SENATE AMENDED PRIOR PRINTER'S NOS. 2965, 3231, 3450, PRINTER'S NO. 4511 4346
No. 2098 Session of 2007
INTRODUCED BY DeLUCA, BELFANTI, FRANKEL, HALUSKA, KOTIK, MOYER, SIPTROTH, WALKO, J. WHITE, WOJNAROSKI, PETRONE, YOUNGBLOOD, GIBBONS AND CALTAGIRONE, DECEMBER 6, 2007
SENATOR ARMSTRONG, APPROPRIATIONS, IN SENATE, RE-REPORTED AS AMENDED, OCTOBER 6, 2008
AN ACT 1 Establishing a system for payment or reduction in payment for <-- 2 preventable serious adverse events within Commonwealth 3 programs; informing health insurers of payment policies used 4 by Medicaid and Medicare; and providing for the powers and 5 duties of the Department of Public Welfare, the Insurance 6 Department, the Department of Health and the Department of 7 State. 8 ESTABLISHING A SYSTEM FOR PAYMENT OR REDUCTION IN PAYMENT FOR <-- 9 PREVENTABLE SERIOUS ADVERSE EVENTS WITHIN THIS COMMONWEALTH; 10 AND PROVIDING FOR THE POWERS AND DUTIES OF THE DEPARTMENT OF 11 HEALTH AND THE DEPARTMENT OF STATE. 12 The General Assembly of the Commonwealth of Pennsylvania 13 hereby enacts as follows: 14 Section 1. Short title. <-- 15 This act shall be known and may be cited as the Preventable 16 Serious Adverse Events Act. 17 Section 2. Definitions. 18 The following words and phrases when used in this act shall 19 have the meanings given to them in this section unless the 20 context clearly indicates otherwise:
1 "Centers for Medicare and Medicaid Services" or "CMS." The 2 Centers for Medicare and Medicaid Services within the United 3 States Department of Health and Human Services. 4 "Department." The Insurance Department of the Commonwealth. 5 "Facility." A health care facility as defined in section 6 802.1 of the act of July 19, 1979 (P.L.130, No.48), known as the 7 Health Care Facilities Act, or an entity licensed as a hospital 8 under the act of June 13, 1967 (P.L.31, No.21), known as the 9 Public Welfare Code. 10 "Health care provider." A health care facility or a person, 11 including a corporation, university or other educational 12 institution licensed or approved by the Commonwealth to provide 13 health care or professional medical services as a physician, a 14 certified nurse midwife, a podiatrist, a certified registered 15 nurse practitioner, a physician assistant, a chiropractor, a 16 hospital, an ambulatory surgery center, a nursing home and a 17 birth center. 18 "Health payor." An individual or entity providing a group 19 health, sickness or accident policy, subscriber contract or 20 program issued or provided by an entity, including any one of 21 the following: 22 (1) The act of June 2, 1915 (P.L.736, No.338), known as 23 the Workers' Compensation Act. 24 (2) The act of May 17, 1921 (P.L.682, No.284), known as 25 The Insurance Company Law of 1921. 26 (3) The act of December 29, 1972 (P.L.1701, No.364), 27 known as the Health Maintenance Organization Act. 28 (4) The act of May 18, 1976 (P.L.123, No.54), known as 29 the Individual Accident and Sickness Insurance Minimum 30 Standards Act. 20070H2098B4511 - 2 -
