TITLE 42

State Affairs and Government

CHAPTER 42-14.5

The Rhode Island Health Care Reform Act of 2004 – Health Insurance

Oversight

SECTION 42-14.5-3



   § 42-14.5-3  Powers and duties

[Contingent effective date; see effective dates under this section.].

–

The health insurance commissioner shall have the following powers and duties:



   (a) To conduct quarterly public meetings throughout the

state, separate and distinct from rate hearings pursuant to § 42-62-13,

regarding the rates, services, and operations of insurers licensed to provide

health insurance in the state, the effects of such rates, services, and

operations on consumers, medical care providers, patients, and the market

environment in which such insurers operate, and efforts to bring new health

insurers into the Rhode Island market. Notice of not less than ten (10) days of

said hearing(s) shall go to the general assembly, the governor, the Rhode

Island Medical Society, the Hospital Association of Rhode Island, the director

of health, the attorney general and the chambers of commerce. Public notice

shall be posted on the department's web site and given in the newspaper of

general circulation, and to any entity in writing requesting notice.



   (b) To make recommendations to the governor and the house of

representatives and senate finance committees regarding health care insurance

and the regulations, rates, services, administrative expenses, reserve

requirements, and operations of insurers providing health insurance in the

state, and to prepare or comment on, upon the request of the governor or

chairpersons of the house or senate finance committees, draft legislation to

improve the regulation of health insurance. In making such recommendations, the

commissioner shall recognize that it is the intent of the legislature that the

maximum disclosure be provided regarding the reasonableness of individual

administrative expenditures as well as total administrative costs. The

commissioner shall make recommendations on the levels of reserves including

consideration of: targeted reserve levels; trends in the increase or decrease

of reserve levels; and insurer plans for distributing excess reserves.



   (c) To establish a consumer/business/labor/medical advisory

council to obtain information and present concerns of consumers, business, and

medical providers affected by health insurance decisions. The council shall

develop proposals to allow the market for small business health insurance to be

affordable and fairer. The council shall be involved in the planning and

conduct of the quarterly public meetings in accordance with subsection (a)

above. The advisory council shall develop measures to inform small businesses

of an insurance complaint process to ensure that small businesses that

experience rate increases in a given year may request and receive a formal

review by the department. The advisory council shall assess views of the health

provider community relative to insurance rates of reimbursement, billing, and

reimbursement procedures, and the insurers' role in promoting efficient and

high-quality health care. The advisory council shall issue an annual report of

findings and recommendations to the governor and the general assembly and

present its findings at hearings before the house and senate finance

committees. The advisory council is to be diverse in interests and shall

include representatives of community consumer organizations; small businesses,

other than those involved in the sale of insurance products; and hospital,

medical, and other health provider organizations. Such representatives shall be

nominated by their respective organizations. The advisory council shall be

co-chaired by the health insurance commissioner and a community consumer

organization or small business member to be elected by the full advisory

council.



   (d) To establish and provide guidance and assistance to a

subcommittee ("the professional provider-health plan work group") of the

advisory council created pursuant to subsection (c) above, composed of health

care providers and Rhode Island licensed health plans. This subcommittee shall

include in its annual report and presentation before the house and senate

finance committees the following information:



   (1) A method whereby health plans shall disclose to

contracted providers the fee schedules used to provide payment to those

providers for services rendered to covered patients;



   (2) A standardized provider application and credentials

verification process, for the purpose of verifying professional qualifications

of participating health care providers;



   (3) The uniform health plan claim form utilized by

participating providers;



   (4) Methods for health maintenance organizations as defined

by § 27-41-1, and nonprofit hospital or medical service corporations as

defined by chapters 19 and 20 of title 27, to make facility-specific data and

other medical service-specific data available in reasonably consistent formats

to patients regarding quality and costs. This information would help consumers

make informed choices regarding the facilities and/or clinicians or physician

practices at which to seek care. Among the items considered would be the unique

health services and other public goods provided by facilities and/or clinicians

or physician practices in establishing the most appropriate cost comparisons;



   (5) All activities related to contractual disclosure to

participating providers of the mechanisms for resolving health plan/provider

disputes;



   (6) The uniform process being utilized for confirming, in

real time, patient insurance enrollment status, benefits coverage, including

co-pays and deductibles;



   (7) Information related to temporary credentialing of

providers seeking to participate in the plan's network and the impact of said

activity on health plan accreditation;



   (8) The feasibility of regular contract renegotiations

between plans and the providers in their networks; and



   (9) Efforts conducted related to reviewing impact of silent

PPOs on physician practices.



   (e) To enforce the provisions of Title 27 and Title 42 as set

forth in § 42-14-5(d).



   (f) To provide analysis of the Rhode Island Affordable Health

Plan Reinsurance Fund. The fund shall be used to effectuate the provisions of

§§ 27-18.5-8 and 27-50-17.



