EXPLANATION: CAPITALS INDICATE MAT TER ADDED TO EXISTIN G LAW.
[Brackets] indicate matter deleted from existing law.
Underlining indicates amendments to bill.
Strike out indicates matter stricken from the bill by amendment or deleted from the law by
amendment.
*hb1148*
HOUSE BILL 1148
J5 2lr1705
CF SB 834
By: Delegates Pendergrass, Cullison, and Kipke Kipke, Bagnall, Belcastro,
Bhandari, Carr, Chisholm, Hill, Johnson, Kaiser, Kelly, Kerr, Krebs, Landis,
R. Lewis, Morgan, Reilly, Rosenberg, Saab, Szeliga, and K. Young
Introduced and read first time: February 11, 2022
Assigned to: Health and Government Operations
Committee Report: Favorable with amendments
House action: Adopted
Read second time: March 7, 2022
CHAPTER ______
AN ACT concerning 1
Health Insurance – Two–Sided Incentive Arrangements and Capitated 2
Payments – Authorization 3
FOR the purpose of providing that value–based arrangements established under certain 4
provisions of federal law are exempt from certain provisions of State law regulating 5
health care practitioner referrals; providing that a health care practitioner or set of 6
health care practitioners that accepts capitated payments in a certain manner but 7
does not perform certain other acts is not considered to be performing acts of an 8
insurance business; authorizing certain bonus or incentive–based compensation to 9
include a two–sided incentive arrangement through which a carrier may recoup 10
funds paid to an eligible provider in accordance with a written contract that includes 11
certain requirements; prohibiting a carrier from requiring participation in a carrier’s 12
bonus or incentive–based compensation or two–sided incentive arrangement 13
program or reducing a fee schedule based on nonparticipation; prohibiting 14
participation in a two–sided incentive arrangement from being the sole opportunity 15
for increases in reimbursement; and generally relating to health insurance, 16
two–sided incentive arrangements, and capitated payments. 17
BY repealing and reenacting, with amendments, 18
Article – Health Occupations 19
Section 1–302(d)(12) 20
Annotated Code of Maryland 21
(2021 Replacement Volume) 22 2 HOUSE BILL 1148
BY repealing and reenacting, with amendments, 1
Article – Insurance 2
Section 4–205(a), 15–113, and 15–1008(b) 3
Annotated Code of Maryland 4
(2017 Replacement Volume and 2021 Supplement) 5
BY repealing and reenacting, without amendments, 6
Article – Insurance 7
Section 4–205(b) and (c) and 15–1008(c) 8
Annotated Code of Maryland 9
(2017 Replacement Volume and 2021 Supplement) 10
BY adding to 11
Article – Insurance 12
Section 15–2101 and 15–2102 to be under the new subtitle “Subtitle 21. Capitated 13
Payments” 14
Annotated Code of Maryland 15
(2017 Replacement Volume and 2021 Supplement) 16
Preamble 17
WHEREAS, Value–based care is a health care practitioner payment structure that 18
ties practitioner revenue to improved health outcomes and the value of services delivered 19
rather than the volume of services provided; and 20
WHEREAS, Value–based arrangements may help to reduce disparities, expand 21
access to care, and improve outcomes, quality, and affordability; and 22
WHEREAS, Value–based care models promote the Triple Aim framework used by 23
the Centers for Medicare and Medicaid Services to optimize health care systems through 24
better care and experience for individuals, better health for populations, and lower per 25
capita costs with demonstrated improvements in quality, cost–savings, and better 26
management of chronic illnesses; and 27
WHEREAS, Value–based care models continue to show promising results and 28
