Rhode Island 2025 Regular Session

Rhode Island House Bill H5172 Compare Versions

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

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5	5	2025 -- H 5172
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7	7	LC000724
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9	9	S T A T E O F R H O D E I S L A N D
10	10	IN GENERAL ASSEMBLY
11	11	JANUARY SESSION, A.D. 2025
12	12	____________
13	13
14	14	A N A C T
15	15	RELATING TO INSURANCE -- THE TRANSPARENCY AND ACCOUNTABILITY IN
16	16	ARTIFICIAL INTELLIGENCE USE BY HEALTH INSURERS TO MANAGE COV ERAGE
17	17	AND CLAIMS ACT
18	18	Introduced By: Representatives Donovan, Speakman, Potter, Bennett, Giraldo, Stewart,
19	19	Fogarty, Handy, McGaw, and Morales
20	20	Date Introduced: January 24, 2025
21	21	Referred To: House Health & Human Services
22	22
23	23
24	24	It is enacted by the General Assembly as follows:
25	25	SECTION 1. Title 27 of the General Laws entitled "INSURANCE" is hereby amended by 1
26	26	adding thereto the following chapter: 2
27	27	CHAPTER 83 3
28	28	THE TRANSPARENCY AND ACCOUNTABI LITY IN ARTIFICIAL INTELLIGENCE USE 4
29	29	BY HEALTH INSURERS TO MANAGE COVERAGE AND CLAIMS ACT 5
30	30	27-83-1. Short title and purpose. 6
31	31	(a) This chapter shall be known and may be cited as "The Transparency and Accountability 7
32	32	in Artificial Intelligence Use by Health Insurers to Manage Coverage and Claims Act." 8
33	33	(b) The purpose of this chapter is to regulate the use of artificial intelligence (AI) by health 9
34	34	insurers to ensure transparency, accountability and compliance with state and federal requirements 10
35	35	for claims and coverage management including anti-discrimination and privacy laws. 11
36	36	27-83-2. Definitions. 12
37	37	As used in this chapter, the following terms shall have the following meanings, unless the 13
38	38	context clearly indicates otherwise: 14
39	39	(1) "Adverse determination" means any of the following: a denial, reduction, or termination 15
40	40	of, or a failure to provide or make payment (in whole or in part) for, a benefit, including any such 16
41	41	denial, reduction, termination, or failure to provide or make payment that is based on a 17
42	42	determination of an individual’s eligibility to participate in a plan or to receive coverage under a 18
43	43
44	44
45	45	LC000724 - Page 2 of 20
46	46	plan, and including, with respect to group health plans, a denial, reduction, or termination of, or a 1
47	47	failure to provide or make payment (in whole or in part) for, a benefit resulting from the application 2
48	48	of any utilization review, as well as a failure to cover an item or service for which benefits are 3
49	49	otherwise provided as a result of a determination that the item or service is experimental or 4
50	50	investigational or not medically necessary or appropriate. The term also includes a rescission of 5
51	51	coverage determination. 6
52	52	(2) "Artificial intelligence" or "AI" means a machine-based system that undertakes 7
53	53	analysis, reasoning and problem-solving, and that can be used to generate predictions, 8
54	54	recommendations, or other content. 9
55	55	(3) "Enrollee" means an individual who has health insurance coverage through an insurer. 10
56	56	(4) "Insurer" means all insurance companies licensed to do business in Rhode Island, 11
57	57	including those subject to chapter 1 of title 27, a foreign insurance company licensed to do business 12
58	58	in Rhode Island and subject to chapter 2 of title 27, a health insurance carrier subject to and 13
59	59	organized pursuant to chapter 18 of title 27, a nonprofit hospital service corporation subject to and 14
60	60	organized pursuant to chapter 19 of title 27, a nonprofit medical services corporation subject to and 15
61	61	organized pursuant to chapter 20 of title 27, a qualified health maintenance organization subject to 16
62	62	and organized pursuant to chapter 41 of title 27, and Medicaid managed care organizations as 17
63	63	described in §42-7.4-2. 18
64	64	(5) "Medically necessary care" means a medical, surgical, or other service required for the 19
65	65	prevention, diagnosis, cure, or treatment of a health-related condition including any such services 20
66	66	that are necessary to prevent or slow a decremental change in either medical or mental health status. 21
67	67	(6) "Third party" means an individual or entity, including independent contractors, 22
68	68	pharmacy benefit managers and group purchasing organizations, that provides to an insurer 23
69	69	services, including software development, data collection, analysis and administrative or other 24
70	70	resources that manage or assist in managing enrollee healthcare coverage and claims. 25
71	71	27-83-3. Requirements. 26
72	72	(a) Transparency. 27
73	73	(1) Insurers shall publicly disclose how they use AI to manage claims and coverage, 28
74	74	including underlying algorithms, data used, and resulting determinations. 29
75	75	(2) Insurers shall submit to the office of the health insurance commissioner and the 30
76	76	executive office of health and human services, upon request, all information, including documents 31
77	77	and software, that permits enforcement of this chapter. 32
78	78	(3) Insurers shall maintain documentation of AI decisions for at least five (5) years. 33
79	79	(4) Insurers shall provide notice to enrollees and healthcare providers when AI has been 34
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83	83	used to issue an adverse determination and provide a clear and timely process for appealing the 1
84	84	determination. 2
85	85	(b) Accountability. 3
86	86	(1) Insurers shall not rely exclusively on AI or automated decision tools to deny, reduce, 4
87	87	or alter coverage or claims for medically necessary care. 5
88	88	(2) Adverse determinations shall be reviewed by physicians or other licensed healthcare 6
89	89	professionals who are qualified in the appropriate specialties, without conflicts of interest or 7
90	90	incentives to confirm adverse determinations, and who have the authority to reverse adverse 8
91	91	determinations based on their clinical judgment. 9
92	92	(3) Insurers shall conduct on-going monitoring, audits and oversight of all employees and 10
93	93	third parties using AI on their behalf to manage enrollee coverage or claims, including taking 11
94	94	actions to ensure: 12
95	95	(i) Enrollee medically necessary care has not been delayed, denied or limited; 13
96	96	(ii) Financial and administrative burdens on enrollees and healthcare providers are 14
97	97	reasonable and minimized; 15
98	98	(iii) Private enrollee health information is protected as required under state and federal 16
99	99	privacy laws; and 17
100	100	(iv) AI use does not violate enrollee rights under state and federal laws prohibiting 18
101	101	discrimination, including those based on age, race, sex, sexual orientation, and pre-existing 19
102	102	conditions. 20
103	103	27-83-4. Enforcement. 21
104	104	(a) The office of the health insurance commissioner and the executive office of health and 22
105	105	human services, in collaboration with other state authorities including the department of business 23