1 (5) 40 Pa.C.S. Ch. 61 (relating to hospital plan 2 corporations). 3 (6) 40 Pa.C.S. Ch. 63 (relating to professional health 4 services plan corporations). 5 "Medical assistance." The Commonwealth's medical assistance 6 program established under the act of June 13, 1967 (P.L.31, 7 No.21), known as the Public Welfare Code. 8 "Preventable serious adverse event." A clearly defined 9 condition or negative consequence of care that results in 10 unintended injury or illness that could have been anticipated 11 and prepared for, but that occurs because of an error or other 12 system failure and results in a patient's death, loss of a body 13 part, disability or loss of bodily function lasting more than 14 seven days. 15 Section 3. Payment policy for preventable serious adverse 16 events. 17 (a) General rule.--The following criteria shall be used by 18 health payors in determining when payment or partial payment to 19 a health care provider will be withheld: 20 (1) A preventable serious adverse event must occur. 21 (2) The preventable serious adverse event must be within 22 the control of the health care provider. 23 (3) The preventable serious adverse event must occur in 24 a health care facility. 25 (b) Language addressing payment policy.--Payments can only 26 be withheld by health payors for services related to a 27 preventable serious adverse event or care made necessary by the 28 preventable serious adverse event if the agreement or contract 29 between the health payor and health care provider contains 30 language addressing payment policy for preventable serious 20070H2098B4511 - 3 -
1 adverse events. 2 (c) Restriction.--Health care providers shall not seek 3 payment directly from patients or the responsible party of the 4 patient for preventable serious adverse events. 5 Section 4. Duties of Department of Public Welfare. 6 (a) Department responsibilities.--The Department of Public 7 Welfare is responsible for the following: 8 (1) Determining payment policy under medical assistance 9 with respect to reduced reimbursements to health care 10 providers for preventable serious adverse events. This 11 payment policy includes the criteria and clearly stated 12 payment policies affecting health care providers. 13 (2) Publishing the payment policy in the Pennsylvania 14 Bulletin following a 30-day public comment period. 15 (b) Ongoing reviews.--Nothing in this section shall affect 16 ongoing reviews of medical assistance services conducted by the 17 Department of Public Welfare. 18 (c) Hospital payment policy.--Nothing in this section shall 19 require the department to alter, amend or reissue any payment 20 policy for inpatient hospitals relating to preventable serious 21 adverse events that was promulgated prior to the enactment of 22 this act. 23 Section 5. Duties of Insurance Department. 24 (a) Notice of preventable serious adverse events.--The 25 department shall annually notify health payors of the list of 26 preventable serious adverse events that CMS is using under the 27 Medicare program and for which health payors may withhold 28 reimbursement under section 3. 29 (b) Notice of CMS rule.--The department shall transmit 30 notice of the effective date of the CMS Hospital-Acquired 20070H2098B4511 - 4 -
1 Conditions, Including Infections, Final Rule, to the Legislative 2 Reference Bureau for publication in the Pennsylvania Bulletin. 3 Section 6. Duties of Department of Health. 4 In accordance with the act of July 19, 1979 (P.L.130, No.48), 5 known as the Health Care Facilities Act, the Department of 6 Health shall be responsible for investigating patient complaints 7 regarding a health care facility that is seeking payment 8 directly from the patient for a preventable serious adverse 9 event. 10 Section 7. Duties of Department of State. 11 The Department of State shall be responsible for 12 investigating complaints regarding a health care provider that 13 is not a health care facility that is seeking or causing to be 14 sought payment directly from the patient or responsible party of 15 the patient for a preventable serious adverse event. 