PRINTER'S NO. 1941
No. 1355 Session of 2008
INTRODUCED BY HUGHES, COSTA, WASHINGTON, KITCHEN, STACK,
C. WILLIAMS, FONTANA, STOUT, MUSTO, O'PAKE AND FUMO,
APRIL 9, 2008
REFERRED TO BANKING AND INSURANCE, APRIL 9, 2008
AN ACT
1 Amending the act of March 20, 2002 (P.L.154, No.13), entitled
2 "An act reforming the law on medical professional liability;
3 providing for patient safety and reporting; establishing the
4 Patient Safety Authority and the Patient Safety Trust Fund;
5 abrogating regulations; providing for medical professional
6 liability informed consent, damages, expert qualifications,
7 limitations of actions and medical records; establishing the
8 Interbranch Commission on Venue; providing for medical
9 professional liability insurance; establishing the Medical
10 Care Availability and Reduction of Error Fund; providing for
11 medical professional liability claims; establishing the Joint
12 Underwriting Association; regulating medical professional
13 liability insurance; providing for medical licensure
14 regulation; providing for administration; imposing penalties;
15 and making repeals," establishing the Pennsylvania Access to
16 Basic Care (PA ABC) Program Fund and the Pennsylvania Access
17 to Basic Care (PA ABC) Program; providing for health care
18 coverage for certain adults, individuals, employees and
19 employers and for expiration of certain sections; and
20 repealing provisions of the Tobacco Settlement Act.
21 The General Assembly of the Commonwealth of Pennsylvania
22 hereby enacts as follows:
23 Section 1. Chapter 7 of the act of March 20, 2002 (P.L.154,
24 No.13), known as the Medical Care Availability and Reduction of
25 Error (Mcare) Act, is amended by adding a subchapter to read:
26 SUBCHAPTER E
1 PENNSYLVANIA ACCESS TO BASIC CARE
2 (PA ABC) PROGRAM FUND
3 Section 751. Establishment.
4 There is established within the State Treasury a special fund
5 to be known as the Pennsylvania Access to Basic Care (PA ABC)
6 Program Fund.
7 Section 752. Allocation.
8 Money in the Pennsylvania Access to Basic Care (PA ABC)
9 Program Fund is hereby appropriated upon approval of the
10 Governor for health care coverage and services under Chapter 13.
11 Section 2. The act is amended by adding a chapter to read:
12 CHAPTER 13
13 PENNSYLVANIA ACCESS TO BASIC CARE (PA ABC) PROGRAM
14 Section 1301. Scope.
15 This chapter relates to offering health care coverage to
16 eligible adults, individuals, employees and employers.
17 Section 1302. Definitions.
18 The following words and phrases when used in this chapter
19 shall have the meanings given to them in this section unless the
20 context clearly indicates otherwise:
21 "AdultBasic Program." The adult basic coverage insurance
22 program established under section 1303 of the act of June 26,
23 2001 (P.L.755, No.77), known as the Tobacco Settlement Act.
24 "Average annual wage." The total annual wages paid by an
25 employer divided by the number of the employer's full-time
26 equivalent employees.
27 "Behavioral health services." Mental health or substance
28 abuse services.
29 "Children's health insurance program." The children's health
30 care program established under Article XXIII of the act of May
20080S1355B1941 - 2 -
1 17, 1921 (P.L.682, No.284), known as The Insurance Company Law
2 of 1921.
3 "Chronic disease management program." A program that allows
4 a patient, with the support of a health care team, to play an
5 active role in the patient's care and assures that there is an
6 infrastructure to ensure compliance with established practice
7 guidelines.
8 "Community Health Reinvestment Agreement." The Agreement on
9 Community Health Reinvestment entered into February 2, 2005, by
10 the Insurance Department and Capital Blue Cross, Highmark Inc.,
11 Hospital Service Association of Northeastern Pennsylvania and
12 Independence Blue Cross and published in the Pennsylvania
13 Bulletin at 35 Pa.B. 4155.
14 "Contractor." An insurer awarded a contract to provide
15 health care services under this chapter. The term includes an
16 entity and its subsidiary which is established under 40 Pa.C.S.
17 Ch. 61 (relating to hospital plan corporations) or 63 (relating
18 to professional health services plan corporations), the act of
19 May 17, 1921 (P.L.682, No.284), known as The Insurance Company
20 Law of 1921, or the act of December 29, 1972 (P.L.1701, No.364),
21 known as the Health Maintenance Organization Act.
22 "Department." The Insurance Department of the Commonwealth.
