S1137B1621A06103 DMS:DM 03/11/08 #90 A06103
AMENDMENTS TO SENATE BILL NO. 1137
Sponsor: REPRESENTATIVE EACHUS
Printer's No. 1621
1 Amend Title, page 1, lines 15 through 22, by striking out
2 "further providing for medical" in line 15 and all of lines 16
3 through 22 and inserting
4 further providing for medical professional liability insurance,
5 for the Medical Care Availability and Reduction of Error Fund
6 and for actuarial data; establishing the Pennsylvania Access to
7 Basic Care (PA ABC) Program Fund and the Continuing Access with
8 Relief for Employers (CARE) Fund; further defining "health care
9 provider"; further providing for the Health Care Provider
10 Retention Program; establishing the Supplemental Assistance and
11 Funding Account; further providing for expiration of the Health
12 Care Provider Retention Program; establishing the Pennsylvania
13 Access to Basic Care (PA ABC) Program; providing for Continuing
14 Access with Relief for Employers (CARE) Grants, for health care
15 coverage for certain adults, individuals, employees and
16 employers and for expiration of certain sections; and repealing
17 provisions of the Tobacco Settlement Act.
18 Amend Bill, page 1, lines 25 and 26; pages 2 through 20,
19 lines 1 through 30; page 21, lines 1 through 10, by striking out
20 all of said lines on said pages and inserting
21 Section 1. Section 711(d) and (g) of the act of March 20,
22 2002 (P.L.154, No.13), known as the Medical Care Availability
23 and Reduction of Error (Mcare) Act, are amended to read:
24 Section 711. Medical professional liability insurance.
25 * * *
26 (d) Basic coverage limits.--A health care provider shall
27 insure or self-insure medical professional liability in
28 accordance with the following:
29 (1) For policies issued or renewed in the calendar year
30 2002, the basic insurance coverage shall be:
31 (i) $500,000 per occurrence or claim and $1,500,000
32 per annual aggregate for a health care provider who
33 conducts more than 50% of its health care business or
34 practice within this Commonwealth and that is not a
35 hospital.
36 (ii) $500,000 per occurrence or claim and $1,500,000
37 per annual aggregate for a health care provider who
1 conducts 50% or less of its health care business or
2 practice within this Commonwealth.
3 (iii) $500,000 per occurrence or claim and
4 $2,500,000 per annual aggregate for a hospital.
5 (2) For policies issued or renewed in the calendar years
6 2003[, 2004 and 2005] through 2008, the basic insurance
7 coverage shall be:
8 (i) $500,000 per occurrence or claim and $1,500,000
9 per annual aggregate for a participating health care
10 provider that is not a hospital.
11 (ii) $1,000,000 per occurrence or claim and
12 $3,000,000 per annual aggregate for a nonparticipating
13 health care provider.
14 (iii) $500,000 per occurrence or claim and
15 $2,500,000 per annual aggregate for a hospital.
16 [(3) Unless the commissioner finds pursuant to section
17 745(a) that additional basic insurance coverage capacity is
18 not available, for policies issued or renewed in calendar
19 year 2006 and each year thereafter subject to paragraph (4),
20 the basic insurance coverage shall be:
21 (i) $750,000 per occurrence or claim and $2,250,000
22 per annual aggregate for a participating health care
23 provider that is not a hospital.
24 (ii) $1,000,000 per occurrence or claim and
25 $3,000,000 per annual aggregate for a nonparticipating
26 health care provider.
27 (iii) $750,000 per occurrence or claim and
28 $3,750,000 per annual aggregate for a hospital.
29 If the commissioner finds pursuant to section 745(a) that
30 additional basic insurance coverage capacity is not
31 available, the basic insurance coverage requirements shall
32 remain at the level required by paragraph (2); and the
33 commissioner shall conduct a study every two years until the
34 commissioner finds that additional basic insurance coverage
35 capacity is available, at which time the commissioner shall
36 increase the required basic insurance coverage in accordance
37 with this paragraph.
38 (4) Unless the commissioner finds pursuant to section
39 745(b) that additional basic insurance coverage capacity is
40 not available, for policies issued or renewed three years
41 after the increase in coverage limits required by paragraph
42 (3) and for each year thereafter, the basic insurance
43 coverage shall be:
44 (i) $1,000,000 per occurrence or claim and
45 $3,000,000 per annual aggregate for a participating
46 health care provider that is not a hospital.
47 (ii) $1,000,000 per occurrence or claim and
48 $3,000,000 per annual aggregate for a nonparticipating
49 health care provider.
50 (iii) $1,000,000 per occurrence or claim and
51 $4,500,000 per annual aggregate for a hospital.
52 If the commissioner finds pursuant to section 745(b) that
53 additional basic insurance coverage capacity is not
54 available, the basic insurance coverage requirements shall
55 remain at the level required by paragraph (3); and the
56 commissioner shall conduct a study every two years until the
57 commissioner finds that additional basic insurance coverage
58 capacity is available, at which time the commissioner shall
59 increase the required basic insurance coverage in accordance
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1 with this paragraph.]
2 (5) For policies issued or renewed in calendar year
3 2009, the basic insurance coverage shall be:
4 (i) $550,000 per occurrence or claim and $1,650,000
5 per annual aggregate for a participating health care
6 provider that is not a hospital.
7 (ii) $1,000,000 per occurrence or claim and
8 $3,000,000 per annual aggregate for a nonparticipating
9 health care provider.
10 (iii) $550,000 per occurrence or claim and
11 $2,700,000 per annual aggregate for a hospital.
12 (6) For policies issued or renewed in calendar years
13 2010 and thereafter:
14 (i) The basic insurance coverage for a participating
15 health care provider that is not a hospital shall
16 increase by $50,000 per occurrence or claim and $150,000
17 per annual aggregate per year until such time as the
18 basic insurance coverage required shall be $1,000,000 per
19 occurrence or claim and $3,000,000 per annual aggregate.
20 (ii) The basic insurance coverage for a
21 nonparticipating health care provider shall be $1,000,000
22 per occurrence or claim and $3,000,000 per annual
23 aggregate.
24 (iii) The basic insurance coverage for a hospital
25 shall increase by $50,000 per occurrence or claim and
26 $200,000 per annual aggregate until such time as the
27 basic insurance coverage requirement shall be $1,000,000
28 per occurrence or claim and $4,500,000 per annual
29 aggregate per year.
30 (7) Basic insurance coverage amounts shall be exclusive
31 of a deductible or any other contribution from the health
32 care provider.
33 * * *
34 (g) Basic insurance liability.--
35 (1) An insurer providing medical professional liability
36 insurance shall not be liable for payment of a claim against
37 a health care provider for any loss or damages awarded in a
38 medical professional liability action in excess of the basic
39 insurance coverage required by subsection (d) unless the
40 health care provider's medical professional liability
41 insurance policy or self-insurance plan provides for a higher
42 limit.
43 (2) If a claim exceeds the limits of a participating
44 health care provider's basic insurance coverage or self-
45 insurance plan, the fund shall be responsible for payment of
46 the claim against the participating health care provider up
47 to the fund liability limits. The fund shall not be
48 responsible if a claimant has waived collection of any
49 portion of the applicable basic insurance coverage limit.
50 (3) If the health care provider has more than one basic
51 insurance coverage policy with more than one insurer
52 applicable to a claim, the fund shall be liable when the
53 policy with the highest limit has been tendered to the fund.
54 * * *
55 Section 2. Section 712(c), (d), (e), (i), (j) and (m) of the
56 act are amended and the section is amended by adding a
57 subsection to read:
58 Section 712. Medical Care Availability and Reduction of Error
59 Fund.
SB1137A06103 - 3 -
1 * * *
2 (c) Fund liability limits.--
3 (1) For calendar year 2002, the limit of liability of
4 the fund created in section 701(d) of the former Health Care
5 Services Malpractice Act for each health care provider that
6 conducts more than 50% of its health care business or
7 practice within this Commonwealth and for each hospital shall
8 be $700,000 for each occurrence and $2,100,000 per annual
9 aggregate.
10 (2) The limit of liability of the fund for each
11 participating health care provider shall be [as follows:
12 (i) For] for calendar year 2003 and each year
13 thereafter, the limit of liability of the fund shall be
14 $500,000 for each occurrence and $1,500,000 per annual
15 aggregate.
