Bill Text: IL SB1703 | 2019-2020 | 101st General Assembly | Introduced

---

Bill Title: Amends the Illinois Public Aid Code. Makes a technical change in a Section concerning construction of the Code.

Spectrum: Partisan Bill (Democrat 5-0)

Status: (Failed) 2021-01-13 - Session Sine Die [SB1703 Detail]

Download: Illinois-2019-SB1703-Introduced.html

---

101ST GENERAL ASSEMBLY State of Illinois 2019 and 2020 SB1703 Introduced 2/15/2019, by Sen. Don Harmon SYNOPSIS AS INTRODUCED:
305 ILCS 5/5-30.1
Amends the Medical Assistance Article of the Illinois Public Aid Code. Provides that a provider who has exhausted the written internal appeals process of a managed care organization (MCO) shall be entitled to an external independent third-party review of the MCO's final decision that denies, in whole or in part, a health care service to an enrollee or a claim for reimbursement to a provider for a health care service rendered to an enrollee of the Medicaid managed care organization. Requires a MCO's final decision letter to a provider to include: (i) a statement that the provider's internal appeal rights within the MCO have been exhausted; (ii) a statement that the provider is entitled to an external independent third-party review; (iii) the time period granted to request an external independent third-party review; and (iv) the mailing address to initiate an external independent third-party review. Provides that a party shall be entitled to appeal a final decision of the external independent third-party review within 30 days after the date upon which the appealing party receives the external independent third-party review. Provides that a final decision by the Director of Healthcare and Family Services shall be final and reviewable under the Administrative Review Law. Contains provisions concerning fees to help defray the cost of the administrative hearings; the specific claims of services that are appealable; and the Department's rulemaking authority. Effective immediately.
LRB101 09316 KTG 54411 b
FISCAL NOTE ACT MAY APPLY
A BILL FOR
SB1703 LRB101 09316 KTG 54411 b
AN ACT concerning public aid.
Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
Section 5. The Illinois Public Aid Code is amended by
changing Section 5-30.1 as follows:
(305 ILCS 5/5-30.1)
Sec. 5-30.1. Managed care protections.
(a) As used in this Section:
"Managed care organization" or "MCO" means any entity which
contracts with the Department to provide services where payment
for medical services is made on a capitated basis.
"Emergency services" include:
(1) emergency services, as defined by Section 10 of the
Managed Care Reform and Patient Rights Act;
(2) emergency medical screening examinations, as
defined by Section 10 of the Managed Care Reform and
Patient Rights Act;
(3) post-stabilization medical services, as defined by
Section 10 of the Managed Care Reform and Patient Rights
Act; and
(4) emergency medical conditions, as defined by
Section 10 of the Managed Care Reform and Patient Rights
Act.

SB1703 - 2 - LRB101 09316 KTG 54411 b
(b) As provided by Section 5-16.12, managed care
organizations are subject to the provisions of the Managed Care
Reform and Patient Rights Act.
(c) An MCO shall pay any provider of emergency services
that does not have in effect a contract with the contracted
Medicaid MCO. The default rate of reimbursement shall be the
rate paid under Illinois Medicaid fee-for-service program
methodology, including all policy adjusters, including but not
limited to Medicaid High Volume Adjustments, Medicaid
Percentage Adjustments, Outpatient High Volume Adjustments,
and all outlier add-on adjustments to the extent such
adjustments are incorporated in the development of the
applicable MCO capitated rates.
(d) An MCO shall pay for all post-stabilization services as
a covered service in any of the following situations:
(1) the MCO authorized such services;
(2) such services were administered to maintain the
enrollee's stabilized condition within one hour after a
request to the MCO for authorization of further
post-stabilization services;
(3) the MCO did not respond to a request to authorize
such services within one hour;
(4) the MCO could not be contacted; or
(5) the MCO and the treating provider, if the treating
provider is a non-affiliated provider, could not reach an
agreement concerning the enrollee's care and an affiliated