expand throughout the rest of the country and in Medicare and Medicaid, with broad 29
support from both public and private stakeholders; and 30
WHEREAS, Hospitals, health care practitioners, and payers should be allowed to 31
voluntarily participate in patient–focused, outcome–driven, value–based reimbursement 32
arrangements in Maryland’s commercial insurance markets that seek to align with 33
value–based programs under Maryland’s Total Cost of Care model and ensure that 34
practitioners have adequate contract protections and that consumers continue to have 35
access to high–quality care that promotes better health outcomes; and 36
HOUSE BILL 1148 3
WHEREAS, Maryland has unique statutory barriers precluding commercial payers 1
from entering into certain value–based care arrangements outside of Maryland’s Total Cost 2
of Care model compared to other states in the nation; and 3
WHEREAS, In Maryland, changes are needed to the health care practitioner bonus 4
and other compensation provisions applicable to the commercial market to allow 5
practitioners to enter into both two–sided incentive and capitation arrangements with 6
commercial plans as they do in other states and the Medicare and Medicaid segments; now, 7
therefore, 8
SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 9
That the Laws of Maryland read as follows: 10
Article – Health Occupations 11
1–302. 12
(d) The provisions of this section do not apply to: 13
(12) Subject to subsection (f) of this section, a health care practitioner who 14
has a compensation arrangement with a health care entity, if the compensation 15
arrangement is funded by or paid under: 16
(i) A Medicare shared savings program accountable care 17
organization authorized under 42 U.S.C. § 1395jjj; 18
(ii) As authorized under 42 U.S.C. § 1315a: 19
1. An advance payment accountable care organization 20
model; 21
2. A pioneer accountable care organization model; or 22
3. A next generation accountable care organization model; 23
(iii) An alternative payment model approved by the federal Centers 24
for Medicare and Medicaid Services; [or] 25
(iv) Another model approved by the federal Centers for Medicare and 26
Medicaid Services that may be applied to health care services provided to both Medicare 27
beneficiaries and individuals who are not Medicare beneficiaries; OR 28
(V) A VALUE–BASED ARRANGEMENT TH AT MEETS THE 29
REQUIREMENTS OF 42 C.F.R. § 411.357(AA)(1) THROUGH (3). 30
Article – Insurance 31
4 HOUSE BILL 1148
4–205. 1
(a) This section does not apply to: 2
(1) the lawful transaction of surplus lines insurance; 3
(2) the lawful transaction of reinsurance by insurers; 4
(3) transactions in the State that involve, and are subsequent to the 5
issuance of, a policy that was lawfully solicited, written, and delivered outside of the State 6
covering only a subject of insurance not resident, located, or expressly to be performed in 7
the State at the time of issuance of the policy; 8
(4) transactions that involve insurance contracts that are independently 9
procured through negotiations occurring entirely outside of the State and that are reported 10
and on which the premium tax is paid in accordance with §§ 4–210 and 4–211 of this 11
subtitle; 12
(5) an attorney while acting in the ordinary relation of attorney and client 13
in the adjustment of claims or losses; [or] 14
(6) unless otherwise determined by the Commissioner, transactions in the 15
State that involve group or blanket insurance or group annuities if the master policy of the 16
group was lawfully issued and delivered in another state in which the person was 17
