PRINTER'S NO. 807
THE GENERAL ASSEMBLY OF PENNSYLVANIA
HOUSE BILL
No.
693
Session of
2015
INTRODUCED BY MICCARELLI, COHEN, HELM, BARRAR AND MURT,
MARCH 3, 2015
REFERRED TO COMMITTEE ON INSURANCE, MARCH 3, 2015
AN ACT
Providing for contracts of physicians, physician groups and
physician organizations with health insurers.
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 Fair Health
Care Provider Contracting Act.
Section 2. 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:
"Capitation." The payment by a health insurer to physicians,
physician groups or physician organizations of a per-member-per-
month amount, such as percentage of premium, by which a health
insurer transfers to the physicians, physician groups or
physician organizations the financial risk for those covered
services as set forth in the contract between the health insurer
and the physicians, physician groups or physician organizations.
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"CCI." The Centers for Medicare and Medicaid Services'
published list of edits and adjustments that are made to health
care providers' claims submitted for services or supplies
provided to patients insured under the Medicare program and
under other Federal insurance programs.
"Clean claim." A claim for payment for a covered service
that has no defect or impropriety. The term does not include a
claim from a physician who is under investigation for fraud or
abuse regarding that claim.
"Clinical information." Clinical, operative or other medical
records and reports maintained in the ordinary course of a
physician's, physician group's or physician organization's
business. The term shall include, where applicable, requested
statements of medical necessity.
"CMS-1500." The current health care provider claim form
created by the Centers for Medicare and Medicaid Services.
"Covered services." With respect to a particular health
insurer, a health care benefit that is within the coverage
described in the plan documents applicable to an eligible plan
member of the health insurer.
"CPT." Current Procedural Terminology.
"CPT codes." Current medical nomenclature in the
publications entitled "CPT Standard Edition," "CPT Professional
Edition," "CPT Assistant" and "Principles of CPT Coding" that
are published by the American Medical Association and contain a
systematic listing and coding of procedures and services
provided to patients by physicians and certain nonphysician
health professionals.
"CPT conventions." Rules for the application of codes to the
entire contents of the American Medical Association CPT book.
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"CPT guidelines." Guidelines set forth in the introduction,
beginning of each major section, subsections and code level
parenthetic statements and cross references contained in the
American Medical Association publication "CPT, Professional
Edition." The term shall not include any reference to a
publication that is not subject to the existing CPT Editorial
Panel process, such as "CPT Assistant" or "Principles of CPT
Coding."
"Edit." A practice or procedure pursuant to which one or
more adjustments are made to CPT codes or HCPCS Level II codes
included in a claim that results in one or more of the
following:
(1) Payment being made based on some, but not all, of
the CPT codes or HCPCS Level II codes included in the claim.
(2) Payment being made based on different CPT codes or
HCPCS Level II codes than those included in the claim.
(3) Payment for one or more of the CPT codes or HCPCS
Level II codes included in the claim being reduced by
application of multiple procedure logic.
(4) Payment for one or more of the CPT codes or HCPCS
Level II codes being denied.
"ERISA." The Employee Retirement Income Security Act of 1974
(Public Law 93-406, 88 Stat. 829) and the rules and regulations
promulgated thereunder.
"Fully insured plan." A plan under which a health insurer
assumes all or a majority of health care cost and utilization
risk.
"HCPCS Level II codes." Healthcare Common Procedure Coding
System Level II Codes, which are alphanumeric codes used to
identify codes not included in CPT.
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"Health insurer." An entity and its health subsidiaries and
affiliates licensed under:
(1) 40 Pa.C.S. Ch. 61 (relating to hospital plan
corporations); or
(2) 40 Pa.C.S. Ch. 63 (relating to professional health
services plan corporations).
"HIPAA." The Health Insurance Portability and Accountability
Act of 1996 (Public Law 104-191, 110 Stat. 136).