SB1703 - 3 - LRB101 09316 KTG 54411 b
provider was unavailable for a consultation, in which case
the MCO must pay for such services rendered by the treating
non-affiliated provider until an affiliated provider was
reached and either concurred with the treating
non-affiliated provider's plan of care or assumed
responsibility for the enrollee's care. Such payment shall
be made at the default rate of reimbursement paid under
Illinois Medicaid fee-for-service program methodology,
including all policy adjusters, including but not limited
to Medicaid High Volume Adjustments, Medicaid Percentage
Adjustments, Outpatient High Volume Adjustments and all
outlier add-on adjustments to the extent that such
adjustments are incorporated in the development of the
applicable MCO capitated rates.
(e) The following requirements apply to MCOs in determining
payment for all emergency services:
(1) MCOs shall not impose any requirements for prior
approval of emergency services.
(2) The MCO shall cover emergency services provided to
enrollees who are temporarily away from their residence and
outside the contracting area to the extent that the
enrollees would be entitled to the emergency services if
they still were within the contracting area.
(3) The MCO shall have no obligation to cover medical
services provided on an emergency basis that are not
covered services under the contract.

SB1703 - 4 - LRB101 09316 KTG 54411 b
(4) The MCO shall not condition coverage for emergency
services on the treating provider notifying the MCO of the
enrollee's screening and treatment within 10 days after
presentation for emergency services.
(5) The determination of the attending emergency
physician, or the provider actually treating the enrollee,
of whether an enrollee is sufficiently stabilized for
discharge or transfer to another facility, shall be binding
on the MCO. The MCO shall cover emergency services for all
enrollees whether the emergency services are provided by an
affiliated or non-affiliated provider.
(6) The MCO's financial responsibility for
post-stabilization care services it has not pre-approved
ends when:
(A) a plan physician with privileges at the
treating hospital assumes responsibility for the
enrollee's care;
(B) a plan physician assumes responsibility for
the enrollee's care through transfer;
(C) a contracting entity representative and the
treating physician reach an agreement concerning the
enrollee's care; or
(D) the enrollee is discharged.
(f) Network adequacy and transparency.
(1) The Department shall:
(A) ensure that an adequate provider network is in

SB1703 - 5 - LRB101 09316 KTG 54411 b
place, taking into consideration health professional
shortage areas and medically underserved areas;
(B) publicly release an explanation of its process
for analyzing network adequacy;
(C) periodically ensure that an MCO continues to
have an adequate network in place; and
(D) require MCOs, including Medicaid Managed Care
Entities as defined in Section 5-30.2, to meet provider
directory requirements under Section 5-30.3.
(2) Each MCO shall confirm its receipt of information
submitted specific to physician or dentist additions or
physician or dentist deletions from the MCO's provider
network within 3 days after receiving all required
information from contracted physicians or dentists, and
electronic physician and dental directories must be
updated consistent with current rules as published by the
Centers for Medicare and Medicaid Services or its successor
agency.
(g) Timely payment of claims.
(1) The MCO shall pay a claim within 30 days of
receiving a claim that contains all the essential
information needed to adjudicate the claim.
(2) The MCO shall notify the billing party of its
inability to adjudicate a claim within 30 days of receiving
that claim.
(3) The MCO shall pay a penalty that is at least equal

SB1703 - 6 - LRB101 09316 KTG 54411 b
to the penalty imposed under the Illinois Insurance Code
for any claims not timely paid.
(4) The Department may establish a process for MCOs to
expedite payments to providers based on criteria
established by the Department.
(g-5) Recognizing that the rapid transformation of the
Illinois Medicaid program may have unintended operational
challenges for both payers and providers:
(1) in no instance shall a medically necessary covered
service rendered in good faith, based upon eligibility
information documented by the provider, be denied coverage
or diminished in payment amount if the eligibility or
coverage information available at the time the service was
rendered is later found to be inaccurate; and
(2) the Department shall, by December 31, 2016, adopt
rules establishing policies that shall be included in the
Medicaid managed care policy and procedures manual
addressing payment resolutions in situations in which a
provider renders services based upon information obtained
after verifying a patient's eligibility and coverage plan
through either the Department's current enrollment system
or a system operated by the coverage plan identified by the
patient presenting for services:
(A) such medically necessary covered services
shall be considered rendered in good faith;
(B) such policies and procedures shall be

SB1703 - 7 - LRB101 09316 KTG 54411 b
developed in consultation with industry
representatives of the Medicaid managed care health
plans and representatives of provider associations
representing the majority of providers within the
identified provider industry; and
(C) such rules shall be published for a review and
comment period of no less than 30 days on the
Department's website with final rules remaining
available on the Department's website.
(3) The rules on payment resolutions shall include, but
not be limited to:
(A) the extension of the timely filing period;
(B) retroactive prior authorizations; and
(C) guaranteed minimum payment rate of no less than
the current, as of the date of service, fee-for-service
rate, plus all applicable add-ons, when the resulting
service relationship is out of network.
(4) The rules shall be applicable for both MCO coverage
and fee-for-service coverage.
(g-6) MCO Performance Metrics Report.
(1) The Department shall publish, on at least a
quarterly basis, each MCO's operational performance,
including, but not limited to, the following categories of
metrics:
(A) claims payment, including timeliness and
accuracy;

