
617	617	607 Within 30 days of receipt of a completed notice filed under the commission’s regulations,
618	618	608the commission shall conduct a preliminary review to determine whether the material change is
619	619	609likely to result in a significant impact on the commonwealth’s ability to meet the health care cost
620	620	610growth benchmark established in section 9, or on the competitive market. If the commission
621	621	611finds that the material change is likely to have a significant impact on the commonwealth’s
622	622	612ability to meet the health care cost growth benchmark, or on the competitive market, the
623	623	613commission may conduct a cost and market impact review under this section.
624	624	614 (2) If the commission determines that a proposed material change is likely to have a
625	625	615significant negative impact on health care consumers in the commonwealth, including through
626	626	616significantly increased costs, significantly reduced quality, or significantly impaired access to
627	627	617health care services, including for at-risk, underserved and government payer patient
628	628	618populations, the commission may recommend modifications to the proposed material change to
629	629	619mitigate such impacts. Notwithstanding any general or special law to the contrary, failure to
630	630	620modify the proposed material change to substantially address such impacts identified by the
631	631	621commission shall constitute an unfair business practice under chapter 93A subject to challenge
632	632	622pursuant to section 4 of said chapter 93A but not pursuant to sections 9 or 11 of said chapter
633	633	62393A. The commission shall notify the office of the attorney general of any provider or provider
634	634	624organization’s failure to modify the proposed material change to substantially address such
635	635	625impacts.
636	636	626 (b) In addition to the grounds for a cost and market impact review set forth in subsection
637	637	627(a), if the commission finds, based on the center’s benchmark cycle report under section 16 of
638	638	628chapter 12C, that the average of the annual percentage changes in total health care expenditures
639	639	629during each year of the benchmark cycle exceeded the health care cost growth benchmark for 30 of 121
640	640	630that benchmark cycle, the commission may conduct a cost and market impact review of any
641	641	631provider organization identified by the center under section 18 of said chapter 12C.
642	642	632 (c)(1) The commission shall initiate a cost and market impact review by sending the
643	643	633provider or provider organization notice of a cost and market impact review, which shall explain
644	644	634the basis for the review and the particular factors that the commission seeks to examine through
645	645	635the review. The provider or provider organization shall submit to the commission, within 21 days
646	646	636of the commission’s notice, a written response to the notice, including, but not limited to, any
647	647	637information or documents sought by the commission that are described in the commission’s
648	648	638notice. The commission may require that any provider, provider organization, payer, investor or
649	649	639other party associated with a given transaction submit documents and information in connection
650	650	640with a notice of material change or a cost and market impact review under this section. The
651	651	641commission may also require, for a period of 5 years following the completion of a material
652	652	642change, that any provider or provider organization submit data and information to assess the
653	653	643post-transaction impacts of a material change and compliance with any commitments or
654	654	644conditions agreed to by the parties. The commission shall keep confidential all nonpublic
655	655	645information and documents obtained under this section and shall not disclose the information or
656	656	646documents to any person without the consent of the provider or payer that produced the
657	657	647information or documents, except in a preliminary report or final report under this section if the
658	658	648commission believes that such disclosure should be made in the public interest after taking into
659	659	649account any privacy, trade secret or anti-competitive considerations. The confidential
660	660	650information and documents shall not be public records and shall be exempt from disclosure
661	661	651under clause Twenty-sixth of section 7 of chapter 4 or section 10 of chapter 66. 31 of 121
662	662	652 (2) For any material change involving significant new for-profit investment in,
663	663	653acquisitions of the assets of or ownership or direct or indirect control of a provider or provider
664	664	654organization by a for-profit entity, the for-profit entity, and the parent company or person or
665	665	655persons controlling the for-profit entity, if any, will be required to submit, at a minimum, the
666	666	656following information to complete the notice: (i) information regarding the capital structure,
667	667	657general financial condition, ownership and management of the for-profit entity and any person
668	668	658controlling the for-profit entity; (ii) the identity and relationship of every member of the for-
669	669	659profit entity; (iii) fully audited financial information for the preceding 5 fiscal years or for such
670	670	660lesser period as the for-profit entity and any predecessors thereof shall have been in existence;
671	671	661(iv) any plans or proposals to liquidate such provider or provider organization, to sell its assets or
672	672	662merge or consolidate it with any person, or to make any other material change in its business or
673	673	663corporate structure or management; (v) fully audited financial information of all health care
674	674	664entities acquired by the for-profit entity, the parent company and person or persons controlling
675	675	665the for-profit entity, for the preceding 5 fiscal years or for such lesser period as the for-profit
676	676	666entity and any predecessors thereof shall have been in existence as well as other financial
677	677	667information the commission deems relevant, including, but not limited to, bankruptcy filings,
678	678	668sales of non-clinical assets and dividend recapitalizations; (vi) operational information regarding
679	679	669health care entities acquired by the acquiring party or person or persons controlling the acquiring
680	680	670party for the preceding 10 fiscal years or for such lesser period as such acquiring party and any
681	681	671predecessors thereof shall have been in existence, including, but not limited to, reduction or
682	682	672closure of health care services; and (vii) such additional information as the commission may
683	683	673deem necessary or appropriate for the protection of essential health services or to evaluate the
684	684	674material change notice. 32 of 121
685	685	675 (d) A cost and market impact review may examine factors relating to the provider or
686	686	676provider organization’s business and its relative market position, including, but not limited to: (i)
687	687	677the provider or provider organization’s size and market share within its primary service areas by
688	688	678major service category and within its dispersed service areas; (ii) the provider or provider
689	689	679organization’s prices for services, including its relative price compared to other providers for the
690	690	680same services in the same market; (iii) the provider or provider organization’s health status
691	691	681adjusted total medical expense, including its health status adjusted total medical expense
692	692	682compared to similar providers; (iv) the quality of the services provided by the provider or
693	693	683provider organization, including patient experience; (v) provider cost and cost trends in
694	694	684comparison to total health care expenditures statewide; (vi) the availability and accessibility of
695	695	685services similar to those provided, or proposed to be provided, through the provider or provider
696	696	686organization within its primary service areas and dispersed service areas; (vii) the provider or
697	697	687provider organization’s impact on competing options for the delivery of health care services
698	698	688within its primary service areas and dispersed service areas, including, if applicable, the impact
699	699	689on existing service providers of a provider or provider organization’s expansion, affiliation,
700	700	690merger or acquisition, to enter a primary or dispersed service area in which it did not previously
701	701	691operate; (viii) the methods used by the provider or provider organization to attract patient volume
702	702	692and recruit or acquire health care professionals or facilities; (ix) the role of the provider or
703	703	693provider organization in serving at-risk, underserved and government payer patient populations,
704	704	694including individuals with behavioral, substance use disorder and mental health conditions,
705	705	695within its primary service areas and dispersed service areas; (x) the role of the provider or
706	706	696provider organization in providing low margin or negative margin services within its primary
707	707	697service areas and dispersed service areas; (xi) consumer concerns, including, but not limited to, 33 of 121
708	708	698complaints or other allegations that the provider or provider organization has engaged in any
709	709	699unfair method of competition or any unfair or deceptive act or practice; (xii) the cumulative
710	710	700impact of mergers, acquisitions, affiliations or joint ventures on the health care market over a
711	711	701reasonable period of time, as defined by the commission; (xiii) alignment with the state health
712	712	702plan and any focused assessments conducted pursuant to section 22; and (xiv) any other factors
713	713	703that the commission determines to be in the public interest.
714	714	704 (e) The commission shall make factual findings and issue a preliminary report on the cost
715	715	705and market impact review. In the report, the commission shall identify any provider or provider
716	716	706organization that meets all of the following: (i) the provider or provider organization has, or
717	717	707likely will have as a result of the proposed material change, a dominant market share for the
718	718	708services it provides; (ii) the provider or provider organization charges, or likely will charge as a
719	719	709result of the proposed material change, prices for services that are materially higher than the
720	720	710median prices charged by all other providers for the same services in the same market; and (iii)
721	721	711the provider or provider organization has, or likely will have as a result of the proposed material
722	722	712change, a health status adjusted total medical expense that is materially higher than the median
723	723	713total medical expense of comparable providers in the same area.
724	724	714 (f) Within 30 days after issuance of a preliminary report, the provider or provider
725	725	715organization may respond in writing to the findings in the report. The commission shall then
726	726	716issue its final report. The commission shall refer to the attorney general its report on any provider
727	727	717or provider organization that meets all 3 criteria under subsection (e). The commission shall
728	728	718issue its final report on the cost and market impact review within 185 days from the date that the
729	729	719provider or provider organization has submitted a completed notice to the commission under the
730	730	720commission’s regulations; provided, however, that the provider or provider organization has 34 of 121
731	731	721certified substantial compliance with the commission’s requests for data and information
732	732	722pursuant to subsection (c) within 21 days of the commission’s notice or by a later date set by
733	733	723mutual agreement of the provider or provider organization and the commission.
734	734	724 (g) Nothing in this section shall prohibit a proposed material change under subsection (a);
735	735	725provided, however, that any proposed material change shall not be completed: (i) until not later
736	736	726than 30 days after the commission has issued its final report; or (ii) if the attorney general brings
737	737	727an action as described in paragraph (2) of subsection (a) or subsection (h), while such action is
738	738	728pending and prior to a final judgment being issued by a court of competent jurisdiction,
739	739	729whichever is later.
740	740	730 (h) A provider or provider organization that meets the criteria in subsection (e) has
741	741	731engaged, or through a material change will engage, in an unfair method of competition or unfair
742	742	732and deceptive trade practice subject to challenge pursuant to section 4 of chapter 93A, but not
743	743	733sections 9 or 11 of said chapter 93A. The attorney general may take action under said chapter
744	744	73493A or any other law to protect consumers in the health care market, including by bringing an
745	745	735action seeking to restrain such violation of said chapter 93A. The commission’s final report may
746	746	736be evidence in any such action brought by the attorney general.
747	747	737 (i) Nothing in this section shall limit the authority of the attorney general to protect
748	748	738consumers in the health care market under any other law.
749	749	739 (j) The commission shall adopt regulations for conducting cost and market impact
750	750	740reviews and for administering this section. These regulations shall include definitions of material
751	751	741change and non-material change, primary service areas, dispersed service areas, dominant market
752	752	742share, materially higher prices, materially higher health status adjusted total medical expenses 35 of 121
753	753	743and any other terms as necessary to provide market participants with appropriate notice. These
754	754	744regulations may identify filing thresholds in connection with this section; provided, however,
755	755	745that the commission shall determine that multiple mergers, acquisitions or affiliations over time
756	756	746may together meet such thresholds. All regulations promulgated by the commission shall comply
757	757	747with chapter 30A.
758	758	748 (k) Nothing in this section shall limit the application of other laws or regulations that may
759	759	749be applicable to a provider or provider organization, including laws and regulations governing
760	760	750insurance.
761	761	751 (l) Upon issuance of its final report pursuant to subsection (f), the commission shall
762	762	752provide a copy of said final report to the department of public health. The final report shall be
763	763	753included in the written record and considered by the department of public health during its
764	764	754review of an application for determination of need under section 25C of chapter 111 and
765	765	755considered where relevant in connection with licensure or other regulatory actions involving the
766	766	756provider or provider organization.
767	767	757 SECTION 32. Said chapter 6D is hereby further amended by adding the following 2
768	768	758sections:-
769	769	759 Section 22. (a)(1) Not less than once every 5 years, the commission shall develop a state
770	770	760health plan in consultation with the executive office of health and human services, the
771	771	761department of public health, the office of Medicaid, the department of mental health, the division
772	772	762of insurance, the executive office of elder affairs, the center for health information and analysis
773	773	763and other state agencies as appropriate. 36 of 121
774	774	764 (2) The state health plan shall identify: (i) the current and anticipated needs of the
775	775	765commonwealth for health care services, providers, programs and facilities; (ii) the existing health
776	776	766care resources available to meet those needs; (iii) recommendations for the appropriate supply
777	777	767and distribution of resources, workforce, programs, capacities, technologies and services on a
778	778	768statewide and regional basis; (iv) major barriers preventing communities and residents from
779	779	769accessing needed health care; (v) priorities for addressing those barriers; and (vi)
780	780	770recommendations for any further legislative or other state action to assist the commonwealth in
781	781	771achieving the recommendations identified in the plan.
782	782	772 (3) The state health plan shall be based on data from all available sources, including data
783	783	773collected by the commission, the center for health information and analysis, the executive office
784	784	774of health and human services, the department of public health, the office of Medicaid, the
785	785	775department of mental health, the division of insurance, the executive office of elder affairs, the
786	786	776board of registration in medicine, the bureau of health professions licensure, the office of the
787	787	777attorney general and other state agencies as appropriate. All such agencies shall provide data and
788	788	778information necessary for the commission to create the plan.
789	789	779 (4) The state health plan shall include recommendations across a range of health care
790	790	780services, including, but not limited to: (i) acute care; (ii) non-acute care; (iii) specialty care,
791	791	781including, but not limited to, burn, coronary care, cancer care, neonatal care, post-obstetric and
792	792	782post-operative recovery care, pulmonary care, renal dialysis and surgical, including trauma and
793	793	783intensive care units; (iv) skilled nursing facilities; (v) assisted living facilities; (vi) long-term care
794	794	784facilities; (vii) ambulatory surgical centers; (viii) office-based surgical centers; (ix) urgent care
795	795	785centers; (x) home health; (xi) adult and pediatric behavioral health and mental health services
796	796	786and supports; (xii) substance use disorder treatment and recovery services; (xiii) emergency care; 37 of 121
797	797	787(xiv) ambulatory care services; (xv) primary care resources; (xvi) pediatric care services; (xvii)
798	798	788pharmacy and pharmacological services; (xviii) family planning services; (xix) obstetrics and
799	799	789gynecology and maternal health services; (xx) allied health services, including, but not limited
800	800	790to, optometric care, chiropractic services, oral health care and midwifery services; (xxi) federally
801	801	791qualified health centers and free clinics; (xxii) technologies or equipment defined as innovative
802	802	792services or new technologies by the department of public health pursuant to section 25B of
803	803	793chapter 111; (xxiii) hospice and palliative care service; (xxiv) health screening and early
804	804	794intervention services; and (xxv) any other service or resource identified by the commission.
805	805	795 (5) The goal of the state health plan shall be to promote the appropriate and equitable
806	806	796distribution of health care resources across geographic regions of the commonwealth based on
807	807	797the needs of the population on a statewide basis and the needs of particular geographic and
808	808	798demographic groups. The state health plan shall seek to support the commonwealth's goals of: (i)
809	809	799maintaining and improving the quality of and access to health care services; (ii) ensuring a stable
810	810	800and adequate health care workforce; (iii) meeting the health care cost growth benchmark
811	811	801established pursuant to section 9; (iv) supporting innovative health care delivery and alternative
812	812	802payment models as identified by the commission; (v) reducing unnecessary duplication of health
813	813	803care resources; (vi) advancing health equity and addressing disparities in the health care system
814	814	804based on the needs of particular demographic factors, including, but not limited to, race,
815	815	805ethnicity, immigration status, sexual orientation, gender identity, geographic location, age,
816	816	806language spoken, ability and socioeconomic status; (vii) integrating oral health, mental health,
817	817	807behavioral and substance use disorder treatment services with overall medical care; (viii)
818	818	808aligning housing, health care and home care to improve overall health outcomes and reduce
819	819	809costs; (ix) tracking trends in utilization and promoting the best standards of care; and (x) 38 of 121
820	820	810ensuring equitable access to health care resources across geographic regions of the
821	821	811commonwealth.
822	822	812 (6) The commission shall consult with the advisory council established pursuant to
823	823	813section 4 in the development of the state health plan.
824	824	814 (7) In developing the state health plan, the commission, in consultation with the
825	825	815department of public health, shall conduct at least 1 public hearing seeking input on the state
826	826	816health plan and shall give interested persons an opportunity to submit their views orally and in
827	827	817writing. In addition, the commission may create and maintain a website to allow members of the
828	828	818public to submit comments electronically and review comments submitted by others.
829	829	819 (8) The commission may require the submission of data and documents from providers,
830	830	820provider organizations and payers to support creation of the state health plan; provided, that the
831	831	821information is not already required to be reported to another state agency and accessible to the
832	832	822commission. Nonpublic clinical, financial, strategic or operational documents or information
833	833	823provided to the commission in connection with this section shall be subject to section 2A.
834	834	824 (b)(1) In addition to the state health plan, the commission shall conduct regular, focused
835	835	825assessments of provider supply and distribution in relation to projected need in at least 1 specific
836	836	826service line. Each assessment shall be conducted in consultation with other state agencies as
837	837	827appropriate, including, but not limited to, the executive office of health and human services, the
838	838	828department of public health, the department of mental health, the office of Medicaid, the division
839	839	829of insurance, the center for health information and analysis, the executive office of elder affairs,
840	840	830the board of registration in medicine, the bureau of health professions licensure and the office of
841	841	831the attorney general. All such agencies shall provide data and information necessary for the 39 of 121
842	842	832commission to conduct the assessment. The commission shall consider available state and
843	843	833national data and academic research on health service supply and need and relevant community
844	844	834health needs assessments by non-profit hospitals and other organizations and other individual
845	845	835and community statements of need.
846	846	836 (2) Each focused assessment shall examine at least 1 specific service line and at least 1
847	847	837relevant region and may examine other factors in the public interest, such as populations served,
848	848	838as appropriate. The service lines and regions shall be identified and prioritized for assessment by
849	849	839the commission in consultation with the above-referenced agencies, as consistent with available
850	850	840resources. In prioritizing service lines and regions, the commission may consider factors
851	851	841including, but not limited to: (i) services with limited alternatives or substitutions; (ii) services
852	852	842where supply has been shown to be misaligned with need nationally or in academic research; (iii)
853	853	843services or regions undergoing significant changes in ownership, supply, or distribution; (iv)
854	854	844services or regions with evidence of access challenges or barriers, particularly for vulnerable
855	855	845populations; (v) input from the advisory council established pursuant to section 4; and (vi)
856	856	846requests for analysis from the executive office of health and human services or other agencies;
857	857	847provided, that prioritized service lines under this paragraph shall include primary care and
858	858	848behavioral health.
859	859	849 (3) Each assessment may include findings that include, but are not limited to: (i) the
860	860	850extent to which supply of a given service line aligns with projected need at the statewide or
861	861	851regional level; (ii) health system factors driving any documented health disparities; (iii) services
862	862	852or providers, including in a specific geographic area, that are critical to the proper functioning of
863	863	853the health care system; (iv) estimates of where and how many additional units of service would
864	864	854be needed in the state or in a specific geographic area to meet projected need; (v) identification 40 of 121
865	865	855of barriers impacting accessibility of available supply by specific populations; and (vi) policy
866	866	856recommendations to address the drivers of disparities, access barriers and areas of misalignment
867	867	857of need and supply.
868	868	858 (4) The commission shall consult with the advisory council established pursuant to
869	869	859section 4 in the development of such focused assessments.
870	870	860 (5) The commission, in consultation with the department of public health, shall conduct
871	871	861at least 1 public hearing seeking input on each focused assessment and shall give interested
872	872	862persons an opportunity to submit testimony orally and in writing.
873	873	863 (6) The commission may require the submission of data and documents from payers,
874	874	864providers or provider organizations that offer a service that is the subject of an assessment
875	875	865conducted under this section; provided, that the information is not already reported to another
876	876	866state agency and made accessible to the commission. Nonpublic clinical, financial, strategic or
877	877	867operational documents or information provided to the commission in connection with this section
878	878	868shall be subject to section 2A.
879	879	869 (c) The commission shall publish analyses, reports and interpretations of information
880	880	870collected pursuant to this section to promote awareness of the distribution and nature of health
881	881	871care resources in the commonwealth.
882	882	872 (d) Biennially, not later than January 1, the commission shall file a report with the joint
883	883	873committee on health care financing , which shall include, but not be limited to: (i) a summary of
884	884	874the current state health plan and a description of focused assessments conducted during the past 2
885	885	875years; (ii) a summary of actions taken by the commission and progress made toward developing 41 of 121
886	886	876the state health plan and focused assessments during the past 2 years; and (iii) recommendations
887	887	877for further legislative action to assist the commission in its implementation of this section.
888	888	878 Section 23. (a) A provider or a provider organization in which a private equity firm has a
889	889	879financial interest shall not: (i) meet or exceed the maximum adjusted debt to adjusted EBITDA
890	890	880ratio; (ii) otherwise become highly leveraged, as determined by the commission; (iii) transact
891	891	881with an unsafe financial actor; (iv) for the period during which the private equity firm has a
892	892	882financial interest in the provider or provider organization, (A) provide capital distributions,
893	893	883including, but not limited, to cash dividends, stock dividends that are not strictly dilutive or any
894	894	884other similar distributions, (B) perform stock buybacks, stock redemptions or similar transactions
895	895	885or (C) pay to a private equity firm management fees or similar fees or costs; or (v) perform any
896	896	886other action or exceed any other metric the commission determines may cause a provider or
897	897	887provider organization to become financially distressed.