"Individually negotiated contract." A contract pursuant to
which the parties to the contract, as a result of negotiation,
agree to one or more modifications to the terms of a health
insurer's applicable standard form agreement that:
(1) Substantially modify the standard form agreement.
(2) Are made to individually suit, in whole or in part,
the needs of a participating physician, participating
physician group or participating physician organization, such
as higher or customized rates and other customized payment
methodologies.
"Most favored nation clause." A clause within a health care
provider contract that places an obligation on a participating
physician, participating physician group or participating
physician organization to grant to a health insurer contract
terms and conditions that are identical to every other contract
negotiated by the participating physician, participating
physician group or participating physician organization with
another health insurer or third-party payor entity, including
more advantageous terms for the participating physician,
participating physician group or participating physician
organization.
"Nonparticipating physician." A physician, physician group
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or physician organization that is not a participating physician,
participating physician group or participating physician
organization.
"Overpayment." With respect to a claim submitted by or on
behalf of a physician, physician group or physician
organization, any erroneous or excess payment that a health
insurer makes for any reason, including the following:
(1) Payment at an incorrect rate.
(2) Duplicate payments for the same physician service.
(3) Payment with respect to an individual who was not a
plan member on the date the physician provided the physician
services that are the subject of the payment.
(4) Payment for any noncovered service.
"Participating physician." A physician who has entered into
a valid written contract with a health insurer, or who has
agreed pursuant to an arrangement with a physician group,
physician organization or other entity which has a valid written
contract with a health insurer, to provide covered services to
that health insurer's plan members and, where applicable, who
meets the health insurer's credentialing requirements during the
effective period of the contract. The term does not include a
physician who has entered into an agreement with a rental
network.
"Participating physician group." A physician group that has
entered into a valid written contract with a health insurer to
provide covered services to that health insurer's plan members.
"Participating physician organization." A physician
organization that has entered into a valid written contract with
a health insurer to provide covered services to the health
insurer's plan members.
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"Physician." As defined in 1 Pa.C.S. § 1991 (relating to
definitions).
"Physician group." Two or more physicians, and those
claiming by or through them, who practice under a single
taxpayer identification number.
"Physician organization." An association, partnership,
corporation or other form of organization, such as independent
practice associations and physician hospital organizations, that
arranges for care to be provided to plan members by physicians
organized under multiple taxpayer identification numbers.
"Physician services." Covered services that a physician
provides to a plan member, as specified in applicable agreements
with a health insurer or otherwise.
"Physician specialty society." A United States medical
specialty society that represents diplomats certified by a board
recognized by the American Board of Medical Specialties.
"Plan." A benefit plan through which a plan member obtains
health care benefits set forth in pertinent plan documents.
"Plan documents." Documents defining the health care
benefits available to a plan member, including the plan member's
summary plan description, certificate of coverage or other
applicable coverage documents and the terms and conditions under
which the benefits are available under the plan.
"Plan member." An individual enrolled in or covered by a
plan offered and administered by a health insurer.
"Precertification." The prior approval by a health insurer
that a service or supply is medically necessary and not
experimental or investigational.
"Product network." A network of participating physicians
who, pursuant to contracts with a health insurer, provide
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covered services to plan members for one or more products or
types of products offered by the health insurer in exchange for
a specified type of compensation.
"Provider website." The secure and password-protected online
resources for participating physicians to obtain information
about a health insurer, its products and policies and other
information.
"Public website." The online resources for the public to
obtain information about a health insurer, its products and
policies and other information.
"Self-insured plan." Any plan other than a fully insured
plan.
"Significant edit." An edit that a health insurer reasonably
believes, based on its experience with submitted claims, shall
cause, on the initial review of submitted claims, the denial of
or reduction in payment for a particular CPT code or HCPCS Level
II code more than 250 times per year.
Section 3. Availability of fee schedules and scheduled payment
dates.