23 "Eligible adult." An individual who is currently enrolled in
24 the Adultbasic Program, is on the waiting list for that program
25 on the effective date of this section or meets all of the
26 following:
27 (1) Is at least 19 years of age but not more than 64
28 years of age.
29 (2) Legally resides within the United States.
30 (3) Has been domiciled in this Commonwealth for at least
20080S1355B1941 - 3 -
1 90 days prior to application to the program.
2 (4) Is ineligible to receive continuous eligibility
3 coverage under Title XIX or XXI of the Social Security Act
4 (49 Stat. 620, 42 U.S.C. § 301 et seq.), except for benefits
5 authorized under a waiver granted by the United States
6 Department of Health and Human Services to implement the
7 Pennsylvania Access to Basic Care (PA ABC) Program.
8 (5) Is ineligible for medical assistance or Medicare.
9 (6) Subject to the provisions of section 1305, has a
10 household income that is no greater than 300% of the Federal
11 poverty level at the time of application.
12 (7) Has not been covered by any health insurance plan or
13 program for at least 180 days immediately preceding the date
14 of application, except that the 180-day period shall not
15 apply to an eligible adult who meets one of the following:
16 (i) is eligible to receive benefits under the act of
17 December 5, 1936 (2nd Sp.Sess., 1937 P.L.2897, No.1),
18 known as the Unemployment Compensation Law;
19 (ii) was covered under a health insurance plan or
20 program provided by an employer, but at the time of
21 application is no longer covered because of a change in
22 the individual's employment status and is ineligible to
23 receive benefits under the Unemployment Compensation Law;
24 (iii) lost coverage as a result of divorce or
25 separation from a covered individual, the death of a
26 covered individual or a change in employment status of a
27 covered individual; or
28 (iv) is transferring from another government-
29 subsidized health program, including a transfer that
30 occurs as a result of failure to meet income eligibility
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1 requirements.
2 "Eligible employee." An eligible adult or an employee who
3 meets all the requirements of an eligible adult or employee at
4 the time the eligible employer makes application to the program.
5 "Eligible employer." An employer that meets all of the
6 following:
7 (1) Has at least two but not more than 50 full-time
8 equivalent employees.
9 (2) Has not offered health care coverage through any
10 plan or program during the 180 days immediately preceding the
11 date of application for participation in the Pennsylvania
12 Access to Basic Care (PA ABC) Program.
13 (3) Has not provided remuneration in any form to an
14 employee for the purchase of health care coverage during the
15 180 days immediately preceding the date on which the employer
16 applies for participation in the program.
17 (4) Pays an average annual wage that is less than 300%
18 of the Federal poverty level for an individual.
19 "Employee." An individual who is employed for more than 20
20 hours in a single week and from whose wages an employer is
21 required under the Internal Revenue Code of 1986 (Public Law 99-
22 514, 26 U.S.C. § 1 et seq.) to withhold Federal income tax.
23 "Employer." The term shall include:
24 (1) Any of the following who or which employs two but
25 not more than 50 employees to perform services for
26 remuneration:
27 (i) an individual, partnership, association,
28 domestic or foreign corporation or other entity;
29 (ii) the legal representative, trustee in
30 bankruptcy, receiver or trustee of any individual,
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1 partnership, association or corporation or other entity;
2 or
3 (iii) the legal representative of a deceased
4 individual.
5 (2) An individual who is self-employed.
6 (3) The executive, legislative and judicial branches of
7 the Commonwealth and any one of its political subdivisions.
8 "Fund." The Pennsylvania Access to Basic Care (PA ABC)
9 Program Fund.
10 "Health benefit plan." An insurance coverage plan that
11 provides the benefits set forth under section 1313. The term
12 does not include any of the following:
13 (1) An accident-only policy.
14 (2) A credit-only policy.
15 (3) A long-term or disability income policy.
16 (4) A specified disease policy.
17 (5) A Medicare supplement policy.
18 (6) A Civilian Health and Medical Program of the
19 Uniformed Services (CHAMPUS) supplement policy.
20 (7) A fixed indemnity policy.
21 (8) A dental-only policy.
22 (9) A vision-only policy.
23 (10) A workers' compensation policy.
24 (11) An automobile medical payment policy pursuant to 75
25 Pa.C.S. (relating to vehicles).
26 (12) Such other similar policies providing for limited
27 benefits.
28 "Health care coverage." A health benefit plan or other form
29 of health care coverage that is approved by the Department of
30 Community and Economic Development in consultation with the
20080S1355B1941 - 6 -
1 Insurance Department. The term does not include coverage under
2 the PA ABC program.
