PRIOR PRINTER'S NO. 1083 PRINTER'S NO. 3393
No. 977 Session of 1997
INTRODUCED BY VANCE, DRUCE, MICOZZIE, COLAFELLA, SAYLOR, WAUGH,
CURRY, COLAIZZO, YOUNGBLOOD, SEMMEL, SCHRODER, HENNESSEY,
TIGUE, ALLEN, GORDNER, NICKOL, KENNEY, MUNDY, E. Z. TAYLOR,
TRICH, HARHART, D. W. SNYDER, MANDERINO, RUBLEY, CARONE,
BUNT, ITKIN, TRUE, PESCI, STEELMAN, DeLUCA, CLYMER, CORNELL,
JOSEPHS, BOSCOLA, STURLA, BARD, OLASZ, MILLER, L. I. COHEN,
SATHER, GEORGE, O'BRIEN, FLEAGLE, BUXTON, STRITTMATTER,
MICHLOVIC, STERN, TULLI, HALUSKA, BROWNE, OLIVER, McGILL,
THOMAS, BEBKO-JONES, TRELLO, BELFANTI, GRUPPO, BOYES, ROSS,
RAMOS, BARRAR, ZUG, ORIE, DENT, SEYFERT AND BAKER,
MARCH 19, 1997
AS REPORTED FROM COMMITTEE ON INSURANCE, HOUSE OF
REPRESENTATIVES, AS AMENDED, APRIL 20, 1998
AN ACT
1 Requiring certification of utilization review entities; <--
2 providing for appeal processes for providers, for the
3 disclosure of certain uniform information and for delivery of
4 health care in a cost-effective manner.
5 TABLE OF CONTENTS
6 Section 1. Short title.
7 Section 2. Purposes.
8 Section 3. Definitions.
9 Section 4. Certification of utilization review entity.
10 Section 5. Utilization review standards.
11 Section 6. Utilization review decisions and internal appeals.
12 Section 7. External utilization review appeals.
13 Section 8. Provider credentialing.
14 Section 9. Uniform disclosure.
1 Section 10. Penalties.
2 Section 11. Rulemaking.
3 Section 12. Severability.
4 Section 13. Repeals.
5 Section 14. Applicability.
6 Section 15. Effective date.
7 PROVIDING FOR MANAGED HEALTH CARE UTILIZATION REVIEW; IMPOSING <--
8 DUTIES ON MANAGED CARE ENTITIES; PROVIDING FOR DISCLOSURE,
9 CIVIL IMMUNITY AND PENALTIES; AND CONFERRING POWERS AND
10 DUTIES ON THE DEPARTMENT OF HEALTH AND THE INSURANCE
11 DEPARTMENT.
12 TABLE OF CONTENTS
13 SECTION 1. SHORT TITLE.
14 SECTION 2. PURPOSE.
15 SECTION 3. DEFINITIONS.
16 SECTION 4. CERTIFICATION OF UTILIZATION REVIEW ENTITY.
17 SECTION 5. UTILIZATION REVIEW OPERATIONAL STANDARDS.
18 SECTION 6. INITIAL UTILIZATION REVIEW DECISIONS.
19 SECTION 7. INTERNAL APPEALS.
20 SECTION 8. INDEPENDENT EXTERNAL REVIEW PROCESS.
21 SECTION 9. PARTICIPATING PROVIDERS.
22 SECTION 10. PROVIDER CREDENTIALING.
23 SECTION 11. UNIFORM DISCLOSURE.
24 SECTION 12. PROMPT PAYMENT OF CLEAN CLAIMS.
25 SECTION 13. INVESTIGATIONS AND PENALTIES.
26 SECTION 14. REGULATIONS.
27 SECTION 15. EXCEPTIONS.
28 SECTION 16. APPLICABILITY.
29 SECTION 17. DISCRIMINATION ON MORAL OR RELIGIOUS GROUNDS
30 PROHIBITED.
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1 SECTION 18. EFFECTIVE DATE.
2 The General Assembly of the Commonwealth of Pennsylvania
3 hereby enacts as follows:
4 Section 1. Short title. <--
5 This act shall be known and may be cited as the Health Plan
6 Accountability Act.
7 Section 2. Purposes.
8 The purposes of this act are to:
9 (1) Promote the delivery of health care in a cost-
10 effective manner.
11 (2) Foster greater coordination among health care
12 providers, patients and payers.
13 (3) Promote patient access to quality health care in a
14 timely fashion.
15 (4) Safeguard patients by certifying the activities of
16 utilization review entities.
17 (5) Provide sufficient information to providers
18 regarding utilization review processes, criteria and the
19 procedures for appealing utilization review determinations.
20 (6) Establish an appeals process that may be used by
21 providers to appeal adverse utilization review determinations
22 by utilization review entities.
23 (7) Establish minimum provider credentialing standards
24 to be used by payers.
25 Section 3. Definitions.
26 The following words and phrases when used in this act shall
27 have the meanings given to them in this section unless the
28 context clearly indicates otherwise:
29 "Accrediting body." A nationally recognized accrediting
30 agency.
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1 "Active clinical practice." A health care practitioner who
2 practices clinical medicine on the average of not less than 20
3 hours per week.
4 "Clinical review criteria." The written screening
5 procedures, decision abstracts, clinical protocols and practice
6 guidelines used by a utilization review entity to evaluate the
7 necessity and appropriateness of health care services delivered
8 or proposed to be delivered.
9 "Commissioner." The Insurance Commissioner of the
10 Commonwealth.
11 "Covered individual." An enrollee or an eligible dependent
12 of an enrollee.
13 "Credentialing criteria." The standards used by a payer to
14 evaluate the qualifications of a health care practitioner or
15 health care facility to participate in the payer's provider
16 network.
17 "Department." The Department of Health of the Commonwealth.
18 "Enrollee." An individual who has contracted for or who
19 participates in coverage under:
20 (1) an insurance policy issued by a professional health
21 service corporation, hospital plan corporation or a health
22 and accident insurer;
23 (2) a contract issued by a health maintenance
24 organization or a preferred provider organization; or
25 (3) other benefit programs providing payment,
26 reimbursement or indemnification for the costs of health care
27 for the covered individual.
28 "Health care facility." Any health care facility providing
29 clinically related health services, including, but not limited
30 to, a general or special hospital, including psychiatric
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1 hospitals, rehabilitation hospitals, ambulatory surgical
2 facilities, long-term care nursing facilities, cancer treatment
3 centers using radiation therapy on an ambulatory basis and
4 inpatient drug and alcohol treatment facilities.
5 "Health care insurer." Any entity operating under any of the
6 laws listed in section 14.
7 "Health care practitioner." Any individual who is licensed,
8 certified or otherwise regulated to practice health care under
9 the laws of this Commonwealth, including, but not limited to, a
10 physician, a dentist, a podiatrist, an optometrist, a
11 psychologist, a physical therapist, a certified registered nurse
12 practitioner, a registered nurse, a nurse midwife, a physician's
13 assistant or a chiropractor.
14 "Integrated delivery system." A partnership, association,
15 affiliation, corporation or other legal entity which enters into
16 contractual, risk-sharing arrangements with health insurers to
17 provide or arrange for the provision of health care services and
18 assumes some responsibility for quality assurance, utilization
19 review, provider credentialing and related functions and which
20 assumes to some extent, through capitation reimbursement or
21 other risk-sharing arrangement, the financial risk for provision
22 of health care services to enrollees.
23 "Licensing authority." The licensing authority of the health
24 insurers listed in section 14.
25 "Payer." Any entity operating under any of the laws listed
26 in section 14 as well as any other entity employing, affiliated
27 with or contracting with a utilization review entity or paying
28 for credentialing activities.
29 "Provider network." The health care practitioners and health
30 care facilities designated by a payer for enrollee use in
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1 obtaining covered heath care services. This term shall not apply
2 to broad-based networks that are primarily fee-for-service,
3 indemnity arrangements with minimum participation requirements
4 and limited utilization review procedures.
5 "Provider of record." The physician, licensed practitioner
6 or health care facility identified to a utilization review
7 entity or insurer as having prescribed, proposed to provide or
8 provided health care services to a covered individual.
9 "Secretary." The Secretary of Health of the Commonwealth.
10 "Utilization review." A system for prospective, concurrent,
11 retrospective review or case management of the medical necessity
12 and appropriateness of health care services provided or proposed
13 to be provided to a covered individual. The term does not
14 include any of the following:
15 (1) requests for clarification of coverage, eligibility
16 or benefits verification;
17 (2) a health care facility's or a health care
18 practitioner's internal quality assurance or utilization
19 review process unless such review results in a denial of
20 payment, coverage or treatment; or
21 (3) refusal to contract with health care practitioners
22 or health care facilities.
23 "Utilization review determination." The rendering of a
24 decision based on utilization review that approves or denies
25 either of the following:
26 (1) the necessity or appropriateness of the allocations
27 of health care resources to a covered individual; or
28 (2) the provision or proposed provision of covered
29 health care services to an enrollee.
30 "Utilization review entity." Any payer or any entity
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1 performing utilization review while employed by, affiliated
2 with, under contract with or acting on behalf of any of the
3 following:
4 (1) an entity doing business in this Commonwealth;
5 (2) an integrated delivery system;
6 (3) a party that provides or administers health care
7 benefits to citizens of this Commonwealth, including a health
8 care insurer, self-insured plan, professional health service
9 corporation, hospital plan corporation, preferred provider
10 organization or health maintenance organization authorized to
11 offer health insurance policies or contracts to pay for the
12 delivery of health care services or treatment in this
13 Commonwealth; or
14 (4) the Commonwealth or any of its political
15 subdivisions or instrumentalities.
16 The term shall not include entities conducting internal
17 utilization review for health care facilities, home health
18 agencies, health maintenance organizations, preferred provider
19 organizations or other managed care entities, or private health
20 care professional offices, unless the performance of such
21 utilization review results in the denial of payment, coverage or
22 treatment.
23 Section 4. Certification of utilization review entity.
24 (a) Certification required.--A utilization review entity may
25 not conduct utilization review regarding services delivered or
26 proposed to be delivered in this Commonwealth unless the entity
27 is certified by the department to perform such services or
28 unless the entity is an integrated delivery system whose
29 utilization review standards have already been approved by the
30 department and adopted for use by a certified utilization review
19970H0977B3393 - 7 -
1 entity. A utilization review entity that has been operating in
2 this Commonwealth prior to the effective date of this act may
3 continue to conduct utilization review for not more than one
4 year after the effective date of this act pending an initial
5 certification determination by the department regarding that
6 entity. The department shall grant certification to any
7 utilization review entity that satisfies the utilization review
8 standards included in sections 5 and 6.
