Report Title:

Health Plan Payments; Critical Access Hospitals; Federally Qualified Health Centers

 

Description:

Requires commercial health plans licensed to do business in the State to pay no less than 101% of costs for all services provided to plan beneficiaries by critical access hospitals and federally qualified health centers.

 


THE SENATE

S.B. NO.

1140

TWENTY-FIFTH LEGISLATURE, 2009

 

STATE OF HAWAII

 

 

 

 

 

A BILL FOR AN ACT

 

 

relating to health care.

 

 

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

 


     SECTION 1.  The legislature finds that rural hospitals and federally qualified health centers are essential to the State's health care system.  All health care providers are hurt by low reimbursement rates, but rural hospital facilities and publicly supported health centers that serve economically disadvantaged persons are especially disadvantaged because of the high cost of providing care in remote areas with low patient volume and of providing comprehensive care to underserved populations with complex health and socio-economic needs.  In recognition of these difficulties, the federal government created critical access hospitals and federally qualified health centers to assist states in improving access to essential health care services. 

Critical access hospitals and federally qualified health centers serve consumers who are covered under the medicare and medicaid programs as well as those with other types of health coverage.  State and federal law determine the reimbursement rates for medicare and medicaid provided services.  The federal Department of Health and Human Services, through the Center for Medicare and Medicaid Services, pays critical access hospitals one hundred and one per cent of costs for acute care service to medicare recipients.  The Hawaii department of human services also calculates payments to critical access hospitals for services to medicaid beneficiaries based on the actual cost of the service.  Pursuant to state and federal law, reimbursements for medicaid services reflect both an estimated average cost and the actual cost of providing services, with the State making up the difference between managed care payments and the federal reimbursement rate. 

The purpose of this Act is to require health plans, other than government payors, licensed to do business in this State, to reimburse critical access hospitals and federally qualified health centers at rates consistent with medicare and medicaid reimbursement rates. 

     SECTION 2.  Chapter 431, article 10A, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

     "§431:10A-    Cost-based payments to critical access hospitals and federally qualified health centers.  (a)  Health insurers other than government payors shall reimburse critical access hospitals as defined in section 346D-1 at a rate not less than one hundred and one per cent of costs, consistent with the medicare reimbursement rate, for all services rendered to health plan beneficiaries. 

     (b)  Health insurers other than government payors shall pay federally qualified health centers as defined in section 1905(l) of the Social Security Act (42 USC 1396d) no less than their respective prospective payment system rates determined pursuant to sections 346-53.6 to 346-53.64. 

     (c)  Nothing in this section shall be construed to determine a maximum amount that a health insurer other than a government payor may pay to a critical access hospital or federally qualified health center for services to plan beneficiaries. 

     (d)  The commissioner may adopt administrative rules pursuant to chapter 91 to effectuate the purpose of this section.  The commissioner may require health insurers other than government payors to annually demonstrate compliance with this section, including validation of payment rates in accordance with medicare interim rate letters.  

     The commissioner may require critical access hospitals and federally qualified health centers to provide information as requested by the commissioner to clarify, supplement, or rebut information supplied by a health insurer; provided that the release of information by a critical access hospital or federally qualified health center shall be subject to the provisions of the Health Insurance Portability and Accountability Access Act of 1996.

     (e)  As used in this section:

     "Government payor" means a state or federal government entity that provides medical assistance in the form of payment or reimbursement to a health care provider for the cost of providing health care to an enrollee, or a nongovernmental party contracted by a government entity to do so."

     SECTION 3.  Chapter 432, article 1, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

     "§432:1-    Cost-based payments to critical access hospitals and federally qualified health centers.  (a)  Mutual benefit societies shall reimburse critical access hospitals as defined in section 346D-1 at a rate not less than one hundred and one per cent of costs, consistent with the medicare reimbursement rate, for all services rendered to health plan beneficiaries. 