106	106	regulation, the secretary of state, and the attorney general, are authorized to promulgate such rules 24
107	107	and regulations, and take such actions as may be necessary, to implement and enforce the provisions 25
108	108	of this chapter. 26
109	109	(b) Nothing in this chapter shall limit them from taking independent actions permitted 27
110	110	under any state or federal law, including, but not limited to, consumer protection laws related to 28
111	111	antitrust, and deceptive trade practices as described in chapter 13.1 of title 6 ("deceptive trade 29
112	112	practices"). 30
113	113	(c) Enrollees have a private right of action to enforce the provisions of this chapter. 31
114	114	(d) Violations of this chapter may result in: 32
115	115	(1) Orders to change or limit how insurers use AI for management of enrollee coverage 33
116	116	and claims; 34
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120	120	(2) Fines of up to fifty thousand dollars ($50,000) per violation; 1
121	121	(3) Revocation or suspension of the insurer’s licenses in Rhode Island; and 2
122	122	(4) Compensation and damages to affected enrollees and health care providers, including 3
123	123	pharmacies and hospitals. 4
124	124	27-83-5. Application. 5
125	125	This chapter supplements requirements set forth in other general laws. To the extent there 6
126	126	is any direct conflict, the provisions of this chapter shall control over any more general provisions. 7
127	127	27-83-6. Severability. 8
128	128	If any provision of this chapter is found unconstitutional, preempted, or otherwise invalid, 9
129	129	that provision shall be severed, and such decision shall not affect the validity of the remaining 10
130	130	provisions of this chapter. 11
131	131	SECTION 2. Section 42-7.2-5 of the General Laws in Chapter 42-7.2 entitled "Office of 12
132	132	Health and Human Services" is hereby amended to read as follows: 13
133	133	42-7.2-5. Duties of the secretary. 14
134	134	The secretary shall be subject to the direction and supervision of the governor for the 15
135	135	oversight, coordination, and cohesive direction of state-administered health and human services 16
136	136	and in ensuring the laws are faithfully executed, notwithstanding any law to the contrary. In this 17
137	137	capacity, the secretary of the executive office of health and human services (EOHHS) shall be 18
138	138	authorized to: 19
139	139	(1) Coordinate the administration and financing of healthcare benefits, human services, and 20
140	140	programs including those authorized by the state’s Medicaid section 1115 demonstration waiver 21
141	141	and, as applicable, the Medicaid state plan under Title XIX of the U.S. Social Security Act. 22
142	142	However, nothing in this section shall be construed as transferring to the secretary the powers, 23
143	143	duties, or functions conferred upon the departments by Rhode Island public and general laws for 24
144	144	the administration of federal/state programs financed in whole or in part with Medicaid funds or 25
145	145	the administrative responsibility for the preparation and submission of any state plans, state plan 26
146	146	amendments, or authorized federal waiver applications, once approved by the secretary. 27
147	147	(2) Serve as the governor’s chief advisor and liaison to federal policymakers on Medicaid 28
148	148	reform issues as well as the principal point of contact in the state on any such related matters. 29
149	149	(3)(i) Review and ensure the coordination of the state’s Medicaid section 1115 30
150	150	demonstration waiver requests and renewals as well as any initiatives and proposals requiring 31
151	151	amendments to the Medicaid state plan or formal amendment changes, as described in the special 32
152	152	terms and conditions of the state’s Medicaid section 1115 demonstration waiver with the potential 33
153	153	to affect the scope, amount, or duration of publicly funded healthcare services, provider payments 34
154	154
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157	157	or reimbursements, or access to or the availability of benefits and services as provided by Rhode 1
158	158	Island general and public laws. The secretary shall consider whether any such changes are legally 2
159	159	and fiscally sound and consistent with the state’s policy and budget priorities. The secretary shall 3
160	160	also assess whether a proposed change is capable of obtaining the necessary approvals from federal 4
161	161	officials and achieving the expected positive consumer outcomes. Department directors shall, 5
162	162	within the timelines specified, provide any information and resources the secretary deems necessary 6
163	163	in order to perform the reviews authorized in this section. 7
164	164	(ii) Direct the development and implementation of any Medicaid policies, procedures, or 8
165	165	systems that may be required to assure successful operation of the state’s health and human services 9
166	166	integrated eligibility system and coordination with HealthSource RI, the state’s health insurance 10
167	167	marketplace. 11
168	168	(iii) Beginning in 2015, conduct on a biennial basis a comprehensive review of the 12
169	169	Medicaid eligibility criteria for one or more of the populations covered under the state plan or a 13
170	170	waiver to ensure consistency with federal and state laws and policies, coordinate and align systems, 14
171	171	and identify areas for improving quality assurance, fair and equitable access to services, and 15
172	172	opportunities for additional financial participation. 16
173	173	(iv) Implement service organization and delivery reforms that facilitate service integration, 17
174	174	increase value, and improve quality and health outcomes. 18
175	175	(4) Beginning in 2020, prepare and submit to the governor, the chairpersons of the house 19
176	176	and senate finance committees, the caseload estimating conference, and to the joint legislative 20
177	177	committee for health-care oversight, by no later than September 15 of each year, a comprehensive 21
178	178	overview of all Medicaid expenditures outcomes, administrative costs, and utilization rates. The 22
179	179	overview shall include, but not be limited to, the following information: 23
180	180	(i) Expenditures under Titles XIX and XXI of the Social Security Act, as amended; 24
181	181	(ii) Expenditures, outcomes, and utilization rates by population and sub-population served 25
182	182	(e.g., families with children, persons with disabilities, children in foster care, children receiving 26
183	183	adoption assistance, adults ages nineteen (19) to sixty-four (64), and elders); 27
184	184	(iii) Expenditures, outcomes, and utilization rates by each state department or other 28
185	185	municipal or public entity receiving federal reimbursement under Titles XIX and XXI of the Social 29
186	186	Security Act, as amended; 30
187	187	(iv) Expenditures, outcomes, and utilization rates by type of service and/or service 31
188	188	provider; 32
189	189	(v) Expenditures by mandatory population receiving mandatory services and, reported 33
