97TH GENERAL ASSEMBLY
State of Illinois
2011 and 2012
SB3441

 

Introduced 2/7/2012, by Sen. David Koehler

 

SYNOPSIS AS INTRODUCED:
 
305 ILCS 5/12-4.25  from Ch. 23, par. 12-4.25

    Amends the Medical Assistance Article of the Illinois Public Aid Code. Prohibits the Department of Healthcare and Family Services from requiring a practitioner-owned group practice, partnership, or corporation to have a set number of licensed practitioner-owners who are eligible to provide medical services under the Code in order for the practitioner-owned group practice, partnership, or corporation to qualify as an alternate payee under the State's medical assistance program. Provides that the Department shall not prohibit a corporate entity that employs health care providers from participating as an alternate payee under the State's medical assistance program if the corporation is organized for the purpose of providing medical or other health care services. Effective immediately.


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FISCAL NOTE ACT MAY APPLY

 

 

A BILL FOR

 

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1    AN ACT concerning public aid.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Illinois Public Aid Code is amended by
5changing Section 12-4.25 as follows:
 
6    (305 ILCS 5/12-4.25)  (from Ch. 23, par. 12-4.25)
7    Sec. 12-4.25. Medical assistance program; vendor
8participation.
9    (A) The Illinois Department may deny, suspend or terminate
10the eligibility of any person, firm, corporation, association,
11agency, institution or other legal entity to participate as a
12vendor of goods or services to recipients under the medical
13assistance program under Article V, if after reasonable notice
14and opportunity for a hearing the Illinois Department finds:
15        (a) Such vendor is not complying with the Department's
16    policy or rules and regulations, or with the terms and
17    conditions prescribed by the Illinois Department in its
18    vendor agreement, which document shall be developed by the
19    Department as a result of negotiations with each vendor
20    category, including physicians, hospitals, long term care
21    facilities, pharmacists, optometrists, podiatrists and
22    dentists setting forth the terms and conditions applicable
23    to the participation of each vendor group in the program;

 

 

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1    or
2        (b) Such vendor has failed to keep or make available
3    for inspection, audit or copying, after receiving a written
4    request from the Illinois Department, such records
5    regarding payments claimed for providing services. This
6    section does not require vendors to make available patient
7    records of patients for whom services are not reimbursed
8    under this Code; or
9        (c) Such vendor has failed to furnish any information
10    requested by the Department regarding payments for
11    providing goods or services; or
12        (d) Such vendor has knowingly made, or caused to be
13    made, any false statement or representation of a material
14    fact in connection with the administration of the medical
15    assistance program; or
16        (e) Such vendor has furnished goods or services to a
17    recipient which are (1) in excess of his or her needs, (2)
18    harmful to the recipient, or (3) of grossly inferior
19    quality, all of such determinations to be based upon
20    competent medical judgment and evaluations; or
21        (f) The vendor; a person with management
22    responsibility for a vendor; an officer or person owning,
23    either directly or indirectly, 5% or more of the shares of
24    stock or other evidences of ownership in a corporate
25    vendor; an owner of a sole proprietorship which is a
26    vendor; or a partner in a partnership which is a vendor,

 

 

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1    either:
2            (1) was previously terminated from participation
3        in the Illinois medical assistance program, or was
4        terminated from participation in a medical assistance
5        program in another state that is of the same kind as
6        the program of medical assistance provided under
7        Article V of this Code; or
8            (2) was a person with management responsibility
9        for a vendor previously terminated from participation
10        in the Illinois medical assistance program, or
11        terminated from participation in a medical assistance
12        program in another state that is of the same kind as
13        the program of medical assistance provided under
14        Article V of this Code, during the time of conduct
15        which was the basis for that vendor's termination; or
16            (3) was an officer, or person owning, either
17        directly or indirectly, 5% or more of the shares of
18        stock or other evidences of ownership in a corporate
19        vendor previously terminated from participation in the
20        Illinois medical assistance program, or terminated
21        from participation in a medical assistance program in
22        another state that is of the same kind as the program
23        of medical assistance provided under Article V of this
24        Code, during the time of conduct which was the basis
25        for that vendor's termination; or
26            (4) was an owner of a sole proprietorship or

 

 

