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90_HB0776
305 ILCS 5/5-16.3
Amends the Medicaid Article of the Public Aid Code. In
the Section concerning the integrated health care program,
provides that a managed health care entity may not engage in
door-to-door and certain other marketing activities.
Requires that the Department of Public Aid approve an
entity's marketing plan. Authorizes the Department of Public
Aid Inspector General to investigate entities' marketing
practices. Effective immediately.
LRB9000964DJcd
LRB9000964DJcd
1 AN ACT to amend the Illinois Public Aid Code by changing
2 Section 5-16.3.
3 Be it enacted by the People of the State of Illinois,
4 represented in the General Assembly:
5 Section 5. The Illinois Public Aid Code is amended by
6 changing Section 5-16.3 as follows:
7 (305 ILCS 5/5-16.3)
8 (Text of Section before amendment by P.A. 89-507)
9 Sec. 5-16.3. System for integrated health care services.
10 (a) It shall be the public policy of the State to adopt,
11 to the extent practicable, a health care program that
12 encourages the integration of health care services and
13 manages the health care of program enrollees while preserving
14 reasonable choice within a competitive and cost-efficient
15 environment. In furtherance of this public policy, the
16 Illinois Department shall develop and implement an integrated
17 health care program consistent with the provisions of this
18 Section. The provisions of this Section apply only to the
19 integrated health care program created under this Section.
20 Persons enrolled in the integrated health care program, as
21 determined by the Illinois Department by rule, shall be
22 afforded a choice among health care delivery systems, which
23 shall include, but are not limited to, (i) fee for service
24 care managed by a primary care physician licensed to practice
25 medicine in all its branches, (ii) managed health care
26 entities, and (iii) federally qualified health centers
27 (reimbursed according to a prospective cost-reimbursement
28 methodology) and rural health clinics (reimbursed according
29 to the Medicare methodology), where available. Persons
30 enrolled in the integrated health care program also may be
31 offered indemnity insurance plans, subject to availability.
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1 For purposes of this Section, a "managed health care
2 entity" means a health maintenance organization or a managed
3 care community network as defined in this Section. A "health
4 maintenance organization" means a health maintenance
5 organization as defined in the Health Maintenance
6 Organization Act. A "managed care community network" means
7 an entity, other than a health maintenance organization, that
8 is owned, operated, or governed by providers of health care
9 services within this State and that provides or arranges
10 primary, secondary, and tertiary managed health care services
11 under contract with the Illinois Department exclusively to
12 enrollees of the integrated health care program. A managed
13 care community network may contract with the Illinois
14 Department to provide only pediatric health care services. A
15 county provider as defined in Section 15-1 of this Code may
16 contract with the Illinois Department to provide services to
17 enrollees of the integrated health care program as a managed
18 care community network without the need to establish a
19 separate entity that provides services exclusively to
20 enrollees of the integrated health care program and shall be
21 deemed a managed care community network for purposes of this
22 Code only to the extent of the provision of services to those
23 enrollees in conjunction with the integrated health care
24 program. A county provider shall be entitled to contract
25 with the Illinois Department with respect to any contracting
26 region located in whole or in part within the county. A
27 county provider shall not be required to accept enrollees who
28 do not reside within the county.
29 Each managed care community network must demonstrate its
30 ability to bear the financial risk of serving enrollees under
31 this program. The Illinois Department shall by rule adopt
32 criteria for assessing the financial soundness of each
33 managed care community network. These rules shall consider
34 the extent to which a managed care community network is
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1 comprised of providers who directly render health care and
2 are located within the community in which they seek to
3 contract rather than solely arrange or finance the delivery
4 of health care. These rules shall further consider a variety
5 of risk-bearing and management techniques, including the
6 sufficiency of quality assurance and utilization management
7 programs and whether a managed care community network has
8 sufficiently demonstrated its financial solvency and net
9 worth. The Illinois Department's criteria must be based on
10 sound actuarial, financial, and accounting principles. In
11 adopting these rules, the Illinois Department shall consult
12 with the Illinois Department of Insurance. The Illinois
13 Department is responsible for monitoring compliance with
14 these rules.