190	190	separately, optional services, as well as optional populations receiving mandatory services and, 34
191	191
192	192
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194	194	reported separately, optional services for each state agency receiving Title XIX and XXI funds; and 1
195	195	(vi) Information submitted to the Centers for Medicare & Medicaid Services for the 2
196	196	mandatory annual state reporting of the Core Set of Children’s Health Care Quality Measures for 3
197	197	Medicaid and Children’s Health Insurance Program, behavioral health measures on the Core Set of 4
198	198	Adult Health Care Quality Measures for Medicaid and the Core Sets of Health Home Quality 5
199	199	Measures for Medicaid to ensure compliance with the Bipartisan Budget Act of 2018, Pub. L. No. 6
200	200	115-123. 7
201	201	The directors of the departments, as well as local governments and school departments, 8
202	202	shall assist and cooperate with the secretary in fulfilling this responsibility by providing whatever 9
203	203	resources, information and support shall be necessary. 10
204	204	(5) Resolve administrative, jurisdictional, operational, program, or policy conflicts among 11
205	205	departments and their executive staffs and make necessary recommendations to the governor. 12
206	206	(6) Ensure continued progress toward improving the quality, the economy, the 13
207	207	accountability, and the efficiency of state-administered health and human services. In this capacity, 14
208	208	the secretary shall: 15
209	209	(i) Direct implementation of reforms in the human resources practices of the executive 16
210	210	office and the departments that streamline and upgrade services, achieve greater economies of scale 17
211	211	and establish the coordinated system of the staff education, cross-training, and career development 18
212	212	services necessary to recruit and retain a highly-skilled, responsive, and engaged health and human 19
213	213	services workforce; 20
214	214	(ii) Encourage EOHHS-wide consumer-centered approaches to service design and delivery 21
215	215	that expand their capacity to respond efficiently and responsibly to the diverse and changing needs 22
216	216	of the people and communities they serve; 23
217	217	(iii) Develop all opportunities to maximize resources by leveraging the state’s purchasing 24
218	218	power, centralizing fiscal service functions related to budget, finance, and procurement, 25
219	219	centralizing communication, policy analysis and planning, and information systems and data 26
220	220	management, pursuing alternative funding sources through grants, awards, and partnerships and 27
221	221	securing all available federal financial participation for programs and services provided EOHHS-28
222	222	wide; 29
223	223	(iv) Improve the coordination and efficiency of health and human services legal functions 30
224	224	by centralizing adjudicative and legal services and overseeing their timely and judicious 31
225	225	administration; 32
226	226	(v) Facilitate the rebalancing of the long-term system by creating an assessment and 33
227	227	coordination organization or unit for the expressed purpose of developing and implementing 34
228	228
229	229
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231	231	procedures EOHHS-wide that ensure that the appropriate publicly funded health services are 1
232	232	provided at the right time and in the most appropriate and least restrictive setting; 2
233	233	(vi) Strengthen health and human services program integrity, quality control and 3
234	234	collections, and recovery activities by consolidating functions within the office in a single unit that 4
235	235	ensures all affected parties pay their fair share of the cost of services and are aware of alternative 5
236	236	financing; 6
237	237	(vii) Assure protective services are available to vulnerable elders and adults with 7
238	238	developmental and other disabilities by reorganizing existing services, establishing new services 8
239	239	where gaps exist, and centralizing administrative responsibility for oversight of all related 9
240	240	initiatives and programs. 10
241	241	(7) Prepare and integrate comprehensive budgets for the health and human services 11
242	242	departments and any other functions and duties assigned to the office. The budgets shall be 12
243	243	submitted to the state budget office by the secretary, for consideration by the governor, on behalf 13
244	244	of the state’s health and human services agencies in accordance with the provisions set forth in § 14
245	245	35-3-4. 15
246	246	(8) Utilize objective data to evaluate health and human services policy goals, resource use 16
247	247	and outcome evaluation and to perform short and long-term policy planning and development. 17
248	248	(9) Establishment of an integrated approach to interdepartmental information and data 18
249	249	management that complements and furthers the goals of the unified health infrastructure project 19
250	250	initiative and that will facilitate the transition to a consumer-centered integrated system of state-20
251	251	administered health and human services. 21
252	252	(10) At the direction of the governor or the general assembly, conduct independent reviews 22
253	253	of state-administered health and human services programs, policies and related agency actions and 23
254	254	activities and assist the department directors in identifying strategies to address any issues or areas 24
255	255	of concern that may emerge thereof. The department directors shall provide any information and 25
256	256	assistance deemed necessary by the secretary when undertaking such independent reviews. 26
257	257	(11) Provide regular and timely reports to the governor and make recommendations with 27
258	258	respect to the state’s health and human services agenda. 28
259	259	(12) Employ such personnel and contract for such consulting services as may be required 29
260	260	to perform the powers and duties lawfully conferred upon the secretary. 30
261	261	(13) Assume responsibility for complying with the provisions of any general or public law 31
262	262	or regulation related to the disclosure, confidentiality, and privacy of any information or records, 32
263	263	in the possession or under the control of the executive office or the departments assigned to the 33
264	264	executive office, that may be developed or acquired or transferred at the direction of the governor 34
265	265
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268	268	or the secretary for purposes directly connected with the secretary’s duties set forth herein. 1
269	269	(14) Hold the director of each health and human services department accountable for their 2
270	270	administrative, fiscal, and program actions in the conduct of the respective powers and duties of 3
271	271	their agencies. 4
272	272	(15) Identify opportunities for inclusion with the EOHHS’ October 1, 2023 budget 5
273	273	submission, to remove fixed eligibility thresholds for programs under its purview by establishing 6
274	274	sliding scale decreases in benefits commensurate with income increases up to four hundred fifty 7
