Tennessee 2025-2026 Regular Session

Tennessee House Bill HB0019 Compare Versions

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

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2	2	<BillNo> <Sponsor>
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4	4	HOUSE BILL 19
5	5	By Baum
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7	7
8	8	HB0019
9	9	000492
10	10	- 1 -
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12	12	AN ACT to amend Tennessee Code Annotated, Title 8,
13	13	Chapter 27 and Title 56, Chapter 7, Part 6, relative
14	14	to covered persons insured under state healthcare
15	15	plans.
16	16
17	17	BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF TENNESSEE:
18	18	SECTION 1. This act is known and may be cited as the "Tennessee State Healthcare
19	19	Cost Savings Incentive Program."
20	20	SECTION 2. Tennessee Code Annotated, Title 56, Chapter 7, Part 6, is amended by
21	21	adding the following as a new section:
22	22	56-7-611.
23	23	(a) As used in this section:
24	24	(1) "Committees" has the same meaning as defined in § 8-27-101;
25	25	(2) "Enrollee" means an individual who is insured under a state
26	26	healthcare plan;
27	27	(3) "Healthcare services and providers" includes services and providers
28	28	within and outside of this state;
29	29	(4) "State healthcare plan" or "plan" means the group insurance plans
30	30	offered under title 8, chapter 27; and
31	31	(5) "Third-party vendor":
32	32	(A) Means a business entity with:
33	33	(i) A minimum of four (4) years of experience delivering
34	34	transparency and shared savings programs to a state employee or
35	35	healthcare plan with at least one hundred fifty thousand (150,000)
36	36	subscribers;
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41	41	(ii) A demonstrated positive return on investment for state
42	42	clients with at least one hundred fifty thousand (150,000)
43	43	subscribers;
44	44	(iii) The ability to deliver shared savings programs for
45	45	healthcare services and providers and medical and prescription
46	46	drug benefits;
47	47	(iv) At least fifteen (15) years of experience delivering cost
48	48	and quality shopping tools; and
49	49	(v) The ability to aggregate and provide cost and quality
50	50	ratings for applicable shoppable services to enrollees; and
51	51	(B) Does not include a third-party administrator of the plan.
52	52	(b)
53	53	(1) The committees shall establish an incentive program in accordance
54	54	with this section no later than January 1, 2026, to be administered by a third-
55	55	party vendor selected under subdivision (c)(1). In establishing the incentive
56	56	program, such committees shall work with the third-party vendor with which the
57	57	department of finance and administration has entered into a contract to provide
58	58	incentives through the incentive program.
59	59	(2) The committees shall require the third-party vendor to provide each
60	60	enrollee with online information on the cost and quality of healthcare services
61	61	and providers, allow an enrollee to shop for healthcare services and providers,
62	62	and reward the enrollee by sharing savings generated by the enrollee's choice of
63	63	healthcare services or providers. Each contract with such third-party vendor
64	64	must require the vendor to:
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69	69	(A) Establish an internet-based, consumer-friendly platform that
70	70	educates and informs enrollees about the price and quality of healthcare
71	71	services and providers, including the average amount paid in each county
72	72	for healthcare services and providers. The average amounts paid for
73	73	such services and providers must, where appropriate, be expressed for
74	74	service bundles, which include all products and services associated with
75	75	a particular treatment or episode of care, or for separate and distinct
76	76	products and services;
77	77	(B) Allow enrollees to shop for healthcare services and providers
78	78	using the price and quality information provided on the internet-based
79	79	platform;
80	80	(C) Permit an agent of the third-party vendor to provide
81	81	educational materials and counseling to enrollees regarding the internet-
82	82	based platform and the costs of healthcare services and providers; and
83	83	(D) Identify the cost savings realized to the enrollee and this state
84	84	if the enrollee chooses high-quality, lower-cost healthcare services or
85	85	providers, and facilitate a shared cost savings payment to the enrollee.
86	86	The amount of shared cost savings must be determined by a
87	87	methodology established by the third-party vendor and the department of
88	88	finance and administration, in collaboration with the committees, that
89	89	must maximize value-based purchasing by enrollees based on historical
90	90	claims data. At the discretion of the enrollee, the amount payable to the
91	91	enrollee may be:
92	92	(i) Credited to a qualified flexible or health benefits or
