[29 Pa.B. 6409]
[Continued from previous Web Page]
Subchapter I. Complaints and Grievances Section 9.701. Applicability.
This subchapter applies to the review and appeal of complaints and grievances. This subchapter would be based upon the requirements of Act 68 relating to complaints and grievances. See 40 P. S. §§ 2141, 2142, 2161 and 2162. The Department derives its authority to approve the complaint and grievance process from Act 68, the HMO Act and the PPO Act. The HMO Act requires an HMO to have a grievance resolution process acceptable to the Secretary. See 40 P. S. § 1560(e). The PPO Act requires the Department of Insurance to consult with the Department to determine whether arrangements and provisions for a PPO which assumes financial risk which may lead to under-treatment or poor quality care are adequately addressed by a formal grievance system. See 40 P. S. § 764a(e). This subchapter would replace, in its entirety, the requirements in § 9.73 of the HMO regulations (relating to subscriber grievance systems) with new provisions required by Act 68. This section would clarify that.
Section 9.702. Complaints and grievances.
This section would deal with new subject matter. Subsection (a) would require a plan to provide copies of its complaint and grievance procedures to the Department for review prior to implementation. Subsection (b) would require the plan to correct noncompliant procedures at the Department's direction. Because the plan is given the ability by Act 68 to classify a matter as either a complaint or grievance, the possibility exists that the plan could classify a matter in such a way as to confer an advantage on itself. Subsection (c) would permit either the Insurance Department or the Department to become involved at the classification stage to prevent this problem from arising.
Subsection (d) would allow a plan to set up its own time frames in which the initial grievance must be filed. The Department is proposing to require a plan to allow an enrollee or a health care provider filing a grievance with the consent of the enrollee to have the same amount of time to file first and second level complaints and grievances as a plan is given by the act to consider them.
Section 9.703. Health care provider initiated grievances.
This section would deal with new subject matter. Act 68 allows for provider initiated grievances with the written consent of the enrollee. See 40 P. S. § 991.2161(a). Subsection (b) would protect the enrollee from coercion by not allowing the provider to require consent as a condition of service. Subsection (c) would require that once a provider assumes responsibility for a grievance, the provider must continue to prosecute the grievance through the second level review. Subsection (h) would allow the enrollee to rescind his consent at any time. Through these subsections, the Department would attempt to protect the enrollee from the provider that initially is willing to grieve the matter, but makes a determination during the process that the matter is no longer cost effective for it to pursue. The grievance issue, however, may still represent significant out-of-pocket expense to the enrollee. The Department is not proposing to allow the enrollee to begin the grievance at the initial review, however. Subsection (h) would allow an enrollee to take over the grievance at the point the provider chose to discontinue it. This provision would protect the interests of both parties, and would not be detrimental to the managed care plan.
The Department is also concerned with billing aspects of the provider grievance. Subsections (c) and (d) would prohibit the provider from billing the enrollee until there is an outcome to the grievance. Allowing the provider to bill the enrollee prior to the outcome could result in a double recovery for the provider, or could cause the enrollee to expend time and money affirmatively seeking a refund from that provider.
Finally, subsection (f) would require the provider to clearly disclose to the enrollee the consequences of the enrollee consenting to the provider filing a grievance, and subsection (g) would require the consent form used by the plan to inform the enrollee of the right to rescind consent.
Section 9.704. Internal complaint process.