SB1703 - 8 - LRB101 09316 KTG 54411 b
(B) prior authorizations;
(C) grievance and appeals;
(D) utilization statistics;
(E) provider disputes;
(F) provider credentialing; and
(G) member and provider customer service.
(2) The Department shall ensure that the metrics report
is accessible to providers online by January 1, 2017.
(3) The metrics shall be developed in consultation with
industry representatives of the Medicaid managed care
health plans and representatives of associations
representing the majority of providers within the
identified industry.
(4) Metrics shall be defined and incorporated into the
applicable Managed Care Policy Manual issued by the
Department.
(g-7) MCO claims processing and performance analysis. In
order to monitor MCO payments to hospital providers, pursuant
to this amendatory Act of the 100th General Assembly, the
Department shall post an analysis of MCO claims processing and
payment performance on its website every 6 months. Such
analysis shall include a review and evaluation of a
representative sample of hospital claims that are rejected and
denied for clean and unclean claims and the top 5 reasons for
such actions and timeliness of claims adjudication, which
identifies the percentage of claims adjudicated within 30, 60,

SB1703 - 9 - LRB101 09316 KTG 54411 b
90, and over 90 days, and the dollar amounts associated with
those claims. The Department shall post the contracted claims
report required by HealthChoice Illinois on its website every 3
months.
(g-8) External independent review and administrative
appeal hearing.
(1) Notwithstanding any other law to the contrary, a
provider who has exhausted the written internal appeals
process of an MCO shall be entitled to an external
independent third-party review of the MCO's final decision
that denies, in whole or in part, a health care service to
an enrollee or a claim for reimbursement to a provider for
a health care service rendered by the provider to an
enrollee of the Medicaid managed care organization.
Multiple claims may be determined in one action upon
request of a party in accordance with administrative rules
adopted by the Department.
(2) An MCO's letter to a provider reflecting the final
decision of the provider's internal appeal shall include:
(A) a statement that the provider's internal
appeal rights within the MCO have been exhausted;
(B) a statement that the provider is entitled to an
external independent third-party review;
(C) the time period granted to request an external
independent third-party review; and
(D) the mailing address to initiate an external

SB1703 - 10 - LRB101 09316 KTG 54411 b
independent third-party review.
(3) A party shall be entitled to appeal a final
decision of the external independent third-party review
through the administrative hearing process within the
Department, in accordance with 89 Ill. Adm. Code 104.200
through 104.295. An appeal shall be filed within 30 days
after the date upon which the appealing party receives the
final decision of the external independent third-party
review. A final decision by the Director shall be final and
reviewable under the Administrative Review Law. The
Department may, by rule, establish reasonable fees, not to
exceed $1,000, to defray expenses associated with an
administrative hearing that shall be paid by the party who
does not prevail in the Director's final decision after an
administrative hearing.
(4) The requirements of this subsection shall apply to
claims for services provided on or after the first day of
the month that begins 120 days after the effective date of
this amendatory Act of the 101st General Assembly. Within
120 days after the effective date of this amendatory Act of
the 101st General Assembly, the Department shall adopt
administrative rules to implement this subsection.
(h) The Department shall not expand mandatory MCO
enrollment into new counties beyond those counties already
designated by the Department as of June 1, 2014 for the
individuals whose eligibility for medical assistance is not the

SB1703 - 11 - LRB101 09316 KTG 54411 b
seniors or people with disabilities population until the
Department provides an opportunity for accountable care
entities and MCOs to participate in such newly designated
counties.
(i) The requirements of this Section apply to contracts
with accountable care entities and MCOs entered into, amended,
or renewed after June 16, 2014 (the effective date of Public
Act 98-651).
(Source: P.A. 99-725, eff. 8-5-16; 99-751, eff. 8-5-16;
100-201, eff. 8-18-17; 100-580, eff. 3-12-18; 100-587, eff.
6-4-18.)
Section 99. Effective date. This Act takes effect upon
becoming law.