9 (b) Renewal.--Certification shall be renewed every three
10 years unless sooner revoked or suspended by the secretary.
11 (c) Accrediting bodies.--The department may rely on
12 nationally recognized accrediting bodies to the extent the
13 standards of the bodies are determined by the department to
14 substantially meet or exceed the criteria in section 5 and if
15 the entity agrees to the following:
16 (1) Direct the accrediting body to provide a copy of its
17 findings to the department.
18 (2) Permit the department to verify compliance with
19 standards not covered by the accrediting body.
20 (d) Fees.--The secretary is authorized to prescribe fees for
21 initial application and renewal of certification. The fees shall
22 not exceed the administrative costs of the certification
23 process.
24 (e) Procedures.--Licensed health insurers are required to
25 follow the standards and procedures contained in this act, but
26 are not required to be separately certified as utilization
27 review entities by the department.
28 Section 5. Utilization review standards.
29 (a) Requirements.--Utilization review entities providing
30 services in this Commonwealth must satisfy all of the following
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1 requirements:
2 (1) For the purpose of responding to inquiries
3 concerning the entity's utilization review determinations:
4 (i) provide toll-free telephone access at least 40
5 hours each week during normal business hours;
6 (ii) maintain a telephone call answering service or
7 recording system during hours other than normal business
8 hours; and
9 (iii) respond to each telephone call left with the
10 answering service or on the recording system within one
11 business day after the call is left with respect to the
12 review determination.
13 (2) Protect the confidentiality of individual medical
14 records:
15 (i) as required by all applicable Federal and State
16 laws and ensure that a covered individual's medical
17 records and other confidential medical information
18 obtained in the performance of utilization review are not
19 improperly disclosed or redisclosed;
20 (ii) by only requesting medical records and other
21 information which are reasonably necessary to make
22 utilization review determination for the care under
23 review; and
24 (iii) have mechanisms in place that allow a provider
25 to verify that an individual requesting information on
26 behalf of the organization is a legitimate representative
27 of the organization.
28 (3) Unless required by law or court order, prevent third
29 parties from obtaining a covered individual's medical records
30 or confidential information obtained in the performance of
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1 utilization review.
2 (4) Assure that personnel conducting utilization review
3 shall have current licenses that are in good standing and
4 without restrictions from a state health care professional
5 licensing agency in the United States.
6 (5) Within one business day after receiving a request
7 for an initial utilization review determination that includes
8 all information reasonably necessary to complete the
9 utilization review determination, notify the enrollee and the
10 provider of record of the utilization review determination by
11 mail or other means of communication.
12 (6) Include the following in the written notification of
13 a utilization review determination denying coverage for an
14 admission, service, procedure, medical supplies and equipment
15 or a request for approval of continuing treatment for the
16 condition involved in previously approved admissions,
17 services or procedures, medical supplies and equipment:
18 (i) the principal reasons for the determination if
19 the determination is based on medical necessity or the
20 appropriateness of the admission, service, procedure,
21 medical supplies and equipment, or extension of service;
22 and
23 (ii) the description of the appeal procedure,
24 including the name and telephone number of the person to
25 contact in regard to an appeal and the deadline for
26 filing an appeal.
27 (7) Ensure that initial adverse utilization review
28 determination as to the necessity or appropriateness of an
29 admission, service, procedure or medical supplies and
30 equipment is made by a licensed physician or, if appropriate,
19970H0977B3393 - 10 -
1 a psychologist.
2 (8) Ensure that on appeal all determinations not to
3 certify an admission, service, procedure, medical supplies
4 and equipment or extension of stay must be made by a licensed
5 physician or, if appropriate, a psychologist in the same or
6 similar general specialty as typically manages or recommends
7 treatment for the medical condition, procedure or treatment.
8 Further, no physician or psychologist who has been involved
9 in prior reviews of the case under appeal may participate as
10 the sole reviewer of a case under appeal.
11 (9) Provide a period of at least 24 hours following an
12 emergency admission, service, procedure or medical supplies
13 and equipment during which an enrollee or representative of
14 an enrollee may notify the health care insurer and request
15 approval or continuing treatment for the condition under
16 review in the admission, extension of stay, service,
17 procedure, medical supplies and equipment.
18 (10) Provide an appeals procedure satisfying the
19 requirements set forth in this act.
20 (11) Disclose utilization review criteria to providers
21 upon denial.
22 (b) Alternative practices.--Payers and providers may
23 establish alternative utilization review standards, practices
24 and procedures by contract that meet or exceed the requirements
25 in subsection (a) and that are approved by the department.
26 Section 6. Utilization review decisions and internal appeals.
27 Payers that encourage or require enrollees to obtain all or
28 designated covered services through a provider network shall
29 conform to the following provisions:
30 (1) Notification of a prospective or concurrent
19970H0977B3393 - 11 -
1 utilization review determination shall be communicated with
2 the provider of record within one business day of the receipt
3 of all information necessary to complete the review. For
4 retrospective determinations, notice shall be given within 15
5 days.
6 (2) The utilization review entity shall maintain and
7 make available a written description of the appeal procedure
8 by which the provider of record may seek review of the
9 determination to deny an admission, service, procedure,
10 medical supplies and equipment or extension of stay.
11 (3) The internal appeals process shall be established by
12 the utilization review entity and must include a reasonable
13 time period of not less than 45 days following receipt of the
14 written notification of the adverse determination within
15 which an appeal must be filed to be considered.
16 (4) The utilization review entity shall render a
17 determination of appeals of adverse determinations no later
18 than 45 days from the date the appeal and all supporting
19 documentation is filed.
20 (5) The utilization review entity shall provide for an
21 expedited appeals process for emergency or life-threatening
22 situations. Adjudication of expedited appeals shall be
23 completed within 48 hours of the time the appeal is filed.
24 (6) Compensation to any person performing utilization
25 review activities shall not contain incentives, direct or
26 indirect, for that person to approve or deny coverage for
27 admissions, services, procedures, medical supplies and
28 equipment or extension of stays.
29 (7) The utilization review entity shall maintain records
30 of written appeals and their resolution and shall provide
19970H0977B3393 - 12 -
1 reports to their licensing authority or as requested by the
2 department.
3 (8) The department may, in response to a written
4 complaint by a provider, review the payer's adherence to the
5 requirements of this act.
6 Section 7. External utilization review appeals.
7 The utilization review plan of utilization review entities or
8 health care insurers must provide for independent external
9 adjudication in cases where the second level of appeal to
10 reverse an adverse determination is unsuccessful that adheres to
11 the following provisions:
12 (1) The provider of record may initiate the external
13 appeal within 60 days of the adverse determination by
14 submitting written notice to the utilization review entity or
15 health care insurer.
16 (2) The utilization review entity or health care insurer
17 and the provider of record shall each select one competent
18 arbitrator within 30 days from the date the appeal is
19 initiated. The two selected arbitrators shall then select a
20 competent third arbitrator. The arbitration shall take place
21 in the county in which the appealing party resides or
22 practices.
23 (3) At least one arbitrator shall be a licensed
24 physician or, if appropriate, a psychologist, in active
25 clinical practice in the same or similar specialty as
26 typically manages or recommends treatment for the medical
27 condition under review. The remaining arbitrators shall also
28 be licensed health care practitioners.
29 (4) The arbitrators shall review the information
30 considered by the health care insurer in reaching its
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1 decision and any written submissions of the provider of
2 record provided during the internal appeal process. The
3 decision to hold a hearing or otherwise take evidence shall
4 be within the sole discretion of a majority of the
5 arbitrators.
6 (5) The written decision of any two arbitrators shall be
7 issued no later than 30 days after receipt of all
8 documentation necessary to rule upon the appeal and shall be
9 binding upon each party.
10 (6) The arbitrators' fees and costs of the appeal shall
11 be paid by the nonprevailing party.
12 (7) Written contracts between health care insurers and
13 providers may provide for an alternative to the external
14 appeal process as long as that contract or process has been
15 approved by the department. In such cases, a provider may
16 appeal to a physician committee appointed by the governing
17 body of the utilization review entity or health care insurer.
18 No physician serving on the committee to review such appeals
19 may be an employee of the utilization review entity or health
20 care insurer. The provider of record may present information
21 supporting his or her position either in writing or by
22 appearing before the committee in person to do so. The
23 alternative appeals process must include time frames for
24 initiating appeals, receiving written information, holding
25 hearings and rendering final determinations. The committee's
26 decision is the utilization review entity's health care
27 insurer's final determination. If the decision is unfavorable
28 to the provider of record or health care insurer, the
29 provider of record or health care insurer may seek additional
30 remedies in the appropriate court of jurisdiction, as a
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1 matter of original jurisdiction pursuant to 42 Pa.C.S. § 761
2 (relating to original jurisdiction), to the extent such
3 remedies are provided by law.
4 Section 8. Provider credentialing.
5 Payers that encourage or require enrollees to obtain all or
6 designated covered services through a provider network shall
7 conform to the following provisions:
8 (1) Payers must ensure that there are sufficient health
9 care practitioners and health care facilities within a
10 provider network to provide enrollees with access to quality
11 patient care in a timely fashion.
12 (2) Payers shall consult with practicing physicians
13 regarding the professional qualifications, specialty and
14 geographic composition of the physician panel. The payer
15 shall report the composition of its provider network,
16 including the extent to which providers in the network are
17 accepting new enrollees from the insurer, to its licensing
18 authority every two years, or in response to significant
19 changes in the provider network, or as otherwise required by
20 the licensing authority.
21 (3) A payer shall select the participating health care
22 practitioners and health care facilities for its provider
23 network through a formal credentialing process that includes
24 criteria and processes for initial selection, recredentialing
25 and termination. The payer shall report the credentialing
26 criteria and processes to its licensing authority every two
27 years, or in response to significant changes in the criteria
28 and/or processes, or as otherwise required by the licensing
29 authority.
30 (4) A payer shall disclose to applicants and to
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1 providers participating in its network all credentialing
2 criteria and processes used by the payer and approved by the
3 department or by a nationally recognized accrediting body.
