REPORT TITLE:
Managed Care


DESCRIPTION:
Implements the recommendations of the patient rights and
responsibilities task force to strengthen the Hawaii patient bill
of rights and responsibilities act and related laws.
(SB1452 HD3)

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
                                                        1452
THE SENATE                              S.B. NO.           H.D. 3
TWENTIETH LEGISLATURE, 1999                                
STATE OF HAWAII                                            
                                                             
________________________________________________________________
________________________________________________________________


                     A BILL FOR AN ACT

RELATING TO HEALTH.



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

 1      SECTION 1.  Act 178, Session Laws of Hawaii 1998, enacted
 
 2 the Hawaii Patient Bill of Rights and Responsibilities Act to
 
 3 regulate managed care.  Act 178 also required the insurance
 
 4 commissioner to convene a task force to review various laws
 
 5 providing protection of patient rights and responsibilities with
 
 6 regard to health care, especially managed care.  This Act
 
 7 contains the statutory revisions recommended by the task force to
 
 8 ensure the protection of consumer rights.
 
 9      The purpose of this Act is to strengthen the protection of
 
10 the consumer rights of patients receiving health care under
 
11 managed care plans and from health maintenance organizations.
 
12      SECTION 2.  Chapter 432E, Hawaii Revised Statutes, is
 
13 amended by adding four new sections to be appropriately
 
14 designated and to read as follows:
 
15      "432E-A  Annual report.  The commissioner shall submit
 
16 annually to the legislature a report that shall contain the
 
17 number of external review hearing cases reviewed, the type of
 
18 cases reviewed, a summary of the nature of the cases reviewed,
 

 
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 1 and the disposition of the cases reviewed.  The identities of the
 
 2 plan and the enrollee shall be protected from disclosure in the
 
 3 report.
 
 4      432E-B  Health insurance revolving fund.  (a)  There is
 
 5 established a revolving fund in the state treasury to be
 
 6 administered by the commissioner and to be designated as the
 
 7 health insurance revolving fund.  All assessments imposed under
 
 8 subsection (c) as well as other fees, assessments, fines, and
 
 9 penalties imposed by the commissioner under this chapter shall be
 
10 deposited into this fund.
 
11      (b)  The commissioner may expend moneys from the health
 
12 insurance revolving fund to hire medical experts to serve on a
 
13 review panel under section 432E-6(a), provide an expert medical
 
14 opinion to the review panel, or conduct a public awareness and
 
15 education program about managed care plans under section
 
16 432E-C(b).
 
17      (c)  Beginning July 1, 1999, and each year thereafter, every
 
18 mutual benefit society, every health maintenance organization,
 
19 and every other entity offering or providing health benefits or
 
20 services under the regulation of the commissioner, except an
 
21 insurer licensed to offer health insurance under article 10A,
 
22 shall deposit with the commissioner by July 1 of each year an
 
23 assessment imposed by the commissioner on a pro rata basis.
 

 
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 1      (d)  Moneys in the health insurance revolving fund shall not
 
 2 revert to the general fund.
 
 3      (e)  The commissioner shall report annually to the
 
 4 legislature before the convening of each regular session on fund
 
 5 administration and expenditures.
 
 6      432E-C  Accreditation of managed care plans.  (a)
 
 7 Beginning January 1, 1999, the commissioner shall contract with
 
 8 one or more certified vendors of the consumer assessment health
 
 9 plan survey to conduct a survey and educational program of all
 
10 managed care plans actively offering managed care plans in this
 
11 State to provide managed care plans an opportunity to learn
 
12 whether any deficiencies exist or any improvements are required;
 
13 provided that the information collected shall be kept
 
14 confidential in the first year, and thereafter shall be available
 
15 to the public.
 
16      (b)  The commissioner shall conduct a program that promotes
 
17 public awareness and education about managed care plans so that
 
18 consumers may make better or more informed choices when selecting
 
19 a managed care plan.
 
