TX
Texas House Bill HB4167

Texas 2017 - 85th Regular

Texas House Bill HB4167 Compare Versions

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11 85R12655 KKR-D
22 By: Turner H.B. No. 4167
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55 A BILL TO BE ENTITLED
66 AN ACT
77 relating to the processing and payment of claims for reimbursement
88 by certain providers under the Medicaid program.
99 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1010 SECTION 1. Section 533.005(a), Government Code, is amended
1111 to read as follows:
1212 (a) A contract between a managed care organization and the
1313 commission for the organization to provide health care services to
1414 recipients must contain:
1515 (1) procedures to ensure accountability to the state
1616 for the provision of health care services, including procedures for
1717 financial reporting, quality assurance, utilization review, and
1818 assurance of contract and subcontract compliance;
1919 (2) capitation rates that ensure the cost-effective
2020 provision of quality health care;
2121 (3) a requirement that the managed care organization
2222 provide ready access to a person who assists recipients in
2323 resolving issues relating to enrollment, plan administration,
2424 education and training, access to services, and grievance
2525 procedures;
2626 (4) a requirement that the managed care organization
2727 provide ready access to a person who assists providers in resolving
2828 issues relating to payment, plan administration, education and
2929 training, and grievance procedures;
3030 (5) a requirement that the managed care organization
3131 provide information and referral about the availability of
3232 educational, social, and other community services that could
3333 benefit a recipient;
3434 (6) procedures for recipient outreach and education;
3535 (7) a requirement that the managed care organization
3636 make payment to a physician or provider for health care services
3737 rendered to a recipient under a managed care plan on any claim for
3838 payment that is received with documentation reasonably necessary
3939 for the managed care organization to process the claim:
4040 (A) not later than:
4141 (i) the 10th day after the date the claim is
4242 received if the claim relates to services provided by a nursing
4343 facility, intermediate care facility, or group home;
4444 (ii) the 30th day after the date the claim
4545 is received if the claim relates to the provision of long-term
4646 services and supports not subject to Subparagraph (i); and
4747 (iii) the 30th [45th] day after the date the
4848 claim is received if the claim is not subject to Subparagraph (i) or
4949 (ii); or
5050 (B) within a period, not to exceed 60 days,
5151 specified by a written agreement between the physician or provider
5252 and the managed care organization;
5353 (7-a) a requirement that the managed care organization
5454 demonstrate to the commission that the organization pays claims
5555 described by Subdivision (7)(A)(ii) on average not later than the
5656 21st day after the date the claim is received by the organization;
5757 (7-b) a requirement that the managed care organization
5858 make payment to a financial management services agency for services
5959 rendered under Section 531.051 on behalf of a recipient under a
6060 managed care plan on any claim for payment that is received with
6161 documentation reasonably necessary for the managed care
6262 organization to process the claim not later than the 30th day after
6363 the date the claim is received;
6464 (8) a requirement that the commission, on the date of a
6565 recipient's enrollment in a managed care plan issued by the managed
6666 care organization, inform the organization of the recipient's
6767 Medicaid certification date;
6868 (9) a requirement that the managed care organization
6969 comply with Section 533.006 as a condition of contract retention
7070 and renewal;
7171 (10) a requirement that the managed care organization
7272 provide the information required by Section 533.012 and otherwise
7373 comply and cooperate with the commission's office of inspector
7474 general and the office of the attorney general;
7575 (11) a requirement that the managed care
7676 organization's usages of out-of-network providers or groups of
7777 out-of-network providers may not exceed limits for those usages
7878 relating to total inpatient admissions, total outpatient services,
7979 and emergency room admissions determined by the commission;
8080 (12) if the commission finds that a managed care
8181 organization has violated Subdivision (11), a requirement that the
8282 managed care organization reimburse an out-of-network provider for
8383 health care services at a rate that is equal to the allowable rate
8484 for those services, as determined under Sections 32.028 and
8585 32.0281, Human Resources Code;
8686 (13) a requirement that, notwithstanding any other
8787 law, including Sections 843.312 and 1301.052, Insurance Code, the
8888 organization:
8989 (A) use advanced practice registered nurses and
9090 physician assistants in addition to physicians as primary care
9191 providers to increase the availability of primary care providers in
9292 the organization's provider network; and
9393 (B) treat advanced practice registered nurses
9494 and physician assistants in the same manner as primary care
9595 physicians with regard to:
9696 (i) selection and assignment as primary
9797 care providers;
9898 (ii) inclusion as primary care providers in
9999 the organization's provider network; and
100100 (iii) inclusion as primary care providers
101101 in any provider network directory maintained by the organization;