16 Section 19. Applicability. 17 This act shall apply to preventable serious adverse events 18 that occur after the later of the following: 19 (1) Publication of the notice under section 5(b). 20 (2) October 1, 2008. 21 Section 20. Effective date. 22 This act shall take effect immediately. 23 SECTION 1. SHORT TITLE. <-- 24 THIS ACT SHALL BE KNOWN AND MAY BE CITED AS THE PREVENTABLE 25 SERIOUS ADVERSE EVENTS ACT. 26 SECTION 2. DEFINITIONS. 27 THE FOLLOWING WORDS AND PHRASES WHEN USED IN THIS ACT SHALL 28 HAVE THE MEANINGS GIVEN TO THEM IN THIS SECTION UNLESS THE 29 CONTEXT CLEARLY INDICATES OTHERWISE: 30 "HEALTH CARE FACILITY." A HEALTH CARE FACILITY AS DEFINED 20070H2098B4511 - 5 -
1 UNDER SECTION 802.1 OF THE ACT OF JULY 19, 1979 (P.L.130, 2 NO.48), KNOWN AS THE HEALTH CARE FACILITIES ACT, OR AN ENTITY 3 LICENSED AS A HOSPITAL UNDER THE ACT OF JUNE 13, 1967 (P.L.31, 4 NO.21), KNOWN AS THE PUBLIC WELFARE CODE. 5 "HEALTH CARE PROVIDER." A HEALTH CARE FACILITY OR A PERSON, 6 INCLUDING A CORPORATION, UNIVERSITY OR OTHER EDUCATIONAL 7 INSTITUTION, LICENSED OR APPROVED BY THE COMMONWEALTH TO PROVIDE 8 HEALTH CARE OR PROFESSIONAL MEDICAL SERVICES. THE TERM SHALL 9 INCLUDE, BUT NOT BE LIMITED TO, A PHYSICIAN, A CERTIFIED NURSE 10 MIDWIFE, A PODIATRIST, A CERTIFIED REGISTERED NURSE 11 PRACTITIONER, A PHYSICIAN ASSISTANT, A CHIROPRACTOR, A HOSPITAL, 12 AN AMBULATORY SURGERY CENTER, A NURSING HOME OR A BIRTH CENTER. 13 "HEALTH PAYOR." AN INDIVIDUAL OR ENTITY PAYING FOR HEALTH 14 SERVICES FOR HIMSELF OR ITSELF OR ON BEHALF OF ANOTHER. <-- 15 "MEDICAL ASSISTANCE." THE COMMONWEALTH'S MEDICAL ASSISTANCE 16 PROGRAM ESTABLISHED UNDER THE ACT OF JUNE 13, 1967 (P.L.31, 17 NO.21), KNOWN AS THE PUBLIC WELFARE CODE. 18 "NATIONAL QUALITY FORUM." A NOT-FOR-PROFIT MEMBERSHIP 19 ORGANIZATION CREATED TO DEVELOP AND IMPLEMENT A NATIONAL 20 STRATEGY FOR HEALTH CARE QUALITY MEASUREMENT AND REPORTING. 21 "PREVENTABLE SERIOUS ADVERSE EVENT." AN EVENT THAT OCCURS IN 22 A HEALTH CARE FACILITY THAT IS WITHIN THE HEALTH CARE PROVIDER'S 23 CONTROL TO AVOID, BUT THAT OCCURS BECAUSE OF AN ERROR OR OTHER 24 SYSTEM FAILURE AND RESULTS IN A PATIENT'S DEATH, LOSS OF BODY 25 PART, DISFIGUREMENT, DISABILITY OR LOSS OF BODILY FUNCTION 26 LASTING MORE THAN SEVEN DAYS OR STILL PRESENT AT THE TIME OF 27 DISCHARGE FROM A HEALTH CARE FACILITY. SUCH EVENTS SHALL BE 28 WITHIN THE LIST OF REPORTABLE SERIOUS EVENTS ADOPTED BY THE 29 NATIONAL QUALITY FORUM. 30 SECTION 3. PAYMENT POLICY FOR PREVENTABLE SERIOUS ADVERSE 20070H2098B4511 - 6 -
1 EVENTS. 2 (A) GENERAL RULE.--HEALTH CARE PROVIDERS MAY NOT KNOWINGLY 3 SEEK PAYMENT FROM HEALTH PAYORS, PATIENTS OR THE RESPONSIBLE <-- 4 PARTY OF THE PATIENT OR PATIENTS FOR A PREVENTABLE SERIOUS <-- 5 ADVERSE EVENT OR SERVICES REQUIRED TO CORRECT OR TREAT THE 6 PROBLEM CREATED BY SUCH AN EVENT WHEN SUCH AN EVENT OCCURRED 7 UNDER THEIR CONTROL. 8 (B) REFUNDS.--A HEALTH CARE PROVIDER WHO DISCOVERS THAT 9 PAYMENT HAS UNKNOWINGLY BEEN SOUGHT FOR A PREVENTABLE SERIOUS 10 ADVERSE EVENT OR SERVICES REQUIRED TO CORRECT OR TREAT THE 11 PROBLEM CREATED BY SUCH AN EVENT SHALL IMMEDIATELY NOTIFY THE 12 HEALTH PAYOR, PATIENT OR THE RESPONSIBLE PARTY OF THE PATIENT OR <-- 13 PATIENT AND SHALL REFUND ANY PAYMENT RECEIVED WITHIN 30 DAYS OF 14 DISCOVERY OR RECEIPT OF PAYMENT, WHICHEVER IS LATER. 15 (C) NOTIFICATION.