authorized to engage in insurance business; OR 18
(7) A HEALTH CARE PRACTI TIONER OR SET OF HEA LTH CARE 19
PRACTITIONERS , AS DEFINED IN § 15–113 OF THIS ARTICLE , THAT ACCEPTS 20
CAPITATED PAYMENTS I N ACCORDANCE WITH § 15–2102 OF THIS ARTICLE , BUT 21
PERFORMS NO OTHER AC TS CONSIDERED ACTS O F AN INSURANCE BUSIN ESS. 22
(b) An insurer or other person may not, directly or indirectly, do any of the acts 23
of an insurance business set forth in subsection (c) of this section, except as provided by 24
and in accordance with the specific authorization of statute. 25
(c) Any of the following acts in the State, effected by mail or otherwise, is 26
considered to be doing an insurance business in the State: 27
(1) making or proposing to make, as an insurer, an insurance contract; 28
(2) making or proposing to make, as guarantor or surety insurer, a contract 29
of guaranty or suretyship as a vocation and not merely incidental to another legitimate 30
business or activity of the guarantor or surety insurer; 31
(3) taking or receiving an application for insurance; 32
HOUSE BILL 1148 5
(4) receiving or collecting premiums, commissions, membership fees, 1
assessments, dues, or other consideration for insurance; 2
(5) issuing or delivering an insurance contract to a resident of the State or 3
a person authorized to do business in the State; 4
(6) except as provided in subsection (d) of this section, with respect to a 5
subject of insurance resident, located, or to be performed in the State, directly or indirectly 6
acting as an insurance producer for, or otherwise representing or helping on behalf of 7
another, an insurer or other person to: 8
(i) solicit, negotiate, procure, or effect insurance or the renewal of 9
insurance; 10
(ii) disseminate information about coverage or rates; 11
(iii) forward an application; 12
(iv) deliver a policy or insurance contract; 13
(v) inspect risks; 14
(vi) fix rates; 15
(vii) investigate or adjust claims or losses; 16
(viii) transact matters arising out of an insurance contract after the 17
insurance contract becomes effective; or 18
(ix) in any other manner represent or help an insurer or other person 19
to transact insurance business; 20
(7) doing any kind of insurance business specifically recognized as doing 21
an insurance business under statutes relating to insurance; 22
(8) doing or proposing to do any insurance business that is substantially 23
equivalent to any act listed in this subsection in a manner designed to evade the statutes 24
relating to insurance; or 25
(9) as an insurer transacting any other business in the State. 26
15–113. 27
(a) (1) In this section the following words have the meanings indicated. 28
(2) “Carrier” means: 29
6 HOUSE BILL 1148
(i) an insurer; 1
(ii) a nonprofit health service plan; 2
(iii) a health maintenance organization; 3
(iv) a dental plan organization; or 4
(v) any other person that provides health benefit plans subject to 5
regulation by the State. 6
(3) “ELIGIBLE PROVIDER ” MEANS: 7
(I) A LICENSED PHYSICIAN , AS DEFINED IN § 14–101 OF THE 8
HEALTH OCCUPATIONS ARTICLE, WHO VOLUNTARILY PARTICIPATES IN A 9
TWO–SIDED INCENTIVE ARRA NGEMENT; OR 10
(II) A SET OF HEALTH CARE PRACTITIONERS THAT 11
VOLUNTARILY PARTICIP ATE IN A TWO–SIDED INCENTIVE ARRA NGEMENT. 12
[(3)] (4) “Health care practitioner” means an individual who is licensed, 13
certified, or otherwise authorized under the Health Occupations Article to provide health 14
care services. 15
(5) “SET OF HEALTH CARE PR ACTITIONERS” MEANS: 16
(I) A GROUP PRACTICE ; 17