3 "Health maintenance organization" or "HMO." An entity
4 organized and regulated under the act of December 29, 1972
5 (P.L.1701, No.364), known as the Health Maintenance Organization
6 Act.
7 "Health savings account." An account established by an
8 employer under section 1307 on behalf of an employee whose
9 income is greater than 200% of the Federal poverty level.
10 "Hospital." An institution that has an organized medical
11 staff engaged primarily in providing to inpatients, by or under
12 the supervision of physicians, diagnostic and therapeutic
13 services for the care of injured, disabled, pregnant, diseased
14 or sick or mentally ill persons. The term includes a facility
15 for the diagnosis and treatment of disorders within the scope of
16 specific medical specialties. The term does not include a
17 facility that cares exclusively for the mentally ill.
18 "Hospital plan corporation." A hospital plan corporation as
19 defined in 40 Pa.C.S. § 6101 (relating to definitions).
20 "Individual." A natural person who meets all the
21 requirements of an eligible adult but whose household income is
22 greater than 300% of the Federal poverty level.
23 "Insurer." A company or health insurance entity licensed in
24 this Commonwealth to issue an individual or group health,
25 sickness or accident policy or subscriber contract or
26 certificate or plan that provides medical or health care
27 coverage by a health care facility or licensed health care
28 provider and that is offered or governed under any of the
29 following:
30 (1) The act of May 17, 1921 (P.L.682, No.284), known as
20080S1355B1941 - 7 -
1 The Insurance Company Law of 1921.
2 (2) The act of December 29, 1972 (P.L.1701, No.364),
3 known as the Health Maintenance Organization Act.
4 (3) The act of May 18, 1976 (P.L.123, No.54), known as
5 the Individual Accident and Sickness Insurance Minimum
6 Standards Act.
7 (4) 40 Pa.C.S. Ch. 61 (relating to hospital plan
8 corporations) or 63 (relating to professional health services
9 plan corporations).
10 "Medical assistance." The State program of medical
11 assistance established under the act of June 13, 1967 (P.L.31,
12 No.21), known as the Public Welfare Code.
13 "Medical loss ratio." The ratio of paid medical claim costs
14 to earned premiums.
15 "Medicare." The Federal program established under Title
16 XVIII of the Social Security Act (49 Stat. 620, 42 U.S.C. § 1395
17 et seq.).
18 "Offeror." An insurer that submits a bid or proposal under
19 section 1311 in response to the department's procurement
20 solicitation.
21 "Preexisting condition." A disease or physical condition for
22 which medical advice or treatment has been recommended or
23 received prior to the effective date of coverage.
24 "Prescription drug." A controlled substance, other drug or
25 device for medication dispensed by order of an appropriately
26 licensed medical professional.
27 "Professional health services plan corporation." A not-for-
28 profit corporation operating under the provisions of 40 Pa.C.S.
29 Ch. 63 (relating to professional health services plan
30 corporations).
20080S1355B1941 - 8 -
1 "Program." The Pennsylvania Access to Basic Care (PA ABC)
2 Program established under this chapter.
3 "Qualifying health care coverage." A health benefit plan or
4 other form of health care coverage actuarially equivalent to the
5 benefits in section 1313 and approved by the Insurance
6 Department.
7 "Terminate." The term includes cancellation, nonrenewal and
8 rescission.
9 "Unemployment Compensation Law." The act of December 5, 1936
10 (2nd Sp.Sess., 1937 P.L.2897, No.1), known as the Unemployment
11 Compensation Law.
12 "Uninsured period." A continuous period of time of not less
13 than 180 consecutive days immediately preceding application
14 during which an adult has been without health care coverage in
15 accordance with the requirements of this chapter.
16 Section 1303. Establishment of program.
17 The Pennsylvania Access to Basic Care (PA ABC) Program is
18 established in the department.
19 Section 1304. Funding.
20 (a) Sources.--The following are the sources of money for the
21 program:
22 (1) Money received from the Supplemental Assistance and
23 Funding Account established under section 1112(a.1).
24 (2) Money received from the Federal Government or other
25 sources.