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1        partner of a partnership previously terminated from
2        participation in the Illinois medical assistance
3        program, or terminated from participation in a medical
4        assistance program in another state that is of the same
5        kind as the program of medical assistance provided
6        under Article V of this Code, during the time of
7        conduct which was the basis for that vendor's
8        termination; or
9        (g) The vendor; a person with management
10    responsibility for a vendor; an officer or person owning,
11    either directly or indirectly, 5% or more of the shares of
12    stock or other evidences of ownership in a corporate
13    vendor; an owner of a sole proprietorship which is a
14    vendor; or a partner in a partnership which is a vendor,
15    either:
16            (1) has engaged in practices prohibited by
17        applicable federal or State law or regulation relating
18        to the medical assistance program; or
19            (2) was a person with management responsibility
20        for a vendor at the time that such vendor engaged in
21        practices prohibited by applicable federal or State
22        law or regulation relating to the medical assistance
23        program; or
24            (3) was an officer, or person owning, either
25        directly or indirectly, 5% or more of the shares of
26        stock or other evidences of ownership in a vendor at

 

 

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1        the time such vendor engaged in practices prohibited by
2        applicable federal or State law or regulation relating
3        to the medical assistance program; or
4            (4) was an owner of a sole proprietorship or
5        partner of a partnership which was a vendor at the time
6        such vendor engaged in practices prohibited by
7        applicable federal or State law or regulation relating
8        to the medical assistance program; or
9        (h) The direct or indirect ownership of the vendor
10    (including the ownership of a vendor that is a sole
11    proprietorship, a partner's interest in a vendor that is a
12    partnership, or ownership of 5% or more of the shares of
13    stock or other evidences of ownership in a corporate
14    vendor) has been transferred by an individual who is
15    terminated or barred from participating as a vendor to the
16    individual's spouse, child, brother, sister, parent,
17    grandparent, grandchild, uncle, aunt, niece, nephew,
18    cousin, or relative by marriage.
19    (A-5) The Illinois Department may deny, suspend, or
20terminate the eligibility of any person, firm, corporation,
21association, agency, institution, or other legal entity to
22participate as a vendor of goods or services to recipients
23under the medical assistance program under Article V if, after
24reasonable notice and opportunity for a hearing, the Illinois
25Department finds that the vendor; a person with management
26responsibility for a vendor; an officer or person owning,

 

 

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1either directly or indirectly, 5% or more of the shares of
2stock or other evidences of ownership in a corporate vendor; an
3owner of a sole proprietorship that is a vendor; or a partner
4in a partnership that is a vendor has been convicted of a
5felony offense based on fraud or willful misrepresentation
6related to any of the following:
7        (1) The medical assistance program under Article V of
8    this Code.
9        (2) A medical assistance program in another state that
10    is of the same kind as the program of medical assistance
11    provided under Article V of this Code.
12        (3) The Medicare program under Title XVIII of the
13    Social Security Act.
14        (4) The provision of health care services.
15    (A-10) The Illinois Department may deny, suspend, or
16terminate the eligibility of any person, firm, corporation,
17association, agency, institution, or other legal entity to
18participate as a vendor of goods or services to recipients
19under the medical assistance program under Article V if, after
20reasonable notice and opportunity for a hearing, the Illinois
21Department finds that (i) the vendor, (ii) a person with
22management responsibility for a vendor, (iii) an officer or
23person owning, either directly or indirectly, 5% or more of the
24shares of stock or other evidences of ownership in a corporate
25vendor, (iv) an owner of a sole proprietorship that is a
26vendor, or (v) a partner in a partnership that is a vendor has

 

 

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1been convicted of a felony offense related to any of the
2following:
3        (1) Murder.
4        (2) A Class X felony under the Criminal Code of 1961.
5    (B) The Illinois Department shall deny, suspend or
6terminate the eligibility of any person, firm, corporation,
7association, agency, institution or other legal entity to
8participate as a vendor of goods or services to recipients
9under the medical assistance program under Article V:
10        (1) if such vendor is not properly licensed;
11        (2) within 30 days of the date when such vendor's
12    professional license, certification or other authorization
13    has been refused renewal or has been revoked, suspended or
14    otherwise terminated; or
15        (3) if such vendor has been convicted of a violation of
16    this Code, as provided in Article VIIIA.
17    (C) Upon termination of a vendor of goods or services from
18participation in the medical assistance program authorized by
19this Article, a person with management responsibility for such
20vendor during the time of any conduct which served as the basis
21for that vendor's termination is barred from participation in
22the medical assistance program.
23    Upon termination of a corporate vendor, the officers and
24persons owning, directly or indirectly, 5% or more of the
25shares of stock or other evidences of ownership in the vendor
26during the time of any conduct which served as the basis for