This section would deal with new subject matter. Its requirements would be similar to those contained in section 2141 of Article XXI (40 P. S. § 991.2141). To ensure the fundamental fairness of the complaint review process, subsection (c)(1)(i) would require that the first level complaint review be made up of persons not involved in the initial decision. In the interests of fundamental fairness, subsection (c)(2)(ii) would require that the plan, during the second level review, provide reasonable flexibility in terms of the enrollee's time and travel distance when scheduling a second level review. The Department is also proposing that the plan provide the enrollee the opportunity to communicate with the review committee if the enrollee cannot attend. Finally, subsection (c)(2)(ii)(A) and (C) would require that the plan identify all persons present at the review for the enrollee. Subsection (c)(2)(iv) would require that the deliberations of the committee, including the enrollee's comments, either be transcribed verbatim or summarized, and forwarded to the Department as part of the complaint record. Subsection (c)(2)(vii) would specify what is to be included in the Act 68 notice to be sent to the enrollee. This information would be necessary for the individual to make a valid appeal to the Department. The Department is proposing that the plan be required to send the notice of the second level decision to the enrollee by a method which would permit the plan to document the enrollee's receipt of the decision. This would enable the Department to fulfill its responsibilities under section 2142 of Article XXI (40 P. S. § 991.2142) by determining whether the enrollee has appealed within 15 days of receipt of the decision.
Section 9.705. Appeal of a complaint decision.
This section would deal with new subject matter, and would include substantially the same information as contained in section 2142 of Article XXI. Subsection (b) would require that an enrollee provide to it certain information along with the appeal, for example, the name of the plan and a description of the issue involved.
Because Act 68 provides authority over complaints to both the Insurance Department and the Department, the Department is proposing in subsection (f) that both agencies jointly determine which agency will hear the appeal.
Lastly, it should be noted that the proposed regulations on the complaint appeal would provide for an appeal to the Department. The proposed regulations would not require that the Department provide the enrollee or the plan an administrative hearing. Subsection (g) would provide that, if either department believes that a hearing is necessary to the resolution of the appeal, it would be able to require and conduct a hearing.
Section 9.706. Enrollee and provider grievance system.
This section would deal with new subject matter. Its requirements would be similar to those contained in section 2161 of Article XXI (40 P. S. § 991.2161). To ensure the fundamental fairness of the process, subsection (c)(2)(ii) would impose similar requirements on the second level grievance review as it is proposing for the second level complaint review. Act 68 requires that the enrollee be afforded notice of the right to be present in the second level review committee meeting of both the complaint and the grievance process. Compare 40 P. S. § 991.2141(c)(2) with 40 P. S. § 991.2161(c)(2). Subsection (c)(2)(ii)(A)--(C) would require that the plan provide reasonable flexibility in terms of the enrollee's time and travel distance when scheduling the second level review, that it provide the enrollee the opportunity to communicate with the review committee if he cannot attend, and that it identify all persons present at the review for the enrollee. Subsection (c)(2)(iii) would require that the deliberations of the committee, including the enrollee's comments, either be transcribed verbatim or summarized, and forwarded to the CRE as part of the grievance record.
The provisions of Act 68 relating to internal grievances differ from those relating to internal complaints in a significant way, however. Act 68 requires inclusion in the first and second level grievance review of a licensed physician or, where appropriate, an approved licensed psychologist, in a same or similar specialty that typically manages or consults on the health care service in the first and second level grievance review. See 40 P. S. § 991.2161(d). To ensure that a plan would be able to obtain input of specialists most closely matched to the service in question, taking into account the calls on the specialist's time and practice, the Department has not read the term ''include'' to require the physical presence of the licensed physician or approved licensed psychologist referenced in section 2161(d) of Article XXI. Therefore, subsection (c)(3)(ii) proposes to allow this individual to be included in the review, discussion and decisionmaking by written report, telephone or video conference.
If the licensed physician or approved licensed psychologist would not be physically present, however, the Department is proposing in subsection (c)(3)(iii) to require the plan to provide that individual's report to the enrollee or health care provider in advance of the hearing, if the enrollee or health care provider requests the opinion in writing. The Department feels strongly that, to present the most comprehensive case, that the enrollee or the health care provider should be provided the opinion of the licensed physician or approved licensed psychologist prior to the date of the review. The Department is also proposing in subsection (c)(3)(iii) that the plan notify the enrollee or health care provider in advance of the review date of the fact that the licensed physician or approved licensed psychologist will not be physically present, and that that individual's report may be obtained in advance of the review.
