§ 301.203. Filing requirements.
(a) Along with the submission of adequate reserving methodology, an HMO shall submit a formal product filing to the Division of HMOs/PPOs of the Department and the Bureau of Health Financing and Program Development of the Department of Health.
(b) HMOs will be permitted to offer a point-of-service product subject to the following conditions.
(1) Filing requirements—all products:
(i) Two copies shall be submitted to each Department.
(ii) The filing shall include an appropriate rate filing.
(iii) The filing should contain incentives for HMO members to utilize basic HMO services, stay within the HMO panel of participating providers, and utilize the services of designated primary care physicians. Minimum requirements for indemnity reimbursement for out-of-network claims should be:
(A) Minimum deductible of $250 per individual/$500 per family per calendar year.
(B) Minimum coinsurance of 20%.
(C) Total out-of-pocket expenses for use of nonnetwork providers should be in the following ranges:
(I) Individual annual out-of-pocket expense, excluding calendar year deductible: minimum—$2,000; maximum—$5,000.
(II) Family annual out-of-pocket expense, excluding calendar year deductible: minimum—$4,000; maximum—$10,000.
(III) The lifetime maximum for point-of-service out-of-network claims per person shall be at least $250,000.
(iv) Clear and adequate disclosure is an absolute necessity because of the complexity of the point-of-service product and great potential for enrollees to misunderstand it. The evidence of coverage shall contain adequate disclosure of coverage limitations and conditions, including member liability for deductibles, copayments and differences between the HMO’s UCR reimbursement and actual charges of out-of-network providers.
(v) Primary care services shall only be reimbursable within the HMO network when rendered at or by direction of the member’s primary care physician. Primary care services shall be services which the primary care physician is requested to provide under the provisions of the contract with the HMO.
(vi) An HMO may require precertification of out-of-network nonemergency hospital admissions.
(vii) Emergency coverage shall be provided under provisions of the basic HMO coverage without application of out-of-network deductibles or coinsurance.
(viii) The filing shall include an explanation of how the HMO will meet its continuity of care requirements under the act and 28 Pa. Code (relating to health and safety).
(ix) The HMO shall require that either the member’s PCP or the HMO itself issue a claim form or other notice for use by the member in claiming reimbursement for out-of-network care. The claim form or other notice shall be submitted for review and approval of the Departments and the Department of Health. The claim form or notice shall require the signature of the member and contain adequate disclosure that the member understands that by voluntarily seeking care out-of-network the member is assuming substantial financial liability for the care, and that the care if provided within the HMO network would be provided at a much lower out-of-pocket expense to the member.
(x) The HMO is responsible for furnishing claims information to the primary care physician concerning the member’s usage of out-of-network health services. The objective of this requirement is to provide critical information to the patient’s primary care physician so that when the member returns in-network, the PCP has adequate knowledge to maintain continuity of care.
(xi) Other methods to accomplish the objective in subparagraph (x) may be proposed in the filing and will be reviewed on a case by case basis.
(xii) An information system shall be included by which the HMO will track the claims payments by PCP for out-of-network services. The HMO shall commit itself to monitoring out-of-network usage and to promptly investigate any PCP practice whose enrolled members are utilizing substantially higher levels of out-of-network care than average. Therefore, written policies and procedures shall be included in the filing to ensure that PCPs are not subtlety or otherwise encouraging members to use out-of-network providers.
(xiii) The filing shall describe in detail the HMO’s claims payment system. This description shall include staffing for paying out-of-network indemnity claims and capability for establishing adequate tracking, estimation and reserving for incurred but not reported claims.
(xiv) The HMO’s data/information system shall be capable of paying out-of-network claims in a timely manner, tracking incurred but not reported expenses, adequately forecasting projections, calculating the 10% limit, adequately interfacing between membership and eligibility files and between the HMO’s systems and those of an applicable affiliated insurer, and generating required Department reports.
(xv) Nongroup conversions are not required to include a point-of-service benefit.
(xvi) Approvals for point-of-service products will be subject to a 1-year probationary period during which time the HMO will have to establish a track record of successfully administering a point-of-service product. During the 1-year probationary period, enrollment in the point-of-service may not exceed 5% of the HMO’s private sector enrollment.
(b) Additional filing requirements for products in which the out-of-network indemnity benefits are to be underwritten by an HMO affiliated insurer, which is any carrier other than the HMO itself proposing to supplement the HMO’s standard coverage by providing out-of-network benefits are:
(1) The filing shall be made by the HMO.
(2) The filing shall include:
(i) Copies of the previously approved group contract and certificate.
(ii) Copies of amendments necessary or desirable thereto to integrate the services to be provided by the HMO and paid for by the affiliate insurer.
(iii) Copies of the affiliated insurers group master contract and certificate.
(iv) Enrollment material and enrollee literature.
(v) The certificates and enrollee literature that adequately explain how the program will operate.
(vi) A copy of the contract between the HMO and affiliated insurer detailing their respective responsibilities and obligations in offering a point-of-service product.
(3) The HMO shall include in its rate filing the rate level justification and a demonstration of how the out-of-network indemnity benefits to be provided by the affiliated insurer will impact on the HMO’s rates and underlying utilization assumptions.
(4) To lessen confusion on the part of members, out-of-network claims shall be initially filed with the HMO. Additionally, the member point of contact regarding out-of-network benefits shall always be with the HMO.
(5) Grievances, including those concerning coverage or claim denial under the out-of-network benefit program, shall be subject to and decided by the HMO’s approved grievance system and procedures.
(6) The affiliated insurer and joint product shall comply with this subchapter except for the financial reserving requirements of § 301.202(b) (relating to financial requirements—point-of-service products).
(7) The HMO is responsible for utilization management activities, not the affiliated insurer.
Source The provisions of this § 301.203 adopted September 27, 1991, effective September 28, 1991, 21 Pa.B. 4424.
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