15 This Section may not be implemented before the effective
16 date of these rules, the approval of any necessary federal
17 waivers, and the completion of the review of an application
18 submitted, at least 60 days before the effective date of
19 rules adopted under this Section, to the Illinois Department
20 by a managed care community network.
21 All health care delivery systems that contract with the
22 Illinois Department under the integrated health care program
23 shall clearly recognize a health care provider's right of
24 conscience under the Right of Conscience Act. In addition to
25 the provisions of that Act, no health care delivery system
26 that contracts with the Illinois Department under the
27 integrated health care program shall be required to provide,
28 arrange for, or pay for any health care or medical service,
29 procedure, or product if that health care delivery system is
30 owned, controlled, or sponsored by or affiliated with a
31 religious institution or religious organization that finds
32 that health care or medical service, procedure, or product to
33 violate its religious and moral teachings and beliefs.
34 (b) The Illinois Department may, by rule, provide for
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1 different benefit packages for different categories of
2 persons enrolled in the program. Mental health services,
3 alcohol and substance abuse services, services related to
4 children with chronic or acute conditions requiring
5 longer-term treatment and follow-up, and rehabilitation care
6 provided by a free-standing rehabilitation hospital or a
7 hospital rehabilitation unit may be excluded from a benefit
8 package if the State ensures that those services are made
9 available through a separate delivery system. An exclusion
10 does not prohibit the Illinois Department from developing and
11 implementing demonstration projects for categories of persons
12 or services. Benefit packages for persons eligible for
13 medical assistance under Articles V, VI, and XII shall be
14 based on the requirements of those Articles and shall be
15 consistent with the Title XIX of the Social Security Act.
16 Nothing in this Act shall be construed to apply to services
17 purchased by the Department of Children and Family Services
18 and the Department of Mental Health and Developmental
19 Disabilities under the provisions of Title 59 of the Illinois
20 Administrative Code, Part 132 ("Medicaid Community Mental
21 Health Services Program").
22 (c) The program established by this Section may be
23 implemented by the Illinois Department in various contracting
24 areas at various times. The health care delivery systems and
25 providers available under the program may vary throughout the
26 State. For purposes of contracting with managed health care
27 entities and providers, the Illinois Department shall
28 establish contracting areas similar to the geographic areas
29 designated by the Illinois Department for contracting
30 purposes under the Illinois Competitive Access and
31 Reimbursement Equity Program (ICARE) under the authority of
32 Section 3-4 of the Illinois Health Finance Reform Act or
33 similarly-sized or smaller geographic areas established by
34 the Illinois Department by rule. A managed health care entity
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1 shall be permitted to contract in any geographic areas for
2 which it has a sufficient provider network and otherwise
3 meets the contracting terms of the State. The Illinois
4 Department is not prohibited from entering into a contract
5 with a managed health care entity at any time.
6 (c-5) A managed health care entity may not engage in
7 door-to-door marketing activities or marketing activities at
8 an office of the Illinois Department or a county department
9 in order to enroll in the entity's health care delivery
10 system persons who are enrolled in the integrated health care
11 program established under this Section.
12 Before a managed health care entity may market its health
13 care delivery system to persons enrolled in the integrated
14 health care program established under this Section, the
15 Illinois Department must approve a marketing plan submitted
16 by the entity to the Illinois Department. The Illinois
17 Department shall adopt guidelines for approving marketing
18 plans submitted by managed health care entities under this
19 subsection. Besides prohibiting door-to-door marketing
20 activities and marketing activities at public aid offices,
21 the guidelines shall include at least the following:
22 (1) A managed health care entity may not offer or
23 provide any gift, favor, or other inducement in marketing
24 its health care delivery system to integrated health care
25 program enrollees.