20      (c)  Beginning January 1, 2000, unaccredited plans shall
 
21 submit a plan to the commissioner to achieve national
 
22 accreditation status within five years.  After the first year of
 
23 the five-year plan, each unaccredited plan shall also submit an
 

 
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 1 annual progress report to the commissioner on the status of
 
 2 gaining national accreditation.  The commissioner shall determine
 
 3 which national accreditation organization is appropriate for each
 
 4 type of plan.
 
 5      (d)  Every mutual benefit society, every health maintenance
 
 6 organization, and every other entity offering or providing health
 
 7 benefits or services under the regulation of the commissioner,
 
 8 except an insurer licensed to offer health insurance under
 
 9 article 10A of chapter 431, shall deposit with the commissioner a
 
10 fee to provide for the actual costs of the survey and educational
 
11 program to be determined by the commissioner on July 1 of each
 
12 year, to be credited to the health insurance revolving fund.  In
 
13 addition, every mutual benefit society, every health maintenance
 
14 organization, and every other entity offering or providing health
 
15 benefits or services under the regulation of the commissioner,
 
16 except an insurer licensed to offer health insurance under
 
17 article 10A of chapter 431, shall pay to the commissioner at a
 
18 time to be determined by the commissioner, a one-time assessment
 
19 in an amount to be determined by the commissioner, to be credited
 
20 to the health insurance revolving fund.
 
21      432E-D  Rules.  The commissioner shall adopt rules pursuant
 
22 to chapter 91 necessary for the purposes of this chapter."
 

 
 
 
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 1      SECTION 3.  Section 432E-1, Hawaii Revised Statutes, is
 
 2 amended by adding four new definitions to be appropriately
 
 3 inserted and to read as follows:
 
 4      ""Emergency medical condition" means a medical condition
 
 5 that manifests itself by acute symptoms of sufficient severity,
 
 6 including severe pain, that a prudent layperson, who possesses an
 
 7 average knowledge of health and medicine, could reasonably expect
 
 8 the absence of immediate medical attention to result in:
 
 9      (1)  Placing the health of the individual, including the
 
10           health of a pregnant woman or her unborn child, in
 
11           serious jeopardy;
 
12      (2)  Serious impairment to bodily functions; or
 
13      (3)  Serious dysfunction of any bodily organ or part.
 
14      "Emergency services" means:
 
15      (1)  A medical screening examination, if required by federal
 
16           law, that is within the capability of the emergency
 
17           department of a hospital, including ancillary services
 
18           routinely available to the emergency department, to
 
19           evaluate an emergency medical condition; or
 
20      (2)  Further medical examination and treatment, if required
 
21           by federal law, that is within the capabilities of the
 
22           staff and facilities available at the hospital,
 
23           including any trauma and burn center of the hospital to
 
24           stabilize an emergency medical condition.
 

 
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 1      "Mutual benefit society" has the same meaning as in article
 
 2 1 of chapter 432.
 
 3      "Stabilize" means the provision of medical treatment as may
 
 4 be necessary to assure, within reasonable medical probability,
 
 5 that no material deterioration of an individual's medical
 
 6 condition is likely to result from or occur during a transfer to
 
 7 another facility, if the medical condition could result in
 
 8 placing the health of the individual or the health of a pregnant
 
 9 woman or her unborn child in serious jeopardy, serious impairment
 
10 to bodily functions, or serious dysfunction of any bodily organ
 
11 or part."
 