The following shall apply:
(1) A health insurer shall develop and implement a plan
to reasonably permit its participating physicians,
participating physician groups and participating physician
organizations to access complete fee information with the
applicable fee schedule amounts for a particular
participating physician, participating physician group or
participating physician organization pursuant to the
participating physician's, participating physician group's or
participating physician organization's direct written
agreement with the health insurer. Access must be provided on
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a confidential basis.
(2) A participating physician, participating physician
group or participating physician organization may elect to
view the fee schedule in an electronic, printed or CD-ROM
format.
(3) The fee schedule information shall be provided by
the fee-for-service dollar amount allowable for each CPT code
for those CPT codes that a participating physician,
participating physician group or participating physician
organization in the same specialty typically uses in
providing covered services.
(4) A participating physician, participating physician
group or participating physician organization may request and
the health insurer shall provide the fee-for-service dollar
amount allowable for other CPT codes that its participating
physician, participating physician group or participating
physician organization bills the health insurer.
(5) A health insurer may base actual compensation on the
health insurer's maximum allowable amount and other contract
adjustments.
(6) A health insurer, upon written request from a
participating physician, participating physician group or
participating physician organization that, in each case, has
entered into a written contract directly with the health
insurer shall provide a printed fee schedule for up to 100
CPT codes customarily and routinely used by the participating
physician, participating physician group or participating
physician organization, as specified by the participating
physician, participating physician group or participating
physician organization.
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(7) A health insurer is obligated to provide no more
than two requests under paragraph (6) annually.
(8) A health insurer may not require its participating
physicians, participating physician groups or participating
physician organizations to provide the health insurer with
billing rates as a precondition to the health insurer
providing fee information under this section.
Section 4. Reduced precertification requirements.
(a) Posting.--Except as provided under subsection (b), a
health insurer shall post on its provider website those services
or supplies for which precertification is routinely required and
shall update the posting to reflect changes in precertification
requirements.
(b) Specification of services.--Notwithstanding subsection
(a), a health insurer's self-insured plan customers may specify
services or supplies for which precertification is required that
differ from or are in addition to the services or supplies for
which the health insurer routinely requires precertification for
its fully insured plans. A self-insured plan may contract with a
different entity to provide precertification services.
(c) Utilization.--A health insurer shall propose to its
self-insured plan customers that they utilize the health
insurer's standard list of services and supplies for which
precertification is required.
(d) Customized list.--With a self-insured plan's approval, a
health insurer shall post the self-insured plan's customized
list of precertification requirements on its provider website.
Section 5. Notice of policy and procedure changes.
(a) Written notice.--If a health insurer intends to make any
material adverse changes to the terms of its contracts,
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including policies and procedures, the health insurer shall
provide at least 90 days' written notice to each affected
participating physician, participating physician group or
participating physician organization with whom the health
insurer has directly contracted, unless a shorter notice period
is required by law. The written notice shall reasonably inform
its participating physician, participating physician group or
participating physician organization of the changes and that the
changes shall not become effective before the conclusion of the
notice period.
(b) Termination.--If a participating physician,
participating physician group or participating physician
organization objects to the changes that are subject to the
notice, the participating physician, participating physician
group or participating physician organization must, within 30
days of the date of the notice, provide written notice to
terminate the contract with the health insurer. The termination
shall take effect at the conclusion of the notice period unless,
within 65 days of the date of the original notice, the health
insurer provides written notice to the objecting participating
physician, participating physician group or participating
physician organization that it shall not implement the changes
to which the physician, physician group or physician
organization objects.
(c) Notice date.--The date of notice required under
subsection (b) shall be the date the notice is sent by United
States mail, by facsimile, or if the health insurer offers it,
electronically at the option of the physician, physician group
or physician organization.
Section 6. Disclosure of claims payment practices.
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(a) Payment rules.--A health insurer shall consistently
apply, in all material respects, its automated bundling and
other claims payment rules for claims submitted by or on behalf
of the health insurer's plan members. This subsection does not
apply to claims payment under Medicaid, State Children's Health
Insurance Program and other similar government programs for low-
income persons and for members of State-established high risk
pools.