   (g) To analyze the impact of changing the rating guidelines

and/or merging the individual health insurance market as defined in chapter

18.5 of title 27 and the small employer health insurance market as defined in

chapter 50 of title 27 in accordance with the following:



   (1) The analysis shall forecast the likely rate increases

required to effect the changes recommended pursuant to the preceding subsection

(g) in the direct-pay market and small employer health insurance market over

the next five (5) years, based on the current rating structure and current

products.



   (2) The analysis shall include examining the impact of

merging the individual and small employer markets on premiums charged to

individuals and small employer groups.



   (3) The analysis shall include examining the impact on rates

in each of the individual and small employer health insurance markets and the

number of insureds in the context of possible changes to the rating guidelines

used for small employer groups, including: community rating principles;

expanding small employer rate bonds beyond the current range; increasing the

employer group size in the small group market; and/or adding rating factors for

broker and/or tobacco use.



   (4) The analysis shall include examining the adequacy of

current statutory and regulatory oversight of the rating process and factors

employed by the participants in the proposed new merged market.



   (5) The analysis shall include assessment of possible

reinsurance mechanisms and/or federal high-risk pool structures and funding to

support the health insurance market in Rhode Island by reducing the risk of

adverse selection and the incremental insurance premiums charged for this risk,

and/or by making health insurance affordable for a selected at-risk population.



   (6) The health insurance commissioner shall work with an

insurance market merger task force to assist with the analysis. The task force

shall be chaired by the health insurance commissioner and shall include, but

not be limited to, representatives of the general assembly, the business

community, small employer carriers as defined in § 27-50-3, carriers

offering coverage in the individual market in Rhode Island, health insurance

brokers, and members of the general public.



   (7) For the purposes of conducting this analysis, the

commissioner may contract with an outside organization with expertise in fiscal

analysis of the private insurance market. In conducting its study, the

organization shall, to the extent possible, obtain and use actual health plan

data. Said data shall be subject to state and federal laws and regulations

governing confidentiality of health care and proprietary information.



   (8) The task force shall meet as necessary and include its

findings in the annual report and the commissioner shall include the

information in the annual presentation before the house and senate finance

committees.



   (h) To establish and convene a workgroup representing health

care providers and health insurers for the purpose of coordinating the

development of processes, guidelines, and standards to streamline health care

administration that are to be adopted by payors and providers of health care

services operating in the state. This workgroup shall include representatives

with expertise who would contribute to the streamlining of health care

administration and who are selected from hospitals, physician practices,

community behavioral health organizations, each health insurer, and other

affected entities. The workgroup shall also include at least one designee each

from the Rhode Island Medical Society, Rhode Island Council of Community Mental

Health Organizations, the Rhode Island Health Center Association, and the

Hospital Association of Rhode Island. The workgroup shall consider and make

recommendations for:



   (1) Establishing a consistent standard for electronic

eligibility and coverage verification. Such standard shall:



   (i) Include standards for eligibility inquiry and response

and, wherever possible, be consistent with the standards adopted by nationally

recognized organizations, such as the Centers for Medicare and Medicaid

Services;



   (ii) Enable providers and payors to exchange eligibility

requests and responses on a system-to-system basis or using a payor-supported

web browser;



   (iii) Provide reasonably detailed information on a consumer's

eligibility for health care coverage; scope of benefits; limitations and

exclusions provided under that coverage; cost-sharing requirements for specific

services at the specific time of the inquiry; current deductible amounts;

accumulated or limited benefits; out-of-pocket maximums; any maximum policy

amounts; and other information required for the provider to collect the

patient's portion of the bill;



   (iv) Reflect the necessary limitations imposed on payors by

the originator of the eligibility and benefits information;



   (v) Recommend a standard or common process to protect all

providers from the costs of services to patients who are ineligible for

insurance coverage in circumstances where a payor provides eligibility

verification based on best information available to the payor at the date of

the request of eligibility.



   (2) Developing implementation guidelines and promoting

adoption of such guidelines for:



   (i) The use of the National Correct Coding Initiative code

edit policy by payors and providers in the state;



   (ii) Publishing any variations from codes and mutually

exclusive codes by payors in a manner that makes for simple retrieval and

implementation by providers;



   (iii) Use of health insurance portability and accountability

act standard group codes, reason codes, and remark codes by payors in

electronic remittances sent to providers;



   (iv) The processing of corrections to claims by providers and

payors.



   (v) A standard payor-denial review process for providers when

they request a reconsideration of a denial of a claim that results from

differences in clinical edits where no single, common-standards body or process

exists and multiple conflicting sources are in use by payors and providers.



   (vi) Nothing in this section, or in the guidelines developed,

shall inhibit an individual payor's ability to employ, and not disclose to

providers, temporary code edits for the purpose of detecting and deterring

fraudulent billing activities. The guidelines shall require that each payor

disclose to the provider its adjudication decision on a claim that was denied

or adjusted based on the application of such edits and that the provider have

access to the payor's review and appeal process to challenge the payor's

adjudication decision.