16 [(ii) If the basic insurance coverage requirement is
17 increased in accordance with section 711(d)(3) and,
18 notwithstanding subparagraph (i), for each calendar year
19 following the increase in the basic insurance coverage
20 requirement, the limit of liability of the fund shall be
21 $250,000 for each occurrence and $750,000 per annual
22 aggregate.
23 (iii) If the basic insurance coverage requirement is
24 increased in accordance with section 711(d)(4) and,
25 notwithstanding subparagraphs (i) and (ii), for each
26 calendar year following the increase in the basic
27 insurance coverage requirement, the limit of liability of
28 the fund shall be zero.]
29 (3) The limit of liability of the fund for each
30 participating health care provider shall be:
31 (i) For calendar years 2003 through 2008, $500,000
32 for each occurrence and $1,500,000 per annual aggregate.
33 (ii) For calendar year 2009, $450,000 per occurrence
34 or claim and $1,350,000 per annual aggregate.
35 (iii) For calendar years 2010 and thereafter, the
36 limit of liability shall decrease by $50,000 per
37 occurrence or claim and $150,000 per annual aggregate per
38 year until such time as the fund limit of liability shall
39 be zero dollars per occurrence or claim and zero dollars
40 per annual aggregate.
41 (d) Assessments.--
42 (1) For calendar [year 2003 and for each year
43 thereafter,] years 2003 through 2017, the fund shall be
44 funded by an assessment on each participating health care
45 provider. Assessments shall be levied by the department on or
46 after January 1 of each year. The assessment shall be based
47 on the prevailing primary premium for each participating
48 health care provider and shall, in the aggregate, produce an
49 amount sufficient to do all of the following:
50 (i) Reimburse the fund for the payment of reported
51 claims which became final during the preceding claims
52 period.
53 (ii) Pay expenses of the fund incurred during the
54 preceding claims period.
55 (iii) Pay principal and interest on moneys
56 transferred into the fund in accordance with section
57 713(c).
58 (iv) Provide a reserve that shall be 10% of the sum
59 of subparagraphs (i), (ii) and (iii).
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1 (2) The department shall notify all basic insurance
2 coverage insurers and self-insured participating health care
3 providers of the assessment by November 1 for the succeeding
4 calendar year.
5 (3) Any appeal of the assessment shall be filed with the
6 department.
7 [(e) Discount on surcharges and assessments.--
8 (1) For calendar year 2002, the department shall
9 discount the aggregate surcharge imposed under section
10 701(e)(1) of the Health Care Services Malpractice Act by 5%
11 of the aggregate surcharge imposed under that section for
12 calendar year 2001 in accordance with the following:
13 (i) Fifty percent of the aggregate discount shall be
14 granted equally to hospitals and to participating health
15 care providers that were surcharged as members of one of
16 the four highest rate classes of the prevailing primary
17 premium.
18 (ii) Notwithstanding subparagraph (i), 50% of the
19 aggregate discount shall be granted equally to all
20 participating health care providers.
21 (iii) The department shall issue a credit to a
22 participating health care provider who, prior to the
23 effective date of this section, has paid the surcharge
24 imposed under section 701(e)(1) of the former Health Care
25 Services Malpractice Act for calendar year 2002 prior to
26 the effective date of this section.
27 (2) For calendar years 2003 and 2004, the department
28 shall discount the aggregate assessment imposed under
29 subsection (d) for each calendar year by 10% of the aggregate
30 surcharge imposed under section 701(e)(1) of the former
31 Health Care Services Malpractice Act for calendar year 2001
32 in accordance with the following:
33 (i) Fifty percent of the aggregate discount shall be
34 granted equally to hospitals and to participating health
35 care providers that were assessed as members of one of
36 the four highest rate classes of the prevailing primary
37 premium.
38 (ii) Notwithstanding subparagraph (i), 50% of the
39 aggregate discount shall be granted equally to all
40 participating health care providers.
41 (3) For calendar years 2005 and thereafter, if the basic
42 insurance coverage requirement is increased in accordance
43 with section 711(d)(3) or (4), the department may discount
44 the aggregate assessment imposed under subsection (d) by an
45 amount not to exceed the aggregate sum to be deposited in the
46 fund in accordance with subsection (m).]
47 * * *
48 (i) Change in basic insurance coverage.--If a participating
49 health care provider changes the term of its medical
50 professional liability insurance coverage, the assessment shall
51 be calculated on an annual basis and shall reflect the
52 assessment percentages in effect for the period over which the
53 policies are in effect. A policy period less than 12 months may
54 result in a prorated reduction in the Mcare annual aggregate
55 limit.
56 (j) Payment of claims.--Claims which became final during the
57 preceding claims period shall be paid on [or before] December 31
58 or the last business day of the year following the August 31 on
59 which they became final.
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1 * * *
2 (m) Supplemental funding.--Notwithstanding the provisions of
3 75 Pa.C.S. § 6506(b) (relating to surcharge) to the contrary,
4 beginning January 1, 2004, [and for a period of nine calendar
5 years thereafter,] through June 30, 2018, all surcharges levied
6 and collected under 75 Pa.C.S. § 6506(a) by any division of the
7 unified judicial system shall be remitted to the Commonwealth
8 for deposit in the Medical Care Availability and [Restriction]
9 Reduction of Error Fund. These funds shall be used to reduce
10 surcharges and assessments in accordance with subsection (e).
11 Beginning [January 1, 2014] July 1, 2018, and each year
12 thereafter, the surcharges levied and collected under 75 Pa.C.S.
13 § 6506(a) shall be deposited into the [General Fund.] Health
14 Care Provider Retention Account.
15 * * *
16 (o) Coverage of claims in relation to payment of certain
17 late assessments.--
18 (1) All basic insurance coverage insurers, self-insured
19 participating health care providers and risk retention groups
20 shall bill, collect and remit the assessment to the
21 department within 60 days of the inception or renewal date of
22 the primary professional liability policy.
23 (2) All basic insurance coverage insurers, self-insured
24 participating health care providers and risk retention groups
25 shall be subject to the following:
26 (i) For assessments remitted to the department in
27 excess of 60 days after the inception or renewal date of
28 the primary policy, the basic insurance coverage insurer,
29 self-insured participating health care provider or risk
30 retention group shall pay to the department a penalty
31 equal to 10% per annum of each untimely assessment
32 accruing from the 61st day after the inception or renewal
33 date of the primary policy until the remittance is
34 received by the department.
35 (ii) In addition to the provisions of subparagraph
36 (i), if the department finds that there has been a
37 pattern or practice of not complying with this section,
38 the basic insurance coverage insurer, self-insured
39 participating health care provider or risk retention
40 group shall be subject to the penalties and process set
41 forth in the act of July 22, 1974 (P.L.589, No.205),
42 known as the Unfair Insurance Practices Act.
43 (iii) If the basic insurance coverage insurer, self-
44 insurer or risk retention group receives the assessment
45 from a health care provider, professional corporation or
46 professional association with less than 30 days to make
47 the remittance timely as provided under this subsection,
48 the basic insurance coverage insurer, self-insurer or
49 risk retention group remittance period shall be extended
50 by 30 days from the date of receipt upon providing
51 reasonable evidence to the department regarding the date
52 of receipt and shall not be subject to the penalties
53 provided for under this section.
54 (iv) If the basic insurance coverage insurer, self-
55 insurer or risk retention group receives an assessment
56 after 60 days of the inception or renewal date of the
57 primary professional liability policy and remits the
58 assessment within 30 days from the date of receipt, the
59 basic insurance coverage insurer, self-insurer or risk
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1 retention group shall not be subject to the penalties
2 provided for under this section. Remittances to the
3 department beyond the 30-day period shall be subject to
4 the penalties provided for under this section.
5 (v) (A) A health care provider or professional
6 corporation, professional association or partnership
7 shall be provided coverage from the inception or
8 renewal date of the primary professional liability
9 policy if the billed assessment is paid to the basic
10 insurance coverage insurer, self-insurer or risk
11 retention group within 60 days of the inception or
12 renewal date of the primary professional liability
13 policy.