4 The proceedings, deliberations and records of a payer with
5 respect to the credentialing of health care providers,
6 however, shall be held in confidence and shall not be subject
7 to discovery or entered into evidence in any civil action
8 against a payer to the same degree that such deliberations,
9 proceedings and records are protected under the act of July
10 20, 1974 (P.L.564, No.193), known as the Peer Review
11 Protection Act.
12 (5) A payer shall not discriminate against patients with
13 expensive medical conditions by excluding from its network
14 health care practitioners with practices that include a
15 substantial number of such patients and consistent with other
16 credentialing criteria.
17 (6) A payer shall not exclude a health care practitioner
18 or health care facility from its provider network because the
19 practitioner or facility has advocated on behalf of a patient
20 in a utilization appeal or another dispute with the plan over
21 the provision of medical care.
22 (7) In the event a payer renders an adverse
23 credentialing decision, the payer shall provide the affected
24 health care practitioner or health care facility with written
25 notice of the decision that includes a clear explanation of
26 the basis for the decision.
27 Section 9. Uniform disclosure.
28 (a) Format.--The commissioner shall adopt a uniform format
29 for the disclosure of the terms and conditions of health
30 insurance plans.
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1 (b) Contents.--The uniform format shall include, at a
2 minimum, the following provisions:
3 (1) The benefits and any and all exclusions.
4 (2) Any and all enrollee coinsurance, copayments and
5 deductibles.
6 (3) Any and all maximum benefit limitations.
7 (4) Any and all requirements or limitations regarding
8 the choice of provider.
9 (5) Disclosure of any and all physician incentive plans.
10 (6) Enrollee satisfaction statistics.
11 (c) Mandatory use.--Payers shall make the information
12 required by the commissioner available to purchasers and
13 potential enrollees in the format adopted by the commissioner.
14 (d) Understandable terms.--The information shall be written
15 in terms understandable to the general public.
16 Section 10. Penalties.
17 The department may impose a fine of up to but not more than
18 $10,000 for each violation of this act. In addition, the
19 department may deny, suspend, revoke or refuse to renew the
20 certification of a utilization review entity or health care
21 insurer that fails to satisfy the utilization review standards
22 set forth in section 5 or that otherwise violates the provisions
23 of this act. The utilization review entity or health care
24 insurer shall be entitled to notice and the right to a hearing
25 pursuant to 2 Pa.C.S. (relating to administrative law and
26 procedure).
27 Section 11. Rulemaking.
28 The secretary and the commissioner are authorized to
29 promulgate regulations to implement this act.
30 Section 12. Severability.
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1 The provisions of this act are severable. If any provision of
2 this act or its application to any person or circumstance is
3 held invalid, the invalidity shall not affect other provisions
4 or applications of this act which can be given effect without
5 the invalid provision or application.
6 Section 13. Repeals.
7 All acts and parts of acts are repealed insofar as they are
8 inconsistent with this act.
9 Section 14. Applicability.
10 This act shall apply to health care utilization review
11 entities or health care insurers operating under any one of the
12 following:
13 (1) Section 630 of the act of May 17, 1921 (P.L.682,
14 No.284), known as The Insurance Company Law of 1921.
15 (2) Act of December 29, 1972 (P.L.1701, No.364), known
16 as the Health Maintenance Organization Act.
17 (3) Act of May 18, 1976 (P.L.123, No.54), known as the
18 Individual Accident and Sickness Insurance Minimum Standards
19 Act.
20 (4) 40 Pa.C.S. Ch.61 (relating to hospital plan
21 corporations).
22 (5) 40 Pa.C.S. Ch.63 (relating to professional health
23 services plan corporations) except for section 6324 (relating
24 to rights of health service doctors).
25 (6) A fraternal benefit society charter.
26 (7) Any successor laws.
27 Section 15. Effective date.
28 This act shall take effect in 120 days.
29 SECTION 1. SHORT TITLE. <--
30 THIS ACT SHALL BE KNOWN AND MAY BE CITED AS THE MANAGED CARE
19970H0977B3393 - 18 -
1 ACCOUNTABILITY ACT.
2 SECTION 2. PURPOSE.
3 THE PURPOSES OF THIS ACT ARE TO:
4 (1) PROMOTE THE DELIVERY OF ACCESSIBLE, QUALITY AND
5 COST-EFFECTIVE HEALTH CARE IN A TIMELY FASHION IN THIS
6 COMMONWEALTH.
7 (2) PROMOTE COOPERATION AMONG HEALTH CARE PROVIDERS,
8 PATIENTS AND HEALTH CARE INSURERS.
9 (3) PROVIDE FOR THE CERTIFICATION OF AND STANDARDS TO BE
10 USED BY UTILIZATION REVIEW ENTITIES.
11 (4) ESTABLISH A PROCESS FOR HEALTH CARE PROVIDERS TO
12 APPEAL DENIALS BASED ON MEDICAL NECESSITY AND
13 APPROPRIATENESS.
14 (5) REQUIRE THE ESTABLISHMENT, USE AND DISCLOSURE OF
15 PROVIDER CREDENTIALING STANDARDS.
16 (6) REQUIRE UNIFORM FORMAT AND DISCLOSURE OF THE TERMS
17 AND CONDITIONS OF HEALTH CARE INSURER CONTRACTS.
18 SECTION 3. DEFINITIONS.
19 THE FOLLOWING WORDS AND PHRASES WHEN USED IN THIS ACT SHALL
20 HAVE THE MEANINGS GIVEN TO THEM IN THIS SECTION UNLESS THE
21 CONTEXT CLEARLY INDICATES OTHERWISE:
22 "ACTIVE CLINICAL PRACTICE." THE PRACTICE OF CLINICAL
23 MEDICINE BY A HEALTH CARE PRACTITIONER FOR AN AVERAGE OF NOT
24 LESS THAN 20 HOURS PER WEEK.
25 "CLEAN CLAIM." AS DEFINED IN SECTION 1816(C)(2)(B)(I) OF THE
26 SOCIAL SECURITY ACT (49 STAT. 648, 42 U.S.C. §
27 1395H(C)(2)(B)(I)) WHICH HAS NO DEFECT OR IMPROPRIETY. A DEFECT
28 OR IMPROPRIETY UNDER THIS DEFINITION INCLUDES LACK OF REQUIRED
29 SUBSTANTIATING DOCUMENTATION OR A PARTICULAR CIRCUMSTANCE
30 REQUIRING SPECIAL TREATMENT WHICH PREVENTS TIMELY PAYMENTS FROM
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1 BEING MADE ON THE CLAIM.
2 "CLINICAL REVIEW CRITERIA." WRITTEN SCREENING PROCEDURES,
3 DECISION ABSTRACTS, CLINICAL PROTOCOLS AND PRACTICE GUIDELINES
4 USED BY A UTILIZATION REVIEW ENTITY TO EVALUATE THE MEDICAL
5 NECESSITY AND APPROPRIATENESS OF HEALTH CARE SERVICES DELIVERED
6 OR PROPOSED TO BE DELIVERED.
7 "CONCURRENT UTILIZATION REVIEW." A REVIEW BY A UTILIZATION
8 REVIEW ENTITY OF ALL NECESSARY SUPPORTING INFORMATION WHICH
9 OCCURS DURING AN ENROLLEE'S HOSPITAL STAY OR COURSE OF TREATMENT
10 AND WHICH RESULTS IN A DECISION TO APPROVE OR DENY PAYMENT FOR A
11 HEALTH CARE SERVICE.
12 "CREDENTIALING CRITERIA." THE STANDARDS USED BY A MANAGED
13 CARE ENTITY TO EVALUATE THE QUALIFICATIONS OF A HEALTH CARE
14 PRACTITIONER OR HEALTH CARE FACILITY TO PARTICIPATE IN THE
15 MANAGED CARE ENTITY'S PROVIDER NETWORKS.
16 "DENIAL." A DETERMINATION BY A MANAGED CARE ENTITY OR
17 UTILIZATION REVIEW ENTITY WHICH IS BASED UPON THE MEDICAL
18 NECESSITY AND APPROPRIATENESS OF HEALTH CARE SERVICES COVERED
19 UNDER THE TERMS AND CONDITIONS OF THE CONTRACT WHICH ARE
20 PRESCRIBED, PROVIDED OR PROPOSED TO BE PROVIDED AND WHICH:
21 (1) DISAPPROVES PAYMENT FOR A REQUESTED HEALTH CARE
22 SERVICE COMPLETELY;
23 (2) APPROVES THE PROVISION OF A REQUESTED HEALTH CARE
24 SERVICE FOR A LESSER SCOPE OR DURATION THAN REQUESTED BY A
25 HEALTH CARE PRACTITIONER OR HEALTH CARE FACILITY; OR
26 (3) DISAPPROVES PAYMENT FOR THE PROVISION OF A REQUESTED
27 HEALTH CARE SERVICE BUT APPROVES PAYMENT FOR THE PROVISION OF
28 AN ALTERNATIVE HEALTH CARE SERVICE.
29 "DEPARTMENT." THE DEPARTMENT OF HEALTH OF THE COMMONWEALTH.
30 "EMERGENCY MEDICAL CONDITION." THE SUDDEN ONSET OF A MEDICAL
19970H0977B3393 - 20 -
1 OR PSYCHIATRIC CONDITION WHICH MANIFESTS ITSELF BY ACUTE
2 SYMPTOMS OF A SUFFICIENT SEVERITY OR SEVERE PAIN SUCH THAT A
3 PRUDENT LAYPERSON WHO POSSESSES AN AVERAGE KNOWLEDGE OF HEALTH
4 AND MEDICINE COULD REASONABLY EXPECT ABSENCE OF IMMEDIATE
5 MEDICAL ATTENTION TO RESULT IN:
6 (1) PLACING THE HEALTH OF THE INDIVIDUAL OR, WITH
7 RESPECT TO A PREGNANT WOMAN, THE HEALTH OF THE WOMAN OR HER
8 UNBORN CHILD IN SERIOUS JEOPARDY;
9 (2) SERIOUS IMPAIRMENT TO BODILY FUNCTIONS; OR
10 (3) SERIOUS DYSFUNCTION OF A BODILY ORGAN OR PART.