12      SECTION 4.  Section 432E-3, Hawaii Revised Statutes, is
 
13 amended to read as follows:
 
14      "[[]432E-3[]]  Access to services.  A managed care plan
 
15 shall demonstrate to the commissioner upon request that its plan:
 
16      (1)  Makes benefits available and accessible to each
 
17           enrollee electing the managed care plan in the defined
 
18           service area with reasonable promptness and in a manner
 
19           which promotes continuity in the provision of health
 
20           care services;
 
21      (2)  Provides access to sufficient numbers and types of
 
22           providers to ensure that all covered services will be
 
23           accessible without unreasonable delay;
 

 
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 1      (3)  When medically necessary, provides health care services
 
 2           twenty-four hours a day, seven days a week;
 
 3      (4)  Provides a reasonable choice of qualified providers of
 
 4           women's health services such as gynecologists,
 
 5           obstetricians, certified nurse-midwives, and advanced
 
 6           practice nurses to provide preventive and routine
 
 7           women's health care services; [and]
 
 8      (5)  Provides payment or reimbursement for adequately
 
 9           documented emergency services[.] as provided in this
 
10           chapter; and
 
11      (6)  Allows standing referrals to specialists capable of
 
12           providing and coordinating primary and specialty care
 
13           for an enrollee's life-threatening, chronic,
 
14           degenerative, or disabling disease or condition."
 
15      SECTION 4.  Section 432E-5, Hawaii Revised Statutes, is
 
16 amended to read as follows:
 
17      "[[]432E-5[]]  Complaints and appeals procedure for
 
18 enrollees.(a)  A managed care plan with enrollees in this State
 
19 shall establish and maintain a procedure to provide for the
 
20 resolution of an enrollee's complaints and appeals.
 
21      (b)  The managed care plan at all times shall make available
 
22 its complaints and appeals procedures.  The complaints and
 
23 appeals procedures shall be reasonably understandable to the
 

 
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 1 average layperson and shall be provided in languages other than
 
 2 English upon request.
 
 3      (c)  A managed care plan shall send notice of its final
 
 4 internal determination to the enrollee, the enrollee's appointed
 
 5 representative, if applicable, and the commissioner.  The notice
 
 6 shall include information regarding the enrollee's rights and
 
 7 procedures under section 432E-6."
 
 8      SECTION 5.  Section 432E-6, Hawaii Revised Statutes, is
 
 9 amended to read as follows:
 
10      "[[]432E-6[]]  Appeals to the commissioner.(a)  After
 
11 exhausting all internal complaint and appeal procedures
 
12 available, an enrollee, or the enrollee's treating provider or
 
13 appointed representative, may appeal an adverse decision of a
 
14 managed care plan to a [three member] three-member review panel
 
15 appointed by the commissioner composed of a representative from a
 
16 health plan not involved in the complaint, a provider licensed to
 
17 practice and practicing medicine in Hawaii not involved in the
 
18 complaint, and the commissioner or the commissioner's designee in
 
19 the following manner:
 
20      (1)  The enrollee shall submit a request for review to the
 
21           commissioner within thirty days from the date of the
 
22           final determination by the managed care plan[.];
 

 
 
 
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 1      (2)  Upon receipt of the request and upon a showing of good
 
 2           cause, the commissioner shall appoint the members of
 
 3           the panel and shall conduct a review hearing pursuant
 
 4           to chapter 91.  If the amount in controversy is less
 
 5           than $500, the commissioner may conduct a review
 
 6           hearing without appointing a review panel;
 
 7      (3)  The review hearing shall be conducted as soon as
 
 8           practicable, taking into consideration the medical
 
 9           exigencies of the case; provided that the hearing shall
 
10           be held no later than sixty days from the date of the
 
11           request for the hearing;
 
12      (4)  The commissioner may retain, without regard to chapters
 
13           76 and 77, an independent medical expert trained in the
 
14           field of medicine most appropriately related to the
 
15           matter under review.  Presentation of evidence for this
 
16           purpose shall be exempt from chapter 91;
 
17     [(3)] (5) After considering the enrollee's complaint, the
 
18           plan's response, and any affidavits filed by the
 
19           parties, the commissioner may dismiss the appeal if it
 
20           is determined that the appeal is frivolous or without
 
21           merit[.]; and
 

 
 
 
 
 
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 1      (6)  The review panel shall review every adverse
 
 2           determination to determine whether or not the plan
 
 3           involved acted reasonably and with sound medical
 
 4           judgment.  The review panel shall consider the clinical
 
 5           standards of the plan, the information provided, the
 
 6           attending physician's recommendations, and generally
 
 7           accepted practice guidelines.
 