(b) Disclosure.--Within 30 days of the effective date of
this section, a health insurer shall disclose its significant
edits on its provider website.
(c) Update.--A health insurer shall update its disclosure of
significant edits once each calendar year to reflect changes in
the health insurer's significant edits and the health insurer's
experience with submitted claims. The health insurer shall
promptly disclose newly adopted significant edits. The following
shall apply:
(1) Within 30 days of the effective date of this
section, a health insurer shall publish on its provider
website, for each commercially available claims editing
software product being used by the health insurer, a list
identifying each customized edit added to the standard claims
editing software product at the health insurer's request.
(2) Within 30 days of the effective date of this
section, a health insurer may not routinely require
submission of clinical information, before or after payment
of claims, in connection with the health insurer's
adjudication of a physician's claims for payment, except for
the following:
(i) Claims for unlisted codes.
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(ii) Claims to which a CPT modifier 22 is appended.
(iii) Other limited categories of claims which the
health insurer determines are appropriate for routine
review. The health insurer shall disclose these
categories on its public website and provider website.
(d) Required submission.--Notwithstanding subsection (c)(2),
a health insurer may require submission of clinical information
in connection with a health insurer's adjudication of a
physician's claims for payment for the purpose of investigating
intentional or unintentional fraudulent or abusive billing
practices, but only when the health insurer has a reasonable
belief that the investigation is warranted.
(e) Contest.--A participating physician may contest any
requirement that the participating physician submit clinical
information in connection with a health insurer's adjudication
of the participating physician's claims for payment for the
purpose of investigating intentional or unintentional fraudulent
or abusive billing practices.
(f) Intent.--Nothing under this section shall be construed
to limit a health insurer's right to require submission of
clinical information when the requirement is not in connection
with a health insurer's adjudication of a physician's claims for
payment or is otherwise permitted by this section, such as the
right to require submission of clinical information for
precertification purposes as consistent with this section.
(g) Publication.--Within 30 days of the effective date of
this section, a health insurer shall publish on its provider
website the limited code combinations for particular services or
procedures, relative to CPT modifiers 25 and 59, which it has
determined are not appropriately reported together. The health
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insurer shall explain how its application of the rule differs
from CPT codes, except that no determination shall be
inconsistent with this section.
Section 7. Dispute resolution.
(a) Establishment.--Within 30 days of the effective date of
this section, a health insurer shall establish a billing dispute
external review process. The billing dispute external review
process shall provide for a billing dispute reviewer to resolve
disputes with physicians and physician groups arising from
covered services provided to the health insurer's plan members
by the physicians and physician groups either of the following:
(1) The health insurer's application of the health
insurer's coding and payment rules and methodologies for fee-
for-service claims, including, but not limited to, any
bundling, downcoding, application of a CPT modifier and other
reassignment of a code by the health insurer, to patient-
specific factual situations, including, but not limited to,
the appropriate payment when two or more CPT codes are billed
together or whether a payment-enhancing modifier is
appropriate.
(2) Any retained claim, if the retained claim is
submitted by the physician to the billing dispute reviewer
within 90 days after the effective date of this section or 30
days after exhaustion of the health insurer's internal
appeals process, whichever is later. Each matter shall be a
separate billing dispute.
(b) Jurisdiction.--The billing dispute reviewer does not
have jurisdiction over any other dispute that falls outside the
scope of the external review process set forth under subsection
(a), including compliance disputes and disputes concerning the
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scope of covered services. The billing dispute reviewer does not
have jurisdiction or authority to revise or establish any
reimbursement policy of the health insurer.
(c) Intent.--Nothing contained under this section shall be
construed to supersede, alter or limit the rights or remedies
otherwise available to any plan member under section 502(a) of
ERISA or to supersede in any respect the claims procedures for
plan members under section 503 of ERISA, or required by
applicable Federal or State law or regulation.
(d) Appeal process.--
(1) The physician or physician group must exhaust the
health insurer's internal appeals process before submitting a
billing dispute to the billing dispute reviewer.