14 (B) A health care provider or professional
15 corporation, professional association or partnership
16 that fails to pay the billed assessment to its basic
17 insurance coverage insurer, self-insurer or risk
18 retention group within 60 days of policy inception or
19 renewal and before receiving notice of a claim shall
20 not have coverage for that claim.
21 (C) If a health care provider or professional
22 corporation, professional association or partnership
23 is billed by the basic insurance coverage insurer,
24 self-insurer or risk retention group later than 30
25 days after the policy inception or renewal date and
26 the health care provider or professional corporation,
27 professional association or partnership pays the
28 basic insurance coverage insurer, self-insurer or
29 risk retention group within 30 days from the date of
30 receipt of the bill and the basic insurance coverage
31 insurer, self-insurer or risk retention group carrier
32 remits the assessment to the department within 30
33 days from the date of receipt, the health care
34 provider shall be provided coverage as of the
35 inception or renewal date of the primary policy.
36 Coverage shall also be provided to the health care
37 provider or professional corporation, professional
38 association or partnership for all professional
39 liability claims made after payment of the
40 assessment.
41 (vi) Except as to provisions in conflict with this
42 section, nothing in this section shall be construed to
43 affect existing regulations saved by section 5107(a), and
44 all existing regulations shall remain in full force and
45 effect.
46 Section 3. Section 745 of the act is repealed:
47 [Section 745. Actuarial data.
48 (a) Initial study.--The following shall apply:
49 (1) No later than April 1, 2005, each insurer providing
50 medical professional liability insurance in this Commonwealth
51 shall file loss data as required by the commissioner. For
52 failure to comply, the commissioner shall impose an
53 administrative penalty of $1,000 for every day that this data
54 is not provided in accordance with this paragraph.
55 (2) By July 1, 2005, the commissioner shall conduct a
56 study regarding the availability of additional basic
57 insurance coverage capacity. The study shall include an
58 estimate of the total change in medical professional
59 liability insurance loss-cost resulting from implementation
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1 of this act prepared by an independent actuary. The fee for
2 the independent actuary shall be borne by the fund. In
3 developing the estimate, the independent actuary shall
4 consider all of the following:
5 (i) The most recent accident year and ratemaking
6 data available.
7 (ii) Any other relevant factors within or outside
8 this Commonwealth in accordance with sound actuarial
9 principles.
10 (b) Additional study.--The following shall apply:
11 (1) Three years following the increase of the basic
12 insurance coverage requirement in accordance with section
13 711(d)(3), each insurer providing medical professional
14 liability insurance in this Commonwealth shall file loss data
15 with the commissioner upon request. For failure to comply,
16 the commissioner shall impose an administrative penalty of
17 $1,000 for every day that this data is not provided in
18 accordance with this paragraph.
19 (2) Three months following the request made under
20 paragraph (1), the commissioner shall conduct a study
21 regarding the availability of additional basic insurance
22 coverage capacity. The study shall include an estimate of the
23 total change in medical professional liability insurance
24 loss-cost resulting from implementation of this act prepared
25 by an independent actuary. The fee for the independent
26 actuary shall be borne by the fund. In developing the
27 estimate, the independent actuary shall consider all of the
28 following:
29 (i) The most recent accident year and ratemaking
30 data available.
31 (ii) Any other relevant factors within or outside
32 this Commonwealth in accordance with sound actuarial
33 principles.]
34 Section 4. Chapter 7 of the act is amended by adding
35 subchapters to read:
36 SUBCHAPTER E
37 PENNSYLVANIA ACCESS TO BASIC CARE
38 (PA ABC) PROGRAM FUND
39 Section 751. Establishment.
40 There is established within the State Treasury a special fund
41 to be known as the Pennsylvania Access to Basic Care (PA ABC)
42 Program Fund.
43 Section 752. Allocation.
44 Money in the Pennsylvania Access to Basic Care (PA ABC)
45 Program Fund is hereby appropriated upon approval of the
46 Governor for health care coverage and services under Chapter 13.
47 SUBCHAPTER F
48 CONTINUING ACCESS WITH RELIEF FOR
49 EMPLOYERS (CARE) FUND
50 Section 761. Establishment.
51 There is established within the State Treasury a special fund
52 to be known as the Continuing Access with Relief for Employers
53 (CARE) Fund.
54 Section 762. Allocation.
55 Money in the Continuing Access with Relief for Employers
56 (CARE) Fund is hereby appropriated on a continuing basis to the
57 Department of Community and Economic Development and shall be
58 dedicated to assisting certain employers that currently offer
59 and maintain health care coverage for their employees in
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1 compliance with the requirements under section 1308.
2 Section 5. The definition of "health care provider" in
3 section 1101 of the act, added December 22, 2005 (P.L.458,
4 No.88), is amended to read:
5 Section 1101. Definitions.
6 The following words and phrases when used in this chapter
7 shall have the meanings given to them in this section unless the
8 context clearly indicates otherwise:
9 * * *
10 "Health care provider." [An individual who is all of the
11 following:
12 (1) A physician, licensed podiatrist, certified nurse
13 midwife or nursing home.
14 (2) A participating health care provider as defined in
15 section 702.] Any of the following:
16 (1) A nursing home or birth center that is a
17 participating health care provider as defined in section 702.
18 (2) An individual who is a physician, licensed
19 podiatrist or certified nurse midwife.
20 * * *
21 Section 6. Section 1102 of the act, amended October 27, 2006
22 (P.L.1198, No.128), is amended to read:
23 Section 1102. Abatement program.
24 (a) Establishment.--There is hereby established within the
25 Insurance Department a program to be known as the Health Care
26 Provider Retention Program. The Insurance Department, in
27 conjunction with the Department of Public Welfare, shall
28 administer the program. The program shall provide assistance in
29 the form of assessment abatements to health care providers for
30 calendar years [2003, 2004, 2005, 2006 and 2007] beginning 2003
31 and ending 2017, except that licensed podiatrists shall not be
32 eligible for calendar years 2003 and 2004, and nursing homes
33 shall not be eligible for calendar years 2003, 2004 and 2005.
34 (b) Other [abatement.--] abatements.--
35 (1) Emergency physicians not employed full time by a
36 trauma center or working under an exclusive contract with a
37 trauma center shall retain eligibility for an abatement
38 pursuant to section 1104(b)(2) for calendar years 2003, 2004,
39 2005 and 2006. Commencing in calendar year 2007, these
40 emergency physicians shall be eligible for an abatement
41 pursuant to section 1104(b)(1).
42 (2) Birth centers shall retain eligibility for abatement
43 pursuant to section 1104(b)(2) for calendar years 2003, 2004,
44 2005, 2006 and 2007. Commencing in calendar year 2008, birth
45 centers shall be eligible for abatement pursuant to section
46 1104(b)(1).
47 Section 7. Section 1103 of the act, added December 22, 2005
48 (P.L.458, No.88), is amended by adding paragraphs to read:
49 Section 1103. Eligibility.
50 A health care provider shall not be eligible for [assessment]
51 abatement under the program if any of the following apply:
52 * * *
53 (6) The health care provider has refused to be an active
54 provider in the Pennsylvania Access to Basic Care (PA ABC)
55 Program in the health care provider's service area.
56 (7) The active health care provider is an active
57 provider in the Pennsylvania Access to Basic Care (PA ABC)
58 Program and places restrictions on benefits for patients
59 enrolled in that program.
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1 (8) The health care provider has refused to be an active
2 provider in the children's health insurance program
3 established under Article XXIII of the act of May 17, 1921
4 (P.L.682, No.284), known as The Insurance Company Law of
5 1921.
6 (9) The active health care provider is an active
7 provider in the children's health insurance program and
8 places restrictions on benefits for patients enrolled in the
9 children's health insurance program.
10 (10) The Department of Revenue has determined that the
11 health care provider has not filed all required State tax
12 reports and returns for all applicable taxable years or has
13 not paid any balance of State tax due as determined at
14 settlement, assessment or determination by the Department of
15 Revenue that are not subject to a timely perfected
16 administrative or judicial appeal or subject to a duly
17 authorized deferred payment plan as of the date of
18 application. Notwithstanding the provisions of section 353(f)
19 of the act of March 4, 1971 (P.L.6, No.2), known as the Tax
20 Reform Code of 1971, the Department of Revenue shall supply
21 the Insurance Department with information concerning the
22 status of delinquent taxes owed by a health care provider for
23 purposes of this paragraph.