898	898	888 (b) Within 30 days of the commission receiving a referral from the center pursuant to
899	899	889paragraph (4) of subsection (e) of section 9 of chapter 12C or the commission becoming aware of
900	900	890a potential violation of subsection (a) pursuant to the filing of a completed notice of material
901	901	891change under section 13, the commission shall make a determination of whether there has been a
902	902	892violation. If the commission determines a violation has occurred, the commission shall require
903	903	893the provider to come into compliance with said subsection (a) and may set conditions that the
904	904	894provider or provider organization shall follow to come into compliance. The commission shall
905	905	895notify the provider or provider organization in writing of its determination, conditions, if any,
906	906	896and reasoning. The provider or provider organization shall have not less than 30 days to respond
907	907	897in writing and 10 days to request a hearing from the date of notification. If a hearing is requested,
908	908	898the hearing shall be held within 30 days of the commission’s receipt of the request. Within 10 42 of 121
909	909	899days of receiving written comments or holding any requested hearing, whichever is later, the
910	910	900commission shall notify the provider or provider organization in writing that the provider or
911	911	901provider organization is required to come into compliance with section (a) and which conditions,
912	912	902if any, shall go into effect. Upon providing notice, such requirements and conditions, if any, shall
913	913	903go into effect.
914	914	904 In making the determinations pursuant to subsection (a), the commission may consider all
915	915	905publicly available data and documents, including information submitted to the commission and
916	916	906the center under any authority. The commission may also solicit additional non-public
917	917	907information from providers to the extent necessary to achieve the purposes of this section. The
918	918	908commission shall keep confidential all nonpublic information and documents obtained under this
919	919	909section, and such information shall not be public records and shall be exempt from disclosure
920	920	910under clause Twenty-sixth of section 7 of chapter 4 or section 10 of chapter 66.
921	921	911 (c)(1) Within 3 months, or a shorter reasonable time as determined by the commission,
922	922	912the commission shall determine whether the provider or provider organization has substantially
923	923	913complied with its conditions or if no conditions were set, whether the provider or provider
924	924	914organization has come into compliance with subsection (a). The commission shall notify the
925	925	915provider or provider organization of its determination and reasoning, and the provider or
926	926	916provider organization shall have not less than 30 days to respond in writing and 10 days to
927	927	917request a hearing from the date of notification. If a hearing is requested, the hearing shall be held
928	928	918within 30 days of the commission’s receipt of the request. Within 10 days of receiving written
929	929	919comments and holding any requested hearing, whichever is later, the commission shall make a
930	930	920final determination and notify the provider or provider organization of the determination in
931	931	921writing. 43 of 121
932	932	922 (2) If the commission makes a final determination that the provider or provider
933	933	923organization has failed to substantially implement the commission’s conditions, or, if no
934	934	924conditions were set, to come in compliance with subsection (a), the department of public health
935	935	925may collect the bond deposited. The commission shall notify the department of public health of
936	936	926its determination and refer the provider or provider organization to the attorney general.
937	937	927 (3) Failure to substantially implement the commission’s conditions, or, if no conditions
938	938	928are set, failure to come in compliance with subsection (a) shall constitute a violation of said
939	939	929chapter 93A. Only the attorney general, or an organization representing workers who: (i) worked
940	940	930for the provider or provider organization; (ii) worked in the provider or provider organization’s
941	941	931facilities, if any; or (iii) contracted with the provider or provider organization, may bring an
942	942	932action under chapter 93A for such a violation. The commission’s final determination may be
943	943	933used as prima facie evidence of a violation of said chapter 93A.
944	944	934 (d) A private equity firm shall deposit, upon submission of a notice of material change
945	945	935pursuant to section 13 of chapter 6D, a bond with the department of public health ensuring that
946	946	936the provisions of subsection (a) shall not be violated; provided, however, that the private equity
947	947	937firm shall not use any of the provider or provider organization’s assets or property as security for
948	948	938the bond, pay for the bond by placing debt on the provider or provider organization or otherwise
949	949	939permit the provider or provider organization to pay the bond on the private equity firm’s behalf
950	950	940or allow the provider or provider organization to be liable for the bond.
951	951	941 SECTION 33. Section 5A of chapter 12 of the General Laws, as so appearing, is hereby
952	952	942amended by striking out, in line 26, the words “or ‘knowingly’” and inserting in place thereof the
953	953	943following words:- , “knowingly” or “knows”. 44 of 121
954	954	944 SECTION 34. Said section 5A of said chapter 12, as so appearing, is hereby further
955	955	945amended by inserting after the definition of “Overpayment” the following definition:-
956	956	946 “Ownership or investment interest”, any: (1) direct or indirect possession of equity in the
957	957	947capital, stock or profits totaling more than 10 per cent of an entity; (2) interest held by an
958	958	948investor or group of investors who engages in the raising or returning of capital and who invests,
959	959	949develops or disposes of specified assets; (3) interest held by a pool of funds by investors,
960	960	950including a pool of funds managed or controlled by private limited partnerships, if those
961	961	951investors or the management of that pool or private limited partnership employ investment
962	962	952strategies of any kind to earn a return on that pool of funds; or (4) interest held by a real estate
963	963	953investment trust.
964	964	954 SECTION 35. Section 5B of said chapter 12, as so appearing, is hereby amended by
965	965	955striking out, in line 29, the word “or”, the second time it appears.
966	966	956 SECTION 36. Said section 5B of said chapter 12, as so appearing, is hereby further
967	967	957amended by inserting after the word “applicable”, in lines 38 and 39, the following words:- ; or
968	968	958(11) has an ownership or investment interest in any person who violates clauses (1) to (10),
969	969	959inclusive, knows about the violation, and fails to disclose the violation to the commonwealth or a
970	970	960political subdivision thereof within 60 days of identifying the violation.
971	971	961 SECTION 37. Section 11N of said chapter 12, as so appearing, is hereby amended by
972	972	962striking out, in line 7, the words “or provider organization” and inserting in place thereof the
973	973	963following words:- , provider organization, private equity firm, real estate investment trust,
974	974	964management services organization, pharmaceutical manufacturing company and pharmacy
975	975	965benefit manager. 45 of 121
976	976	966 SECTION 38. Said section 11N of said chapter 12, as so appearing, is hereby further
977	977	967amended by striking out subsection (b) and inserting in place thereof the following subsection:-
978	978	968 (b) The attorney general may investigate any provider organization referred to the
979	979	969attorney general by the health policy commission under chapter 6D to determine whether the
980	980	970provider organization engaged in unfair methods of competition or anti-competitive behavior in
981	981	971violation of chapter 93A or any other law, and, if appropriate, take action under said chapter 93A
982	982	972or any other law to protect consumers in the health care market, including, but not limited to, an
983	983	973action for injunctive relief.
984	984	974 SECTION 39. Section 1 of chapter 12C of the General Laws, as so appearing, is hereby
985	985	975amended by inserting after the definition of “Ambulatory surgical center services” the following
986	986	976definition:-
987	987	977 “Benchmark cycle”, a period of 2 consecutive calendar years during which the projected
988	988	978annualized growth rate in total health care expenditures in the commonwealth is calculated
989	989	979pursuant to section 9 of chapter 6D and monitored pursuant to section 10 of said chapter 6D.
990	990	980 SECTION 40. Said section 1 of said chapter 12C, as so appearing, is hereby further
991	991	981amended by inserting after the definition of “Fee-for-service” the following definition:-
992	992	982 “Financial interest”, when a private equity firm or its corporate affiliate has a direct or
993	993	983indirect ownership share of, or controlling interest in, or is a holder of significant debt from a
994	994	984provider or provider organization or the provider or provider organization’s corporate affiliates 46 of 121
995	995	985 SECTION 41. Said section 1 of said chapter 12C, as so appearing, is hereby further
996	996	986amended by striking out the definition of “Health care cost growth benchmark” and inserting in
997	997	987place thereof the following 2 definitions:-
998	998	988 “Health care cost growth benchmark”, the projected annualized growth rate in total health
999	999	989care expenditures in the commonwealth during a benchmark cycle as established in section 9 of
1000	1000	990chapter 6D.
1001	1001	991 “Health care entity”, as defined in section 1 of chapter 6D.
1002	1002	992 SECTION 42. Said section 1 of said chapter 12C, as so appearing, is hereby further
1003	1003	993amended by inserting after the definition of “Health care services” the following 2 definitions:-
1004	1004	994 “Health disparities”, preventable differences in the burden of disease, injury, violence or
1005	1005	995opportunities to achieve optimal health that are experienced by socially disadvantaged
1006	1006	996populations.
1007	1007	997 “Health equity”, the state in which a health system offers the infrastructure, facilities,
1008	1008	998services, geographic coverage, affordability and all other relevant features, conditions and
1009	1009	999capabilities that will provide all people with the opportunity and reasonable expectation that they
1010	1010	1000can reach their full health potential and well-being and are not disadvantaged in access to health
1011	1011	1001care by their race, ethnicity, language, disability, age, gender, gender identity, sexual orientation,
1012	1012	1002social class, intersections among these communities or identities or their socially determined
1013	1013	1003circumstances. 47 of 121
1014	1014	1004 SECTION 43. Said section 1 of said chapter 12C, as so appearing, is hereby further
1015	1015	1005amended by inserting after the definition of “Major service category” the following 2
1016	1016	1006definitions:-
1017	1017	1007 “Management services organization”, a business that provides management or
1018	1018	1008administrative services to a provider or provider organization for compensation. “Maximum
1019	1019	1009adjusted debt to adjusted EBITDA ratio”, the highest ratio of total adjusted debt to adjusted
1020	1020	1010earnings before interest, taxes, depreciation and amortization the commission determines that a
1021	1021	1011provider or provider organization can have without becoming financially unstable; provided
1022	1022	1012further, that the commission, in consultation with the center, shall establish a standard method of
1023	1023	1013calculating and reporting total adjusted debt and adjusted earnings before interest, taxes,
1024	1024	1014depreciation and amortization; and provided further, that the methodology and reporting shall
1025	1025	1015include capitalized lease obligations.
1026	1026	1016 SECTION 44. Said section 1 of said chapter 12C, as so appearing, is hereby further
1027	1027	1017amended by inserting after the definition of “Patient-centered medical home” the following 3
1028	1028	1018definitions:-
1029	1029	1019 “Payer”, any entity, other than an individual, that pays providers for the provision of
1030	1030	1020health care services; provided, that “payer” shall include both governmental and private entities;
1031	1031	1021provided further, that “payer” shall include self-insured plans to the extent allowed under the
1032	1032	1022federal Employee Retirement Income Security Act of 1974.
1033	1033	1023 “Pharmaceutical manufacturing company”, an entity engaged in the: (i) production,
1034	1034	1024preparation, propagation, compounding, conversion or processing of prescription drugs, directly
1035	1035	1025or indirectly, by extraction from substances of natural origin, independently by means of 48 of 121
1036	1036	1026chemical synthesis or by a combination of extraction and chemical synthesis; or (ii) packaging,
1037	1037	1027repackaging, labeling, relabeling or distribution of prescription drugs; provided, however, that
1038	1038	1028“pharmaceutical manufacturing company” shall not include a wholesale drug distributor licensed
1039	1039	1029under section 36B of chapter 112 or a retail pharmacist registered under section 39 of said
1040	1040	1030chapter 112.
1041	1041	1031 “Pharmacy benefit manager”, a person, business or other entity, however organized, that,
1042	1042	1032directly or through a subsidiary, provides pharmacy benefit management services for prescription
1043	1043	1033drugs and devices on behalf of a health benefit plan sponsor, including, but not limited to, a self-
1044	1044	1034insurance plan, labor union or other third-party payer; provided, however, that pharmacy benefit
1045	1045	1035management services shall include, but not be limited to: (i) the processing and payment of
1046	1046	1036claims for prescription drugs; (ii) the performance of drug utilization review; (iii) the processing
1047	1047	1037of drug prior authorization requests; (iv) pharmacy contracting; (v) the adjudication of appeals or
1048	1048	1038grievances related to prescription drug coverage contracts; (vi) formulary administration; (vii)
1049	1049	1039drug benefit design; (viii) mail and specialty drug pharmacy services; (ix) cost containment; (x)
1050	1050	1040clinical, safety and adherence programs for pharmacy services; and (xi) managing the cost of
1051	1051	1041covered prescription drugs; provided further, that “pharmacy benefit manager” shall include a
1052	1052	1042health benefit plan sponsor that does not contract with a pharmacy benefit manager and manages
1053	1053	1043its own prescription drug benefits unless specifically exempted by the commission.
1054	1054	1044 SECTION 45. Said section 1 of said chapter 12C, as so appearing, is hereby further
1055	1055	1045amended by inserting after the definition of “Primary service area” the following definition:-
1056	1056	1046 “Private equity firm”, a publicly traded or non-publicly traded company that collects
1057	1057	1047capital investments from individuals or entities and purchases, as a parent company or through 49 of 121
1058	1058	1048another entity that it completely or partially owns or controls, a direct or indirect ownership share
1059	1059	1049of or controlling interest in, or otherwise obtains a financial interest in, a provider, provider
1060	1060	1050organization or management services organization; provided, however, that “private equity firm”
1061	1061	1051shall not include venture capital firms exclusively funding startups or other early-stage
1062	1062	1052businesses.
1063	1063	1053 SECTION 46. Said section 1 of said chapter 12C, as so appearing, is hereby further
1064	1064	1054amended by striking out the definition of “Provider organization” and inserting in place thereof
1065	1065	1055the following definition:-
1066	1066	1056 “Provider organization”, any corporation, partnership, business trust, association or
1067	1067	1057organized group of persons, which is in the business of health care delivery or management,
1068	1068	1058whether incorporated or not, that represents at least 1 health care providers in contracting with
1069	1069	1059carriers, third party administrators or public payers for the payments of health care services;
1070	1070	1060provided, that ''provider organization'' shall include, but not be limited to, physician
1071	1071	1061organizations, physician-hospital organizations, independent practice associations, provider
1072	1072	1062networks, accountable care organizations, management services organizations, providers that are
1073	1073	1063owned or controlled, fully or partially, by for-profit entities, including, but not limited to, private
1074	1074	1064equity firms, and any other organization that contracts with carriers, third party administrators or
1075	1075	1065public payers for payment for health care services; and provided, further that “provider
1076	1076	1066organization” shall not include any integrated care network that is owned and directed by a long-
1077	1077	1067term care providers.
1078	1078	1068 SECTION 47. Said section 1 of said chapter 12C, as so appearing, is hereby further
1079	1079	1069amended by inserting after the definition of “Quality measures” the following definition:- 50 of 121
1080	1080	1070 “Real estate investment trust”, a real estate investment trust as defined in 26 U.S.C. 856.
1081	1081	1071 SECTION 48. Said section 1 of said chapter 12C, as so appearing, is hereby further
1082	1082	1072amended by inserting after the definition of “Total health care expenditures” the following 2
1083	1083	1073definitions:-
1084	1084	1074 “Total medical expenses”, the total cost of care for the patient population associated with
1085	1085	1075a provider organization based on allowed claims for all categories of medical expenses and all
1086	1086	1076non-claims related payments to providers.
1087	1087	1077 “Unsafe financial actor”, a private equity firm or real estate investment trust that had a
1088	1088	1078financial interest in a provider or provider organization that closed, declared bankruptcy or
1089	1089	1079otherwise discontinued its operations within 15 years of the private equity firm or real estate
1090	1090	1080investment trust’s financial interest in the provider or provider organization.
1091	1091	1081 SECTION 49. Section 2A of said chapter 12C, as so appearing, is hereby amended by
1092	1092	1082inserting after the word “cybersecurity”, in line 9, the following words:- and 1 of whom shall
1093	1093	1083have experience in health equity advocacy.
1094	1094	1084 SECTION 50. Section 3 of said chapter 12C, as so appearing, is hereby amended by
1095	1095	1085striking out, in line 11, the word “benchmark” and inserting in place thereof the following
1096	1096	1086words:- and affordability benchmarks.
1097	1097	1087 SECTION 51. Said section 3 of said chapter 12C, as so appearing, is hereby further
1098	1098	1088amended by striking out, in line 12, the words “section 9” and inserting in place thereof the
1099	1099	1089following words:- sections 9 and 9A. 51 of 121
1100	1100	1090 SECTION 52. The first paragraph of section 7 of said chapter 12C, as so appearing, is
1101	1101	1091hereby amended by adding the following sentence:-
1102	1102	1092 Each pharmaceutical manufacturing company and pharmacy benefit manager shall pay to
1103	1103	1093the commonwealth an amount for the estimated expenses of the center and for the other purposes
1104	1104	1094described in this chapter.
1105	1105	1095 SECTION 53. Said section 7 of said chapter 12C, as so appearing, is hereby further
1106	1106	1096amended by striking out, in lines 8 and 42, the figure “33” and inserting in place thereof, in each
1107	1107	1097instance, the following figure:- “25”.
1108	1108	1098 SECTION 54. Said section 7 of said chapter 12C, as so appearing, is hereby further
1109	1109	1099amended by adding following 3 paragraphs:- To the maximum extent under federal law,
1110	1110	1100provided that such assessment shall not result in any reduction of federal financial participation
1111	1111	1101in Medicaid, the assessed amount for pharmaceutical manufacturing companies shall be not less
1112	1112	1102than 25 per cent of the amount appropriated by the general court for the expenses of the center
1113	1113	1103minus amounts collected from: (i) filing fees; (ii) fees and charges generated by the center's
1114	1114	1104publication or dissemination of reports and information; and (iii) federal matching revenues
1115	1115	1105received for these expenses or received retroactively for expenses of predecessor agencies.
1116	1116	1106Pharmaceutical manufacturing companies shall pay such assessed amount multiplied by the ratio
1117	1117	1107of the pharmaceutical manufacturing company’s gross sales of outpatient prescription drugs
1118	1118	1108dispensed in the commonwealth or similar measure determined by the center consistent with
1119	1119	1109applicable federal requirements.
1120	1120	1110 To fund the operations of the licensure of pharmacy benefit managers to the maximum
1121	1121	1111extent allowed by federal law and to the extent that the assessment will not result in any 52 of 121
1122	1122	1112reduction of federal financial participation in Medicaid, the assessed amount for pharmacy
1123	1123	1113benefit managers shall be not less than 25 per cent of the amount appropriated by the general
1124	1124	1114court for the expenses of the center minus amounts collected from: (i) filing fees; (ii) fees and
1125	1125	1115charges generated by the center's publication or dissemination of reports and information; and
1126	1126	1116(iii) federal matching revenues received for these expenses or received retroactively for expenses
1127	1127	1117of predecessor agencies. Pharmacy benefit managers shall pay such assessed amount multiplied
1128	1128	1118by the ratio of the pharmacy benefit manager’s gross revenue related to outpatient prescription
1129	1129	1119drugs dispensed in the commonwealth or similar measure determined by the center consistent
1130	1130	1120with applicable federal requirements. In no event may this assessment, when combined with the
1131	1131	1121assessment of pharmacy benefit managers in section 6 of chapter 6D and the pharmacy benefit
1132	1132	1122manager licensing fee in section 2 of chapter 176Y, exceed the commonwealth’s estimated
1133	1133	1123expense in operating the pharmacy benefit manager licensure program. Each pharmaceutical
1134	1134	1124manufacturing company and each pharmacy benefit manager shall make a preliminary payment
1135	1135	1125to the center on October 1 of each year in an amount equal to 1/2 of the initial year’s and,
1136	1136	1126subsequently, the previous year's total assessment. Thereafter, each pharmaceutical
1137	1137	1127manufacturing company and each pharmacy benefit manager shall pay, within 30 days’ notice
1138	1138	1128from the center, the balance of the total assessment for the current year as determined by the
1139	1139	1129center.
1140	1140	1130 SECTION 55. Section 8 of said chapter 12C, as so appearing, is hereby amended by
1141	1141	1131inserting after the word “entities”, in line 5, the following words:- , including, but not limited to,
1142	1142	1132private equity firms, real estate investment trusts and management services organizations.
1143	1143	1133 SECTION 56. Said section 8 of said chapter 12C, as so appearing, is hereby further
1144	1144	1134amended by inserting after the word “statements”, in line 23, the following words:- , including 53 of 121
1145	1145	1135the audited financial statements of the parent organization’s out-of-state operations, private
1146	1146	1136equity firms, real estate investment trusts and management services organizations,.
1147	1147	1137 SECTION 57. Said section 8 of said chapter 12C, as so appearing, is hereby further
1148	1148	1138amended by striking out, in line 49, the words “and (6)” and inserting in place thereof the
1149	1149	1139following words:- (6) investments; and (7) information on any relationships with private equity
1150	1150	1140firms, real estate investment trusts and management services organizations; and (8).
1151	1151	1141 SECTION 58. Said chapter 12C is hereby further amended by striking out section 9, as so
1152	1152	1142appearing, and inserting in place thereof the following section:-
1153	1153	1143 Section 9. (a) The center, in consultation with the commission, shall promulgate
1154	1154	1144regulations to require that provider organizations registered under section 11 of chapter 6D
1155	1155	1145annually report the data as the center considers necessary to better protect the public interest in
1156	1156	1146monitoring the financial conditions, organizational structure, business practices, clinical services
1157	1157	1147and market share of each registered provider organization. The center may assess administrative
1158	1158	1148fees on provider organizations in an amount to help defray the center's costs in complying with
1159	1159	1149this section. The center may specify in regulations uniform reporting standards and reporting
1160	1160	1150thresholds as it determines necessary.