102102 (14) a requirement that the managed care organization
103103 reimburse a federally qualified health center or rural health
104104 clinic for health care services provided to a recipient outside of
105105 regular business hours, including on a weekend day or holiday, at a
106106 rate that is equal to the allowable rate for those services as
107107 determined under Section 32.028, Human Resources Code, if the
108108 recipient does not have a referral from the recipient's primary
109109 care physician;
110110 (15) a requirement that the managed care organization
111111 develop, implement, and maintain a system for tracking and
112112 resolving all provider appeals related to claims payment, including
113113 a process that will require:
114114 (A) a tracking mechanism to document the status
115115 and final disposition of each provider's claims payment appeal;
116116 (B) the contracting with physicians who are not
117117 network providers and who are of the same or related specialty as
118118 the appealing physician to resolve claims disputes related to
119119 denial on the basis of medical necessity that remain unresolved
120120 subsequent to a provider appeal;
121121 (C) the determination of the physician resolving
122122 the dispute to be binding on the managed care organization and
123123 provider; and
124124 (D) the managed care organization to allow a
125125 provider with a claim that has not been paid before the time
126126 prescribed by Subdivision (7)(A)(ii) or (7-b) to initiate an appeal
127127 of that claim;
128128 (16) a requirement that a medical director who is
129129 authorized to make medical necessity determinations is available to
130130 the region where the managed care organization provides health care
131131 services;
132132 (17) a requirement that the managed care organization
133133 ensure that a medical director and patient care coordinators and
134134 provider and recipient support services personnel are located in
135135 the South Texas service region, if the managed care organization
136136 provides a managed care plan in that region;
137137 (18) a requirement that the managed care organization
138138 provide special programs and materials for recipients with limited
139139 English proficiency or low literacy skills;
140140 (19) a requirement that the managed care organization
141141 develop and establish a process for responding to provider appeals
142142 in the region where the organization provides health care services;
143143 (20) a requirement that the managed care organization:
144144 (A) develop and submit to the commission, before
145145 the organization begins to provide health care services to
146146 recipients, a comprehensive plan that describes how the
147147 organization's provider network complies with the provider access
148148 standards established under Section 533.0061, as added by Chapter
149149 1272 (S.B. 760), Acts of the 84th Legislature, Regular Session,
150150 2015;
151151 (B) as a condition of contract retention and
152152 renewal:
153153 (i) continue to comply with the provider
154154 access standards established under Section 533.0061, as added by
155155 Chapter 1272 (S.B. 760), Acts of the 84th Legislature, Regular
156156 Session, 2015; and
157157 (ii) make substantial efforts, as
158158 determined by the commission, to mitigate or remedy any
159159 noncompliance with the provider access standards established under
160160 Section 533.0061, as added by Chapter 1272 (S.B. 760), Acts of the
161161 84th Legislature, Regular Session, 2015;
162162 (C) pay liquidated damages for each failure, as
163163 determined by the commission, to comply with the provider access
164164 standards established under Section 533.0061, as added by Chapter
165165 1272 (S.B. 760), Acts of the 84th Legislature, Regular Session,
166166 2015, in amounts that are reasonably related to the noncompliance;
167167 and
168168 (D) regularly, as determined by the commission,
169169 submit to the commission and make available to the public a report
170170 containing data on the sufficiency of the organization's provider
171171 network with regard to providing the care and services described
172172 under Section 533.0061(a), as added by Chapter 1272 (S.B. 760),
173173 Acts of the 84th Legislature, Regular Session, 2015, and specific
174174 data with respect to access to primary care, specialty care,
175175 long-term services and supports, nursing services, and therapy
176176 services on the average length of time between:
177177 (i) the date a provider requests prior
178178 authorization for the care or service and the date the organization
179179 approves or denies the request; and
180180 (ii) the date the organization approves a
181181 request for prior authorization for the care or service and the date
182182 the care or service is initiated;
183183 (21) a requirement that the managed care organization
184184 demonstrate to the commission, before the organization begins to
185185 provide health care services to recipients, that, subject to the
186186 provider access standards established under Section 533.0061, as
187187 added by Chapter 1272 (S.B. 760), Acts of the 84th Legislature,
188188 Regular Session, 2015:
189189 (A) the organization's provider network has the
190190 capacity to serve the number of recipients expected to enroll in a
191191 managed care plan offered by the organization;
192192 (B) the organization's provider network
193193 includes:
194194 (i) a sufficient number of primary care
195195 providers;
196196 (ii) a sufficient variety of provider
197197 types;
198198 (iii) a sufficient number of providers of
199199 long-term services and supports and specialty pediatric care