24 (11) (i) The health care provider has not attended at
25 least one Commonwealth-sponsored independent drug
26 information service session, either in person or by
27 videoconference.
28 (ii) This paragraph does not apply if the
29 Commonwealth has not made a Commonwealth-sponsored
30 independent drug information service session available to
31 the health care provider prior to the date that the
32 health care provider's application is submitted under
33 section 1104.
34 Section 8. Section 1104(b) of the act, amended December 22,
35 2005 (P.L.458, No.88), is amended to read:
36 Section 1104. Procedure.
37 * * *
38 (b) Review.--Upon receipt of a completed application, the
39 Insurance Department shall review the applicant's information
40 and grant the applicable abatement of the assessment for the
41 previous calendar year specified on the application in
42 accordance with all of the following:
43 (1) The Insurance Department shall notify the Department
44 of Public Welfare that the applicant has self-certified as
45 eligible and was not disqualified for an abatement under
46 section 1103(6), (7), (8), (9), (10) and (11) for a 100%
47 abatement of the imposed assessment if the health care
48 provider was assessed under section 712(d) as:
49 (i) a physician who is assessed as a member of one
50 of the four highest rate classes of the prevailing
51 primary premium;
52 (ii) an emergency physician;
53 (iii) a physician who routinely provides obstetrical
54 services in rural areas as designated by the Insurance
55 Department; [or]
56 (iv) a certified nurse midwife[.]; or
57 (v) a birth center.
58 (2) The Insurance Department shall notify the Department
59 of Public Welfare that the applicant has self-certified as
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1 eligible and was not disqualified for an abatement under
2 section 1103(6), (7), (8), (9), (10) and (11) for a 50%
3 abatement of the imposed assessment in calendar years 2008
4 through 2012, a 56.5% abatement in calendar year 2013, a
5 63.5% abatement in calendar year 2014, a 70% abatement in
6 calendar year 2015, a 78% abatement in calendar year 2016, an
7 88% abatement in calendar year 2017 and a 100% abatement in
8 calendar year 2018 if the health care provider was assessed
9 under section 712(d) as:
10 (i) a physician but is a physician who does not
11 qualify for abatement under paragraph (1);
12 (ii) a licensed podiatrist; [or]
13 (iii) a nursing home[.]; or
14 (iv) a birth center.
15 * * *
16 Section 9. Section 1112(c) and (e) of the act, added
17 December 22, 2005 (P.L.458, No.88), are amended and the section
18 is amended by adding subsections to read:
19 Section 1112. Health Care Provider Retention Account.
20 * * *
21 (a.1) Supplemental Assistance and Funding Account.--There is
22 established within the Health Care Provider Retention Account a
23 special account to be known as the Supplemental Assistance and
24 Funding Account. Funds in this account shall be used annually to
25 supplement the funding of the Pennsylvania Access to Basic Care
26 (PA ABC) Program.
27 * * *
28 (c) Transfers from account.--
29 (1) The Secretary of the Budget may annually transfer
30 from the account to the Medical Care Availability and
31 Reduction of Error (Mcare) Fund an amount up to the aggregate
32 amount of abatements granted by the Insurance Department
33 under section 1104(b).
34 (2) In addition to the transfers specified in paragraph
35 (1), the Secretary of the Budget may also transfer funds from
36 the account to the Medical Care Availability and Reduction of
37 Error (Mcare) Fund for the purpose of paying claims and
38 operating expenses coming due after January 1, 2018.
39 (3) The Secretary of the Budget may transfer funds from
40 the account to the Pennsylvania Access to Basic Care (PA ABC)
41 Program Fund.
42 (4) The Secretary of the Budget shall annually transfer
43 from the account to the Continuing Access Relief for
44 Employers (CARE) Fund an amount at least equal to the amount
45 deposited under section 712(m).
46 (c.1) Transfers from the Supplemental Assistance and Funding
47 Account.--The Secretary of the Budget shall annually transfer
48 funds from the Supplemental Assistance and Funding Account
49 established under subsection (a.1) to the Pennsylvania Access to
50 Basic Care (PA ABC) Program Fund.
51 * * *
52 [(e) Administration assistance.--The Insurance Department
53 shall provide assistance to the Department of Public Welfare in
54 administering the account.]
55 Section 10. Section 1115 of the act, amended October 27,
56 2006 (P.L.1198, No.128), is amended to read:
57 Section 1115. Expiration.
58 The Health Care Provider Retention Program established under
59 this chapter shall expire December 31, [2008] 2018.
SB1137A06103 - 11 -
1 Section 11. The act is amended by adding a chapter to read:
2 CHAPTER 13
3 PENNSYLVANIA ACCESS TO BASIC CARE (PA ABC) PROGRAM
4 Section 1301. Scope.
5 This chapter relates to offering health care coverage to
6 eligible adults, individuals, employees and employers.
7 Section 1302. Definitions.
8 The following words and phrases when used in this chapter
9 shall have the meanings given to them in this section unless the
10 context clearly indicates otherwise:
11 "AdultBasic Program." The adult basic coverage insurance
12 program established under section 1303 of the act of June 26,
13 2001 (P.L.755, No.77), known as the Tobacco Settlement Act.
14 "Average annual wage." The total annual wages paid by an
15 employer divided by the number of the employer's full-time
16 equivalent employees.
17 "Behavioral health services." Mental health or substance
18 abuse services.
19 "Children's health insurance program." The children's health
20 care program established under Article XXIII of the act of May
21 17, 1921 (P.L.682, No.284), known as The Insurance Company Law
22 of 1921.
23 "Chronic disease management program." A program that allows
24 a patient, with the support of a health care team, to play an
25 active role in the patient's care and assures that there is an
26 infrastructure to ensure compliance with established practice
27 guidelines.
28 "Community Health Reinvestment Agreement." The Agreement on
29 Community Health Reinvestment entered into February 2, 2005, by
30 the Insurance Department and Capital Blue Cross, Highmark Inc.,
31 Hospital Service Association of Northeastern Pennsylvania and
32 Independence Blue Cross and published in the Pennsylvania
33 Bulletin at 35 Pa.B. 4155.
34 "Contractor." An insurer awarded a contract to provide
35 health care services under this chapter. The term includes an
36 entity and its subsidiary which is established under 40 Pa.C.S.
37 Ch. 61 (relating to hospital plan corporations) or 63 (relating
38 to professional health services plan corporations), the act of
39 May 17, 1921 (P.L.682, No.284), known as The Insurance Company
40 Law of 1921, or the act of December 29, 1972 (P.L.1701, No.364),
41 known as the Health Maintenance Organization Act.
42 "Department." The Insurance Department of the Commonwealth.
43 "Eligible adult." An individual who meets all of the
44 following:
45 (1) Is at least 19 years of age but not more than 64
46 years of age.
47 (2) Legally resides within the United States.
48 (3) Has been domiciled in this Commonwealth for at least
49 90 days prior to application to the program.
50 (4) Is ineligible to receive continuous eligibility
51 coverage under Title XIX or XXI of the Social Security Act
52 (49 Stat. 620, 42 U.S.C. § 301 et seq.), except for benefits
53 authorized under a waiver granted by the United States
54 Department of Health and Human Services to implement the
55 Pennsylvania Access to Basic Care (PA ABC) Program.
56 (5) Is ineligible for medical assistance or Medicare.
57 (6) May currently be enrolled in the AdultBasic Program
58 or is on the waiting list for that program on the effective
59 date of this section.
SB1137A06103 - 12 -
1 (7) Subject to the provisions of section 1305, has a
2 household income that is no greater than 300% of the Federal
3 poverty level at the time of application.
4 (8) Has not been covered by any health insurance plan or
5 program for at least 180 days immediately preceding the date
6 of application, except that the 180-day period shall not
7 apply to an eligible adult who meets one of the following:
8 (i) is eligible to receive benefits under the act of
9 December 5, 1936 (2nd Sp.Sess., 1937 P.L.2897, No.1),
10 known as the Unemployment Compensation Law;
11 (ii) was covered under a health insurance plan or
12 program provided by an employer, but at the time of
13 application is no longer covered because of a change in
14 the individual's employment status and is ineligible to
15 receive benefits under the Unemployment Compensation Law;
16 (iii) lost coverage as a result of divorce or
17 separation from a covered individual, the death of a
18 covered individual or a change in employment status of a
19 covered individual; or
20 (iv) is transferring from another government-
21 subsidized health insurance program, including a transfer
22 that occurs as a result of failure to meet income
23 eligibility requirements.