26 (2) All persons employed or otherwise engaged by a
27 managed health care entity to market the entity's health
28 care delivery system to integrated health care program
29 enrollees or to supervise that marketing shall register
30 with the Illinois Department.
31 The Inspector General appointed under Section 12-13.1 may
32 conduct investigations to determine whether the marketing
33 practices of managed health care entities participating in
34 the integrated health care program comply with the
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1 guidelines.
2 (d) A managed health care entity that contracts with the
3 Illinois Department for the provision of services under the
4 program shall do all of the following, solely for purposes of
5 the integrated health care program:
6 (1) Provide that any individual physician licensed
7 to practice medicine in all its branches, any pharmacy,
8 any federally qualified health center, and any
9 podiatrist, that consistently meets the reasonable terms
10 and conditions established by the managed health care
11 entity, including but not limited to credentialing
12 standards, quality assurance program requirements,
13 utilization management requirements, financial
14 responsibility standards, contracting process
15 requirements, and provider network size and accessibility
16 requirements, must be accepted by the managed health care
17 entity for purposes of the Illinois integrated health
18 care program. Any individual who is either terminated
19 from or denied inclusion in the panel of physicians of
20 the managed health care entity shall be given, within 10
21 business days after that determination, a written
22 explanation of the reasons for his or her exclusion or
23 termination from the panel. This paragraph (1) does not
24 apply to the following:
25 (A) A managed health care entity that
26 certifies to the Illinois Department that:
27 (i) it employs on a full-time basis 125
28 or more Illinois physicians licensed to
29 practice medicine in all of its branches; and
30 (ii) it will provide medical services
31 through its employees to more than 80% of the
32 recipients enrolled with the entity in the
33 integrated health care program; or
34 (B) A domestic stock insurance company
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1 licensed under clause (b) of class 1 of Section 4 of
2 the Illinois Insurance Code if (i) at least 66% of
3 the stock of the insurance company is owned by a
4 professional corporation organized under the
5 Professional Service Corporation Act that has 125 or
6 more shareholders who are Illinois physicians
7 licensed to practice medicine in all of its branches
8 and (ii) the insurance company certifies to the
9 Illinois Department that at least 80% of those
10 physician shareholders will provide services to
11 recipients enrolled with the company in the
12 integrated health care program.
13 (2) Provide for reimbursement for providers for
14 emergency care, as defined by the Illinois Department by
15 rule, that must be provided to its enrollees, including
16 an emergency room screening fee, and urgent care that it
17 authorizes for its enrollees, regardless of the
18 provider's affiliation with the managed health care
19 entity. Providers shall be reimbursed for emergency care
20 at an amount equal to the Illinois Department's
21 fee-for-service rates for those medical services rendered
22 by providers not under contract with the managed health
23 care entity to enrollees of the entity.
24 (3) Provide that any provider affiliated with a
25 managed health care entity may also provide services on a
26 fee-for-service basis to Illinois Department clients not
27 enrolled in a managed health care entity.
28 (4) Provide client education services as determined
29 and approved by the Illinois Department, including but
30 not limited to (i) education regarding appropriate
31 utilization of health care services in a managed care
32 system, (ii) written disclosure of treatment policies and
33 any restrictions or limitations on health services,
34 including, but not limited to, physical services,
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1 clinical laboratory tests, hospital and surgical
2 procedures, prescription drugs and biologics, and
3 radiological examinations, and (iii) written notice that
4 the enrollee may receive from another provider those
5 services covered under this program that are not provided
6 by the managed health care entity.
7 (5) Provide that enrollees within its system may
8 choose the site for provision of services and the panel
9 of health care providers.
10 (6) Not discriminate in its enrollment or
11 disenrollment practices among recipients of medical
12 services or program enrollees based on health status.
13 (7) Provide a quality assurance and utilization
14 review program that (i) for health maintenance
15 organizations meets the requirements of the Health
16 Maintenance Organization Act and (ii) for managed care
17 community networks meets the requirements established by
18 the Illinois Department in rules that incorporate those
19 standards set forth in the Health Maintenance
20 Organization Act.
21 (8) Issue a managed health care entity
22 identification card to each enrollee upon enrollment.