Section 9.707. External grievance process.
This section would deal with new subject matter. It would help implement the requirement in Act 68 that a plan establish an external grievance review process, in which the Department participates by the appointment of a CRE to perform the review. See generally 40 P. S. § 991.2162. Subsection (b)(4) would implement this requirement by requiring the plan to provide the Department with two contacts with whom the Department may communicate. Subsection (b)(5) would require that a request for external review contain a certain set of minimum information to aid in the assignment of the CRE and the oversight of the external grievance.
Subsection (b)(7) would require that the plan provide the enrollee or health care provider with its description of the issue, the remedy it believes the enrollee or health care provider is seeking, and list of documents which it is to forward to the CRE. This information would be provided the enrollee within 15 days of the plan's receipt of the enrollee's or health care provider's request for an external grievance review. The Department proposes to require this exchange of information so that the enrollee or health care provider would know what information the plan has provided to the CRE, and would be able to determine whether additional information is necessary. The Department proposes this section in the interests of a full and fair resolution of the grievance without requiring the CRE to sift through duplicate documentation provided both by the plan and the enrollee or health care provider.
Subsection (g) would allow the parties the ability to challenge the appointment of a CRE based on conflict of interest. The parties would be able to object to the appointment until both parties agree on an acceptable CRE. Objection on the part of a plan to a CRE would not alleviate the proposed requirement that, or alter the time frames within which, the plan would be required to provide information to the enrollee. The Department's objective in proposing to allow objections to the appointment is to ensure that all parties agree that the services have been reviewed in an unbiased manner. The Department sees no benefit to having one party or the other believe a bias existed in the procedure. This would taint the outcome of the review and be more likely to force the matter to litigation.
Subsections (c) and (d) would provide for the Department to provide to the plan the name, address and telephone number of the appointed CRE. The plan would provide this information to the enrollee or health care provider. Subsection (e) allows either party, if they desire additional information, to request from the Department additional information from the CRE application. This would provide both parties with sufficient information with which to determine whether challenge of the appointment is necessary.
Subsection (f) would allow a plan to select a CRE if the Department is unable to do so within 2 business days of its receipt of the request. This would avoid inadvertent delay in the system. The enrollee would still be able to object to the plan's choice.
Section 9.708. Grievance reviews by CRE.
This section would deal with new subject matter. It would be base on the requirements for CRE review of an external grievance in section 2162(c)(2)--(5) of Article XXI. Subsections (a) and (b) would set out the time frame for the CRE decision, to whom the decision is to be sent, the basis and clinical rationale for the decision and the standard of review. These two proposed subsections would be based upon language included in section 2162(c)(5) of Article XXI. Subsection (c), which would set out information that the CRE is required to consider, would be based upon section 2162(c)(2) and (3) of Article XXI. Subsection (d), which would set requirements for who can make the decision on the CRE's behalf, is taken from section 2162(c)(4) of Article XXI.
Subsection (e) would reiterate the applicable definition of ''emergency services'' which is to be used in reviewing the grievance decision.
Section 9.709. Expedited review.
This section would deal with new subject matter. Act 68 creates an expedited process for any enrollee whose life, health or ability to regain maximum function would be would be placed in jeopardy by the delay occasioned by the normal review process. See 40 P. S. § 991.2161(e). Subsections (a)--(d) would allow an enrollee to have access to an expedited review process at any time these extreme circumstances arise, regardless of whether the appeal would be classified as a complaint or grievance, or whether the review is an internal or external one.
Further, because of the intent to provide a rapid response due to the extreme circumstances, subsection (i) would require the external review agency to issue a rapid response. This would prevent severe and irreparable harm to the enrollee before the decision can be made.
In the interests of expediting the review, the Department is taking steps to ensure that its own processes for appointing CREs do not prohibit the use of an expedited system. Under subsection (f), the Department would make available to the plan methods by which a CRE may be contacted directly by the plan on weekends and State holidays.
Section 9.710. Approval of plan enrollee complaint and enrollee and provider grievance systems.