(2) A physician or physician group shall be deemed to
have exhausted the health insurer's internal appeals process
if the health insurer does not communicate a decision on an
internal appeal within 30 days of the health insurer's
receipt of all documentation reasonably needed to decide the
internal appeal. If the health insurer and physician or
physician group disagree as to whether the requirements of
this paragraph have been satisfied, the disagreement shall be
resolved by the billing dispute reviewer.
(e) Time.--Billing disputes shall be submitted to the
billing dispute reviewer no more than 90 days after a physician
or physician group exhausts the health insurer's internal
appeals process. A billing dispute reviewer shall not hear or
decide any billing dispute submitted more than 90 days after the
health insurer's internal appeals process has been exhausted.
(f) Documentation.--A health insurer shall supply
appropriate documentation to the billing dispute reviewer no
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later than 30 days after requested by the billing dispute
reviewer, which request shall not be made until billing disputes
have been submitted with amounts in dispute that in aggregate
exceed $500.
(g) Cooperation.--A health insurer shall cooperate with
organized physician organizations in this Commonwealth to select
the person to serve as the billing dispute reviewer on a local
or regional basis.
Section 8. All products clauses prohibition.
(a) Capitated fee arrangement.--No health insurer may
require a participating physician to participate in a capitated
fee arrangement in order to participate in product networks in
which the participating physician is compensated on a fee-for-
service basis.
(b) Product networks.--No health insurer may require a
participating physician to participate in its Medicare Advantage
or Medicaid product networks in order to participate in its
commercial product networks.
(c) Participation.--If a participating physician,
participating physician group or participating physician
organization chooses not to participate in all of the health
insurer's product networks or terminates participation in some
of the health insurer's product networks, the reimbursement
levels offered to or applied by the health insurer to the
participating physician, participating physician group or
participating physician organization for the product network in
which the participating physician, participating physician group
or participating physician organization continues to participate
shall not be lower than the health insurer's standard
reimbursement levels in the geographic market. This subsection
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shall not apply if a participating physician, participating
physician group or participating physician organization has
agreed in an individually negotiated contract to participate in
more than one product network for a specified period of time, in
which case the terms of the individually negotiated contract
shall govern.
(d) Reimbursement level or incentive.--Notwithstanding
subsection (c), the health insurer may offer a higher
reimbursement level or other incentive to any participating
physician, participating physician group or participating
physician organization that elects to participate or elects to
continue participation in more than one of the health insurer's
product networks.
(e) Obligation.--Nothing under this section shall obligate a
health insurer to pay more than the lesser of the participating
physician's billed charges or the health insurer's applicable
fee-for-service amount.
Section 9. Termination without cause.
(a) Written notice.--Unless an individually negotiated
contract between a health insurer and a participating physician,
participating physician group or participating physician
organization specifies a different period of notice, or
specifies that the contract may not be terminated except for
cause during a defined period of time, a party to a contract
between a health insurer and a participating physician,
participating physician group or participating physician
organization may terminate the contract without cause upon prior
written notice provided to the other party. The notice shall be
a definite period set forth in the agreement, which period shall
be no less than 60 days or more than 120 days.
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(b) Obligations.--In the event of a contract termination by
either party, the following obligations shall apply with respect
to the continuation of care for those patients of a
participating physician, participating physician group or
participating physician organization who are entitled to
continuation of care as reasonably defined under the
participating physician's, participating physician group's or
participating physician organization's contract with the health
insurer or under applicable law:
(1) The participating physician, participating physician
group or participating physician organization shall continue
to render necessary care to the health insurer's plan member
consistent with contractual or legal obligations. Following
notice by the participating physician, participating
physician group, participating physician organization or the
health insurer's plan member, if the health insurer does not
use due diligence to make alternative care available to the
affected plan member within 90 days after receipt of the
notice, the health insurer shall pay to the participating
physician, participating physician group or participating
physician organization the standard rates paid to
nonparticipating physicians for the applicable geographical
area.