26 (3) Money required to be deposited pursuant to other
27 provisions of this chapter or any other law of this
28 Commonwealth.
29 (4) Upon implementation of the program:
30 (i) Only those funds appropriated for health
20080S1355B1941 - 9 -
1 investment insurance under section 306(b)(1)(vi) of the
2 act of June 26, 2001 (P.L.755, No.77), known as the
3 Tobacco Settlement Act, and designated for the AdultBasic
4 Program.
5 (ii) Money currently required to be dedicated to the
6 AdultBasic Program or any alternative program to benefit
7 persons of low income under the Community Health
8 Reinvestment Agreement within the respective service
9 areas for each party to that agreement. Money under this
10 subparagraph shall be used only to defray the cost of the
11 program and subsidies approved under sections 1305 and
12 1306.
13 (5) Any moneys derived from whatever sources and
14 designated specifically to fund the program.
15 (6) Return on investments in the fund.
16 Section 1305. Purchase by eligible adults and individuals.
17 (a) Eligible adults.--An eligible adult or individual who
18 seeks to purchase coverage under the program must:
19 (1) Submit an application to the department or its
20 contractor.
21 (2) Pay to the department or its contractor the amount
22 of the premium specified.
23 (3) Be responsible for any required copayments for
24 health care services rendered under the health benefit plan
25 in section 1313 subject to Federal waiver requirements.
26 (4) Notify the department or its contractor of any
27 change in the eligible adult's or individual's household
28 income.
29 (b) Monthly premiums.--Except to the extent that changes may
30 be necessary to meet Federal requirements under section 1317 or
20080S1355B1941 - 10 -
1 to encourage eligible employer participation, subsidies for the
2 2008-2009 fiscal year and each fiscal year thereafter shall
3 result in the following premium amount based on household income
4 for a health benefit plan:
5 (1) For an eligible adult whose household income is not
6 greater than 150% of the Federal poverty level, no monthly
7 premium.
8 (2) For an eligible adult whose household income is
9 greater than 150% but not greater than 175% of the Federal
10 poverty level, a monthly premium of $40.
11 (3) For an eligible adult whose household income is
12 greater than 175% but not greater than 200% of the Federal
13 poverty level, a monthly premium of $50.
14 (4) For an eligible adult whose household income is
15 greater than 200%, a monthly premium may be established based
16 upon Federal requirements and in accordance with Federal
17 waivers, if applicable, by the commissioner.
18 (c) Other eligible adults.--An eligible adult whose
19 household income is greater than 200% but less than 300% of the
20 Federal poverty level may purchase under the program either the
21 benefit package under section 1313 or other qualifying health
22 care coverage at the per-member, per-month premium cost.
23 (d) Individuals.--An individual may purchase the benefit
24 package under section 1313 at the per-member, per-month premium
25 cost as long as the individual demonstrates, on an annual basis
26 and in a manner determined by the department, either one of the
27 following:
28 (1) The individual is unable to afford individual or
29 group coverage because that coverage would exceed 10% of the
30 individual's household income or because the total cost of
20080S1355B1941 - 11 -
1 coverage for the individual is 150% of the premium cost
2 established under this section for that service area.
3 (2) The individual has been refused coverage by an
4 insurer because the individual or a member of that
5 individual's immediate family has a preexisting condition and
6 coverage is not available to the individual.
7 (e) Establishing premiums.--For each fiscal year beginning
8 after June 30, 2009, the department may adjust the premium
9 amounts under subsection (b) to reflect changes in the cost of
10 medical services and shall forward notice of the new premium
11 amounts to the Legislative Reference Bureau for publication as a
12 notice in the Pennsylvania Bulletin.
13 (f) Purchase of health benefit plan.--An eligible adult's or
14 individual's payment to the department or its contractor under
15 subsection (b) shall be used to purchase the benefit health plan
16 established under section 1313 and must be remitted in a timely
17 manner.
18 (g) Subsidy.--Funding for the program shall be used by the
19 department to pay the difference between the total monthly cost
20 of the health benefit plan and the eligible adult's premium.
21 Subsidization of the health benefit plan is contingent upon the
22 amount of the funding for the program and is limited to eligible
23 adults in compliance with this section.
24 Section 1306. Participation by eligible employers and eligible
25 employees.
26 (a) Eligible employers.--An eligible employer that seeks to
27 participate in the program shall:
28 (1) Offer to all eligible employees the opportunity to
29 participate in the program and enroll at least one-half of
30 the eligible employees.
20080S1355B1941 - 12 -
1 (2) Comply with the application process established by
2 the department or its contractor.
3 (3) Remit to the department or its contractor any
4 premium amounts required under subsections (c) and (d).
5 (4) Allow health insurance premiums to be paid by
6 eligible employees on a pretax basis and inform its employees
7 of the availability of such program.