This section would deal with new subject matter. The Department is proposing to review the enrollee complaint and grievance systems to ensure these systems meet the approval of the Secretary.
Section 9.711. Alternative provider dispute resolution systems.
This section would deal with new subject matter. Prior to Act 68, issues involving procedural errors and administrative denials involving the level or type of health care services provided were handled strictly between the health care plan and the health care provider. The denials occur daily through the routine operations of the plan. With the passage of Act 68, these denials have been interpreted as grievances by some plans, requiring consent of the enrollee for the provider to challenge the denial. This draws the enrollee into an administrative dispute to which the enrollee had not previously been a party since services would generally already have been provided and the enrollee not billed. The Department is attempting to address these issues by proposing this § 9.711. In this section, the Department is proposing to allow for alternative dispute resolution procedures, subject to the Department's approval, (see 40 P. S. § 991.2162(f)), that create mechanisms for routine procedural errors and denials to be addressed by providers and plans without the need for enrollee consent. However, the provider may still opt to obtain enrollee consent and file a grievance.
Subchapter J. Health Care Provider Contracts Section 9.721. Applicability.
This section would explain that Subchapter J applies to contracts between plans and health care providers, between HMOs and IDSs, and between IDSs and health care providers. The Department is proposing this subchapter, relating to health care provider contracts, under its authority to promulgate regulations relating to contractual relationships between the managed care plan and health care providers under Act 68, the HMO Act and the PPO Act. Section 2111(1) of Article XXI requires a managed care plan to assure availability and access of adequate health care providers to enable enrollees to have access to quality and continuity of care. Section 8(a) of the HMO Act (40 P. S. § 1558(a)) gives the Secretary the authority to require renegotiation of provider contracts when they require excessive payments, fail to include reasonable incentives or contribute to cost escalation.
The PPO Act also requires that the Insurance Department consult with the Department in determining whether arrangements and provisions for a PPO which assumes financial risk which may lead to under-treatment or poor quality care are adequately addressed by quality and utilization controls as well as by a formal grievance system. See 40 P. S. § 764a(e).
The Department's authority to review and approve IDS arrangements comes from these same provisions.
Section 9.722. Plan and health care provider contracts.
This section would deal with new subject matter. This section would inform a plan of what minimum requirements are necessary in a provider contract to make it acceptable to the Department, and to obviate the possibility that the plan will be required to renegotiate the document. Subsections (c) and (d) would include a requirement that provisions related to gag clauses are prohibited. Subsection (e) would require certain consumer protection language, for example, subsection (e)(1) would require a contract to include enrollee hold harmless language, before the contract could be approved. Subsection (e)(7) would require language relating to enrollee notice of plan termination of the provider contract, and language relating to reimbursement which would address the financial incentives prohibition of Act 68. See 40 P. S. § 991.2112.
Section 9.723. IDS.
Section 9.724. HMO-IDS provider contract.
Section 9.725. IDS provider contracts.
In 1996, the Department issued a policy statement addressing IDS. This policy statement, entitled, ''PHOs, POs, and IDSs--Statement of Policy,'' (§§ 9.401--9.416), would be replaced by §§ 9.723--9.725 (relating to IDS; HMO-IDS provider contract; and IDS-provider contracts). The Department is proposing to combine certain provisions of that policy statement, and include those provisions in these sections as discussed as follows.
Section 9.723 would require that IDS contracts meet the terms and conditions of provider contracts in proposed § 9.722. Section 9.723 would require the HMO and its contracted IDS to notify the Department of any action occurring which would prevent the IDS's participating providers from ensuring adequate services. This is in keeping with the Department's responsibility to ensure the accessibility and availability of adequate personnel and facilities. See 40 P. S. § 1555.1(b)(1)(i).
Section 9.724(c)(5) would reinforce the fact that the HMO, as the regulated entity, would be responsible at all times for the services it contracts to have provided. Subsection (c)(6) and (7) would require the IDS to agree to be subject to monitoring by both the HMO and the Department.