11 "EMERGENCY HEALTH CARE SERVICES." HEALTH CARE SERVICES WHICH
12 ARE FURNISHED BY A PROVIDER AS A RESULT OF AN EMERGENCY MEDICAL
13 CONDITION.
14 "ENROLLEE." A POLICY HOLDER, SUBSCRIBER, COVERED PERSON OR
15 OTHER INDIVIDUAL, INCLUDING A DEPENDENT, ENTITLED TO RECEIVE
16 HEALTH CARE COVERAGE UNDER A MANAGED CARE ENTITY'S INSURANCE
17 POLICY OR CONTRACT ISSUED IN THIS COMMONWEALTH.
18 "HEALTH CARE FACILITY." A FACILITY PROVIDING CLINICALLY
19 RELATED HEALTH CARE SERVICES. THE TERM INCLUDES A GENERAL OR
20 SPECIAL HOSPITAL, A PSYCHIATRIC HOSPITAL, A REHABILITATION
21 HOSPITAL, AN AMBULATORY SURGICAL FACILITY, A LONG-TERM CARE
22 FACILITY, A CANCER TREATMENT CENTER USING RADIATION THERAPY ON
23 AN AMBULATORY BASIS, A BIRTHING CENTER, AN INPATIENT OR
24 OUTPATIENT DRUG AND ALCOHOL TREATMENT FACILITY, A HOME HEALTH
25 CARE FACILITY AND A HOSPICE FACILITY.
26 "HEALTH CARE PRACTITIONER." AN INDIVIDUAL WHO IS LICENSED,
27 CERTIFIED OR OTHERWISE AUTHORIZED TO PROVIDE HEALTH CARE
28 SERVICES UNDER THE LAWS OF THIS COMMONWEALTH AND WHOSE LICENSE,
29 CERTIFICATE OR AUTHORIZATION IS IN GOOD STANDING AND WITHOUT
30 RESTRICTIONS FROM THE APPROPRIATE PROFESSIONAL LICENSING AGENCY.
19970H0977B3393 - 21 -
1 "HEALTH CARE SERVICES." ANY TREATMENT, ADMISSION, PROCEDURE,
2 SERVICE, MEDICAL SUPPLIES AND EQUIPMENT, CONTINUING TREATMENT OR
3 EXTENSION OF A STAY, WHICH IS PRESCRIBED, PROVIDED OR PROPOSED
4 TO BE PROVIDED BY A HEALTH CARE PRACTITIONER OR HEALTH CARE
5 FACILITY. THE TERM INCLUDES SERVICES COVERED UNDER THE TERMS AND
6 CONDITIONS OF A MANAGED CARE PLAN CONTRACT.
7 "INTEGRATED DELIVERY SYSTEM." ANY PARTNERSHIP, ASSOCIATION,
8 AFFILIATION, CORPORATION, LIMITED LIABILITY CORPORATION OR OTHER
9 LEGAL ENTITY WHICH:
10 (1) ENTERS INTO CONTRACTUAL, RISK-SHARING ARRANGEMENTS
11 WITH MANAGED CARE ENTITIES TO PROVIDE OR ARRANGE FOR THE
12 PROVISION OF HEALTH CARE SERVICES;
13 (2) ASSUMES SOME RESPONSIBILITY FOR QUALITY ASSURANCE,
14 UTILIZATION REVIEW, PROVIDER CREDENTIALING AND RELATED
15 FUNCTIONS; AND
16 (3) ASSUMES TO SOME EXTENT, THROUGH CAPITATION
17 REIMBURSEMENT OR OTHER RISK-SHARING ARRANGEMENT, THE
18 FINANCIAL RISK FOR PROVISION OF HEALTH CARE SERVICES TO
19 ENROLLEES.
20 "MANAGED CARE ENTITY." A COMPREHENSIVE HEALTH CARE PLAN
21 WHICH INTEGRATES THE FINANCING AND DELIVERY OF HEALTH CARE
22 SERVICES, INCLUDING BEHAVIORAL HEALTH, TO ENROLLEES THROUGH A
23 NETWORK, WITH PARTICIPATING PROVIDERS SELECTED TO PARTICIPATE ON
24 THE BASIS OF SPECIFIC STANDARDS AND WHICH PROVIDES FINANCIAL
25 INCENTIVES FOR ENROLLEES TO USE THE NETWORK PROVIDERS IN
26 ACCORDANCE WITH THE PLAN'S PROCEDURES. THE TERM DOES NOT INCLUDE
27 A NETWORK WHICH IS PRIMARILY FEE-FOR-SERVICE, INDEMNITY
28 ARRANGEMENT WITH NO MANAGED CARE COMPONENT. THE TERM INCLUDES
29 HEALTH CARE PLANS PROVIDED THROUGH A POLICY OR CONTRACT
30 AUTHORIZED UNDER ANY OF THE FOLLOWING:
19970H0977B3393 - 22 -
1 (1) SECTION 630 OF THE ACT OF MAY 17, 1921 (P.L.682,
2 NO.284), KNOWN AS THE INSURANCE COMPANY LAW OF 1921.
3 (2) ACT OF DECEMBER 29, 1972 (P.L.1701, NO.364), KNOWN
4 AS THE HEALTH MAINTENANCE ORGANIZATION ACT.
5 (3) 40 PA.C.S. CH. 61 (RELATING TO HOSPITAL PLAN
6 CORPORATIONS).
7 (4) 40 PA.C.S. CH. 63 (RELATING TO PROFESSIONAL HEALTH
8 SERVICES PLAN CORPORATIONS).
9 (5) A FRATERNAL BENEFIT SOCIETY CHARTER.