(II) A CLINICALLY INTEGRA TED ORGANIZATION EST ABLISHED 18
IN ACCORDANCE WITH SUBTITLE 19 OF THIS TITLE; 19
(III) AN ACCOUNTABLE CARE ORGANIZATION ESTABLI SHED IN 20
ACCORDANCE WITH 42 U.S.C. § 1395JJJ AND ANY APPLICAB LE FEDERAL 21
REGULATIONS ; OR 22
(IV) A CLINICALLY INTEGRA TED NETWORK THAT IS A PROVIDER 23
ENTITY THAT MEETS TH E CRITERIA ESTABLISH ED IN GUIDANCE ISSUED B Y THE 24
FEDERAL TRADE COMMISSION, INCLUDING A NETWORK OF BEHAVIORAL HEALTH 25
CARE PROGRAMS LICENS ED UNDER § 7.5–401 OF THE HEALTH – GENERAL ARTICLE. 26
(6) “TWO–SIDED INCENTIVE ARRA NGEMENT” MEANS AN 27
ARRANGEMENT BETWEEN AN ELIGIBLE PROVIDER AND A CARRIER IN WHI CH THE 28
ELIGIBLE PROVIDER MA Y EARN AN INCENTIVE AND A CARRIER MAY RE COUP FUNDS 29
FROM THE ELIGIBLE PR OVIDER IN ACCORDANCE WITH THE TERMS OF A CONTRACT 30 HOUSE BILL 1148 7
ENTERED INTO WITH TH E ELIGIBLE PROVIDER THAT MEETS THE REQUI REMENTS OF 1
THIS SECTION. 2
(b) A carrier may not reimburse a health care practitioner in an amount less than 3
the sum or rate negotiated in the carrier’s provider contract with the health care 4
practitioner. 5
(c) (1) [In this subsection, “set of health care practitioners” means: 6
(i) a group practice; 7
(ii) a clinically integrated organization established in accordance 8
with Subtitle 19 of this title; or 9
(iii) an accountable care organization established in accordance with 10
42 U.S.C. § 1395jjj and any applicable federal regulations. 11
(2)] This section does not prohibit a carrier from: 12
(I) providing bonuses or other incentive–based compensation to a 13
health care practitioner or a set of health care practitioners [if the bonus or other 14
incentive–based compensation:]; OR 15
(II) ENTERING INTO A TWO –SIDED INCENTIVE ARRA NGEMENT 16
WITH AN ELIGIBLE PRO VIDER. 17
(2) A BONUS OR OTHER INCEN TIVE–BASED COMPENSATION 18
PROGRAM OR TWO –SIDED INCENTIVE ARRA NGEMENT AUTHORIZED U NDER THIS 19
SECTION: 20
(i) [does] MAY not create a disincentive to the provision of medically 21
appropriate or medically necessary health care services; and 22
(ii) if the carrier is a health maintenance organization, [complies] 23
SHALL COMPLY with the provisions of § 19–705.1 of the Health – General Article. 24
(3) A bonus or other incentive–based compensation OR TWO–SIDED 25
INCENTIVE ARRANGEMEN T AUTHORIZED under this [subsection] SECTION: 26
(i) if applicable, shall promote HEALTH EQUITY , IMPROVEMENT 27
OF HEALTH CARE OUTCO MES, AND the provision of preventive health care services; or 28
(ii) may reward a health care practitioner [or], a set of health care 29
practitioners, OR AN ELIGIBLE PROVI DER, based on satisfaction of performance 30 8 HOUSE BILL 1148
measures, if the following is agreed on in writing by the carrier and the health care 1
practitioner [or], set of health care practitioners, OR ELIGIBLE PROVIDER : 2
1. the performance measures, INCLUDING THE SOURCE OF 3
THE MEASURES ; 4
2. the method AND THE TIME PERIOD for calculating 5
whether the performance measures have been satisfied; [and] 6
3. the method by which the health care practitioner [or], set 7
of health care practitioners, OR ELIGIBLE PROVIDER may request reconsideration of the 8
calculations by the carrier; AND 9
4. IF APPLICABLE , THE RISK–ADJUSTMENT METHOD 10
USED. 11
(4) Acceptance of a bonus or other incentive–based compensation OR 12
TWO–SIDED INCENTIVE ARRA NGEMENT under this subsection shall be voluntary. 13
(5) A CARRIER MAY NOT REDU CE THE FEE SCHEDULE OF A HEALTH 14
CARE PRACTITIONER , OR A SET OF HEALTH CARE PRACTITIONERS , OR AN ELIGIBLE 15
PROVIDER SOLELY BECAUSE THE HEALTH C ARE PRACTITIONER , OR SET OF HEALTH 16