1161	1161	1151 (b) The center shall require registered provider organizations to report information
1162	1162	1152necessary to achieve the goals described in subsection (a), which may include, but shall not be
1163	1163	1153limited to: (i) organizational charts showing the ownership, governance and operational structure
1164	1164	1154of the provider organization, including any clinical affiliations and community advisory boards;
1165	1165	1155(ii) the number of affiliated health care professional full-time equivalents by license type,
1166	1166	1156specialty, name and address of practice locations and whether the professional is employed by 54 of 121
1167	1167	1157the organization; (iii) the name and address of licensed facilities by license number, license type
1168	1168	1158and capacity in each major service category; (iv) the name, address and capacity of all other
1169	1169	1159locations where the provider organization, or any of its affiliates, delivers health care services,
1170	1170	1160including those services listed in paragraph (4) of subsection (a) of section 22 of chapter 6D; (v)
1171	1171	1161counts and capacity estimates of health care equipment as defined by the center, including
1172	1172	1162imaging equipment; (vi) a comprehensive financial statement, including information on parent
1173	1173	1163entities, including their out-of-state operations, and corporate affiliates, including private equity
1174	1174	1164firms, real estate investment trusts and management services organizations, as applicable, and
1175	1175	1165including details regarding annual costs, annual receipts, realized capital gains and losses,
1176	1176	1166accumulated surplus and accumulated reserves; (vii) information on stop-loss insurance and any
1177	1177	1167non-fee-for-service payment arrangements; (viii) information on clinical quality, care
1178	1178	1168coordination and patient referral practices; (ix) information regarding expenditures and funding
1179	1179	1169sources for payroll, teaching, research, advertising, taxes or payments-in-lieu-of-taxes and other
1180	1180	1170non-clinical functions; (x) information regarding charitable care and community benefit
1181	1181	1171programs; (xi) for any risk-bearing provider organization, a certificate from the division of
1182	1182	1172insurance under chapter 176U; (xii) information regarding other assets and liabilities that may
1183	1183	1173affect the financial condition of the provider organization or the provider organization’s
1184	1184	1174facilities, including, but not limited to, real estate sale-leaseback arrangements with real estate
1185	1185	1175investment trusts; and (xiii) such other information as the center considers appropriate as set
1186	1186	1176forth in the center's regulations; provided, however, that the center shall coordinate with the
1187	1187	1177commission and the division of insurance to obtain information directly from the commission;
1188	1188	1178provided further, that the center shall consider the administrative burden of reporting when
1189	1189	1179developing reporting requirements. The center may, in consultation with the division of 55 of 121
1190	1190	1180insurance and the commission, merge similar reporting requirements where appropriate. The
1191	1191	1181center, in its discretion, may specify additional data elements in a given reporting year to support
1192	1192	1182the development of the state health plan or the focused assessments defined in said section 22 of
1193	1193	1183said chapter 6D.
1194	1194	1184 (c) Annual reporting shall be in a form provided by the center. The center shall
1195	1195	1185promulgate regulations that define criteria for waivers from certain annual reporting
1196	1196	1186requirements under this section. Criteria for waivers may include operational size of the provider
1197	1197	1187organization, the provider organization's annual net patient service revenue, the degree of risk
1198	1198	1188assumed by the provider organization and other criteria as the center considers appropriate.
1199	1199	1189 (d) Notwithstanding the annual reporting requirements under this section, the center may
1200	1200	1190require in writing, at any time, additional information that is reasonable and necessary to
1201	1201	1191determine the financial condition, organizational structure, business practices, clinical services or
1202	1202	1192market share of a registered provider organization.
1203	1203	1193 (e) The center shall develop and maintain an inventory of health care resources on its
1204	1204	1194website in a form usable by the public; provided, that the extracts must include information on
1205	1205	1195the geographic distribution of clinicians, facilities, equipment or any other health care resources.
1206	1206	1196Such inventory shall be derived from all available data, including, but not limited to, data
1207	1207	1197collected under this section and data collected by other state agencies. Agencies that license,
1208	1208	1198register, regulate or otherwise collect cost, quality or other data concerning health care resources
1209	1209	1199shall provide the center and the commission such data and information necessary to develop and
1210	1210	1200maintain the inventory required by this this section. 56 of 121
1211	1211	1201 (f) The center may enter into interagency agreements with the commission and other state
1212	1212	1202agencies to effectuate the goals of this section.
1213	1213	1203 (g)(1) The center shall also collect and analyze such data as it considers necessary to
1214	1214	1204protect the public interest in monitoring financial conditions of registered provider organizations
1215	1215	1205and compliance with subsection (a) of section 23 of chapter 6D by registered provider
1216	1216	1206organizations with private equity investment. To effectuate this subsection, the center may: (i)
1217	1217	1207modify uniform reporting requirements; (ii) require registered provider organizations with
1218	1218	1208private equity investment to report required information quarterly; (iii) require relevant
1219	1219	1209information from private equity firms and their affiliates; and (iv) communicate confidentially
1220	1220	1210with registered provider organizations as the center deems necessary.
1221	1221	1211 (2) The information shall be analyzed on an industry-wide and provider-specific basis
1222	1222	1212and shall include, but not be limited to: (i) gross and net patient service revenues; (ii) sources of
1223	1223	1213revenue; (iii) total payroll as a per cent of operating expenses and the salary and benefits of the
1224	1224	1214top 10 highest compensated employees, identified by position description and specialty; and (iv)
1225	1225	1215other relevant measures of financial health or distress.
1226	1226	1216 (3) The center shall publish annual reports and establish a continuing program of
1227	1227	1217investigation and study of financial trends among registered provider organizations, including an
1228	1228	1218analysis of systemic instabilities or inefficiencies that contribute to financial distress. The reports
1229	1229	1219shall include an identification and examination of: (i) registered provider organizations that the
1230	1230	1220center considers to be in financial distress, including any at risk of closing or discontinuing
1231	1231	1221essential health services, as defined by the department of public health under section 51G of
1232	1232	1222chapter 111, as a result of financial distress; and (ii) registered provider organizations with 57 of 121
1233	1233	1223private equity investment that have violated subsection (a) of section 23 of chapter 6D. The
1234	1234	1224center may provide this information in the report it produces pursuant to subsection (c) of section
1235	1235	12258.
1236	1236	1226 (4) The center shall refer to the commission any provider in which a private equity firm
1237	1237	1227has a financial interest that has violated subsection (a) of section 23 of chapter 6D.
1238	1238	1228 SECTION 59. Section 10 of said chapter 12C, as so appearing, is hereby amended by
1239	1239	1229inserting after the word “of”, in line 21, the following words:- communities and purchaser.
1240	1240	1230 SECTION 60. Subsection (b) of said section 10 of chapter 12C, as so appearing, is
1241	1241	1231hereby further amended by striking out clause (8) and inserting in place thereof the following
1242	1242	1232clause:-
1243	1243	1233 (8) relative prices paid to every hospital or physician group in the payer’s network, by
1244	1244	1234type of provider, with hospital inpatient and outpatient prices listed separately and product type,
1245	1245	1235including health maintenance organization and preferred provider organization products.
1246	1246	1236 SECTION 61. Said subsection (b) of said section 10 of said chapter 12C, as so appearing,
1247	1247	1237is hereby further amended by striking out, in lines 56 to 61, inclusive, the words “and (11) a
1248	1248	1238comparison of relative prices for the payer’s participating health care providers by provider type
1249	1249	1239which shows the average relative price, the extent of variation in price, stated as a percentage,
1250	1250	1240and identifies providers who are paid more than 10 per cent, 15 per cent and 20 per cent above
1251	1251	1241and more than 10 per cent, 15 per cent and 20 per cent below the average relative price” and
1252	1252	1242inserting in place thereof the following words:- (11) information about prescription drug
1253	1253	1243utilization and spending for all covered drugs, including for generic drugs, brand-name drugs and
1254	1254	1244specialty drugs provided in an inpatient or outpatient setting or sold in a retail setting, including, 58 of 121
1255	1255	1245but not limited to, information sufficient to show the: (i) highest utilization drugs; (ii) drugs with
1256	1256	1246the greatest increases in utilization; (iii) drugs that are most impactful on plan spending, net of
1257	1257	1247rebates; (iv) drugs with the highest year-over-year price increases, net of rebates; (v) drugs with
1258	1258	1248the highest out-of-pocket costs including, but not limited to, coinsurances, copayments and
1259	1259	1249deductibles expended by patients; and (vi) drugs with the highest cost per prescription both gross
1260	1260	1250and net of rebates; (12) information on clinical quality, care coordination and patient referral
1261	1261	1251practices; and (13) a comparison of relative prices for the payer’s participating health care
1262	1262	1252providers by provider type, which shows the average relative price and the extent of variation in
1263	1263	1253price and identifies providers who are paid more than 10 per cent, 15 per cent and 20 per cent
1264	1264	1254above and more than 10 per cent, 15 per cent and 20 per cent below the average relative price.
1265	1265	1255 SECTION 62. Subsection (c) of said section 10 of said chapter 12C, as so appearing. is
1266	1266	1256hereby amended by striking out clause (8) and inserting in place thereof the following clause:-
1267	1267	1257 (8) relative prices paid to every hospital or physician group in the payer’s network, by
1268	1268	1258type of provider, with hospital inpatient and outpatient prices listed separately and product type,
1269	1269	1259including health maintenance organization and preferred provider organization products.
1270	1270	1260 SECTION 63. Said subsection (c) of said section 10 of said chapter 12C, as so appearing,
1271	1271	1261is hereby further amended by striking out, in lines 99 to 104, inclusive, the words “and (11) a
1272	1272	1262comparison of relative prices for the payer’s participating health care providers by provider type
1273	1273	1263which shows the average relative price, the extent of variation in price, stated as a percentage and
1274	1274	1264identifies providers who are paid more than 10 per cent, 15 per cent and 20 per cent above and
1275	1275	1265more than 10 per cent, 15 per cent and 20 per cent below the average relative price” and inserting
1276	1276	1266in place thereof the following words:- (11) information about prescription drug utilization and 59 of 121
1277	1277	1267spending for all covered drugs, including for generic drugs, brand-name drugs and specialty
1278	1278	1268drugs provided in an inpatient or outpatient setting or sold in a retail setting, including, but not
1279	1279	1269limited to, information sufficient to show the: (i) highest utilization drugs, (ii) drugs with the
1280	1280	1270greatest increases in utilization, (iii) drugs that are most impactful on plan spending, net of
1281	1281	1271rebates, (v) drugs with the highest year-over-year price increases, net of rebates, and (v) drugs
1282	1282	1272with the highest cost per prescription, both gross and net of rebates; (12) information on clinical
1283	1283	1273quality, care coordination and patient referral practices; and (13) a comparison of relative prices
1284	1284	1274for the payer’s participating health care providers by provider type, which shows the average
1285	1285	1275relative price and the extent of variation in price and identifies providers who are paid more than
1286	1286	127610 per cent, 15 per cent and 20 per cent above and more than 10 per cent, 15 per cent and 20 per
1287	1287	1277cent below the average relative price.
1288	1288	1278 SECTION 64. Said chapter 12C is hereby amended by inserting after section 10 the
1289	1289	1279following section:-
1290	1290	1280 Section 10A. (a) The center shall promulgate regulations necessary to ensure the uniform
1291	1291	1281annual reporting of information from pharmacy benefit managers certified under chapter 176Y,
1292	1292	1282including, but not limited to, data from the most recent calendar year detailing: (i) all discounts,
1293	1293	1283including the total dollar amount and percentage discount and rebates received from a
1294	1294	1284manufacturer for each drug on the pharmacy benefit manager's formularies; (ii) the total dollar
1295	1295	1285amount of all discounts and rebates that are retained by the pharmacy benefit manager for each
1296	1296	1286drug on the pharmacy benefit manager's formularies; (iii) actual total reimbursement amounts for
1297	1297	1287each drug the pharmacy benefit manager pays retail pharmacies after all direct and indirect
1298	1298	1288administrative and other fees that have been retrospectively charged to the pharmacies are
1299	1299	1289applied; (iv) the negotiated price health plans pay the pharmacy benefit manager for each drug 60 of 121
1300	1300	1290on the pharmacy benefit manager's formularies; (v) the amount, terms and conditions relating to
1301	1301	1291copayments, reimbursement options and other payments or fees associated with a prescription
1302	1302	1292drug benefit plan; and (vi) disclosure of any ownership interest the pharmacy benefit manager
1303	1303	1293has in a pharmacy or health plan with which it conducts business or any corporate affiliation
1304	1304	1294between the pharmacy benefit manager and the pharmacy or health plan with which it conducts
1305	1305	1295business; provided, however, that the center may examine or audit the financial records of a
1306	1306	1296pharmacy benefit manager for purposes of ensuring the information submitted pursuant to
1307	1307	1297regulations promulgated under this section is accurate.
1308	1308	1298 (b) The center shall analyze the information and data collected under subsection (a) and
1309	1309	1299shall publish an annual report summarizing, at minimum, the information collected under said
1310	1310	1300subsection (a) and comparing the information as it relates to pharmacy benefit managers certified
1311	1311	1301under chapter 176Y with respect to drugs provided to residents of the commonwealth.
1312	1312	1302 (c) Except as specifically provided otherwise by the center or under this chapter,
1313	1313	1303pharmacy benefit manager data collected by the center under this section shall not be a public
1314	1314	1304record under clause Twenty-sixth of section 7 of chapter 4 or chapter 66. The center may
1315	1315	1305confidentially provide pharmacy benefit manager data collected by the center under this section
1316	1316	1306to the health policy commission.
1317	1317	1307 SECTION 65. Said chapter 12C is hereby further amended by striking out section 11, as
1318	1318	1308appearing in the 2022 Official Edition, and inserting in place thereof the following section:-
1319	1319	1309 Section 11. The center shall ensure the timely reporting of information required under
1320	1320	1310sections 8 to 10, inclusive. The center shall notify entities required to submit data under this
1321	1321	1311chapter of any applicable reporting deadlines. The center shall notify, in writing, an entity, other 61 of 121
1322	1322	1312than a public payer required to submit data under this chapter, which has failed to meet a
1323	1323	1313reporting deadline and that failure to respond within 2 weeks of the receipt of the notice shall
1324	1324	1314result in penalties. The center shall assess a penalty against an entity other than a public health
1325	1325	1315care payer required to submit data under this chapter that fails, without just cause, to provide the
1326	1326	1316requested information within 2 weeks following receipt of the written notice required under this
1327	1327	1317paragraph, of not more than $25,000 per week for each week of delay after the 2-week period
1328	1328	1318following the reporting entity’s receipt of the written notice. Amounts collected under this
1329	1329	1319section shall be deposited in the Healthcare Payment Reform Fund, established under section 100
1330	1330	1320of 194 of the acts of 2011. The center shall notify the commission and the department of public
1331	1331	1321health if a provider or provider organization fails to timely report in accordance with this section,
1332	1332	1322or if the center has assessed a penalty under this section. Such notification shall be considered by
1333	1333	1323the commission in a cost and market impact review under section 13 of chapter 6D, and by the
1334	1334	1324department in determining licensure and suitability in accordance with section 51 of chapter 111
1335	1335	1325and for a determination of need under section 25C of said chapter 111. The center may
1336	1336	1326promulgate regulations to define “just cause” for the purpose of this section.
1337	1337	1327 SECTION 66. Section 12 of said chapter 12C, as so appearing, is hereby amended by
1338	1338	1328adding the following subsection:-
1339	1339	1329 (c) Notwithstanding any general or special law to the contrary, a provider, private health
1340	1340	1330care payer, public health care payer, agency, department, division, commission, board, authority
1341	1341	1331or other public or quasi-public entity in the commonwealth that collects patient information,
1342	1342	1332including personal data as defined in section 1 of chapter 66A, shall, upon a request from the
1343	1343	1333center, provide such data to the center for any purpose consistent with this chapter; provided,
1344	1344	1334however, that the disclosure of such information shall be in compliance with federal law. 62 of 121
1345	1345	1335 SECTION 67. Said chapter 12C is hereby further amended by striking out section 14, as
1346	1346	1336so appearing, and inserting in place thereof the following section:-
1347	1347	1337 Section 14. (a)(1) Not later than March 1 in each even-numbered year, the center, in
1348	1348	1338consultation with the statewide advisory committee established pursuant to subsection (c), shall
1349	1349	1339establish a standard set of measures of health care provider quality and health system
1350	1350	1340performance, hereinafter referred to as the “standard quality measure set”, for use in: (i) contracts
1351	1351	1341between payers, including between the commonwealth and carriers and between health care
1352	1352	1342providers, provider organizations and accountable care organizations, which incorporate quality
1353	1353	1343measures into payment terms, including the designation of a set of core measures and a set of
1354	1354	1344non-core measures; (ii) assigning tiers to health care providers in the design of any health plan;
1355	1355	1345(iii) consumer transparency websites and other methods of providing consumer information; (iv)
1356	1356	1346monitoring system-wide performance; and (v) reducing provider administrative burden related to
1357	1357	1347quality measure reporting.
1358	1358	1348 (2) The standard quality measure set shall designate: (i) core measures that shall be used
1359	1359	1349in contracts that incorporate quality measures into payment terms between payers, including the
1360	1360	1350commonwealth and carriers, and health care providers, including provider organizations and
1361	1361	1351accountable care organizations, and shall meet the core criteria set by the statewide advisory
1362	1362	1352committee pursuant to paragraph (3) of subsection (c); and (ii) a menu of non-core measures that
1363	1363	1353may be used in such contracts. The standard quality measure set shall allow for innovation and
1364	1364	1354the development of outcome measures for quality and safety. If the standard quality measure set
1365	1365	1355established by the center differs from the recommendations of the statewide advisory committee,
1366	1366	1356the center shall issue a written report detailing each area of disagreement and the rationale for the
1367	1367	1357center’s decision. 63 of 121
1368	1368	1358 (b) The center shall develop uniform reporting requirements for the standard quality
1369	1369	1359measure set for each health care provider facility, medical group or provider group in the
1370	1370	1360commonwealth; provided, however, that the center shall prioritize the development of uniform
1371	1371	1361reporting requirements for primary care and behavioral health providers; and provided further,
1372	1372	1362that the uniform reporting requirements shall not increase provider administrative burden related
1373	1373	1363to quality measure reporting.
1374	1374	1364 (c)(1) The center shall convene a statewide advisory committee which shall make
1375	1375	1365recommendations for the standard quality measure set to: (i) ensure consistency in the use of
1376	1376	1366quality and safety measures in contracts between payers, including the commonwealth and
1377	1377	1367carriers, and health care providers in the commonwealth; (ii) ensure consistency in methods for
1378	1378	1368the assignment of tiers to providers in the design of any health plan; (iii) improve quality and
1379	1379	1369safety of care; (iv) improve transparency for consumers and employers; (v) improve health
1380	1380	1370system monitoring and oversight by relevant state agencies; and (vi) reduce administrative
1381	1381	1371burdens.
1382	1382	1372 (2) The statewide advisory committee shall consist of commissioner of insurance or a
1383	1383	1373designee, who shall serve as co-chair; the executive director of the health policy commission, or
1384	1384	1374their designee, who shall serve as co-chair; the executive director of the center; the executive
1385	1385	1375director of the Betsy Lehman center for patient safety and medical error reduction; the executive
1386	1386	1376director of the group insurance commission; the secretary of elder affairs; the assistant secretary
1387	1387	1377for MassHealth; the commissioner of the department of public health; the commissioner of the
1388	1388	1378department of mental health; and 11 members who shall be appointed by the governor, 1 of
1389	1389	1379whom shall be a representative of Massachusetts Health and Hospital Association, Inc., 1 of
1390	1390	1380whom shall be a representative of the Massachusetts League of Community Health Centers, Inc., 64 of 121
1391	1391	13811 of whom shall be a representative the Massachusetts Medical Society, 1 of whom shall be a
1392	1392	1382registered nurse licensed to practice in the commonwealth who practices in a patient care setting,
1393	1393	13831 of whom shall be a representative of a labor organization representing health care workers, 1 of
1394	1394	1384whom shall be a behavioral health provider, 1 of whom shall be a long-term supports and
1395	1395	1385services provider, 1 of whom shall be a representative of Blue Cross and Blue Shield of
1396	1396	1386Massachusetts, Inc., 1 of whom shall be a representative of Massachusetts Association of Health
1397	1397	1387Plans, Inc., 1 of whom shall be a representative of a specialty pediatric provider and 1 of whom
1398	1398	1388shall be a representative of consumers. Members appointed to the statewide advisory committee
1399	1399	1389shall have experience with and expertise in health care quality measurement.
