2025 -- H 5172
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LC000724
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S T A T E O F R H O D E I S L A N D
IN GENERAL ASSEMBLY
JANUARY SESSION, A.D. 2025
____________
A N A C T
RELATING TO INSURANCE -- THE TRANSPARENCY AND ACCOUNTABILITY IN
ARTIFICIAL INTELLIGENCE USE BY HEALTH INSURERS TO MANAGE COV ERAGE
AND CLAIMS ACT
Introduced By: Representatives Donovan, Speakman, Potter, Bennett, Giraldo, Stewart,
Fogarty, Handy, McGaw, and Morales
Date Introduced: January 24, 2025
Referred To: House Health & Human Services
It is enacted by the General Assembly as follows:
SECTION 1. Title 27 of the General Laws entitled "INSURANCE" is hereby amended by 1
adding thereto the following chapter: 2
CHAPTER 83 3
THE TRANSPARENCY AND ACCOUNTABI LITY IN ARTIFICIAL INTELLIGENCE USE 4
BY HEALTH INSURERS TO MANAGE COVERAGE AND CLAIMS ACT 5
27-83-1. Short title and purpose. 6
(a) This chapter shall be known and may be cited as "The Transparency and Accountability 7
in Artificial Intelligence Use by Health Insurers to Manage Coverage and Claims Act." 8
(b) The purpose of this chapter is to regulate the use of artificial intelligence (AI) by health 9
insurers to ensure transparency, accountability and compliance with state and federal requirements 10
for claims and coverage management including anti-discrimination and privacy laws. 11
27-83-2. Definitions. 12
As used in this chapter, the following terms shall have the following meanings, unless the 13
context clearly indicates otherwise: 14
(1) "Adverse determination" means any of the following: a denial, reduction, or termination 15
of, or a failure to provide or make payment (in whole or in part) for, a benefit, including any such 16
denial, reduction, termination, or failure to provide or make payment that is based on a 17
determination of an individual’s eligibility to participate in a plan or to receive coverage under a 18
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plan, and including, with respect to group health plans, a denial, reduction, or termination of, or a 1
failure to provide or make payment (in whole or in part) for, a benefit resulting from the application 2
of any utilization review, as well as a failure to cover an item or service for which benefits are 3
otherwise provided as a result of a determination that the item or service is experimental or 4
investigational or not medically necessary or appropriate. The term also includes a rescission of 5
coverage determination. 6
(2) "Artificial intelligence" or "AI" means a machine-based system that undertakes 7
analysis, reasoning and problem-solving, and that can be used to generate predictions, 8
recommendations, or other content. 9
(3) "Enrollee" means an individual who has health insurance coverage through an insurer. 10
(4) "Insurer" means all insurance companies licensed to do business in Rhode Island, 11
including those subject to chapter 1 of title 27, a foreign insurance company licensed to do business 12
in Rhode Island and subject to chapter 2 of title 27, a health insurance carrier subject to and 13
organized pursuant to chapter 18 of title 27, a nonprofit hospital service corporation subject to and 14
organized pursuant to chapter 19 of title 27, a nonprofit medical services corporation subject to and 15
organized pursuant to chapter 20 of title 27, a qualified health maintenance organization subject to 16
and organized pursuant to chapter 41 of title 27, and Medicaid managed care organizations as 17
described in §42-7.4-2. 18
(5) "Medically necessary care" means a medical, surgical, or other service required for the 19
prevention, diagnosis, cure, or treatment of a health-related condition including any such services 20
that are necessary to prevent or slow a decremental change in either medical or mental health status. 21
(6) "Third party" means an individual or entity, including independent contractors, 22
pharmacy benefit managers and group purchasing organizations, that provides to an insurer 23
services, including software development, data collection, analysis and administrative or other 24
resources that manage or assist in managing enrollee healthcare coverage and claims. 25
27-83-3. Requirements. 26
(a) Transparency. 27
(1) Insurers shall publicly disclose how they use AI to manage claims and coverage, 28
including underlying algorithms, data used, and resulting determinations. 29
(2) Insurers shall submit to the office of the health insurance commissioner and the 30
executive office of health and human services, upon request, all information, including documents 31
and software, that permits enforcement of this chapter. 32
(3) Insurers shall maintain documentation of AI decisions for at least five (5) years. 33
(4) Insurers shall provide notice to enrollees and healthcare providers when AI has been 34
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used to issue an adverse determination and provide a clear and timely process for appealing the 1
determination. 2
(b) Accountability. 3
(1) Insurers shall not rely exclusively on AI or automated decision tools to deny, reduce, 4
or alter coverage or claims for medically necessary care. 5
(2) Adverse determinations shall be reviewed by physicians or other licensed healthcare 6
professionals who are qualified in the appropriate specialties, without conflicts of interest or 7
incentives to confirm adverse determinations, and who have the authority to reverse adverse 8
determinations based on their clinical judgment. 9
(3) Insurers shall conduct on-going monitoring, audits and oversight of all employees and 10
third parties using AI on their behalf to manage enrollee coverage or claims, including taking 11
actions to ensure: 12
(i) Enrollee medically necessary care has not been delayed, denied or limited; 13
(ii) Financial and administrative burdens on enrollees and healthcare providers are 14
reasonable and minimized; 15
(iii) Private enrollee health information is protected as required under state and federal 16
privacy laws; and 17
(iv) AI use does not violate enrollee rights under state and federal laws prohibiting 18
discrimination, including those based on age, race, sex, sexual orientation, and pre-existing 19
conditions. 20
27-83-4. Enforcement. 21
(a) The office of the health insurance commissioner and the executive office of health and 22
human services, in collaboration with other state authorities including the department of business 23
