THE GENERAL ASSEMBLY OF PENNSYLVANIA

HOUSE BILL

INTRODUCED BY FABRIZIO, DeLUCA, SONNEY, COHEN, V. BROWN, CALTAGIRONE, D. COSTA, GEORGE, HALUSKA, HARKINS, HORNAMAN, JOSEPHS, KIRKLAND, KORTZ, KOTIK, KULA, LONGIETTI, MATZIE, MUNDY, MURT, M. O'BRIEN, READSHAW, SANTARSIERO, SANTONI, K. SMITH, STABACK AND WAGNER, APRIL 5, 2011

REFERRED TO COMMITTEE ON INSURANCE, APRIL 5, 2011  

AN ACT

Providing for health carrier grievance procedures; and imposing

penalties.

TABLE OF CONTENTS

Section 1.  Short title.

Section 2.  Purpose and intent.

Section 3.  Definitions.

Section 4.  Applicability and scope.

Section 5.  Grievance reporting and recordkeeping requirements.

Section 6.  Grievance review procedures.

Section 7.  First level reviews of grievances involving adverse

determination.

Section 8.  Standard reviews of grievances not involving adverse

determination.

Section 9.  Voluntary level of reviews of grievances.

Section 10.  Expedited reviews of grievances involving adverse

determination.

Section 11.  Regulations.

Section 12.  Penalties.

Section 13.  Administrative review.

Section 14.  Repeals.

Section 15.  Effective date.

The General Assembly of the Commonwealth of Pennsylvania

hereby enacts as follows:

Section 1.  Short title.

This act shall be known and may be cited as the Health

Carrier Grievance Procedure Act.

Section 2.  Purpose and intent.

The purpose of this act is to provide standards for the

establishment and maintenance of procedures by health carriers

to assure that covered persons have the opportunity for the

appropriate resolution of grievances, as defined in this act.

Section 3.  Definitions.

The following words and phrases when used in this act shall

have the meanings given to them in this section unless the

context clearly indicates otherwise:

"Adverse determination."  The term means:

(1)  a determination by a health carrier or its designee

utilization review organization that, based upon the

information provided, a request for a benefit under the

health carrier's health benefit plan upon application of any

utilization review technique does not meet the health

carrier's requirements for medical necessity,

appropriateness, health care setting, level of care or

effectiveness or is determined to be experimental or

investigational and the requested benefit is therefore

denied, reduced or terminated or payment is not provided or

made, in whole or in part, for the benefit;

(2)  the denial, reduction, termination or failure to

provide or make payment, in whole or in part, for a benefit

based on a determination by a health carrier or its designee

utilization review organization of a covered person's

eligibility to participate in the health carrier's health

benefit plan; or

(3)  any prospective review or retrospective review

determination that denies, reduces or terminates or fails to

provide or make payment, in whole or in part, for a benefit.

The term shall include a rescission of coverage determination.

"Ambulatory review."  Utilization review of health care

services performed or provided in an outpatient setting.

"Authorized representative."  The term means:

(1)  a person to whom a covered person has given express

written consent to represent the covered person for purposes

of this act;

(2)  a person authorized by law to provide substituted

consent for a covered person;

(3)  a family member of the covered person or the covered

person's treating health care professional when the covered

person is unable to provide consent;

(4)  a health care professional when the covered person's

health benefit plan requires that a request for a benefit

under the plan be initiated by the health care professional;

or

(5)  in the case of an urgent care request, a health care

professional with knowledge of the covered person's medical

condition.

"Case management."  A coordinated set of activities conducted

for individual patient management of serious, complicated,

protracted or other health conditions.

"Certification."  A determination by a health carrier or its

designee utilization review organization that a request for a

benefit under the health carrier's health benefit plan has been

reviewed and, based on the information provided, satisfies the

health carrier's requirements for medical necessity,

appropriateness, health care setting, level of care and

effectiveness.

"Clinical peer."  A physician or other health care

professional who holds a nonrestricted license in a state of the

United States and in the same or similar specialty as typically

manages the medical condition, procedure or treatment under

review.

"Clinical review criteria."  The written screening

procedures, decision abstracts, clinical protocols and practice

guidelines used by the health carrier to determine the medical

necessity and appropriateness of health care services.

"Closed plan."  A managed care plan that requires covered

persons to use participating providers under the terms of the

managed care plan.

"Commissioner."  The Insurance Commissioner of the

Commonwealth.

"Concurrent review."  A utilization review conducted during a

patient's stay or course of treatment in a facility, the office

of a health care professional or other inpatient or outpatient

health care setting.

"Covered benefits" or "benefits."  Those health care services

to which a covered person is entitled under the terms of a

health benefit plan.

"Covered person."  A policyholder, subscriber, enrollee or

other individual participating in a health benefit plan.

"Department."  The Insurance Department of the Commonwealth.

"Discharge planning."  The formal process for determining,

prior to discharge from a facility, the coordination and

management of the care that a patient receives following

discharge from a facility.

"Emergency medical condition."  The sudden and, at the time,

unexpected onset of a health condition or a medical condition

manifesting itself by acute symptoms of sufficient severity,

including severe pain, such that a prudent layperson, who

possesses an average knowledge of health and medicine, could

reasonably expect that requires the absence of immediate medical

attention, where failure to provide medical attention would

result in serious impairment to bodily functions, serious

dysfunction of a bodily organ or part, or would place the

person's health or, with respect to a pregnant woman, the health

of the woman or her unborn child, in serious jeopardy.