1400	1400	1390 (3) The statewide advisory committee shall meet quarterly to develop recommendations
1401	1401	1391for the core measure and non-core measures to be adopted in the standard quality measure set for
1402	1402	1392use in: (i) contracts between payers, including the commonwealth and carriers, and health care
1403	1403	1393providers, provider organizations and accountable care organizations, including the designation
1404	1404	1394of a set of core measures and a set of non-core measures; (ii) assigning tiers to health care
1405	1405	1395providers in the design of any health plan; (iii) consumer transparency websites and other
1406	1406	1396methods of providing consumer information; (iv) monitoring system-wide performance; and (v)
1407	1407	1397reducing provider administrative burdens related to quality measure reporting.
1408	1408	1398 (4) In developing its recommendations for the standard quality measure set, the statewide
1409	1409	1399advisory committee shall incorporate recognized quality and safety measures including, but not
1410	1410	1400limited to, measures used by the Centers for Medicare and Medicaid Services, the group
1411	1411	1401insurance commission, carriers and providers and provider organizations in the commonwealth
1412	1412	1402and other states, as well as other valid measures of health care provider performance and
1413	1413	1403outcomes, including patient-reported outcomes and functional status, patient experience, health 65 of 121
1414	1414	1404disparities and population health. The statewide advisory committee shall consider measures
1415	1415	1405applicable to primary care providers, specialists, hospitals, provider organizations, accountable
1416	1416	1406care organizations, oral health providers and other types of providers and measures applicable to
1417	1417	1407different patient populations.
1418	1418	1408 (5) Not later than January 1 in each even-numbered year, the statewide advisory
1419	1419	1409committee shall submit to the center its recommendations on the core measures and non-core
1420	1420	1410measures to be adopted, changed or updated by the center in the standard quality measure set,
1421	1421	1411along with a report in support of its recommendations.
1422	1422	1412 SECTION 68. Section 15 of said chapter 12C, as so appearing, is hereby amended by
1423	1423	1413striking out, in line 4, the word “injury” and inserting in place thereof the following word:- harm.
1424	1424	1414 SECTION 69. Said section 15 of said chapter 12C, as so appearing, is hereby further
1425	1425	1415amended by striking out the definition of “Board” and inserting in place thereof the following 3
1426	1426	1416definitions:-
1427	1427	1417 “Agency”, an agency of the executive branch of the commonwealth including, but not
1428	1428	1418limited to, a constitutional or other office, executive office, department, division, bureau, board,
1429	1429	1419commission or committee thereof, or any authority created by the general court to serve a public
1430	1430	1420purpose, having either statewide or local jurisdiction.
1431	1431	1421 “Board”, the patient safety and medical errors reduction board.
1432	1432	1422 “Healthcare-associated infection”, an infection that a patient acquires during the course of
1433	1433	1423receiving treatment for other conditions within a health care setting. 66 of 121
1434	1434	1424 SECTION 70. Said section 15 of said chapter 12C, as so appearing, is hereby further
1435	1435	1425amended by inserting after the definition of “Patient safety” the following definition:-
1436	1436	1426 “Patient safety information”, data and information related to patient safety, including
1437	1437	1427adverse events, incidents, medical errors or health care-associated infections, that is collected or
1438	1438	1428maintained by agencies.
1439	1439	1429 SECTION 71. Said section 15 of said chapter 12C, as so appearing, is hereby further
1440	1440	1430amended by striking out subsection (f) and inserting in place thereof the following 3
1441	1441	1431subsections:-
1442	1442	1432 (f) Notwithstanding any general or special law to the contrary, the Lehman center and
1443	1443	1433any agency, provider organization, department, division, commission, board, authority or other
1444	1444	1434public or quasi-public entity in the commonwealth that collects or maintains patient safety
1445	1445	1435information may transmit such information, including personal data as defined in section 1 of
1446	1446	1436chapter 66A, to each other, and shall transmit such information to the Lehman center upon
1447	1447	1437request from the Lehman center; provided, however, that transmission of such information shall
1448	1448	1438be governed by an agreement, which may be an interagency service agreement, between the
1449	1449	1439party transmitting the information and the Lehman center; provided further, that such agreement
1450	1450	1440shall provide for any safeguards necessary to protect the privacy and security of the information;
1451	1451	1441and provided further, that the transmission of such information shall be in compliance with
1452	1452	1442federal law.
1453	1453	1443 (g) The Lehman center may adopt rules and regulations necessary to carry out the
1454	1454	1444purpose of this section. The Lehman center may contract with any federal, state or municipal 67 of 121
1455	1455	1445entity or other public institution or with any private individual, partnership, firm, corporation,
1456	1456	1446association or other entity to manage its affairs or carry out the purpose of this section.
1457	1457	1447 (h) The Lehman center shall report annually to the joint committee on health care
1458	1458	1448financing regarding the progress made in improving patient safety and medical error reduction.
1459	1459	1449The Lehman center may seek federal and foundation support to supplement state resources to
1460	1460	1450carry out the Lehman center’s patient safety and medical error reduction goals.
1461	1461	1451 SECTION 72. Section 16 of said chapter 12C, as so appearing, is hereby amended by
1462	1462	1452inserting after the word “publish”, in line 1, the following words:- , for the most recently
1463	1463	1453concluded benchmark cycle, .
1464	1464	1454 SECTION 73. Said section 16 of said chapter 12C, as so appearing, is hereby further
1465	1465	1455amended by inserting after the word “submitted”, in line 2, the following words:- for that
1466	1466	1456benchmark cycle .
1467	1467	1457 SECTION 74. Said section 16 of said chapter 12C, as so appearing, is hereby further
1468	1468	1458amended by striking out, in line 7, the word “benchmark” and inserting in place thereof the
1469	1469	1459following words:- and affordability benchmarks.
1470	1470	1460 SECTION 75. Said section 16 of said chapter 12C, as so appearing, is hereby further
1471	1471	1461amended by striking out, in line 8, the words “section 9” and inserting in place thereof the
1472	1472	1462following words:- sections 9 and 9A.
1473	1473	1463 SECTION 76. Said section 16 of said chapter 12C, as so appearing, is hereby further
1474	1474	1464amended by striking out, in line 43, the words “and (12)” and inserting in place thereof the
1475	1475	1465following words:- (12) a standard set of measures of health care affordability in the 68 of 121
1476	1476	1466commonwealth, including family health care expenditures and an annual index of how such
1477	1477	1467health care costs compare to the health care affordability benchmark set under section 9A of
1478	1478	1468chapter 6D; and (13).
1479	1479	1469 SECTION 77. Said section 16 of said chapter 12C, as so appearing, is hereby further
1480	1480	1470amended by adding the following subsection:-
1481	1481	1471 (d) The center shall evaluate and report on individual private and public health care payer
1482	1482	1472data metrics submitted to the center pursuant to clauses (1) to (5), inclusive, of subsection (b) of
1483	1483	1473section 10 and data submitted to the division of insurance pursuant to section 21 of chapter
1484	1484	1474176O. The center shall include information on payer data in its annual report required under this
1485	1485	1475section; provided, however, that such information shall be reported on an industry-wide, payer-
1486	1486	1476specific basis and shall include, but not be limited to: (i) operating margins; (ii) total margins;
1487	1487	1477(iii) reserves in dollars and as a percentage of risk-based capital; (iv) enrollment and member
1488	1488	1478months; (v) total premiums and premiums on a per member per month basis; (vi) total medical
1489	1489	1479expenses and medical expenses on a per member per month basis; and (vii) total administrative
1490	1490	1480expenses and administrative expenses on a per member per month basis; and provided further,
1491	1491	1481that the center shall report this information by type of business, where possible.
1492	1492	1482 SECTION 78. Said chapter 12C of the General Laws is hereby amended by striking out
1493	1493	1483sections 17 and 18, as so appearing, and inserting in place thereof the following 2 sections:-
1494	1494	1484 Section 17. The attorney general may review and analyze any information submitted to
1495	1495	1485the center by a provider, provider organization, private equity firm, real estate investment trust,
1496	1496	1486management services organization, pharmaceutical manufacturing company, pharmacy benefit
1497	1497	1487manager or payer pursuant to sections 8, 9 and 10 of this chapter, and to the commission under 69 of 121
1498	1498	1488section 8 of chapter 6D. The attorney general may require that such entities produce documents,
1499	1499	1489answer interrogatories and provide testimony under oath related to health care costs and cost
1500	1500	1490trends, factors that contribute to cost growth within the commonwealth’s health care system and
1501	1501	1491the relationship between provider costs and payer premium rates. The attorney general shall keep
1502	1502	1492confidential all nonpublic information and documents obtained under this section and shall not
1503	1503	1493disclose the information or documents to any person without the consent of the entity that
1504	1504	1494produced the information or documents; provided, however, that the attorney general may
1505	1505	1495disclose such information or documents during (i) the annual hearing conducted under section 8
1506	1506	1496of chapter 6D, (ii) a rate hearing before the health insurance bureau, or (iii) in a case brought by
1507	1507	1497the attorney general, if the attorney general believes that such disclosure will promote the health
1508	1508	1498care cost containment goals of the commonwealth and that the disclosure would be in the public
1509	1509	1499interest after taking into account any privacy, trade secret or anti-competitive considerations. The
1510	1510	1500confidential information and documents shall not be public records and shall be exempt from
1511	1511	1501disclosure under clause Twenty-sixth of section 7 of chapter 4 or section 10 of chapter 66.
1512	1512	1502 Section 18. (a) The center shall perform ongoing analysis of data it receives under this
1513	1513	1503chapter to identify any health care entity whose: (1) contribution to health care spending levels
1514	1514	1504and growth, including but not limited to, spending levels and growth as measured by health-
1515	1515	1505status adjusted total medical expense or total medical expense, is considered excessive and who
1516	1516	1506threaten the ability of the state to meet the health care cost growth benchmark established by the
1517	1517	1507commission under section 9 of chapter 6D; provided further, that the center shall identify cohorts
1518	1518	1508for similar health care entities and establish differential standards for excessive growth rates
1519	1519	1509within the health care cost growth benchmark established by the commission under section 9 of
1520	1520	1510chapter 6D, based on factors which may include, but are not limited to, a health care entity’s 70 of 121
1521	1521	1511spending, pricing levels and payer mix; or (2) data is not submitted to the center in a proper,
1522	1522	1512timely or complete manner.
1523	1523	1513 (b) The center shall confidentially provide a list of the health care entities to the
1524	1524	1514commission such that the commission may pursue further action under section 10 of chapter 6D.
1525	1525	1515Confidential referrals under this section shall not preclude the center from using its authority to
1526	1526	1516assess penalties for noncompliance under section 11.
1527	1527	1517 SECTION 79. Section 10 of chapter 13 of the General Laws, as so appearing, is hereby
1528	1528	1518amended by striking out the last paragraph and inserting in place thereof the following
1529	1529	1519paragraph:-
1530	1530	1520 The board may: (i) adopt, amend and rescind such rules and regulations as it deems
1531	1531	1521necessary to carry out this chapter subject to the approval of the commissioner of public health;
1532	1532	1522(ii) make contracts and arrangements for the performance of administrative and similar services
1533	1533	1523required or appropriate in the performance of the duties of the board; and (iii) adopt and make
1534	1534	1524public rules of procedure and other regulations not inconsistent with other provisions of the
1535	1535	1525General Laws. The commissioner of public health shall appoint an executive director and a legal
1536	1536	1526counsel for the board.
1537	1537	1527 SECTION 80. Said chapter 13 is hereby further amended by striking out section 10A, as
1538	1538	1528so appearing, and inserting in place thereof the following section:-
1539	1539	1529 Section 10A. The commissioner of public health shall review and approve any rule or
1540	1540	1530regulation proposed by the board of registration in medicine pursuant to section 10. Such rule or
1541	1541	1531regulation shall be deemed disapproved unless approved within 60 days of submission to the
1542	1542	1532commissioner pursuant to said section 10. 71 of 121
1543	1543	1533 SECTION 81. Chapter 26 of the General Laws is hereby amended by striking out section
1544	1544	15347A, as so appearing, and inserting in place thereof the following section:-
1545	1545	1535 Section 7A. (a) As used in this section, the following words shall, unless the context
1546	1546	1536clearly requires otherwise, have the following meanings:-
1547	1547	1537 “Bureau”, health insurance bureau.
1548	1548	1538 “Deputy commissioner”, the deputy commissioner of the health insurance bureau.
1549	1549	1539 “Health benefit plan”, any individual, general, blanket or group policy of health, accident
1550	1550	1540and sickness insurance issued by an insurer licensed under chapter 175; an individual or group
1551	1551	1541hospital service plan issued by a non-profit hospital service corporation under chapter 176A; an
1552	1552	1542individual or group medical service plan issued by a nonprofit medical service corporation under
1553	1553	1543chapter 176B; an individual or group health maintenance contract issued by a health maintenance
1554	1554	1544organization under chapter 176G, and a dental service plan offered by a dental service
1555	1555	1545corporation under chapter 176E. Health benefit plans shall not include: (i) accident only, credit
1556	1556	1546only, limited scope vision if offered separately; (ii) hospital indemnity insurance policies that
1557	1557	1547provide a benefit to be paid to an insured or a dependent, including the spouse of an insured, on
1558	1558	1548the basis of a hospitalization of the insured or a dependent, that are sold as a supplement and not
1559	1559	1549as a substitute for a health benefit plan and that meet any requirements set by the commissioner
1560	1560	1550by regulation; (iii) disability income insurance; (iv) coverage issued as a supplement to liability
1561	1561	1551insurance; (v) specified disease insurance that is purchased as a supplement and not as a
1562	1562	1552substitute for a health plan and meets any requirements the commissioner by regulation may set;
1563	1563	1553(vi) insurance arising out of a workers' compensation law or similar law; (vii) automobile
1564	1564	1554medical payment insurance; (viii) insurance under which benefits are payable with or without 72 of 121
1565	1565	1555regard to fault and which is statutorily required to be contained in a liability insurance policy or
1566	1566	1556equivalent self-insurance; (ix) long-term care if offered separately; (x) coverage supplemental to
1567	1567	1557the coverage provided under 10 U.S.C. 55 if offered as a separate insurance policy; (xi) travel
1568	1568	1558insurance; or (xii) any policy subject to chapter 176K or any similar policies issued on a group
1569	1569	1559basis, Medicare Advantage plans or Medicare Prescription drug plans. A health plan issued,
1570	1570	1560renewed or delivered within or without the commonwealth to an individual who is enrolled in a
1571	1571	1561qualifying student health insurance program under section 18 of chapter 15A shall not be
1572	1572	1562considered a health plan for the purposes of this chapter and shall be governed by said chapter
1573	1573	156315A; provided, however, that travel insurance for the purpose of this chapter is insurance
1574	1574	1564coverage for personal risks incident to planned travel, including, but not limited to: (A)
1575	1575	1565interruption or cancellation of trip or event; (B) loss of baggage or personal effects; (C) damages
1576	1576	1566to accommodations or rental vehicles; or (D) sickness, accident, disability or death occurring
1577	1577	1567during travel, provided, however, that the health benefits are not offered on a stand-alone basis
1578	1578	1568and are incidental to other coverages; and provided further, that the term “travel insurance” shall
1579	1579	1569not include major medical plans, which provide comprehensive medical protection for travelers
1580	1580	1570with trips lasting 6 months or longer, including for example, those working overseas as ex-patriot
1581	1581	1571or military personnel being deployed.
1582	1582	1572 “Rate review”, any examination performed by the deputy commissioner of the aggregate
1583	1583	1573rates of payment pursuant to sections 5, 6 and 10 of chapter 176A; section 4 of chapter 176B;
1584	1584	1574section 16 of chapter 176G; section 6 of chapter 176J; and section 7 of chapter 176K.
1585	1585	1575 (b) There shall be within the division of insurance a health insurance bureau overseen by
1586	1586	1576a deputy commissioner, whose duties shall include, but not be limited to, rate review of premium
1587	1587	1577rates for health benefit plans offered, issued or renewed in the commonwealth, administration of 73 of 121
1588	1588	1578the division's statutory and regulatory authority for oversight of the small group and individual
1589	1589	1579health insurance market, oversight of affordable health plans, including coverage for young
1590	1590	1580adults, as well as the dissemination of appropriate information to consumers about health
1591	1591	1581insurance coverage and access to affordable products. The deputy commissioner shall: (i) protect
1592	1592	1582the interests of consumers of health insurance; (ii) encourage fair treatment of health care
1593	1593	1583providers by health insurers; (iii) enhance equity, access, quality and affordability in the health
1594	1594	1584care system; (iv) guard the solvency of health insurers; (v) work cooperatively with the health
1595	1595	1585policy commission and the center for health information and analysis to monitor health care
1596	1596	1586spending; and (vi) consider affordability of health insurance products during rate review.
1597	1597	1587 (c) The deputy commissioner shall develop affordability standards to consider during rate
1598	1598	1588review; provided, however, that the deputy commissioner’s review of a carrier’s rates shall
1599	1599	1589adhere to principles of solvency and actuarial soundness. Such standards shall consider factors
1600	1600	1590including, but not limited to: (i) affordability for consumers, including the totality of costs paid
1601	1601	1591by consumers of health insurance for covered benefits including, but not limited to, the enrollee’s
1602	1602	1592share of premium, out-of-pocket maximum amounts, deductibles, copays, coinsurance and other
1603	1603	1593forms of cost sharing for health insurance coverage; (ii) affordability for purchasers, including
1604	1604	1594the totality of costs paid by purchasers of health insurance including, but not limited to, premium
1605	1605	1595costs, actuarial value of coverage for covered benefits and the value delivered on health care
1606	1606	1596spending in terms of improved quality and cost efficiency; and (iii) the impact of proposed rates
1607	1607	1597on the commonwealth’s performance against the health care cost growth benchmark established
1608	1608	1598in section 9 of chapter 6D and the affordability benchmark established in section 9A of said
1609	1609	1599chapter 6D. 74 of 121
1610	1610	1600 (d) The deputy commissioner shall review data and documents submitted to the division,
1611	1611	1601including, but not limited to, any materials submitted as part of rate reviews, to examine the
1612	1612	1602causes of premium rate increases and excessive provider price variation.
1613	1613	1603 (e) The commissioner shall appoint, at a minimum, the following employees to the
1614	1614	1604bureau: a deputy commissioner, a general counsel, a chief health economist, a chief actuary, a
1615	1615	1605chief research analyst and a chief examiner. The appointed employees shall devote their full time
1616	1616	1606to the duties of their offices, shall be exempt from chapters 30 and 31 and shall serve at the
1617	1617	1607pleasure of the commissioner. The commissioner may appoint and remove additional employees,
1618	1618	1608including, but not limited to, a first deputy, economists, analysts, examiners, assistant actuaries,
1619	1619	1609inspectors, clerks and other assistants as the work of the division may require. Such additional
1620	1620	1610employees shall perform such duties as the commissioner may prescribe.
1621	1621	1611 (f) The commissioner shall make and collect an assessment against the carriers licensed
1622	1622	1612under chapters 175, 176A, 176B, 176E, 176F and 176G to pay for the expenses of the bureau.
1623	1623	1613The assessment shall be at a rate sufficient to produce $1,000,000 annually. In addition to that
1624	1624	1614amount, the assessment shall include an amount to be credited to the General Fund which shall
1625	1625	1615be equal to the total amount of funds estimated by the secretary of administration and finance to
1626	1626	1616be expended from the General Fund for indirect and fringe benefit costs attributable to the
1627	1627	1617personnel costs of the bureau. The assessment shall be allocated on a fair and reasonable basis
1628	1628	1618among all carriers licensed under said chapters. The funds produced by the assessments shall be
1629	1629	1619expended by the bureau, in addition to any other funds which may be appropriated, to assist in
1630	1630	1620defraying the general operating expenses of the division and may be used to compensate
1631	1631	1621consultants retained by the bureau. A carrier licensed under said chapters shall pay the amount 75 of 121
1632	1632	1622assessed against it within 30 days after the date of the notice of assessment from the
1633	1633	1623commissioner.
1634	1634	1624 (g) Notwithstanding any general or special law to the contrary, carriers offering health
1635	1635	1625benefit plans, including carriers licensed under chapter 175, 176A, 176B or 176G, shall annually
1636	1636	1626file a summary of negotiated rate increases for their largest providers, by provider group to the
1637	1637	1627bureau. The deputy commissioner shall confidentially provide such information to the health
1638	1638	1628policy commission.
1639	1639	1629 Rates of reimbursement or rate increases submitted for review by the bureau under this
1640	1640	1630section shall be deemed confidential and exempt from the definition of public records in clause
1641	1641	1631Twenty-sixth of section 7 of chapter 4 or section 10 of chapter 66. The deputy commissioner
1642	1642	1632shall adopt regulations to carry out this section.
1643	1643	1633 SECTION 82. Subsection (b) of section 7H½ of chapter 29 of the General Laws, as so
1644	1644	1634appearing, is hereby amended by striking out the first sentence and inserting in place thereof the
1645	1645	1635following sentence:- Annually, not later than January 15, the secretary of administration and
1646	1646	1636finance shall meet with the house and senate committees on ways and means and shall jointly
1647	1647	1637develop a growth rate of potential gross state product for the calendar year that will begin 2 years
1648	1648	1638following the calendar year in which the January 15 date occurs, which shall be agreed to by the
1649	1649	1639secretary and the committees.