275	275	percent (450%) of the federal poverty level. These shall include but not be limited to, medical 8
276	276	assistance, childcare assistance, and food assistance. 9
277	277	(16) Enforce the provisions of title 27 as set forth in § 27-83-1 through § 27-83-6. 10
278	278	SECTION 3. Section 42-14.5-3 of the General Laws in Chapter 42-14.5 entitled "The 11
279	279	Rhode Island Health Care Reform Act of 2004 — Health Insurance Oversight" is hereby amended 12
280	280	to read as follows: 13
281	281	42-14.5-3. Powers and duties. 14
282	282	The health insurance commissioner shall have the following powers and duties: 15
283	283	(a) To conduct quarterly public meetings throughout the state, separate and distinct from 16
284	284	rate hearings pursuant to § 42-62-13, regarding the rates, services, and operations of insurers 17
285	285	licensed to provide health insurance in the state; the effects of such rates, services, and operations 18
286	286	on consumers, medical care providers, patients, and the market environment in which the insurers 19
287	287	operate; and efforts to bring new health insurers into the Rhode Island market. Notice of not less 20
288	288	than ten (10) days of the hearing(s) shall go to the general assembly, the governor, the Rhode Island 21
289	289	Medical Society, the Hospital Association of Rhode Island, the director of health, the attorney 22
290	290	general, and the chambers of commerce. Public notice shall be posted on the department’s website 23
291	291	and given in the newspaper of general circulation, and to any entity in writing requesting notice. 24
292	292	(b) To make recommendations to the governor and the house of representatives and senate 25
293	293	finance committees regarding healthcare insurance and the regulations, rates, services, 26
294	294	administrative expenses, reserve requirements, and operations of insurers providing health 27
295	295	insurance in the state, and to prepare or comment on, upon the request of the governor or 28
296	296	chairpersons of the house or senate finance committees, draft legislation to improve the regulation 29
297	297	of health insurance. In making the recommendations, the commissioner shall recognize that it is 30
298	298	the intent of the legislature that the maximum disclosure be provided regarding the reasonableness 31
299	299	of individual administrative expenditures as well as total administrative costs. The commissioner 32
300	300	shall make recommendations on the levels of reserves, including consideration of: targeted reserve 33
301	301	levels; trends in the increase or decrease of reserve levels; and insurer plans for distributing excess 34
302	302
303	303
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305	305	reserves. 1
306	306	(c) To establish a consumer/business/labor/medical advisory council to obtain information 2
307	307	and present concerns of consumers, business, and medical providers affected by health insurance 3
308	308	decisions. The council shall develop proposals to allow the market for small business health 4
309	309	insurance to be affordable and fairer. The council shall be involved in the planning and conduct of 5
310	310	the quarterly public meetings in accordance with subsection (a). The advisory council shall develop 6
311	311	measures to inform small businesses of an insurance complaint process to ensure that small 7
312	312	businesses that experience rate increases in a given year may request and receive a formal review 8
313	313	by the department. The advisory council shall assess views of the health provider community 9
314	314	relative to insurance rates of reimbursement, billing, and reimbursement procedures, and the 10
315	315	insurers’ role in promoting efficient and high-quality health care. The advisory council shall issue 11
316	316	an annual report of findings and recommendations to the governor and the general assembly and 12
317	317	present its findings at hearings before the house and senate finance committees. The advisory 13
318	318	council is to be diverse in interests and shall include representatives of community consumer 14
319	319	organizations; small businesses, other than those involved in the sale of insurance products; and 15
320	320	hospital, medical, and other health provider organizations. Such representatives shall be nominated 16
321	321	by their respective organizations. The advisory council shall be co-chaired by the health insurance 17
322	322	commissioner and a community consumer organization or small business member to be elected by 18
323	323	the full advisory council. 19
324	324	(d) To establish and provide guidance and assistance to a subcommittee (“the professional-20
325	325	provider-health-plan work group”) of the advisory council created pursuant to subsection (c), 21
326	326	composed of healthcare providers and Rhode Island licensed health plans. This subcommittee shall 22
327	327	include in its annual report and presentation before the house and senate finance committees the 23
328	328	following information: 24
329	329	(1) A method whereby health plans shall disclose to contracted providers the fee schedules 25
330	330	used to provide payment to those providers for services rendered to covered patients; 26
331	331	(2) A standardized provider application and credentials verification process, for the 27
332	332	purpose of verifying professional qualifications of participating healthcare providers; 28
333	333	(3) The uniform health plan claim form utilized by participating providers; 29
334	334	(4) Methods for health maintenance organizations, as defined by § 27-41-2, and nonprofit 30
335	335	hospital or medical service corporations, as defined by chapters 19 and 20 of title 27, to make 31
336	336	facility-specific data and other medical service-specific data available in reasonably consistent 32
337	337	formats to patients regarding quality and costs. This information would help consumers make 33
338	338	informed choices regarding the facilities and clinicians or physician practices at which to seek care. 34
339	339
340	340
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342	342	Among the items considered would be the unique health services and other public goods provided 1
343	343	by facilities and clinicians or physician practices in establishing the most appropriate cost 2
344	344	comparisons; 3
345	345	(5) All activities related to contractual disclosure to participating providers of the 4
346	346	mechanisms for resolving health plan/provider disputes; 5
347	347	(6) The uniform process being utilized for confirming, in real time, patient insurance 6
348	348	enrollment status, benefits coverage, including copays and deductibles; 7
349	349	(7) Information related to temporary credentialing of providers seeking to participate in the 8
350	350	plan’s network and the impact of the activity on health plan accreditation; 9
351	351	(8) The feasibility of regular contract renegotiations between plans and the providers in 10
352	352	their networks; and 11
353	353	(9) Efforts conducted related to reviewing impact of silent PPOs on physician practices. 12
354	354	(e) To enforce the provisions of title 27 and title 42 as set forth in § 42-14-5(d). 13
