SENATE AMENDED PRIOR PRINTER'S NOS. 2965, 3231, 3450 PRINTER'S NO. 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 D. WHITE, BANKING AND INSURANCE, IN SENATE, AS AMENDED, SEPTEMBER 17, 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: 21 "Centers for Medicare and Medicaid Services" or "CMS." The
1 Centers for Medicare and Medicaid Services within the United 2 States Department of Health and Human Services. 3 "Department." The Insurance Department of the Commonwealth. 4 "Facility." A health care facility as defined in section 5 802.1 of the act of July 19, 1979 (P.L.130, No.48), known as the 6 Health Care Facilities Act, or an entity licensed as a hospital 7 under the act of June 13, 1967 (P.L.31, No.21), known as the 8 Public Welfare Code. 9 "Health care provider." A health care facility or a person, 10 including a corporation, university or other educational 11 institution licensed or approved by the Commonwealth to provide 12 health care or professional medical services as a physician, a 13 certified nurse midwife, a podiatrist, a certified registered 14 nurse practitioner, a physician assistant, a chiropractor, a 15 hospital, an ambulatory surgery center, a nursing home and a 16 birth center. 17 "Health payor." An individual or entity providing a group 18 health, sickness or accident policy, subscriber contract or 19 program issued or provided by an entity, including any one of 20 the following: 21 (1) The act of June 2, 1915 (P.L.736, No.338), known as 22 the Workers' Compensation Act. 23 (2) The act of May 17, 1921 (P.L.682, No.284), known as 24 The Insurance Company Law of 1921. 25 (3) The act of December 29, 1972 (P.L.1701, No.364), 26 known as the Health Maintenance Organization Act. 27 (4) The act of May 18, 1976 (P.L.123, No.54), known as 28 the Individual Accident and Sickness Insurance Minimum 29 Standards Act. 30 (5) 40 Pa.C.S. Ch. 61 (relating to hospital plan 20070H2098B4346 - 2 -
1 corporations). 2 (6) 40 Pa.C.S. Ch. 63 (relating to professional health 3 services plan corporations). 4 "Medical assistance." The Commonwealth's medical assistance 5 program established under the act of June 13, 1967 (P.L.31, 6 No.21), known as the Public Welfare Code. 7 "Preventable serious adverse event." A clearly defined 8 condition or negative consequence of care that results in 9 unintended injury or illness that could have been anticipated 10 and prepared for, but that occurs because of an error or other 11 system failure and results in a patient's death, loss of a body 12 part, disability or loss of bodily function lasting more than 13 seven days. 14 Section 3. Payment policy for preventable serious adverse 15 events. 16 (a) General rule.--The following criteria shall be used by 17 health payors in determining when payment or partial payment to 18 a health care provider will be withheld: 19 (1) A preventable serious adverse event must occur. 20 (2) The preventable serious adverse event must be within 21 the control of the health care provider. 22 (3) The preventable serious adverse event must occur in 23 a health care facility. 24 (b) Language addressing payment policy.--Payments can only 25 be withheld by health payors for services related to a 26 preventable serious adverse event or care made necessary by the 27 preventable serious adverse event if the agreement or contract 28 between the health payor and health care provider contains 29 language addressing payment policy for preventable serious 30 adverse events. 20070H2098B4346 - 3 -
