Bill Text: IA SF2259 | 2017-2018 | 87th General Assembly | Introduced


Bill Title: A bill for an act relating to Medicaid managed care, including process and contract requirements, and oversight.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Introduced - Dead) 2018-02-13 - Subcommittee: Chelgren, Mathis, and Segebart. S.J. 307. [SF2259 Detail]

Download: Iowa-2017-SF2259-Introduced.html

Senate File 2259 - Introduced




                                 SENATE FILE       
                                 BY  PETERSEN

                                      A BILL FOR

  1 An Act relating to Medicaid managed care, including process and
  2    contract requirements, and oversight.
  3 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
    TLSB 6049XS (8) 87
    pf/rh

PAG LIN



  1  1    Section 1.  MEDICAID MANAGED CARE ==== PROCESS AND CONTRACT
  1  2 REQUIREMENTS ==== OVERSIGHT.  The department of human services
  1  3 shall adopt rules pursuant to chapter 17A and shall amend all
  1  4 Medicaid managed care contracts to provide for all of the
  1  5 following relative to managed care organizations under contract
  1  6 with the state:
  1  7    1.  Upon request by a Medicaid provider, the department
  1  8 shall provide accurate and uniform patient encounter data to
  1  9 a Medicaid provider, under contract with the managed care
  1 10 organization, within sixty calendar days of the request. The
  1 11 provision of the patient encounter data shall comply with the
  1 12 federal Health Insurance Portability and Accountability Act
  1 13 and any other applicable federal and state laws and regulatory
  1 14 requirements and shall include but not be limited to the
  1 15 managed care organization's claim number, the Medicaid member
  1 16 identification number, the Medicaid member's name, the type of
  1 17 claim, the amount billed by revenue code and procedure code,
  1 18 the managed care organization's paid amount and payment date,
  1 19 and the hospital patient account number, as applicable.  The
  1 20 department may charge a reasonable fee for the actual cost of
  1 21 providing the patient encounter data to a Medicaid provider.
  1 22    2.  A managed care organization shall provide documentation
  1 23 to a Medicaid provider claimant when the managed care
  1 24 organization contests or denies a claim, in whole or in part,
  1 25 within fifteen calendar days after receipt of the claim.  The
  1 26 documentation shall, with as much specificity as possible,
  1 27 identify the claim or portion of the claim affected, and shall
  1 28 provide an explanation including the reasons for contesting
  1 29 or denying the claim utilizing the federal Health Insurance
  1 30 Portability and Accountability Act standard claim adjustment
  1 31 reason codes and remittance advice remark codes, or other
  1 32 standard adjustment reasons and remark codes approved by rule
  1 33 of the department. A managed care organization shall utilize
  1 34 the standard coding and format of responses, established
  1 35 uniformly across all managed care organizations, as required
  2  1 by rule of the department.  A managed care organization shall
  2  2 offer quarterly in=person training on claim adjustment reason
  2  3 codes and remark codes required by the department and utilized
  2  4 by the managed care organization.
  2  5    3.  A managed care organization shall offer quarterly
  2  6 in=person education regarding billing guidelines, reimbursement
  2  7 requirements, and program policies and procedures utilizing a
  2  8 format approved by the department and incorporating information
  2  9 collected through surveys of Medicaid providers.
  2 10    4.  The department shall develop and require utilization of
  2 11 uniform standards by all managed care organizations applicable
  2 12 to all of the following:
  2 13    a.  A standardized enrollment form and a uniform process for
  2 14 credentialing and recredentialing Medicaid providers.
  2 15    b.  Procedures, requirements, and periodic reviews
  2 16 and reporting of reductions in and limitations for prior
  2 17 authorization relative to services and prescriptions.
  2 18    c.  Retrospective utilization review of hospital
  2 19 readmissions that complies with any applicable federal law
  2 20 or regulatory requirements, prohibiting such reviews for a
  2 21 Medicaid member who is readmitted with a related medical
  2 22 condition as an inpatient to a hospital more than fifteen
  2 23 calendar days after the Medicaid member's discharge from the
  2 24 hospital.
  2 25    d.  A requirement that a managed care organization, within