200200 providers of home and community-based services; and
201201 (iv) providers located throughout the
202202 region where the organization will provide health care services;
203203 and
204204 (C) health care services will be accessible to
205205 recipients through the organization's provider network to a
206206 comparable extent that health care services would be available to
207207 recipients under a fee-for-service or primary care case management
208208 model of Medicaid managed care;
209209 (22) a requirement that the managed care organization
210210 develop a monitoring program for measuring the quality of the
211211 health care services provided by the organization's provider
212212 network that:
213213 (A) incorporates the National Committee for
214214 Quality Assurance's Healthcare Effectiveness Data and Information
215215 Set (HEDIS) measures;
216216 (B) focuses on measuring outcomes; and
217217 (C) includes the collection and analysis of
218218 clinical data relating to prenatal care, preventive care, mental
219219 health care, and the treatment of acute and chronic health
220220 conditions and substance abuse;
221221 (23) subject to Subsection (a-1), a requirement that
222222 the managed care organization develop, implement, and maintain an
223223 outpatient pharmacy benefit plan for its enrolled recipients:
224224 (A) that exclusively employs the vendor drug
225225 program formulary and preserves the state's ability to reduce
226226 waste, fraud, and abuse under Medicaid;
227227 (B) that adheres to the applicable preferred drug
228228 list adopted by the commission under Section 531.072;
229229 (C) that includes the prior authorization
230230 procedures and requirements prescribed by or implemented under
231231 Sections 531.073(b), (c), and (g) for the vendor drug program;
232232 (D) for purposes of which the managed care
233233 organization:
234234 (i) may not negotiate or collect rebates
235235 associated with pharmacy products on the vendor drug program
236236 formulary; and
237237 (ii) may not receive drug rebate or pricing
238238 information that is confidential under Section 531.071;
239239 (E) that complies with the prohibition under
240240 Section 531.089;
241241 (F) under which the managed care organization may
242242 not prohibit, limit, or interfere with a recipient's selection of a
243243 pharmacy or pharmacist of the recipient's choice for the provision
244244 of pharmaceutical services under the plan through the imposition of
245245 different copayments;
246246 (G) that allows the managed care organization or
247247 any subcontracted pharmacy benefit manager to contract with a
248248 pharmacist or pharmacy providers separately for specialty pharmacy
249249 services, except that:
250250 (i) the managed care organization and
251251 pharmacy benefit manager are prohibited from allowing exclusive
252252 contracts with a specialty pharmacy owned wholly or partly by the
253253 pharmacy benefit manager responsible for the administration of the
254254 pharmacy benefit program; and
255255 (ii) the managed care organization and
256256 pharmacy benefit manager must adopt policies and procedures for
257257 reclassifying prescription drugs from retail to specialty drugs,
258258 and those policies and procedures must be consistent with rules
259259 adopted by the executive commissioner and include notice to network
260260 pharmacy providers from the managed care organization;
261261 (H) under which the managed care organization may
262262 not prevent a pharmacy or pharmacist from participating as a
263263 provider if the pharmacy or pharmacist agrees to comply with the
264264 financial terms and conditions of the contract as well as other
265265 reasonable administrative and professional terms and conditions of
266266 the contract;
267267 (I) under which the managed care organization may
268268 include mail-order pharmacies in its networks, but may not require
269269 enrolled recipients to use those pharmacies, and may not charge an
270270 enrolled recipient who opts to use this service a fee, including
271271 postage and handling fees;
272272 (J) under which the managed care organization or
273273 pharmacy benefit manager, as applicable, must pay claims in
274274 accordance with Section 843.339, Insurance Code; and
275275 (K) under which the managed care organization or
276276 pharmacy benefit manager, as applicable:
277277 (i) to place a drug on a maximum allowable
278278 cost list, must ensure that:
279279 (a) the drug is listed as "A" or "B"
280280 rated in the most recent version of the United States Food and Drug
281281 Administration's Approved Drug Products with Therapeutic
282282 Equivalence Evaluations, also known as the Orange Book, has an "NR"
283283 or "NA" rating or a similar rating by a nationally recognized
284284 reference; and
285285 (b) the drug is generally available
286286 for purchase by pharmacies in the state from national or regional
287287 wholesalers and is not obsolete;
288288 (ii) must provide to a network pharmacy
289289 provider, at the time a contract is entered into or renewed with the
290290 network pharmacy provider, the sources used to determine the
291291 maximum allowable cost pricing for the maximum allowable cost list
292292 specific to that provider;
293293 (iii) must review and update maximum
294294 allowable cost price information at least once every seven days to
295295 reflect any modification of maximum allowable cost pricing;
296296 (iv) must, in formulating the maximum
297297 allowable cost price for a drug, use only the price of the drug and
298298 drugs listed as therapeutically equivalent in the most recent
299299 version of the United States Food and Drug Administration's