Further, § 9.724 would protect the enrollee who is subject to a relationship. Subsection (c)(3) would prohibit the delay, reduction, denial or hindrance in any way of the provision of covered services to enrollees because of the contractual relationship between the IDS and the HMO. Subsection (c)(13) would require termination provisions that would be consistent with, and would enable enrollees to obtain the benefits of, the continuity of care requirements of Act 68. See 40 P. S. § 991.2117.
Section 9.725 would ensure that the contracts between the IDS and its providers make clear the chain of responsibility. This section would require language in the HMO--provider contracts that would ensure that all 3 parties, the provider, the IDS and the plan, would agree and concur that the HMO would have the ultimate responsibility. Further, the language would make clear that the Department would have the authority to review all 3 entities as it would the operations of HMO. Section 9.725 would prohibit language in the contract that would prevent the Department or the HMO from carrying out its functions and duties. Finally, paragraph (4) would require the inclusion in the contract of enrollee hold harmless language protecting enrollees from unexpected out-of-pocket costs.
Subchapter K. CREs Section 9.741. Applicability.
This section would explain that this subchapter applies to entities seeking certification to practice as CREs in this Commonwealth. This section also applies to licensed insurers for a limited purpose. Sections 2151 and 2152 of Article XXI give the Department the authority to set standards for and approve certification of CREs.
Section 9.742. CREs.
This section would deal with new subject matter. It would reflect the requirements of Act 68 regarding the certification of CREs. See 40 P. S. § 991.2151. Subsection (c) would also clarify that licensed insurers and managed care plans with certificates of authority may perform UR in accordance with the requirements of Act 68, but that it need not obtain a certification from the Department to do so.
Section 9.743. Content of an application for certification as a CREs.
This section would deal with new subject matter. It would establish requirements for the certification application of an entity seeing to perform UR within this Commonwealth. Among other things, subsection (c) would require the applicant to submit information concerning its organization, structure and function, including information concerning location, officers, directors and senior management, and a list of the plans in this Commonwealth for whom the entity currently performs UR. The Department is proposing to have this information provided because the Department will need to communicate with these organizations during external reviews. Also, the Department will need information to prevent conflict of interest situations from arising when it appoints CREs to undertake external reviews.
This section would also require the applicant to describe how it would be able to meet the terms and conditions in section 2152 of Article XXI. For example, subsection (c)(5)(i)--(iv) and (vi) would require the applicant to describe its ability to respond to telephone calls within the period of time set out in the act, its reviewer credentialing process, its ability to arrange for a wide range of health care providers to conduct the reviews, its procedures for ensuring confidentiality and its capacity for maintaining written records for a 3-year period. Subsection (c)(5)(viii) and (ix) would also require the applicant to provide information relating to its experience, including the length of time it has operated in the Commonwealth, if applicable, and a list of three clients for whom the applicant has performed UR.
The Department wants the application to provide it with sufficient information to ensure the applicant is capable of providing the services in accordance with Act 68.
Further, section 2151(c) of Article XXI permits the Department to adopt the standards for certification of CREs of a Nationally recognized accrediting body to the extent the standards meet and exceed the standards set forth in Act 68. Subsection (c)(5)(vii) would require an entity seeking certification to provide evidence of this accreditation if the applicant has undergone the accreditation.
Section 9.744. CREs participating in internal and external grievance reviews.
This section would deal with new subject matter. The Department is proposing to set additional requirements for a CRE wishing to participate in external grievance reviews as contemplated by Act 68. See 40 P. S. § 991.2162. Since this entity may have to participate in expedited reviews, subsection (a)(4) would provide additional information relevant to its ability to conduct an external review.
Section 9.745. Responsible applicant.
This section would deal with new subject matter. This section would require an applicant to be a responsible person. Subsection (a) would define what this term would require. Subsection (b) would require the applicant to be able to utilize the appropriate standard of review in performing reviews, and would further require the applicant to be unbiased in its review.