"Emergency services."  With respect to an emergency medical

condition, health care items and services furnished or required

to evaluate and treat an emergency medical condition:

(1)  A medical screening examination that is within the

capability of the emergency department of a hospital,

including ancillary services routinely available to the

emergency department to evaluate such emergency medical

condition.

(2)  Such further medical examination and treatment, to

the extent they are within the capability of the staff and

facilities available at a hospital, to stabilize a patient.

"Facility."  An institution providing health care services or

a health care setting, including, but not limited to, hospitals

and other licensed inpatient centers, ambulatory surgical or

treatment centers, skilled nursing centers, residential

treatment centers, diagnostic, laboratory and imaging centers

and rehabilitation and other therapeutic health settings.

"Final adverse determination."  An adverse determination that

has been upheld by the health carrier at the completion of the

internal appeals process applicable under section 7 or 10 or an

adverse determination that with respect to which the internal

appeals process has been deemed exhausted in accordance with

section 6(a)(2).

"Grievance."  A written complaint or oral complaint if the

complaint involves an urgent care request submitted by or on

behalf of a covered person regarding:

(1)  availability, delivery or quality of health care

services, including a complaint regarding an adverse

determination made pursuant to utilization review;

(2)  claims payment, handling or reimbursement for health

care services; or

(3)  matters pertaining to the contractual relationship

between a covered person and a health carrier.

"Health benefit plan."

(1)  A policy, contract, certificate or agreement offered

or issued by a health carrier to provide, deliver, arrange

for, pay for or reimburse any of the costs of health care

services. The term includes short-term and catastrophic

health insurance policies and a policy that pays on a cost-

incurred basis, except as otherwise specifically exempted in

this definition. The term does not include:

(i)  Coverage only for accident or disability income

insurance or any combination thereof.

(ii)  Coverage issued as a supplement to liability

insurance.

(iii)  Liability insurance, including general

liability insurance and automobile liability insurance.

(iv)  Workers' compensation or similar insurance.

(v)  Automobile medical payment insurance.

(vi)  Credit-only insurance.

(vii)  Coverage for onsite medical clinics.

(viii)  Other similar insurance coverage, specified

in Federal regulations issued pursuant to the Health

Insurance Portability and Accountability Act of 1996

(Public Law 104-191, 110 Stat. 1936), under which

benefits for medical care are secondary or incidental to

other insurance benefits.

(2)  The term does not include the following benefits if

they are provided under a separate policy, certificate or

contract of insurance or are otherwise not an integral part

of the plan:

(i)  Limited scope dental or vision benefits.

(ii)  Benefits for long-term care, nursing home care,

home health care, community-based care or any combination

thereof.

(iii)  Other similar, limited benefits specified in

Federal regulations issued pursuant to the Health

Insurance Portability and Accountability Act of 1996.

(3)  The term does not include the following benefits if

the benefits are provided under a separate policy,

certificate or contract of insurance, there is no

coordination between the provision of the benefits and any

exclusion of benefits under any group health plan maintained

by the same plan sponsor, and the benefits are paid with

respect to an event without regard to whether benefits are

provided with respect to such an event under any group health

plan maintained by the same plan sponsor:

(i)  coverage only for a specified disease or

illness; or

(ii)  hospital indemnity or other fixed indemnity

insurance.

(4)  The term does not include the following if offered

as a separate policy, certificate or contract of insurance:

(i)  Medicare supplemental health insurance as

defined under section 1882(g)(1) of the Social Security

Act (49 Stat. 620, 42 U.S.C. § 301 et seq.);

(ii)  coverage supplemental to the coverage provided

under the Civilian Health and Medical Program of the

Uniformed Services (CHAMPUS); or

(iii)  similar supplemental coverage provided to

coverage under a group health plan.

"Health care professional."  A physician or other health care

practitioner licensed, accredited or certified to perform

specified health care services consistent with State law.

"Health care provider" or "provider."  A health care

professional or a facility.

"Health care services."  Services for the diagnosis,

prevention, treatment, cure or relief of a health condition,

illness, injury or disease.

"Health carrier."  A company or health insurance entity

licensed in this Commonwealth to offer or issue any individual

or group health, sickness or accident policy or subscriber

contract or certificate or plan that provides medical or health

care coverage by a health care facility or licensed health care

provider that is governed under this act or any of the

following:

(1)  The act of December 29, 1972 (P.L.1701, No.364),

known as the Health Maintenance Organization Act.

(2)  The act of May 18, 1976 (P.L.123, No.54), known as

the Individual Accident and Sickness Insurance Minimum

Standards Act.

(3)  40 Pa.C.S. Ch. 61 (relating to hospital plan

corporations) or 63 (relating to professional health services

plan corporations).

(4)  Article XXIV of the act of May 17, 1921 (P.L.682,

No.284), known as The Insurance Company Law of 1921.

"Health indemnity plan."  A health benefit plan that is not a

managed care plan.

"Managed care plan."  A health benefit plan that requires a

covered person to use, or creates incentives, including

financial incentives, for a covered person to use health care

providers managed, owned, under contract with or employed by the

health carrier. The term includes:

(1)  A closed plan, as defined in this section.

(2)  An open plan, as defined in this section.

"Network."  The group of participating providers providing

services to a managed care plan.

"Open plan."  A managed care plan other than a closed plan

that provides incentives, including financial incentives, for

covered persons to use participating providers under the terms

of the managed care plan.

"Participating provider."  A provider who, under a contract

with the health carrier or with its contractor or subcontractor,

has agreed to provide health care services to covered persons

with an expectation of receiving payment, other than

coinsurance, copayments or deductibles, directly or indirectly

from the health carrier.