regulation, the secretary of state, and the attorney general, are authorized to promulgate such rules 24
and regulations, and take such actions as may be necessary, to implement and enforce the provisions 25
of this chapter. 26
(b) Nothing in this chapter shall limit them from taking independent actions permitted 27
under any state or federal law, including, but not limited to, consumer protection laws related to 28
antitrust, and deceptive trade practices as described in chapter 13.1 of title 6 ("deceptive trade 29
practices"). 30
(c) Enrollees have a private right of action to enforce the provisions of this chapter. 31
(d) Violations of this chapter may result in: 32
(1) Orders to change or limit how insurers use AI for management of enrollee coverage 33
and claims; 34
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(2) Fines of up to fifty thousand dollars ($50,000) per violation; 1
(3) Revocation or suspension of the insurer’s licenses in Rhode Island; and 2
(4) Compensation and damages to affected enrollees and health care providers, including 3
pharmacies and hospitals. 4
27-83-5. Application. 5
This chapter supplements requirements set forth in other general laws. To the extent there 6
is any direct conflict, the provisions of this chapter shall control over any more general provisions. 7
27-83-6. Severability. 8
If any provision of this chapter is found unconstitutional, preempted, or otherwise invalid, 9
that provision shall be severed, and such decision shall not affect the validity of the remaining 10
provisions of this chapter. 11
SECTION 2. Section 42-7.2-5 of the General Laws in Chapter 42-7.2 entitled "Office of 12
Health and Human Services" is hereby amended to read as follows: 13
42-7.2-5. Duties of the secretary. 14
The secretary shall be subject to the direction and supervision of the governor for the 15
oversight, coordination, and cohesive direction of state-administered health and human services 16
and in ensuring the laws are faithfully executed, notwithstanding any law to the contrary. In this 17
capacity, the secretary of the executive office of health and human services (EOHHS) shall be 18
authorized to: 19
(1) Coordinate the administration and financing of healthcare benefits, human services, and 20
programs including those authorized by the state’s Medicaid section 1115 demonstration waiver 21
and, as applicable, the Medicaid state plan under Title XIX of the U.S. Social Security Act. 22
However, nothing in this section shall be construed as transferring to the secretary the powers, 23
duties, or functions conferred upon the departments by Rhode Island public and general laws for 24
the administration of federal/state programs financed in whole or in part with Medicaid funds or 25
the administrative responsibility for the preparation and submission of any state plans, state plan 26
amendments, or authorized federal waiver applications, once approved by the secretary. 27
(2) Serve as the governor’s chief advisor and liaison to federal policymakers on Medicaid 28
reform issues as well as the principal point of contact in the state on any such related matters. 29
(3)(i) Review and ensure the coordination of the state’s Medicaid section 1115 30
demonstration waiver requests and renewals as well as any initiatives and proposals requiring 31
amendments to the Medicaid state plan or formal amendment changes, as described in the special 32
terms and conditions of the state’s Medicaid section 1115 demonstration waiver with the potential 33
to affect the scope, amount, or duration of publicly funded healthcare services, provider payments 34
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or reimbursements, or access to or the availability of benefits and services as provided by Rhode 1
Island general and public laws. The secretary shall consider whether any such changes are legally 2
and fiscally sound and consistent with the state’s policy and budget priorities. The secretary shall 3
also assess whether a proposed change is capable of obtaining the necessary approvals from federal 4
officials and achieving the expected positive consumer outcomes. Department directors shall, 5
within the timelines specified, provide any information and resources the secretary deems necessary 6
in order to perform the reviews authorized in this section. 7
(ii) Direct the development and implementation of any Medicaid policies, procedures, or 8
systems that may be required to assure successful operation of the state’s health and human services 9
integrated eligibility system and coordination with HealthSource RI, the state’s health insurance 10
marketplace. 11
(iii) Beginning in 2015, conduct on a biennial basis a comprehensive review of the 12
Medicaid eligibility criteria for one or more of the populations covered under the state plan or a 13
waiver to ensure consistency with federal and state laws and policies, coordinate and align systems, 14
and identify areas for improving quality assurance, fair and equitable access to services, and 15
opportunities for additional financial participation. 16
(iv) Implement service organization and delivery reforms that facilitate service integration, 17
increase value, and improve quality and health outcomes. 18
(4) Beginning in 2020, prepare and submit to the governor, the chairpersons of the house 19
and senate finance committees, the caseload estimating conference, and to the joint legislative 20
committee for health-care oversight, by no later than September 15 of each year, a comprehensive 21
overview of all Medicaid expenditures outcomes, administrative costs, and utilization rates. The 22
overview shall include, but not be limited to, the following information: 23
(i) Expenditures under Titles XIX and XXI of the Social Security Act, as amended; 24
(ii) Expenditures, outcomes, and utilization rates by population and sub-population served 25
(e.g., families with children, persons with disabilities, children in foster care, children receiving 26
adoption assistance, adults ages nineteen (19) to sixty-four (64), and elders); 27
(iii) Expenditures, outcomes, and utilization rates by each state department or other 28
municipal or public entity receiving federal reimbursement under Titles XIX and XXI of the Social 29
Security Act, as amended; 30
(iv) Expenditures, outcomes, and utilization rates by type of service and/or service 31
provider; 32
(v) Expenditures by mandatory population receiving mandatory services and, reported 33