 8      The commissioner, upon a majority vote of the panel, shall
 
 9 issue an order affirming, modifying, or reversing the decision
 
10 within thirty days of the hearing.
 
11      (b)  The procedure set forth in this section shall not apply
 
12 to claims or allegations of health provider malpractice,
 
13 professional negligence, or other professional fault against
 
14 participating providers.
 
15      [(c)  The commissioner may adopt rules pursuant to chapter
 
16 91 to carry out the purposes of this section.]
 
17      (c)  Members of the review panel shall be granted immunity
 
18 from liability and damages relating to their duties under this
 
19 section.
 
20      (d)  An enrollee may be allowed an award of a reasonable sum
 
21 for attorney's fees and reasonable costs of suit in an action
 
22 brought against the managed care plan."
 

 
 
 
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 1      SECTION 6.  Section 432E-7, Hawaii Revised Statutes, is
 
 2 amended to read as follows:
 
 3      "[[]432E-7[]]  Information to enrollees.  (a)  The managed
 
 4 care plan shall provide to its enrollees upon enrollment and
 
 5 thereafter upon request the following information:
 
 6      (1)  A list of participating providers which shall [indicate
 
 7           their specialty and whether board certification has
 
 8           been attained;] be updated on a regular basis
 
 9           indicating, at a minimum, their specialty and whether
 
10           the provider is accepting new patients;
 
11      (2)  A complete description of benefits, services, and
 
12           copayments;
 
13      (3)  A statement on enrollee's rights, responsibilities, and
 
14           obligations;
 
15      (4)  An explanation of the referral process, if any;
 
16      (5)  Where services or benefits may be obtained;
 
17     [(6)  A statement regarding informed consent;
 
18      (7)] (6)  Information on complaints and appeals procedures;
 
19           and
 
20     [(8)] (7)  The telephone number of the insurance division
 
21           [and the office of consumer complaints].
 
22 This information shall be provided to prospective enrollees upon
 
23 request.
 

 
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 1      (b)  Every managed care plan shall provide to the
 
 2 commissioner and its enrollees notice of any material change in
 
 3 [the operation of the organization initiated by the plan that
 
 4 will affect them directly within thirty days of the material
 
 5 change.] participating provider agreements, services, or
 
 6 benefits, if the change affects the organization or operation of
 
 7 the managed care plan and the enrollee's services or benefits.
 
 8 The managed care plan shall provide notice to enrollees not more
 
 9 than sixty days after the change in a format that makes the
 
10 notice clear and conspicuous so that it is readily noticeable by
 
11 the enrollee.
 
12      [(c)  For purposes of this section "material change" means a
 
13 change in participating provider agreements, services, or
 
14 benefits.]
 
15      (c)  A managed care plan shall provide generic participating
 
16 provider contracts to enrollees, upon request."
 
17      SECTION 7.  Section 432E-10, Hawaii Revised Statutes, is
 
18 amended to read as follows:
 
19      "[[]432E-10[]]  Managed care plan performance measurement
 
20 and data reporting standards.(a)  It is the policy of this
 
21 State that all managed care plans shall adopt and comply with
 
22 nationally developed and promulgated standards for measuring
 
23 quality, outcomes, access, satisfaction, and utilization of
 

 
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 1 services.  Every contract between a managed care plan and a
 
 2 participating provider of health care services shall require the
 
 3 participating provider to comply with the managed care plan's
 
 4 requests for any information necessary for the managed care plan
 
 5 to comply with the requirements of this chapter.  [The standard
 
 6 to be applied is the Health Employer Data and Information Set
 
 7 (HEDIS) 3.0 data set, as amended from time to time.]  The State
 
 8 shall require that:
 
 9      (1)  Consumers, providers, managed care plans, purchasers,
 
10           and regulators shall be equitably represented in the
 
11           development of standards; and
 
12      (2)  Standards shall result in measurement and reporting
 
13           that is purposeful, valid, and scientifically based,
 
14           applied in a consistent and comparable manner,
 
15           efficient and cost effective, and designed to minimize
 
16           redundancy and duplication of effort.
 