"Person."  An individual, a corporation, a partnership, an

association, a joint venture, a joint stock company, a trust, an

unincorporated organization, any similar entity or any

combination of the foregoing.

"Prospective review."  The utilization review conducted prior

to an admission or the provision of a health care service or a

course of treatment in accordance with a health carrier's

requirement that the health care service or course of treatment,

in whole or in part, be approved prior to its provision.

"Rescission."  A cancellation or discontinuance of coverage

under a health benefit plan that has a retroactive effect. The

term does not include a cancellation or discontinuance of

coverage under a health benefit plan if:

(1)  the cancellation or discontinuance of coverage has

only a prospective effect; or

(2)  the cancellation or discontinuance of coverage is

effective retroactively to the extent it is attributable to a

failure to timely pay required premiums or contributions

toward the cost of coverage.

"Retrospective review."  Any review of a request for a

benefit that is not a prospective review request. The term does

not include the review of a claim that is limited to veracity of

documentation or accuracy of coding.

"Second opinion."  An opportunity or requirement to obtain a

clinical evaluation by a provider other than the one originally

making a recommendation for a proposed health care service to

assess the medical necessity and appropriateness of the initial

proposed health care service.

"Stabilized."  With respect to an emergency medical

condition, that no material deterioration of the condition is

likely, within reasonable medical probability, to result from or

occur before an individual can be transferred, during the

transfer of the individual from a facility or, with respect to a

pregnant woman, the woman delivered, including the placenta.

"Urgent care request."

(1)  A request for a health care service or course of

treatment with respect to which the time periods for making

nonurgent care request determination:

(i)  could seriously jeopardize the life or health of

the covered person or the ability of the covered person

to regain maximum function; or

(ii)  in the opinion of a physician with knowledge of

the covered person's medical condition, would subject the

covered person to severe pain that cannot be adequately

managed without the health care service or treatment that

is the subject of the request.

(2)  (i)  Except as provided in subparagraph (ii), in

determining whether a request is to be treated as an

urgent care request, an individual acting on behalf of

the health carrier shall apply the judgment of a prudent

layperson who possesses an average knowledge of health

and medicine.

(ii)  Any request that a physician with knowledge of

the covered person's medical condition determines is an

urgent care request within the meaning of paragraph (1)

shall be treated as an urgent care request.

"Utilization review."  A set of formal techniques designed to

monitor the use of or evaluate the medical necessity,

appropriateness, efficacy or efficiency of health care services,

procedures, providers or facilities. Techniques may include

ambulatory review, prospective review, second opinion,

certification, concurrent review, case management, discharge

planning or retrospective review.

"Utilization review organization."  An entity that conducts a

utilization review other than a health carrier performing a

utilization review for its own health benefit plans.

Section 4.  Applicability and scope.

Except as otherwise specified, this act shall apply to all

health carriers offering a health benefit plan.

Section 5.  Grievance reporting and recordkeeping requirements.

(a)  Records.--

(1)  A health carrier shall maintain written records to

document all grievances received, including the notices and

claims associated with the grievances, during a calendar year

in the register.

(2)  Notwithstanding the provisions under subsection (f),

a health carrier shall maintain the records required

under paragraph (1) for at least six years related to the

notices provided under sections 7(h) and 10(h).

(3)  The health carrier shall make the records available

for examination by covered persons, the department and the

appropriate Federal oversight agency upon request.

(b)  Review request.--A request for a first level review of a

grievance involving an adverse determination shall be processed

in compliance with section 7 but is not required to be included

in the register.

(c)  Voluntary review.--A request for an additional voluntary

review of a grievance involving an adverse determination that

may be conducted pursuant to section 9 shall be included in the

register.

(d)  Register.--For each grievance the register shall

contain, at a minimum, the following information:

(1)  A general description of the reason for the

grievance.

(2)  The date received.

(3)  The date of each review or, if applicable, review

meeting.

(4)  Resolution at each level of the grievance, if

applicable.

(5)  The date of resolution at each level, if applicable.

(6)  The name of the covered person for whom the

grievance was filed.

(e)  Maintenance.--The register shall be maintained in a

manner that is reasonably clear and accessible to the

department.

(f)  Report.--

(1)  Subject to the provisions of subsection (a), a

health carrier shall retain the register compiled for a

calendar year for the longer of three years or until the

commissioner has adopted a final report of an examination

that contains a review of the register for that calendar

year.

(2)  (i)  A health carrier shall submit to the

commissioner, at least annually, a report in the format

specified by the commissioner.

(ii)  The report shall include for each type of

health benefit plan offered by the health carrier:

(A)  The certificate of compliance required by

section 6.

(B)  The number of covered lives.

(C)  The total number of grievances.

(D)  The number of grievances for which a covered

person requested an additional voluntary grievance

review pursuant to section 9.

(E)  The number of grievances resolved at each

level, if applicable, and their resolution.

(F)  The number of grievances appealed to the

commissioner of which the health carrier has been

informed.

(G)  The number of grievances referred to

alternative dispute resolution procedures or

resulting in litigation.

(H)  A synopsis of actions being taken to correct

problems identified.

Section 6.  Grievance review procedures.

(a)  General rule.--

(1)  Except as specified in section 10, a health carrier

shall use written procedures for receiving and resolving

grievances from covered persons, as provided in sections 7, 8

and 9.