23 The card must contain all of the following:
24 (A) The enrollee's signature.
25 (B) The enrollee's health plan.
26 (C) The name and telephone number of the
27 enrollee's primary care physician.
28 (D) A telephone number to be used for
29 emergency service 24 hours per day, 7 days per week.
30 The telephone number required to be maintained
31 pursuant to this subparagraph by each managed health
32 care entity shall, at minimum, be staffed by
33 medically trained personnel and be provided
34 directly, or under arrangement, at an office or
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1 offices in locations maintained solely within the
2 State of Illinois. For purposes of this
3 subparagraph, "medically trained personnel" means
4 licensed practical nurses or registered nurses
5 located in the State of Illinois who are licensed
6 pursuant to the Illinois Nursing Act of 1987.
7 (9) Ensure that every primary care physician and
8 pharmacy in the managed health care entity meets the
9 standards established by the Illinois Department for
10 accessibility and quality of care. The Illinois
11 Department shall arrange for and oversee an evaluation of
12 the standards established under this paragraph (9) and
13 may recommend any necessary changes to these standards.
14 The Illinois Department shall submit an annual report to
15 the Governor and the General Assembly by April 1 of each
16 year regarding the effect of the standards on ensuring
17 access and quality of care to enrollees.
18 (10) Provide a procedure for handling complaints
19 that (i) for health maintenance organizations meets the
20 requirements of the Health Maintenance Organization Act
21 and (ii) for managed care community networks meets the
22 requirements established by the Illinois Department in
23 rules that incorporate those standards set forth in the
24 Health Maintenance Organization Act.
25 (11) Maintain, retain, and make available to the
26 Illinois Department records, data, and information, in a
27 uniform manner determined by the Illinois Department,
28 sufficient for the Illinois Department to monitor
29 utilization, accessibility, and quality of care.
30 (12) Except for providers who are prepaid, pay all
31 approved claims for covered services that are completed
32 and submitted to the managed health care entity within 30
33 days after receipt of the claim or receipt of the
34 appropriate capitation payment or payments by the managed
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1 health care entity from the State for the month in which
2 the services included on the claim were rendered,
3 whichever is later. If payment is not made or mailed to
4 the provider by the managed health care entity by the due
5 date under this subsection, an interest penalty of 1% of
6 any amount unpaid shall be added for each month or
7 fraction of a month after the due date, until final
8 payment is made. Nothing in this Section shall prohibit
9 managed health care entities and providers from mutually
10 agreeing to terms that require more timely payment.
11 (13) Provide integration with community-based
12 programs provided by certified local health departments
13 such as Women, Infants, and Children Supplemental Food
14 Program (WIC), childhood immunization programs, health
15 education programs, case management programs, and health
16 screening programs.
17 (14) Provide that the pharmacy formulary used by a
18 managed health care entity and its contract providers be
19 no more restrictive than the Illinois Department's
20 pharmaceutical program on the effective date of this
21 amendatory Act of 1994 and as amended after that date.
22 (15) Provide integration with community-based
23 organizations, including, but not limited to, any
24 organization that has operated within a Medicaid
25 Partnership as defined by this Code or by rule of the
26 Illinois Department, that may continue to operate under a
27 contract with the Illinois Department or a managed health
28 care entity under this Section to provide case management
29 services to Medicaid clients in designated high-need
30 areas.
31 The Illinois Department may, by rule, determine
32 methodologies to limit financial liability for managed health
33 care entities resulting from payment for services to
34 enrollees provided under the Illinois Department's integrated
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1 health care program. Any methodology so determined may be
2 considered or implemented by the Illinois Department through
3 a contract with a managed health care entity under this
4 integrated health care program.