8 (5) Notify the department or its contractor of any
9 change in the eligible employee's income.
10 (b) Eligible employees.--An eligible employee who seeks to
11 participate with an eligible employer under the program must:
12 (1) Submit an application by an eligible employer to the
13 department or its contractor.
14 (2) Be responsible for any required copayments for
15 health care services rendered under the health benefit plan
16 in section 1313.
17 (c) Premiums for employers.--
18 (1) In addition to remitting the eligible employee
19 portion under subsections (a) and (d), an eligible employer
20 shall pay the employer share of the total monthly cost for
21 each participating employee to the department or its
22 contractor each month.
23 (2) In addition to remitting the eligible employee
24 portion under paragraph (1), an eligible employer's premium
25 payment to the department or its contractor shall be at least
26 50% of the total monthly cost for each eligible employee but
27 not less than $150.
28 (d) Premiums for eligible employees.--The premium for
29 eligible employees shall be the same as the premium required to
30 be paid by eligible adults under section 1305(b).
20080S1355B1941 - 13 -
1 (e) Purchase by certain eligible employees.--An eligible
2 employee whose household income is greater than 200% but less
3 than 300% of the Federal poverty level may purchase either the
4 benefit package under section 1313 or other qualifying health
5 care coverage under section 1307 at the per-member, per-month
6 premium cost minus any amount remitted by the employer under
7 subsection (c).
8 (f) Publishing premium amounts.--For each fiscal year
9 beginning after June 30, 2009, the department may establish
10 different premium amounts for eligible employees and eligible
11 employers as required under this section and shall forward
12 notice of the new premium amounts to the Legislative Reference
13 Bureau for publication as a notice in the Pennsylvania Bulletin.
14 (g) Purchase of coverage.--A premium payment made by an
15 eligible employer to the department or its contractor shall be
16 used to purchase the health benefit plan and must be remitted in
17 a timely manner.
18 (h) Alternative coverage.--
19 (1) Notwithstanding any other provision of law to the
20 contrary, employer-based coverage may, in the commissioner's
21 sole discretion, be purchased in place of participation in
22 the program or may be purchased in conjunction with any
23 portion of the program provided outside the scope of the
24 program contracts by the Commonwealth paying the employee's
25 share of the premium to the employer if it is more cost
26 effective for the Commonwealth to purchase health care
27 coverage from an employee's employer-based program than to
28 pay the Commonwealth's share of a subsidized premium.
29 (2) This section shall apply to any employer-based
30 program, whether individual or family, such that if the
20080S1355B1941 - 14 -
1 Commonwealth's share for the employee plus its share for any
2 spouse under the program or children under the children's
3 health insurance program is greater than the employee's
4 premium share for family coverage under the employer-based
5 program, the Commonwealth may choose to pay the latter alone
6 or in combination with providing any benefit the Commonwealth
7 does not provide through its program contracts.
8 (i) Termination of employment.--An eligible employee who is
9 terminated from employment shall be eligible to continue
10 participating in the program if the eligible employee continues
11 to meet the requirements as an eligible adult and pays any
12 increased premium required.
13 Section 1307. Health savings accounts.
14 The department shall approve the establishment of health
15 savings accounts that are actuarially equivalent to the benefits
16 in section 1313 for employees who enroll in the program. Health
17 savings accounts established under the program shall meet the
18 requirements as defined in section 223(d) of the Internal
19 Revenue Code of 1986 (Public Law 99-514, 26 U.S.C. § 223(d)).
20 Section 1308. (Reserved).
21 Section 1309. Program requirements.
22 (a) Rates.--Rates for the program shall be approved annually
23 by the department and may vary by region and contractor. Rates
24 shall be based on an actuarially sound and adequate review.
25 (b) Annual premiums review.--Premiums for the program shall
26 be established annually by the department.
27 (c) Use of funding.--Funding shall be used by the department
28 to pay the difference between the total monthly cost of the
29 health benefit plan and the premium payments by the eligible
30 employee, the eligible employer or the eligible adult.
20080S1355B1941 - 15 -
1 (d) Monthly increases.--With respect to a continuous period
2 of eligibility for an eligible employer to apply for
3 participation in the program and in addition to the requirements
4 of section 1306(d), an eligible employer shall be subject to a
5 1% increase in the base premium for each month after the latter
6 of the following:
7 (1) twelve months from the date of the effective date of
8 this section; or
9 (2) twelve months from the date the eligible employer
10 files for a Federal or State tax identification number.