(2)  Whenever a health carrier fails to strictly adhere

to the requirements of section 7 or 10, with respect to

receiving and resolving grievances involving an adverse

determination, the covered person shall be deemed to have

exhausted the provisions of this act and may take action

under subsection (b) regardless of whether the health

carrier asserts that it substantially complied with the

requirements of section 7 or 10, as applicable, or that

any error it committed was de minimus.

(b)  External review and remedies.--

(1)  A covered person may file a request for external

review.

(2)  In addition to paragraph (1), a covered person is

entitled to pursue any available remedies under Federal or

State law on the basis that the health carrier failed to

provide a reasonable internal claims and appeals process that

would yield a decision on the merits of the claim.

(c)  Procedures.--

(1)  A health carrier shall file a copy of the procedures

required under subsection (a), including all forms used to

process requests made pursuant to sections 7, 8 and 9, with

the department. Any subsequent material modifications to the

documents also shall be filed.

(2)  The department may disapprove a filing received in

accordance with paragraph (1) that fails to comply with this

act or applicable regulations.

(d)  Certificate of compliance.--In addition to subsection

(b), a health carrier shall file annually with the department,

as part of its annual report required by section 5, a

certificate of compliance stating that the health carrier has

established and maintains, for each of its health benefit plans,

grievance procedures that fully comply with the provisions of

this act.

(e)  Description of procedures.--A description of the

grievance procedures required under this section shall be set

forth in or attached to the policy, certificate, membership

booklet, outline of coverage or other evidence of coverage

provided to covered persons.

Section 7.  First level reviews of grievances involving adverse

determination.

(a)  General rule.--Within 180 days after the date of receipt

of a notice of an adverse determination, a covered person or the

covered person's authorized representative may file a grievance

with the health carrier requesting a first level review of the

adverse determination.

(b)  Coordinator of review.--

(1)  The health carrier shall provide the covered person

with the name, address and telephone number of a person or

organizational unit designated to coordinate the first level

review on behalf of the health carrier.

(2)  (i)  In providing for a first level review under

this section, the health carrier shall ensure that the

review is conducted in a manner to ensure the

independence and impartiality of the individuals involved

in making the first level review decision.

(ii)  In ensuring the independence and impartially of

individuals involved in making the first level review

decision, the health carrier shall not make decisions

related to such individuals regarding hiring,

compensation, termination, promotion or other similar

matters based upon the likelihood that the individual

will support the denial of benefits.

(c)  Utilization review.--

(1)  (i)  In the case of an adverse determination

involving utilization review, the health carrier shall

designate an appropriate clinical peer or peers of the

same or similar specialty as would typically manage the

case being reviewed to review the adverse determination.

The clinical peer shall not have been involved in the

initial adverse determination.

(ii)  In designating an appropriate clinical peer or

peers pursuant to subparagraph (i), the health carrier

shall ensure that, if more than one clinical peer is

involved in the review, a majority of the individuals

reviewing the adverse determination are health care

professionals who have appropriate expertise.

(2)  In conducting a review under this section, the

reviewer or reviewers shall take into consideration all

comments, documents, records and other information regarding

the request for services submitted by the covered person or

the covered person's authorized representative, without

regard to whether the information was submitted or considered

in making the initial adverse determination.

(d)  Covered person's rights.--

(1)  A covered person does not have the right to attend,

or to have a representative in attendance, at the first level

review, but the covered person or, if applicable, the covered

person's authorized representative is entitled to:

(i)  Submit written comments, documents, records and

other material relating to the request for benefits for

the reviewer or reviewers to consider when conducting the

review.

(ii)  Receive from the health carrier, upon request

and free of charge, reasonable access to and copies of

all documents, records and other information relevant to

the covered person's request for benefits.

(2)  For purposes of paragraph (1)(ii), a document,

record or other information shall be considered "relevant" to

a covered person's request for benefits if the document,

record or other information:

(i)  Was relied upon in making the benefit

determination.

(ii)  Was submitted, considered or generated in the

course of making the adverse determination, without

regard to whether the document, record or other

information was relied upon in making the benefit

determination.

(iii)  Demonstrates that, in making the benefit

determination, the health carrier or its designated

representatives consistently applied required

administrative procedures and safeguards with respect to

the covered person as other similarly situated covered

persons.

(iv)  Constitutes a statement of policy or guidance

with respect to the health benefit plan concerning the

denied health care service or treatment for the covered

person's diagnosis, without regard to whether the advice

or statement was relied upon in making the benefit

determination.

(3)  The health carrier shall make the provisions of

paragraph (1) known to the covered person or, if applicable,

the covered person's authorized representative within three

working days after the date of receipt of the grievance.

(f)  Decision.--

(1)  A health carrier shall notify and issue a decision

in writing or electronically to the covered person or, if

applicable, the covered person's authorized representative

within the time frames provided in paragraph (2) or (3).

(2)  With respect to a grievance requesting a first level

review of an adverse determination involving a prospective

review request, the health carrier shall notify and issue a

decision within a reasonable period of time that is

appropriate given the covered person's medical condition, but

no later than 30 days after the date of the health carrier's

receipt of the grievance requesting the first level review

made pursuant to subsection (a).

(3)  With respect to a grievance requesting a first level

review of an adverse determination involving a retrospective

review request, the health carrier shall notify and issue a

decision within a reasonable period of time, but no later

than 60 days after the date of the health carrier's receipt

of the grievance requesting the first level review made

pursuant to subsection (a).