separately, optional services, as well as optional populations receiving mandatory services and, 34
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reported separately, optional services for each state agency receiving Title XIX and XXI funds; and 1
(vi) Information submitted to the Centers for Medicare & Medicaid Services for the 2
mandatory annual state reporting of the Core Set of Children’s Health Care Quality Measures for 3
Medicaid and Children’s Health Insurance Program, behavioral health measures on the Core Set of 4
Adult Health Care Quality Measures for Medicaid and the Core Sets of Health Home Quality 5
Measures for Medicaid to ensure compliance with the Bipartisan Budget Act of 2018, Pub. L. No. 6
115-123. 7
The directors of the departments, as well as local governments and school departments, 8
shall assist and cooperate with the secretary in fulfilling this responsibility by providing whatever 9
resources, information and support shall be necessary. 10
(5) Resolve administrative, jurisdictional, operational, program, or policy conflicts among 11
departments and their executive staffs and make necessary recommendations to the governor. 12
(6) Ensure continued progress toward improving the quality, the economy, the 13
accountability, and the efficiency of state-administered health and human services. In this capacity, 14
the secretary shall: 15
(i) Direct implementation of reforms in the human resources practices of the executive 16
office and the departments that streamline and upgrade services, achieve greater economies of scale 17
and establish the coordinated system of the staff education, cross-training, and career development 18
services necessary to recruit and retain a highly-skilled, responsive, and engaged health and human 19
services workforce; 20
(ii) Encourage EOHHS-wide consumer-centered approaches to service design and delivery 21
that expand their capacity to respond efficiently and responsibly to the diverse and changing needs 22
of the people and communities they serve; 23
(iii) Develop all opportunities to maximize resources by leveraging the state’s purchasing 24
power, centralizing fiscal service functions related to budget, finance, and procurement, 25
centralizing communication, policy analysis and planning, and information systems and data 26
management, pursuing alternative funding sources through grants, awards, and partnerships and 27
securing all available federal financial participation for programs and services provided EOHHS-28
wide; 29
(iv) Improve the coordination and efficiency of health and human services legal functions 30
by centralizing adjudicative and legal services and overseeing their timely and judicious 31
administration; 32
(v) Facilitate the rebalancing of the long-term system by creating an assessment and 33
coordination organization or unit for the expressed purpose of developing and implementing 34
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procedures EOHHS-wide that ensure that the appropriate publicly funded health services are 1
provided at the right time and in the most appropriate and least restrictive setting; 2
(vi) Strengthen health and human services program integrity, quality control and 3
collections, and recovery activities by consolidating functions within the office in a single unit that 4
ensures all affected parties pay their fair share of the cost of services and are aware of alternative 5
financing; 6
(vii) Assure protective services are available to vulnerable elders and adults with 7
developmental and other disabilities by reorganizing existing services, establishing new services 8
where gaps exist, and centralizing administrative responsibility for oversight of all related 9
initiatives and programs. 10
(7) Prepare and integrate comprehensive budgets for the health and human services 11
departments and any other functions and duties assigned to the office. The budgets shall be 12
submitted to the state budget office by the secretary, for consideration by the governor, on behalf 13
of the state’s health and human services agencies in accordance with the provisions set forth in § 14
35-3-4. 15
(8) Utilize objective data to evaluate health and human services policy goals, resource use 16
and outcome evaluation and to perform short and long-term policy planning and development. 17
(9) Establishment of an integrated approach to interdepartmental information and data 18
management that complements and furthers the goals of the unified health infrastructure project 19
initiative and that will facilitate the transition to a consumer-centered integrated system of state-20
administered health and human services. 21
(10) At the direction of the governor or the general assembly, conduct independent reviews 22
of state-administered health and human services programs, policies and related agency actions and 23
activities and assist the department directors in identifying strategies to address any issues or areas 24
of concern that may emerge thereof. The department directors shall provide any information and 25
assistance deemed necessary by the secretary when undertaking such independent reviews. 26
(11) Provide regular and timely reports to the governor and make recommendations with 27
respect to the state’s health and human services agenda. 28
(12) Employ such personnel and contract for such consulting services as may be required 29
to perform the powers and duties lawfully conferred upon the secretary. 30
(13) Assume responsibility for complying with the provisions of any general or public law 31
or regulation related to the disclosure, confidentiality, and privacy of any information or records, 32
in the possession or under the control of the executive office or the departments assigned to the 33
executive office, that may be developed or acquired or transferred at the direction of the governor 34
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or the secretary for purposes directly connected with the secretary’s duties set forth herein. 1
(14) Hold the director of each health and human services department accountable for their 2
administrative, fiscal, and program actions in the conduct of the respective powers and duties of 3
their agencies. 4
(15) Identify opportunities for inclusion with the EOHHS’ October 1, 2023 budget 5
submission, to remove fixed eligibility thresholds for programs under its purview by establishing 6
sliding scale decreases in benefits commensurate with income increases up to four hundred fifty 7