 

 

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1that vendor's termination are barred from participation in the
2medical assistance program. A person who owns, directly or
3indirectly, 5% or more of the shares of stock or other
4evidences of ownership in a terminated corporate vendor may not
5transfer his or her ownership interest in that vendor to his or
6her spouse, child, brother, sister, parent, grandparent,
7grandchild, uncle, aunt, niece, nephew, cousin, or relative by
8marriage.
9    Upon termination of a sole proprietorship or partnership,
10the owner or partners during the time of any conduct which
11served as the basis for that vendor's termination are barred
12from participation in the medical assistance program. The owner
13of a terminated vendor that is a sole proprietorship, and a
14partner in a terminated vendor that is a partnership, may not
15transfer his or her ownership or partnership interest in that
16vendor to his or her spouse, child, brother, sister, parent,
17grandparent, grandchild, uncle, aunt, niece, nephew, cousin,
18or relative by marriage.
19    Rules adopted by the Illinois Department to implement these
20provisions shall specifically include a definition of the term
21"management responsibility" as used in this Section. Such
22definition shall include, but not be limited to, typical job
23titles, and duties and descriptions which will be considered as
24within the definition of individuals with management
25responsibility for a provider.
26    (D) If a vendor has been suspended from the medical

 

 

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1assistance program under Article V of the Code, the Director
2may require that such vendor correct any deficiencies which
3served as the basis for the suspension. The Director shall
4specify in the suspension order a specific period of time,
5which shall not exceed one year from the date of the order,
6during which a suspended vendor shall not be eligible to
7participate. At the conclusion of the period of suspension the
8Director shall reinstate such vendor, unless he finds that such
9vendor has not corrected deficiencies upon which the suspension
10was based.
11    If a vendor has been terminated from the medical assistance
12program under Article V, such vendor shall be barred from
13participation for at least one year, except that if a vendor
14has been terminated based on a conviction of a violation of
15Article VIIIA or a conviction of a felony based on fraud or a
16willful misrepresentation related to (i) the medical
17assistance program under Article V, (ii) a medical assistance
18program in another state that is of the kind provided under
19Article V, (iii) the Medicare program under Title XVIII of the
20Social Security Act, or (iv) the provision of health care
21services, then the vendor shall be barred from participation
22for 5 years or for the length of the vendor's sentence for that
23conviction, whichever is longer. At the end of one year a
24vendor who has been terminated may apply for reinstatement to
25the program. Upon proper application to be reinstated such
26vendor may be deemed eligible by the Director providing that

 

 

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1such vendor meets the requirements for eligibility under this
2Code. If such vendor is deemed not eligible for reinstatement,
3he shall be barred from again applying for reinstatement for
4one year from the date his application for reinstatement is
5denied.
6    A vendor whose termination from participation in the
7Illinois medical assistance program under Article V was based
8solely on an action by a governmental entity other than the
9Illinois Department may, upon reinstatement by that
10governmental entity or upon reversal of the termination, apply
11for rescission of the termination from participation in the
12Illinois medical assistance program. Upon proper application
13for rescission, the vendor may be deemed eligible by the
14Director if the vendor meets the requirements for eligibility
15under this Code.
16    If a vendor has been terminated and reinstated to the
17medical assistance program under Article V and the vendor is
18terminated a second or subsequent time from the medical
19assistance program, the vendor shall be barred from
20participation for at least 2 years, except that if a vendor has
21been terminated a second time based on a conviction of a
22violation of Article VIIIA or a conviction of a felony based on
23fraud or a willful misrepresentation related to (i) the medical
24assistance program under Article V, (ii) a medical assistance
25program in another state that is of the kind provided under
26Article V, (iii) the Medicare program under Title XVIII of the

 

 