355	355	(f) To provide analysis of the Rhode Island affordable health plan reinsurance fund. The 14
356	356	fund shall be used to effectuate the provisions of §§ 27-18.5-9 and 27-50-17. 15
357	357	(g) To analyze the impact of changing the rating guidelines and/or merging the individual 16
358	358	health insurance market, as defined in chapter 18.5 of title 27, and the small-employer health 17
359	359	insurance market, as defined in chapter 50 of title 27, in accordance with the following: 18
360	360	(1) The analysis shall forecast the likely rate increases required to effect the changes 19
361	361	recommended pursuant to the preceding subsection (g) in the direct-pay market and small-employer 20
362	362	health insurance market over the next five (5) years, based on the current rating structure and 21
363	363	current products. 22
364	364	(2) The analysis shall include examining the impact of merging the individual and small-23
365	365	employer markets on premiums charged to individuals and small-employer groups. 24
366	366	(3) The analysis shall include examining the impact on rates in each of the individual and 25
367	367	small-employer health insurance markets and the number of insureds in the context of possible 26
368	368	changes to the rating guidelines used for small-employer groups, including: community rating 27
369	369	principles; expanding small-employer rate bonds beyond the current range; increasing the employer 28
370	370	group size in the small-group market; and/or adding rating factors for broker and/or tobacco use. 29
371	371	(4) The analysis shall include examining the adequacy of current statutory and regulatory 30
372	372	oversight of the rating process and factors employed by the participants in the proposed, new 31
373	373	merged market. 32
374	374	(5) The analysis shall include assessment of possible reinsurance mechanisms and/or 33
375	375	federal high-risk pool structures and funding to support the health insurance market in Rhode Island 34
376	376
377	377
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379	379	by reducing the risk of adverse selection and the incremental insurance premiums charged for this 1
380	380	risk, and/or by making health insurance affordable for a selected at-risk population. 2
381	381	(6) The health insurance commissioner shall work with an insurance market merger task 3
382	382	force to assist with the analysis. The task force shall be chaired by the health insurance 4
383	383	commissioner and shall include, but not be limited to, representatives of the general assembly, the 5
384	384	business community, small-employer carriers as defined in § 27-50-3, carriers offering coverage in 6
385	385	the individual market in Rhode Island, health insurance brokers, and members of the general public. 7
386	386	(7) For the purposes of conducting this analysis, the commissioner may contract with an 8
387	387	outside organization with expertise in fiscal analysis of the private insurance market. In conducting 9
388	388	its study, the organization shall, to the extent possible, obtain and use actual health plan data. Said 10
389	389	data shall be subject to state and federal laws and regulations governing confidentiality of health 11
390	390	care and proprietary information. 12
391	391	(8) The task force shall meet as necessary and include its findings in the annual report, and 13
392	392	the commissioner shall include the information in the annual presentation before the house and 14
393	393	senate finance committees. 15
394	394	(h) To establish and convene a workgroup representing healthcare providers and health 16
395	395	insurers for the purpose of coordinating the development of processes, guidelines, and standards to 17
396	396	streamline healthcare administration that are to be adopted by payors and providers of healthcare 18
397	397	services operating in the state. This workgroup shall include representatives with expertise who 19
398	398	would contribute to the streamlining of healthcare administration and who are selected from 20
399	399	hospitals, physician practices, community behavioral health organizations, each health insurer, and 21
400	400	other affected entities. The workgroup shall also include at least one designee each from the Rhode 22
401	401	Island Medical Society, Rhode Island Council of Community Mental Health Organizations, the 23
402	402	Rhode Island Health Center Association, and the Hospital Association of Rhode Island. In any year 24
403	403	that the workgroup meets and submits recommendations to the office of the health insurance 25
404	404	commissioner, the office of the health insurance commissioner shall submit such recommendations 26
405	405	to the health and human services committees of the Rhode Island house of representatives and the 27
406	406	Rhode Island senate prior to the implementation of any such recommendations and subsequently 28
407	407	shall submit a report to the general assembly by June 30, 2024. The report shall include the 29
408	408	recommendations the commissioner may implement, with supporting rationale. The workgroup 30
409	409	shall consider and make recommendations for: 31
410	410	(1) Establishing a consistent standard for electronic eligibility and coverage verification. 32
411	411	Such standard shall: 33
412	412	(i) Include standards for eligibility inquiry and response and, wherever possible, be 34
413	413
414	414
415	415	LC000724 - Page 12 of 20
416	416	consistent with the standards adopted by nationally recognized organizations, such as the Centers 1
417	417	for Medicare & Medicaid Services; 2
418	418	(ii) Enable providers and payors to exchange eligibility requests and responses on a system-3
419	419	to-system basis or using a payor-supported web browser; 4
420	420	(iii) Provide reasonably detailed information on a consumer’s eligibility for healthcare 5
421	421	coverage; scope of benefits; limitations and exclusions provided under that coverage; cost-sharing 6
422	422	requirements for specific services at the specific time of the inquiry; current deductible amounts; 7
423	423	accumulated or limited benefits; out-of-pocket maximums; any maximum policy amounts; and 8
424	424	other information required for the provider to collect the patient’s portion of the bill; 9
425	425	(iv) Reflect the necessary limitations imposed on payors by the originator of the eligibility 10
426	426	and benefits information; 11
427	427	(v) Recommend a standard or common process to protect all providers from the costs of 12
428	428	services to patients who are ineligible for insurance coverage in circumstances where a payor 13
429	429	provides eligibility verification based on best information available to the payor at the date of the 14
430	430	request of eligibility. 15
431	431	(2) Developing implementation guidelines and promoting adoption of the guidelines for: 16
432	432	(i) The use of the National Correct Coding Initiative code-edit policy by payors and 17
433	433	providers in the state; 18
434	434	(ii) Publishing any variations from codes and mutually exclusive codes by payors in a 19
435	435	manner that makes for simple retrieval and implementation by providers; 20