Section 9.746. Fees for certification and recertification of CREs.
This section would deal with new subject matter. The Department has the authority to establish fees for certification and recertification applications under section 2151(d) of Article XXI. Subsection (a) would require a fee of $1,000 for the initial application for an entity seeking to perform internal URs, and an additional $1,000 for any entity seeking to perform external reviews as well. Subsection (b) would require a fee of $500 for any recertification application. These fees would be commensurate with the amount of administrative time and resources required to review and verify the information in the application (including site visits) and to periodically monitor compliance with the standards.
Section 9.747. Department review and approval of a certification request.
This section would deal with new subject matter. This section would clarify the Department's authority to obtain additional information, inspect the books and records of the applicant and to perform site visits as it finds necessary to determine the applicant's compliance with Act 68 and the regulations. In lieu of a site visit by the Department, subsection (b) would permit the applicant to provide evidence of accreditation by a Nationally recognized accrediting body whose standards meet or exceed the standards of Act 68. If the applicant is not accredited, subsection (c) provides the applicant with the option to undergo a site inspection by a Nationally recognized accrediting body whose standards meet or exceed the standards of Act 68. The cost of a site visit would be borne by the applicant.
Section 9.748. Maintenance and renewal of CRE certification.
This section would deal with new subject matter. It would allow the Department to monitor a CRE during the 3-year certification period to ensure compliance with Act 68 and proposed regulations, and for purposes of renewal of certification. Subsection (a) would provide for monitoring in several ways: periodic onsite inspections, proof of the CRE's continuing accreditation by a Nationally recognized accrediting body whose standards meet or exceed the standards of Act 68 or an onsite inspection by an accrediting body.
Subsection (b) would require the CRE to submit a renewal application to the Department 60 days prior to the end of the 3-year certification period. The renewal application would include evidence of the CRE's continued accreditation by a Nationally recognized accrediting body whose standards meet or exceed the standards of Act 68, a certification that the CRE has complied with and will continue to comply with Act 68 and the regulations and an updating of the CRE's originally filed list of conflicts of interest and list of CRE contracts with plans. The Department could perform the onsite inspection, or the CRE could opt to have the onsite inspection done by a Nationally recognized accrediting body.
Subchapter L. Credentialing Section 9.761. Provider credentialing.
This section would deal with new subject matter. It would contain standards that would be modeled after standards utilized by a Nationally recognized accrediting body. The proposed standards would create a process by which a plan may critically evaluate credentials of new health care providers, and reevaluate the credentials and performance of currently contracted health care providers. Because managed care plans limit access to plan-selected and credentialed health care providers, these standards would ensure that the plan has an objective process by which it establishes and monitors its health care provider network. This further would ensure the provision of quality health care services to enrollees.
Affected Parties
The proposed regulations would affect HMOs certified to do business in this Commonwealth; managed care plans as defined by Act 68; including certified HMOs, and enrollees served by and providers who participate in these managed care plans. The proposed regulations would also affect entities, which conduct or want to conduct internal or external URs, since Act 68 requires these CREs to be certified by the Department. Licensed insurers would also be affected by proposed § 9.742. Licensed insurers and managed care plans with certificates of authority performing UR are required to comply with section 2152 of Article XXI. See 40 P. S. § 991.2151(e). Licensed insurers and managed care plans with certificates of authority are not required to seek certification.
Cost and Paperwork Estimates
A. Cost
The proposed regulations would have no measurable fiscal impact on local governments or the general public. The members of the general public enrolled in managed care plans governed by the regulations may ultimately experience some increase in health care costs due to the statutory requirements, and the concurrent increase in monitoring of those plans by the Department and the Department of Insurance.
The replacement and revision of the current regulations in Chapter 9 would create no additional cost to the Commonwealth, since these revisions are intended to reflect the current operations of the Department. There will be no additional cost to the Commonwealth, however, there may be additional monitoring duties placed on the Department by Act 68. Those duties are reflected in provisions of the proposed regulations relating to health care accountability and access, complaints and grievances, provider contracts, accreditation of CREs and credentialing.