24 "Eligible employee." An eligible adult or an employee who
25 meets all the requirements of an eligible adult or employee at
26 the time the eligible employer makes application to the program.
27 "Eligible employer." An employer that meets all of the
28 following:
29 (1) Has at least two but not more than 50 full-time
30 equivalent employees.
31 (2) Has not offered health care coverage through any
32 plan or program during the 180 days immediately preceding the
33 date of application for participation in the Pennsylvania
34 Access to Basic Care (PA ABC) Program.
35 (3) Has not provided remuneration in any form to an
36 employee on payroll for the purchase of health care coverage
37 during the 180 days immediately preceding the date on which
38 the employer applies for participation in the program.
39 (4) Pays an average annual wage that is less than 300%
40 of the Federal poverty level for an individual.
41 "Employee." An individual who is employed for more than 20
42 hours in a single week and from whose wages an employer is
43 required under the Internal Revenue Code of 1986 (Public Law 99-
44 514, 26 U.S.C. § 1 et seq.) to withhold Federal income tax.
45 "Employer." The term shall include:
46 (1) Any of the following who or which employs two but
47 not more than 50 employees to perform services for
48 remuneration:
49 (i) an individual, partnership, association,
50 domestic or foreign corporation or other entity;
51 (ii) the legal representative, trustee in
52 bankruptcy, receiver or trustee of any individual,
53 partnership, association or corporation or other entity;
54 or
55 (iii) the legal representative of a deceased
56 individual.
57 (2) An individual who is self-employed.
58 (3) The executive, legislative and judicial branches of
59 the Commonwealth and any one of its political subdivisions.
SB1137A06103 - 13 -
1 "Fund." The Pennsylvania Access to Basic Care (PA ABC)
2 Program Fund.
3 "Health benefit plan." An insurance coverage plan that
4 provides the benefits set forth under section 1313. The term
5 does not include any of the following:
6 (1) An accident-only policy.
7 (2) A credit-only policy.
8 (3) A long-term or disability income policy.
9 (4) A specified disease policy.
10 (5) A Medicare supplement policy.
11 (6) A Civilian Health and Medical Program of the
12 Uniformed Services (CHAMPUS) supplement policy.
13 (7) A fixed indemnity policy.
14 (8) A dental-only policy.
15 (9) A vision-only policy.
16 (10) A workers' compensation policy.
17 (11) An automobile medical payment policy pursuant to 75
18 Pa.C.S. (relating to vehicles).
19 (12) Such other similar policies providing for limited
20 benefits.
21 "Health care coverage." A health benefit plan or other form
22 of health care coverage that is approved by the Department of
23 Community and Economic Development in consultation with the
24 Insurance Department. The term does not include coverage under
25 the PA ABC program.
26 "Health maintenance organization" or "HMO." An entity
27 organized and regulated under the act of December 29, 1972
28 (P.L.1701, No.364), known as the Health Maintenance Organization
29 Act.
30 "Health savings account." An account established by an
31 employer under section 1307 on behalf of an employee whose
32 income is greater than 200% of the Federal poverty level.
33 "Hospital." An institution that has an organized medical
34 staff engaged primarily in providing to inpatients, by or under
35 the supervision of physicians, diagnostic and therapeutic
36 services for the care of injured, disabled, pregnant, diseased
37 or sick or mentally ill persons. The term includes a facility
38 for the diagnosis and treatment of disorders within the scope of
39 specific medical specialties. The term does not include a
40 facility that cares exclusively for the mentally ill.
41 "Hospital plan corporation." A hospital plan corporation as
42 defined in 40 Pa.C.S. § 6101 (relating to definitions).
43 "Individual." A person who meets all the requirements of an
44 eligible adult but whose household income is greater than 300%
45 of the Federal poverty level.
46 "Insurer." A company or health insurance entity licensed in
47 this Commonwealth to issue an individual or group health,
48 sickness or accident policy or subscriber contract or
49 certificate or plan that provides medical or health care
50 coverage by a health care facility or licensed health care
51 provider and that is offered or governed under this act or any
52 of the following:
53 (1) The act of May 17, 1921 (P.L.682, No.284), known as
54 The Insurance Company Law of 1921.
55 (2) The act of December 29, 1972 (P.L.1701, No.364),
56 known as the Health Maintenance Organization Act.
57 (3) The act of May 18, 1976 (P.L.123, No.54), known as
58 the Individual Accident and Sickness Insurance Minimum
59 Standards Act.
SB1137A06103 - 14 -
1 (4) 40 Pa.C.S. Ch. 61 (relating to hospital plan
2 corporations) or 63 (relating to professional health services
3 plan corporations).
4 "Medical assistance." The State program of medical
5 assistance established under the act of June 13, 1967 (P.L.31,
6 No.21), known as the Public Welfare Code.
7 "Medical loss ratio." The ratio of paid medical claim costs
8 to earned premiums.
9 "Medicare." The Federal program established under Title
10 XVIII of the Social Security Act (49 Stat. 620, 42 U.S.C. § 1395
11 et seq.).
12 "Offeror." An insurer that submits a bid or proposal under
13 section 1311 in response to the department's procurement
14 solicitation.
15 "Preexisting condition." A disease or physical condition for
16 which medical advice or treatment has been received prior to the
17 effective date of coverage.
18 "Prescription drug." A controlled substance, other drug or
19 device for medication dispensed by order of an appropriately
20 licensed medical professional.
21 "Professional health services plan corporation." A not-for-
22 profit corporation operating under the provisions of 40 Pa.C.S.
23 Ch. 63 (relating to professional health services plan
24 corporations).
25 "Program." The Pennsylvania Access to Basic Care (PA ABC)
26 Program established under this chapter.
27 "Qualifying health care coverage." A health benefit plan or
28 other form of health care coverage actuarially equivalent to the
29 benefits in section 1313 and approved by the Insurance
30 Department.
31 "Terminate." The term includes cancellation, nonrenewal and
32 rescission.
33 "Unemployment Compensation Law." The act of December 5, 1936
34 (2nd Sp.Sess., 1937 P.L.2897, No.1), known as the Unemployment
35 Compensation Law.
36 "Uninsured period." A continuous period of time of not less
37 than 180 consecutive days immediately preceding enrollment
38 application during which an adult has been without health care
39 coverage in accordance with the requirements of this chapter.
40 Section 1303. Establishment of program.
41 The Pennsylvania Access to Basic Care (PA ABC) Program is
42 established in the department.
43 Section 1304. Funding.
44 (a) Sources.--The following are the sources of money for the
45 program:
46 (1) Money received from the Supplemental Assistance and
47 Funding Account established under section 1112(a.1).
48 (2) Money received from the Federal Government or other
49 sources.
50 (3) Money required to be deposited pursuant to other
51 provisions of this chapter or any other law of this
52 Commonwealth.
53 (4) Upon implementation of the program:
54 (i) Only those funds appropriated for health
55 investment insurance under section 306(b)(1)(vi) of the
56 act of June 26, 2001 (P.L.755, No.77), known as the
57 Tobacco Settlement Act, and designated for the AdultBasic
58 Program.
59 (ii) Money currently required to be dedicated to the
SB1137A06103 - 15 -
1 AdultBasic Program or any alternative program to benefit
2 persons of low income under the Community Health
3 Reinvestment Agreement within the respective service
4 areas for each party to that agreement. Money under this
5 subparagraph shall be used only to defray the cost of the
6 program and subsidies approved under sections 1305 and
7 1306.
8 (5) Any moneys derived from whatever sources and
9 designated specifically to fund the program.
10 (6) Return on investments in the fund.
11 Section 1305. Purchase by eligible adults and individuals.
12 (a) Eligible adults.--An eligible adult who seeks to
13 purchase coverage under the program must:
14 (1) Submit an application to the department or its
15 contractor.
16 (2) Pay to the department or its contractor the amount
17 of the premium specified.