436	436	(iii) Use of Health Insurance Portability and Accountability Act standard group codes, 21
437	437	reason codes, and remark codes by payors in electronic remittances sent to providers; 22
438	438	(iv) Uniformity in the processing of claims by payors; and the processing of corrections to 23
439	439	claims by providers and payors; 24
440	440	(v) A standard payor-denial review process for providers when they request a 25
441	441	reconsideration of a denial of a claim that results from differences in clinical edits where no single, 26
442	442	common-standards body or process exists and multiple conflicting sources are in use by payors and 27
443	443	providers. 28
444	444	(vi) Nothing in this section, nor in the guidelines developed, shall inhibit an individual 29
445	445	payor’s ability to employ, and not disclose to providers, temporary code edits for the purpose of 30
446	446	detecting and deterring fraudulent billing activities. The guidelines shall require that each payor 31
447	447	disclose to the provider its adjudication decision on a claim that was denied or adjusted based on 32
448	448	the application of such edits and that the provider have access to the payor’s review and appeal 33
449	449	process to challenge the payor’s adjudication decision. 34
450	450
451	451
452	452	LC000724 - Page 13 of 20
453	453	(vii) Nothing in this subsection shall be construed to modify the rights or obligations of 1
454	454	payors or providers with respect to procedures relating to the investigation, reporting, appeal, or 2
455	455	prosecution under applicable law of potentially fraudulent billing activities. 3
456	456	(3) Developing and promoting widespread adoption by payors and providers of guidelines 4
457	457	to: 5
458	458	(i) Ensure payors do not automatically deny claims for services when extenuating 6
459	459	circumstances make it impossible for the provider to obtain a preauthorization before services are 7
460	460	performed or notify a payor within an appropriate standardized timeline of a patient’s admission; 8
461	461	(ii) Require payors to use common and consistent processes and time frames when 9
462	462	responding to provider requests for medical management approvals. Whenever possible, such time 10
463	463	frames shall be consistent with those established by leading national organizations and be based 11
464	464	upon the acuity of the patient’s need for care or treatment. For the purposes of this section, medical 12
465	465	management includes prior authorization of services, preauthorization of services, precertification 13
466	466	of services, post-service review, medical-necessity review, and benefits advisory; 14
467	467	(iii) Develop, maintain, and promote widespread adoption of a single, common website 15
468	468	where providers can obtain payors’ preauthorization, benefits advisory, and preadmission 16
469	469	requirements; 17
470	470	(iv) Establish guidelines for payors to develop and maintain a website that providers can 18
471	471	use to request a preauthorization, including a prospective clinical necessity review; receive an 19
472	472	authorization number; and transmit an admission notification; 20
473	473	(v) Develop and implement the use of programs that implement selective prior 21
474	474	authorization requirements, based on stratification of healthcare providers’ performance and 22
475	475	adherence to evidence-based medicine with the input of contracted healthcare providers and/or 23
476	476	provider organizations. Such criteria shall be transparent and easily accessible to contracted 24
477	477	providers. Such selective prior authorization programs shall be available when healthcare providers 25
478	478	participate directly with the insurer in risk-based payment contracts and may be available to 26
479	479	providers who do not participate in risk-based contracts; 27
480	480	(vi) Require the review of medical services, including behavioral health services, and 28
481	481	prescription drugs, subject to prior authorization on at least an annual basis, with the input of 29
482	482	contracted healthcare providers and/or provider organizations. Any changes to the list of medical 30
483	483	services, including behavioral health services, and prescription drugs requiring prior authorization, 31
484	484	shall be shared via provider-accessible websites; 32
485	485	(vii) Improve communication channels between health plans, healthcare providers, and 33
486	486	patients by: 34
487	487
488	488
489	489	LC000724 - Page 14 of 20
490	490	(A) Requiring transparency and easy accessibility of prior authorization requirements, 1
491	491	criteria, rationale, and program changes to contracted healthcare providers and patients/health plan 2
492	492	enrollees which may be satisfied by posting to provider-accessible and member-accessible 3
493	493	websites; and 4
494	494	(B) Supporting: 5
495	495	(I) Timely submission by healthcare providers of the complete information necessary to 6
496	496	make a prior authorization determination, as early in the process as possible; and 7
497	497	(II) Timely notification of prior authorization determinations by health plans to impacted 8
498	498	health plan enrollees, and healthcare providers, including, but not limited to, ordering providers, 9
499	499	and/or rendering providers, and dispensing pharmacists which may be satisfied by posting to 10
500	500	provider-accessible websites or similar electronic portals or services; 11
501	501	(viii) Increase and strengthen continuity of patient care by: 12
502	502	(A) Defining protections for continuity of care during a transition period for patients 13
503	503	undergoing an active course of treatment, when there is a formulary or treatment coverage change 14
504	504	or change of health plan that may disrupt their current course of treatment and when the treating 15
505	505	physician determines that a transition may place the patient at risk; and for prescription medication 16
506	506	by allowing a grace period of coverage to allow consideration of referred health plan options or 17
507	507	establishment of medical necessity of the current course of treatment; 18
508	508	(B) Requiring continuity of care for medical services, including behavioral health services, 19
509	509	and prescription medications for patients on appropriate, chronic, stable therapy through 20
510	510	minimizing repetitive prior authorization requirements; and which for prescription medication shall 21
511	511	be allowed only on an annual review, with exception for labeled limitation, to establish continued 22
512	512	benefit of treatment; and 23
513	513	(C) Requiring communication between healthcare providers, health plans, and patients to 24
514	514	facilitate continuity of care and minimize disruptions in needed treatment which may be satisfied 25
515	515	by posting to provider-accessible websites or similar electronic portals or services; 26
516	516	(D) Continuity of care for formulary or drug coverage shall distinguish between FDA 27
517	517	designated interchangeable products and proprietary or marketed versions of a medication; 28