17      (b)  All managed care plans, no less than annually, shall
 
18 report to the commissioner comparable information on performance,
 
19 including measures of quality, outcomes, access, satisfaction,
 
20 and utilization of services; provided that:
 
21      (1)  Reporting shall be based upon a core data and
 
22           information set that builds upon nationally recognized
 
23           performance measurement systems.  The core data and
 

 
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 1           information set shall include standardized measures of:
 
 2           (A)  Effectiveness and appropriateness of care (the
 
 3                impact of care delivered to managed care plan
 
 4                enrollees, [including] for example, results of the
 
 5                plan for childhood immunizations, cholesterol
 
 6                screening, mammography screening, cervical cancer
 
 7                screening, prenatal visits in the first trimester
 
 8                of pregnancy, and diabetic retinal examinations);
 
 9           (B)  Access and availability of care (the extent to
 
10                which plan enrollees have access to the health
 
11                care providers they need or desire to see, and
 
12                receive appropriate services in a timely manner,
 
13                without inappropriate barriers or inconvenience);
 
14           (C)  Satisfaction with the experience of care (the
 
15                results of the most recent enrollee satisfaction
 
16                survey using standardized survey design and
 
17                methods);
 
18           (D)  Managed care plan stability (attributes of a
 
19                managed care plan which affect its ability to
 
20                deliver high-quality care and service on a
 
21                sustained basis);
 
22           (E)  Use of services (rates of service use per [1,000]
 
23                one thousand enrollees as well as percentages of
 
24                enrollees who receive specified services);
 

 
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 1           (F)  Cost of care (expenditures per enrollee per month,
 
 2                premium rates for selected membership categories,
 
 3                and rates of increases); and
 
 4           (G)  Managed care plan descriptive information (the
 
 5                plan name, location of headquarters, and number of
 
 6                years the plan has been in business; the model
 
 7                type of the plan; the counties in which the plan
 
 8                operates; the total number of participating
 
 9                physicians per [1,000] one thousand enrollees and
 
10                the number of primary care physicians per [1,000]
 
11                one thousand enrollees; the number of
 
12                participating hospitals per [10,000] ten thousand
 
13                enrollees; the percentage of participating
 
14                physicians who are board certified; and a list of
 
15                wellness and health care education programs
 
16                offered by the plan);
 
17      (2)  Information shall be uniformly reported by managed care
 
18           plans in a standardized format, as determined by rule;
 
19      (3)  Information supplied by managed care plans shall be
 
20           subject to independent audit by the appropriate
 
21           regulatory agency or its designee to verify accuracy
 
22           and protect against misrepresentation;
 

 
 
 
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 1      (4)  Information reported by managed care plans shall be
 
 2           adjusted, based on standardized methods, to control for
 
 3           the effects of differences in health risk, severity of
 
 4           illness, or mix of services;
 
 5      (5)  A managed care plan shall ensure confidentiality of
 
 6           records and shall not disclose individually
 
 7           identifiable data or information pertaining to the
 
 8           diagnosis, treatment, or health of any enrollee, except
 
 9           as provided under law; and
 
10      (6)  A managed care plan shall disclose to its enrollees the
 
11           quality and satisfaction assessments used, including
 
12           the current results of the assessments."
 