(2) Notwithstanding paragraph (1), a health insurer's
obligations under this section shall not apply to the extent
that other participating physicians, participating physician
groups or participating physician organizations are not
available to replace the terminated physician, physician
group or physician organization due to:
(i) geographic or travel-time barriers; or
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(ii) contractual provisions between the terminating
physician, physician group or physician organization and
a facility at which the health insurer's plan member
receives care that limits or precludes other
participating physicians, participating physician groups
or participating physician organizations from rendering
replacement services to the health insurer's plan
members.
Section 10. Clinical judgment.
(a) Adoption.--A health insurer shall adopt and apply to its
agreements with participating physicians the definition of
"medically necessary" or a comparable term. The term shall mean
health care services that a physician, exercising prudent
clinical judgment, would provide to a patient for the purpose of
preventing, evaluating, diagnosing or treating an illness,
injury, disease or its symptoms, and that are:
(1) in accordance with generally accepted standards of
medical practice;
(2) clinically appropriate, in terms of type, frequency,
extent, site and duration, and considered effective for the
patient's illness, injury or disease; and
(3) not primarily for the convenience of the patient,
physician or other health care provider and are not more
costly than an alternative service or sequence of services at
least as likely to produce equivalent therapeutic or
diagnostic results relative to the diagnosis or treatment of
that patient's illness, injury or disease.
(b) Definition.--As used in this section, the term
"generally accepted standards of medical practice" means
standards that are based on credible scientific evidence
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published in peer-reviewed medical literature generally
recognized by the relevant medical community, physician
specialty society recommendations and the views of physicians
practicing in relevant clinical areas and any other relevant
factors.
Section 11. Medical policies.
In formulating and adopting medical policies with respect to
covered services, a health insurer shall rely on credible
scientific evidence published in peer-reviewed medical
literature generally recognized by the relevant medical
community and shall continue to make the policies readily
available to its plan members and participating physicians via
its public website or by other electronic means. In formulating
and adopting the policies, a health insurer shall take into
account national physician specialty society recommendations and
the views of prudent physicians practicing in relevant clinical
areas and any other clinically relevant factors.
Section 12. Administrative exemption program.
(a) Exemption.--A health insurer shall consider the
feasibility and desirability of exempting selected participating
physicians from certain administrative requirements based on
criteria such as the participating physician's delivery of
quality and cost-effective medical care and accuracy and
appropriateness of claims submissions.
(b) Construction.--No health insurer shall be obligated to
implement any exemption. This section shall not be construed to
limit a health insurer's ability to:
(1) implement a program on a pilot or experimental
basis;
(2) base exemptions on any health-insurer-determined
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basis; or
(3) otherwise implement one or more programs in select
markets.
Section 13. Clean claims.
A health insurer shall direct the issuance of a check or
electronic funds transfer in payment for clean claims for
covered services within 30 days of the date of service.
Section 14. Evaluation and management claims.
(a) Prohibition.--No health insurer shall automatically
reassign or reduce the code level of evaluation and management
codes billed for covered services, also known as downcoding,
except that a health insurer may reassign a new patient visit
code to an established patient visit code based solely on CPT
codes, CPT guidelines and CPT conventions.
(b) Denial.--A health insurer shall:
(1) Continue to have the right to deny, pend or adjust
the claims for covered services on other bases.
(2) Have the right to reassign or reduce the code level
for selected claims for covered services or claims for
covered services submitted by selected physicians, physician
groups or physician organizations, based on:
(i) A review of the clinical information at the time
the service was rendered for the particular claims.
(ii) A review of information derived from a health
insurer's fraud or abuse billing detection programs that
create a reasonable belief of intentional or
unintentional fraudulent or abusive billing practices,
provided that the decision to reassign or reduce is based
primarily on a review of clinical information.
Section 15. Claim editing.
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(a) Duties.--A health insurer shall do all of the following:
(1) Take actions necessary to cause claim-editing
software to produce editing results consistent with the
standards set forth in this section.