percent (450%) of the federal poverty level. These shall include but not be limited to, medical 8
assistance, childcare assistance, and food assistance. 9
(16) Enforce the provisions of title 27 as set forth in § 27-83-1 through § 27-83-6. 10
SECTION 3. Section 42-14.5-3 of the General Laws in Chapter 42-14.5 entitled "The 11
Rhode Island Health Care Reform Act of 2004 — Health Insurance Oversight" is hereby amended 12
to read as follows: 13
42-14.5-3. Powers and duties. 14
The health insurance commissioner shall have the following powers and duties: 15
(a) To conduct quarterly public meetings throughout the state, separate and distinct from 16
rate hearings pursuant to § 42-62-13, regarding the rates, services, and operations of insurers 17
licensed to provide health insurance in the state; the effects of such rates, services, and operations 18
on consumers, medical care providers, patients, and the market environment in which the insurers 19
operate; and efforts to bring new health insurers into the Rhode Island market. Notice of not less 20
than ten (10) days of the hearing(s) shall go to the general assembly, the governor, the Rhode Island 21
Medical Society, the Hospital Association of Rhode Island, the director of health, the attorney 22
general, and the chambers of commerce. Public notice shall be posted on the department’s website 23
and given in the newspaper of general circulation, and to any entity in writing requesting notice. 24
(b) To make recommendations to the governor and the house of representatives and senate 25
finance committees regarding healthcare insurance and the regulations, rates, services, 26
administrative expenses, reserve requirements, and operations of insurers providing health 27
insurance in the state, and to prepare or comment on, upon the request of the governor or 28
chairpersons of the house or senate finance committees, draft legislation to improve the regulation 29
of health insurance. In making the recommendations, the commissioner shall recognize that it is 30
the intent of the legislature that the maximum disclosure be provided regarding the reasonableness 31
of individual administrative expenditures as well as total administrative costs. The commissioner 32
shall make recommendations on the levels of reserves, including consideration of: targeted reserve 33
levels; trends in the increase or decrease of reserve levels; and insurer plans for distributing excess 34
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reserves. 1
(c) To establish a consumer/business/labor/medical advisory council to obtain information 2
and present concerns of consumers, business, and medical providers affected by health insurance 3
decisions. The council shall develop proposals to allow the market for small business health 4
insurance to be affordable and fairer. The council shall be involved in the planning and conduct of 5
the quarterly public meetings in accordance with subsection (a). The advisory council shall develop 6
measures to inform small businesses of an insurance complaint process to ensure that small 7
businesses that experience rate increases in a given year may request and receive a formal review 8
by the department. The advisory council shall assess views of the health provider community 9
relative to insurance rates of reimbursement, billing, and reimbursement procedures, and the 10
insurers’ role in promoting efficient and high-quality health care. The advisory council shall issue 11
an annual report of findings and recommendations to the governor and the general assembly and 12
present its findings at hearings before the house and senate finance committees. The advisory 13
council is to be diverse in interests and shall include representatives of community consumer 14
organizations; small businesses, other than those involved in the sale of insurance products; and 15
hospital, medical, and other health provider organizations. Such representatives shall be nominated 16
by their respective organizations. The advisory council shall be co-chaired by the health insurance 17
commissioner and a community consumer organization or small business member to be elected by 18
the full advisory council. 19
(d) To establish and provide guidance and assistance to a subcommittee (“the professional-20
provider-health-plan work group”) of the advisory council created pursuant to subsection (c), 21
composed of healthcare providers and Rhode Island licensed health plans. This subcommittee shall 22
include in its annual report and presentation before the house and senate finance committees the 23
following information: 24
(1) A method whereby health plans shall disclose to contracted providers the fee schedules 25
used to provide payment to those providers for services rendered to covered patients; 26
(2) A standardized provider application and credentials verification process, for the 27
purpose of verifying professional qualifications of participating healthcare providers; 28
(3) The uniform health plan claim form utilized by participating providers; 29
(4) Methods for health maintenance organizations, as defined by § 27-41-2, and nonprofit 30
hospital or medical service corporations, as defined by chapters 19 and 20 of title 27, to make 31
facility-specific data and other medical service-specific data available in reasonably consistent 32
formats to patients regarding quality and costs. This information would help consumers make 33
informed choices regarding the facilities and clinicians or physician practices at which to seek care. 34
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Among the items considered would be the unique health services and other public goods provided 1
by facilities and clinicians or physician practices in establishing the most appropriate cost 2
comparisons; 3
(5) All activities related to contractual disclosure to participating providers of the 4
mechanisms for resolving health plan/provider disputes; 5
(6) The uniform process being utilized for confirming, in real time, patient insurance 6
enrollment status, benefits coverage, including copays and deductibles; 7
(7) Information related to temporary credentialing of providers seeking to participate in the 8
plan’s network and the impact of the activity on health plan accreditation; 9
(8) The feasibility of regular contract renegotiations between plans and the providers in 10
their networks; and 11
(9) Efforts conducted related to reviewing impact of silent PPOs on physician practices. 12