10 (6) A CONTRACT WITH THE DEPARTMENT OF PUBLIC WELFARE TO
11 PROVIDE MEDICAL ASSISTANCE ON A CAPITATED BASIS.
12 "PROSPECTIVE UTILIZATION REVIEW." A REVIEW BY A UTILIZATION
13 REVIEW ENTITY OF ALL REASONABLY NECESSARY SUPPORTING INFORMATION
14 WHICH:
15 (1) RESULTS IN A DECISION TO APPROVE OR DENY PAYMENT FOR
16 A HEALTH CARE SERVICE; AND
17 (2) OCCURS PRIOR TO THE DELIVERY OR PROVISION OF THE
18 HEALTH CARE SERVICE.
19 "PROVIDER NETWORK." THE HEALTH CARE PRACTITIONERS AND HEALTH
20 CARE FACILITIES DESIGNATED BY A MANAGED CARE ENTITY TO PROVIDE
21 COVERED HEALTH CARE SERVICES TO AN ENROLLEE.
22 "PROVIDER." THE HEALTH CARE PRACTITIONER OR HEALTH CARE
23 FACILITY THAT PRESCRIBES, PROVIDES OR PROPOSES TO PROVIDE A
24 HEALTH CARE SERVICE TO AN ENROLLEE.
25 "RETROSPECTIVE UTILIZATION REVIEW." A REVIEW BY A
26 UTILIZATION REVIEW ENTITY OF ALL NECESSARY SUPPORTING
27 INFORMATION WHICH:
28 (1) RESULTS IN A DECISION TO APPROVE OR DENY PAYMENT FOR
29 A HEALTH CARE SERVICE; AND
30 (2) OCCURS FOLLOWING DELIVERY OR PROVISION OF THE HEALTH
19970H0977B3393 - 23 -
1 CARE SERVICE.
2 "UTILIZATION REVIEW." A SYSTEM OF PROSPECTIVE, CONCURRENT OR
3 RETROSPECTIVE UTILIZATION REVIEW OR CASE MANAGEMENT PERFORMED BY
4 A UTILIZATION REVIEW ENTITY OF THE MEDICAL NECESSITY AND
5 APPROPRIATENESS OF COVERED HEALTH CARE SERVICES PRESCRIBED,
6 PROVIDED OR PROPOSED TO BE PROVIDED TO AN ENROLLEE. THE TERM
7 DOES NOT INCLUDE ANY OF THE FOLLOWING:
8 (1) REQUESTS FOR CLARIFICATION OF COVERAGE, ELIGIBILITY
9 VERIFICATION OR BENEFITS VERIFICATION.
10 (2) AN INTERNAL QUALITY ASSURANCE OR UTILIZATION REVIEW
11 PROCESS OF A PROVIDER UNLESS THE REVIEW RESULTS IN A DENIAL.
12 "UTILIZATION REVIEW ENTITY." AN ENTITY THAT PERFORMS
13 UTILIZATION REVIEW ON BEHALF OF A MANAGED CARE ENTITY PROVIDING
14 COVERAGE TO RESIDENTS OF THIS COMMONWEALTH.
15 SECTION 4. CERTIFICATION OF UTILIZATION REVIEW ENTITY.
16 (A) CERTIFICATION REQUIRED.--
17 (1) EXCEPT AS SET FORTH IN PARAGRAPH (2), A UTILIZATION
18 REVIEW ENTITY MAY NOT CONDUCT UTILIZATION REVIEW REGARDING
19 HEALTH CARE SERVICES DELIVERED OR PROPOSED TO BE DELIVERED IN
20 THIS COMMONWEALTH UNLESS THE ENTITY IS CERTIFIED BY THE
21 DEPARTMENT TO PERFORM A UTILIZATION REVIEW.
22 (2) PARAGRAPH (1) SHALL NOT APPLY TO A UTILIZATION
23 REVIEW ENTITY OPERATING IN THIS COMMONWEALTH ON JULY 1, 1998,
24 FOR ONE YEAR FOLLOWING THE EFFECTIVE DATE OF THIS SECTION.
25 (B) RENEWAL.--CERTIFICATION MUST BE RENEWED EVERY THREE
26 YEARS UNLESS OTHERWISE SUSPENDED OR REVOKED BY THE DEPARTMENT.
27 (C) ACCREDITING BODIES.--THE DEPARTMENT MAY UTILIZE A
28 NATIONALLY RECOGNIZED ACCREDITING BODY'S STANDARDS TO CERTIFY
29 UTILIZATION REVIEW ENTITIES TO THE EXTENT THAT THE ACCREDITING
30 BODY'S STANDARDS MEET OR EXCEED THE STANDARDS SET FORTH IN
19970H0977B3393 - 24 -
1 SECTION 5 IF THE ENTITY AGREES TO DO ALL OF THE FOLLOWING:
2 (1) DIRECT THE ACCREDITING BODY TO PROVIDE A COPY OF ITS
3 FINDINGS TO THE DEPARTMENT.
4 (2) PERMIT THE DEPARTMENT TO VERIFY COMPLIANCE WITH
5 STANDARDS NOT ADDRESSED BY THE ACCREDITING BODY.
6 (D) STANDARD.--THE DEPARTMENT SHALL GRANT CERTIFICATION TO A
7 UTILIZATION REVIEW ENTITY WHICH MEETS THE APPLICABLE
8 REQUIREMENTS OF SECTIONS 5, 6, 7 AND 8.
9 (E) FEES.--THE DEPARTMENT MAY PRESCRIBE FEES FOR APPLICATION
10 FOR AND RENEWAL OF CERTIFICATION. THE FEES SHALL REFLECT THE
11 ADMINISTRATIVE COSTS OF CERTIFICATION.
12 (F) MANAGED CARE ENTITIES AND INTEGRATED DELIVERY SYSTEMS.--
13 (1) A MANAGED CARE ENTITY SHALL COMPLY WITH THE
14 STANDARDS AND PROCEDURES OF THIS ACT, BUT IS NOT REQUIRED TO
15 BE SEPARATELY CERTIFIED AS A UTILIZATION REVIEW ENTITY.
16 (2) AN INTEGRATED DELIVERY SYSTEM UNDER A CONTRACT WHICH
17 HAS BEEN APPROVED BY THE DEPARTMENT IS NOT REQUIRED TO BE
18 SEPARATELY CERTIFIED AS A UTILIZATION REVIEW ENTITY.
19 SECTION 5. UTILIZATION REVIEW OPERATIONAL STANDARDS.
20 (A) REQUIREMENTS.--UTILIZATION REVIEW ENTITIES PROVIDING
21 SERVICES IN THIS COMMONWEALTH SHALL COMPLY WITH ALL OF THE
22 FOLLOWING:
23 (1) RESPOND TO INQUIRIES RELATING TO THE ENTITY'S
24 UTILIZATION REVIEW DETERMINATIONS BY:
25 (I) PROVIDING TOLL-FREE TELEPHONE ACCESS AT LEAST 40
26 HOURS PER WEEK DURING NORMAL BUSINESS HOURS;
27 (II) MAINTAINING A TELEPHONE CALL ANSWERING SERVICE
28 OR RECORDING SYSTEM DURING HOURS OTHER THAN NORMAL
29 BUSINESS HOURS; AND
30 (III) RESPONDING BY MAIL OR OTHER MEANS TO EACH
19970H0977B3393 - 25 -
1 TELEPHONE CALL REGARDING A REVIEW DETERMINATION RECEIVED
2 BY THE ANSWERING SERVICE OR RECORDING SYSTEM WITHIN ONE
3 BUSINESS DAY AFTER THE RECEIPT OF THE CALL.
4 (2) PROTECT THE CONFIDENTIALITY OF INDIVIDUAL MEDICAL
5 RECORDS BY:
6 (I) COMPLYING WITH ALL APPLICABLE FEDERAL AND STATE
7 LAWS AND PROFESSIONAL ETHICAL STANDARDS TO ENSURE THAT AN
8 ENROLLEE'S MEDICAL RECORDS AND OTHER CONFIDENTIAL MEDICAL
9 INFORMATION OBTAINED IN THE PERFORMANCE OF UTILIZATION
10 REVIEW ARE NOT IMPROPERLY DISCLOSED OR REDISCLOSED;
11 (II) ONLY REQUESTING MEDICAL RECORDS AND OTHER
12 INFORMATION WHICH ARE NECESSARY TO MAKE A UTILIZATION
13 REVIEW DETERMINATION FOR THE HEALTH CARE SERVICES UNDER
14 REVIEW;
15 (III) ADOPTING MECHANISMS TO ALLOW A PROVIDER OF
16 RECORD TO VERIFY THAT AN INDIVIDUAL REQUESTING
17 INFORMATION ON BEHALF OF THE MANAGED CARE ENTITY IS A
18 LEGITIMATE REPRESENTATIVE OF THE ENTITY; AND
19 (IV) DEEMING A COMMONWEALTH OFFICIAL, WHO IS ACTING
20 ON BEHALF OF A CONSUMER AND WHO REQUESTS IN WRITING
21 SPECIFIC INFORMATION FROM THE MANAGED CARE ENTITY OR ITS
22 AGENTS, TO HAVE THE CONSENT OF THE CONSUMER TO RELEASE
23 THE INFORMATION SPECIFIC TO THE REQUEST.
24 (3) RENDER UTILIZATION REVIEW DECISIONS BASED ON THE
25 MEDICAL NECESSITY AND APPROPRIATENESS OF THE HEALTH CARE
26 SERVICE BEING REVIEWED.
27 (4) PROVIDE AN APPEALS PROCESS CONSISTENT WITH THE
28 PROVISIONS OF THIS ACT.
29 (5) MAINTAIN AND MAKE AVAILABLE A WRITTEN DESCRIPTION OF
30 ALL APPEALS AND RELATED PROCEDURES BY WHICH A PROVIDER MAY
19970H0977B3393 - 26 -
1 SEEK REVIEW OF A DENIAL.
2 (6) ENSURE THAT PERSONNEL CONDUCTING UTILIZATION REVIEW
3 HAVE CURRENT LICENSES IN GOOD STANDING AND WITHOUT
4 RESTRICTIONS FROM THE APPROPRIATE PROFESSIONAL LICENSING
5 AGENCY.
6 (7) COMPLY WITH ALL TIME FRAMES SET FORTH IN THIS ACT.
7 (8) PROVIDE WRITTEN DENIALS TO INCLUDE:
8 (I) THE SPECIFIC CLINICAL CRITERIA AND THE PRINCIPAL
9 REASONS FOR THE DECISION; AND
10 (II) A DESCRIPTION OF THE PROCEDURE BY WHICH THE
11 PROVIDER MAY APPEAL A DENIAL, INCLUDING THE NAME AND
12 TELEPHONE NUMBER OF THE PERSON TO CONTACT IN REGARD TO AN
13 APPEAL AND THE DEADLINE FOR FILING AN APPEAL.
14 (9) MAINTAIN FOR NOT LESS THAN THREE YEARS A WRITTEN
15 RECORD OF EACH UTILIZATION REVIEW DENIAL, INCLUDING A
16 DETAILED JUSTIFICATION OF THE DENIAL AND THE NOTIFICATION TO
17 THE PROVIDER AND THE ENROLLEE.
18 (10) NOTIFY THE PROVIDER OF RECORD OF THE SPECIFIC FACTS
19 OR DOCUMENTS REQUIRED TO COMPLETE THE UTILIZATION REVIEW
20 WITHIN 48 HOURS OF RECEIPT OF THE REQUEST FOR REVIEW IF THE
21 UTILIZATION REVIEW ENTITY LACKS NECESSARY SUPPORTING
22 INFORMATION.
23 (11) PROVIDE A PERIOD OF AT LEAST 24 HOURS FOLLOWING AN
24 EMERGENCY HEALTH CARE SERVICE DURING WHICH THE PROVIDER,
25 ENROLLEE OR ENROLLEE'S DESIGNEE MAY NOTIFY A MANAGED CARE
26 ENTITY AND REQUEST THE APPROVAL FOR CONTINUATION OF HEALTH
27 CARE SERVICES FOR THE CONDITION UNDER REVIEW.
28 (B) COMPENSATION.--COMPENSATION TO ANY PERSON PERFORMING
29 UTILIZATION REVIEW ACTIVITIES MAY NOT CONTAIN INCENTIVES, DIRECT
30 OR INDIRECT, FOR THE PERSON TO APPROVE OR DENY PAYMENT FOR THE
19970H0977B3393 - 27 -
1 DELIVERY OR COVERAGE OF HEALTH CARE SERVICES.
2 (C) ALTERNATIVE RESOLUTION.--MANAGED CARE ENTITIES AND
3 PROVIDERS MAY ESTABLISH BY CONTRACT ALTERNATIVE UTILIZATION
4 REVIEW STANDARDS, PRACTICES AND PROCEDURES WHICH MEET OR EXCEED
5 THE REQUIREMENTS OF SUBSECTION (A) AND ARE APPROVED BY THE
6 DEPARTMENT.
7 SECTION 6. INITIAL UTILIZATION REVIEW DECISIONS.
8 (A) REVIEW.--AN INITIAL UTILIZATION REVIEW WHICH RESULTS IN
9 A DENIAL MUST BE MADE BY A LICENSED PHYSICIAN.
10 (B) NOTIFICATION.--NOTIFICATION OF AN INITIAL UTILIZATION
11 REVIEW DECISION SHALL BE MADE WITHIN THE FOLLOWING TIME FRAMES:
12 (1) A PROSPECTIVE UTILIZATION REVIEW DECISION SHALL BE
13 COMMUNICATED TO THE PROVIDER AND, IN THE CASE OF A DENIAL, TO
14 THE ENROLLEE WITHIN 48 HOURS OF THE RECEIPT OF ALL SUPPORTING
15 INFORMATION NECESSARY TO COMPLETE THE REVIEW.
16 (2) A CONCURRENT UTILIZATION REVIEW DECISION SHALL BE
17 COMMUNICATED TO THE PROVIDER AND, IN THE CASE OF A DENIAL, TO
18 THE ENROLLEE WITHIN 24 HOURS OF THE RECEIPT OF ALL SUPPORTING
19 INFORMATION NECESSARY TO COMPLETE THE REVIEW.
20 (3) A RETROSPECTIVE UTILIZATION REVIEW DECISION SHALL BE
21 COMMUNICATED TO THE PROVIDER AND, IN THE CASE OF A DENIAL, TO
22 THE ENROLLEE WITHIN 30 DAYS OF THE RECEIPT OF ALL SUPPORTING
23 INFORMATION NECESSARY TO COMPLETE THE REVIEW.
24 SECTION 7. INTERNAL APPEALS.
25 A DENIAL MAY BE APPEALED BY THE PROVIDER, WITH THE CONSENT OF
26 THE ENROLLEE, TO AN INTERNAL APPEALS PROCESS UNDER SECTION
27 5(A)(4). THE INTERNAL APPEALS PROCESS MUST DO ALL OF THE
28 FOLLOWING:
29 (1) INCLUDE A TIME PERIOD OF 45 DAYS FOLLOWING RECEIPT
30 OF THE WRITTEN NOTIFICATION OF DENIAL WITHIN WHICH AN APPEAL
19970H0977B3393 - 28 -
1 MAY BE FILED. THE NOTIFICATION OF DENIAL MUST INCLUDE THE
2 NAME, ADDRESS AND TELEPHONE NUMBER OF THE ENTITY TO WHICH THE
3 PROVIDER MAY APPEAL THE DENIAL.
4 (2) NOTIFY THE PROVIDER AND THE ENROLLEE OF A DECISION
5 NO LATER THAN 45 DAYS FROM THE DATE THE APPEAL AND ALL
6 NECESSARY SUPPORTING INFORMATION IS FILED.
7 (3) ENSURE THAT A DENIAL RESULTING FROM AN INTERNAL
8 APPEAL UNDER THIS SECTION IS MADE BY A LICENSED PHYSICIAN IN
9 THE SAME OR SIMILAR SPECIALTY WHICH TYPICALLY MANAGES OR
10 CONSULTS ON THE HEALTH CARE SERVICES. THE PHYSICIAN WHO
11 RENDERED AN INITIAL DENIAL MAY NOT RENDER A DECISION ON AN
12 APPEAL OF THAT DENIAL.
13 (4) PROVIDE AN EXPEDITED INTERNAL APPEALS PROCESS FOR A
14 SITUATION IN WHICH THE ENROLLEE'S LIFE OR HEALTH WOULD BE
15 SERIOUSLY JEOPARDIZED OR THE ENROLLEE'S ABILITY TO REGAIN
16 MAXIMUM FUNCTION WOULD BE JEOPARDIZED. THIS PARAGRAPH
17 INCLUDES NOTIFICATION OF THE PROVIDER AND ENROLLEE WITHIN 48
18 HOURS OF THE TIME THE APPEAL WAS FILED.
19 (5) MAINTAIN RECORDS OF INTERNAL APPEALS AND THE
20 RESULTING DETERMINATIONS FOR NOT LESS THAN THREE YEARS AND
21 PROVIDE THE RECORDS TO THE DEPARTMENT UPON REQUEST.
22 SECTION 8. INDEPENDENT EXTERNAL REVIEW PROCESS.
23 (A) REQUIREMENTS.--A MANAGED CARE ENTITY SHALL ESTABLISH AN
24 INDEPENDENT EXTERNAL REVIEW PROCESS TO WHICH A PROVIDER MAY
25 APPEAL A DENIAL BY THE INTERNAL PROCESS. THE INDEPENDENT
26 EXTERNAL REVIEW PROCESS MUST MEET THE FOLLOWING REQUIREMENTS:
27 (1) THE PROVIDER MAY INITIATE THE INDEPENDENT EXTERNAL
28 REVIEW WITHIN 15 DAYS OF RECEIPT OF A DENIAL BY THE INTERNAL
29 APPEALS PROCESS BY:
30 (I) SUBMITTING A WRITTEN NOTICE, INCLUDING ANY
19970H0977B3393 - 29 -
1 MATERIAL JUSTIFICATION AND ALL NECESSARY SUPPORTING
2 INFORMATION, TO THE MANAGED CARE ENTITY; AND
3 (II) NOTIFYING THE ENROLLEE AND THE DEPARTMENT THAT
4 AN INDEPENDENT EXTERNAL REVIEW HAS BEEN REQUESTED.
5 (2) THE UTILIZATION REVIEW ENTITY WHICH CONDUCTED THE
6 INTERNAL APPEAL SHALL FORWARD COPIES OF ALL WRITTEN
7 DOCUMENTATION ASSOCIATED WITH THE DENIAL, INCLUDING ALL
8 NECESSARY SUPPORTING INFORMATION, A SUMMARY OF APPLICABLE
9 ISSUES, A STATEMENT OF THE UTILIZATION REVIEW ENTITY'S
10 DECISION, THE CRITERIA USED AND THE CLINICAL REASONS FOR THE
11 DECISION, TO THE INDEPENDENT EXTERNAL REVIEW ENTITY WITHIN 15
12 DAYS OF THE RECEIPT OF THE REQUEST FOR REVIEW. THE MANAGED
13 CARE ENTITY SHALL NOTIFY THE PROVIDER OF THE NAME, ADDRESS
14 AND TELEPHONE NUMBER OF THE SELECTED INDEPENDENT REVIEW
15 ENTITY.
16 (3) INDEPENDENT EXTERNAL REVIEW DECISIONS SHALL BE MADE
17 BY:
18 (I) ONE OR MORE LICENSED PHYSICIANS IN ACTIVE
19 CLINICAL PRACTICE OR IN THE SAME OR SIMILAR SPECIALTY
20 WHICH TYPICALLY MANAGES OR RECOMMENDS TREATMENT FOR THE
21 HEALTH CARE SERVICE UNDER REVIEW; OR
22 (II) ONE OR MORE PHYSICIANS CURRENTLY CERTIFIED BY
23 A BOARD APPROVED BY THE AMERICAN BOARD OF MEDICAL
24 SPECIALTIES OR THE AMERICAN BOARD OF OSTEOPATHIC
25 SPECIALTIES, IN THE SAME OR SIMILAR SPECIALTY WHICH
26 TYPICALLY MANAGES OR RECOMMENDS TREATMENT FOR THE HEALTH
27 CARE SERVICE UNDER REVIEW.
28 (4) THE INDEPENDENT EXTERNAL REVIEW ENTITY SHALL
29 EVALUATE AND ANALYZE THE CASE AND RENDER A WRITTEN DECISION
30 TO THE MANAGED CARE ENTITY AND THE PROVIDER WITHIN 30 DAYS.
19970H0977B3393 - 30 -
1 THE STANDARD OF REVIEW SHALL BE WHETHER THE DENIAL BY THE
2 INTERNAL APPEAL WAS MEDICALLY NECESSARY AND APPROPRIATE. THE
3 DECISION SHALL BE SUBJECT TO APPEAL TO A COURT OF COMPETENT
4 JURISDICTION WITHIN 60 DAYS OF RECEIPT OF THE EXTERNAL REVIEW
5 ENTITY'S WRITTEN DECISION. THERE SHALL BE A REBUTTABLE
6 PRESUMPTION IN FAVOR OF THE DECISION OF THE INDEPENDENT
7 EXTERNAL REVIEW ENTITY.
8 (5) THE MANAGED CARE ENTITY SHALL AUTHORIZE ANY COVERED
9 HEALTH CARE SERVICE OR PAY ANY CLAIM DETERMINED TO BE
10 MEDICALLY NECESSARY AND APPROPRIATE UNDER PARAGRAPH (4),
11 WHETHER OR NOT AN APPEAL TO A COURT OF COMPETENT JURISDICTION
12 HAS BEEN FILED. IF THE MANAGED CARE ENTITY FAILS TO AUTHORIZE