(2) Process and separately reimburse those codes listed
in the American Medical Association CPT book as modifier 51
exempt CPT codes without reducing payment under the health
insurer's multiple procedure logic if the American Medical
Association CPT book provides that the services are
appropriately reported together.
(3) Process and separately reimburse codes listed in the
American Medical Association CPT book as add-on billing codes
without reducing payment under the health insurer's multiple
procedure logic, if the American Medical Association CPT book
provides that the add-on CPT codes are appropriately billed
with proper primary procedure codes.
(b) Clinical information.--No health insurer shall require a
physician to submit clinical information of a physician's
patient encounters solely because the physician seeks payment
for both surgical procedures and CPT evaluation and management
services for the same patient on the same date of service, if
the correct CPT evaluation and management code, surgical code
and modifier are included on the initial claim submission.
(c) Code recognition.--If a claim contains a CPT code for an
evaluation and management service, appended with a CPT modifier
25 and a CPT code for performance of a nonevaluation and
management service procedure code, both codes shall be
recognized and separately eligible for payment, unless the
clinical information indicates that use of the CPT modifier 25
was inappropriate, pursuant to the limited number of finite code
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combinations that are not appropriately reported together.
(d) Payment.--Payment shall only be made for one evaluation
and management service for any single day unless payment for
more than one is appropriate pursuant to the American Medical
Association CPT book and is supported by appropriate diagnoses
in the clinical information.
(e) Edits.--A health insurer shall remove from its claim
review and payment systems any edits that generally deny payment
for CPT evaluation and management codes with a CPT modifier 25
appended when submitted with surgical or other procedure codes
for the same patient on the same date of service except for a
limited number of exceptions, which shall be disclosed on the
health insurer's provider website.
(f) Prohibition.--Nothing in this section shall prohibit a
health insurer from requiring use of the appropriate CPT code
modifiers for evaluation and management billing codes on the
original claim forms or preclude a health insurer from requiring
a physician, physician group or physician organization to submit
to an audit of claims submitted by the physician, physician
group or physician organization for payment directly to the
physician, physician group or physician organization, such as
claims for surgical procedures and evaluation and management
services on the same date of service submitted with the
appropriate modifier, and to provide their clinical information
in connection with an audit.
(g) Supervision code.--A CPT code for supervision and
interpretation or radiologic guidance shall be separately
recognized and eligible for payment to the extent that the
associated procedure code is recognized and eligible for payment
if:
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(1) the associated procedure code does not include
supervision and interpretation or radiologic guidance
according to the American Medical Association CPT book; and
(2) for each procedure, no health insurer shall be
required to pay for supervision or interpretation or
radiologic guidance by more than one qualified health care
professional.
(h) Reassignment.--No health insurer shall reassign any CPT
code into any other CPT code or deem a CPT code ineligible for
payment based solely on the format of the published CPT
descriptions.
(i) Modifier 59 codes.--A CPT code submitted with a modifier
59 attached shall be eligible for payment if the code follows
the American Medical Association CPT book and it designates a
distinct or independent procedure performed on the same day by
the same physician, but only if:
(1) the procedures or services are appropriately
reported together under the particular presenting
circumstances; and
(2) it would not be more appropriate to append any other
CPT-recognized modifier to the CPT code.
(j) Global periods.--No global periods for surgical
procedures shall be longer than the period designated by Centers
for Medicare and Medicaid Services, except that this limitation
shall not restrict a health insurer from establishing a global
period for surgical procedures, unless the Centers for Medicare
and Medicaid Services has determined a global period is not
appropriate or has identified a global period not associated
with a specific number of days.
(k) Automatic change.--No health insurer shall automatically
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change a CPT code to a code reflecting a reduced intensity of
the service if the CPT code is among or across a series that
includes, without limitation, CPT codes that differentiate among
simple, intermediate and complex, complete or limited, and size.