93	93	savings account offered to an enrollee under a healthcare plan; or
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98	98	(ii) Paid as a cash reimbursement by direct deposit, check,
99	99	or other similar payment method.
100	100	(3) The costs to the third-party vendor for administering the incentive
101	101	program must be paid to the third-party vendor out of the cost savings realized
102	102	under the incentive program.
103	103	(c) The department of finance and administration shall:
104	104	(1) Contract with a third-party vendor for the incentive program
105	105	established under this section in accordance with applicable state procurement
106	106	requirements; and
107	107	(2) Provide notice to each enrollee, not less than quarterly each year, of
108	108	the incentive program established under this section, including a brief description
109	109	of the program, and the contact information of the third-party vendor for purposes
110	110	of obtaining counseling and pricing in accordance with subdivision (b)(2)(C).
111	111	(d) Enrollees are eligible to receive an incentive under the incentive program for
112	112	in-network or out-of-network healthcare services and providers if such services and
113	113	providers meet the cost-effective criteria established under the incentive program.
114	114	(e) The committees, in collaboration with the third-party vendor of the incentive
115	115	program, shall submit an annual report to the speakers of the senate and the house of
116	116	representatives, the chair of the state and local government committee of the senate, the
117	117	chair of the committee of the house of representatives with subject matter jurisdiction
118	118	over state government, the chair of the commerce and labor committee of the senate,
119	119	and the chair of the committee of the house of representatives with subject matter
120	120	jurisdiction over insurance. The report must identify the number of enrollees
121	121	participating in the incentive program and the cost savings to the state healthcare plan
122	122	as a result of the implementation of the incentive program. The report must be
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127	127	submitted no later than March 15, 2027, and no later than March 15 of each year
128	128	thereafter.
129	129	(f) The third-party vendor of the incentive program shall:
130	130	(1) Administer the incentive program created under this section;
131	131	(2) Compile a list from which an enrollee may choose high-quality, lower-
132	132	cost healthcare services and providers. In compiling the list, the third-party
133	133	vendor shall:
134	134	(A) Consider the availability and necessity of such services and
135	135	providers, and the variance in cost of such services and providers, in a
136	136	manner to maximize cost savings under the incentive program; and
137	137	(B) Maintain and routinely update such list on its internet website;
138	138	and
139	139	(3) Make one (1) or more agents available to counsel enrollees on the
140	140	incentive program and available healthcare services and providers for purposes
141	141	of maximizing cost savings.
142	142	(g) Consistent with the intent of this act, and to encourage competition in the
143	143	healthcare industry to achieve cost savings for this state and for enrollees in the state
144	144	healthcare plan, the department of finance and administration shall promulgate rules
145	145	reasonably necessary to carry out this section in accordance with the Uniform
146	146	Administrative Procedures Act, compiled in title 4, chapter 5.
147	147	SECTION 3. Tennessee Code Annotated, Section 56-7-603(a)(1), is amended by
148	148	deleting "Beginning upon approval of the next health insurance rate filing on or after January 1,
149	149	2021" and substituting "In addition to the incentives provided under § 56-7-611, beginning upon
150	150	approval of the next health insurance rate filing on or after January 1, 2021"; and is amended by
151	151	deleting the language "§ 56-7-610" and substituting "§§ 56-7-610 and 56-7-611".
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156	156	SECTION 4. Tennessee Code Annotated, Section 56-7-603(a)(2), is amended by
157	157	deleting the language "§ 56-7-610" and substituting "§§ 56-7-610 and 56-7-611".
158	158	SECTION 5. Tennessee Code Annotated, Section 56-7-609(a), is amended by deleting
159	159	"in any year" and substituting "in a year; provided, that this limitation does not apply to the
160	160	incentive program required under § 56-7-611".
161	161	SECTION 6. For purposes of promulgating rules and carrying out administrative duties
162	162	necessary to effectuate this act, this act takes effect upon becoming a law, the public welfare
163	163	requiring it. For all other purposes, this act takes effect on January 1, 2026, the public welfare
164	164	requiring it, and applies to state healthcare plans issued, delivered, entered into, amended, or
165	165	renewed on or after that date.