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1Social Security Act, or (iv) the provision of health care
2services, then the vendor shall be barred from participation
3for life. At the end of 2 years, a vendor who has been
4terminated may apply for reinstatement to the program. Upon
5application to be reinstated, the vendor may be deemed eligible
6if the vendor meets the requirements for eligibility under this
7Code. If the vendor is deemed not eligible for reinstatement,
8the vendor shall be barred from again applying for
9reinstatement for 2 years from the date the vendor's
10application for reinstatement is denied.
11    (E) The Illinois Department may recover money improperly or
12erroneously paid, or overpayments, either by setoff, crediting
13against future billings or by requiring direct repayment to the
14Illinois Department.
15    If the Illinois Department establishes through an
16administrative hearing that the overpayments resulted from the
17vendor or alternate payee willfully making, or causing to be
18made, a false statement or misrepresentation of a material fact
19in connection with billings and payments under the medical
20assistance program under Article V, the Department may recover
21interest on the amount of the overpayments at the rate of 5%
22per annum. For purposes of this paragraph, "willfully" means
23that a person makes a statement or representation with actual
24knowledge that it was false, or makes a statement or
25representation with knowledge of facts or information that
26would cause one to be aware that the statement or

 

 

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1representation was false when made.
2    (F) The Illinois Department may withhold payments to any
3vendor or alternate payee during the pendency of any proceeding
4under this Section. The Illinois Department shall state by rule
5with as much specificity as practicable the conditions under
6which payments will not be withheld during the pendency of any
7proceeding under this Section. Payments may be denied for bills
8submitted with service dates occurring during the pendency of a
9proceeding where the final administrative decision is to
10terminate eligibility to participate in the medical assistance
11program. The Illinois Department shall state by rule with as
12much specificity as practicable the conditions under which
13payments will not be denied for such bills. The Illinois
14Department shall state by rule a process and criteria by which
15a vendor or alternate payee may request full or partial release
16of payments withheld under this subsection. The Department must
17complete a proceeding under this Section in a timely manner.
18    (F-5) The Illinois Department may temporarily withhold
19payments to a vendor or alternate payee if any of the following
20individuals have been indicted or otherwise charged under a law
21of the United States or this or any other state with a felony
22offense that is based on alleged fraud or willful
23misrepresentation on the part of the individual related to (i)
24the medical assistance program under Article V of this Code,
25(ii) a medical assistance program provided in another state
26which is of the kind provided under Article V of this Code,

 

 

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1(iii) the Medicare program under Title XVIII of the Social
2Security Act, or (iv) the provision of health care services:
3        (1) If the vendor or alternate payee is a corporation:
4    an officer of the corporation or an individual who owns,
5    either directly or indirectly, 5% or more of the shares of
6    stock or other evidence of ownership of the corporation.
7        (2) If the vendor is a sole proprietorship: the owner
8    of the sole proprietorship.
9        (3) If the vendor or alternate payee is a partnership:
10    a partner in the partnership.
11        (4) If the vendor or alternate payee is any other
12    business entity authorized by law to transact business in
13    this State: an officer of the entity or an individual who
14    owns, either directly or indirectly, 5% or more of the
15    evidences of ownership of the entity.
16    If the Illinois Department withholds payments to a vendor
17or alternate payee under this subsection, the Department shall
18not release those payments to the vendor or alternate payee
19while any criminal proceeding related to the indictment or
20charge is pending unless the Department determines that there
21is good cause to release the payments before completion of the
22proceeding. If the indictment or charge results in the
23individual's conviction, the Illinois Department shall retain
24all withheld payments, which shall be considered forfeited to
25the Department. If the indictment or charge does not result in
26the individual's conviction, the Illinois Department shall

 

 

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1release to the vendor or alternate payee all withheld payments.
2    (G) The provisions of the Administrative Review Law, as now
3or hereafter amended, and the rules adopted pursuant thereto,
4shall apply to and govern all proceedings for the judicial
5review of final administrative decisions of the Illinois
6Department under this Section. The term "administrative
7decision" is defined as in Section 3-101 of the Code of Civil
8Procedure.
9    (G-5) Non-emergency transportation.
10        (1) Notwithstanding any other provision in this
11    Section, for non-emergency transportation vendors, the
12    Department may terminate the vendor from participation in
13    the medical assistance program prior to an evidentiary
14    hearing but after reasonable notice and opportunity to
15    respond as established by the Department by rule.
16        (2) Vendors of non-emergency medical transportation
17    services, as defined by the Department by rule, shall
18    submit to a fingerprint-based criminal background check on
19    current and future information available in the State
20    system and current information available through the
21    Federal Bureau of Investigation's system by submitting all
22    necessary fees and information in the form and manner
23    prescribed by the Department of State Police. The following
24    individuals shall be subject to the check:
25            (A) In the case of a vendor that is a corporation,
26        every shareholder who owns, directly or indirectly, 5%