18 (3) Be responsible for any required copayments for
19 health care services rendered under the health benefit plan
20 in section 1313 subject to Federal waiver requirements.
21 (4) Notify the department or its contractor of any
22 change in the eligible adult's or individual's household
23 income.
24 (b) Monthly premiums.--Except to the extent that changes may
25 be necessary to meet Federal requirements under section 1317 or
26 to encourage eligible employer participation, subsidies for the
27 2008-2009 fiscal year and each fiscal year thereafter shall
28 result in the following premium amount based on household income
29 for a health benefit plan:
30 (1) For an eligible adult whose household income is not
31 greater than 150% of the Federal poverty level, no monthly
32 premium.
33 (2) For an eligible adult whose household income is
34 greater than 150% but not greater than 175% of the Federal
35 poverty level, a monthly premium of $40.
36 (3) For an eligible adult whose household income is
37 greater than 175% but not greater than 200% of the Federal
38 poverty level, a monthly premium of $50.
39 (4) For an eligible adult whose household income is
40 greater than 200%, a monthly premium may be established based
41 upon Federal requirements and in accordance with Federal
42 waivers, if applicable, by the commissioner.
43 (c) Other eligible adults.--An eligible adult whose
44 household income is greater than 200% of the Federal poverty
45 level may purchase under the program either the benefit package
46 under section 1313 or other qualifying health care coverage at
47 the per-member, per-month premium cost.
48 (d) Individuals.--For an individual whose household income
49 is greater than 300% of the Federal poverty level, an individual
50 may purchase the benefit package under section 1313 at the per-
51 member, per-month premium cost as long as the individual
52 demonstrates, on an annual basis and in a manner determined by
53 the department, either one of the following:
54 (1) The individual is unable to afford individual or
55 group coverage because that coverage would exceed 10% of the
56 individual's household income or because the total cost of
57 coverage for the individual is 150% of the premium cost
58 established under this section for that service area.
59 (2) The individual has been refused coverage by an
SB1137A06103 - 16 -
1 insurer because the individual or a member of that
2 individual's immediate family has a preexisting condition and
3 coverage is not available to the individual.
4 (e) Establishing premiums.--For each fiscal year beginning
5 after June 30, 2009, the department may adjust the premium
6 amounts under subsection (b) to reflect changes in the cost of
7 medical services and shall forward notice of the new premium
8 amounts to the Legislative Reference Bureau for publication as a
9 notice in the Pennsylvania Bulletin.
10 (f) Purchase of health benefit plan.--An eligible adult's or
11 individual's payment to the department or its contractor under
12 subsection (b) shall be used to purchase the benefit health plan
13 established under section 1313 and must be remitted in a timely
14 manner.
15 (g) Subsidy.--Funding for the program shall be used by the
16 department to pay the difference between the total monthly cost
17 of the health benefit plan and the eligible adult's premium.
18 Subsidization of the health benefit plan is contingent upon the
19 amount of the funding for the program and is limited to eligible
20 adults in compliance with this section.
21 Section 1306. Participation by eligible employers and eligible
22 employees.
23 (a) Eligible employers.--An eligible employer that seeks to
24 participate in the program shall:
25 (1) Offer to all eligible employees the opportunity to
26 participate in the program and enroll at least one-half of
27 the eligible employees.
28 (2) Comply with the application process established by
29 the department or its contractor.
30 (3) Remit to the department or its contractor any
31 premium amounts required under subsections (c) and (d).
32 (4) Allow health insurance premiums to be paid by
33 eligible employees on a pretax basis and inform its employees
34 of the availability of such program.
35 (5) Notify the department or its contractor of any
36 change in the eligible employee's income.
37 (b) Eligible employees.--An eligible employee who seeks to
38 participate with an eligible employer under the program must:
39 (1) Submit an application with the eligible employer to
40 the department or its contractor.
41 (2) Be responsible for any required copayments for
42 health care services rendered under the health benefit plan
43 in section 1313.
44 (c) Premiums for employers.--
45 (1) In addition to remitting the eligible employee
46 portion under subsections (a) and (d), an eligible employer
47 shall pay the employer share of the total monthly cost for
48 each participating employee to the department or its
49 contractor each month.
50 (2) In addition to remitting the eligible employee
51 portion under paragraph (1), an eligible employer's premium
52 payment to the department or its contractor shall be at least
53 50% of the total monthly cost for each eligible employee but
54 not less than $150.
55 (d) Premiums for eligible employees.--The premium for
56 eligible employees shall be the same as the premium required to
57 be paid by eligible adults under section 1305(b).
58 (e) Purchase by certain eligible employees.--An eligible
59 employee whose household income is greater than 200% of the
SB1137A06103 - 17 -
1 Federal poverty level may purchase either the benefit package
2 under section 1313 or other qualifying health care coverage
3 under section 1307 at the per-member, per-month premium cost
4 minus any amount remitted by the employer under subsection (c).
5 (f) Publishing premium amounts.--For each fiscal year
6 beginning after June 30, 2009, the department may establish
7 different premium amounts for eligible employees and eligible
8 employers as required under this section and shall forward
9 notice of the new premium amounts to the Legislative Reference
10 Bureau for publication as a notice in the Pennsylvania Bulletin.
11 (g) Purchase of coverage.--A premium payment made by an
12 eligible employer to the department or its contractor shall be
13 used to purchase the health benefit plan and must be remitted in
14 a timely manner.
15 (h) Alternative coverage.--
16 (1) Notwithstanding any other provision of law to the
17 contrary, employer-based coverage may, in the commissioner's
18 sole discretion, be purchased in place of participation in
19 the program or may be purchased in conjunction with any
20 portion of the program provided outside the scope of the
21 program contracts by the Commonwealth paying the employee's
22 share of the premium to the employer if it is more cost
23 effective for the Commonwealth to purchase health care
24 coverage from an employee's employer-based program than to
25 pay the Commonwealth's share of a subsidized premium.
26 (2) This section shall apply to any employer-based
27 program, whether individual or family, such that if the
28 Commonwealth's share for the employee plus its share for any
29 spouse under the program or children under the children's
30 health insurance program is greater than the employee's
31 premium share for family coverage under the employer-based
32 program, the Commonwealth may choose to pay the latter alone
33 or in combination with providing any benefit the Commonwealth
34 does not provide through its program contracts.
35 (i) Termination of employment.--An eligible employee who is
36 terminated from employment shall be eligible to continue
37 participating in the program if the eligible employee continues
38 to meet the requirements as an eligible adult and pays any
39 increased premium required.
40 Section 1307. Health savings accounts.
41 The department shall permit the establishment of health
42 savings accounts that are actuarially equivalent to the benefits
43 in section 1313 for employees who enroll in the program. Health
44 savings accounts established under the program shall meet the
45 requirements as defined in section 223(d) of the Internal
46 Revenue Code of 1986 (Public Law 99-514, 26 U.S.C. § 223(d)).
47 Section 1308. Continuing Access with Relief for Employers
48 (CARE) grants.
49 (a) General rule.--A Continuing Access with Relief for
50 Employers (CARE) grant shall be provided to employers that meet
51 the requirements of this section.
52 (b) Eligibility.--An employer is eligible to receive a CARE
53 grant if that employer meets the following:
54 (1) has maintained coverage for at least 12 consecutive
55 months prior to the effective date of this act; or
56 (2) (i) has maintained coverage for at least 12
57 consecutive months prior to applying for the CARE grant;
58 (ii) has incurred a health care expense in this
59 Commonwealth; and
SB1137A06103 - 18 -
1 (iii) has a tax liability for the year in which
2 application is made for the CARE grant.
3 (c) Application.--Beginning July 1, 2009, and for each year
4 thereafter, an employer seeking to receive a CARE grant shall
5 submit an application to the department containing, at a
6 minimum, the following information:
7 (1) A statement of the aggregate health care expense
8 made by the employer to provide coverage during the previous
9 12 consecutive months to employees.
10 (2) The names, addresses and Social Security numbers of
11 the employees provided health care coverage under paragraph
12 (1) and whether that health care coverage is for the employee
13 or the employee and the employee's spouse and/or dependents.
14 (3) The names and addresses of the insurance carriers or
15 underwriters that received payment from the employer for the
16 health care coverage provided under paragraph (2).