13 THE HEALTH CARE SERVICE OR PAY THE CLAIM WITHIN 15 DAYS OF
14 RECEIPT OF NOTICE OF APPROVAL BY THE INDEPENDENT EXTERNAL
15 REVIEW ENTITY, INTEREST SHALL BE ASSESSED AT A RATE OF 10%
16 PER YEAR, NOTWITHSTANDING THE 45-DAY PERIOD IN SECTION 12.
17 (6) ALL FEES AND COSTS RELATED TO AN INDEPENDENT
18 EXTERNAL REVIEW SHALL BE PAID BY THE NONPREVAILING PARTY. THE
19 PROVIDER AND THE UTILIZATION REVIEW ENTITY OR MANAGED CARE
20 ENTITY SHALL EACH PLACE IN ESCROW AN AMOUNT EQUAL TO ONE-HALF
21 OF THE ESTIMATED COSTS OF THE INDEPENDENT EXTERNAL REVIEW.
22 THE ESCROW SHALL BE HELD BY THE INDEPENDENT EXTERNAL REVIEW
23 ENTITY.
24 (B) CERTIFIED UTILIZATION REVIEW.--THE DEPARTMENT SHALL
25 COMPILE AND MAINTAIN A LIST OF CERTIFIED UTILIZATION REVIEW
26 ENTITIES THAT MEET THE REQUIREMENTS OF THIS SECTION AND THAT ARE
27 QUALIFIED TO PERFORM INDEPENDENT EXTERNAL REVIEWS. THE
28 DEPARTMENT MAY REMOVE AN INDEPENDENT EXTERNAL REVIEW ENTITY FROM
29 THE LIST IF THE DEPARTMENT DETERMINES THAT THE ENTITY IS
30 INCAPABLE OF PERFORMING ITS RESPONSIBILITIES OR VIOLATES THIS
19970H0977B3393 - 31 -
1 ACT.
2 (C) ASSIGNMENT.--
3 (1) THE DEPARTMENT SHALL RANDOMLY ASSIGN REQUESTS FOR AN
4 INDEPENDENT EXTERNAL REVIEW TO THOSE CERTIFIED UTILIZATION
5 REVIEW ENTITIES LISTED IN SUBSECTION (B) WITHIN ONE BUSINESS
6 DAY OF RECEIVING A REQUEST PURSUANT TO SUBSECTION (A)(1).
7 (2) IF THE 8 HOURS DURING WHICH THE DEPARTMENT IS OPEN
8 TO THE PUBLIC EXPIRE AND THE DEPARTMENT FAILS TO SELECT THE
9 UTILIZATION REVIEW ENTITY AT RANDOM, THE MANAGED CARE ENTITY
10 SHALL DESIGNATE THE UTILIZATION REVIEW ENTITY CERTIFIED UNDER
11 SECTION 4 AND SUBSECTION (B) TO CONDUCT THE INDEPENDENT
12 EXTERNAL REVIEW.
13 (3) THE DEPARTMENT SHALL REPORT ANNUALLY TO THE GENERAL
14 ASSEMBLY ITS FINDINGS BASED ON INFORMATION IT RECEIVES
15 PURSUANT TO SUBSECTION (D)(4). THE REPORT SHALL INCLUDE A
16 SUMMARY OF ANY COMPLAINTS IT HAS RECEIVED CONCERNING ENTITIES
17 LISTED UNDER THIS SECTION AND ANY CORRECTIVE ACTIONS IT HAS
18 TAKEN AS A RESULT OF SUCH COMPLAINTS. THE DEPARTMENT SHALL
19 MAKE ITS ANNUAL REPORT AVAILABLE TO THE PUBLIC.
20 (D) PROCEDURE.--THE INDEPENDENT EXTERNAL REVIEW ENTITY SHALL
21 DO ALL OF THE FOLLOWING:
22 (1) MAIL WRITTEN ACKNOWLEDGMENT OF THE RECEIPT OF THE
23 NOTICE OF APPEAL TO THE PROVIDER, THE MANAGED CARE ENTITY AND
24 THE UTILIZATION REVIEW ENTITY WHICH PERFORMED THE INTERNAL
25 APPEAL.
26 (2) REVIEW THE INFORMATION CONSIDERED BY THE ENTITIES
27 WHICH CONDUCTED THE INITIAL UTILIZATION REVIEW AND THE
28 INTERNAL APPEAL TO REACH A DECISION TO DENY PAYMENT FOR
29 HEALTH CARE SERVICES AND ANY OTHER WRITTEN SUBMISSIONS BY THE
30 PROVIDER.
19970H0977B3393 - 32 -
1 (3) MAIL TO THE PROVIDER, THE UTILIZATION REVIEW ENTITY
2 AND THE MANAGED CARE ENTITY A WRITTEN NOTICE DESCRIBING
3 SPECIFIC UTILIZATION REVIEW CRITERIA AND THE PRINCIPAL
4 REASONS FOR THE DENIAL OF PAYMENT FOR HEALTH CARE SERVICES BY
5 THE INDEPENDENT EXTERNAL REVIEW ENTITY. NOTICE OF THE
6 DECISION SHALL ALSO BE SENT TO THE ENROLLEE.
7 (4) REPORT TO THE DEPARTMENT THE NUMBER, TYPE AND
8 DISPOSITION OF EACH APPEAL EVERY SIX MONTHS. THE REPORT SHALL
9 INCLUDE THE NAMES OF THE PROVIDERS, UTILIZATION REVIEW
10 ENTITIES AND MANAGED CARE ENTITIES INVOLVED AND WHETHER THE
11 UTILIZATION REVIEW ENTITY WAS SELECTED AT RANDOM OR CHOSEN BY
12 THE MANAGED CARE ENTITY.
13 (E) FEES.--FEES TO FILE FOR AN INDEPENDENT EXTERNAL REVIEW
14 MAY NOT EXCEED FEES ESTABLISHED BY THE MEDICARE PROGRAM FOR
15 SIMILAR CONSULTATIONS, UNLESS OTHERWISE AGREED BY THE PARTIES TO
16 THE APPEAL AND THE INDEPENDENT EXTERNAL REVIEW ENTITY.
17 (F) ALTERNATIVE DISPUTE RESOLUTION.--WRITTEN CONTRACTS
18 BETWEEN MANAGED CARE ENTITIES AND PROVIDERS MAY PROVIDE FOR AN
19 ALTERNATIVE DISPUTE RESOLUTION SYSTEM TO THE INDEPENDENT
20 EXTERNAL REVIEW IF THE DEPARTMENT APPROVES THE CONTRACT. THE
21 ALTERNATIVE DISPUTE RESOLUTION SYSTEM MUST INCLUDE SPECIFIC TIME
22 LIMITATIONS TO INITIATE APPEAL, RECEIVE WRITTEN INFORMATION,
23 CONDUCT A HEARING AND RENDER A FINAL DECISION; PROVIDE FOR
24 IMPARTIAL REVIEWERS THAT MEET THE REQUIREMENTS OF SECTION 5(A);
25 AND REQUIRE THAT REVIEWERS BE LICENSED CONSISTENT WITH
26 SUBSECTION (A)(3). A WRITTEN DECISION PURSUANT TO AN ALTERNATIVE
27 DISPUTE RESOLUTION SYSTEM SHALL BE FINAL AND BINDING ON ALL
28 PARTIES.
29 (G) CONSUMER GRIEVANCES.--NOTHING IN THIS SECTION SHALL
30 INTERFERE WITH AN ENROLLEE'S RIGHT TO ACCESS A CONSUMER
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1 GRIEVANCE PROCESS.
2 (H) CONFIDENTIALITY.--THE PROCEEDINGS, DELIBERATIONS AND
3 RECORDS OF A MANAGED CARE ENTITY REGARDING UTILIZATION REVIEW OF
4 HEALTH CARE SERVICES SHALL BE CONFIDENTIAL AND MAY NOT BE
5 SUBJECT TO DISCOVERY OR ENTERED INTO EVIDENCE IN ANY CIVIL
6 ACTION WITH THE EXCEPTION OF APPEALS UNDER SUBSECTION (A)(4)
7 AGAINST A MANAGED CARE ENTITY TO THE SAME DEGREE THAT SUCH
8 INFORMATION IS PROTECTED BY THE ACT OF JULY 20, 1974 (P.L.564,
9 NO.193), KNOWN AS THE PEER REVIEW PROTECTION ACT. INDIVIDUALS
10 SUPPLYING SUCH INFORMATION OR PARTICIPATING IN THEIR USE SHALL
11 BE ENTITLED TO THE SAME IMMUNITIES AS PROVIDED UNDER THAT ACT.
12 SECTION 9. PARTICIPATING PROVIDERS.
13 (A) REQUIREMENTS.--A MANAGED CARE ENTITY SHALL DO ALL OF THE
14 FOLLOWING:
15 (1) ENSURE THAT THERE ARE SUFFICIENT HEALTH CARE
16 PRACTITIONERS AND HEALTH CARE FACILITIES WITHIN A PROVIDER
17 NETWORK TO PROVIDE ENROLLEES WITH ACCESS TO QUALITY HEALTH
18 CARE SERVICES IN A TIMELY FASHION.
19 (2) CONSULT WITH HEALTH CARE PRACTITIONERS IN ACTIVE
20 CLINICAL PRACTICE REGARDING THE PROFESSIONAL QUALIFICATIONS,
21 SPECIALTY AND GEOGRAPHIC COMPOSITION OF THE PROVIDER NETWORK.
22 (3) REPORT THE COMPOSITION OF ITS PROVIDER NETWORK,
23 INCLUDING THE EXTENT TO WHICH PROVIDERS IN THE NETWORK ARE
24 ACCEPTING NEW ENROLLEES, TO THE DEPARTMENT:
25 (I) EVERY TWO YEARS;
26 (II) AFTER SIGNIFICANT CHANGES IN THE PROVIDER
27 NETWORK; AND
28 (III) AS OFTEN AS REQUIRED BY THE DEPARTMENT.
29 (B) PROHIBITIONS.--A MANAGED CARE ENTITY MAY NOT
30 DISCRIMINATE AGAINST PATIENTS WITH EXPENSIVE MEDICAL CONDITIONS
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1 BY EXCLUDING FROM ITS NETWORK HEALTH CARE PRACTITIONERS WITH
2 PRACTICES WHICH INCLUDE A SUBSTANTIAL NUMBER OF SUCH PATIENTS,
3 CONSISTENT WITH THE CRITERIA SET FORTH IN SECTION 10.
4 SECTION 10. PROVIDER CREDENTIALING.
5 (A) PROCESS.--
6 (1) A MANAGED CARE ENTITY SHALL ESTABLISH A FORMAL
7 CREDENTIALING PROCESS TO ENROLL THE PARTICIPATING HEALTH CARE
8 PRACTITIONERS AND HEALTH CARE FACILITIES FOR A PROVIDER
9 NETWORK. THE PROCESS SHALL INCLUDE WRITTEN CRITERIA AND
10 PROCESSES FOR INITIAL ENROLLMENT, RENEWAL, RESTRICTIONS AND
11 TERMINATION. THE MANAGED CARE ENTITY SHALL REPORT ON THE
12 ESTABLISHED CREDENTIALING CRITERIA AND PROCEDURES TO THE
13 DEPARTMENT:
14 (I) EVERY TWO YEARS;
15 (II) AFTER SIGNIFICANT CHANGES IN THE CRITERIA OR
16 PROCESS; AND
17 (III) AS OFTEN AS REQUIRED BY THE DEPARTMENT.