 

 

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1        or more of the outstanding shares of the corporation.
2            (B) In the case of a vendor that is a partnership,
3        every partner.
4            (C) In the case of a vendor that is a sole
5        proprietorship, the sole proprietor.
6            (D) Each officer or manager of the vendor.
7        Each such vendor shall be responsible for payment of
8    the cost of the criminal background check.
9        (3) Vendors of non-emergency medical transportation
10    services may be required to post a surety bond. The
11    Department shall establish, by rule, the criteria and
12    requirements for determining when a surety bond must be
13    posted and the value of the bond.
14        (4) The Department, or its agents, may refuse to accept
15    requests for non-emergency transportation authorizations,
16    including prior-approval and post-approval requests, for a
17    specific non-emergency transportation vendor if:
18            (A) the Department has initiated a notice of
19        termination of the vendor from participation in the
20        medical assistance program; or
21            (B) the Department has issued notification of its
22        withholding of payments pursuant to subsection (F-5)
23        of this Section; or
24            (C) the Department has issued a notification of its
25        withholding of payments due to reliable evidence of
26        fraud or willful misrepresentation pending

 

 

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1        investigation.
2    (H) Nothing contained in this Code shall in any way limit
3or otherwise impair the authority or power of any State agency
4responsible for licensing of vendors.
5    (I) Based on a finding of noncompliance on the part of a
6nursing home with any requirement for certification under Title
7XVIII or XIX of the Social Security Act (42 U.S.C. Sec. 1395 et
8seq. or 42 U.S.C. Sec. 1396 et seq.), the Illinois Department
9may impose one or more of the following remedies after notice
10to the facility:
11        (1) Termination of the provider agreement.
12        (2) Temporary management.
13        (3) Denial of payment for new admissions.
14        (4) Civil money penalties.
15        (5) Closure of the facility in emergency situations or
16    transfer of residents, or both.
17        (6) State monitoring.
18        (7) Denial of all payments when the Health Care Finance
19    Administration has imposed this sanction.
20    The Illinois Department shall by rule establish criteria
21governing continued payments to a nursing facility subsequent
22to termination of the facility's provider agreement if, in the
23sole discretion of the Illinois Department, circumstances
24affecting the health, safety, and welfare of the facility's
25residents require those continued payments. The Illinois
26Department may condition those continued payments on the

 

 

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1appointment of temporary management, sale of the facility to
2new owners or operators, or other arrangements that the
3Illinois Department determines best serve the needs of the
4facility's residents.
5    Except in the case of a facility that has a right to a
6hearing on the finding of noncompliance before an agency of the
7federal government, a facility may request a hearing before a
8State agency on any finding of noncompliance within 60 days
9after the notice of the intent to impose a remedy. Except in
10the case of civil money penalties, a request for a hearing
11shall not delay imposition of the penalty. The choice of
12remedies is not appealable at a hearing. The level of
13noncompliance may be challenged only in the case of a civil
14money penalty. The Illinois Department shall provide by rule
15for the State agency that will conduct the evidentiary
16hearings.
17    The Illinois Department may collect interest on unpaid
18civil money penalties.
19    The Illinois Department may adopt all rules necessary to
20implement this subsection (I).
21    (J) The Illinois Department, by rule, may permit individual
22practitioners to designate that Department payments that may be
23due the practitioner be made to an alternate payee or alternate
24payees.
25        (a) Such alternate payee or alternate payees shall be
26    required to register as an alternate payee in the Medical

 

 