(g)  Additional evidence.--

(1)  Prior to issuing a decision in accordance with the

time frames provided in subsection (f), the health carrier

shall provide free of charge to covered person, or the

covered person's authorized representative, any new or

additional evidence, relied upon or generated by the health

carrier, or at the direction of the health carrier, in

connection with the grievance sufficiently in advance of the

date the decision is required to be provided to permit the

covered person, or the covered person's authorized

representative, a reasonable opportunity to respond prior to

that date.

(2)  Before the health carrier issues or provides notice

of a final adverse determination in accordance with the time

frames provided in subsection (f) that is based on new or

additional rationale, the health carrier shall provide the

new or additional rationale to the covered person, or the

covered person's authorized representative, free of charge as

soon as possible and sufficiently in advance of the date the

notice of final adverse determination is to be provided to

permit the covered person, or the covered person's authorized

representative, a reasonable opportunity to respond prior to

that date.

(h)  Manner of decision.--The decision issued pursuant to

subsection (f) shall set forth in a manner calculated to be

understood by the covered person or, if applicable, the covered

person's authorized representative:

(1)  The titles and qualifying credentials of the person

or persons participating in the first level review process.

(2)  Information sufficient to identify the claim

involved with respect to the grievance, including the date of

service, the health care provider, if applicable, the claim

amount, the diagnosis code and its corresponding meaning and

the treatment code and its corresponding meaning.

(3)  A statement of the reviewers' understanding of the

covered person's grievance.

(4)  The reviewers' decision in clear terms and the

contract basis or medical rationale in sufficient detail for

the covered person to respond further to the health carrier's

position.

(5)  A reference to the evidence or documentation used as

the basis for the decision.

(6)  For a first level review decision issued pursuant to

subsection (f) involving an adverse determination that

upholds the grievance:

(i)  The specific reason or reasons for the final

adverse determination, including the denial code and its

corresponding meaning, as well as a description of the

health carrier's standard, if any, that was used in

reaching the denial.

(ii)  The reference to the specific plan provisions

on which the determination is based.

(iii)  A statement that the covered person is

entitled to receive, upon request and free of charge,

reasonable access to, and copies of, all documents,

records and other information relevant, as the term

"relevant" is used in subsection (d)(2), to the covered

person's benefit request.

(iv)  If the health carrier relied upon an internal

rule, guideline, protocol or other similar criterion to

make the final adverse determination, either the specific

rule, guideline, protocol or other similar criterion or a

statement that a specific rule, guideline, protocol or

other similar criterion was relied upon to make the final

adverse determination and that a copy of the rule,

guideline, protocol or other similar criterion will be

provided free of charge to the covered person upon

request.

(v)  If the final adverse determination is based on a

medical necessity or experimental or investigational

treatment or similar exclusion or limit, either an

explanation of the scientific or clinical judgment for

making the determination, applying the terms of the

health benefit plan to the covered person's medical

circumstances or a statement that an explanation will be

provided to the covered person free of charge upon

request.

(vi)  If applicable, instructions for requesting:

(A)  A copy of the rule, guideline, protocol or

other similar criterion relied upon in making the

final adverse determination, as provided in paragraph

(4).

(B)  The written statement of the scientific or

clinical rationale for the determination, as provided

in subsection (f)(1).

(vii)  If applicable, a statement indicating:

(A)  A description of the process to obtain an

additional voluntary review of the first level review

decision involving an adverse determination, if the

covered person wishes to request a voluntary review

pursuant to section 9.

(B)  The written procedures governing the

voluntary review, including any required time frame

for the review.

(C)  A description of the procedures for

obtaining an independent external review of the final

adverse determination if the covered person decides

not to file for an additional voluntary review of the

first level review decision involving an adverse

determination.

(D)  The covered person's right to bring a civil

action in a court of competent jurisdiction.

(viii)  If applicable, the following statement: "You

and your plan may have other voluntary alternative

dispute resolution options, such as mediation. One way to

find out what may be available is to contact your state

Insurance Commissioner."

(ix)  Notice of the covered person's right to contact

the department's Bureau of Consumer Services for

assistance with respect to any claim, grievance or appeal

at any time, including the telephone number and address

of the department's Bureau of Consumer Services.

(i)  Appropriate notice.--

(1)  A health carrier shall provide the notice required

under subsection (h) in a culturally and linguistically

appropriate manner if required in accordance with Federal

regulations.

(2)  If a health carrier is required to provide the

notice required under this subsection in a culturally and

linguistically appropriate manner in accordance with Federal

regulations, the health carrier shall:

(i)  Include a statement in the English version of

the notice, prominently displayed in the non-English

language, offering the provision of the notice in the

non-English language.

(ii)  Once a utilization review or benefit

determination request has been made by a covered person,

provide all subsequent notices to the covered person in

the non-English language.

(iii)  To the extent the health carrier maintains a

consumer assistance process, such as a telephone hotline

that answers questions or provides assistance with filing

claims and appeals, the health carrier shall provide this

assistance in the non-English language.

Section 8.  Standard reviews of grievances not involving adverse

determination.

(a)  General rule.--A health carrier shall establish written

procedures for a standard review of a grievance that does not

involve an adverse determination.

(b)  Procedures.--

(1)  The procedures shall permit a covered person or the

covered person's authorized representative to file a

grievance that does not involve an adverse determination with

the health carrier under this section.

(2)  (i)  A covered person does not have the right to

attend, or to have a representative in attendance at the

standard review, but the covered person or the covered

person's authorized representative is entitled to submit

written material for the person or persons designated by

the carrier pursuant to subsection (c) to consider when

conducting the review.