(e) To enforce the provisions of title 27 and title 42 as set forth in § 42-14-5(d). 13
(f) To provide analysis of the Rhode Island affordable health plan reinsurance fund. The 14
fund shall be used to effectuate the provisions of §§ 27-18.5-9 and 27-50-17. 15
(g) To analyze the impact of changing the rating guidelines and/or merging the individual 16
health insurance market, as defined in chapter 18.5 of title 27, and the small-employer health 17
insurance market, as defined in chapter 50 of title 27, in accordance with the following: 18
(1) The analysis shall forecast the likely rate increases required to effect the changes 19
recommended pursuant to the preceding subsection (g) in the direct-pay market and small-employer 20
health insurance market over the next five (5) years, based on the current rating structure and 21
current products. 22
(2) The analysis shall include examining the impact of merging the individual and small-23
employer markets on premiums charged to individuals and small-employer groups. 24
(3) The analysis shall include examining the impact on rates in each of the individual and 25
small-employer health insurance markets and the number of insureds in the context of possible 26
changes to the rating guidelines used for small-employer groups, including: community rating 27
principles; expanding small-employer rate bonds beyond the current range; increasing the employer 28
group size in the small-group market; and/or adding rating factors for broker and/or tobacco use. 29
(4) The analysis shall include examining the adequacy of current statutory and regulatory 30
oversight of the rating process and factors employed by the participants in the proposed, new 31
merged market. 32
(5) The analysis shall include assessment of possible reinsurance mechanisms and/or 33
federal high-risk pool structures and funding to support the health insurance market in Rhode Island 34
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by reducing the risk of adverse selection and the incremental insurance premiums charged for this 1
risk, and/or by making health insurance affordable for a selected at-risk population. 2
(6) The health insurance commissioner shall work with an insurance market merger task 3
force to assist with the analysis. The task force shall be chaired by the health insurance 4
commissioner and shall include, but not be limited to, representatives of the general assembly, the 5
business community, small-employer carriers as defined in § 27-50-3, carriers offering coverage in 6
the individual market in Rhode Island, health insurance brokers, and members of the general public. 7
(7) For the purposes of conducting this analysis, the commissioner may contract with an 8
outside organization with expertise in fiscal analysis of the private insurance market. In conducting 9
its study, the organization shall, to the extent possible, obtain and use actual health plan data. Said 10
data shall be subject to state and federal laws and regulations governing confidentiality of health 11
care and proprietary information. 12
(8) The task force shall meet as necessary and include its findings in the annual report, and 13
the commissioner shall include the information in the annual presentation before the house and 14
senate finance committees. 15
(h) To establish and convene a workgroup representing healthcare providers and health 16
insurers for the purpose of coordinating the development of processes, guidelines, and standards to 17
streamline healthcare administration that are to be adopted by payors and providers of healthcare 18
services operating in the state. This workgroup shall include representatives with expertise who 19
would contribute to the streamlining of healthcare administration and who are selected from 20
hospitals, physician practices, community behavioral health organizations, each health insurer, and 21
other affected entities. The workgroup shall also include at least one designee each from the Rhode 22
Island Medical Society, Rhode Island Council of Community Mental Health Organizations, the 23
Rhode Island Health Center Association, and the Hospital Association of Rhode Island. In any year 24
that the workgroup meets and submits recommendations to the office of the health insurance 25
commissioner, the office of the health insurance commissioner shall submit such recommendations 26
to the health and human services committees of the Rhode Island house of representatives and the 27
Rhode Island senate prior to the implementation of any such recommendations and subsequently 28
shall submit a report to the general assembly by June 30, 2024. The report shall include the 29
recommendations the commissioner may implement, with supporting rationale. The workgroup 30
shall consider and make recommendations for: 31
(1) Establishing a consistent standard for electronic eligibility and coverage verification. 32
Such standard shall: 33
(i) Include standards for eligibility inquiry and response and, wherever possible, be 34
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consistent with the standards adopted by nationally recognized organizations, such as the Centers 1
for Medicare & Medicaid Services; 2
(ii) Enable providers and payors to exchange eligibility requests and responses on a system-3
to-system basis or using a payor-supported web browser; 4
(iii) Provide reasonably detailed information on a consumer’s eligibility for healthcare 5
coverage; scope of benefits; limitations and exclusions provided under that coverage; cost-sharing 6
requirements for specific services at the specific time of the inquiry; current deductible amounts; 7
accumulated or limited benefits; out-of-pocket maximums; any maximum policy amounts; and 8
other information required for the provider to collect the patient’s portion of the bill; 9
(iv) Reflect the necessary limitations imposed on payors by the originator of the eligibility 10
and benefits information; 11
(v) Recommend a standard or common process to protect all providers from the costs of 12
services to patients who are ineligible for insurance coverage in circumstances where a payor 13
provides eligibility verification based on best information available to the payor at the date of the 14
request of eligibility. 15
(2) Developing implementation guidelines and promoting adoption of the guidelines for: 16
(i) The use of the National Correct Coding Initiative code-edit policy by payors and 17
providers in the state; 18