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1    Assistance Program with the Illinois Department.
2        (b) If a practitioner designates an alternate payee,
3    the alternate payee and practitioner shall be jointly and
4    severally liable to the Department for payments made to the
5    alternate payee. Pursuant to subsection (E) of this
6    Section, any Department action to recover money or
7    overpayments from an alternate payee shall be subject to an
8    administrative hearing.
9        (c) Registration as an alternate payee or alternate
10    payees in the Illinois Medical Assistance Program shall be
11    conditional. At any time, the Illinois Department may deny
12    or cancel any alternate payee's registration in the
13    Illinois Medical Assistance Program without cause. Any
14    such denial or cancellation is not subject to an
15    administrative hearing.
16        (d) The Illinois Department may seek a revocation of
17    any alternate payee, and all owners, officers, and
18    individuals with management responsibility for such
19    alternate payee shall be permanently prohibited from
20    participating as an owner, an officer, or an individual
21    with management responsibility with an alternate payee in
22    the Illinois Medical Assistance Program, if after
23    reasonable notice and opportunity for a hearing the
24    Illinois Department finds that:
25            (1) the alternate payee is not complying with the
26        Department's policy or rules and regulations, or with

 

 

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1        the terms and conditions prescribed by the Illinois
2        Department in its alternate payee registration
3        agreement; or
4            (2) the alternate payee has failed to keep or make
5        available for inspection, audit, or copying, after
6        receiving a written request from the Illinois
7        Department, such records regarding payments claimed as
8        an alternate payee; or
9            (3) the alternate payee has failed to furnish any
10        information requested by the Illinois Department
11        regarding payments claimed as an alternate payee; or
12            (4) the alternate payee has knowingly made, or
13        caused to be made, any false statement or
14        representation of a material fact in connection with
15        the administration of the Illinois Medical Assistance
16        Program; or
17            (5) the alternate payee, a person with management
18        responsibility for an alternate payee, an officer or
19        person owning, either directly or indirectly, 5% or
20        more of the shares of stock or other evidences of
21        ownership in a corporate alternate payee, or a partner
22        in a partnership which is an alternate payee:
23                (a) was previously terminated from
24            participation as a vendor in the Illinois Medical
25            Assistance Program, or was previously revoked as
26            an alternate payee in the Illinois Medical

 

 

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1            Assistance Program, or was terminated from
2            participation as a vendor in a medical assistance
3            program in another state that is of the same kind
4            as the program of medical assistance provided
5            under Article V of this Code; or
6                (b) was a person with management
7            responsibility for a vendor previously terminated
8            from participation as a vendor in the Illinois
9            Medical Assistance Program, or was previously
10            revoked as an alternate payee in the Illinois
11            Medical Assistance Program, or was terminated from
12            participation as a vendor in a medical assistance
13            program in another state that is of the same kind
14            as the program of medical assistance provided
15            under Article V of this Code, during the time of
16            conduct which was the basis for that vendor's
17            termination or alternate payee's revocation; or
18                (c) was an officer, or person owning, either
19            directly or indirectly, 5% or more of the shares of
20            stock or other evidences of ownership in a
21            corporate vendor previously terminated from
22            participation as a vendor in the Illinois Medical
23            Assistance Program, or was previously revoked as
24            an alternate payee in the Illinois Medical
25            Assistance Program, or was terminated from
26            participation as a vendor in a medical assistance

 

 

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1            program in another state that is of the same kind
2            as the program of medical assistance provided
3            under Article V of this Code, during the time of
4            conduct which was the basis for that vendor's
5            termination; or
6                (d) was an owner of a sole proprietorship or
7            partner in a partnership previously terminated
8            from participation as a vendor in the Illinois
9            Medical Assistance Program, or was previously
10            revoked as an alternate payee in the Illinois
11            Medical Assistance Program, or was terminated from
12            participation as a vendor in a medical assistance
13            program in another state that is of the same kind
14            as the program of medical assistance provided
15            under Article V of this Code, during the time of
16            conduct which was the basis for that vendor's
17            termination or alternate payee's revocation; or
18            (6) the alternate payee, a person with management
19        responsibility for an alternate payee, an officer or
20        person owning, either directly or indirectly, 5% or
21        more of the shares of stock or other evidences of
22        ownership in a corporate alternate payee, or a partner
23        in a partnership which is an alternate payee:
24                (a) has engaged in conduct prohibited by
25            applicable federal or State law or regulation
26            relating to the Illinois Medical Assistance

 

 