1650	1650	1640 SECTION 83. Section 9-609 of chapter 106 of the General Laws, as so appearing, is
1651	1651	1641hereby amended by adding the following subsection:-
1652	1652	1642 (d) Notwithstanding subsection (a), in the case of a debtor that is a hospital licensed by
1653	1653	1643the department of public health under section 51 of chapter 111 and collateral that is a medical 76 of 121
1654	1654	1644device, a secured party shall send notice to the debtor and the department of public health not
1655	1655	1645less than 90 days prior to taking possession of the collateral, rendering equipment unusable or
1656	1656	1646disposing of the collateral on the debtor’s premises pursuant to subsection (a). For the purposes
1657	1657	1647of this subsection, “medical device” shall have the same meaning as that term is defined in
1658	1658	1648section 1 of chapter 111N.
1659	1659	1649 SECTION 84. Section 1 of chapter 111 of the General Laws, as so appearing, is hereby
1660	1660	1650amended by inserting after the definition “Nuclear reactor” the following definition:-
1661	1661	1651 “Party of record”, during the pendency of an application for a determination of need, an
1662	1662	1652applicant for a determination of need, the attorney general, the center for health information and
1663	1663	1653analysis, the health policy commission, any government agency with relevant oversight or
1664	1664	1654licensure authority over the proposed project or components therein or any 10 taxpayers of the
1665	1665	1655commonwealth organized as a group.
1666	1666	1656 SECTION 85. Section 25A of said chapter 111, as so appearing, is hereby amended by
1667	1667	1657striking out the first 5 paragraphs.
1668	1668	1658 SECTION 86. Section 25C of said chapter 111, as so appearing, is hereby amended by
1669	1669	1659striking out subsections (g) to (j), inclusive, and inserting in place thereof the following 4
1670	1670	1660subsections:-
1671	1671	1661 (g) The department, in making any determination of need, shall: (i) assess both the
1672	1672	1662applicant and the proposed project; (ii) be guided by the state health plan and focused health
1673	1673	1663assessments pursuant to section 22 of chapter 6D and the health care resources inventory
1674	1674	1664pursuant to section 9 of chapter 12C; (iii) encourage appropriate allocation of private and public
1675	1675	1665health care resources and the development of alternative or substitute methods of delivering 77 of 121
1676	1676	1666health care services so that adequate health care services will be made reasonably available to
1677	1677	1667every person within the commonwealth at the lowest reasonable aggregate cost; (iv) be guided
1678	1678	1668by the commonwealth’s cost containment and affordability goals; (v) assess the impacts on the
1679	1679	1669applicant’s patients and on other residents of the commonwealth, including, but not limited to,
1680	1680	1670considerations of health equity and the workforce of surrounding health care providers; and (vi)
1681	1681	1671take into account any comments and relevant data from the center for health information and
1682	1682	1672analysis, the health policy commission, including, but not limited to, any cost and market impact
1683	1683	1673review report pursuant to subsection (f) of section 13 of chapter 6D, and any other state agency
1684	1684	1674or entity. The department may impose reasonable terms and conditions on the approval of a
1685	1685	1675determination of need as the department determines are necessary to achieve the purposes and
1686	1686	1676intent of this section, including, but not limited to, conditions intended to address health care
1687	1687	1677disparities and better align a project with community needs. The department may recognize the
1688	1688	1678special needs and circumstances of projects that: (i) are essential to the conduct of research in
1689	1689	1679basic biomedical or health care delivery areas or to the training of health care personnel; (ii) are
1690	1690	1680unlikely to result in any increase in the clinical bed capacity or outpatient load capacity of the
1691	1691	1681facility; and (iii) are unlikely to cause an increase in the total patient care charges of the facility
1692	1692	1682to the public for health care services, supplies and accommodations, as such charges shall be
1693	1693	1683defined from time to time in accordance with section 5 of chapter 409 of the acts of 1976. The
1694	1694	1684department may also recognize the special needs and circumstances of projects that may address
1695	1695	1685a lack of supply for a specific region, population or service line that has been identified in the
1696	1696	1686state health plan or focused assessments pursuant to section 22 of chapter 6D.
1697	1697	1687 (h) Applications for such determination shall be filed with the department, together with
1698	1698	1688other forms and information as shall be prescribed by, or acceptable to, the department. No 78 of 121
1699	1699	1689provider or provider organization may apply for a notice of determination of need until a
1700	1700	1690material change notice, if required, has been submitted to the health policy commission under
1701	1701	1691section 13 of chapter 6D. A duplicate copy of any application together with supporting
1702	1702	1692documentation for such application, shall be a public record and kept on file in the department.
1703	1703	1693The department may require a public hearing on any application at its discretion or at the request
1704	1704	1694of the attorney general. The attorney general may intervene in any hearing under this section. A
1705	1705	1695reasonable fee, established by the department, shall be paid upon the filing of such application;
1706	1706	1696provided, however, that such fee shall not exceed 0.2 per cent of the capital expenditures, if any,
1707	1707	1697proposed by the applicant. The department may adapt the information required and fees required
1708	1708	1698for applications if it determines a project or class of projects may address a lack of supply for a
1709	1709	1699specific region, population or service line that has been identified in the state health plan or
1710	1710	1700focused assessments pursuant to section 22 of chapter 6D. The department may also require an
1711	1711	1701independent cost analysis be conducted, at the expense of the applicant, by an entity selected and
1712	1712	1702overseen by the department, including, but not limited to, another state agency, to demonstrate
1713	1713	1703that the application is consistent with the commonwealth's efforts to meet the health care cost
1714	1714	1704containment goals established by the commission. Such entity may request, and the applicant
1715	1715	1705may not unreasonably withhold, confidential data and documents necessary to conduct an
1716	1716	1706independent cost analysis pursuant to such section; provided, however, that any confidential data
1717	1717	1707and documents so requested shall be provided to the entity conducting the independent cost
1718	1718	1708analysis, the department, the health policy commission and the attorney general, but shall not be
1719	1719	1709disclosed to any other person without the consent of the applicant, except in summary form, or
1720	1720	1710when the department, health policy commission or attorney general determines that such
1721	1721	1711disclosure should be made in the public interest after taking into account any privacy, trade 79 of 121
1722	1722	1712secret or anticompetitive considerations; and provided further, that any confidential data and
1723	1723	1713documents so provided shall not be public records and shall be exempt from disclosure under
1724	1724	1714clause Twenty-sixth of section 7 of chapter 4 or section 10 of chapter 66.
1725	1725	1715 (i) Except in the case of an emergency situation determined by the department as
1726	1726	1716requiring immediate action to prevent further damage to the public health or to a health care
1727	1727	1717facility, the department shall not act upon an application for such determination unless: (i) the
1728	1728	1718application has been on file with the department for not less than 30 days; (ii) the center for
1729	1729	1719health information and analysis, the health policy commission, the office of the attorney general,
1730	1730	1720the state and appropriate regional comprehensive health planning agencies and, in the case of
1731	1731	1721long-term care facilities only, the department of elder affairs, or in the case of any facility
1732	1732	1722providing inpatient services for individuals with intellectual or developmentally disabilities, the
1733	1733	1723departments of mental health or developmental services, respectively, have been provided copies
1734	1734	1724of such application and supporting documents and given reasonable opportunity to supply
1735	1735	1725required information and comment on such application; and (iii) a public hearing has been held
1736	1736	1726on such application when requested by the applicant, the state or appropriate regional
1737	1737	1727comprehensive health planning agency, any 10 taxpayers of the commonwealth or any other
1738	1738	1728party of record. If, in any filing period, an individual application is filed that would implicitly
1739	1739	1729decide any other application filed during such period, the department shall not act only upon an
1740	1740	1730individual application.
1741	1741	1731 (j) The department shall so approve or disapprove, in whole or in part, each such
1742	1742	1732application for a determination of need not more than 6 months after filing with the department;
1743	1743	1733provided, however, that the department may, on not more than 1 occasion, delay the action for up
1744	1744	1734to 2 months after the applicant has provided information which the department has reasonably 80 of 121
1745	1745	1735requested during the 8-month period; provided further, that: (i) the period for review of an
1746	1746	1736application for which an independent cost analysis is conducted pursuant to subsection (h) shall
1747	1747	1737be stayed until a completed independent cost analysis is received and accepted by the
1748	1748	1738department: (ii) the period of review of an application for which the commission conducts a cost
1749	1749	1739and market impact review shall be stayed until a final cost and market impact review has been
1750	1750	1740issued: and (iii) the period of review of an application for which the applicant is subject to a
1751	1751	1741performance improvement plan pursuant to section 10 of chapter 6D shall be stayed until the
1752	1752	1742commission determines that the applicant is implementing or has implemented said performance
1753	1753	1743improvement plan in good faith; and provided further, that the commission may rescind its
1754	1754	1744determination that the applicant is implementing a performance improvement plan in good faith
1755	1755	1745at any time prior to successful completion of the performance improvement plan. Applications
1756	1756	1746remanded to the department by the health facilities appeals board under section 25E shall be
1757	1757	1747acted upon by the department within the same time limits provided in this section for the
1758	1758	1748department to approve or disapprove applications for a determination of need. If an application
1759	1759	1749has not been acted upon by the department within such time limits, the applicant may, within a
1760	1760	1750reasonable period of time, bring an action in the nature of mandamus in the superior court to
1761	1761	1751require the department to act upon the application.
1762	1762	1752 SECTION 87. Said section 25C of said chapter 111, as so appearing, is hereby further
1763	1763	1753amended by adding the following 2 subsections:-
1764	1764	1754 (o) Notwithstanding sections (a) through (d), the department may create a process under
1765	1765	1755which persons or entities proposing a project that would normally require a determination of
1766	1766	1756need may apply for a waiver of such requirement. Such waiver shall be granted only in cases in
1767	1767	1757which the person or entity demonstrates the project will address a lack of supply for a specific 81 of 121
1768	1768	1758region, population or service line that has been identified in the state health plan or focused
1769	1769	1759assessments pursuant to section 22 of chapter 6D. The department may require a waiver request
1770	1770	1760be accompanied by forms and information as shall be prescribed by, or acceptable to, the
1771	1771	1761department. A duplicate copy of any waiver request together with supporting documentation for
1772	1772	1762such application shall be a public record and kept on file in the department.
1773	1773	1763 (p) A party of record may review an application for determination of need and provide
1774	1774	1764written comment or specific recommendations for consideration by the department. Whenever a
1775	1775	1765party of record submits written materials concerning an application for determination of need,
1776	1776	1766the department shall provide copies of such materials to all other parties of record.
1777	1777	1767 SECTION 88. Section 25F of said chapter 111, as so appearing, is hereby amended by
1778	1778	1768inserting after the word “care”, in line 7, the following word:- financing.
1779	1779	1769 SECTION 89. Paragraph (4) of subsection (d) of section 51G of said chapter 111, as so
1780	1780	1770appearing, is hereby further amended by inserting, after the third sentence, the following
1781	1781	1771sentence:-
1782	1782	1772 The department may seek an analysis of the impact of the closure from the health policy
1783	1783	1773commission.
1784	1784	1774 SECTION 90. Said subsection (d) of said section 51G of said chapter 111, as so
1785	1785	1775appearing, is hereby further amended by adding the following 2 paragraphs:-
1786	1786	1776 (7) No original license shall be granted or renewed, to establish or maintain an acute-care
1787	1787	1777hospital unless: (i) all documents related to any lease, master lease, sublease, license or any other
1788	1788	1778agreement for the use, occupancy or utilization of the premises occupied by the acute-care 82 of 121
1789	1789	1779hospital are disclosed to the department upon application for licensure; and (ii) the department
1790	1790	1780has reviewed such documentation and determined the applicant is suitable for licensure.
1791	1791	1781 (8) No original license shall be granted, nor renewed, to establish or maintain an acute-
1792	1792	1782care hospital, as defined in section 25B, unless the applicant is in compliance with the reporting
1793	1793	1783requirements established in sections 8 to 10, inclusive, of chapter 12C.
1794	1794	1784 SECTION 91. Section 51H of said chapter 111, as so appearing, is hereby amended by
1795	1795	1785striking out the definition of “Facility” and inserting in place thereof the following definition:
1796	1796	1786 “Facility”, a hospital, institution for the care of unwed mothers, clinic providing
1797	1797	1787ambulatory surgery as defined in section 25B, limited-service clinic licensed pursuant to section
1798	1798	178851J, office-based surgical center licensed pursuant to section 51M or urgent care center licensed
1799	1799	1789pursuant to section 51N.
1800	1800	1790 SECTION 92. Said section 51H of said chapter 111, as so appearing, is hereby further
1801	1801	1791amended by inserting after the definition of “Healthcare-associated infection” the following
1802	1802	1792definition:-
1803	1803	1793 “Operational impairment event”, any action, or notice of impending action, including a
1804	1804	1794notice of financial delinquency, concerning the repossession of medical equipment or supplies
1805	1805	1795necessary for the provision of patient care.
1806	1806	1796 SECTION 93. Subsection (b) of said section 51H of said chapter 111, as so appearing, is
1807	1807	1797hereby amended by adding the following paragraph:-
1808	1808	1798 An operational impairment event shall be reported by a facility to the department not later
1809	1809	1799than 1 calendar day after it occurs. Notwithstanding any general or special law to the contrary, no 83 of 121
1810	1810	1800contract between a facility and a lessor of medical equipment shall authorize the repossession of
1811	1811	1801medical equipment or supplies unless the lessor provides a notice of financial delinquency to the
1812	1812	1802department not less than 90 days prior to repossession of any medical equipment or supplies
1813	1813	1803necessary for the provision of patient care. Any provision of any contract or other document
1814	1814	1804between a lessor of medical equipment and a facility which does not comply with this paragraph
1815	1815	1805shall be void.
1816	1816	1806 SECTION 94. Said chapter 111 is hereby further amended by inserting after section 51L
1817	1817	1807the following 2 sections:-
1818	1818	1808 Section 51M. (a) As used in this section, the following words shall, unless the context
1819	1819	1809clearly requires otherwise, have the following meanings:-
1820	1820	1810 “Deep sedation”, a drug-induced depression of consciousness during which: (i) the
1821	1821	1811patient cannot be easily awakened but responds purposefully following repeated painful
1822	1822	1812stimulation; (ii) the patient’s ability to maintain independent ventilatory function may be
1823	1823	1813impaired; (iii) the patient may require assistance in maintaining a patent airway and spontaneous
1824	1824	1814ventilation may be inadequate; and (iv) the patient’s cardiovascular function is usually
1825	1825	1815maintained without assistance.
1826	1826	1816 “General anesthesia”, a drug-induced depression of consciousness during which: (i) the
1827	1827	1817patient is not able to be awakened, even by painful stimulation; (ii) the patient’s ability to
1828	1828	1818maintain independent ventilatory function is often impaired; (iii) the patient, in many cases, often
1829	1829	1819requires assistance in maintaining a patent airway and positive pressure ventilation may be
1830	1830	1820required because of depressed spontaneous ventilation or drug-induced depression of
1831	1831	1821neuromuscular function; and (iv) the patient’s cardiovascular function may be impaired. 84 of 121
1832	1832	1822 “Minimal sedation”, a drug-induced state during which: (i) patients respond normally to
1833	1833	1823verbal commands; (ii) cognitive function and coordination may be impaired; and (iii) ventilatory
1834	1834	1824and cardiovascular functions are unaffected.
1835	1835	1825 “Minor procedures”, (i) procedures that can be performed safely with a minimum of
1836	1836	1826discomfort where the likelihood of complications requiring hospitalization is minimal; (ii)
1837	1837	1827procedures performed with local or topical anesthesia; or (iii) liposuction with removal of less
1838	1838	1828than 500cc of fat under un-supplemented local anesthesia.
1839	1839	1829 “Moderate sedation”, a drug-induced depression of consciousness during which: (i) the
1840	1840	1830patient responds purposefully to verbal commands, either alone or accompanied by light tactile
1841	1841	1831stimulation; (ii) no interventions are required to maintain a patent airway; (iii) spontaneous
1842	1842	1832ventilation is adequate; and (iv) the patient’s cardiovascular function is usually maintained
1843	1843	1833without assistance.
1844	1844	1834 “Office-based surgical center”, an office, group of offices, a facility or any portion
1845	1845	1835thereof owned, leased or operated by 1 or more practitioners engaged in a solo or group practice,
1846	1846	1836however organized, whether conducted for profit or not for profit, which is advertised,
1847	1847	1837announced, established or maintained for the purpose of providing office-based surgical services;
1848	1848	1838provided, however, that “office-based surgical center” shall not include: (i) a hospital licensed
1849	1849	1839under section 51 or by the federal government; (ii) an ambulatory surgical center as defined
1850	1850	1840pursuant to section 25B and licensed under said section 51; or (iii) a surgical center performing
1851	1851	1841services in accordance with section 12M of chapter 112.
1852	1852	1842 “Office-based surgical services”, an ambulatory surgical or other invasive procedure
1853	1853	1843requiring: (i) general anesthesia; (ii) moderate sedation; or (iii) deep sedation and any liposuction 85 of 121
1854	1854	1844procedure, excluding minor procedures and procedures requiring minimal sedation, where such
1855	1855	1845surgical or other invasive procedure or liposuction is performed by a practitioner at an office-
1856	1856	1846based surgical center.
1857	1857	1847 (b) The department shall establish rules, regulations and practice standards for the
1858	1858	1848licensing of office-based surgical centers. In determining rules, regulations and practice
1859	1859	1849standards necessary for licensure as an office-based surgical center, the department may, at its
1860	1860	1850discretion, determine which regulations applicable to an ambulatory surgical center, as defined in
1861	1861	1851section 25B, shall apply to an office-based surgical center. The department shall consult with the
1862	1862	1852board of registration in medicine and experts in the field of office-based surgical care, including
1863	1863	1853not less than 3 physicians in such field in the commonwealth prior to promulgating regulations or
1864	1864	1854establishing rules or practice standards pursuant to this section.
1865	1865	1855 (c) The department shall issue for a term of 2 years and renew for a like term, a license to
1866	1866	1856maintain an office-based surgical center to an entity or organization that demonstrates to the
1867	1867	1857department that it is responsible and suitable to maintain such a center. An office-based surgical
1868	1868	1858center license shall list the specific locations on the premises where surgical services are
1869	1869	1859provided. In the case of the transfer of ownership of an office-based surgical center, the
1870	1870	1860application of the new owner for a license, when filed with the department on the date of transfer
1871	1871	1861of ownership, shall have the effect of a license for a period of 3 months.
1872	1872	1862 (d) An office-based surgical center license shall be subject to suspension, revocation or
1873	1873	1863refusal to issue or to renew for cause if, in its reasonable discretion, the department determines
1874	1874	1864that the issuance of such license would be inconsistent with the best interests of the public health,
1875	1875	1865welfare or safety. Nothing in this subsection shall limit the authority of the department to require 86 of 121
1876	1876	1866a fee, impose a fine, conduct surveys and investigations or to suspend, revoke or refuse to renew
1877	1877	1867a license issued pursuant to subsection (c).
1878	1878	1868 (e) Initial application and renewal fees for the license shall be established pursuant to
1879	1879	1869section 3B of chapter 7.
1880	1880	1870 (f) The department may impose a fine of up to $10,000 on a person or entity that
1881	1881	1871advertises, announces, establishes or maintains an office-based surgical center without a license
1882	1882	1872granted by the department. The department may impose a fine of not more than $10,000 on a
1883	1883	1873licensed office-based surgical center for violations of this section or any rule or regulation
1884	1884	1874promulgated pursuant to this section. Each day during which a violation continues shall
1885	1885	1875constitute a separate offense. The department may conduct surveys and investigations to enforce
1886	1886	1876compliance with this section.
1887	1887	1877 (g) Notwithstanding any general or special law or rule to the contrary, the department
1888	1888	1878may issue a 1-time provisional license to an applicant for an office-based surgical center licensed
1889	1889	1879pursuant to this section if such office-based surgical center holds: (i) a current accreditation from
1890	1890	1880the Accreditation Association for Ambulatory Health Care, American Association for
1891	1891	1881Accreditation of Ambulatory Surgery Facilities, Inc., or the Joint Commission On Accreditation
1892	1892	1882of Healthcare Organizations; or (ii) a current certification for participation in either Medicare or
1893	1893	1883Medicaid. The department may approve such a provisional application upon a finding of
1894	1894	1884responsibility and suitability and that the office-based surgical center meets all other licensure
1895	1895	1885requirements as determined by the department. Such provisional license issued to an office-based
1896	1896	1886surgical center shall not be extended or renewed. 87 of 121
1897	1897	1887 Section 51N. (a) As used in this section, the following words shall have the following
1898	1898	1888meanings unless the context clearly requires otherwise:-
1899	1899	1889 “Emergency services”, as defined in section 1 of chapter 6D.