(ii)  The health carrier shall make the provisions of

subparagraph (i) known to the covered person or, if

applicable, the covered person's authorized

representative within three working days after the date

of receiving the grievance.

(c)  Standard review.--

(1)  Upon receipt of the grievance, a health carrier

shall designate a person or persons to conduct the standard

review of the grievance.

(2)  The health carrier shall not designate the same

person or persons to conduct the standard review of the

grievance that denied the claim or handled the matter that is

the subject of the grievance.

(3)  The health carrier shall provide the covered person

or, if applicable, the covered person's authorized

representative with the name, address and telephone number of

a person designated to coordinate the standard review on

behalf of the health carrier.

(d)  Notification.--

(1)  The health carrier shall notify in writing the

covered person or, if applicable, the covered person's

authorized representative of the decision within 20 working

days after the date of receipt of the request for a standard

review of a grievance filed pursuant to subsection (b).

(2)  (i)  Subject to subparagraph (ii), if, due to

circumstances beyond the carrier's control, the health

carrier cannot make a decision and notify the covered

person or, if applicable, the covered person's authorized

representative pursuant to paragraph (1) within 20

working days, the health carrier may take up to an

additional ten working days to issue a written decision.

(ii)  A health carrier may extend the time for making

and notifying the covered person or, if applicable, the

covered person's authorized representative in accordance

with subparagraph (i) if, on or before the 20th working

day after the date of receiving the request for a

standard review of a grievance, the health carrier

provides written notice to the covered person or, if

applicable, the covered person's authorized

representative of the extension and the reasons for the

delay.

(e)  Written decision.--The written decision issued pursuant

to subsection (d) shall contain:

(1)  The titles and qualifying credentials of the person

or persons participating in the standard review process.

(2)  A statement of the reviewers' understanding of the

covered person's grievance.

(3)  The reviewers' decision in clear terms and the

contract basis in sufficient detail for the covered person to

respond further to the health carrier's position.

(4)  A reference to the evidence or documentation used as

the basis for the decision.

(5)  If applicable, a statement indicating:

(i)  A description of the process to obtain an

additional review of the standard review decision if the

covered person wishes to request a voluntary review

pursuant to section 9.

(ii)  The written procedures governing the voluntary

review, including any required time frame for the review.

(6)  Notice of the covered person's right, at any time,

to contact the department, including the telephone number and

address of the department.

Section 9.  Voluntary level of reviews of grievances.

(a)  General rule.--

(1)  A health carrier that offers managed care plans

shall establish a voluntary review process for its managed

care plans to give those covered persons who are dissatisfied

with the first level review decision made pursuant to section

7, or who are dissatisfied with the standard review decision

made pursuant to section 8, the option to request an

additional voluntary review, at which the covered person or

the covered person's authorized representative has the right

to appear in person at the review meeting before designated

representatives of the health carrier.

(2)  This section shall not apply to health indemnity

plans.

(b)  Notice.--

(1)  A health carrier required by this section to

establish a voluntary review process shall provide covered

persons or their authorized representatives with notice, as

appropriate, of the option to file a request with the health

carrier for an additional voluntary review of the first level

review decision received under section 7 or the standard

review decision received under section 8.

(2)  Upon receipt of a request for an additional

voluntary review, the health carrier shall send notice to the

covered person or, if applicable, the covered person's

authorized representative of the covered person's right to:

(i)  Request, within the time frame specified in

paragraph (3)(i), the opportunity to appear in person

before a review panel of the health carrier's designated

representatives.

(ii)  Receive from the health carrier, upon request,

copies of all documents, records and other information

that is not confidential or privileged relevant to the

covered person's request for benefits.

(iii)  Present the covered person's case to the

review panel.

(iv)  Submit written comments, documents, records and

other material relating to the request for benefits for

the review panel to consider when conducting the review

both before and, if applicable, at the review meeting.

(v)  If applicable, ask questions of any

representative of the health carrier on the review panel.

(vi)  Be assisted or represented by an individual of

the covered person's choice.

(3)  (i)  A covered person or the authorized

representative of the covered person wishing to request

to appear in person before the review panel of the health

carrier's designated representatives shall make the

request to the health carrier within five working days

after the date of receipt of the notice sent in

accordance with paragraph (2).

(ii)  The covered person's right to a fair review

shall not be made conditional on the covered person's

appearance at the review.

(c)  Review panel for first level review.--

(1)  (i)  With respect to a voluntary review of a first

level review decision made pursuant to section 7, a

health carrier shall appoint a review panel to review the

request.

(ii)  In conducting the review, the review panel

shall take into consideration all comments, documents,

records and other information regarding the request for

benefits submitted by the covered person or the covered

person's authorized representative pursuant to subsection

(b)(2), without regard to whether the information was

submitted or considered in reaching the first level

review decision.

(iii)  The panel shall have the legal authority to

bind the health carrier to the panel's decision.

(2)  (i)  Except as provided in subparagraph (ii), a

majority of the panel shall be comprised of individuals

who were not involved in the in the first level review

decision made pursuant to section 7.

(ii)  An individual who was involved with the first

level review decision may be a member of the panel or

appear before the panel to present information or answer

questions.

(iii)  The health carrier shall ensure that a

majority of the individuals conducting the additional

voluntary review of the first level review decision made

pursuant to section 7 are health care professionals who

have appropriate expertise.

(iv)  Except, when such a reviewing health care

professional is not reasonably available, in cases where

there has been a denial of a health care service, the

reviewing health care professional shall not:

(A)  Be a provider in the covered person's health

benefit plan.