18 (2) THE CRITERIA AND PROCEDURES MUST BE APPROVED BY THE
19 DEPARTMENT. THE DEPARTMENT MAY UTILIZE A NATIONALLY
20 RECOGNIZED ACCREDITING BODY'S STANDARDS FOR PROVIDER
21 CREDENTIALING.
22 (3) THE MANAGED CARE ENTITY'S COMPLIANCE WITH THE
23 PURPOSES OF SECTION 2 SHALL BE MONITORED BY THE DEPARTMENT TO
24 ENSURE COMPLIANCE.
25 (B) DISCLOSURE.--A MANAGED CARE ENTITY SHALL DISCLOSE ALL
26 CREDENTIALING CRITERIA AND PROCEDURES TO HEALTH CARE
27 PRACTITIONERS AND HEALTH CARE FACILITIES THAT APPLY TO
28 PARTICIPATE OR ARE PARTICIPATING IN ITS NETWORK. THE
29 PROCEEDINGS, DELIBERATIONS AND RECORDS OF A MANAGED CARE ENTITY
30 REGARDING THE CREDENTIALING OF HEALTH CARE PROVIDERS SHALL BE
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1 CONFIDENTIAL, MAY NOT BE SUBJECT TO DISCOVERY AND MAY NOT BE
2 ENTERED INTO EVIDENCE IN A CIVIL ACTION AGAINST A MANAGED CARE
3 ENTITY, TO THE SAME DEGREE THAT SUCH INFORMATION IS PROTECTED BY
4 THE PEER REVIEW PROTECTION ACT. INDIVIDUALS SUPPLYING SUCH
5 INFORMATION OR PARTICIPATING IN THEIR USE SHALL BE ENTITLED THE
6 SAME IMMUNITIES AS PROVIDED UNDER THAT ACT.
7 (C) EXCLUSION PROHIBITED.--A MANAGED CARE ENTITY MAY NOT
8 EXCLUDE OR TERMINATE A HEALTH CARE PRACTITIONER OR HEALTH CARE
9 FACILITY FROM ITS PROVIDER NETWORK BECAUSE THE PRACTITIONER OR
10 FACILITY ADVOCATED FOR MEDICALLY APPROPRIATE HEALTH CARE;
11 ADVOCATED ON BEHALF OF A PATIENT OR HEALTH CARE SERVICE IN ANY
12 UTILIZATION REVIEW, APPEAL OR OTHER DISPUTE REGARDING THE
13 PROVISION OF HEALTH CARE SERVICES; OR PROTESTED A DECISION,
14 POLICY OR PRACTICE OF A MANAGED CARE ENTITY OR OTHER HEALTH
15 INSURER.
16 (D) PROVIDER CONSCIENCE CLAUSE.--A MANAGED CARE ENTITY MAY
17 NOT EXCLUDE, DISCRIMINATE AGAINST OR PENALIZE ANY PROVIDER FOR
18 ITS REFUSAL TO ALLOW, PERFORM, PARTICIPATE IN OR REFER FOR
19 HEALTH CARE SERVICES, WHEN SUCH REFUSAL OF THE PROVIDER IS BY
20 REASON OF MORAL OR RELIGIOUS GROUNDS PROVIDED THAT PROVIDER
21 MAKES AVAILABLE SUCH INFORMATION TO ENROLLEES OR, IF APPLICABLE,
22 PROSPECTIVE ENROLLEES.
23 (E) WRITTEN DECISIONS.--IF A MANAGED CARE ENTITY DENIES
24 CREDENTIALING OR RECREDENTIALING TO AN APPLICANT, THE MANAGED
25 CARE ENTITY SHALL PROVIDE THE HEALTH CARE PRACTITIONER OR HEALTH
26 CARE FACILITY WITH WRITTEN NOTICE OF THE DECISION TO DENY
27 CREDENTIALING. THE NOTICE MUST INCLUDE A CLEAR EXPLANATION OF
28 THE BASIS FOR THE DECISION.
29 SECTION 11. UNIFORM DISCLOSURE.
30 (A) FORMAT.--THE INSURANCE DEPARTMENT SHALL ADOPT A UNIFORM
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1 FORMAT FOR THE DISCLOSURE TO ENROLLEES OF THE TERMS AND
2 CONDITIONS OF HEALTH INSURANCE PLANS AND CONTRACTS TO PROVIDE
3 HEALTH CARE SERVICES.
4 (B) CONTENTS.--THE UNIFORM FORMAT SHALL INCLUDE, AT A
5 MINIMUM, THE FOLLOWING PROVISIONS WRITTEN IN TERMS
6 UNDERSTANDABLE TO THE GENERAL PUBLIC:
7 (1) THE BENEFITS AND ANY AND ALL EXCLUSIONS.
8 (2) ALL ENROLLEE COINSURANCE, COPAYMENTS AND
9 DEDUCTIBLES.
10 (3) ALL MAXIMUM BENEFIT LIMITATIONS.
11 (4) ALL REQUIREMENTS OR LIMITATIONS REGARDING THE CHOICE
12 OF PROVIDER.
13 (5) DESCRIPTION OF ANY AND ALL RESTRICTIONS OR
14 LIMITATIONS ON PRESCRIPTION DRUGS AND BIOLOGICALS, INCLUDING
15 ANY PRIOR AUTHORIZATION OR OTHER REVIEW REQUIREMENTS.
16 (6) DISCLOSURE OF PROVIDER INCENTIVE PLANS.
17 (7) ENROLLEE SATISFACTION STATISTICS.
18 (C) MANDATORY USE.--MANAGED CARE ENTITIES SHALL USE THE
19 FORMAT ADOPTED BY THE INSURANCE DEPARTMENT TO MAKE THE REQUIRED
20 INFORMATION AVAILABLE TO PURCHASERS AND POTENTIAL ENROLLEES.
21 SECTION 12. PROMPT PAYMENT OF CLEAN CLAIMS.
22 (A) REQUIREMENTS.--A MANAGED CARE ENTITY SHALL PAY A CLEAN
23 CLAIM SUBMITTED BY A PROVIDER WITHIN 45 DAYS OF A RECEIPT OF THE
24 CLAIM. THE ENTITY SHALL BE DEEMED TO HAVE RECEIVED THE CLAIM AND
25 DOCUMENTATION THREE BUSINESS DAYS AFTER BEING MAILED BY THE
26 PROVIDER TO THE APPROPRIATE DEPARTMENT WITHIN THE ENTITY.
27 CONTRACTUAL AGREEMENTS BETWEEN ENTITIES AND PROVIDERS SHALL MEET
28 OR EXCEED THE REQUIREMENTS SET FORTH IN THIS SECTION.
29 (B) FAILURE TO PAY.--IF AN ENTITY FAILS TO MAKE PAYMENT
30 UNDER SUBSECTION (A), INTEREST AT 10% PER ANNUM SHALL BE ADDED
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1 TO THE AMOUNT OF THE CLAIM, BEGINNING ON THE DAY AFTER THE
2 REQUIRED PAYMENT DATE AND ENDING ON THE DATE ON WHICH PAYMENT OF
3 THE CLAIM IS MADE. INTEREST IMPOSED FOR FAILURE TO COMPLY WITH
4 SUBSECTION (A) WHICH REMAINS UNPAID AT THE END OF ANY 30-DAY
5 PERIOD SHALL BE ADDED TO THE PRINCIPAL; AND, THEREAFTER,
6 INTEREST SHALL ACCRUE ON THE ADDED AMOUNT.
7 (C) ADMINISTRATIVE REMEDY.--THE INSURANCE COMMISSIONER SHALL
8 INVESTIGATE A WRITTEN COMPLAINT FROM A HEALTH CARE PROVIDER
9 CONCERNING A MANAGED CARE ENTITY'S COMPLIANCE WITH THIS SECTION.
10 A VIOLATION OF THIS SECTION SHALL BE CONSIDERED AN UNFAIR
11 INSURANCE PRACTICE AND BE SUBJECT TO THE PROCEDURES AND
12 PENALTIES UNDER THE ACT OF JULY 22, 1974 (P.L.589, NO.205),
13 KNOWN AS THE UNFAIR INSURANCE PRACTICES ACT.
14 SECTION 13. INVESTIGATIONS AND PENALTIES.
15 (A) INVESTIGATION.--EXCEPT AS SET FORTH IN SECTION 12, THE
16 DEPARTMENT SHALL INVESTIGATE A MANAGED CARE ENTITY'S COMPLIANCE
17 WITH THIS ACT IN RESPONSE TO A WRITTEN COMPLAINT BY A HEALTH
18 CARE PROVIDER.
19 (B) PENALTIES.--THE DEPARTMENT MAY IMPOSE AN ADMINISTRATIVE
20 PENALTY OF UP TO $10,000 FOR EACH VIOLATION OF THIS ACT. IN
21 ADDITION, THE DEPARTMENT MAY DENY, SUSPEND, REVOKE OR REFUSE TO
22 RENEW THE CERTIFICATION OF A UTILIZATION REVIEW ENTITY THAT
23 FAILS TO COMPLY WITH THE PROVISIONS OF THIS ACT. THIS SUBSECTION
24 IS SUBJECT TO 2 PA.C.S. CH. 5 SUBCH. A (RELATING TO PRACTICE AND
25 PROCEDURE OF COMMONWEALTH AGENCIES) AND CH. 7 SUBCH. A (RELATING
26 TO JUDICIAL REVIEW OF COMMONWEALTH AGENCY ACTION).
27 SECTION 14. REGULATIONS.
28 THE DEPARTMENT AND INSURANCE DEPARTMENT SHALL PROMULGATE
29 REGULATIONS NECESSARY TO IMPLEMENT THE PROVISIONS OF THIS ACT.
30 SECTION 15. EXCEPTIONS.
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1 THIS ACT SHALL NOT APPLY TO ANY OF THE FOLLOWING:
2 (1) PEER REVIEW OR UTILIZATION REVIEW PERFORMED UNDER
3 THE ACT OF JUNE 2, 1915 (P.L.736, NO.338), KNOWN AS THE
4 WORKERS' COMPENSATION ACT.
5 (2) THE ACT OF JULY 1, 1937 (P.L.2532, NO.470), KNOWN AS
6 THE WORKERS' COMPENSATION SECURITY FUND ACT.
7 (3) PEER REVIEW, UTILIZATION REVIEW OR MENTAL OR
8 PHYSICAL EXAMINATIONS PERFORMED UNDER 75 PA.C.S. CH. 17
9 (RELATING TO FINANCIAL RESPONSIBILITY).
10 (4) THE FEE-FOR-SERVICE PROGRAMS OPERATED BY THE
11 DEPARTMENT OF PUBLIC WELFARE UNDER TITLE XIX OF THE SOCIAL
12 SECURITY ACT (49 STAT. 620, 42 U.S.C. § 1396 ET SEQ.).
13 SECTION 16. APPLICABILITY.
14 (A) PREEMPTION.--NOTHING IN THIS ACT SHALL REGULATE OR
15 AUTHORIZE REGULATION WHICH WOULD BE INEFFECTIVE BY REASON OF THE
16 STATE LAW PREEMPTION PROVISIONS OF THE EMPLOYEE RETIREMENT
17 INCOME SECURITY ACT OF 1974 (PUBLIC LAW 93-406, 88 STAT. 829).
18 SECTION 17. DISCRIMINATION ON MORAL OR RELIGIOUS GROUNDS
19 PROHIBITED.
20 NO PUBLIC INSTITUTION, PUBLIC OFFICIAL OR PUBLIC AGENCY MAY
21 IMPOSE PENALTIES, TAKE DISCIPLINARY ACTION AGAINST, OR DENY OR
22 LIMIT PUBLIC FUNDS, LICENSES, AUTHORIZATIONS, OR OTHER APPROVALS
23 OR DOCUMENTS OF QUALIFICATION TO ANY PERSON, ASSOCIATION, OR
24 CORPORATION:
25 (1) ATTEMPTING TO ESTABLISH A PLAN; OR
26 (2) OPERATING, EXPANDING OR IMPROVING AN EXISTING PLAN,
27 BECAUSE THE PERSON, ASSOCIATION OR CORPORATION REFUSES TO PAY
28 FOR OR ARRANGE FOR THE PAYMENT OF ANY PARTICULAR FORM OF
29 HEALTH CARE SERVICES OR OTHER SERVICES OR SUPPLIES COVERED BY
30 OTHER PLANS WHEN SUCH REFUSAL IS BY REASON OF OBJECTION
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1 THERETO ON MORAL OR RELIGIOUS GROUNDS.
2 SECTION 18. EFFECTIVE DATE.
3 THIS ACT SHALL TAKE EFFECT IN 180 DAYS.
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