300300 Approved Drug Products with Therapeutic Equivalence Evaluations,
301301 also known as the Orange Book;
302302 (v) must establish a process for
303303 eliminating products from the maximum allowable cost list or
304304 modifying maximum allowable cost prices in a timely manner to
305305 remain consistent with pricing changes and product availability in
306306 the marketplace;
307307 (vi) must:
308308 (a) provide a procedure under which a
309309 network pharmacy provider may challenge a listed maximum allowable
310310 cost price for a drug;
311311 (b) respond to a challenge not later
312312 than the 15th day after the date the challenge is made;
313313 (c) if the challenge is successful,
314314 make an adjustment in the drug price effective on the date the
315315 challenge is resolved, and make the adjustment applicable to all
316316 similarly situated network pharmacy providers, as determined by the
317317 managed care organization or pharmacy benefit manager, as
318318 appropriate;
319319 (d) if the challenge is denied,
320320 provide the reason for the denial; and
321321 (e) report to the commission every 90
322322 days the total number of challenges that were made and denied in the
323323 preceding 90-day period for each maximum allowable cost list drug
324324 for which a challenge was denied during the period;
325325 (vii) must notify the commission not later
326326 than the 21st day after implementing a practice of using a maximum
327327 allowable cost list for drugs dispensed at retail but not by mail;
328328 and
329329 (viii) must provide a process for each of
330330 its network pharmacy providers to readily access the maximum
331331 allowable cost list specific to that provider;
332332 (24) a requirement that the managed care organization
333333 and any entity with which the managed care organization contracts
334334 for the performance of services under a managed care plan disclose,
335335 at no cost, to the commission and, on request, the office of the
336336 attorney general all discounts, incentives, rebates, fees, free
337337 goods, bundling arrangements, and other agreements affecting the
338338 net cost of goods or services provided under the plan;
339339 (25) a requirement that the managed care organization
340340 not implement significant, nonnegotiated, across-the-board
341341 provider reimbursement rate reductions unless:
342342 (A) subject to Subsection (a-3), the
343343 organization has the prior approval of the commission to make the
344344 reduction; or
345345 (B) the rate reductions are based on changes to
346346 the Medicaid fee schedule or cost containment initiatives
347347 implemented by the commission; and
348348 (26) a requirement that the managed care organization
349349 make initial and subsequent primary care provider assignments and
350350 changes.
351351 SECTION 2. Subchapter A, Chapter 533, Government Code, is
352352 amended by adding Section 533.005511 to read as follows:
353353 Sec. 533.005511. CANCELLATION OF CONTRACT FOR LATE PAYMENT
354354 OF CERTAIN CLAIMS. (a) If a managed care organization repeatedly
355355 fails to pay a claim on or before the 15th day after the date the
356356 time limit for payment of the claim prescribed by Section
357357 533.005(a)(7) or (7-b) expires, the executive commissioner may
358358 cancel the commission's contract with the managed care
359359 organization.
360360 (b) The executive commissioner shall adopt rules
361361 establishing the conditions under which the commission may cancel a
362362 contract with a managed care organization and a process for
363363 canceling the contract under this section.
364364 SECTION 3. The executive commissioner of the Health and
365365 Human Services Commission shall adopt the rules necessary to
366366 implement Section 533.005511, Government Code, as added by this
367367 Act, not later than December 31, 2017.
368368 SECTION 4. (a) The Health and Human Services Commission, in
369369 a contract between the commission and a managed care organization
370370 under Chapter 533, Government Code, that is entered into or renewed
371371 on or after the effective date of this Act, shall require that the
372372 managed care organization comply with Section 533.005(a)(7),
373373 Government Code, as amended by this Act, and Section
374374 533.005(a)(7-b), Government Code, as added by this Act.
375375 (b) The Health and Human Services Commission shall seek to
376376 amend contracts entered into with managed care organizations under
377377 Chapter 533, Government Code, before the effective date of this Act
378378 to require that those managed care organizations comply with
379379 Section 533.005(a)(7), Government Code, as amended by this Act, and
380380 Section 533.005(a)(7-b), Government Code, as added by this Act. To
381381 the extent of a conflict between those provisions and a provision of
382382 a contract with a managed care organization entered into before the
383383 effective date of this Act, the contract provision prevails.
384384 SECTION 5. Section 533.005511, Government Code, as added by
385385 this Act, applies only to a contract between the Health and Human
386386 Services Commission and a managed care organization entered into on
387387 or after the effective date of this Act.
388388 SECTION 6. If before implementing any provision of this Act
389389 a state agency determines that a waiver or authorization from a
390390 federal agency is necessary for implementation of that provision,
391391 the agency affected by the provision shall request the waiver or
392392 authorization and may delay implementing that provision until the
393393 waiver or authorization is granted.
394394 SECTION 7. This Act takes effect September 1, 2017.