The proposed regulations relating to HMOs should not have a significant fiscal impact upon HMOs since comprehensive revision and updating of the HMO regulations should make compliance with those regulations easier. With respect to the requirements of Act 68, which the Department proposes to implement through its proposed regulations, there may be some increased cost to managed care plans. The proposed regulations and Act 68 would require a certain composition of review committees, which may add to the cost of the review. The additional disclosure requirements of Act 68 may also have a fiscal impact upon managed care plans, including HMOs.
The proposed regulations would also create a fiscal impact on entities wishing to be certified as CREs. Act 68 authorizes the Department to adopt an application fee for entities requesting certification. The Department is proposing to do so in its proposed regulations. This certification requirement would not apply either to licensed insurers wishing to perform this function, or managed care entities with certificates of authority.
B. Paperwork
There would be changes in paperwork requirements associated with the proposed regulations. While the proposed regulations relating solely to HMOs would not alter paperwork requirements for those entities to obtain and maintain certificates of authority, the proposed regulations intended to implement Article XXI would require submission of documents from entities not previously regulated. These requirements would impact the Department, which would be required to review additional contracts and grievance and complaint procedures submitted by managed care plans, and requests for certification from CREs. The Department would also coordinate the external review procedure in Act 68, which would require the Department to appoint and oversee the operations of the CRE conducting the review.
There may be additional paperwork for managed care plans that are not HMOs, since they would be required for the first time to submit complaint and grievance procedures and data to the Department. HMOs are required by current regulations to make these submissions. Act 68 itself creates additional paperwork, since the plans must comply with the mandated complaint and grievance systems detailed in that act. Depending upon how plans operated their grievance systems prior to Act 68, that act and the Department's proposed regulations could require additional paperwork of the plans. Further, again depending upon how managed care plans operated prior to Act 68, that act's requirement that certain disclosures be made to enrollees could result in an increase in paperwork.
Act 68 also creates additional paperwork for CREs. Under Act 68, CREs are required to obtain certification from the Department to perform utilization reviews of health care services delivered or proposed to be delivered in this Commonwealth. Prior to the passage of Act 68, this requirement did not exist.
Act 68 and the proposed regulations might also create some different or additional paperwork for those members of the general public who obtain health care through managed care plans covered by Act 68. Depending upon the dispute resolution system established by plans prior to Act 68, there might be alterations in the manner in which an enrollee must utilize these procedures.
Effective Dates/Sunset Date
The proposed regulations will become effective upon publication of final-form regulations in the Pennsylvania Bulletin. No sunset date has been established. The Department will continually review and monitor the effectiveness of these regulations.
Statutory Authority
The Department's authority to promulgate these proposed regulations is based upon three statutes: the HMO Act (40 P. S. §§ 1551--1567); section 630 of The Insurance Company Law of 1921, known as the PPO Act (40 P. S. § 764a(e)); and Act 68.
The Department has authority to promulgate regulations relating to the certification and operations of HMOs under section 14 of the HMO Act (40 P. S. § 1564). Section 5.1(a) of the HMO Act provides the Department with the authority to determine what information to require in a corporation's application for certification as an HMO. Section 5.1(b)(1)(i) of the HMO Act provides the Department with authority to determine whether an HMO has demonstrated potential ability to assure both availability and accessibility of adequate personnel and facilities in manner enhancing availability, accessibility and continuity of services. Section 5.1(b)(1)(ii) of the HMO Act provides the Department with authority to determine whether an HMO has demonstrated it has arrangements for an ongoing quality of health care assurance program. Section 5.1(b)(1)(iii) of the HMO Act provides the Department with authority to determine whether an HMO has appropriate mechanisms to effectively provide or arrange for provision of basic health care services on a prepaid basis. Section 8(a) of the HMO Act (40 P. S. § 1558(a)) allows the Secretary to require renegotiation of provider contracts when those contracts provide for excessive payments, fail to include reasonable incentives or contribute to escalation of costs of health care services to enrollees. Section 8(a) of the HMO Act also permits the Secretary to require renegotiation when determined that the contracts are inconsistent with the purposes of the HMO Act. Section 10(e) of the HMO Act (40 P. S. § 1560(e)) requires that an HMO establish and maintain a grievance resolution system satisfactory to the Secretary. Section 11(c) of the HMO Act (40 P. S. § 1561(c)) provides the Secretary and his agents with free access to all books, records, papers and documents that relate to the nonfinancial business of the HMO. Finally, section 15 of the HMO Act (40 P. S. § 1565) provides the Department with the authority to suspend or revoke an HMO's certificate of authority, or to fine the HMO for violations of the HMO Act.