518	518	(ix) Encourage healthcare providers and/or provider organizations and health plans to 29
519	519	accelerate use of electronic prior authorization technology, including adoption of national standards 30
520	520	where applicable; and 31
521	521	(x) For the purposes of subsections (h)(3)(v) through (h)(3)(x) of this section, the 32
522	522	workgroup meeting may be conducted in part or whole through electronic methods. 33
523	523	(4) To provide a report to the house and senate, on or before January 1, 2017, with 34
524	524
525	525
526	526	LC000724 - Page 15 of 20
527	527	recommendations for establishing guidelines and regulations for systems that give patients 1
528	528	electronic access to their claims information, particularly to information regarding their obligations 2
529	529	to pay for received medical services, pursuant to 45 C.F.R. § 164.524. 3
530	530	(5) No provision of this subsection (h) shall preclude the ongoing work of the office of 4
531	531	health insurance commissioner’s administrative simplification task force, which includes meetings 5
532	532	with key stakeholders in order to improve, and provide recommendations regarding, the prior 6
533	533	authorization process. 7
534	534	(i) To issue an anti-cancer medication report. Not later than June 30, 2014, and annually 8
535	535	thereafter, the office of the health insurance commissioner (OHIC) shall provide the senate 9
536	536	committee on health and human services, and the house committee on corporations, with: (1) 10
537	537	Information on the availability in the commercial market of coverage for anti-cancer medication 11
538	538	options; (2) For the state employee’s health benefit plan, the costs of various cancer-treatment 12
539	539	options; (3) The changes in drug prices over the prior thirty-six (36) months; and (4) Member 13
540	540	utilization and cost-sharing expense. 14
541	541	(j) To monitor the adequacy of each health plan’s compliance with the provisions of the 15
542	542	federal Mental Health Parity Act, including a review of related claims processing and 16
543	543	reimbursement procedures. Findings, recommendations, and assessments shall be made available 17
544	544	to the public. 18
545	545	(k) To monitor the transition from fee-for-service and toward global and other alternative 19
546	546	payment methodologies for the payment for healthcare services. Alternative payment 20
547	547	methodologies should be assessed for their likelihood to promote access to affordable health 21
548	548	insurance, health outcomes, and performance. 22
549	549	(l) To report annually, no later than July 1, 2014, then biannually thereafter, on hospital 23
550	550	payment variation, including findings and recommendations, subject to available resources. 24
551	551	(m) Notwithstanding any provision of the general or public laws or regulation to the 25
552	552	contrary, provide a report with findings and recommendations to the president of the senate and the 26
553	553	speaker of the house, on or before April 1, 2014, including, but not limited to, the following 27
554	554	information: 28
555	555	(1) The impact of the current, mandated healthcare benefits as defined in §§ 27-18-48.1, 29
556	556	27-18-60, 27-18-62, 27-18-64, similar provisions in chapters 19, 20 and 41 of title 27, and §§ 27-30
557	557	18-3(c), 27-38.2-1 et seq., or others as determined by the commissioner, on the cost of health 31
558	558	insurance for fully insured employers, subject to available resources; 32
559	559	(2) Current provider and insurer mandates that are unnecessary and/or duplicative due to 33
560	560	the existing standards of care and/or delivery of services in the healthcare system; 34
561	561
562	562
563	563	LC000724 - Page 16 of 20
564	564	(3) A state-by-state comparison of health insurance mandates and the extent to which 1
565	565	Rhode Island mandates exceed other states benefits; and 2
566	566	(4) Recommendations for amendments to existing mandated benefits based on the findings 3
567	567	in (m)(1), (m)(2), and (m)(3) above. 4
568	568	(n) On or before July 1, 2014, the office of the health insurance commissioner, in 5
569	569	collaboration with the director of health and lieutenant governor’s office, shall submit a report to 6
570	570	the general assembly and the governor to inform the design of accountable care organizations 7
571	571	(ACOs) in Rhode Island as unique structures for comprehensive healthcare delivery and value-8
572	572	based payment arrangements, that shall include, but not be limited to: 9
573	573	(1) Utilization review; 10
574	574	(2) Contracting; and 11
575	575	(3) Licensing and regulation. 12
576	576	(o) On or before February 3, 2015, the office of the health insurance commissioner shall 13
577	577	submit a report to the general assembly and the governor that describes, analyzes, and proposes 14
578	578	recommendations to improve compliance of insurers with the provisions of § 27-18-76 with regard 15
579	579	to patients with mental health and substance use disorders. 16
580	580	(p) To work to ensure the health insurance coverage of behavioral health care under the 17
581	581	same terms and conditions as other health care, and to integrate behavioral health parity 18
582	582	requirements into the office of the health insurance commissioner insurance oversight and 19
583	583	healthcare transformation efforts. 20
584	584	(q) To work with other state agencies to seek delivery system improvements that enhance 21
585	585	access to a continuum of mental health and substance use disorder treatment in the state; and 22
586	586	integrate that treatment with primary and other medical care to the fullest extent possible. 23
587	587	(r) To direct insurers toward policies and practices that address the behavioral health needs 24
588	588	of the public and greater integration of physical and behavioral healthcare delivery. 25
589	589	(s) The office of the health insurance commissioner shall conduct an analysis of the impact 26
590	590	of the provisions of § 27-38.2-1(i) on health insurance premiums and access in Rhode Island and 27
591	591	submit a report of its findings to the general assembly on or before June 1, 2023. 28
592	592	(t) To undertake the analyses, reports, and studies contained in this section: 29
593	593	(1) The office shall hire the necessary staff and prepare a request for proposal for a qualified 30
594	594	and competent firm or firms to undertake the following analyses, reports, and studies: 31
595	595	(i) The firm shall undertake a comprehensive review of all social and human service 32
596	596	programs having a contract with or licensed by the state or any subdivision of the department of 33
597	597	children, youth and families (DCYF), the department of behavioral healthcare, developmental 34
598	598
599	599
600	600	LC000724 - Page 17 of 20
601	601	disabilities and hospitals (BHDDH), the department of human services (DHS), the department of 1
602	602	health (DOH), and Medicaid for the purposes of: 2
603	603	(A) Establishing a baseline of the eligibility factors for receiving services; 3
604	604	(B) Establishing a baseline of the service offering through each agency for those 4
605	605	determined eligible; 5