11 (e) Funding contingency for subsidization.--Subsidization of
12 premiums paid under sections 1305 and 1306 is contingent upon
13 the amount of the funding available to the program, the Federal
14 poverty levels approved by the Federal waiver or State plan
15 amendments granted under section 1317 and is limited to eligible
16 adults and eligible employees who are in compliance with the
17 requirements under this chapter.
18 (f) Limit on subsidy.--At no time shall the subsidy paid by
19 the Commonwealth from funds other than Federal moneys for the
20 premium of eligible employees be more than 40% of the total cost
21 of the health benefit plan purchased in each region or with each
22 contractor.
23 Section 1310. Duties of department.
24 The department has the following duties:
25 (1) Administer the program on a Statewide basis.
26 (2) Solicit bids or proposals and award contracts as
27 follows:
28 (i) The department shall solicit bids or proposals
29 and award contracts for the benefit package under section
30 1313 through a competitive procurement process in
20080S1355B1941 - 16 -
1 accordance with 62 Pa.C.S. (relating to procurement) and
2 subsection (g). The department may award contracts on a
3 multiple-award basis as described in 62 Pa.C.S. § 517
4 (relating to multiple awards).
5 (ii) (A) In order to effectuate the program
6 promptly upon receipt of all applicable waivers and
7 approvals from the Federal Government, the department
8 may amend such contracts as currently exist to
9 provide benefits under either the program or the
10 Public Welfare Code, or may otherwise procure
11 services outside of the competitive procurement
12 process of 62 Pa.C.S.
13 (B) This subparagraph shall expire at such time
14 as there are effective contracts awarded under this
15 section in every county of this Commonwealth, but not
16 later than 18 months after the effective date of this
17 section.
18 (3) Subject to Federal requirements, impose reasonable
19 cost-sharing arrangements and encourage appropriate use by
20 contractors of cost-effective health care providers who will
21 provide quality health care by establishing and adjusting
22 copayments to be incorporated into the program by
23 contractors. The department shall forward changes of
24 copayments to the Legislative Reference Bureau for
25 publication as notices in the Pennsylvania Bulletin. The
26 changes shall be implemented by contractors as soon as
27 practicable following publication, but in no event more than
28 120 days following publication.
29 (4) In consultation with other appropriate Commonwealth
30 agencies, conduct monitoring and oversight of contracts
20080S1355B1941 - 17 -
1 entered into with contractors.
2 (5) In consultation with other appropriate Commonwealth
3 agencies, monitor, review and evaluate the adequacy,
4 accessibility and availability of services delivered to
5 eligible adults, individuals or eligible employees.
6 (6) In consultation with other appropriate Commonwealth
7 agencies, establish and coordinate the development,
8 implementation and supervision of an outreach plan to ensure
9 that all those who may be eligible are aware of the program.
10 The outreach plan shall include provisions for:
11 (i) Reaching special populations, including nonwhite
12 and non-English speaking individuals and individuals with
13 disabilities.
14 (ii) Reaching different geographic areas, including
15 rural and inner-city areas.
16 (iii) Assuring that special efforts are coordinated
17 within the overall outreach activities throughout this
18 Commonwealth.
19 (iv) Allowing for the acceptance of applications at
20 county assistance offices operated by the Department of
21 Public Welfare.
22 (7) At the request of an eligible adult, individual,
23 eligible employee or eligible employer, facilitate the
24 payment on a pretax basis of premiums:
25 (i) for the program and dependents covered under the
26 program; or
27 (ii) if applicable, for the children's health
28 insurance program.
29 (8) Establish penalties for eligible adults,
30 individuals, eligible employees or eligible employers who
20080S1355B1941 - 18 -
1 enroll in the program, drop enrollment and subsequently re-
2 enroll for the purpose of avoiding the ongoing payment of
3 premiums. The commissioner shall forward notice of these
4 penalties to the Legislative Reference Bureau for publication
5 as a notice in the Pennsylvania Bulletin.
6 (9) Coordinate with the Department of Public Welfare in
7 the implementation of this chapter and may designate the
8 Department of Public Welfare to perform any duties that are
9 appropriate under this chapter.
10 Section 1311. Submission of proposals and award of contracts.
11 (a) Corporations required to submit.--Each professional
12 health services plan corporation and hospital plan corporation
13 and their subsidiaries and affiliates doing business in this
14 Commonwealth shall submit a bid or proposal to the department to
15 carry out the purposes of this section in the geographic area
16 serviced by the corporation. All other insurers may submit a bid
17 or proposal to the department to carry out the purposes of this
18 section.