(ii) Publishing any variations from codes and mutually exclusive codes by payors in a 19
manner that makes for simple retrieval and implementation by providers; 20
(iii) Use of Health Insurance Portability and Accountability Act standard group codes, 21
reason codes, and remark codes by payors in electronic remittances sent to providers; 22
(iv) Uniformity in the processing of claims by payors; and the processing of corrections to 23
claims by providers and payors; 24
(v) A standard payor-denial review process for providers when they request a 25
reconsideration of a denial of a claim that results from differences in clinical edits where no single, 26
common-standards body or process exists and multiple conflicting sources are in use by payors and 27
providers. 28
(vi) Nothing in this section, nor in the guidelines developed, shall inhibit an individual 29
payor’s ability to employ, and not disclose to providers, temporary code edits for the purpose of 30
detecting and deterring fraudulent billing activities. The guidelines shall require that each payor 31
disclose to the provider its adjudication decision on a claim that was denied or adjusted based on 32
the application of such edits and that the provider have access to the payor’s review and appeal 33
process to challenge the payor’s adjudication decision. 34
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(vii) Nothing in this subsection shall be construed to modify the rights or obligations of 1
payors or providers with respect to procedures relating to the investigation, reporting, appeal, or 2
prosecution under applicable law of potentially fraudulent billing activities. 3
(3) Developing and promoting widespread adoption by payors and providers of guidelines 4
to: 5
(i) Ensure payors do not automatically deny claims for services when extenuating 6
circumstances make it impossible for the provider to obtain a preauthorization before services are 7
performed or notify a payor within an appropriate standardized timeline of a patient’s admission; 8
(ii) Require payors to use common and consistent processes and time frames when 9
responding to provider requests for medical management approvals. Whenever possible, such time 10
frames shall be consistent with those established by leading national organizations and be based 11
upon the acuity of the patient’s need for care or treatment. For the purposes of this section, medical 12
management includes prior authorization of services, preauthorization of services, precertification 13
of services, post-service review, medical-necessity review, and benefits advisory; 14
(iii) Develop, maintain, and promote widespread adoption of a single, common website 15
where providers can obtain payors’ preauthorization, benefits advisory, and preadmission 16
requirements; 17
(iv) Establish guidelines for payors to develop and maintain a website that providers can 18
use to request a preauthorization, including a prospective clinical necessity review; receive an 19
authorization number; and transmit an admission notification; 20
(v) Develop and implement the use of programs that implement selective prior 21
authorization requirements, based on stratification of healthcare providers’ performance and 22
adherence to evidence-based medicine with the input of contracted healthcare providers and/or 23
provider organizations. Such criteria shall be transparent and easily accessible to contracted 24
providers. Such selective prior authorization programs shall be available when healthcare providers 25
participate directly with the insurer in risk-based payment contracts and may be available to 26
providers who do not participate in risk-based contracts; 27
(vi) Require the review of medical services, including behavioral health services, and 28
prescription drugs, subject to prior authorization on at least an annual basis, with the input of 29
contracted healthcare providers and/or provider organizations. Any changes to the list of medical 30
services, including behavioral health services, and prescription drugs requiring prior authorization, 31
shall be shared via provider-accessible websites; 32
(vii) Improve communication channels between health plans, healthcare providers, and 33
patients by: 34
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(A) Requiring transparency and easy accessibility of prior authorization requirements, 1
criteria, rationale, and program changes to contracted healthcare providers and patients/health plan 2
enrollees which may be satisfied by posting to provider-accessible and member-accessible 3
websites; and 4
(B) Supporting: 5
(I) Timely submission by healthcare providers of the complete information necessary to 6
make a prior authorization determination, as early in the process as possible; and 7
(II) Timely notification of prior authorization determinations by health plans to impacted 8
health plan enrollees, and healthcare providers, including, but not limited to, ordering providers, 9
and/or rendering providers, and dispensing pharmacists which may be satisfied by posting to 10
provider-accessible websites or similar electronic portals or services; 11
(viii) Increase and strengthen continuity of patient care by: 12
(A) Defining protections for continuity of care during a transition period for patients 13
undergoing an active course of treatment, when there is a formulary or treatment coverage change 14
or change of health plan that may disrupt their current course of treatment and when the treating 15
physician determines that a transition may place the patient at risk; and for prescription medication 16
by allowing a grace period of coverage to allow consideration of referred health plan options or 17
establishment of medical necessity of the current course of treatment; 18
(B) Requiring continuity of care for medical services, including behavioral health services, 19
and prescription medications for patients on appropriate, chronic, stable therapy through 20
minimizing repetitive prior authorization requirements; and which for prescription medication shall 21
be allowed only on an annual review, with exception for labeled limitation, to establish continued 22
benefit of treatment; and 23
(C) Requiring communication between healthcare providers, health plans, and patients to 24
facilitate continuity of care and minimize disruptions in needed treatment which may be satisfied 25
by posting to provider-accessible websites or similar electronic portals or services; 26
(D) Continuity of care for formulary or drug coverage shall distinguish between FDA 27