The Department has authority to promulgate regulations relating to the health care accountability and protection provisions of Act 68 under section 2181(e) of Article XXI (40 P. S. § 991.2181(e)). Act 68 governs managed care plans, which include, by definition, HMOs and gatekeeper PPOs. See the definition of ''managed care plan'' in 40 P. S. § 991.2102. Act 68 also regulates CREs operating or wishing to operate in this Commonwealth. See 40 P. S. §§ 991.2151 and 991.2152. The Department has authority to enforce compliance with Article XXI under section 2181(d) of Article XXI (40 P. S. § 991.2181(d)), and to impose fines, obtain injunctions, require plans of correction and ban enrollment under section 2182 of Article XXI (40 P. S. § 991.2182).
Section 2102(g) of The Administrative Code of 1929 (71 P. S. § 532(g)) provides the Department with general authority to promulgate its regulations.
The Department also has authority to review and approve grievance resolution systems and to require quality and utilization controls of certain PPOs under the PPO Act. Section 630 of The Insurance Company Law of 1921 requires that the Insurance Department consult with the Department in determining whether arrangements and provisions for a PPO which assumes financial risk which may lead to undertreatment or poor quality care are adequately addressed by quality and utilization controls as well as by a formal grievance system.
Regulatory Review
Under section 5(a) of the Regulatory Review Act (71 P. S. § 745.5(a)), on December 8, 1999, the Department submitted a copy of this proposed rulemaking to the Independent Regulatory Review Commission (IRRC) and to the Chairpersons of the House Health and Human Services Committee and the Senate Public Health and Welfare Committee. In addition to submitting the proposed rulemaking, the Department has provided IRRC and the Committees with a copy of a Regulatory Analysis Form prepared by the Department in compliance with Executive Order 1996-1, ''Regulatory Review and Promulgation.'' A copy of this material is available to the public upon request.
If IRRC has objections to any portion of the proposed rulemaking, it will notify the Department by February 17, 2000. The notifications shall specify the regulatory review criteria, which have not been met by that portion. The Regulatory Review Act specifies detailed procedures for review, prior to final publication of the regulation by the Department, the General Assembly and the Governor, of objections raised.
Contact Person
Interested persons are invited to submit written comments, suggestions or objections regarding the proposed regulations to Stacy Mitchell, Director, Bureau of Managed Care, Pennsylvania Department of Health, P. O. Box 90, Harrisburg, PA 17108-0090 (717) 787-5193, within 30 days after publication of this proposed rulemaking in the Pennsylvania Bulletin. Persons with a disability who wish to submit comments, suggestions or objections regarding the proposed rulemaking to Ms. Mitchell may do so in an alternative format (such as, audio tape, Braille) or by using V/TT (717) 783-6514 for speech or hearing impaired persons or the Pennsylvania AT&T Relay Service at (800) 654-5984[TT]. Persons who require an alternative format of this document may contact Ms. Mitchell at the above address or telephone numbers so that necessary arrangements may be made.
ROBERT S. ZIMMERMAN, Jr.,
SecretaryFiscal Note: 10-160. No fiscal impact; (8) recommends adoption.
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