  2 26 sixty calendar days of receiving an appeal request, provides
  2 27 notice and resolves one hundred percent of provider appeals,
  2 28 subject to remedies, including but not limited to liquidated
  2 29 damages, if such appeals are not resolved within the required
  2 30 time frame.
  2 31    5.  The department shall enter into a contract with an
  2 32 independent auditor for the purpose of reviewing, at least once
  2 33 each calendar year, a random sample of all claims paid and
  2 34 denied by each managed care organization and each managed care
  2 35 organization's subcontractors.  Each managed care organization
  3  1 and each managed care organization's subcontractors shall
  3  2 pay any claim that the independent auditor determines to be
  3  3 incorrectly denied, any applicable liquidated damages, and any
  3  4 costs attributable to the annual audit.
  3  5    6.  A managed care organization shall pay one hundred percent
  3  6 of the state=established per diem rate to nursing facilities
  3  7 for those nursing facility residents enrolled in Medicaid
  3  8 during any recredentialing process caused by a change in
  3  9 ownership of the nursing facility.
  3 10    7.  A managed care organization shall not discriminate
  3 11 against any licensed pharmacy or pharmacist located within the
  3 12 geographic coverage area of the managed care organization that
  3 13 is willing to meet the conditions for participating established
  3 14 by the department and to accept reasonable contract terms
  3 15 offered by the managed care organization.
  3 16    Sec. 2.  MEDICAID MANAGED CARE ORGANIZATION APPEALS PROCESS
  3 17 == EXTERNAL REVIEW.
  3 18    1.  a.  A Medicaid managed care organization under contract
  3 19 with the state shall include in any written response to
  3 20 a Medicaid provider under contract with the managed care
  3 21 organization that reflects a final adverse determination of the
  3 22 managed care organization's internal appeal process relative to
  3 23 an appeal filed by the Medicaid provider, all of the following:
  3 24    (1)  A statement that the Medicaid provider's internal
  3 25 appeal rights within the managed care organization have been
  3 26 exhausted.
  3 27    (2)  A statement that the Medicaid provider is entitled to
  3 28 an external independent third=party review pursuant to this
  3 29 section.
  3 30    (3)  The requirements for requesting an external independent
  3 31 third=party review.
  3 32    b.  If a managed care organization's written response does
  3 33 not comply with the requirements of paragraph "a", the managed
  3 34 care organization shall pay to the affected Medicaid provider a
  3 35 penalty not to exceed one thousand dollars.
  4  1    2.  a.  A Medicaid provider who has been denied the provision
  4  2 of a service to a Medicaid member or a claim for reimbursement
  4  3 for a service rendered to a Medicaid member, and who has
  4  4 exhausted the internal appeals process of a managed care
  4  5 organization, shall be entitled to an external independent
  4  6 third=party review of the managed care organization's final
  4  7 adverse determination.
  4  8    b.  To request an external independent third=party review of
  4  9 a final adverse determination by a managed care organization,
  4 10 an aggrieved Medicaid provider shall submit a written request
  4 11 for such review to the managed care organization within sixty
  4 12 calendar days of receiving the final adverse determination.
  4 13    c.  A Medicaid provider's request for such review shall
  4 14 include all of the following:
  4 15    (1)  Identification of  each specific issue and dispute
  4 16 directly related to the final adverse determination issued by
  4 17 the managed care organization.
  4 18    (2)  A statement of the basis upon which the Medicaid
  4 19 provider believes the managed care organization's determination
  4 20 to be erroneous.
  4 21    (3)  The Medicaid provider's designated contact information,
  4 22 including name, mailing address, phone number, fax number, and
  4 23 email address.
  4 24    3.  a.  Within five business days of receiving a Medicaid
  4 25 provider's request for review pursuant to this subsection, the
  4 26 managed care organization shall do all of the following:
  4 27    (1)  Confirm to the Medicaid provider's designated contact,
  4 28 in writing, that the managed care organization has received the
  4 29 request for review.
  4 30    (2)  Notify the department of the Medicaid provider's
  4 31 request for review.
  4 32    (3)  Notify the affected Medicaid member of the Medicaid
  4 33 provider's request for review, if the review is related to the