19 (b) Review and scoring of bids or proposals.--The department
20 shall review and score the bids or proposals on the basis of all
21 the requirements for the program. The department may include
22 other criteria in the solicitation and in the scoring and
23 selection of the bids or proposals that the department, in the
24 exercise of its duties under section 1310, deems necessary. The
25 department shall do all of the following:
26 (1) Select, to the greatest extent practicable, offerors
27 that contract with health care providers to provide health
28 care services on a cost-effective basis. The department shall
29 select offerors that use appropriate cost-management methods,
30 including the chronic care and prevention measures, which
20080S1355B1941 - 19 -
1 will enable the program to provide coverage to the maximum
2 number of enrollees.
3 (2) Select, to the greatest extent practicable, only
4 offerors that comply with all procedures relating to
5 coordination of benefits as required by the department and
6 the Department of Public Welfare.
7 (c) Contract terms.--Contracts may be for an initial term of
8 up to five years, with options to extend for five one-year
9 periods.
10 (d) Duties of contractors.--A contractor that contracts with
11 the department to provide a health benefit plan to eligible
12 adults or eligible employees:
13 (1) Shall process claims for the coverage.
14 (2) Shall reimburse providers at a reimbursement rate
15 of:
16 (i) (A) not less than 105% of the Federal Medicare
17 reimbursement rate for the service provided by a
18 provider under section 1104(B)(1);
19 (B) not less than 90% of the Federal Medicare
20 reimbursement rate for the service provided by a
21 provider under section 1104(B)(2); or
22 (ii) (A) at a rate of 90% of the Medicaid
23 reimbursement rate for an inpatient service; and
24 (B) at a rate of 100% of the Medicaid
25 reimbursement rate for a service that does not have a
26 Medicare reimbursement rate, except as provided in
27 section 1213(b).
28 (3) May not deny coverage to an eligible adult or
29 eligible employee who has been approved by the department to
30 participate in the program.
20080S1355B1941 - 20 -
1 Section 1312. Rates and charges.
2 (a) Medical loss ratio.--The medical loss ratio for a
3 contract shall be not less than 85%.
4 (b) Limitation on fees.--No eligible adult or eligible
5 employee shall be charged a fee, other than those specified in
6 this chapter, as a requirement for participating in the program.
7 Section 1313. Health benefit plan.
8 (a) Benefits.--The health benefit plan to be offered under
9 the program shall be of the scope and duration as the department
10 determines and shall provide for all of the following, which may
11 be as limited or unlimited as the department may determine:
12 (1) Preliminary and annual health assessments.
13 (2) Emergency care.
14 (3) Inpatient and outpatient care.
15 (4) Prescription drugs, medical supplies and equipment.
16 (5) Emergency dental care.
17 (6) Maternity care.
18 (7) Skilled nursing.
19 (8) Home health and hospice care.
20 (9) Chronic disease management.
21 (10) Preventive and wellness care.
22 (11) Inpatient and outpatient behavioral health
23 services.
24 (b) Commonwealth election.--The Commonwealth may elect to
25 provide any benefit independently and outside the scope of the
26 program contracts.
27 (c) Enrollment.--Enrollment in the program may not be
28 prohibited based upon a preexisting condition, nor may a program
29 health benefit plan exclude a diagnosis or treatment for a
30 condition based upon its preexistence.
20080S1355B1941 - 21 -
1 (d) Copayments.--The department may establish a copayment
2 for any of the services provided in the health benefit plan as
3 long as the copayment meets any Federal requirements under
4 section 1317. The department shall forward notice of the
5 copayment amounts to the Legislative Reference Bureau for
6 publication as a notice in the Pennsylvania Bulletin.
7 Section 1314. Data matching.
8 (a) Covered individuals.--All entities providing health
9 insurance or health care coverage within this Commonwealth
10 shall, not less frequently than once every month, provide the
11 names, identifying information and any additional information on
12 coverage and benefits as the department may specify for all
13 eligible adults, individuals or eligible employees for whom the
14 entities provide insurance or coverage.
15 (b) Use of information.--
16 (1) The department shall use information obtained in
17 subsection (a) to determine whether any portion of an
18 eligible adult's, individual's, eligible employee's or
19 eligible employer's premium is being paid from any other
20 source and to determine whether another entity has primary
21 liability for any health care claims paid under any program
22 administered by the department.
23 (2) If a determination is made that an eligible adult's,
24 individual's, eligible employee's or eligible employer's
25 premium is being paid from another source, the department may
26 not make any additional payments to the insurer for the
27 eligible adult, individual, eligible employee or eligible
28 employer.