13      SECTION 8.  Section 1 of Act 246, Session Laws of Hawaii
 
14 1998, is amended by amending subsection (f) of the new section
 
15 added to article 10A of chapter 431, Hawaii Revised Statutes, to
 
16 read as follows: 
 
17      "(f)  A health plan shall reimburse an emergency provider
 
18 and an emergency department for any items or services not
 
19 necessary to stabilize the patient [but that] under at least one
 
20 of the following:
 
21      (1)  The items or services are determined to be medically
 
22           necessary to treat the illness that [lead] led the
 
23           patient to believe that [he or she] the patient had an
 

 
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 1           emergency medical condition, and that a reasonable
 
 2           patient would expect to receive such items or services
 
 3           from a physician at the time of presentation[.]; or
 
 4      (2)  The items or services are determined to be medically
 
 5           necessary by the emergency provider, if the emergency
 
 6           department:
 
 7           (A)  After a documented good faith effort, is unable to
 
 8                reach the enrollee's health plan:
 
 9                (i)  Within thirty minutes from the initial
 
10                     examination of the enrollee; or
 
11               (ii)  If the enrollee needs to be stabilized,
 
12                     within thirty minutes of stabilization;
 
13           (B)  Has successfully contacted the plan as required in
 
14                subparagraph (A), and has not received a denial
 
15                from the plan within thirty minutes of the initial
 
16                contact, unless the plan is able to document that
 
17                it has made an unsuccessful good faith effort to
 
18                reach the emergency department within thirty
 
19                minutes after receiving the request for
 
20                authorization; or
 
21           (C)  Has successfully contacted the plan and has
 
22                received a denial from a person other than a
 
23                participating physician and:
 

 
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 1                (i)  A participating physician authorized by the
 
 2                     plan to review denials reverses the denial;
 
 3                     or
 
 4               (ii)  A participating physician authorized by the
 
 5                     plan to review denials fails to communicate a
 
 6                     determination affirming the denial (unless
 
 7                     the treating physician waives the requirement
 
 8                     for such determination), within thirty
 
 9                     minutes after the initial denial is
 
10                     communicated by the plan.
 
11      A health plan shall immediately arrange for an alternate
 
12 plan of treatment for the member if a non-participating emergency
 
13 provider and the plan are unable to reach agreement on services
 
14 necessary beyond those immediately needed to stabilize the
 
15 member, under which:
 
16           (A)  A participating physician with privileges at the
 
17                hospital arrives at the emergency department of
 
18                the hospital promptly and assumes responsibility
 
19                for the treatment of the member; or
 
20           (B)  With the agreement of the treating physician or
 
21                another health professional in the emergency
 
22                department:
 

 
 
 
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 1                (i)  Arrangement is made for transfer of the
 
 2                     member to another facility using medical
 
 3                     resources consistent with the condition of
 
 4                     the enrollee;
 
 5               (ii)  An appointment is made with a participating
 
 6                     physician or provider for treatment needed by
 
 7                     the enrollee; or
 
 8              (iii)  Another arrangement is made for treatment of
 
 9                     the enrollee."
 
10      SECTION 9.  Section 2 of Act 246, Session Laws of Hawaii
 
11 1998, is amended by amending subsection (f) of the new section
 
12 added to article 1 of chapter 432, Hawaii Revised Statutes, to
 
13 read as follows:
 
14      "(f)  A health plan shall reimburse an emergency provider
 
15 and an emergency department for any items or services not
 
16 necessary to stabilize the patient [but that] under at least one
 
17 of the following:
 
18      (1)  The items or services are determined to be medically
 
19           necessary to treat the illness that [lead] led the
 
20           patient to believe that [he or she] the patient had an
 
21           emergency medical condition, and that a reasonable
 
22           patient would expect to receive such items or services
 
23           from a physician at the time of presentation[.]; or
 

 
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 1      (2)  The items or services are determined to be medically
 
 2           necessary by the emergency provider, if the emergency
 
 3           department:
 