  4 34 denial of a service.
  4 35    b.  If the managed care organization fails to satisfy the
  5  1 requirements of this subsection 3,  the Medicaid provider shall
  5  2 automatically prevail in the review.
  5  3    4.  a.  Within fifteen calendar days of receiving a Medicaid
  5  4 provider's request for external independent third=party review,
  5  5 the managed care organization shall do all of the following:
  5  6    (1)  Submit to the department all documentation submitted
  5  7 by the Medicaid provider in the course of the managed care
  5  8 organization's internal appeal process.
  5  9    (2)  Provide the managed care organization's designated
  5 10 contact information, including name, mailing address, phone
  5 11 number, fax number, and email address.
  5 12    b.  If a managed care organization fails to satisfy the
  5 13 requirements of this subsection 4, the Medicaid provider shall
  5 14 automatically prevail in the review.
  5 15    5.  An external independent third=party review shall
  5 16 automatically extend the deadline to file an appeal for a
  5 17 contested case hearing under chapter 17A, pending the outcome
  5 18 of the external independent third=party review, until thirty
  5 19 calendar days following receipt of the review decision by the
  5 20 Medicaid provider.
  5 21    6.  Upon receiving notification of a request for external
  5 22 independent third=party review, the department shall do all of
  5 23 the following:
  5 24    a.  Assign the review to an external independent third=party
  5 25 reviewer.
  5 26    b.  Notify the managed care organization of the identity of
  5 27 the external independent third=party reviewer.
  5 28    c.  Notify the Medicaid provider's designated contact of the
  5 29 identity of the external independent third=party reviewer.
  5 30    7.  The department shall deny a request for an external
  5 31 independent third=party review if the requesting Medicaid
  5 32 provider fails to exhaust the managed care organization's
  5 33 internal appeals process or fails to submit a timely request
  5 34 for an external independent third=party review pursuant to this
  5 35 subsection.
  6  1    8.  a.  Multiple appeals through the external independent
  6  2 third=party review process regarding the same Medicaid
  6  3 member, a common question of fact, or interpretation of common
  6  4 applicable regulations or reimbursement requirements may
  6  5 be combined and determined in one action upon request of a
  6  6 party in accordance with rules and regulations adopted by the
  6  7 department.
  6  8    b.  The Medicaid provider that initiated a request for
  6  9 an external independent third=party review, or one or more
  6 10 other Medicaid providers, may add claims to such an existing
  6 11 external independent third=party review following exhaustion
  6 12 of any applicable managed care organization internal appeals
  6 13 process, if the claims involve a common question of fact
  6 14 or interpretation of common applicable regulations or
  6 15 reimbursement requirements.
  6 16    9.  Documentation reviewed by the external independent
  6 17 third=party reviewer shall be limited to documentation
  6 18 submitted pursuant to subsection 4.
  6 19    10.  An external independent third=party reviewer shall do
  6 20 all of the following:
  6 21    a.  Conduct an external independent third=party review
  6 22 of any claim submitted to the reviewer pursuant to this
  6 23 subsection.
  6 24    b.  Within thirty calendar days from receiving the request
  6 25 for review from the department and the documentation submitted
  6 26 pursuant to subsection 4, issue the reviewer's final decision
  6 27 to the Medicaid provider's designated contact, the managed
  6 28 care organization's designated contact, the department, and
  6 29 the affected Medicaid member if the decision involves a denial
  6 30 of service. The reviewer may extend the time to issue a final
  6 31 decision by fourteen calendar days upon agreement of all
  6 32 parties to the review.
  6 33    11.  The department shall enter into a contract with
  6 34 an independent review organization that does not have a
  6 35 conflict of interest with the department or any managed care
  7  1 organization to conduct the independent third=party reviews
  7  2 under this section.
  7  3    a.  A party, including the affected Medicaid member or
  7  4 Medicaid provider, may appeal a final decision of the external
  7  5 independent third=party reviewer in a contested case proceeding
  7  6 in accordance with chapter 17A within thirty calendar days from
  7  7 receiving the final decision. A final decision in a contested