606	606	(C) Establishing a baseline understanding of reimbursement rates for all social and human 6
607	607	service programs including rates currently being paid, the date of the last increase, and a proposed 7
608	608	model that the state may use to conduct future studies and analyses; 8
609	609	(D) Ensuring accurate and adequate reimbursement to social and human service providers 9
610	610	that facilitate the availability of high-quality services to individuals receiving home and 10
611	611	community-based long-term services and supports provided by social and human service providers; 11
612	612	(E) Ensuring the general assembly is provided accurate financial projections on social and 12
613	613	human service program costs, demand for services, and workforce needs to ensure access to entitled 13
614	614	beneficiaries and services; 14
615	615	(F) Establishing a baseline and determining the relationship between state government and 15
616	616	the provider network including functions, responsibilities, and duties; 16
617	617	(G) Determining a set of measures and accountability standards to be used by EOHHS and 17
618	618	the general assembly to measure the outcomes of the provision of services including budgetary 18
619	619	reporting requirements, transparency portals, and other methods; and 19
620	620	(H) Reporting the findings of human services analyses and reports to the speaker of the 20
621	621	house, senate president, chairs of the house and senate finance committees, chairs of the house and 21
622	622	senate health and human services committees, and the governor. 22
623	623	(2) The analyses, reports, and studies required pursuant to this section shall be 23
624	624	accomplished and published as follows and shall provide: 24
625	625	(i) An assessment and detailed reporting on all social and human service program rates to 25
626	626	be completed by January 1, 2023, including rates currently being paid and the date of the last 26
627	627	increase; 27
628	628	(ii) An assessment and detailed reporting on eligibility standards and processes of all 28
629	629	mandatory and discretionary social and human service programs to be completed by January 1, 29
630	630	2023; 30
631	631	(iii) An assessment and detailed reporting on utilization trends from the period of January 31
632	632	1, 2017, through December 31, 2021, for social and human service programs to be completed by 32
633	633	January 1, 2023; 33
634	634	(iv) An assessment and detailed reporting on the structure of the state government as it 34
635	635
636	636
637	637	LC000724 - Page 18 of 20
638	638	relates to the provision of services by social and human service providers including eligibility and 1
639	639	functions of the provider network to be completed by January 1, 2023; 2
640	640	(v) An assessment and detailed reporting on accountability standards for services for social 3
641	641	and human service programs to be completed by January 1, 2023; 4
642	642	(vi) An assessment and detailed reporting by April 1, 2023, on all professional licensed 5
643	643	and unlicensed personnel requirements for established rates for social and human service programs 6
644	644	pursuant to a contract or established fee schedule; 7
645	645	(vii) An assessment and reporting on access to social and human service programs, to 8
646	646	include any wait lists and length of time on wait lists, in each service category by April 1, 2023; 9
647	647	(viii) An assessment and reporting of national and regional Medicaid rates in comparison 10
648	648	to Rhode Island social and human service provider rates by April 1, 2023; 11
649	649	(ix) An assessment and reporting on usual and customary rates paid by private insurers and 12
650	650	private pay for similar social and human service providers, both nationally and regionally, by April 13
651	651	1, 2023; and 14
652	652	(x) Completion of the development of an assessment and review process that includes the 15
653	653	following components: eligibility; scope of services; relationship of social and human service 16
654	654	provider and the state; national and regional rate comparisons and accountability standards that 17
655	655	result in recommended rate adjustments; and this process shall be completed by September 1, 2023, 18
656	656	and conducted biennially hereafter. The biennial rate setting shall be consistent with payment 19
657	657	requirements established in § 1902(a)(30)(A) of the Social Security Act, 42 U.S.C. § 20
658	658	1396a(a)(30)(A), and all federal and state law, regulations, and quality and safety standards. The 21
659	659	results and findings of this process shall be transparent, and public meetings shall be conducted to 22
660	660	allow providers, recipients, and other interested parties an opportunity to ask questions and provide 23
661	661	comment beginning in September 2023 and biennially thereafter. 24
662	662	(3) In fulfillment of the responsibilities defined in subsection (t), the office of the health 25
663	663	insurance commissioner shall consult with the Executive Office of Health and Human Services. 26
664	664	(u) Annually, each department (namely, EOHHS, DCYF, DOH, DHS, and BHDDH) shall 27
665	665	include the corresponding components of the assessment and review (i.e., eligibility; scope of 28
666	666	services; relationship of social and human service provider and the state; and national and regional 29
667	667	rate comparisons and accountability standards including any changes or substantive issues between 30
668	668	biennial reviews) including the recommended rates from the most recent assessment and review 31
669	669	with their annual budget submission to the office of management and budget and provide a detailed 32
670	670	explanation and impact statement if any rate variances exist between submitted recommended 33
671	671	budget and the corresponding recommended rate from the most recent assessment and review 34
672	672
673	673
674	674	LC000724 - Page 19 of 20
675	675	process starting October 1, 2023, and biennially thereafter. 1
676	676	(v) To enforce the provisions of title 27 as set forth in § 27-83-1 through § 27-83-6. 2
677	677	(v)(w) The general assembly shall appropriate adequate funding as it deems necessary to 3
678	678	undertake the analyses, reports, and studies contained in this section relating to the powers and 4
679	679	duties of the office of the health insurance commissioner. 5
680	680	SECTION 4. This act shall take effect upon passage. 6
681	681	========
682	682	LC000724
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684	684
685	685
686	686	LC000724 - Page 20 of 20
687	687	EXPLANATION
688	688	BY THE LEGISLATIVE COUNCIL
689	689	OF
690	690	A N A C T
691	691	RELATING TO INSURANCE -- THE TRANSPARENCY AND ACCOUNTABILITY IN
692	692	ARTIFICIAL INTELLIGENCE USE BY HEALTH INSURERS TO MANAGE COVERAGE
693	693	AND CLAIMS ACT
694	694	***
695	695	This act would promote transparency and accountability in the use of artificial intelligence 1
696	696	by health insurers to manage coverage and claims. 2
697	697	This act would take effect upon passage. 3
698	698	========
699	699	LC000724
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