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1            Program; or
2                (b) was a person with management
3            responsibility for a vendor or alternate payee at
4            the time that the vendor or alternate payee engaged
5            in practices prohibited by applicable federal or
6            State law or regulation relating to the Illinois
7            Medical Assistance Program; or
8                (c) was an officer, or person owning, either
9            directly or indirectly, 5% or more of the shares of
10            stock or other evidences of ownership in a vendor
11            or alternate payee at the time such vendor or
12            alternate payee engaged in practices prohibited by
13            applicable federal or State law or regulation
14            relating to the Illinois Medical Assistance
15            Program; or
16                (d) was an owner of a sole proprietorship or
17            partner in a partnership which was a vendor or
18            alternate payee at the time such vendor or
19            alternate payee engaged in practices prohibited by
20            applicable federal or State law or regulation
21            relating to the Illinois Medical Assistance
22            Program; or
23            (7) the direct or indirect ownership of the vendor
24        or alternate payee (including the ownership of a vendor
25        or alternate payee that is a partner's interest in a
26        vendor or alternate payee, or ownership of 5% or more

 

 

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1        of the shares of stock or other evidences of ownership
2        in a corporate vendor or alternate payee) has been
3        transferred by an individual who is terminated or
4        barred from participating as a vendor or is prohibited
5        or revoked as an alternate payee to the individual's
6        spouse, child, brother, sister, parent, grandparent,
7        grandchild, uncle, aunt, niece, nephew, cousin, or
8        relative by marriage.
9    (K) The Illinois Department of Healthcare and Family
10Services may withhold payments, in whole or in part, to a
11provider or alternate payee upon receipt of evidence, received
12from State or federal law enforcement or federal oversight
13agencies or from the results of a preliminary Department audit
14and determined by the Department to be credible, that the
15circumstances giving rise to the need for a withholding of
16payments may involve fraud or willful misrepresentation under
17the Illinois Medical Assistance program. The Department shall
18by rule define what constitutes "credible" evidence for
19purposes of this subsection. The Department may withhold
20payments without first notifying the provider or alternate
21payee of its intention to withhold such payments. A provider or
22alternate payee may request a reconsideration of payment
23withholding, and the Department must grant such a request. The
24Department shall state by rule a process and criteria by which
25a provider or alternate payee may request full or partial
26release of payments withheld under this subsection. This

 

 

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1request may be made at any time after the Department first
2withholds such payments.
3        (a) The Illinois Department must send notice of its
4    withholding of program payments within 5 days of taking
5    such action. The notice must set forth the general
6    allegations as to the nature of the withholding action, but
7    need not disclose any specific information concerning its
8    ongoing investigation. The notice must do all of the
9    following:
10            (1) State that payments are being withheld in
11        accordance with this subsection.
12            (2) State that the withholding is for a temporary
13        period, as stated in paragraph (b) of this subsection,
14        and cite the circumstances under which withholding
15        will be terminated.
16            (3) Specify, when appropriate, which type or types
17        of Medicaid claims withholding is effective.
18            (4) Inform the provider or alternate payee of the
19        right to submit written evidence for reconsideration
20        of the withholding by the Illinois Department.
21            (5) Inform the provider or alternate payee that a
22        written request may be made to the Illinois Department
23        for full or partial release of withheld payments and
24        that such requests may be made at any time after the
25        Department first withholds such payments.
26        (b) All withholding-of-payment actions under this

 

 

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1    subsection shall be temporary and shall not continue after
2    any of the following:
3            (1) The Illinois Department or the prosecuting
4        authorities determine that there is insufficient
5        evidence of fraud or willful misrepresentation by the
6        provider or alternate payee.
7            (2) Legal proceedings related to the provider's or
8        alternate payee's alleged fraud, willful
9        misrepresentation, violations of this Act, or
10        violations of the Illinois Department's administrative
11        rules are completed.
12            (3) The withholding of payments for a period of 3
13        years.
14        (c) The Illinois Department may adopt all rules
15    necessary to implement this subsection (K).
16    (L) The Department of Healthcare and Family Services shall
17not require a practitioner-owned group practice, partnership,
18or corporation to have a set number of licensed
19practitioner-owners who are eligible to provide medical
20services under this Code in order for the practitioner-owned
21group practice, partnership, or corporation to qualify as an
22alternate payee under the State's medical assistance program.
23The Department shall not prohibit a corporate entity that
24employs health care providers from participating as an
25alternate payee under the State's medical assistance program if
26the corporation is organized for the purpose of providing

 

 

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1medical or other health care services.
2(Source: P.A. 94-265, eff. 1-1-06; 94-975, eff. 6-30-06.)
 
3    Section 99. Effective date. This Act takes effect upon
4becoming law.