1 (c) Restriction.--Health care providers shall not seek 2 payment directly from patients or the responsible party of the 3 patient for preventable serious adverse events. 4 Section 4. Duties of Department of Public Welfare. 5 (a) Department responsibilities.--The Department of Public 6 Welfare is responsible for the following: 7 (1) Determining payment policy under medical assistance 8 with respect to reduced reimbursements to health care 9 providers for preventable serious adverse events. This 10 payment policy includes the criteria and clearly stated 11 payment policies affecting health care providers. 12 (2) Publishing the payment policy in the Pennsylvania 13 Bulletin following a 30-day public comment period. 14 (b) Ongoing reviews.--Nothing in this section shall affect 15 ongoing reviews of medical assistance services conducted by the 16 Department of Public Welfare. 17 (c) Hospital payment policy.--Nothing in this section shall 18 require the department to alter, amend or reissue any payment 19 policy for inpatient hospitals relating to preventable serious 20 adverse events that was promulgated prior to the enactment of 21 this act. 22 Section 5. Duties of Insurance Department. 23 (a) Notice of preventable serious adverse events.--The 24 department shall annually notify health payors of the list of 25 preventable serious adverse events that CMS is using under the 26 Medicare program and for which health payors may withhold 27 reimbursement under section 3. 28 (b) Notice of CMS rule.--The department shall transmit 29 notice of the effective date of the CMS Hospital-Acquired 30 Conditions, Including Infections, Final Rule, to the Legislative 20070H2098B4346 - 4 -
1 Reference Bureau for publication in the Pennsylvania Bulletin. 2 Section 6. Duties of Department of Health. 3 In accordance with the act of July 19, 1979 (P.L.130, No.48), 4 known as the Health Care Facilities Act, the Department of 5 Health shall be responsible for investigating patient complaints 6 regarding a health care facility that is seeking payment 7 directly from the patient for a preventable serious adverse 8 event. 9 Section 7. Duties of Department of State. 10 The Department of State shall be responsible for 11 investigating complaints regarding a health care provider that 12 is not a health care facility that is seeking or causing to be 13 sought payment directly from the patient or responsible party of 14 the patient for a preventable serious adverse event. 15 Section 19. Applicability. 16 This act shall apply to preventable serious adverse events 17 that occur after the later of the following: 18 (1) Publication of the notice under section 5(b). 19 (2) October 1, 2008. 20 Section 20. Effective date. 21 This act shall take effect immediately. 22 SECTION 1. SHORT TITLE. <-- 23 THIS ACT SHALL BE KNOWN AND MAY BE CITED AS THE PREVENTABLE 24 SERIOUS ADVERSE EVENTS ACT. 25 SECTION 2. 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 "HEALTH CARE FACILITY." A HEALTH CARE FACILITY AS DEFINED 30 UNDER SECTION 802.1 OF THE ACT OF JULY 19, 1979 (P.L.130, 20070H2098B4346 - 5 -