CARE PRACTITIONERS , OR ELIGIBLE PROVIDER DOES NOT PARTICIPATE IN THE 17
CARRIER’S BONUS OR OTHER INC ENTIVE–BASED COMPENSATION O R TWO–SIDED 18
INCENTIVE ARRANGEMEN T PROGRAM. 19
(6) PARTICIPATION IN A TW O–SIDED INCENTIVE ARRA NGEMENT MAY 20
NOT BE THE SOLE OPPO RTUNITY FOR A HEALTH CARE PRACTITIONER OR A SET OF 21
HEALTH CARE PRACTITI ONERS TO BE ELIGIBLE TO RECEIVE INCREASES IN 22
REIMBURSEMENT . 23
[(5)] (6) (7) A carrier may not require [a health care practitioner or a set of 24
health care practitioners to participate in the carrier’s bonus or incentive–based 25
compensation program] as a condition of participation in the carrier’s provider network: 26
(I) A HEALTH CARE PRACTI TIONER OR SET OF HE ALTH CARE 27
PRACTITIONERS TO PAR TICIPATE IN THE CARR IER’S BONUS OR OTHER 28
INCENTIVE–BASED COMPENSATION P ROGRAM; OR 29
(II) AN ELIGIBLE PROVIDER TO PARTICIPATE IN TH E CARRIER’S 30
TWO–SIDED INCENTIVE ARRA NGEMENT PROGRAM . 31
[(6)] (7) (8) A health care practitioner, a set of health care practitioners, AN 32
ELIGIBLE PROVIDER , a health care practitioner’s designee, [or] a designee of a set of 33 HOUSE BILL 1148 9
health care practitioners, OR A DESIGNEE OF AN ELIGIBLE PROVIDER may file a 1
complaint with the Administration regarding a violation of this subsection. 2
(d) (1) A carrier shall provide a health care practitioner, A SET OF HEALTH 3
CARE PRACTITIONERS , OR AN ELIGIBLE PROVI DER with a copy of: 4
(i) a schedule of ALL applicable fees [for up to] OR the [fifty] 50 5
most common services billed by a health care practitioner in that specialty, WHICHEVER 6
IS LESS; 7
(ii) a description of the coding guidelines used by the carrier that are 8
applicable to the services billed by a health care practitioner in that specialty; [and] 9
(iii) the information about the practitioner and the methodology that 10
the carrier uses to determine whether to: 11
1. increase or reduce the practitioner’s level of 12
reimbursement; [and] 13
2. provide a bonus or other incentive–based compensation to 14
the practitioner; AND 15
3. RECOUP COMPENSATION FROM AN ELIGIBLE 16
PROVIDER UNDER A TWO –SIDED INCENTIVE ARRA NGEMENT; AND 17
(IV) A SUMMARY OF THE TER MS OF A TWO –SIDED INCENTIVE 18
ARRANGEMENT PROGRAM . 19
(2) Except as provided in paragraph (4) of this subsection, a carrier shall 20
provide the information required under paragraph (1) of this subsection in the manner 21
indicated in each of the following instances: 22
(i) in writing [at the time of] BEFORE A contract execution; 23
(ii) in writing or electronically 30 days [prior to] BEFORE a change; 24
and 25
(iii) in writing or electronically [upon] ON request of the health care 26
practitioner, SET OF HEALTH CARE P RACTITIONERS , OR ELIGIBLE PROVIDER . 27
(3) Except as provided in paragraph (4) of this subsection, a carrier shall 28
make the pharmaceutical formulary that the carrier uses available to a health care 29
practitioner, A SET OF HEALTH CARE PRACTITIONERS , OR AN ELIGIBLE PROVI DER 30
electronically. 31
10 HOUSE BILL 1148
(4) On written request of a health care practitioner, A SET OF HEALTH 1
CARE PRACTITI ONERS, OR AN ELIGIBLE PROVI DER, a carrier shall provide the 2
information required under paragraphs (1) and (3) of this subsection in writing. 3
(5) The Administration may adopt regulations to carry out the provisions 4
of this subsection. 5
(e) (1) A carrier that compensates health care practitioners OR A SET OF 6
HEALTH CARE PRACTITI ONERS wholly or partly on a capitated basis IN ACCORDANCE 7
WITH § 15–2102 OF THIS ARTICLE may not retain any capitated fee attributable to an 8