  7  8 case proceeding is subject to judicial review.
  7  9    b.  The final decision of any external independent
  7 10 third=party review conducted pursuant to this subsection shall
  7 11 also direct the nonprevailing party to pay an amount equal to
  7 12 the costs of the review to the external independent third=party
  7 13 reviewer. Any payment ordered pursuant to this subsection
  7 14 shall be stayed pending any appeal of the review. If the
  7 15 final outcome of any appeal is to reverse the decision of the
  7 16 external independent third=party review, the nonprevailing
  7 17 party shall pay the costs of the review to the external
  7 18 independent third=party reviewer within forty=five calendar
  7 19 days of entry of the final order.
  7 20                           EXPLANATION
  7 21 The inclusion of this explanation does not constitute agreement with
  7 22 the explanation's substance by the members of the general assembly.
  7 23    This bill relates to Medicaid managed care including process
  7 24 and contract requirements, and oversight.
  7 25    The bill requires the department of human services (DHS) to
  7 26 adopt administrative rules and amend all Medicaid managed care
  7 27 contracts to administer the provisions of the bill.
  7 28    The bill requires that, upon request by a Medicaid provider,
  7 29 DHS shall provide accurate and uniform patient encounter data
  7 30 to a Medicaid provider, under contract with a managed care
  7 31 organization (MCO), within 60 calendar days of the request.
  7 32 DHS may charge a reasonable fee for the actual cost of
  7 33 providing the patient encounter data to a Medicaid provider.
  7 34    The bill requires an MCO to provide documentation to a
  7 35 Medicaid provider claimant when the MCO contests or denies
  8  1 a claim, in whole or in part, within 15 calendar days after
  8  2 receipt of the claim.  The bill specifies the information to be
  8  3 included in the documentation, requires the MCO to utilize the
  8  4 standard coding and format of responses, established uniformly
  8  5 across all MCOs by DHS, and requires MCOs to offer quarterly
  8  6 in=person training on claim adjustment reason codes and remark
  8  7 codes.
  8  8    The bill requires MCOs to offer quarterly in=person
  8  9 education regarding billing guidelines, reimbursement
  8 10 requirements, and program policies and procedures utilizing a
  8 11 format approved by DHS and incorporating information collected
  8 12 through surveys of Medicaid providers.
  8 13    The bill requires DHS to develop uniform standards and
  8 14 require utilization of such uniform standards by all MCOs
  8 15 regarding a standardized enrollment form and a uniform process
  8 16 for credentialing and recredentialing Medicaid providers;
  8 17 procedures, requirements, and periodic reviews and reporting of
  8 18 reductions in and limitations for prior authorization relative
  8 19 to services and prescriptions; retrospective utilization review
  8 20 of hospital readmissions; a grievance, appeal, external review,
  8 21 and state fair hearing process; and resolution of all appeals
  8 22 within a 60=day time frame.
  8 23    The bill requires DHS to enter into a contract with an
  8 24 independent auditor to, at least annually, review a random
  8 25 sample of all claims paid and denied by each MCO and each MCO's
  8 26 subcontractors, and provides for payment by an MCO of any claim
  8 27 that the independent auditor determines to be incorrectly
  8 28 denied, any applicable liquidated damages, and any costs
  8 29 attributable to the annual audit.
  8 30    The bill requires an MCO to pay 100 percent of the
  8 31 state=established per diem rate to nursing facilities for those
  8 32 nursing facility residents enrolled in Medicaid during any
  8 33 recredentialing process caused by a change in ownership of the
  8 34 nursing facility.
  8 35    The bill prohibits MCOs from discriminating against any
  9  1 licensed pharmacy or pharmacist located within the geographic
  9  2 coverage area of the MCO that is willing to meet the conditions
  9  3 for participating established by DHS and to accept reasonable
  9  4 contract terms offered by the MCO.
  9  5    The bill also establishes an external review process for the
  9  6 review of final adverse determinations of the MCOs' internal
  9  7 appeal processes. The bill provides that a final decision
  9  8 of an external reviewer may be reviewed in a contested case
  9  9 proceeding pursuant to Code chapter 17A, and ultimately is
  9 10 subject to judicial review.
       LSB 6049XS (8) 87
       pf/rh
feedback