17 (d) Computation.--An employer who qualifies under subsection
18 (b) shall receive a grant limited to actual employer health care
19 expenses paid for the previous 12 consecutive months in
20 accordance with the following:
21 (1) No greater than 25% of the employer's health care
22 expense to maintain health care coverage for the employee.
23 (2) No greater than 50% of the employer's health care
24 expense to maintain health care coverage for the employee,
25 the employee's spouse and/or dependents.
26 (3) The total amount of paragraphs (1) and (2) shall not
27 exceed the tax liability owed by the employer for the year
28 application is made for the CARE grant.
29 (4) If no tax liability is owed by the employer then the
30 employer may not apply for a CARE grant.
31 (e) Duties of department.--The department has the following
32 duties:
33 (1) Administer the program.
34 (2) In consultation with other appropriate Commonwealth
35 agencies:
36 (i) Develop an application for the collection of
37 information that is consistent with the requirements of
38 this section and that contains any other information that
39 may be necessary to award CARE grants.
40 (ii) Develop a process to determine the validity of
41 information collected by the department from the
42 application with information filed by the employer, the
43 employee or insurers with any other agency. This process
44 shall include guaranteeing confidentiality of employer
45 and employee information that is consistent with Federal
46 and State laws.
47 (f) Coordination.--The department shall coordinate with
48 other departments in the implementation of this section.
49 (g) Limitation on grants.--The total amount of grants
50 approved by the department shall not exceed the amount of
51 funding designated under section 762. Any application filed by
52 an employer when funding is not available shall not be
53 considered and cannot be carried forward for consideration in
54 any succeeding fiscal year.
55 (h) Lapse.--Funds not used by the department for CARE grants
56 at the end of the fiscal year shall lapse back to the Health
57 Care Provider Retention Account and be designated to the PA ABC
58 Program.
59 (i) Report to General Assembly.--The department shall submit
SB1137A06103 - 19 -
1 an annual report to the General Assembly indicating the
2 effectiveness of the program provided under this section no
3 later than March 15, 2010. The report shall include the names of
4 all the employers that received a CARE grant as of the date of
5 the report and the amount of each CARE grant approved. The
6 report may also include any recommendations for changes in the
7 calculation or administration of the CARE grant.
8 (j) Sunset.--This section shall sunset January 1, 2018.
9 (k) Definitions.--As used in this section, the following
10 words and phrases shall have the meanings given to them in this
11 subsection:
12 "CARE grant." A Continuing Access with Relief for Employers
13 (CARE) grant provided by the Department of Community and
14 Economic Development.
15 "Coverage." Health care coverage that is maintained by an
16 employer for an employee, the employee's spouse and/or
17 dependents for 12 consecutive months.
18 "Department." The Department of Community and Economic
19 Development of the Commonwealth.
20 "Employee." An individual who meets the following:
21 (1) Is employed for more than 20 hours in a single week
22 and from whose wages an employer is required under the
23 Internal Revenue Code of 1986 (Public Law 99-514, 26 U.S.C.
24 §1 et seq.) to withhold Federal income tax.
25 (2) Is at least 19 years of age but no older than 64
26 years of age.
27 (3) Legally resides within the United States.
28 (4) Has been domiciled in this Commonwealth for at least
29 90 days prior to enrollment.
30 (5) Has a household income that is no greater than 300%
31 of the Federal poverty level at the time of application.
32 "Employer." An employer that meets all of the following:
33 (1) Has at least two, but not more than 50 full-time
34 equivalent employees.
35 (2) Pays an average annual wage that is not greater than
36 300% of the Federal poverty limit for an individual.
37 "Health care coverage." A health benefit plan or other form
38 of health care coverage that is approved by the Department of
39 Community and Economic Development in consultation with the
40 Insurance Department. The term does not include coverage under
41 the PA ABC program.
42 "Health care expense." A payment made by an employer to
43 maintain health care coverage for an employee, the employee's
44 spouse and/or dependents.
45 "Program." The Continuing Access with Relief for Employers
46 (CARE) Grant Program established under this section.
47 "Tax liability." Liability under Article III, IV or VI of
48 the act of March 4, 1971 (P.L.6, No.2), known as the Tax Reform
49 Code of 1971.
50 Section 1309. Program requirements.
51 (a) Rates.--Rates for the program shall be approved annually
52 by the department and may vary by region and contractor. Rates
53 shall be based on an actuarially sound and adequate review.
54 (b) Annual premiums review.--Premiums for the program shall
55 be established annually by the department.
56 (c) Use of funding.--Funding shall be used by the department
57 to pay the difference between the total monthly cost of the
58 health benefit plan and the premium payments by the eligible
59 employee, the eligible employer or the eligible adult.
SB1137A06103 - 20 -
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 basic benefit package under
30 section 1313 through a competitive procurement process in
31 accordance with 62 Pa.C.S. (relating to procurement) and
32 subsection (g). The department may award contracts on a
33 multiple-award basis as described in 62 Pa.C.S. § 517
34 (relating to multiple awards).
35 (ii) (A) In order to effectuate the program
36 promptly upon receipt of all applicable waivers and
37 approvals from the Federal Government, the department
38 may amend such contracts as currently exist to
39 provide benefits under either the AdultBasic Program
40 or the Public Welfare Code, or may otherwise procure
41 services outside of the competitive procurement
42 process of 62 Pa.C.S.
43 (B) This subparagraph shall expire at such time
44 as there are effective contracts awarded under this
45 section in every county of this Commonwealth, but not
46 later than 18 months after the effective date of this
47 section.
48 (3) Subject to Federal requirements, impose reasonable
49 cost-sharing arrangements and encourage appropriate use by
50 contractors of cost-effective health care providers who will
51 provide quality health care by establishing and adjusting
52 copayments to be incorporated into the program by
53 contractors. The department shall forward changes of
54 copayments to the Legislative Reference Bureau for
55 publication as notices in the Pennsylvania Bulletin. The
56 changes shall be implemented by contractors as soon as
57 practicable following publication, but in no event more than
58 120 days following publication.
59 (4) In consultation with other appropriate Commonwealth
SB1137A06103 - 21 -
1 agencies, conduct monitoring and oversight of contracts
2 entered into with contractors.
3 (5) In consultation with other appropriate Commonwealth
4 agencies, monitor, review and evaluate the adequacy,
5 accessibility and availability of services delivered to
6 eligible adults or eligible employees.
7 (6) In consultation with other appropriate Commonwealth
8 agencies, establish and coordinate the development,
9 implementation and supervision of an outreach plan to ensure
10 that all those who may be eligible are aware of the program.
11 The outreach plan shall include provisions for:
12 (i) Reaching special populations, including nonwhite
13 and non-English speaking individuals and individuals with
14 disabilities.
15 (ii) Reaching different geographic areas, including
16 rural and inner-city areas.
17 (iii) Assuring that special efforts are coordinated
18 within the overall outreach activities throughout this
19 Commonwealth.
20 (7) At the request of an eligible adult, eligible
21 employee or eligible employer, facilitate the payment on a
22 pretax basis of premiums:
23 (i) for the program and dependents covered under the
24 program; or
25 (ii) if applicable, for the children's health
26 insurance program.
27 (8) Establish penalties for eligible adults, eligible
28 employees or eligible employers who enroll in the program,
29 drop enrollment and subsequently re-enroll for the purpose of
30 avoiding the ongoing payment of premiums. The commissioner
31 shall forward notice of these penalties to the Legislative
32 Reference Bureau for publication as a notice in the
33 Pennsylvania Bulletin.
34 (9) Coordinate with the Department of Public Welfare in
35 the implementation of this chapter and may designate the
36 Department of Public Welfare to perform any duties that are
37 appropriate under this chapter.
38 Section 1311. Submission of proposals and award of contracts.
39 (a) Corporations required to submit.--Each professional
40 health services plan corporation and hospital plan corporation
41 and their subsidiaries and affiliates doing business in this
42 Commonwealth shall submit a bid or proposal to the department to
43 carry out the purposes of this section in the geographic area
44 serviced by the corporation. All other insurers may submit a bid
45 or proposal to the department to carry out the purposes of this
46 section.