designated interchangeable products and proprietary or marketed versions of a medication; 28
(ix) Encourage healthcare providers and/or provider organizations and health plans to 29
accelerate use of electronic prior authorization technology, including adoption of national standards 30
where applicable; and 31
(x) For the purposes of subsections (h)(3)(v) through (h)(3)(x) of this section, the 32
workgroup meeting may be conducted in part or whole through electronic methods. 33
(4) To provide a report to the house and senate, on or before January 1, 2017, with 34
LC000724 - Page 15 of 20
recommendations for establishing guidelines and regulations for systems that give patients 1
electronic access to their claims information, particularly to information regarding their obligations 2
to pay for received medical services, pursuant to 45 C.F.R. § 164.524. 3
(5) No provision of this subsection (h) shall preclude the ongoing work of the office of 4
health insurance commissioner’s administrative simplification task force, which includes meetings 5
with key stakeholders in order to improve, and provide recommendations regarding, the prior 6
authorization process. 7
(i) To issue an anti-cancer medication report. Not later than June 30, 2014, and annually 8
thereafter, the office of the health insurance commissioner (OHIC) shall provide the senate 9
committee on health and human services, and the house committee on corporations, with: (1) 10
Information on the availability in the commercial market of coverage for anti-cancer medication 11
options; (2) For the state employee’s health benefit plan, the costs of various cancer-treatment 12
options; (3) The changes in drug prices over the prior thirty-six (36) months; and (4) Member 13
utilization and cost-sharing expense. 14
(j) To monitor the adequacy of each health plan’s compliance with the provisions of the 15
federal Mental Health Parity Act, including a review of related claims processing and 16
reimbursement procedures. Findings, recommendations, and assessments shall be made available 17
to the public. 18
(k) To monitor the transition from fee-for-service and toward global and other alternative 19
payment methodologies for the payment for healthcare services. Alternative payment 20
methodologies should be assessed for their likelihood to promote access to affordable health 21
insurance, health outcomes, and performance. 22
(l) To report annually, no later than July 1, 2014, then biannually thereafter, on hospital 23
payment variation, including findings and recommendations, subject to available resources. 24
(m) Notwithstanding any provision of the general or public laws or regulation to the 25
contrary, provide a report with findings and recommendations to the president of the senate and the 26
speaker of the house, on or before April 1, 2014, including, but not limited to, the following 27
information: 28
(1) The impact of the current, mandated healthcare benefits as defined in §§ 27-18-48.1, 29
27-18-60, 27-18-62, 27-18-64, similar provisions in chapters 19, 20 and 41 of title 27, and §§ 27-30
18-3(c), 27-38.2-1 et seq., or others as determined by the commissioner, on the cost of health 31
insurance for fully insured employers, subject to available resources; 32
(2) Current provider and insurer mandates that are unnecessary and/or duplicative due to 33
the existing standards of care and/or delivery of services in the healthcare system; 34
LC000724 - Page 16 of 20
(3) A state-by-state comparison of health insurance mandates and the extent to which 1
Rhode Island mandates exceed other states benefits; and 2
(4) Recommendations for amendments to existing mandated benefits based on the findings 3
in (m)(1), (m)(2), and (m)(3) above. 4
(n) On or before July 1, 2014, the office of the health insurance commissioner, in 5
collaboration with the director of health and lieutenant governor’s office, shall submit a report to 6
the general assembly and the governor to inform the design of accountable care organizations 7
(ACOs) in Rhode Island as unique structures for comprehensive healthcare delivery and value-8
based payment arrangements, that shall include, but not be limited to: 9
(1) Utilization review; 10
(2) Contracting; and 11
(3) Licensing and regulation. 12
(o) On or before February 3, 2015, the office of the health insurance commissioner shall 13
submit a report to the general assembly and the governor that describes, analyzes, and proposes 14
recommendations to improve compliance of insurers with the provisions of § 27-18-76 with regard 15
to patients with mental health and substance use disorders. 16
(p) To work to ensure the health insurance coverage of behavioral health care under the 17
same terms and conditions as other health care, and to integrate behavioral health parity 18
requirements into the office of the health insurance commissioner insurance oversight and 19
healthcare transformation efforts. 20
(q) To work with other state agencies to seek delivery system improvements that enhance 21
access to a continuum of mental health and substance use disorder treatment in the state; and 22
integrate that treatment with primary and other medical care to the fullest extent possible. 23
(r) To direct insurers toward policies and practices that address the behavioral health needs 24
of the public and greater integration of physical and behavioral healthcare delivery. 25
(s) The office of the health insurance commissioner shall conduct an analysis of the impact 26
of the provisions of § 27-38.2-1(i) on health insurance premiums and access in Rhode Island and 27
submit a report of its findings to the general assembly on or before June 1, 2023. 28
(t) To undertake the analyses, reports, and studies contained in this section: 29
(1) The office shall hire the necessary staff and prepare a request for proposal for a qualified 30
and competent firm or firms to undertake the following analyses, reports, and studies: 31
(i) The firm shall undertake a comprehensive review of all social and human service 32
programs having a contract with or licensed by the state or any subdivision of the department of 33
children, youth and families (DCYF), the department of behavioral healthcare, developmental 34
LC000724 - Page 17 of 20
disabilities and hospitals (BHDDH), the department of human services (DHS), the department of 1
health (DOH), and Medicaid for the purposes of: 2
(A) Establishing a baseline of the eligibility factors for receiving services; 3
