HB 503: Managed Care Plan Contracts with Health Care Providers

H.B. 503, P.N. 541 (GANNON) This would create the Managed Care Plan-Provider Contracting Act.
A contract between a managed plan and a health care provider would be required to be negotiated in good faith. Such a provider would have 60 days after receiving a contract to review it. A managed care plan would be required to provide any missing documents within seven business days of receiving such a request. A plan would not be required to provide any proprietary information or information that would harm its financial position.
Such a contract would be required to indicate the diagnostic and therapeutic services as well as the prescription drug formularies commonly used by the plan. The contract would be required to be in plain English with the responsibilities of both parties explicitly defined.
Within ten days from a contract’s execution a managed care plan would provide a health care provider with a copy of all its administrative policies and procedures including coverage policies and dispute resolution mechanisms. A manager care plan could not compel a provider to accept arbitration as the only means of resolving disputes.
A managed care plan would be prohibited from making a provider indemnify a plan due to a liability claim, could not represent the provider as a member of a network other than as committed to in the agreement, could not compel a provider to enter into an exclusive agreement, could not be for more than one year (although they could provide for automatic renewal), and would provide for an appeal process should a plan decide to terminate the contract for cause.
A managed care plan would be required to quickly and efficiently determine an enrollee’s eligibility for services. Medically necessary services or products that a prudent physician would provide would be required to be provided in such a plan. A managed care plan would be required to reimburse a provider for services provided on the basis of an erroneous statement of eligibility.
A managed care plan would be required to determine whether to credential a health care provider or a health care facility within 45 days of receiving a complete application for credentials. Claims that occur during the credentialing process where the credentialing is approved would be reimbursed retroactively.
A managed care plan that claims it has made an erroneous payment would be required to complete procedures for challenging the payment. Such a plan would be prohibited from withholding future reimbursements in attempting to recoup alleged erroneous payments. An erroneous payment over $10,000 would allow a provider to make payments in installments over three years or less. This, though, would not pertain to cases of suspected fraud, illegality, or malfeasance.
A managed care plan would be required to disclose its actuarial assumptions used for capitated payments to primary health care providers including per-member-per-month reimbursements for any member so requested by the provider.
A managed care plan would be required to disclose to a health care provider its payments range for the 100 most commonly submitted CPT codes within the provider’s field of practice. Such plans would be required to abide by definitions and CPT codes as established by the American Medical Association or Centers for Medicare and Medicaid Services.
The Insurance Department could assess administrative penalties, in addition to other remedies available at law, for violating this Act of $5,000 or less per violation.