enrollee or covered person during an enrollee’s or covered person’s contract year. 9
(2) A carrier is in compliance with paragraph (1) of this subsection if, 10
within 45 days after an enrollee or covered person chooses or obtains health care from a 11
health care practitioner OR A SET OF HEALTH C ARE PRACTITIONERS , the carrier pays 12
to the health care practitioner OR SET OF HEALTH CAR E PRACTITIONERS all accrued but 13
unpaid capitated fees attributable to that enrollee or person that the health care 14
practitioner OR SET OF HEALTH CAR E PRACTITIONERS would have received had the 15
enrollee or person chosen the health care practitioner OR SET OF HEALTH CAR E 16
PRACTITIONERS at the beginning of the enrollee’s or covered person’s contract year. 17
(3) ACCEPTANCE OF A CAPIT ATED PAYMENT SHALL B E VOLUNTARY . 18
(F) (1) UNDER A TWO–SIDED INCENTIVE ARRA NGEMENT THAT COMPLIE S 19
WITH THE REQUIREMENT S OF THIS SECTION, A CARRIER MAY RECOUP FUNDS PAID 20
TO AN ELIGIBLE PROVI DER BASED ON THE TER MS OF A WRITTEN CONT RACT 21
BETWEEN THE CARRIER AND THE ELIGIBLE PRO VIDER THAT AT A MINI MUM: 22
(I) ESTABLISH A TARGET B UDGET FOR: 23
1. THE TOTAL COST OF CA RE OF A POPULATION O F 24
PATIENTS ADJUSTED FO R RISK AND POPULATIO N SIZE; OR 25
2. THE COST OF AN EPISO DE OF CARE; 26
(II) LIMIT RECOUPMENT TO NOT MORE THAN 50% OF THE 27
EXCESS ABOVE THE MUTUALLY AGREED ON T ARGET ESTABLISHED IN ACCORDANCE 28
WITH ITEM (I) OF THIS PARAGRAPH ; 29
(III) SPECIFY A MUTUALLY A GREED ON MAXIMUM LIA BILITY FOR 30
TOTAL RECOUPMENT THA T MAY NOT EXCEED 10% OF THE ANNUAL PAYMEN TS FROM 31
THE CARRIER TO THE E LIGIBLE PROVIDER ; 32
HOUSE BILL 1148 11
(IV) PROVIDE AN OPPORTUNI TY FOR GAINS BY AN E LIGIBLE 1
PROVIDER THAT IS GRE ATER THAN THE OPPORT UNITY FOR RECOUPMENT BY THE 2
CARRIER; 3
(V) FOLLOWING GOOD FAITH NEGOTIATIONS , PROVIDE AN 4
OPPORTUNITY FOR AN A UDIT BY AN INDEPENDE NT THIRD PARTY AND A N 5
INDEPENDENT THIRD–PARTY DISPUTE RESOLU TION PROCESS; 6
(VI) REQUIRE THE CARRIER AND THE ELIGIBLE PRO VIDER TO 7
NEGOTIATE IN GOOD FA ITH ADJUSTMENTS TO T HE TARGET BUDGET WHE N: 8
1. CERTAIN CIRCUMSTANCE S BEYOND THE CONTROL OF 9
THE CARRIER OR THE E LIGIBLE PROVIDER A RISE, INCLUDING CHANGES IN 10
HOSPITAL RATES ; AND 11
2. MATERIAL CHANGES OCC UR IN HEALTH CARE 12
ECONOMICS, HEALTH CARE DELIVERY , OR REGULATIONS THAT IMPACT THE 13
ARRANGEMENT ; AND 14
(VII) REQUIRE THE CARRIER TO PAY ANY INCENTIVE TO OR 15
REQUEST ANY RECOUPME NT FROM THE ELIGIBLE PROV IDER WITHIN 6 MONTHS 16
AFTER THE END OF THE CONTRACT YEAR , UNLESS THE CARRIER O R ELIGIBLE 17
PROVIDER INITIATES A DISPUTE RELATING TO THE RECOUPMENT OR IN CENTIVE 18
AMOUNT. 19
(2) UNLESS MUTUALLY AGREE D TO BY AN ELIGIBLE PROVIDER AND A 20
CARRIER, AN ARRANGEMENT ENTER ED INTO UNDER THIS S UBSECTION MAY NOT 21
PROVIDE AN OPPORTUNI TY FOR RECOUPMENT BY THE CARRIER BASED ON THE 22
ELIGIBLE PROVIDER ’S PERFORMANCE DURING THE FIRST 12 MONTHS OF THE 23
ARRANGEMENT . 24
(3) A CARRIER THAT ENTERS INTO A TWO –SIDED INCENTIVE 25
ARRANGEMENT WITH AN ELIGIBLE PROVIDER IN WHICH THE AMOUNT OF ANY 26
PAYMENT IS DETERMINE D, IN WHOLE OR IN PART , ON THE TOTAL COST OF CARE OF 27
A POPULATION OF PATI ENTS OR AN EPISODE O F CARE, SHALL, AT LEAST 28
QUARTERLY , DISCLOSE TO THE ELIG IBLE PROVIDER THE FOLLOWING INF ORMATION 29
IN A MANNER THAT MEE TS FEDERAL AND STATE DATA USE AND PR IVACY 30
STANDARDS: 31
(I) ANY AMOUNT PAID TO A NOTHER HEALTH CARE P ROVIDER 32
THAT IS INCLUDED IN THE TOTAL COST OF CA RE OF A PATIENT IN T HE POPULATION 33
OR EPISODE OF CARE ; AND 34
12 HOUSE BILL 1148
(II) ANY COPAYMENT , COINSURANCE , OR DEDUCTIBLE THAT I S 1