(B)  Have a financial interest in the outcome of

the review.

(d)  Review panel for standard review.--

(1)  (i)  With respect to a voluntary review of a

standard review decision made pursuant to section 8, a

health carrier shall appoint a review panel to review the

request.

(ii)  The panel shall have the legal authority to

bind the health carrier to the panel's decision.

(2)  (i)  Except as provided in subparagraph (ii), a

majority of the panel shall be comprised of employees or

representatives of the health carrier who were not

involved in the standard review decision made pursuant to

section 8.

(ii)  An employee or representative of the health

carrier who was involved with the standard review

decision may be a member of the panel or appear before

the panel to present information or answer questions.

(e)  Opportunity to appear in person.--

(1)  (i)  Whenever a covered person or the covered

person's authorized representative requests within the

time frame specified in subsection (b)(3)(i), the

opportunity to appear in person before the review panel

appointed pursuant to subsection (c) or (d), the

procedures for conducting the review shall include the

provisions described in this paragraph.

(ii)  (A)  The review panel shall schedule and hold a

review meeting within 45 working days after the date

of receipt of the request.

(B)  The covered person or, if applicable, the

covered person's authorized representative shall be

notified in writing at least 15 working days in

advance of the date of the review meeting.

(C)  The health carrier shall not unreasonably

deny a request for postponement of the review made by

the covered person or the covered person's authorized

representative.

(iii)  The review meeting shall be held during

regular business hours at a location reasonably

accessible to the covered person or, if applicable, the

covered person's authorized representative.

(iv)  In cases where a face-to-face meeting is not

practical for geographic reasons, a health carrier shall

offer the covered person or, if applicable, the covered

person's authorized representative the opportunity to

communicate with the review panel, at the health

carrier's expense, by conference call, video conferencing

or other appropriate technology.

(v)  If the health carrier desires to have an

attorney present to represent the interests of the health

carrier, the health carrier shall notify the covered

person or, if applicable, the covered person's authorized

representative at least 15 working days in advance of the

date of the review meeting that an attorney will be

present and that the covered person may wish to obtain

legal representation of his or her own.

(vi)  The review panel shall issue a written

decision, as provided in subsection (f), to the covered

person or, if applicable, the covered person's authorized

representative within five working days of completing the

review meeting.

(2)  Whenever the covered person or, if applicable, the

covered person's authorized representative does not request

the opportunity to appear in person before the review panel

within the specified time frame provided under subsection (b)

(3)(i), the review panel shall issue a decision and notify

the covered person or, if applicable, the covered person's

authorized representative of the decision, as provided in

subsection (f), in writing or electronically, within 45

working days after the earlier of:

(i)  the date the covered person or the covered

person's authorized representative notifies the health

carrier of the covered person's decision not to request

the opportunity to appear in person before the review

panel; or

(ii)  the date on which the covered person's or the

covered person's authorized representative's opportunity

to request to appear in person before the review panel

expires pursuant to subsection (b)(3)(i) ????.

(3)  For purposes of calculating the time periods within

which a decision is required to be made and notice provided

under paragraphs (1) and (2), the time period shall begin on

the date the request for an additional voluntary review is

filed with the health carrier in accordance with the health

carrier's procedures established pursuant to section 6 for

filing a request without regard to whether all of the

information necessary to make the determination accompanies

the filing.

(f)  Manner of decision.--A decision issued pursuant to

subsection (e) shall include:

(1)  The titles and qualifying credentials of the members

of the review panel.

(2)  A statement of the review panel's understanding of

the nature of the grievance and all pertinent facts.

(3)  The rationale for the review panel's decision.

(4)  A reference to evidence or documentation considered

by the review panel in making that decision.

(5)  In cases concerning a grievance involving an adverse

determination:

(i)  The instructions for requesting a written

statement of the clinical rationale, including the

clinical review criteria used to make the determination.

(ii)  If applicable, a statement describing the

procedures for obtaining an independent external review

of the adverse determination.

(6)  Notice of the covered person's right to contact the

department's Bureau of Consumer Services for assistance with

respect to any claim, grievance or appeal at any time,

including the telephone number and address of the department.

Section 10.  Expedited reviews of grievances involving adverse

determination.

(a)  General rule.--A health carrier shall establish written

procedures for the expedited review of urgent care requests of

grievances involving an adverse determination.

(b)  Expedited review.--In addition to subsection (a), a

health carrier shall provide expedited review of a grievance

involving an adverse determination with respect to concurrent

review urgent care requests involving an admission, availability

of care, continued stay or health care service for a covered

person who has received emergency services, but has not been

discharged from a facility.

(c)  Requests.--The procedures shall allow a covered person

or the covered person's authorized representative to request an

expedited review under this section orally or in writing.

(d)  Appointments.--A health carrier shall appoint an

appropriate clinical peer or peers in the same or similar

specialty as would typically manage the case being reviewed to

review the adverse determination. The clinical peer or peers

shall not have been involved in making the initial adverse

determination.

(e)  Transmission of information.--In an expedited review,

all necessary information, including the health carrier's

decision, shall be transmitted between the health carrier and

the covered person or, if applicable, the covered person's

authorized representative by telephone, facsimile or the most

expeditious method available.

(f)  Notification.--

(1)  An expedited review decision shall be made and the

covered person or, if applicable, the covered person's

authorized representative shall be notified of the decision

in accordance with subsection (h) as expeditiously as the

covered person's medical condition requires, but in no event

more than 72 hours after the receipt of the request for the

expedited review.