 4           (A)  After a documented good faith effort, is unable to
 
 5                reach the enrollee's health plan:
 
 6                (i)  Within thirty minutes from the initial
 
 7                     examination of the enrollee; or
 
 8               (ii)  If the enrollee needs to be stabilized,
 
 9                     within thirty minutes of stabilization;
 
10           (B)  Has successfully contacted the plan as required in
 
11                subparagraph (A), and has not received a denial
 
12                from the plan within thirty minutes of the initial
 
13                contact, unless the plan is able to document that
 
14                it has made an unsuccessful good faith effort to
 
15                reach the emergency department within thirty
 
16                minutes after receiving the request for
 
17                authorization; or
 
18           (C)  Has successfully contacted the plan and has
 
19                received a denial from a person other than a
 
20                participating physician and:
 
21                (i)  A participating physician authorized by the
 
22                     plan to review denials reverses the denial;
 
23                     or
 

 
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 1               (ii)  A participating physician authorized by the
 
 2                     plan to review denials fails to communicate a
 
 3                     determination affirming the denial (unless
 
 4                     the treating physician waives the requirement
 
 5                     for such determination), within thirty
 
 6                     minutes after the initial denial is
 
 7                     communicated by the plan.
 
 8      A health plan shall immediately arrange for an alternate
 
 9 plan of treatment for the member if a non-participating emergency
 
10 provider and the plan are unable to reach agreement on services
 
11 necessary beyond those immediately needed to stabilize the
 
12 member, under which:
 
13           (A)  A participating physician with privileges at the
 
14                hospital arrives at the emergency department of
 
15                the hospital promptly and assumes responsibility
 
16                for the treatment of the member; or
 
17           (B)  With the agreement of the treating physician or
 
18                another health professional in the emergency
 
19                department:
 
20                (i)  Arrangement is made for transfer of the
 
21                     member to another facility using medical
 
22                     resources consistent with the condition of
 
23                     the enrollee;
 

 
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                                     S.B. NO.           H.D. 3
                                                        
                                                        

 
 1               (ii)  An appointment is made with a participating
 
 2                     physician or provider for treatment needed by
 
 3                     the enrollee; or
 
 4              (iii)  Another arrangement is made for treatment of
 
 5                     the enrollee."
 
 6      SECTION 10.  Section 3 of Act 246, Session Laws of Hawaii
 
 7 1998, is amended by amending subsection (f) of the new section
 
 8 added to chapter 432D, Hawaii Revised Statutes, to read as
 
 9 follows:
 
10      "(f)  A health plan shall reimburse an emergency provider
 
11 and an emergency department for any items or services not
 
12 necessary to stabilize the patient [but that] under at least one
 
13 of the following:
 
14      (1)  The items or services are determined to be medically
 
15           necessary to treat the illness that [lead] led the
 
16           patient to believe that [he or she] the patient had an
 
17           emergency medical condition, and that a reasonable
 
18           patient would expect to receive such items or services
 
19           from a physician at the time of presentation[.]; or
 
20      (2)  The items or services are determined to be medically
 
21           necessary by the emergency provider, if the emergency
 
22           department:
 

 
 
 
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 1           (A)  After a documented good faith effort, is unable to
 
 2                reach the enrollee's health plan:
 
 3                (i)  Within thirty minutes from the initial
 
 4                     examination of the enrollee; or
 
 5               (ii)  If the enrollee needs to be stabilized,
 
 6                     within thirty minutes of stabilization;
 
 7           (B)  Has successfully contacted the plan as required in
 
 8                subparagraph (A), and has not received a denial
 
 9                from the plan within thirty minutes of the initial
 
10                contact, unless the plan is able to document that
 
11                it has made an unsuccessful good faith effort to
 
12                reach the emergency department within thirty
 
13                minutes after receiving the request for
 
14                authorization; or
 
15           (C)  Has successfully contacted the plan and has
 
16                received a denial from a person other than a
 
17                participating physician and:
 
18                (i)  A participating physician authorized by the
 
19                     plan to review denials reverses the denial;
 
20                     or
 
21               (ii)  A participating physician authorized by the
 
22                     plan to review denials fails to communicate a
 
23                     determination affirming the denial (unless
 

 
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 1                     the treating physician waives the requirement
 
 2                     for such determination), within thirty
 
 3                     minutes after the initial denial is
 
 4                     communicated by the plan.
 