INCLUDED IN THE TOTA L COST OF CARE OF A PATIENT IN THE POPUL ATION OR 2
EPISODE OF CARE . 3
(4) UNLESS MUTUALLY AGREE D TO BY THE CARRIER AND ELIGIBLE 4
PROVIDER, A TWO–SIDED INCENTIVE ARRA NGEMENT MAY NOT BE A MENDED 5
DURING THE TERM OF T HE CONTRACT . 6
(5) THE OPPORTUNITY FOR I NDEPENDENT THIRD –PARTY DISPUTE 7
RESOLUTION PROVIDED FOR IN PARAGRAPH (1)(V) OF THIS SUBSECTION MAY NOT 8
BE REQUIRED TO BE EX HAUSTED BEFORE A MEM BER OR MEMBER ’S 9
REPRESENTATIVE IS AL LOWED TO FILE AN APP EAL OF A COVERAGE DE CISION 10
UNDER § 15–10D–02 OF THIS TITLE. 11
(6) NOTHING IN THIS SUBSE CTION MAY BE CONSTRU ED TO: 12
(I) ALTER ANY RE QUIREMENT FOR A CARR IER TO PAY A 13
HOSPITAL OR RELATED INSTITUTION THE RATE APPROVED BY THE HEALTH 14
SERVICES COST REVIEW COMMISSION FOR HOSPIT AL SERVICES; OR 15
(II) SUPERSEDE THE HEALTH SERVICES COST REVIEW 16
COMMISSION’S JURISDICTION OR AU THORITY OVER RATE REVIEW AND APPROVAL 17
FOR HOSPITAL SERVICE S. 18
15–1008. 19
(b) This section does not apply to an adjustment to reimbursement: 20
(1) made as part of an annual contracted reconciliation of a risk sharing 21
arrangement under an administrative service provider contract; OR 22
(2) MADE AS PART OF A TW O–SIDED INCENTIVE ARRA NGEMENT THAT 23
COMPLIES WITH § 15–113 OF THIS TITLE. 24
(c) (1) If a carrier retroactively denies reimbursement to a health care 25
provider, the carrier: 26
(i) may only retroactively deny reimbursement for services subject 27
to coordination of benefits with another carrier, the Maryland Medical Assistance Program, 28
or the Medicare Program during the 18–month period after the date that the carrier paid 29
the health care provider; and 30
(ii) except as provided in item (i) of this paragraph, may only 31
retroactively deny reimbursement during the 6–month period after the date that the carrier 32
paid the health care provider. 33 HOUSE BILL 1148 13
(2) (i) A carrier that retroactively denies reimbursement to a health 1
care provider under paragraph (1) of this subsection shall provide the health care provider 2
with a written statement specifying the basis for the retroactive denial. 3
(ii) If the retroactive denial of reimbursement results from 4
coordination of benefits, the written statement shall provide the name and address of the 5
entity acknowledging responsibility for payment of the denied claim. 6
SUBTITLE 21. CAPITATED PAYMENTS. 7
15–2101. 8
(A) IN THIS SUBTITLE THE FOLLOWING WORDS HAVE THE MEANINGS 9
INDICATED. 10
(B) “ADMINISTRATOR ” MEANS A CARRIER ADMINI STERING A SELF–FUNDED 11
GROUP HEALTH PLAN . 12
(C) “CARRIER” HAS THE MEANING STAT ED IN § 15–113 OF THIS TITLE. 13
(D) “HEALTH BENEFIT PLAN ” HAS THE MEANING STAT ED IN § 2–112.2 OF 14
THIS ARTICLE. 15
(D) (E) “HEALTH CARE PRACTITIO NER” HAS THE MEANING STAT ED IN § 16
15–113 OF THIS TITLE. 17
(E) (F) “MEMBER” HAS THE MEANING STAT ED IN § 15–10A–01 OF THIS 18
TITLE. 19
(F) (G) “NETWORK” HAS THE MEANING STAT ED IN § 15–112 OF THIS 20
TITLE. 21
(G) (H) “SET OF HEALTH CARE PRACTITIONERS ” HAS THE MEANING 22
STATED IN § 15–113 OF THIS TITLE. 23
(H) (I) “PARTICIPANT” MEANS AN EMPLOYEE OR AN EMPLOYEE ’S 24
DEPENDENT WHO PARTIC IPATES IN A SELF–FUNDED GROUP HEALTH INSURANCE 25
PLAN. 26
15–2102. 27
(A) THIS SECTION APPLIES TO ARRANGEMENTS UNDE R AN INSURED A 28
HEALTH BENEFIT PLAN OFFERED BY A CARRIER OR A SELF–FUNDED GROUP HEALTH 29
INSURANCE PLAN IN WH ICH A CAPITATED PAYM ENT IS: 30 14 HOUSE BILL 1148
(1) CALCULATED AS A FIXE D AMOUNT PER MEMBER OR PARTICIPANT 1
ASSIGNED OR ATTRIBU TED TO THE HEALTH CA RE PRACTITIONER OR S ET OF HEALTH 2