47 (b) Review and scoring of bids or proposals.--The
48 department shall review and score the bids or proposals on the
49 basis of all the requirements for the program. The department
50 may include other criteria in the solicitation and in the
51 scoring and selection of the bids or proposals that the
52 department, in the exercise of its duties under section 1310,
53 deems necessary. The department shall do all of the following:
54 (1) Select, to the greatest extent practicable, offerors
55 that contract with health care providers to provide health
56 care services on a cost-effective basis. The department shall
57 select offerors that use appropriate cost-management methods,
58 including the chronic care and prevention measures, which
59 will enable the program to provide coverage to the maximum
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1 number of enrollees.
2 (2) Select, to the greatest extent practicable, only
3 offerors that comply with all procedures relating to
4 coordination of benefits as required by the department and
5 the Department of Public Welfare.
6 (c) Contract terms.--Contracts may be for an initial term of
7 up to five years, with options to extend for five one-year
8 periods.
9 (d) Duties of contractors.--A contractor that contracts with
10 the department to provide a health benefit plan to eligible
11 adults or eligible employees:
12 (1) Shall process claims for the coverage.
13 (2) May not deny coverage to an eligible adult or
14 eligible employee who has been approved by the department to
15 participate in the program.
16 Section 1312. Rates and charges.
17 (a) Medical loss ratio.--The medical loss ratio for a
18 contract shall be not less than 85%.
19 (b) Limitation on fees.--No eligible adult or eligible
20 employee shall be charged a fee, other than those specified in
21 this chapter, as a requirement for participating in the program.
22 Section 1313. Health benefit plan.
23 (a) Benefits.--The health benefit plan to be offered under
24 the program shall be of the scope and duration as the department
25 determines and shall provide for all of the following, which may
26 be as limited or unlimited as the department may determine:
27 (1) Preliminary and annual health assessments.
28 (2) Emergency care.
29 (3) Inpatient and outpatient care.
30 (4) Prescription drugs, medical supplies and equipment.
31 (5) Emergency dental care.
32 (6) Maternity care.
33 (7) Skilled nursing.
34 (8) Home health and hospice care.
35 (9) Chronic disease management.
36 (10) Preventive and wellness care.
37 (11) Inpatient and outpatient behavioral health
38 services.
39 (b) Commonwealth election.--The Commonwealth may elect to
40 provide any benefit independently and outside the scope of the
41 program contracts.
42 (c) Enrollment.--Enrollment in the program may not be
43 prohibited based upon a preexisting condition, nor may a program
44 health benefit plan exclude a diagnosis or treatment for a
45 condition based upon its preexistence.
46 (d) Copayments.--The department may establish a copayment
47 for any of the services provided in the health benefit plan as
48 long as the copayment meets any Federal requirements under
49 section 1317. The department shall forward notice of the
50 copayment amounts to the Legislative Reference Bureau for
51 publication as a notice in the Pennsylvania Bulletin.
52 Section 1314. Data matching.
53 (a) Covered individuals.--All entities providing health
54 insurance or health care coverage within this Commonwealth
55 shall, not less frequently than once every month, provide the
56 names, identifying information and any additional information on
57 coverage and benefits as the department may specify for all
58 individuals for whom the entities provide insurance or coverage.
59 (b) Use of information.--
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1 (1) The department shall use information obtained in
2 subsection (a) to determine whether any portion of an
3 eligible adult's, eligible employee's or eligible employer's
4 premium is being paid from any other source and to determine
5 whether another entity has primary liability for any health
6 care claims paid under any program administered by the
7 department.
8 (2) If a determination is made that an eligible adult's,
9 eligible employee's or eligible employer's premium is being
10 paid from another source, the department may not make any
11 additional payments to the insurer for the eligible adult,
12 eligible employee or eligible employer.
13 (c) Excess payment.--If a payment has been made to an
14 insurer by the department for an eligible adult, eligible
15 employee or eligible employer for whom any portion of the
16 premium paid by the department is being paid from another
17 source, the insurer shall reimburse the department the amount of
18 any excess payment or payments.
19 (d) Reimbursement.--The department may seek reimbursement
20 from an entity that provides health insurance or health care
21 coverage that is primary to the coverage provided under any
22 program administered by the department.
23 (e) Timeliness.--To the maximum extent permitted by law and
24 notwithstanding any policy or plan provision to the contrary, a
25 claim by the department for reimbursement under subsection (c)
26 or (d) shall be deemed timely filed if it is filed with the
27 insurer or entity within three years following the date of
28 payment.
29 (f) Agreements.--The department may enter into agreements
30 with entities that provide health insurance and health care
31 coverage for the purpose of carrying out the provisions of this
32 section. The agreements shall provide for the electronic
33 exchange of data between the parties at a mutually agreed upon
34 frequency, but not less than monthly, and may also allow for
35 payment of a fee by the department to the entity providing
36 health insurance or health care coverage.
37 (g) Other coverage.--
38 (1) The department shall determine whether any other
39 health care coverage is available to an eligible adult,
40 eligible employee or eligible employer through an alimony
41 agreement or an employment-related or other group basis.
42 (2) If other health care coverage is available, the
43 department shall reevaluate the enrollee's eligibility under
44 this chapter.
45 (h) Penalty.--
46 (1) The department may impose a penalty of up to $1,000
47 per violation on any insurer that fails to comply with the
48 obligations imposed by this chapter.
49 (2) All moneys collected under this subsection shall be
50 deposited into the fund.
51 Section 1315. Entitlements and claims.
52 Nothing in this chapter shall be construed as an entitlement
53 derived from the Commonwealth or a claim on any funds of the
54 Commonwealth. The Department of Public Welfare, in conjunction
55 with the department, shall establish a waiting list and State
56 plan amendments and revisions to Federal waivers as are
57 necessary to ensure that expenditures in the program do not
58 exceed available funding.
59 Section 1316. Regulations.
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1 The department may promulgate regulations for the
2 implementation and administration of this chapter.
3 Section 1317. Federal waivers.
4 (1) The Department of Public Welfare, in cooperation
5 with the department, shall apply for all applicable waivers
6 from the Federal Government and shall seek approval to amend
7 the State plan as necessary to carry out the provisions of
8 this chapter.
9 (2) If the Department of Public Welfare receives
10 approval of a waiver or approval of a State plan amendment as
11 required by this section, it shall notify the department and
12 transmit notice of the waiver or State plan amendment
13 approvals to the Legislative Reference Bureau for publication
14 as a notice in the Pennsylvania Bulletin.
15 (3) The department may change the benefits under section
16 1313 and the premium and copayment amounts payable under
17 sections 1305 and 1306 and eligibility requirements in order
18 for the program to meet Federal requirements.
19 Section 1318. Federal funds.
20 Notwithstanding any other provision of law, the Department of
21 Public Welfare, in cooperation with the department, shall take
22 any action necessary to do all of the following:
23 (1) Ensure the receipt of Federal financial
24 participation under Title XIX of the Social Security Act (49
25 Stat. 620, 42 U.S.C. § 1396 et seq.) for coverage and for
26 services provided under this chapter.
27 (2) Qualify for available Federal financial
28 participation under Title XIX of the Social Security Act.
29 Section 12. The Insurance Department shall publish a notice
30 in the Pennsylvania Bulletin when a law is enacted that provides
31 for or designates at least $120,000,000 for the Supplemental
32 Assistance and Funding Account.
33 Section 13. Repeals are as follows:
34 (1) The General Assembly declares that the repeal under
35 paragraph (2) is necessary to effectuate this act.
36 (2) Chapter 13 of the act of June 26, 2001 (P.L.755,
37 No.77), known as the Tobacco Settlement Act.
38 (3) All other acts and parts of acts are repealed
39 insofar as they are inconsistent with this act.
40 Section 14. The amendment of section 712(e) of the act shall
41 apply retroactively to December 31, 2007.
42 Section 15. This act shall take effect as follows:
43 (1) The following provisions shall take effect July 1,
44 2008, or immediately, whichever is later:
45 (i) The amendment of section 712(e) and (m) of the
46 act.
47 (ii) The amendment of the definition of "health care
48 provider" in section 1101 of the act.
49 (iii) The amendment of section 1112 of the act.
50 (iv) Section 12 of this act.
51 (2) The remainder of this act shall take effect upon
52 publication of the notice specified under section 12 of this
53 act.
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