Section 16. Overpayment recovery procedures.
(a) Time limit.--Except as provided under subsection (b), no
health insurer shall initiate overpayment recovery efforts more
than 18 months after the payment was received by the physician,
except that no time limit shall apply to the initiation of
overpayment recovery efforts:
(1) based on a reasonable belief of fraud or other
intentional misconduct;
(2) required by a self-insured plan; or
(3) required by a Federal or State program.
(b) Underpayment.--Notwithstanding subsection (a), if a
physician asserts a claim of underpayment, a health insurer may
defend or set off a claim based on overpayments since the
claimed underpayment.
(c) Appeal.--If a physician requests an appeal within 30
days of receipt of a request for repayment of an overpayment, no
health insurer shall require the physician to repay the alleged
overpayment before the appeal is concluded.
(d) Limitation.--Nothing under this section shall be
construed to limit a health insurer's right to pursue recovery
of overpayments that occurred prior to the effective date of
this section if the health insurer has provided the physician
with notice of the recovery efforts prior to the effective date
of this section.
Section 17. Confirmation of medical necessity.
(a) Revocation.--If the health insurer certifies or
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precertifies, approves or preapproves that a proposed service is
medically necessary for one of its plan members, the health
insurer shall not subsequently revoke that medical necessity
determination absent from evidence of fraud, evidence that the
information submitted was materially erroneous or incomplete or
evidence of material change in that plan member's health
condition between the date that the certification or
precertification was provided and the date of the service that
makes the proposed service no longer medically necessary for the
plan member.
(b) New request.--If a health insurer certifies or
precertifies the medical necessity of a course of treatment
limited by number, time period or otherwise, a request for
services beyond the certified course of treatment shall be
deemed to be a new request and that health insurer's denial of
such request shall not be deemed to be inconsistent with this
section.
Section 18. Communications with plan members.
(a) Exchange of information.--No health insurer shall
include in its contracts with participating physicians,
participating physician groups or participating physician
organizations any provision limiting:
(1) The free, open and unrestricted exchange of
information between its physicians and its plan members
regarding the nature of the plan member's medical conditions
or treatment and provider options and the relative risks,
benefits and costs to the plan member of the options.
(2) Whether or not the treatment is covered under the
plan member's plan.
(3) Any right to appeal any adverse decision by the
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health insurer regarding coverage of treatment that has been
recommended or rendered.
(b) Prohibition.--A health insurer may not penalize or
sanction participating physicians for engaging in any free, open
and unrestricted communication with a plan member with respect
to the subjects under subsection (a) or for advocating for any
service on behalf of a plan member.
Section 19. Arbitration.
(a) Refund.--With respect to any arbitration proceeding
between a health insurer and its participating physician who
practices individually or in a participating physician group of
fewer than six physicians, the health insurer shall refund any
applicable filing fees and arbitrator's fees paid by the
physician if the physician is the prevailing party with respect
to the arbitration proceeding. This subsection shall not apply
to any arbitration proceeding in which the participating
physician purports to represent any physician outside of the
physician group of the physician.
(b) Prohibited language.--A health insurer may not include
in any agreement with a physician, physician group or physician
organization a provision:
(1) requiring that any arbitration panel have multiple
members;
(2) preventing the recovery of any statutory or
otherwise legally available damages or other relief in an
arbitration proceeding;
(3) restricting the statutory or otherwise legally
available scope or standard of review;
(4) completely prohibiting discovery;
(5) shortening any statute of limitations; or
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(6) requiring that any arbitration proceeding occur more
than 50 miles from the principal office of the physician,
physician group or physician organization.
Section 20. Most favored nation clause.
A health insurer may not include a most favored nation clause
in its contracts with participating physicians, participating
physician groups and participating physician organizations,
except for individually negotiated contracts.
Section 21. Enforcement.
A physician may initiate a claim in a court of competent
jurisdiction following exhaustion of the internal and external
review processes.
Section 22. Effective date.
This act shall take effect immediately.
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