1 NO.48), KNOWN AS THE HEALTH CARE FACILITIES ACT, OR AN ENTITY 2 LICENSED AS A HOSPITAL UNDER THE ACT OF JUNE 13, 1967 (P.L.31, 3 NO.21), KNOWN AS THE PUBLIC WELFARE CODE. 4 "HEALTH CARE PROVIDER." A HEALTH CARE FACILITY OR A PERSON, 5 INCLUDING A CORPORATION, UNIVERSITY OR OTHER EDUCATIONAL 6 INSTITUTION, LICENSED OR APPROVED BY THE COMMONWEALTH TO PROVIDE 7 HEALTH CARE OR PROFESSIONAL MEDICAL SERVICES. THE TERM SHALL 8 INCLUDE, BUT NOT BE LIMITED TO, A PHYSICIAN, A CERTIFIED NURSE 9 MIDWIFE, A PODIATRIST, A CERTIFIED REGISTERED NURSE 10 PRACTITIONER, A PHYSICIAN ASSISTANT, A CHIROPRACTOR, A HOSPITAL, 11 AN AMBULATORY SURGERY CENTER, A NURSING HOME OR A BIRTH CENTER. 12 "HEALTH PAYOR." AN INDIVIDUAL OR ENTITY PAYING FOR HEALTH 13 SERVICES ON BEHALF OF ANOTHER. 14 "MEDICAL ASSISTANCE." THE COMMONWEALTH'S MEDICAL ASSISTANCE 15 PROGRAM ESTABLISHED UNDER THE ACT OF JUNE 13, 1967 (P.L.31, 16 NO.21), KNOWN AS THE PUBLIC WELFARE CODE. 17 "NATIONAL QUALITY FORUM." A NOT-FOR-PROFIT MEMBERSHIP 18 ORGANIZATION CREATED TO DEVELOP AND IMPLEMENT A NATIONAL 19 STRATEGY FOR HEALTH CARE QUALITY MEASUREMENT AND REPORTING. 20 "PREVENTABLE SERIOUS ADVERSE EVENT." AN EVENT THAT OCCURS IN 21 A HEALTH CARE FACILITY THAT IS WITHIN THE HEALTH CARE PROVIDER'S 22 CONTROL TO AVOID, BUT THAT OCCURS BECAUSE OF AN ERROR OR OTHER 23 SYSTEM FAILURE AND RESULTS IN A PATIENT'S DEATH, LOSS OF BODY 24 PART, DISFIGUREMENT, DISABILITY OR LOSS OF BODILY FUNCTION 25 LASTING MORE THAN SEVEN DAYS OR STILL PRESENT AT THE TIME OF 26 DISCHARGE FROM A HEALTH CARE FACILITY. SUCH EVENTS SHALL BE 27 WITHIN THE LIST OF REPORTABLE SERIOUS EVENTS ADOPTED BY THE 28 NATIONAL QUALITY FORUM. 29 SECTION 3. PAYMENT POLICY FOR PREVENTABLE SERIOUS ADVERSE 30 EVENTS. 20070H2098B4346 - 6 -
1 (A) GENERAL RULE.--HEALTH CARE PROVIDERS MAY NOT KNOWINGLY 2 SEEK PAYMENT FROM HEALTH PAYORS, PATIENTS OR THE RESPONSIBLE 3 PARTY OF THE PATIENT FOR A PREVENTABLE SERIOUS ADVERSE EVENT OR 4 SERVICES REQUIRED TO CORRECT OR TREAT THE PROBLEM CREATED BY 5 SUCH AN EVENT WHEN SUCH AN EVENT OCCURRED UNDER THEIR CONTROL. 6 (B) REFUNDS.--A HEALTH CARE PROVIDER WHO DISCOVERS THAT 7 PAYMENT HAS UNKNOWINGLY BEEN SOUGHT FOR A PREVENTABLE SERIOUS 8 ADVERSE EVENT OR SERVICES REQUIRED TO CORRECT OR TREAT THE 9 PROBLEM CREATED BY SUCH AN EVENT SHALL IMMEDIATELY NOTIFY THE 10 HEALTH PAYOR, PATIENT OR THE RESPONSIBLE PARTY OF THE PATIENT 11 AND SHALL REFUND ANY PAYMENT RECEIVED WITHIN 30 DAYS OF 12 DISCOVERY OR RECEIPT OF PAYMENT, WHICHEVER IS LATER. 13 (C) NOTIFICATION.