     (b)  Mutual benefit societies shall pay federally qualified health centers as defined in section 1905(l) of the Social Security Act (42 USC 1396d) no less than their respective prospective payment system rates determined pursuant to sections 346-53.6 to 346-53.64. 

     (c)  Nothing in this section shall be construed to determine a maximum amount that a mutual benefit society may pay to a critical access hospital or federally qualified health center for services to plan beneficiaries. 

     (d)  The commissioner may adopt administrative rules pursuant to chapter 91 to effectuate the purpose of this section.  The commissioner may require mutual benefit societies to annually demonstrate compliance with this section, including validation of payment rates in accordance with medicare interim rate letters. 

     The commissioner may require critical access hospitals and federally qualified health centers to provide information as requested by the commissioner to clarify, supplement, or rebut information supplied by a mutual benefit society; provided that the release of information by a critical access hospital or federally qualified health center shall be subject to the provisions of the Health Insurance Portability and Accountability Access Act of 1996."

     SECTION 4.  Chapter 432, article 2, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

     "§432:2-    Cost-based payments to critical access hospitals and federally qualified health centers.  (a)  Fraternal benefit societies shall reimburse critical access hospitals as defined in section 346D-1 at a rate not less than one hundred and one per cent of costs, consistent with the medicare reimbursement rate, for all services rendered to health plan beneficiaries. 

     (b)  Fraternal benefit societies shall pay federally qualified health centers as defined in section 1905(l) of the Social Security Act (42 USC 1396d) no less than their respective prospective payment system rates determined pursuant to sections 346-53.6 to 346-53.64. 

     (c)  Nothing in this section shall be construed to determine a maximum amount that a fraternal benefit society may pay to a critical access hospital or federally qualified health center for services to plan beneficiaries. 

     (d)  The commissioner may adopt administrative rules pursuant to chapter 91 to effectuate the purpose of this section.  The commissioner may require fraternal benefit societies to annually demonstrate compliance with this section, including validation of payment rates in accordance with medicare interim rate letters. 

     The commissioner may require critical access hospitals and federally qualified health centers to provide information as requested by the commissioner to clarify, supplement, or rebut information supplied by a fraternal benefit society; provided that the release of information by a critical access hospital or federally qualified health center shall be subject to the provisions of the Health Insurance Portability and Accountability Access Act of 1996."

     SECTION 5.  Chapter 432D, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

     "§432D-    Cost-based payments to critical access hospitals and federally qualified health centers.  (a)  Health maintenance organizations other than government payors shall reimburse critical access hospitals as defined in section 346D-1 at a rate not less than one hundred and one per cent of costs, consistent with the medicare reimbursement rate, for all services rendered to health plan beneficiaries. 

     (b)  Health maintenance organizations other than government payors shall pay federally qualified health centers as defined in section 1905(l) of the Social Security Act (42 USC 1396d) no less than their respective prospective payment system rates determined pursuant to sections 346-53.6 to 346-53.64. 

     (c)  Nothing in this section shall be construed to determine a maximum amount that a health maintenance organization other than a government payor may pay to a critical access hospital or federally qualified health center for services to plan beneficiaries. 

     (d)  The commissioner may adopt administrative rules pursuant to chapter 91 to effectuate the purpose of this section.  The commissioner may require health maintenance organizations other than government payors to annually demonstrate compliance with this section, including validation of payment rates in accordance with medicare interim rate letters. 

     The commissioner may require critical access hospitals and federally qualified health centers to provide information as requested by the commissioner to clarify, supplement, or rebut information supplied by a health maintenance organization other than a government payor; provided that the release of information by a critical access hospital or federally qualified health center shall be subject to the provisions of the Health Insurance Portability and Accountability Access Act of 1996.

     (e)  As used in this section:

"Government payor" means a state or federal government entity that provides medical assistance in the form of reimbursement to a health care provider for the cost of providing health care to an enrollee, or a nongovernmental party contracted by a government entity to do so."

     SECTION 6.  New statutory material is underscored.

     SECTION 7.  This Act shall take effect on July 1, 2009.

 

INTRODUCED BY:

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