1900	1900	1890 “Urgent care center”, a clinic owned or operated by an entity that is not corporately
1901	1901	1891affiliated with a hospital licensed under section 51, however organized, whether conducted for
1902	1902	1892profit or not for profit, that is advertised, announced, established or maintained for the purpose of
1903	1903	1893providing urgent care services in an office or a group of offices, or any portion thereof, or an
1904	1904	1894entity that is advertised, announced, established or maintained under a name that includes the
1905	1905	1895words “urgent care” or that suggests that urgent care services are provided therein and is not
1906	1906	1896corporately affiliated with a hospital licensed under 51; provided, however, that an urgent care
1907	1907	1897center shall not include: (i) a hospital licensed under said section 51 or operated by the federal
1908	1908	1898government or by the commonwealth; (ii) a clinic licensed under said section 51; (iii) a limited
1909	1909	1899service clinic licensed under section 51J; or (iv) a community health center receiving a grant
1910	1910	1900under 42 U.S.C. 254b.
1911	1911	1901 “Urgent care services”, a model of episodic care for the diagnosis, treatment,
1912	1912	1902management or monitoring of acute and chronic disease or injury that is: (i) for the treatment of
1913	1913	1903illness or injury that is immediate in nature but does not require emergency services; (ii)
1914	1914	1904provided on a walk-in basis without a prior appointment; (iii) available to the general public
1915	1915	1905during times of the day, weekends or holidays when primary care provider offices are not
1916	1916	1906customarily open; and (iv) not intended as the patient's primary care provider.
1917	1917	1907 (b) The department shall establish rules, regulations and practice standards for the
1918	1918	1908licensing of urgent care centers. In determining regulations and practice standards necessary for 88 of 121
1919	1919	1909licensure as an urgent care center, the department may, at its discretion, determine which
1920	1920	1910regulations applicable to a clinic licensed under section 51, shall apply to an urgent care center.
1921	1921	1911 (c) The department shall issue for a term of 2 years and renew for a like term, a license to
1922	1922	1912maintain an urgent care center to an entity or organization that demonstrates to the department
1923	1923	1913that it is responsible and suitable to maintain such an urgent care center. In the case of the
1924	1924	1914transfer of ownership of an urgent care center, the application of the new owner for a license,
1925	1925	1915when filed with the department on the date of transfer of ownership, shall have the effect of a
1926	1926	1916license for a period of 3 months.
1927	1927	1917 (d) An urgent care center license shall be subject to suspension, revocation or refusal to
1928	1928	1918issue or to renew for cause if, in its reasonable discretion, the department determines that the
1929	1929	1919issuance of such license would be inconsistent with or opposed to the best interests of the public
1930	1930	1920health, welfare or safety. Nothing in this subsection shall limit the authority of the department to
1931	1931	1921require a fee, impose a fine, conduct surveys and investigations or to suspend, revoke or refuse to
1932	1932	1922renew a license issued pursuant to subsection (c).
1933	1933	1923 (e) Initial application and renewal fees for the license shall be established pursuant to
1934	1934	1924section 3B of chapter 7.
1935	1935	1925 (f) The department may impose a fine of up to $10,000 on a person or entity that
1936	1936	1926advertises, announces, establishes or maintains an urgent care center without a license granted by
1937	1937	1927the department. The department may impose a fine of not more than $10,000 on a licensed
1938	1938	1928urgent care center for violations of this section or any rule or regulation promulgated pursuant to
1939	1939	1929this section. Each day during which a violation continues shall constitute a separate offense. The
1940	1940	1930department may conduct surveys and investigations to enforce compliance with this section. 89 of 121
1941	1941	1931 (g) Notwithstanding any general or special law or rule to the contrary, the department
1942	1942	1932may issue a 1-time provisional license to an applicant for an urgent care center if such urgent
1943	1943	1933care center holds: (i) a current accreditation from the Accreditation Association for Ambulatory
1944	1944	1934Health Care, Urgent Care Association of America or the Joint Commission On Accreditation of
1945	1945	1935Healthcare Organizations; or (ii) a current certification for participation in either Medicare or
1946	1946	1936Medicaid. The department may approve such provisional application upon a finding of
1947	1947	1937responsibility and suitability and that the urgent care center meets all other licensure
1948	1948	1938requirements as determined by the department. Such provisional license issued to an urgent care
1949	1949	1939center shall not be extended or renewed.
1950	1950	1940 SECTION 95. Said section 218 of said chapter 111, as so appearing, is hereby further
1951	1951	1941amended by striking out, in line 28, the words “Maintenance Organizations” and inserting in
1952	1952	1942place thereof the following word:- Plans.
1953	1953	1943 SECTION 96. Said chapter 111, as so appearing, is hereby further amended by inserting
1954	1954	1944after section 244 the following section:-
1955	1955	1945 Section 245. (a) Pursuant to section 23 of chapter 6D, a private equity firm shall deposit,
1956	1956	1946upon submission of a notice of material change pursuant to section 13 of chapter 6D, a bond with
1957	1957	1947the department of public health.
1958	1958	1948 (b) Until such bond has been deposited, the department of public health shall not issue a
1959	1959	1949license to such provider or provider organization under this chapter, the department of mental
1960	1960	1950health shall not issue a license to such provider or provider organization under chapter 19, and
1961	1961	1951any determination of need application submitted under sections 25B to 25G, inclusive, of said
1962	1962	1952chapter 111 or material change notice submitted under section 13 of chapter 6D shall be deemed 90 of 121
1963	1963	1953incomplete. Notwithstanding any general or special law to the contrary, if the bond has not been
1964	1964	1954deposited, but the department of public health would otherwise be eligible to collect the bond,
1965	1965	1955the department shall be permitted to collect from the private equity firm the amount it would
1966	1966	1956have been able to collect had the bond been deposited. (c) The health policy commission
1967	1967	1957shall determine the amount of the bond, which shall equal 1 year of the provider or provider
1968	1968	1958organization’s average or estimated operating expenses, plus the estimated cost of hiring an
1969	1969	1959independent supervisor and reasonable staff to supervise and facilitate collecting and spending
1970	1970	1960the bond. The private equity firm shall maintain the bond for as long as it has a financial interest
1971	1971	1961in the provider or provider organization, and for 7 years thereafter.
1972	1972	1962 (d) The department of public health may collect the bond if the health policy commission
1973	1973	1963provides the department of public health with notification pursuant to subsection (c) of section
1974	1974	196423 of chapter 6D, or if the provider or provider organization in which the private equity firm has
1975	1975	1965or had a financial interest declares bankruptcy. The department of public health, in consultation
1976	1976	1966with the health policy commission and the center for health information and analysis, shall use
1977	1977	1967the bond proceeds to support the continued provision of health services to patients served by the
1978	1978	1968provider or provider organization. Prior to spending the bond, the department of public health
1979	1979	1969shall seek input from the public, including, but not limited to, providers, provider organizations
1980	1980	1970and patients in the affected region, regarding how to spend the bond. The department of public
1981	1981	1971health may, in consultation with the health policy commission and center for health information
1982	1982	1972and analysis, select an independent supervisor and reasonable staff to supervise and facilitate
1983	1983	1973collecting and spending the bond. 91 of 121
1984	1984	1974 SECTION 97. Section 7 of chapter 111D of the General Laws, as so appearing, is hereby
1985	1985	1975amended by striking out, in line 51, the word “three” and inserting in place thereof the following
1986	1986	1976figure:- “5”.
1987	1987	1977 SECTION 98. Section 1 of chapter 112 of the General Laws, as so appearing, is hereby
1988	1988	1978amended by inserting after the third paragraph the following paragraph:-
1989	1989	1979 The commissioner of occupational licensure and the commissioner of public health shall
1990	1990	1980by regulation define the words “good moral character”, establish a standardized assessment of
1991	1991	1981“good moral character” for applicants for certification or licensure. Each of the boards of
1992	1992	1982registration and examination under supervision of the commissioner of occupational licensure
1993	1993	1983and the commissioner of public health shall apply said standard definition and assessment of
1994	1994	1984“good moral character” for applicants of certification or licensure. The commissioners shall hold
1995	1995	1985at least 1 public hearing seeking input on the standard definition and assessment of “good moral
1996	1996	1986character” for applicants of certification or licensure. In developing the standard definition and
1997	1997	1987assessment of “good moral character”, the commissioners shall consider factors including, but
1998	1998	1988not limited to: (i) the nature and gravity of any conduct that would cause concerns about an
1999	1999	1989applicant’s moral character, including whether the conduct demonstrates a disregard for the
2000	2000	1990welfare, safety or rights of another or disregard for honesty, integrity or trustworthiness; (ii) the
2001	2001	1991nature of the job; (iii) the length of time that has passed since the conduct; (iv) the circumstances
2002	2002	1992surrounding the conduct, including the age of the offender and contributing social conditions and
2003	2003	1993biases; (v) evidence of rehabilitation, including subsequent work history and character
2004	2004	1994references; and (vi) racial, ethnic and other inequities in the criminal justice system. 92 of 121
2005	2005	1995 SECTION 99. The sixth paragraph of section 2 of said chapter 112, as so appearing, is
2006	2006	1996hereby amended by striking out the last sentence and inserting in place thereof the following
2007	2007	1997sentence:- The renewal application shall be accompanied by a fee determined under the
2008	2008	1998aforementioned provision and shall include the physician’s name, license number, home address,
2009	2009	1999office address, specialties, the principal setting of their practice and whether they are an active or
2010	2010	2000inactive practitioner.
2011	2011	2001 SECTION 100. Said chapter 112 is hereby further amended by inserting after section 4
2012	2012	2002the following 2 sections:-
2013	2013	2003 Section 4A. (a) For the purposes of this section and section 4B, the following words shall
2014	2014	2004have the following meanings unless the context clearly requires otherwise:
2015	2015	2005 “Clinician without independent practice authority”, a registered practicing clinician who
2016	2016	2006is not a physician, psychologist, licensed independent clinical social worker or nurse practitioner,
2017	2017	2007psychiatric nurse mental health clinical specialist or nurse anesthetist who has independent
2018	2018	2008practice authority pursuant to sections 80E, 80H and 80J.
2019	2019	2009 “Health care practice”, a business, regardless of form, through which a registered
2020	2020	2010practicing clinician offers health services; provided, however, that “health care practice” shall
2021	2021	2011not include any entity that holds a license issued by the department of public health pursuant to
2022	2022	2012sections 51, 51M, 51N or 52 of chapter 111.
2023	2023	2013 “Licensed independent clinical social worker,” a licensed independent clinical social
2024	2024	2014worker who is licensed to practice in the commonwealth pursuant to sections 130 to 137,
2025	2025	2015inclusive. 93 of 121
2026	2026	2016 “Management services organization”, a business that provides management or
2027	2027	2017administrative services to a provider or provider organization for compensation.
2028	2028	2018 “Non-profit hospital health system”, a nonprofit entity that directly or indirectly owns or
2029	2029	2019controls at least 1 nonprofit hospital licensed by the department of public health pursuant to
2030	2030	2020chapter 111.
2031	2031	2021 “Nurse anesthetist”, an advanced practice registered nurse who registered to practice
2032	2032	2022advanced nursing practice in the commonwealth pursuant to sections 74, 80B and 80H.
2033	2033	2023 “Nurse-midwife”, a nurse-midwife who is registered to practice nurse-midwifery in the
2034	2034	2024commonwealth pursuant to sections 74, 80B, 80C and 80G.
2035	2035	2025 “Nurse practitioner”, an advanced practice registered nurse who is registered to practice
2036	2036	2026advanced nursing practice in the commonwealth pursuant to sections 74, 80B and 80E.
2037	2037	2027 “Physician”, a doctor of medicine or doctor of osteopathy who is registered to practice
2038	2038	2028medicine in the commonwealth pursuant to section 2.
2039	2039	2029 “Physician assistant”, a physician assistant who is registered to practice in the
2040	2040	2030commonwealth pursuant to sections 9F and 9I.
2041	2041	2031 “Psychiatric nurse mental health clinical specialist”, an advanced practice registered
2042	2042	2032nurse who is registered to practice advanced nursing practice in the commonwealth pursuant to
2043	2043	2033sections 74, 80B, 80E and 80J.
2044	2044	2034 “Psychologist”, a psychologist licensed to practice psychology in the commonwealth
2045	2045	2035pursuant to sections 118 to 129B, inclusive. 94 of 121
2046	2046	2036 “Registered practicing clinician”, a physician, physician assistant, nurse practitioner,
2047	2047	2037psychiatric nurse mental health clinical specialist, nurse anesthetist, nurse-midwife, psychologist
2048	2048	2038or licensed independent clinical social worker.
2049	2049	2039 (b) No person or entity shall own a health care practice or employ registered practicing
2050	2050	2040clinicians except as specified in this section.
2051	2051	2041 (c)(1) A majority share of a health care practice shall not be owned, alone or in
2052	2052	2042combination, by any person or entity other than: (i) a nonprofit hospital health system; (ii) a
2053	2053	2043hospital that holds a license issued by the department of public health under chapter 111; or (iii)
2054	2054	2044a registered practicing clinician who: (A) holds a license and, when applicable, a certificate of
2055	2055	2045registration, that is issued by the applicable board of registration, neither of which have been
2056	2056	2046suspended or revoked; and (B) is substantially engaged in delivering health care to patients in the
2057	2057	2047commonwealth through the practice or managing of the health care practice. A violation of this
2058	2058	2048section shall constitute the unauthorized practice of medicine in violation of section 6. Nothing
2059	2059	2049in this section shall permit a nurse-midwife to practice beyond the scope established pursuant to
2060	2060	2050section 80G.
2061	2061	2051 (2) It shall constitute the unauthorized practice of medicine in violation of section 6 for
2062	2062	2052any person or entity other than a health care facility or entity that holds a license issued by the
2063	2063	2053department of public health pursuant to sections 51, 51M, 51N or 52 of chapter 111 or a health
2064	2064	2054care practice to employ registered practicing clinicians.
2065	2065	2055 (d) Health care facilities or entities that hold a license issued by the department of public
2066	2066	2056health pursuant to sections 51, 51M, 51N or 52 of chapter 111, health care practices and
2067	2067	2057nonprofit hospital health systems shall not directly or indirectly interfere with, control or 95 of 121
2068	2068	2058otherwise direct the professional judgment or clinical decisions of: (i) registered practicing
2069	2069	2059clinicians who receive compensation from the health care facility or entity or health care practice
2070	2070	2060as employees or independent contractors; (ii) a health care practice fully or partially owned or
2071	2071	2061controlled by a hospital that holds a license issued by the department of public health pursuant to
2072	2072	2062chapter 111 or nonprofit hospital health system; or (iii) said health care practice’s employees.
2073	2073	2063Conduct prohibited under this subsection shall include, but not be limited to, controlling, either
2074	2074	2064directly or indirectly, through discipline, punishment, threats, adverse employment actions,
2075	2075	2065coercion, retaliation or excessive pressure: (i) the amount of time spent with patients, including
2076	2076	2066the time permitted to triage patients in the emergency department or evaluate admitted patients;
2077	2077	2067(ii) the time period within which a patient must be discharged; (iii) decisions involving the
2078	2078	2068patient’s clinical status, including, but not limited to, whether the patient should be kept in
2079	2079	2069observation status, whether the patient should receive palliative care and where the patient
2080	2080	2070should be placed upon discharge; (iv) the diagnosis, diagnostic terminology or codes that are
2081	2081	2071entered into the medical record; or (v) any other conduct the department of public health
2082	2082	2072determines by regulation would interfere with, control or otherwise direct the professional
2083	2083	2073judgement or clinical decisions of clinicians with independent practice authority; provided,
2084	2084	2074however, that the department may establish exceptions to subsections (i) to (v), inclusive, for the
2085	2085	2075appropriate clinical supervision of clinicians without independent practice authority. Such health
2086	2086	2076care facilities or entities, nonprofit hospital health systems or health care practices fully or
2087	2087	2077partially owned by a hospital or nonprofit hospital health system shall not limit the range of
2088	2088	2078clinical orders available to registered practicing clinicians either directly or by configuring the
2089	2089	2079medical record to prohibit or significantly limit the clinical order options available.
2090	2090	2080Nondisclosure or non-disparagement agreements regarding subsections (i) to (v), inclusive, to 96 of 121
2091	2091	2081which health care practices or registered practicing clinicians are a party shall be considered void
2092	2092	2082and unenforceable. Any policy or contract that has the effect of violating this subsection shall be
2093	2093	2083void and unenforceable and shall be considered the unauthorized practice of medicine in
2094	2094	2084violation of section 6. If a court of competent jurisdiction finds a policy, contract or contract
2095	2095	2085provision void and unenforceable pursuant to this subsection, the court shall award the plaintiff
2096	2096	2086reasonable attorney’s fees and costs. Nothing in this section shall limit the ability of any person
2097	2097	2087to bring any action relating to defamation, disclosure of confidential or proprietary information
2098	2098	2088or trade secrets or similar torts.
2099	2099	2089 (e) Health care practices shall provide written certification that the health care practice
2100	2100	2090meets the requirements in this section to the department of public health at the time of formation
2101	2101	2091and on a biennial basis thereafter. Health care practices shall, at the time that such registered
2102	2102	2092practicing clinicians are hired or affiliated with the practice and within 30 days of providing
2103	2103	2093certification to the department of public health pursuant to this section, provide a copy of the
2104	2104	2094most recent certification to all registered practicing clinicians who: (i) engage in providing health
2105	2105	2095services at the health care practice; and (ii) do not hold any ownership interest in the health care
2106	2106	2096practice.
2107	2107	2097 (f) Health care practices shall file with the department of public health a registration
2108	2108	2098application containing such information as the department may reasonably require, including, but
2109	2109	2099not limited to: (i) the identity of the applicant and of the registered practicing clinicians that
2110	2110	2100constitute the practice; (ii) any management services organization under contract with the health
2111	2111	2101care practice; (iii) a certified copy of the health care practice’s certificate of organization, if any,
2112	2112	2102as filed with the secretary of the commonwealth, or any applicable partnership agreement; (iv)
2113	2113	2103the address of the health care practice; (v) the services provided by the health care practice; and 97 of 121
2114	2114	2104(vi) any information the department, in consultation with the health policy commission and the
2115	2115	2105center for health information and analysis, deems relevant for the state health plan and focused
2116	2116	2106assessments pursuant to section 22 of chapter 6D and the health care resources inventory
2117	2117	2107pursuant to section 9 of chapter 12C. The application shall be accompanied by a fee in an amount
2118	2118	2108to be determined pursuant to section 3B of chapter 7. All health care practices registered in the
2119	2119	2109commonwealth shall renew their certificates of registration with the department every 2 years.
2120	2120	2110The department shall share information relevant to the state health plan and focused assessments
2121	2121	2111pursuant to said section 22 of said chapter 6D with the commission and information relevant to
2122	2122	2112the health care resources inventory pursuant to said section 9 of said section 12C with the center.
2123	2123	2113 (g) All health care practices with more than 1 registered practicing clinician that
2124	2124	2114constitutes the practice shall designate a registered practicing clinician at the practice to serve as
2125	2125	2115health care director; provided, however, that the designated clinician shall hold a license issued
2126	2126	2116by the applicable board of registration and, when applicable, a certificate of registration issued
2127	2127	2117by said board, neither of which have been suspended or revoked. The director shall be
2128	2128	2118responsible for implementing policies and procedures to ensure compliance with local
2129	2129	2119ordinances and state and federal laws and regulations governing the practice of medicine or the
2130	2130	2120practice of nursing, including regulations promulgated and policies established by the applicable
2131	2131	2121board. The applicable board may impose discipline against the licenses of the director and
2132	2132	2122registered practicing clinicians who own and control the health care practice for failure of the
2133	2133	2123health care practice to comply with local ordinances and state and federal laws and regulations
2134	2134	2124governing the registered practicing clinician’s practice, including regulations promulgated and
2135	2135	2125policies established by the applicable board. 98 of 121
2136	2136	2126 (h) The department of public health may promulgate regulations to establish minimum
2137	2137	2127requirements for the conduct of a health care practice, including, but not limited to: (i)
2138	2138	2128compliance with this section; (ii) maintenance and access to medical records; and (iii) in the
2139	2139	2129event of a planned closure of the health care practice or an unplanned event that prevents the
2140	2140	2130health care practice from continuing operations, the development of a continuity plan to: (A)
2141	2141	2131ensure access to medical records, (B) provide notice to patients, and (C) assist patients with
2142	2142	2132transitioning to a new provider.
2143	2143	2133 Section 4B. (a) This section shall apply only to health care practices that are not owned or
2144	2144	2134controlled by hospitals licensed by the department of public health under chapter 111 or
2145	2145	2135nonprofit hospital health systems. It shall be a violation of this section for a management services
2146	2146	2136organization or other entity that is not a health care practice to exercise control over clinical
2147	2147	2137decisions of a health care practice. A management services organization, or any other
2148	2148	2138organization that is not a health care practice, that does the following shall be considered to have
2149	2149	2139control over the clinical decisions of the health care practice: (i) managing, supervising,
2150	2150	2140evaluating or recommending promotion or discipline of any owner of or registered practicing
2151	2151	2141clinician associated with the health care practice; (ii) negotiating with third-party payers on
2152	2152	2142behalf of a health care practice without first obtaining informed consent from the health care
2153	2153	2143practice’s owners; (iii) advertising or otherwise presenting as a health care practice or provider of
2154	2154	2144health care services; or (iv) performing any other functions that the department of public health
2155	2155	2145determines, by regulation, confers to a management services organization or any other entity that
2156	2156	2146is not a health care practice the ability to control the clinical decisions of the health care practice
2157	2157	2147or its registered practicing clinicians. 99 of 121
2158	2158	2148 (b) A health care practice shall maintain ultimate decision-making authority over: (i)
2159	2159	2149personnel decisions involving registered practicing clinicians, including, but not limited to,
2160	2160	2150employment status, compensation, hours or working conditions; (ii) coding or billing decisions;
2161	2161	2151(iii) the selection and use of property, including, but not limited to, real property, medical
2162	2162	2152equipment or medical supplies; (iv) the number of patients seen in a given period of time or the
2163	2163	2153amount of time spent with each patient; (v) the appropriate diagnostic test for medical
2164	2164	2154conditions; (vi) the use of patient medical records; (vii) referral decisions; or (viii) any other
2165	2165	2155function or decision that the department of public health determines, by regulation, confers to a
2166	2166	2156management services organization or any other entity that is not a health care practice the ability
2167	2167	2157to control the clinical decisions of a health care practice or its registered practicing clinicians.