29 (c) Excess payment.--If a payment has been made to an
30 insurer by the department for an eligible adult, individual,
20080S1355B1941 - 22 -
1 eligible employee or eligible employer for whom any portion of
2 the premium paid by the department is being paid from another
3 source, the insurer shall reimburse the department the amount of
4 any excess payment or payments.
5 (d) Reimbursement.--The department may seek reimbursement
6 from an entity that provides health insurance or health care
7 coverage that is primary to the coverage provided under any
8 program administered by the department.
9 (e) Timeliness.--To the maximum extent permitted by law and
10 notwithstanding any policy or plan provision to the contrary, a
11 claim by the department for reimbursement under subsection (c)
12 or (d) shall be deemed timely filed if it is filed with the
13 insurer or entity within three years following the date of
14 payment.
15 (f) Agreements.--The department may enter into agreements
16 with entities that provide health insurance and health care
17 coverage for the purpose of carrying out the provisions of this
18 section. The agreements shall provide for the electronic
19 exchange of data between the parties at a mutually agreed upon
20 frequency, but not less than monthly, and may also allow for
21 payment of a fee by the department to the entity providing
22 health insurance or health care coverage.
23 (g) Other coverage.--
24 (1) The department shall determine whether any other
25 health care coverage is available to an eligible adult,
26 eligible employee or eligible employer through an alimony
27 agreement or an employment-related or other group basis.
28 (2) If other health care coverage is available, the
29 department shall reevaluate the enrollee's eligibility under
30 this chapter.
20080S1355B1941 - 23 -
1 (h) Penalty.--
2 (1) The department may impose a penalty of up to $1,000
3 per violation on any insurer that fails to comply with the
4 obligations imposed by this chapter.
5 (2) All moneys collected under this subsection shall be
6 deposited into the fund.
7 Section 1315. Entitlements and claims.
8 Nothing in this chapter shall be construed as an entitlement
9 derived from the Commonwealth or a claim on any funds of the
10 Commonwealth. The Department of Public Welfare, in conjunction
11 with the department, shall establish a waiting list and State
12 plan amendments and revisions to Federal waivers as are
13 necessary to ensure that expenditures in the program do not
14 exceed available funding.
15 Section 1316. Regulations.
16 The department may promulgate regulations for the
17 implementation and administration of this chapter.
18 Section 1317. Federal waivers.
19 (1) The Department of Public Welfare, in cooperation
20 with the department, shall apply for all applicable waivers
21 from the Federal Government and shall seek approval to amend
22 the State plan as necessary to carry out the provisions of
23 this chapter.
24 (2) If the Department of Public Welfare receives
25 approval of a waiver or approval of a State plan amendment as
26 required by this section, it shall notify the department and
27 transmit notice of the waiver or State plan amendment
28 approvals to the Legislative Reference Bureau for publication
29 as a notice in the Pennsylvania Bulletin.
30 (3) The department may change the benefits under section
20080S1355B1941 - 24 -
1 1313 and the premium and copayment amounts payable under
2 sections 1305 and 1306 and eligibility requirements in order
3 for the program to meet Federal requirements.
4 Section 1318. Federal funds.
5 Notwithstanding any other provision of law, the Department of
6 Public Welfare, in cooperation with the department, shall take
7 any action necessary to do all of the following:
8 (1) Ensure the receipt of Federal financial
9 participation under Title XIX of the Social Security Act (49
10 Stat. 620, 42 U.S.C. § 1396 et seq.) for coverage and for
11 services provided under this chapter.
12 (2) Qualify for available Federal financial
13 participation under Title XIX of the Social Security Act.
14 Section 3. The Insurance Department shall publish a notice
15 in the Pennsylvania Bulletin when a law is enacted that provides
16 for or designates at least $120,000,000 for the Supplemental
17 Assistance and Funding Account.
18 Section 4. Repeals are as follows:
19 (1) The General Assembly declares that the repeal under
20 paragraph (2) is necessary to effectuate this act.
21 (2) Chapter 13 of the act of June 26, 2001 (P.L.755,
22 No.77), known as the Tobacco Settlement Act.
23 (3) All other acts and parts of acts are repealed
24 insofar as they are inconsistent with this act.
25 Section 5. This act shall take effect as follows:
26 (1) Section 3 of this act shall take effect July 1,
27 2008, or immediately, whichever is later.
28 (2) The remainder of this act shall take effect upon
29 publication of the notice specified under section 3 of this
30 act.
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