   (vii) Nothing in this subsection shall be construed to modify

the rights or obligations of payors or providers with respect to procedures

relating to the investigation, reporting, appeal, or prosecution under

applicable law of potentially fraudulent billing activities.



   (3) Developing and promoting widespread adoption by payors

and providers of guidelines to:



   (i) Ensure payors do not automatically deny claims for

services when extenuating circumstances make it impossible for the provider to

obtain a preauthorization before services are performed or notify a payor

within an appropriate standardized timeline of a patient's admission;



   (ii) Require payors to use common and consistent processes

and time frames when responding to provider requests for medical management

approvals. Whenever possible, such time frames shall be consistent with those

established by leading national organizations and be based upon the acuity of

the patient's need for care or treatment. For the purposes of this section,

medical management includes prior authorization of services, preauthorization

of services, precertification of services, post-service review,

medical-necessity review, and benefits advisory;



   (iii) Develop, maintain, and promote widespread adoption of a

single, common website where providers can obtain payors' preauthorization,

benefits advisory, and preadmission requirements;



   (iv) Establish guidelines for payors to develop and maintain

a website that providers can use to request a preauthorization, including a

prospective clinical necessity review; receive an authorization number; and

transmit an admission notification.



   (i) To issue an ANTI-CANCER MEDICATION REPORT. Not

later than June 30, 2014 and annually thereafter, the office of the health

insurance commissioner (OHIC) shall provide the senate committee on health and

human services, and the house committee on corporations, with: (1) Information

on the availability in the commercial market of coverage for anti-cancer

medication options; (2) For the state employee's health benefit plan, the costs

of various cancer treatment options; (3) The changes in drug prices over the

prior thirty-six (36) months; and (4) Member utilization and cost-sharing

expense.



   (j) To monitor the adequacy of each health plan's compliance

with the provisions of the federal mental health parity act, including a review

of related claims processing and reimbursement procedures. Findings,

recommendations, and assessments shall be made available to the public.



   (k) To monitor the transition from fee for service and toward

global and other alternative payment methodologies for the payment for health

care services. Alternative payment methodologies should be assessed for their

likelihood to promote access to affordable health insurance, health outcomes,

and performance.



   (l) To report annually, no later than July 1, 2014, then

biannually thereafter, on hospital payment variation, including findings and

recommendations, subject to available resources.



   (m) Notwithstanding any provision of the general or public

laws or regulation to the contrary, provide a report with findings and

recommendations to the president of the senate and the speaker of the house, on

or before April 1, 2014, including, but not limited to, the following

information:



   (1) The impact of the current mandated healthcare benefits as

defined in §§ 27-18-48.1, 27-18-60, 27-18-62, 27-18-64, similar

provisions in chapters 19, 20 and 41, of title 27, and §§ 27-18-3(c),

27-38.2-1 et seq., or others as determined by the commissioner, on the cost of

health insurance for fully insured employers, subject to available resources;



   (2) Current provider and insurer mandates that are

unnecessary and/or duplicative due to the existing standards of care and/or

delivery of services in the healthcare system;



   (3) A state-by-state comparison of health insurance mandates

and the extent to which Rhode Island mandates exceed other states benefits; and



   (4) Recommendations for amendments to existing mandated

benefits based on the findings in (1), (2) and (3) above.



   (n) On or before July 1, 2014, the office of the health

insurance commissioner, in collaboration with the director of health and

lieutenant governor's office, shall submit a report to the general assembly and

the governor to inform the design of accountable care organizations (ACOs) in

Rhode Island as unique structures for comprehensive healthcare delivery and

value based payment arrangements, that shall include, but not be limited to:



   (1) Utilization review;



   (2) Contracting; and



   (3) Licensing and regulation.



   (o) On or before February 3, 2015, the office of the health

insurance commissioner shall submit a report to the general assembly and the

governor that describes, analyzes, and proposes recommendations to improve

compliance of insurers with the provisions of § 27-18-76 with regard to

patients with mental health and substance-use disorders.



History of Section.

(P.L. 2004, ch. 446, § 2; P.L. 2004, ch. 557, § 2; P.L. 2005, ch.

273, § 1; P.L. 2005, ch. 274, § 1; P.L. 2006, ch. 248, § 3; P.L.

2006, ch. 273, § 7; P.L. 2006, ch. 274, § 3; P.L. 2006, ch. 297,

§ 7; P.L. 2007, ch. 82, § 1; P.L. 2007, ch. 205, § 1; P.L. 2008,

ch. 475, § 10; P.L. 2009, ch. 68, art. 5, § 12; P.L. 2010, ch. 239,

§ 6; P.L. 2012, ch. 378, § 1; P.L. 2012, ch. 390, § 1; P.L.

2013, ch. 323, § 5; P.L. 2013, ch. 341, § 6; P.L. 2013, ch. 394,

§ 6; P.L. 2013, ch. 405, § 5; P.L. 2014, ch. 178, § 2; P.L.

2014, ch. 204, § 2.)