PRINTER'S NO. 3366
No. 2529 Session of 1996
INTRODUCED BY HALUSKA, READSHAW, KING, D. W. SNYDER,
CAPPABIANCA, MUNDY, CURRY, BOSCOLA, CORPORA, JOSEPHS, SHANER,
STABACK, MANDERINO, COLAFELLA, OLASZ, DALEY, DeLUCA, MELIO,
KUKOVICH, MASLAND, SAINATO, ROBINSON, WALKO, DERMODY,
PETRARCA, BLAUM, McGEEHAN, BELFANTI, COLAIZZO, FEESE, SATHER,
TIGUE, STETLER, STURLA, HORSEY, MICHLOVIC, PETRONE, MARKOSEK,
TRAVAGLIO, M. COHEN, TRICH, JAROLIN, ROBERTS, LAUGHLIN,
McCALL AND CAWLEY, APRIL 1, 1996
REFERRED TO COMMITTEE ON HEALTH AND HUMAN SERVICES,
APRIL 1, 1996
AN ACT
1 Requiring managed-care organizations to provide information to
2 covered persons relating to health care practitioner payment
3 and reimbursement; conferring powers and duties on the
4 Department of Health; and imposing civil penalties.
5 The General Assembly of the Commonwealth of Pennsylvania
6 hereby enacts as follows:
7 Section 1. Short title.
8 This act shall be known and may be cited as the Managed-Care
9 Consumer Protection Act.
10 Section 2. Definitions.
11 The following words and phrases when used in this act shall
12 have the meanings given to them in this section unless the
13 context clearly indicates otherwise:
14 "Department." The Department of Health of the Commonwealth.
15 "Health care practitioner." An individual who is authorized
1 to practice some component of the healing arts by a license,
2 permit, certificate or registration issued by a Commonwealth
3 licensing agency or board. The term includes, but is not limited
4 to, a medical doctor, an osteopathic physician, a chiropractor,
5 a dentist, an optometrist, a pharmacist, a physical therapist, a
6 podiatrist, a professional nurse and a psychologist.
7 "Managed care organization." A risk-bearing preferred
8 provider organization or exclusive provider organization
9 organized and regulated under the act of May 17, 1921 (P.L.682,
10 No.284), known as The Insurance Company Law of 1921, or a health
11 maintenance organization organized and regulated under the act
12 of December 29, 1972 (P.L.1701, No.364), known as the Health
13 Maintenance Organization Act, or a preferred provider with a
14 health management/"gatekeeper" role for primary care physicians
15 organized and regulated as a health services corporation under
16 40 Pa.C.S. Ch. 63 (relating to professional health services plan
17 corporations).
18 Section 3. Notification to covered persons.
19 A managed-care organization shall notify a covered person in
20 writing of the terms and conditions governing how the managed-
21 care organization makes payments to or reimburses health care
22 practitioners for services provided to patients. The
23 notification shall be written in nontechnical, easily understood
24 language and shall include, but is not necessarily limited to,
25 information as to whether the physician is an employee of the
26 managed-care organization and whether the physician or group of
27 physicians is reimbursed for its services primarily on the basis
28 of an aggregate fixed sum or on a per capita basis. The managed-
29 care organization shall provide this notification to each of its
30 covered persons on an annual basis no later than 45 days
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1 preceding the commencement of the person's annual enrollment
2 period.
3 Section 4. Penalty.
4 The department may assess a civil penalty of not more than
5 $10,000 upon any entity that violates this act. In determining
6 the civil penalty the department shall consider the willfulness
7 of the violation, deterrence of future violations, history of
8 previous violations and any other relevant factors. No penalty
9 may be assessed under this section unless the party charged has
10 been given notice of and an opportunity for a hearing.
11 Section 5. Regulations.
12 The department shall promulgate rules and regulations to
13 administer and enforce this act.
14 Section 6. Effective date.
15 This act shall take effect in 60 days.
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