83R2897 ADM-D
By: Martinez H.B. No. 1088
A BILL TO BE ENTITLED
AN ACT
relating to consumer protection provisions applicable to Medicaid
managed care contracts.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 533.003(a), Government Code, is amended
to read as follows:
(a) In awarding contracts to managed care organizations,
the commission shall:
(1) give preference to organizations that have
significant participation in the organization's provider network
from each health care provider in the region who has traditionally
provided care to Medicaid and charity care patients;
(2) give extra consideration to organizations that
agree to assure continuity of care for at least three months beyond
the period of Medicaid eligibility for recipients;
(3) consider the need to use different managed care
plans to meet the needs of different populations;
(4) consider the ability of organizations to process
Medicaid claims electronically; [and]
(5) in the initial implementation of managed care in
the South Texas service region, give extra consideration to an
organization that either:
(A) is locally owned, managed, and operated, if
one exists; or
(B) is in compliance with the requirements of
Section 533.004; and
(6) require an organization to provide the commission
with a history of reductions in reimbursement rates and covered
health care services made by the organization, and consider this
history in determining the quality of the proposal for a contract.
SECTION 2. Section 533.005(a), Government Code, is amended
to read as follows:
(a) A contract between a managed care organization and the
commission for the organization to provide health care services to
recipients must contain:
(1) procedures to ensure accountability to the state
for the provision of health care services, including procedures for
financial reporting, quality assurance, utilization review, and
assurance of contract and subcontract compliance;
(2) capitation rates that ensure the cost-effective
provision of quality health care;
(3) a requirement that the managed care organization
provide ready access to a person who assists recipients in
resolving issues relating to enrollment, plan administration,
education and training, access to services, and grievance
procedures;
(4) a requirement that the managed care organization
provide ready access to a person who assists providers in resolving
issues relating to payment, plan administration, education and
training, and grievance procedures;
(5) a requirement that the managed care organization
provide information and referral about the availability of
educational, social, and other community services that could
benefit a recipient;
(6) procedures for recipient outreach and education;
(7) a requirement that the managed care organization
make payment to a physician or provider for health care services
rendered to a recipient under a managed care plan not later than the
45th day after the date a claim for payment is received with
documentation reasonably necessary for the managed care
organization to process the claim, or within a period, not to exceed
60 days, specified by a written agreement between the physician or
provider and the managed care organization;
(8) a requirement that the commission, on the date of a
recipient's enrollment in a managed care plan issued by the managed
care organization, inform the organization of the recipient's
Medicaid certification date;
(9) a requirement that the managed care organization
comply with Section 533.006 as a condition of contract retention
and renewal;
(10) a requirement that the managed care organization
provide the information required by Section 533.012 and otherwise
comply and cooperate with the commission's office of inspector
general and the office of the attorney general;
(11) a requirement that the managed care
organization's usages of out-of-network providers or groups of
out-of-network providers may not exceed limits for those usages
relating to total inpatient admissions, total outpatient services,
and emergency room admissions determined by the commission;
(12) if the commission finds that a managed care
organization has violated Subdivision (11), a requirement that the
managed care organization reimburse an out-of-network provider for
health care services at a rate that is equal to the allowable rate
for those services, as determined under Sections 32.028 and
32.0281, Human Resources Code;
(13) a requirement that the organization use advanced
practice nurses in addition to physicians as primary care providers
to increase the availability of primary care providers in the
organization's provider network;
(14) a requirement that the managed care organization
reimburse a federally qualified health center or rural health
clinic for health care services provided to a recipient outside of
regular business hours, including on a weekend day or holiday, at a
rate that is equal to the allowable rate for those services as
determined under Section 32.028, Human Resources Code, if the
recipient does not have a referral from the recipient's primary
care physician;
(15) a requirement that the managed care organization
develop, implement, and maintain a system for tracking and
resolving all provider appeals related to claims payment, including
a process that will require:
(A) a tracking mechanism to document the status
and final disposition of each provider's claims payment appeal;
(B) the contracting with physicians who are not
network providers and who are of the same or related specialty as
the appealing physician to resolve claims disputes related to
denial on the basis of medical necessity that remain unresolved
subsequent to a provider appeal; and
(C) the determination of the physician resolving
the dispute to be binding on the managed care organization and
provider;
(16) a requirement that a medical director who is
authorized to make medical necessity determinations is available to
the region where the managed care organization provides health care
services;
(17) a requirement that the managed care organization
ensure that a medical director and patient care coordinators and
provider and recipient support services personnel are located in
the South Texas service region, if the managed care organization
provides a managed care plan in that region;
(18) a requirement that the managed care organization
provide special programs and materials for recipients with limited
English proficiency or low literacy skills;
(19) a requirement that the managed care organization
develop and establish a process for responding to provider appeals
in the region where the organization provides health care services;
(20) a requirement that the managed care organization
develop and submit to the commission, before the organization
begins to provide health care services to recipients, a
comprehensive plan that describes how the organization's provider
network will provide recipients sufficient access to:
(A) preventive care;
(B) primary care;
(C) specialty care;
(D) after-hours urgent care; and
(E) chronic care;
(21) a requirement that the managed care organization
demonstrate to the commission, before the organization begins to
provide health care services to recipients, that:
(A) the organization's provider network has the