CARE PRACTITIONERS ; 3
(2) TO COVER THE PROVISI ON OF A SET OF SERVI CES DEFINED IN THE 4
HEALTH CARE PRACTITI ONER’S OR SET OF HEALTH C ARE PRACTITIONERS ’ 5
CONTRACT AND RENDERE D BY THE HEALTH CARE PRACTITIONER OR SET OF 6
HEALTH CARE PRACTITI ONERS; AND 7
(3) PAID PERIODICALLY RE GARDLESS OF UTILIZAT ION OF THE 8
SERVICES BY THE MEMB ERS OR PARTICIPANTS . 9
(B) SUBJECT TO THE REQUIR EMENTS OF SUBSECTION (C) OF THIS SECTION, 10
A HEALTH CARE PRACTI TIONER OR SET OF HEA LTH CARE PRACTITIONERS IS NOT 11
ENGAGED IN INSURANCE BUSINESS AS DESCRIBE D IN § 4–205 OF THIS ARTICLE 12
SOLELY BECAUSE THE H EALTH CARE PRACTITIO NER OR SET OF HEALTH CARE 13
PRACTITIONERS ENTERS INTO A CONTRACT WITH A CARRIER THAT INCLU DES 14
CAPITATED PAYMENTS F OR SERVICE S PROVIDED BY THE HE ALTH CARE 15
PRACTITIONER OR SET OF HEALTH CARE PRACT ITIONERS. 16
(C) A HEALTH CARE PRACTITI ONER OR SET OF HEALT H CARE 17
PRACTITIONERS IS NOT ENGAGED IN INSURANCE BUSINESS AS DESCRIBE D IN § 18
4–205(C) OF THIS ARTICLE SOLE LY BECAUSE THE HEALT H CARE PRACTITIONER OR 19
SET OF HEALTH CARE P RACTITIONERS ENTERS INTO A CONTRACT WITH AN 20
ADMINISTRATOR THAT I NCLUDES CAPITATED PA YMENTS FOR SERVICES PROVIDED 21
BY THE HEALTH CARE P RACTITIONER OR SET O F HEALTH CARE PRACTI TIONERS TO 22
MEMBERS OF A SELF –FUNDED GROUP HEALTH PLAN IF : 23
(1) THE HEALTH CARE PRAC TITIONER OR SET OF H EALTH CARE 24
PRACTITIONERS PARTIC IPATES IN THE ADMINI STRATOR’S NETWORK AND ACCEPT S 25
CAPITATED PAYMENTS ; 26
(2) THE SELF –FUNDED GROUP HEALTH PLAN RETAINS THE 27
OBLIGATION TO PROVID E ACCESS TO COVERED HEALTH CARE BENEFITS TO 28
PARTICIPANTS; AND 29
(3) THE CONTRACT DOES NO T INCLUDE OTHER REIM BURSEMENT 30
ARRANGEMENTS THAT AR E CONSIDERED ACTS OF AN INSURANCE BUSINES S UNDER 31
§ 4–205(C) OF THIS ARTICLE. 32
(D) NOTWITHSTANDING SUBSE CTIONS (B) AND (C) OF THIS SECTI ON, 33
NOTHING IN THIS SECT ION MAY BE CONSTRUED TO: 34
HOUSE BILL 1148 15
(1) ALTER ANY REQUIREMEN T FOR A CARRIER OR S ELF–FUNDED 1
GROUP HEALTH PLAN TO PAY A HOSPITAL OR RE LATED INSTITUTION TH E RATE 2
APPROVED BY THE HEALTH SERVICES COST REVIEW COMMISSION FOR HOSPIT AL 3
SERVICES; OR 4
(2) SUPERSEDE THE HEALTH SERVICES COST REVIEW 5
COMMISSION’S JURISDICTION OR AU THORITY OVER RATE RE VIEW AND APPROVAL 6
FOR HOSPITAL SERVICE S. 7
SECTION 2. AND BE IT FURTHER ENACTED, That, on or before December 31, 8
2023, and annually thereafter until December 31, 2032, the Maryland Health Care 9
Commission shall aggregate the following information and report it to the Senate Finance 10
Committee and the House Health and Government Operations Committee, in accordance 11
with § 2–1257 of the State Government Article: 12
(1) the number and type of value–based arrangements entered into in 13
accordance with the authority established under Section 1 of this Act; 14
(2) quality outcomes of the value–based arrangements; 15
(3) the number of complaints made regarding value–based arrangements; 16
and 17
(4) the cost–effectiveness of the value–based arrangements; and 18
(5) the impact of two–sided incentive arrangements on the fee schedules of 19
health care practitioners included in the target budget that are not eligible providers. 20
SECTION 3. AND BE IT FURTHER ENACTED, That this Act shall take effect 21
October 1, 2022. 22
Approved:
________________________________________________________________________________
Governor.
________________________________________________________________________________
Speaker of the House of Delegates.
________________________________________________________________________________
President of the Senate.