--A HEALTH CARE PAYOR WHO DISCOVERS THAT 16 PAYMENT HAS BEEN SOUGHT FOR A PREVENTABLE SERIOUS ADVERSE EVENT 17 OR SERVICES REQUIRED TO CORRECT OR TREAT A PROBLEM CREATED BY 18 SUCH AN EVENT SHALL NOTIFY THE HEALTH CARE PROVIDER THAT PAYMENT 19 MAY NOT BE SOUGHT FOR SUCH AN EVENT OR SERVICES AND THAT PAYMENT 20 SHALL NOT BE MADE FOR SUCH EVENTS OR SERVICES. 21 (D) LIABILITY.--ANY INFORMATION PROVIDED TO ANY HEALTH CARE 22 PAYOR OR HEALTH CARE PROVIDER, IN COMPLIANCE WITH SUBSECTIONS 23 (B) AND (C), SHALL NOT BE DISCOVERABLE OR ADMISSIBLE IN ANY 24 CIVIL OR ADMINISTRATIVE ACTION RELATED TO THE ACT OF MARCH 20, 25 2002 (P.L.154, NO.13), KNOWN AS THE MEDICAL CARE AVAILABILITY 26 AND REDUCTION OF ERROR (MCARE) ACT. 27 SECTION 4. DUTIES OF DEPARTMENT OF HEALTH. 28 (A) PUBLISHING OF UPDATES.--THE DEPARTMENT SHALL PUBLISH IN 29 THE PENNSYLVANIA BULLETIN ANY UPDATES TO THE LIST OF REPORTABLE 30 SERIOUS ADVERSE EVENTS ADOPTED BY THE NATIONAL QUALITY FORUM 20070H2098B4511 - 7 -
1 WITHIN 30 DAYS OF THE UPDATE ISSUED BY THE NATIONAL QUALITY 2 FORUM. 3 (B) HEALTH DEPARTMENT RESPONSIBILITY.--IN ACCORDANCE WITH 4 THE ACT OF JULY 19, 1979 (P.L.130, NO.48), KNOWN AS THE HEALTH 5 CARE FACILITIES ACT, THE DEPARTMENT OF HEALTH SHALL BE 6 RESPONSIBLE FOR INVESTIGATING PATIENT COMPLAINTS REGARDING A 7 HEALTH CARE FACILITY THAT IS SEEKING PAYMENT DIRECTLY FROM THE 8 PATIENT OR HEALTH CARE PAYOR FOR A PREVENTABLE SERIOUS ADVERSE 9 EVENT. 10 SECTION 5. DUTIES OF DEPARTMENT OF STATE. 11 THE DEPARTMENT OF STATE SHALL BE RESPONSIBLE FOR 12 INVESTIGATING PATIENT COMPLAINTS REGARDING A HEALTH CARE 13 PROVIDER THAT IS NOT A HEALTH CARE FACILITY THAT IS SEEKING OR 14 CAUSING TO BE SOUGHT PAYMENT DIRECTLY FROM THE PATIENT OR HEALTH 15 CARE PAYOR FOR A PREVENTABLE SERIOUS ADVERSE EVENT. 16 SECTION 6. APPLICABILITY. 17 (A) HOSPITAL MEDICAL ASSISTANCE PAYMENT POLICY.--NOTHING IN 18 THIS ACT SHALL REQUIRE THE DEPARTMENT OF PUBLIC WELFARE TO 19 ALTER, AMEND OR REISSUE ANY PAYMENT POLICY FOR INPATIENT 20 HOSPITALS RELATING TO PREVENTABLE SERIOUS ADVERSE EVENTS THAT 21 WAS PROMULGATED PRIOR TO THE ENACTMENT OF THIS ACT. ANY 22 MODIFICATIONS TO THE DEPARTMENT OF PUBLIC WELFARE PAYMENT POLICY 23 PROMULGATED ON OR AFTER THE DATE OF ENACTMENT OF THIS ACT FOR A 24 HEALTH CARE PROVIDER FOR A PREVENTABLE SERIOUS ADVERSE EVENT 25 SHALL REQUIRE A 30-DAY PUBLIC COMMENT PERIOD. 26 (B) CONTRACTS.--NOTHING IN THIS ACT SHALL PROHIBIT A HEALTH 27 CARE PROVIDER AND PAYOR FROM ESTABLISHING BY CONTRACT ANY 28 POLICIES AND PROCEDURES ASSOCIATED WITH SERIOUS PREVENTABLE 29 ADVERSE EVENTS NECESSARY TO IMPLEMENT THE PROVISIONS OF THIS 30 ACT. 20070H2098B4511 - 8 -
1 (C) REPORTING.-- 2 (1) HEALTH CARE PROVIDERS SHALL INCLUDE ALL APPLICABLE 3 MEDICAL CODES IN MAKING REPORTS IN COMPLIANCE WITH THE ACT OF 4 JULY 8, 1986 (P.L.408, NO.89), KNOWN AS THE HEALTH CARE COST 5 CONTAINMENT ACT. 6 (2) A PREVENTABLE SERIOUS ADVERSE EVENT SHALL BE 7 REPORTED PURSUANT TO THE REQUIREMENTS OF THE ACT OF MARCH 20, 8 2002 (P.L.154, NO.13), KNOWN AS THE MEDICAL CARE AVAILABILITY 9 AND REDUCTION OF ERROR (MCARE) ACT. 10 (D) MEDICARE PAYMENT.--NOTHING IN THIS ACT SHALL BE <-- 11 CONSTRUED TO SUPERSEDE MEDICARE PAYMENT POLICIES WHERE THE 12 SERVICES PROVIDED TO THE PATIENT ARE PAID FOR BY MEDICARE. IF 13 MEDICARE DENIES PAYMENT BASED ON A DETERMINATION THAT A 14 PREVENTABLE SERIOUS ADVERSE EVENT HAS OCCURRED, NOTHING IN THIS 15 ACT SHALL BE CONSTRUED TO REQUIRE MEDICAL ASSISTANCE OR A HEALTH 16 PAYOR TO PAY A CLAIM FOR THE EVENT OR SERVICES. 17 SECTION 7. EFFECTIVE DATE. 18 THIS ACT SHALL TAKE EFFECT IN 180 DAYS. K20L40GRH/20070H2098B4511 - 9 -