2168	2168	2158 (c) It shall be a violation of this section for a management services organization or any
2169	2169	2159other entity that is not a health care practice to include in an agreement with any health care
2170	2170	2160practice provisions that would: (i) restrict the ability of the health care practice or practice owner
2171	2171	2161to exercise complete, unfettered control and discretion over the finances or capital of the health
2172	2172	2162care practice, including, but not limited to, restricting the ability to create, buy or sell stock, issue
2173	2173	2163dividends or sell the health care practice; (ii) restrict the ability of a person who owns stock in
2174	2174	2164the health care practice to transfer, alienate or otherwise exercise unfettered discretion and
2175	2175	2165control over their stock; (iii) restrict, in any way, the ability of the health care practice or
2176	2176	2166clinicians with independent practice authority associated with the health care practice to provide
2177	2177	2167health care services in any place, for any entity or in any form otherwise permitted by law; (iv)
2178	2178	2168restrict the ability of the health care practice to contract with another management services
2179	2179	2169organization for management or administrative services upon expiration of the current contract;
2180	2180	2170(v) limit the ability of the health care practice or the practice’s owners, employees or agents to 100 of 121
2181	2181	2171publicly discuss the business relationship between the health care practice and the management
2182	2182	2172services organization; provided, however, that this provision shall not limit the ability of any
2183	2183	2173person to bring any action relating to defamation, disclosure of confidential or proprietary
2184	2184	2174information or trade secrets or similar torts; (vi) limit access to, take control from or otherwise
2185	2185	2175obscure from any registered practicing clinicians providing services in connection with the health
2186	2186	2176care practice, the price, rate or amount of the charges for their services; (vii) establish, supervise,
2187	2187	2177manage or otherwise control the health care practice’s officers or directors; or (viii) create any
2188	2188	2178other situation the department of public health determines, by regulation, could create the
2189	2189	2179possibility of allowing the management services organization to control the clinical decisions of
2190	2190	2180the health care practice or registered practicing clinicians.
2191	2191	2181 (d) No management services organization shall have any ownership interest in or direct
2192	2192	2182or indirect control over health care practices for which the management services organization
2193	2193	2183provides services. No health care practice shall have any ownership interest in or direct or
2194	2194	2184indirect control over a management services organization unless the management services
2195	2195	2185organization is fully owned, alone or in combination, by: (i) health care practices substantially
2196	2196	2186engaged in delivering health care to patients in the commonwealth; (ii) registered practicing
2197	2197	2187clinicians who both: (A) hold a license from the applicable board of registration and, when
2198	2198	2188applicable, a certificate of registration that is issued by said board, neither of which have been
2199	2199	2189suspended or revoked, and (B) are substantially engaged in delivering health care to patients in
2200	2200	2190the commonwealth; or (iii) hospitals that hold a license issued by the department of public health
2201	2201	2191pursuant to chapter 111 or non-profit hospital health systems. For the purposes of this subsection,
2202	2202	2192a de minimis interest in a publicly traded company held in a mutual fund, index fund or similar
2203	2203	2193financial instrument shall not be considered an ownership interest. 101 of 121
2204	2204	2194 (e) No person shall serve as a director, officer, employee or contractor for both a
2205	2205	2195management services organization and a health care practice for which the management services
2206	2206	2196organization provides services; provided, however, that this subsection shall not apply when a
2207	2207	2197management services organization is fully owned, alone or in combination, by: (i) health care
2208	2208	2198practices substantially engaged in delivering health care to patients in the commonwealth; (ii)
2209	2209	2199registered practicing clinicians who both: (A) hold a license from the applicable board of
2210	2210	2200registration and, when applicable, a certificate of registration that is issued by said board, neither
2211	2211	2201of which have been suspended or revoked; and (B) are substantially engaged in delivering health
2212	2212	2202care to patients in the commonwealth; or (iii) hospitals that hold a license issued by the
2213	2213	2203department of public health pursuant to chapter 111 or nonprofit hospital health systems.
2214	2214	2204 (f) A violation of this section shall constitute the unauthorized practice of medicine in
2215	2215	2205violation of section 6 or the unauthorized practice of nursing in violation of section 80E, 80H or
2216	2216	220680J. Any provision of a contract or agreement that has the effect of violating this section shall be
2217	2217	2207void and unenforceable. If a court of competent jurisdiction finds a policy, contract or contract
2218	2218	2208provision void and unenforceable pursuant to this section, the court shall award the plaintiff
2219	2219	2209reasonable attorney’s fees and costs.
2220	2220	2210 (g) The department of public health, in consultation with the health policy commission,
2221	2221	2211shall promulgate regulations to effectuate the purposes of this section.
2222	2222	2212 SECTION 101. Section 9A of chapter 118E of the General Laws, as appearing in the
2223	2223	22132022 Official Edition, is hereby amended by adding the following paragraph:-
2224	2224	2214 (17) (a) Residents of the commonwealth who are under the age of 19 and enrolled in
2225	2225	2215MassHealth shall qualify for not less than 12 months of continuous eligibility; provided, 102 of 121
2226	2226	2216however, that continuous eligibility shall not apply to: (i) residents who are 19 years of age or
2227	2227	2217older, unless MassHealth provides continuous eligibility to such residents; (ii) individuals who
2228	2228	2218are under the age of 19 and no longer reside in the commonwealth; (iii) residents under the age
2229	2229	2219of 19 who requests voluntary disenrollment or whose representative requests such disenrollment
2230	2230	2220on behalf of said resident; or (iv) residents under the age of 19 whose eligibility is determined to
2231	2231	2221have been erroneously granted because of agency error or fraud, abuse or perjury attributed to
2232	2232	2222said resident or their representative.
2233	2233	2223 (b) The executive office of health and human services shall maximize federal financial
2234	2234	2224participation for the coverage and benefits provided under this section; provided, however, that
2235	2235	2225continuous eligibility under subparagraph (a) shall not result in any reduction of federal financial
2236	2236	2226participation; and provided further, that coverage and benefits provided under this paragraph
2237	2237	2227shall not be contingent upon the availability of federal financial participation.
2238	2238	2228 SECTION 102. Section 9C of chapter 118E of the General Laws, as appearing in the
2239	2239	22292022 Official Edition, is hereby amended by striking out, in line 161, the words “committee on
2240	2240	2230health care” and inserting in place thereof the following words:- joint committee on health care
2241	2241	2231financing.
2242	2242	2232 SECTION 103. Section 1 of chapter 175 of the General Laws, as so appearing, is hereby
2243	2243	2233amended by inserting after the definition of “Foreign company” the following definition:-
2244	2244	2234 “Health insurance company”, a company that engages in the business of health insurance.
2245	2245	2235 SECTION 104. Said section 1 of said chapter 175, as so appearing, is hereby further
2246	2246	2236amended by inserting after the definition of “Net value of policies” the following definition:- 103 of 121
2247	2247	2237 “Party of record”, for the purpose of a review by the commissioner of a written
2248	2248	2238agreement for a merger or consolidation of 2 or more health insurance companies, the health
2249	2249	2239policy commission, the center for health information and analysis, the attorney general, the
2250	2250	2240center for health information and analysis and any government agency with relevant oversight or
2251	2251	2241licensure authority over the proposed project or components therein.
2252	2252	2242 SECTION 105. Section 19A of said chapter 175, as so appearing, is hereby amended by
2253	2253	2243adding the following 2 sentences:-
2254	2254	2244 A party of record may review a written agreement for a merger or consolidation of 2 or
2255	2255	2245more health insurance companies submitted to the commissioner for written approval, as well as
2256	2256	2246provide written comment or specific recommendations for consideration by the commissioner. If
2257	2257	2247a party of record sends a written communication or submits written materials concerning a
2258	2258	2248written agreement, the commissioner shall provide copies of such communication or materials to
2259	2259	2249all other parties of record.
2260	2260	2250 SECTION 106. The fourth paragraph of section 5 of chapter 176A of the General Laws,
2261	2261	2251as so appearing, is hereby amended by inserting after the fourth sentence the following
2262	2262	2252sentence:- In determining whether rates of payment under this section are excessive, the
2263	2263	2253commissioner shall consider the affordability for consumers and purchasers of health insurance
2264	2264	2254products; provided, however, that the commissioner shall not disapprove a carrier’s rates solely
2265	2265	2255on the basis of the affordability standard.
2266	2266	2256 SECTION 107. The second paragraph of section 6 of said chapter 176A, as so appearing,
2267	2267	2257is hereby amended by adding the following sentence:- In determining whether the rates of
2268	2268	2258payment under a contract are excessive under this section, the commissioner shall consider the 104 of 121
2269	2269	2259affordability for consumers and purchasers of health insurance products; provided, however, that
2270	2270	2260the commissioner shall not disapprove a carrier’s rates solely on the basis of the affordability
2271	2271	2261standard.
2272	2272	2262 SECTION 108. The third paragraph of section 10 of said chapter 176A, as so appearing,
2273	2273	2263is hereby amended by inserting after the first sentence the following sentence:- In determining
2274	2274	2264whether the rates of payment under a contract are excessive under this section, the commissioner
2275	2275	2265shall consider the affordability for consumers and purchasers of health insurance products;
2276	2276	2266provided, however, that the commissioner shall not disapprove a carrier’s rates solely on the
2277	2277	2267basis of the affordability standard.
2278	2278	2268 SECTION 109. The second paragraph of section 4 of chapter 176B of the General Laws,
2279	2279	2269as so appearing, is hereby amended by inserting after the second sentence the following
2280	2280	2270sentence:- In determining whether the rates of payment under an agreement are excessive under
2281	2281	2271this section, the commissioner shall consider the affordability for consumers and purchasers of
2282	2282	2272health insurance products; provided, however, that the commissioner shall not disapprove a
2283	2283	2273carrier’s rates solely on the basis of the affordability standard.
2284	2284	2274 SECTION 110. The first paragraph of section 16 of chapter 176G of the General Laws,
2285	2285	2275as so appearing, is hereby amended by inserting after the second sentence the following
2286	2286	2276sentence:- In determining whether the rates of payment under a contract are excessive under this
2287	2287	2277section, the commissioner shall consider the affordability for consumers and purchasers of health
2288	2288	2278insurance products; provided, however, that the commissioner shall not disapprove a carrier’s
2289	2289	2279rates solely on the basis of the affordability standard. 105 of 121
2290	2290	2280 SECTION 111. Subsection (c) of section 6 of chapter 176J of the General Laws, as so
2291	2291	2281appearing, is hereby amended by inserting after the second sentence the following sentence:- In
2292	2292	2282determining whether the proposed changes to base rates of payment are excessive under this
2293	2293	2283section, the commissioner shall consider the affordability for consumers and purchasers of health
2294	2294	2284insurance products; provided, however, that the commissioner shall not disapprove a carrier’s
2295	2295	2285proposed changes to base rates solely on the basis of the affordability standard.
2296	2296	2286 SECTION 112. The second paragraph of subsection (g) of section 7 of chapter 176K of
2297	2297	2287the General Laws, as so appearing, is hereby amended by adding the following sentence:- In
2298	2298	2288determining whether rates of payment are excessive under this section, the commissioner shall
2299	2299	2289consider the affordability for consumers and purchasers of health insurance products; provided,
2300	2300	2290however, that the commissioner shall not disapprove a carrier’s rates solely on the basis of the
2301	2301	2291affordability standard.
2302	2302	2292 SECTION 113. Section 12 of chapter 176O of the General Laws, as so appearing, is
2303	2303	2293amended by adding the following subsections:-
2304	2304	2294 (g) For an insured member who is stable on a treatment, service or course of medication
2305	2305	2295as determined by a health care provider and approved for coverage by a previous carrier or health
2306	2306	2296benefit plan, a carrier or utilization review organization shall not restrict coverage of such
2307	2307	2297treatment, service or course of medication for at least 90 days upon the insured member’s
2308	2308	2298enrollment unless the previously approved admission, procedure, treatment, service or course of
2309	2309	2299medication is not a covered benefit under the insured member’s new plan; provided, however,
2310	2310	2300that a carrier may condition coverage of continued treatment by an out-of-network provider
2311	2311	2301under this subsection upon the out-of-network provider’s agreeing to accept reimbursement from 106 of 121
2312	2312	2302the carrier at the average in-network rate and not to impose cost sharing with respect to the
2313	2313	2303insured in an amount that would exceed the cost sharing imposed if the provider were in
2314	2314	2304network.
2315	2315	2305 (h) Preauthorization approval issued by a carrier for a prescribed maintenance medication
2316	2316	2306shall be valid for the length of the prescription, as written by the prescriber, up to 1 year. For the
2317	2317	2307purposes of this section, “maintenance medication” shall mean a prescribed treatment, or course
2318	2318	2308of medication intended for chronic disease management.
2319	2319	2309 SECTION 114. Section 21 of said chapter 176O, as so appearing, is hereby amended by
2320	2320	2310adding the following subsection:-
2321	2321	2311 (f) The commissioner shall make all information submitted to the division pursuant to
2322	2322	2312this section available to the center for health information and analysis.
2323	2323	2313 SECTION 115. The General Laws are hereby amended by inserting after chapter 176X
2324	2324	2314the following chapter:-
2325	2325	2315 Chapter 176Y. LICENSING AND REGULATION OF PHARMACY BENEFIT
2326	2326	2316MANAGERS.
2327	2327	2317 Section 1. As used in this chapter, the following words shall have the following meanings
2328	2328	2318unless the context clearly requires otherwise:
2329	2329	2319 “Carrier”, an insurer licensed or otherwise authorized to transact accident or health
2330	2330	2320insurance under chapter 175, a nonprofit hospital service corporation organized under chapter
2331	2331	2321176A, a nonprofit medical service corporation organized under chapter 176B, a health
2332	2332	2322maintenance organization organized under chapter 176G or an organization entering into a 107 of 121
2333	2333	2323preferred provider arrangement under chapter 176I; provided, however, that “carrier” shall not
2334	2334	2324include an employer purchasing coverage or acting on behalf of its employees or the employees
2335	2335	2325of a subsidiary or affiliated corporation of the employer; and provided further, that unless
2336	2336	2326otherwise provided, “carrier” shall not include any entity to the extent it offers a policy,
2337	2337	2327certificate or contract that provides coverage solely for dental care services or vision care
2338	2338	2328services.
2339	2339	2329 “Center”, the center for health information and analysis established under chapter 12C.
2340	2340	2330 “Commissioner”, the commissioner of insurance.
2341	2341	2331 “Division”, the division of insurance.
2342	2342	2332 “Health benefit plan”, a contract, certificate or agreement entered into, offered or issued
2343	2343	2333by a carrier to provide, deliver, arrange for, pay for or reimburse any of the costs of health care
2344	2344	2334services; provided, however, that the commissioner may, by regulation, define other health
2345	2345	2335coverage as a “health benefit plan” for the purposes of this chapter.
2346	2346	2336 “Pharmacy”, a physical or electronic facility under the direction or supervision of a
2347	2347	2337registered pharmacist that is authorized to dispense prescription drugs and has entered into a
2348	2348	2338network contract with a pharmacy benefit manager or a carrier.
2349	2349	2339 “Pharmacy benefit manager”, a person, business or other entity, however organized, that
2350	2350	2340directly or through a subsidiary provides pharmacy benefit management services for prescription
2351	2351	2341drugs and devices on behalf of a health benefit plan sponsor, including, but not limited to, a self-
2352	2352	2342insurance plan, labor union or other third-party payer; provided, however, that pharmacy benefit
2353	2353	2343management services shall include, but not be limited to: (i) the processing and payment of 108 of 121
2354	2354	2344claims for prescription drugs; (ii) the performance of drug utilization review; (iii) the processing
2355	2355	2345of drug prior authorization requests; (iv) pharmacy contracting; (v) the adjudication of appeals or
2356	2356	2346grievances related to prescription drug coverage contracts; (vi) formulary administration; (vii)
2357	2357	2347drug benefit design; (viii) mail and specialty drug pharmacy services; (ix) cost containment; (x)
2358	2358	2348clinical, safety and adherence programs for pharmacy services; and (xi) management of the cost
2359	2359	2349of covered prescription drugs; and provided further, that “pharmacy benefit manager” shall not
2360	2360	2350include a health benefit plan sponsor unless otherwise specified by the division.
2361	2361	2351 Section 2. (a) No person, business or other entity shall establish or operate as a pharmacy
2362	2362	2352benefit manager without obtaining a license from the division pursuant to this section. A license
2363	2363	2353may be granted if the division is satisfied that the applicant possesses the necessary organization,
2364	2364	2354background expertise and financial integrity to supply the services sought to be offered. A
2365	2365	2355pharmacy benefit manager license shall be valid for a period of 3 years and shall be renewable
2366	2366	2356for additional 3-year periods. The commissioner shall charge application and renewal fees in the
2367	2367	2357amount of $25,000. In no event may these fees, when combined with the assessment of
2368	2368	2358pharmacy benefit managers in section 6 of chapter 6D and section 7 of chapter 12C, exceed the
2369	2369	2359commonwealth’s estimated operating expenses of the pharmacy benefit manager licensure
2370	2370	2360program.
2371	2371	2361 (b) A license granted pursuant to this section and any rights or interests therein shall not
2372	2372	2362be transferable.
2373	2373	2363 (c) A person, business or other entity licensed as a pharmacy benefit manager shall
2374	2374	2364submit data and reporting information to the center according to the standards and methods
2375	2375	2365specified by the center pursuant to section 10A of chapter 12C. 109 of 121
2376	2376	2366 (d) The division may issue or renew a license pursuant to this section, subject to
2377	2377	2367restrictions in order to protect the interests of consumers. Such restrictions may include: (i)
2378	2378	2368limiting the type of services that a license holder may provide; (ii) limiting the activities in which
2379	2379	2369the license holder may be engaged; or (iii) addressing conflicts of interest between pharmacy
2380	2380	2370benefit managers and health plan sponsors.
2381	2381	2371 (e) The division shall develop an application for the licensure of pharmacy benefit
2382	2382	2372managers that shall include, but not be limited to: (i) the name of the applicant or pharmacy
2383	2383	2373benefit manage; (ii) the address and contact telephone number for the applicant; (iii) the name
2384	2384	2374and address of the agent of the applicant or pharmacy benefit manager for service of process in
2385	2385	2375the commonwealth; (iv) the name and address of any person with management or control over
2386	2386	2376the applicant or pharmacy benefit manager; and (v) any audited financial statements specific to
2387	2387	2377the applicant or pharmacy benefit manager. An applicant or pharmacy benefit manager shall
2388	2388	2378inform the division any material change to the information contained in its application, certified
2389	2389	2379by an officer of the applicant, within 30 days of such a change; provided, however, that, once
2390	2390	2380licensed, a pharmacy benefit manager shall inform the division of any material change to the
2391	2391	2381information contained in its application, certified by an officer of the pharmacy benefit manager.
2392	2392	2382 (f) The division may suspend, revoke, refuse to issue or renew or place on probation an
2393	2393	2383application or pharmacy benefit manager license for cause, which shall include, but not be
2394	2394	2384limited to: (i) the applicant or pharmacy benefit manager engaging in fraudulent activity that is
2395	2395	2385found by a court of law to be a violation of state or federal law; (ii) the division receiving
2396	2396	2386consumer complaints that justify an action under this chapter to protect the health, safety and
2397	2397	2387interests of consumers; (iii) the applicant or pharmacy benefit manager failing to pay an
2398	2398	2388application or renewal fee for a license; (iv) the applicant or pharmacy benefit manager failing to 110 of 121
2399	2399	2389comply with reporting requirements of the center under section 10A of chapter 12C; or (v) the
2400	2400	2390applicant or pharmacy benefit manager failing to comply with a requirement of this chapter.
2401	2401	2391 The division shall provide written notice to the applicant or pharmacy benefit manager
2402	2402	2392and advise in writing of the reason for any suspension, revocation, refusal to issue or renew or
2403	2403	2393placement on probation of an application or pharmacy benefit manager license. A copy of the
2404	2404	2394notice shall be forwarded to the center. The applicant or pharmacy benefit manager may make a
2405	2405	2395written demand upon the division within 30 days of receipt of such notice for a hearing before
2406	2406	2396the division to determine the reasonableness of the division’s action. The hearing shall be held
2407	2407	2397pursuant to chapter 30A.