 5      A health plan shall immediately arrange for an alternate
 
 6 plan of treatment for the member if a non-participating emergency
 
 7 provider and the plan are unable to reach agreement on services
 
 8 necessary beyond those immediately needed to stabilize the
 
 9 member, under which:
 
10           (A)  A participating physician with privileges at the
 
11                hospital arrives at the emergency department of
 
12                the hospital promptly and assumes responsibility
 
13                for the treatment of the member; or
 
14           (B)  With the agreement of the treating physician or
 
15                another health professional in the emergency
 
16                department:
 
17                (i)  Arrangement is made for transfer of the
 
18                     member to another facility using medical
 
19                     resources consistent with the condition of
 
20                     the enrollee;
 
21               (ii)  An appointment is made with a participating
 
22                     physician or provider for treatment needed by
 
23                     the enrollee; or
 

 
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 1              (iii)  Another arrangement is made for treatment of
 
 2                     the enrollee."
 
 3      SECTION 11.  The patient rights and responsibilities task
 
 4 force shall develop proposed legislation addressing issues within
 
 5 the scope of the task forces' responsibilities under Act 178,
 
 6 Session Laws of Hawaii 1998, left unresolved by this Act.  The
 
 7 proposed legislation shall be submitted to the legislature no
 
 8 later than twenty days before the convening of the regular
 
 9 session of 2000.
 
10      SECTION 12.  Upon approval of this Act, every mutual benefit
 
11 society under article 1 of chapter 432, Hawaii Revised Statutes,
 
12 every health maintenance organization under chapter 432D, Hawaii
 
13 Revised Statutes, and every other entity offering or providing
 
14 health benefits or services under the regulation of the insurance
 
15 commissioner, except an insurer licensed to offer health
 
16 insurance under article 10A of chapter 431, Hawaii Revised
 
17 Statutes, shall pay to the commissioner at a time determined by
 
18 the commissioner, a one-time assessment in an amount not to
 
19 exceed the aggregate amount of $150,000, to be credited to the
 
20 health insurance revolving fund established under section 432E-B,
 
21 Hawaii Revised Statutes.
 
22      SECTION 13.  There is appropriated out of the health
 
23 insurance revolving fund established under section 432E-B, Hawaii
 

 
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 1 Revised Statutes, the sum of $           or so much thereof as
 
 2 may be necessary for fiscal year 1999-2000 and the same sum or so
 
 3 much thereof as may be necessary, for fiscal year 2000-2001 to
 
 4 carry out the purposes of this Act.
 
 5      SECTION 14.  The sum appropriated shall be expended by the
 
 6 department of commerce and consumer affairs.
 
 7      SECTION 15.  In codifying new sections added by this Act,
 
 8 the revisor shall substitute the appropriate section numbers for
 
 9 the letters used in designating the new sections of this Act.
 
10      SECTION 16.  Statutory material to be repealed is bracketed.
 
11 New statutory material is underscored.
 
12      SECTION 17.  This Act shall take effect upon its approval;
 
13 provided that sections 13, 14, 15, and 16 shall take effect on
 
14 July 1, 1999; and provided further that sections 3, 4, 9, 10, and
 
15 11 of this Act shall be repealed on July 1, 2003, and sections
 
16 432E-1 and 432E-3, Hawaii Revised Statutes, are reenacted in the
 
17 form in which they read on the day before the approval of this
 
18 Act.