capacity to serve the number of recipients expected to enroll in a
managed care plan offered by the organization;
(B) the organization's provider network
includes:
(i) a sufficient number of primary care
providers;
(ii) a sufficient variety of provider
types; and
(iii) providers located throughout the
region where the organization will provide health care services;
and
(C) health care services will be accessible to
recipients through the organization's provider network to a
comparable extent that health care services would be available to
recipients under a fee-for-service or primary care case management
model of Medicaid managed care;
(22) a requirement that the managed care organization
develop a monitoring program for measuring the quality of the
health care services provided by the organization's provider
network that:
(A) incorporates the National Committee for
Quality Assurance's Healthcare Effectiveness Data and Information
Set (HEDIS) measures;
(B) focuses on measuring outcomes; and
(C) includes the collection and analysis of
clinical data relating to prenatal care, preventive care, mental
health care, and the treatment of acute and chronic health
conditions and substance abuse;
(23) subject to Subsection (a-1), a requirement that
the managed care organization develop, implement, and maintain an
outpatient pharmacy benefit plan for its enrolled recipients:
(A) that exclusively employs the vendor drug
program formulary and preserves the state's ability to reduce
waste, fraud, and abuse under the Medicaid program;
(B) that adheres to the applicable preferred drug
list adopted by the commission under Section 531.072;
(C) that includes the prior authorization
procedures and requirements prescribed by or implemented under
Sections 531.073(b), (c), and (g) for the vendor drug program;
(D) for purposes of which the managed care
organization:
(i) may not negotiate or collect rebates
associated with pharmacy products on the vendor drug program
formulary; and
(ii) may not receive drug rebate or pricing
information that is confidential under Section 531.071;
(E) that complies with the prohibition under
Section 531.089;
(F) under which the managed care organization may
not prohibit, limit, or interfere with a recipient's selection of a
pharmacy or pharmacist of the recipient's choice for the provision
of pharmaceutical services under the plan through the imposition of
different copayments;
(G) that allows the managed care organization or
any subcontracted pharmacy benefit manager to contract with a
pharmacist or pharmacy providers separately for specialty pharmacy
services, except that:
(i) the managed care organization and
pharmacy benefit manager are prohibited from allowing exclusive
contracts with a specialty pharmacy owned wholly or partly by the
pharmacy benefit manager responsible for the administration of the
pharmacy benefit program; and
(ii) the managed care organization and
pharmacy benefit manager must adopt policies and procedures for
reclassifying prescription drugs from retail to specialty drugs,
and those policies and procedures must be consistent with rules
adopted by the executive commissioner and include notice to network
pharmacy providers from the managed care organization;
(H) under which the managed care organization may
not prevent a pharmacy or pharmacist from participating as a
provider if the pharmacy or pharmacist agrees to comply with the
financial terms and conditions of the contract as well as other
reasonable administrative and professional terms and conditions of
the contract;
(I) under which the managed care organization may
include mail-order pharmacies in its networks, but may not require
enrolled recipients to use those pharmacies, and may not charge an
enrolled recipient who opts to use this service a fee, including
postage and handling fees; and
(J) under which the managed care organization or
pharmacy benefit manager, as applicable, must pay claims in
accordance with Section 843.339, Insurance Code; [and]
(24) a requirement that the managed care organization
and any entity with which the managed care organization contracts
for the performance of services under a managed care plan disclose,
at no cost, to the commission and, on request, the office of the
attorney general all discounts, incentives, rebates, fees, free
goods, bundling arrangements, and other agreements affecting the
net cost of goods or services provided under the plan;
(25) a requirement that the managed care organization
not reduce reimbursement rates or covered services, including
value-added services, during the first year that the managed care
organization begins providing health care services to enrollees
under the contract;
(26) a requirement that the managed care organization
notify enrollees by certified mail of any reimbursement rate or
covered service reduction not later than the 61st day before the
date the reduction will take effect and advise those enrollees of
the right to change to a different managed care plan, subject to
Section 533.0076, and the necessary steps to do so; and
(27) a requirement that a managed care organization
restore reimbursement rates and services to the levels in effect at
the beginning of the contract term before the managed care
organization will be permitted to expand to other areas of the state
or receive any state-paid capitation rate or other premium
increases.
SECTION 3. Section 533.003(a), Government Code, as amended
by this Act, applies only to a proposal for a contract submitted by
a managed care organization on or after September 1, 2013. A
proposal for a contract submitted before that date is governed by
the law in effect on the date the proposal was submitted, and that
law is continued in effect for that purpose.
SECTION 4. (a) The Health and Human Services Commission
shall, in a contract between the commission and a managed care
organization under Chapter 533, Government Code, that is entered
into or renewed on or after the effective date of this Act, require
that the managed care organization comply with Section 533.005(a),
Government Code, as amended by this Act.
(b) The Health and Human Services Commission shall seek to
amend contracts entered into with managed care organizations under
Chapter 533, Government Code, before the effective date of this Act
to require those managed care organizations to comply with Section
533.005(a), Government Code, as amended by this Act. To the extent
of a conflict between that section and a provision of a contract
with a managed care organization entered into before the effective
date of this Act, the contract provision prevails.
SECTION 5. If before implementing any provision of this Act
a state agency determines that a waiver or authorization from a
federal agency is necessary for implementation of that provision,
the agency affected by the provision shall request the waiver or
authorization and may delay implementing that provision until the
waiver or authorization is granted.
SECTION 6. This Act takes effect immediately if it receives
a vote of two-thirds of all the members elected to each house, as
provided by Section 39, Article III, Texas Constitution. If this
Act does not receive the vote necessary for immediate effect, this
Act takes effect September 1, 2013.