2408	2408	2398 The division shall not suspend or cancel a license unless the division has first afforded
2409	2409	2399the pharmacy benefit manager an opportunity for a hearing pursuant to said chapter 30A.
2410	2410	2400 (g) If a person, business or other entity performs the functions of a pharmacy benefit
2411	2411	2401manager in violation of this chapter, the person, business or other entity shall be subject to a fine
2412	2412	2402of $5,000 per day for each day that the person, business or other entity is found to be in violation.
2413	2413	2403 (h) A pharmacy benefit manager licensed under this section shall notify a health carrier
2414	2414	2404client in writing of any activity, policy, practice contract or arrangement of the pharmacy benefit
2415	2415	2405manager that directly or indirectly presents any conflict of interest to the pharmacy benefit
2416	2416	2406manager’s relationship with or obligation to the health carrier client.
2417	2417	2407 (i) The division shall promulgate regulations and adopt policies and procedures necessary
2418	2418	2408to implement this section. 111 of 121
2419	2419	2409 SECTION 116. There shall be a task force to: (i) study primary care access, delivery and
2420	2420	2410payment in the commonwealth; (ii) develop and issue recommendations to stabilize and
2421	2421	2411strengthen the primary care system and the increase of recruitment and retention in the primary
2422	2422	2412care workforce; and (iii) increase the financial investment in and patient access to primary care
2423	2423	2413across the commonwealth.
2424	2424	2414 (b) The task force shall consist of: the secretary of health and human services or a
2425	2425	2415designee, who shall serve as co-chair; the executive director of the health policy commission or a
2426	2426	2416designee, who shall serve as co-chair; the assistant secretary for MassHealth or a designee; the
2427	2427	2417executive director of the center for health information and analysis or a designee; the
2428	2428	2418commissioner of insurance or a designee; the chairs of the joint committee on health care
2429	2429	2419financing or their designees; 1 member from the Massachusetts Academy of Family Physicians,
2430	2430	2420Inc.; 1 member from the Massachusetts Chapter of the American Academy of Pediatrics; 1
2431	2431	2421member from a rural health care practice with expertise in primary care; 1 member from
2432	2432	2422Community Care Cooperative, Inc.; 1 member from the Massachusetts Medical Society with
2433	2433	2423expertise in primary care; 1 member from the Massachusetts Coalition of Nurse Practitioners,
2434	2434	2424Inc. with expertise in primary care or in delivering care in a community health center; 1 member
2435	2435	2425from the Massachusetts Association of Physician Assistants, Inc. with expertise in primary care;
2436	2436	24261 member from the National Association of Social Workers, Inc. – Massachusetts Chapter with
2437	2437	2427expertise in behavioral health in a primary care setting; 1 member from the Massachusetts
2438	2438	2428League of Community Health Centers, Inc.; 1 member from the Massachusetts Health and
2439	2439	2429Hospital Association, Inc.; 1 member from the Massachusetts Association of Health Plans, Inc.;
2440	2440	24301 member from Blue Cross and Blue Shield of Massachusetts, Inc.; 1 member from the
2441	2441	2431Association Industries of Massachusetts; 1 member from the Retailers Association of 112 of 121
2442	2442	2432Massachusetts, Inc.; 1 member from Health Care For All, Inc.; 1 member from the
2443	2443	2433Massachusetts Chapter of the American College of Physicians; 1 member from the
2444	2444	2434Massachusetts Primary Care Alliance for Patients; and 1 member from Massachusetts Health
2445	2445	2435Quality Partners, Inc.
2446	2446	2436 (c) The task force shall develop recommendations to: (i) define primary care services,
2447	2447	2437codes and providers; (ii) develop a standardized set of data reporting requirements for private
2448	2448	2438and public health care payers, providers and provider organizations to enable the commonwealth
2449	2449	2439and private and public health care payers to track payments for primary care services, including,
2450	2450	2440but not limited to, fee-for-service, prospective payments, value-based payments and grants to
2451	2451	2441primary care providers, fees levied on a primary care provider by a provider organization or
2452	2452	2442hospital system of which the primary care provider is affiliated and provider spending on
2453	2453	2443primary care services; (iii) establish a primary care spending target for private and public health
2454	2454	2444care payers that reflects the cost to deliver evidence-based, equitable and culturally competent
2455	2455	2445primary care; (iv) propose payment models to increase private and public reimbursement for
2456	2456	2446primary care services; (v) assess the impact of health plan design on health equity and patient
2457	2457	2447access to primary care services; (vi) monitor and track the needs of and service delivery to
2458	2458	2448residents of the commonwealth; and (vii) create a short-term and long-term workforce
2459	2459	2449development plan to increase the supply and distribution of and improve working conditions of
2460	2460	2450primary care clinicians and other primary care workers. The task force may make additional
2461	2461	2451recommendations and propose legislation necessary to carry out its recommendations.
2462	2462	2452 (d) The task force shall, in consultation with the center for health information and
2463	2463	2453analysis, define the data required to satisfy the contents of this section. The center for health
2464	2464	2454information and analysis shall adopt regulations to require providers and private and public 113 of 121
2465	2465	2455health care payers to submit data or information necessary for the task force to fulfill its duties
2466	2466	2456with this section. Any data collected shall be public and available through the Massachusetts
2467	2467	2457Primary Care Dashboard maintained by the center and Massachusetts Health Quality Partners,
2468	2468	2458Inc.
2469	2469	2459 (e) Not later than March 15, 2025, the task force shall issue its report of the findings and
2470	2470	2460recommendations under clauses (i) and (ii) of subsection (c) with the clerks of the senate and the
2471	2471	2461house of representatives, the senate and house committees on ways and means, the joint
2472	2472	2462committee on health care financing, the center for health information and analysis, the health
2473	2473	2463policy commission and the division of insurance.
2474	2474	2464 (f) Not later than June 15, 2025, the task force shall issue its report of the findings and
2475	2475	2465recommendations under clause (iii) of subsection (c) with the clerks of the senate and the house
2476	2476	2466of representatives, the senate and house committees on ways and means, the joint committee on
2477	2477	2467health care financing, the center for health information and analysis, the health policy
2478	2478	2468commission and the division of insurance.
2479	2479	2469 (g) Not later than September 15, 2025, the task force shall issue its report of the findings
2480	2480	2470and recommendations under clauses (iv) and (v) of subsection (c) with the clerks of the senate
2481	2481	2471and the house of representatives, the senate and house committees on ways and means, the joint
2482	2482	2472committee on health care financing, the center for health information and analysis, the health
2483	2483	2473policy commission and the division of insurance.
2484	2484	2474 (h) Not later than December 15, 2025, the task force shall issue its report of the findings
2485	2485	2475and recommendations under clauses (vi) and (vii) of subsection (c) with the clerks of the senate
2486	2486	2476and the house of representatives, the senate and house committees on ways and means, the joint 114 of 121
2487	2487	2477committee on health care financing, the center for health information and analysis, the health
2488	2488	2478policy commission and the division of insurance.
2489	2489	2479 SECTION 117. (a) There shall be a task force to study the use of prior authorization for
2490	2490	2480health care services and its impact on overall costs in the health care system, and delivery of and
2491	2491	2481access to high quality health care. The task force shall consist of 12 members: the executive
2492	2492	2482director of the health policy commission or a designee, who shall serve as co-chair; the
2493	2493	2483commissioner of insurance or a designee, who shall serve as co-chair; the assistant secretary for
2494	2494	2484MassHealth; the executive director of the group insurance commission; 1 representative from the
2495	2495	2485Massachusetts Association of Health Plans, Inc.; 1 representative from Blue Cross and Blue
2496	2496	2486Shield of Massachusetts, Inc.; 1 representative from the Massachusetts Medical Society; 1
2497	2497	2487representative from Massachusetts Association for Mental Health, Inc.; 1 representative from the
2498	2498	2488Massachusetts Health and Hospital Association, Inc.; 1 representative from the Massachusetts
2499	2499	2489Academy of Family Physicians, Inc.; 1 representative from the Massachusetts League of
2500	2500	2490Community Health Centers, Inc.; 1 representative from Massachusetts Taxpayers Foundation,
2501	2501	2491Inc.; 1 representative from Associated Industries of Massachusetts; and 1 representative from
2502	2502	2492Health Care For All, Inc.
2503	2503	2493 (b) The task force shall analyze: (i) the services, treatments and medications that require
2504	2504	2494prior authorization by payers in Massachusetts; (ii) the factors used by payers to determine
2505	2505	2495whether a service, treatment or medication is appropriate for prior authorization, including
2506	2506	2496considerations of potential for provider abrasion, adverse impacts on health outcomes, the
2507	2507	2497availability, and comparative cost and effectiveness of alternative treatment options and risk of
2508	2508	2498provider overuse of the treatment; (iii) the processes used by payers to obtain prior authorization
2509	2509	2499for a service, treatment or medication; (iv) the potential for streamlining prior authorization 115 of 121
2510	2510	2500processes using automation, electronic submissions, gold carding or other means; (v) actuarial
2511	2511	2501analysis of the impact of prior authorization requirements on the commonwealth’s efforts to meet
2512	2512	2502the health care cost benchmark established under section 9 of chapter 6D; (vi) any state and
2513	2513	2503federal laws requiring or limiting prior authorization by public or private payers for a service,
2514	2514	2504treatment or medication; (vii) the feasibility of an easily accessible, publicly available website
2515	2515	2505with up-to-date information that provides information regarding utilization review requirements
2516	2516	2506for treatments; (viii) the services that have no or low prior authorization denial rates across
2517	2517	2507carriers; (ix) administrative barriers preventing active prior authorizations to continue for their
2518	2518	2508approved duration in instances where an insured individual transitions to a new plan with the
2519	2519	2509same carrier or to a new carrier; (x) expedited utilization review processes across carriers; and
2520	2520	2510(xi) barriers to and solutions for providing uniformity in processes or requirements among
2521	2521	2511different health care segments, including Medicaid, Medicare, fully-insured and self-insured
2522	2522	2512commercial plans.
2523	2523	2513 (c) The task force shall develop recommendations regarding: (i) simplifying and
2524	2524	2514standardizing prior authorization for evidence-based treatments, services or courses of
2525	2525	2515medication; (ii) improving access to medically necessary covered services for patients; (iii)
2526	2526	2516reducing the response time from a carrier or utilization review organization for prior
2527	2527	2517authorization approvals and denials; (iv) reducing administrative barriers and costs related to
2528	2528	2518prior authorization on health care providers; (v) limiting the recoupment and denial of claims for
2529	2529	2519medically necessary covered services; (vi) increasing transparency for covered benefits and prior
2530	2530	2520authorization requirements; (vii) standardizing prior authorization processes, forms and
2531	2531	2521requirements for use across health insurance carriers; (viii) eliminating prior authorization
2532	2532	2522requirements for services, treatments, procedures and prescription drugs that have low variation 116 of 121
2533	2533	2523in utilization across providers or low denial rates; (ix) eliminating prior authorization for or
2534	2534	2524reducing the prior authorization review process to 24 hours for emergency treatments, services or
2535	2535	2525courses of medication; (x) ensuring any physician or personnel under the supervision of a
2536	2536	2526physician that is reviewing a prior authorization request for a carrier has the clinical expertise to
2537	2537	2527treat the medical condition or disease that is the subject of the request; and (xi) removing prior
2538	2538	2528authorization for certain chronic disease management.
2539	2539	2529 (d) The task force shall develop a report of its findings and recommendations, including
2540	2540	2530any legislative or regulatory changes necessary to implement its recommendations. The task
2541	2541	2531force shall file its report with the clerks of the senate and the house of representatives, the senate
2542	2542	2532and house committees on ways and means and the joint committee on health care financing not
2543	2543	2533later than July 31, 2025.
2544	2544	2534 SECTION 118. The department of public health shall study and make recommendations
2545	2545	2535on improving the effectiveness and efficiency of electronic health records in the commonwealth
2546	2546	2536for the purpose of supporting the commonwealth’s efforts in meeting the health care cost growth
2547	2547	2537benchmark established in chapter 6D of the General Laws. The study shall contain information
2548	2548	2538and recommendations on topics related to electronic health records, including, but not limited to:
2549	2549	2539(i) containing costs for providers, payors and consumers; (ii) accessibility and interoperability;
2550	2550	2540(iii) barriers to efficient exchange of patient information through electronic health records; (iv)
2551	2551	2541the impact of electronic health records on the administrative burden on providers; (v) the impacts
2552	2552	2542on patient care from delayed information exchanged on electronic health records; and (vi)
2553	2553	2543opportunities and measures to improve the operation of electronic health records in the
2554	2554	2544commonwealth. Prior to submitting recommendations, the department shall consult with
2555	2555	2545stakeholders, including, but not limited to, physicians, hospitals, providers of electronic health 117 of 121
2556	2556	2546records and consumer advocates. Not later than December 31, 2025, the department shall file the
2557	2557	2547report with the clerks of the senate and house of representatives, the senate and house
2558	2558	2548committees on ways and means, and the joint committee on health care financing.
2559	2559	2549 SECTION 119. Notwithstanding any general or special law to the contrary, the division
2560	2560	2550of insurance shall consider the recommendations issued by the task force established in section
2561	2561	2551111 in developing and implementing rules, regulations, bulletins or other guidance to simplify
2562	2562	2552health insurance prior authorization standards and processes.
2563	2563	2553 SECTION 120. (a) Notwithstanding any general or special law to the contrary, the
2564	2564	2554secretary of health and human services shall direct monthly payments to eligible hospitals in the
2565	2565	2555form of enhanced Medicaid payments, supplemental payments or other appropriate mechanisms.
2566	2566	2556Each payment made to an eligible hospital shall be allocated in direct proportion to each eligible
2567	2567	2557hospital’s average monthly Medicaid payments, as determined by the secretary, for inpatient and
2568	2568	2558outpatient acute hospital services for the preceding year or the most recent year for which data is
2569	2569	2559available; provided, however, that such enhanced Medicaid payments shall not be used in
2570	2570	2560subsequent years by the secretary to calculate an eligible hospital’s average monthly payment;
2571	2571	2561and provided further, that such payments shall not offset existing Medicaid payments for which
2572	2572	2562an eligible hospital may be qualified to receive. In any fiscal year, the total sum of all payments
2573	2573	2563made to eligible hospitals under this section shall not exceed $45,000,000. Eligible hospitals may
2574	2574	2564consider expending said payments to strengthen behavioral health supports and services.
2575	2575	2565 (b) The secretary may require as a condition of receiving payment any such reasonable
2576	2576	2566condition of payment that the secretary determines necessary to ensure the availability, to the
2577	2577	2567extent possible, of federal financial participation for the payments and the secretary may incur 118 of 121
2578	2578	2568expenses and the comptroller may certify amounts for payment in anticipation of expected
2579	2579	2569receipt of federal financial participation for the payments.
2580	2580	2570 (c) The executive office of health and human services may promulgate regulations as
2581	2581	2571necessary to carry out this section.
2582	2582	2572 (d) For the purposes of this section “eligible hospital” shall mean an acute care hospital
2583	2583	2573licensed under section 51 of chapter 111 of the General Laws that: (i) has a statewide relative
2584	2584	2574price less than 0.99, as calculated by the center for health information and analysis according to
2585	2585	2575data from the most recent available year; (ii) has a public payer mix greater than 63 per cent, as
2586	2586	2576calculated by the center for health information and analysis according to data from the most
2587	2587	2577recent available year; and (iii) is not owned by or financially consolidated or corporately
2588	2588	2578affiliated with a provider organization, as defined by section 1 of chapter 6D of the General
2589	2589	2579Laws and as reported by the center for health information and analysis in the fiscal year 2022
2590	2590	2580hospital cost report database: (1) owns or controls 4 or more acute care hospitals licensed under
2591	2591	2581said section 51 of said chapter 111; or (2) through which the total net assets of all affiliated acute
2592	2592	2582care hospitals within the provider organization is greater than $800,000,000.
2593	2593	2583 (e) For the purposes of subsection (d), a clinical affiliation with a provider organization,
2594	2594	2584absent ownership, financial consolidation or corporate affiliation, shall not disqualify an eligible
2595	2595	2585hospital from payments authorized under this section.
2596	2596	2586 SECTION 121. (a) Notwithstanding any general or special law to the contrary, for the
2597	2597	2587purposes of monitoring and enforcing the health care cost growth benchmark for calendar years
2598	2598	25882021 to 2025, inclusive, the center for health information and analysis shall apply sections 8, 9, 119 of 121
2599	2599	258910, 16 and 18 of chapter 12C of the General Laws as those sections are in effect on December 1,
2600	2600	25902024.
2601	2601	2591 (b) Notwithstanding any general or special law to the contrary, for the purposes of
2602	2602	2592monitoring and enforcing the health care cost growth benchmark for calendar years 2021 to
2603	2603	25932025, inclusive, the health policy commission shall apply sections 9 and 10 of chapter 6D of the
2604	2604	2594General Laws as those sections are in effect on December 1, 2024.
2605	2605	2595 (c) Notwithstanding any general or special law to the contrary, the first benchmark cycle
2606	2606	2596shall consist of the years 2025 and 2026. The health care cost growth benchmark for that
2607	2607	2597benchmark cycle shall be the average of the 2025 health care cost growth benchmark that the
2608	2608	2598health policy commission governing board established in 2024 and the growth rate of potential
2609	2609	2599gross state product for 2026 established under section 7H½ of chapter 29 of the General Laws.
2610	2610	2600 (d) Notwithstanding any general or special law to the contrary, not later than April 15,
2611	2611	26012025, the board shall establish the health care cost growth benchmark pursuant to section 9 of
2612	2612	2602chapter 6D of the general laws for: (i) the benchmark cycle consisting of the years 2025 and
2613	2613	26032026; and (ii) the benchmark cycle consisting of the years 2026 and 2027.
2614	2614	2604 (e) Notwithstanding any general or special law to the contrary, on or before January 15,
2615	2615	26052025, the secretary and house and senate committees on ways and means shall jointly develop
2616	2616	2606growth rates of potential gross state product pursuant to section 7H½ of chapter 29 of the
2617	2617	2607General Laws for each of the calendar years of 2026 and 2027.
2618	2618	2608 SECTION 122. Notwithstanding any general or special law, rule or regulation to the
2619	2619	2609contrary, section 13 of chapter 6D of the General Laws, as amended by this act, shall apply only
2620	2620	2610to material change notices submitted after the effective date of this act; provided, however, that 120 of 121
2621	2621	2611said section 13 of said chapter 6D shall apply to material changes that meet all of the following
2622	2622	2612criteria: (i) the health policy commission received a completed material change notice regarding
2623	2623	2613the material change on or after March 1, 2024; (ii) the health policy commission has not yet
2624	2624	2614determined whether to conduct a cost and market impact review in regard to the material change;
2625	2625	2615and (iii) the health policy commission classifies the material change as involving a provider or
2626	2626	2616provider organization’s merger or affiliation resulting in an increase in net patient service
2627	2627	2617revenue of $10,000,000 or more. For such material change notices, the health policy commission
2628	2628	2618shall be permitted to require submission of a new or revised material change form, request
2629	2629	2619additional documentation and information and take an additional 30 days to conduct its
2630	2630	2620preliminary review.
2631	2631	2621 SECTION 123. Notwithstanding any general or special law, rule or regulation to the
2632	2632	2622contrary, the health policy commission shall submit the first state health plan to the governor and
2633	2633	2623the general court, as required under section 22 of chapter 6D of the General Laws, on or before
2634	2634	2624January 1, 2026.
2635	2635	2625 SECTION 124. Notwithstanding any general or special law to the contrary, section 23 of
2636	2636	2626said chapter 6D shall only apply to private equity firms that obtain a financial interest in a
2637	2637	2627provider or provider organization and to financial actions taken by registered provider
2638	2638	2628organizations with private equity investment after the effective date of this act.
2639	2639	2629 SECTION 125. Notwithstanding any general or special law, rule or regulation to the
2640	2640	2630contrary, section 4B of chapter 112 of the General Laws shall apply only to contracts or
2641	2641	2631agreements between health care practices and management services organizations entered into
2642	2642	2632after the effective date of this act. 121 of 121
2643	2643	2633 SECTION 126. Section 17 shall take effect on January 1, 2025.
2644	2644	2634 SECTION 127. Section 67 shall take effect on August 1, 2025.
2645	2645	2635 SECTION 128. All health care practices required to register pursuant to section 4A of
2646	2646	2636chapter 112 of the General Laws shall register with the board of registration in medicine not later
2647	2647	2637than January 1, 2026.
2648	2648	2638 SECTION 129. The commissioner of occupational licensure and the commissioner of
2649	2649	2639public health shall adopt the regulations required under section 96 not later than 6 months after
2650	2650	2640the effective date of this act.
2651	2651	2641 SECTION 130. The division of insurance shall adopt the rules and regulations required
2652	2652	2642under section 112 not later than 6 months after the task force established in section 111 issues its
2653	2653	2643final report and recommendations.
2654	2654	2644 SECTION 131. Section 113 is hereby repealed.
2655	2655	2645 SECTION 132. Section 124 shall take effect 2 years from the effective date of this act.