(2)  If the expedited review is of a grievance involving

an adverse determination with respect to a concurrent review

urgent care request, the service shall be continued without

liability to the covered person until the covered person has

been notified of the determination.

(g)  Time periods.--For purposes of calculating the time

periods within which a decision is required to be made under

subsection (f), the time period within which the decision is

required to be made shall begin on the date the request is filed

with the health carrier in accordance with the health carrier's

procedures established pursuant to section 6 for filing a

request without regard to whether all of the information

necessary to make the determination accompanies the filing.

(h)  Manner of notification.--

(1)  A notification of a decision under this section

shall, in a manner calculated to be understood by the covered

person or, if applicable, the covered person's authorized

representative, set forth:

(i)  The titles and qualifying credentials of the

person or persons participating in the expedited review

process.

(ii)  Information sufficient to identify the claim

involved with respect to the grievance, including the

date of service, the health care provider, if applicable,

the claim amount, the diagnosis code and its

corresponding meaning and the treatment code and its

corresponding meaning.

(iii)  A statement of the reviewers' understanding of

the covered person's grievance.

(iv)  The reviewers' decision in clear terms and the

contract basis or medical rationale in sufficient detail

for the covered person to respond further to the health

carrier's position.

(v)  A reference to the evidence or documentation

used as the basis for the decision.

(vi)  If the decision involves a final adverse

determination, the notice shall provide:

(A)  The specific reasons or reasons for the

final adverse determination, including the denial

code and its corresponding meaning, as well as a

description of the health carrier's standard, if any,

that was used in reaching the denial.

(B)  Reference to the specific plan provisions on

which the determination is based.

(C)  A description of any additional material or

information necessary for the covered person to

complete the request, including an explanation of why

the material or information is necessary to complete

the request.

(D)  If the health carrier relied upon an

internal rule, guideline, protocol or other similar

criterion to make the adverse determination, either

the specific rule, guideline, protocol or other

similar criterion or a statement that a specific

rule, guideline, protocol or other similar criterion

was relied upon to make the adverse determination and

that a copy of the rule, guideline, protocol or other

similar criterion will be provided free of charge to

the covered person upon request.

(E)  If the final adverse determination is based

on a medical necessity or experimental or

investigational treatment or similar exclusion or

limit, either an explanation of the scientific or

clinical judgment for making the determination,

applying the terms of the health benefit plan to the

covered person's medical circumstances or a statement

that an explanation will be provided to the covered

person free of charge upon request.

(F)  If applicable, instructions for requesting:

(I)  a copy of the rule, guideline, protocol

or other similar criterion relied upon in making

the adverse determination in accordance with

subparagraph (iv); or

(II)  the written statement of the scientific

or clinical rationale for the adverse

determination in accordance with subparagraph

(v).

(G)  A statement describing the procedures for

obtaining an independent external review of the

adverse determination.

(H)  A statement indicating the covered person's

right to bring a civil action in a court of competent

jurisdiction.

(I)  The following statement: "You and your plan

may have other voluntary alternative dispute

resolution options, such as mediation. One way to

find out what may be available is to contact your

state Insurance Commissioner."

(J)  A notice of the covered person's right to

contact the department's Bureau of Consumer Services

for assistance with respect to the any claim,

grievance or appeal at any time, including the

telephone number and address of the department's

Bureau of Consumer Services.

(2)  (i)  A health carrier shall provide the notice

required under this section in a culturally and

linguistically appropriate manner if required in

accordance with Federal regulations.

(ii)  If a health carrier is required to provide the

notice required under this section in a culturally and

linguistically appropriate manner in accordance with

Federal regulations, the health carrier shall:

(A)  Include a statement in the English version

of the notice, prominently displayed in the non-

English language, offering the provision of the

notice in the non-English language.

(B)  Once a utilization review or benefit

determination request has been made by a covered

person, provide all subsequent notices to the covered

person in the non-English language.

(C)  To the extent the health carrier maintains a

consumer assistance process, such as a telephone

hotline that answers questions or provides assistance

with filing claims and appeals, the health carrier

shall provide this assistance in the non-English

language.

(3)  (i)  A health carrier may provide the notice

required under this section orally, in writing or

electronically.

(ii)  If notice of the adverse determination is

provided orally, the health carrier shall provide written

or electronic notice of the adverse determination within

three days following the oral notification.

Section 11.  Regulations.

The department shall promulgate all necessary and proper

regulations for implementation and administration of this act.

Section 12.  Penalties.

(a)  Civil penalty.--The department may impose a civil

penalty of up to $5,000 for a violation of this act.

(b)  Injunction.--The department may maintain an action in

the name of the Commonwealth for an injunction to prohibit any

activity which violates the provisions of this act.

(c)  Prohibitions.--The department may issue an order

temporarily prohibiting a health carrier which violates this act

from enrolling new members.

(d)  Plan of correction.--The department may require a health

carrier to develop and adhere to a plan of correction approved

by the department. The department shall monitor compliance with

the plan of correction. The plan of correction shall be

available to enrollees of the health carrier.

Section 13. Administrative review.

The provisions of this act shall be subject to 2 Pa.C.S. Ch.

5 Subch. A (relating to practice and procedure of Commonwealth

agencies).

Section 14.  Repeals.

The provisions of Article XXI of the act of May 17, 1921

(P.L.682, No.284), known as The Insurance Company Law of 1921,

are repealed insofar as they are inconsistent with this act.

Section 15.  Effective date.

This act shall take effect in 180 days.