--A HEALTH CARE PAYOR WHO DISCOVERS THAT 14 PAYMENT HAS BEEN SOUGHT FOR A PREVENTABLE SERIOUS ADVERSE EVENT 15 OR SERVICES REQUIRED TO CORRECT OR TREAT A PROBLEM CREATED BY 16 SUCH AN EVENT SHALL NOTIFY THE HEALTH CARE PROVIDER THAT PAYMENT 17 MAY NOT BE SOUGHT FOR SUCH AN EVENT OR SERVICES AND THAT PAYMENT 18 SHALL NOT BE MADE FOR SUCH EVENTS OR SERVICES. 19 (D) LIABILITY.--ANY INFORMATION PROVIDED TO ANY HEALTH CARE 20 PAYOR OR HEALTH CARE PROVIDER, IN COMPLIANCE WITH SUBSECTIONS 21 (B) AND (C), SHALL NOT BE DISCOVERABLE OR ADMISSIBLE IN ANY 22 CIVIL OR ADMINISTRATIVE ACTION RELATED TO THE ACT OF MARCH 20, 23 2002 (P.L.154, NO.13), KNOWN AS THE MEDICAL CARE AVAILABILITY 24 AND REDUCTION OF ERROR (MCARE) ACT. 25 SECTION 4. DUTIES OF DEPARTMENT OF HEALTH. 26 (A) PUBLISHING OF UPDATES.--THE DEPARTMENT SHALL PUBLISH IN 27 THE PENNSYLVANIA BULLETIN ANY UPDATES TO THE LIST OF REPORTABLE 28 SERIOUS ADVERSE EVENTS ADOPTED BY THE NATIONAL QUALITY FORUM 29 WITHIN 30 DAYS OF THE UPDATE ISSUED BY THE NATIONAL QUALITY 30 FORUM. 20070H2098B4346 - 7 -
1 (B) HEALTH DEPARTMENT RESPONSIBILITY.--IN ACCORDANCE WITH 2 THE ACT OF JULY 19, 1979 (P.L.130, NO.48), KNOWN AS THE HEALTH 3 CARE FACILITIES ACT, THE DEPARTMENT OF HEALTH SHALL BE 4 RESPONSIBLE FOR INVESTIGATING PATIENT COMPLAINTS REGARDING A 5 HEALTH CARE FACILITY THAT IS SEEKING PAYMENT DIRECTLY FROM THE 6 PATIENT OR HEALTH CARE PAYOR FOR A PREVENTABLE SERIOUS ADVERSE 7 EVENT. 8 SECTION 5. DUTIES OF DEPARTMENT OF STATE. 9 THE DEPARTMENT OF STATE SHALL BE RESPONSIBLE FOR 10 INVESTIGATING PATIENT COMPLAINTS REGARDING A HEALTH CARE 11 PROVIDER THAT IS NOT A HEALTH CARE FACILITY THAT IS SEEKING OR 12 CAUSING TO BE SOUGHT PAYMENT DIRECTLY FROM THE PATIENT OR HEALTH 13 CARE PAYOR FOR A PREVENTABLE SERIOUS ADVERSE EVENT. 14 SECTION 6. APPLICABILITY. 15 (A) HOSPITAL MEDICAL ASSISTANCE PAYMENT POLICY.--NOTHING IN 16 THIS ACT SHALL REQUIRE THE DEPARTMENT OF PUBLIC WELFARE TO 17 ALTER, AMEND OR REISSUE ANY PAYMENT POLICY FOR INPATIENT 18 HOSPITALS RELATING TO PREVENTABLE SERIOUS ADVERSE EVENTS THAT 19 WAS PROMULGATED PRIOR TO THE ENACTMENT OF THIS ACT. ANY 20 MODIFICATIONS TO THE DEPARTMENT OF PUBLIC WELFARE PAYMENT POLICY 21 PROMULGATED ON OR AFTER THE DATE OF ENACTMENT OF THIS ACT FOR A 22 HEALTH CARE PROVIDER FOR A PREVENTABLE SERIOUS ADVERSE EVENT 23 SHALL REQUIRE A 30-DAY PUBLIC COMMENT PERIOD. 24 (B) CONTRACTS.--NOTHING IN THIS ACT SHALL PROHIBIT A HEALTH 25 CARE PROVIDER AND PAYOR FROM ESTABLISHING BY CONTRACT ANY 26 POLICIES AND PROCEDURES ASSOCIATED WITH SERIOUS PREVENTABLE 27 ADVERSE EVENTS NECESSARY TO IMPLEMENT THE PROVISIONS OF THIS 28 ACT. 29 (C) REPORTING.-- 30 (1) HEALTH CARE PROVIDERS SHALL INCLUDE ALL APPLICABLE 20070H2098B4346 - 8 -
1 MEDICAL CODES IN MAKING REPORTS IN COMPLIANCE WITH THE ACT OF 2 JULY 8, 1986 (P.L.408, NO.89), KNOWN AS THE HEALTH CARE COST 3 CONTAINMENT ACT. 4 (2) A PREVENTABLE SERIOUS ADVERSE EVENT SHALL BE 5 REPORTED PURSUANT TO THE REQUIREMENTS OF THE ACT OF MARCH 20, 6 2002 (P.L.154, NO.13), KNOWN AS THE MEDICAL CARE AVAILABILITY 7 AND REDUCTION OF ERROR (MCARE) ACT. 8 SECTION 7. EFFECTIVE DATE. 9 THIS ACT SHALL TAKE EFFECT IN 180 DAYS. K20L40GRH/20070H2098B4346 - 9 -