(B) Establishing a baseline of the service offering through each agency for those 4
determined eligible; 5
(C) Establishing a baseline understanding of reimbursement rates for all social and human 6
service programs including rates currently being paid, the date of the last increase, and a proposed 7
model that the state may use to conduct future studies and analyses; 8
(D) Ensuring accurate and adequate reimbursement to social and human service providers 9
that facilitate the availability of high-quality services to individuals receiving home and 10
community-based long-term services and supports provided by social and human service providers; 11
(E) Ensuring the general assembly is provided accurate financial projections on social and 12
human service program costs, demand for services, and workforce needs to ensure access to entitled 13
beneficiaries and services; 14
(F) Establishing a baseline and determining the relationship between state government and 15
the provider network including functions, responsibilities, and duties; 16
(G) Determining a set of measures and accountability standards to be used by EOHHS and 17
the general assembly to measure the outcomes of the provision of services including budgetary 18
reporting requirements, transparency portals, and other methods; and 19
(H) Reporting the findings of human services analyses and reports to the speaker of the 20
house, senate president, chairs of the house and senate finance committees, chairs of the house and 21
senate health and human services committees, and the governor. 22
(2) The analyses, reports, and studies required pursuant to this section shall be 23
accomplished and published as follows and shall provide: 24
(i) An assessment and detailed reporting on all social and human service program rates to 25
be completed by January 1, 2023, including rates currently being paid and the date of the last 26
increase; 27
(ii) An assessment and detailed reporting on eligibility standards and processes of all 28
mandatory and discretionary social and human service programs to be completed by January 1, 29
2023; 30
(iii) An assessment and detailed reporting on utilization trends from the period of January 31
1, 2017, through December 31, 2021, for social and human service programs to be completed by 32
January 1, 2023; 33
(iv) An assessment and detailed reporting on the structure of the state government as it 34
LC000724 - Page 18 of 20
relates to the provision of services by social and human service providers including eligibility and 1
functions of the provider network to be completed by January 1, 2023; 2
(v) An assessment and detailed reporting on accountability standards for services for social 3
and human service programs to be completed by January 1, 2023; 4
(vi) An assessment and detailed reporting by April 1, 2023, on all professional licensed 5
and unlicensed personnel requirements for established rates for social and human service programs 6
pursuant to a contract or established fee schedule; 7
(vii) An assessment and reporting on access to social and human service programs, to 8
include any wait lists and length of time on wait lists, in each service category by April 1, 2023; 9
(viii) An assessment and reporting of national and regional Medicaid rates in comparison 10
to Rhode Island social and human service provider rates by April 1, 2023; 11
(ix) An assessment and reporting on usual and customary rates paid by private insurers and 12
private pay for similar social and human service providers, both nationally and regionally, by April 13
1, 2023; and 14
(x) Completion of the development of an assessment and review process that includes the 15
following components: eligibility; scope of services; relationship of social and human service 16
provider and the state; national and regional rate comparisons and accountability standards that 17
result in recommended rate adjustments; and this process shall be completed by September 1, 2023, 18
and conducted biennially hereafter. The biennial rate setting shall be consistent with payment 19
requirements established in § 1902(a)(30)(A) of the Social Security Act, 42 U.S.C. § 20
1396a(a)(30)(A), and all federal and state law, regulations, and quality and safety standards. The 21
results and findings of this process shall be transparent, and public meetings shall be conducted to 22
allow providers, recipients, and other interested parties an opportunity to ask questions and provide 23
comment beginning in September 2023 and biennially thereafter. 24
(3) In fulfillment of the responsibilities defined in subsection (t), the office of the health 25
insurance commissioner shall consult with the Executive Office of Health and Human Services. 26
(u) Annually, each department (namely, EOHHS, DCYF, DOH, DHS, and BHDDH) shall 27
include the corresponding components of the assessment and review (i.e., eligibility; scope of 28
services; relationship of social and human service provider and the state; and national and regional 29
rate comparisons and accountability standards including any changes or substantive issues between 30
biennial reviews) including the recommended rates from the most recent assessment and review 31
with their annual budget submission to the office of management and budget and provide a detailed 32
explanation and impact statement if any rate variances exist between submitted recommended 33
budget and the corresponding recommended rate from the most recent assessment and review 34
LC000724 - Page 19 of 20
process starting October 1, 2023, and biennially thereafter. 1
(v) To enforce the provisions of title 27 as set forth in § 27-83-1 through § 27-83-6. 2
(v)(w) The general assembly shall appropriate adequate funding as it deems necessary to 3
undertake the analyses, reports, and studies contained in this section relating to the powers and 4
duties of the office of the health insurance commissioner. 5
SECTION 4. This act shall take effect upon passage. 6
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EXPLANATION
BY THE LEGISLATIVE COUNCIL
OF
A N A C T
RELATING TO INSURANCE -- THE TRANSPARENCY AND ACCOUNTABILITY IN
ARTIFICIAL INTELLIGENCE USE BY HEALTH INSURERS TO MANAGE COVERAGE
AND CLAIMS ACT
***
This act would promote transparency and accountability in the use of artificial intelligence 1
by health insurers to manage coverage and claims. 2
This act would take effect upon passage. 3
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