5 The Illinois Department shall contract with an entity or
6 entities to provide external peer-based quality assurance
7 review for the integrated health care program. The entity
8 shall be representative of Illinois physicians licensed to
9 practice medicine in all its branches and have statewide
10 geographic representation in all specialties of medical care
11 that are provided within the integrated health care program.
12 The entity may not be a third party payer and shall maintain
13 offices in locations around the State in order to provide
14 service and continuing medical education to physician
15 participants within the integrated health care program. The
16 review process shall be developed and conducted by Illinois
17 physicians licensed to practice medicine in all its branches.
18 In consultation with the entity, the Illinois Department may
19 contract with other entities for professional peer-based
20 quality assurance review of individual categories of services
21 other than services provided, supervised, or coordinated by
22 physicians licensed to practice medicine in all its branches.
23 The Illinois Department shall establish, by rule, criteria to
24 avoid conflicts of interest in the conduct of quality
25 assurance activities consistent with professional peer-review
26 standards. All quality assurance activities shall be
27 coordinated by the Illinois Department.
28 (e) All persons enrolled in the program shall be
29 provided with a full written explanation of all
30 fee-for-service and managed health care plan options and a
31 reasonable opportunity to choose among the options as
32 provided by rule. The Illinois Department shall provide to
33 enrollees, upon enrollment in the integrated health care
34 program and at least annually thereafter, notice of the
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1 process for requesting an appeal under the Illinois
2 Department's administrative appeal procedures.
3 Notwithstanding any other Section of this Code, the Illinois
4 Department may provide by rule for the Illinois Department to
5 assign a person enrolled in the program to a specific
6 provider of medical services or to a specific health care
7 delivery system if an enrollee has failed to exercise choice
8 in a timely manner. An enrollee assigned by the Illinois
9 Department shall be afforded the opportunity to disenroll and
10 to select a specific provider of medical services or a
11 specific health care delivery system within the first 30 days
12 after the assignment. An enrollee who has failed to exercise
13 choice in a timely manner may be assigned only if there are 3
14 or more managed health care entities contracting with the
15 Illinois Department within the contracting area, except that,
16 outside the City of Chicago, this requirement may be waived
17 for an area by rules adopted by the Illinois Department after
18 consultation with all hospitals within the contracting area.
19 The Illinois Department shall establish by rule the procedure
20 for random assignment of enrollees who fail to exercise
21 choice in a timely manner to a specific managed health care
22 entity in proportion to the available capacity of that
23 managed health care entity. Assignment to a specific provider
24 of medical services or to a specific managed health care
25 entity may not exceed that provider's or entity's capacity as
26 determined by the Illinois Department. Any person who has
27 chosen a specific provider of medical services or a specific
28 managed health care entity, or any person who has been
29 assigned under this subsection, shall be given the
30 opportunity to change that choice or assignment at least once
31 every 12 months, as determined by the Illinois Department by
32 rule. The Illinois Department shall maintain a toll-free
33 telephone number for program enrollees' use in reporting
34 problems with managed health care entities.
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1 (f) If a person becomes eligible for participation in
2 the integrated health care program while he or she is
3 hospitalized, the Illinois Department may not enroll that
4 person in the program until after he or she has been
5 discharged from the hospital. This subsection does not apply
6 to newborn infants whose mothers are enrolled in the
7 integrated health care program.
8 (g) The Illinois Department shall, by rule, establish
9 for managed health care entities rates that (i) are certified
10 to be actuarially sound, as determined by an actuary who is
11 an associate or a fellow of the Society of Actuaries or a
12 member of the American Academy of Actuaries and who has
13 expertise and experience in medical insurance and benefit
14 programs, in accordance with the Illinois Department's
15 current fee-for-service payment system, and (ii) take into
16 account any difference of cost to provide health care to
17 different populations based on gender, age, location, and
18 eligibility category. The rates for managed health care
19 entities shall be determined on a capitated basis.
20 The Illinois Department by rule shall establish a method
21 to adjust its payments to managed health care entities in a
22 manner intended to avoid providing any financial incentive to
23 a managed health care entity to refer patients to a county
24 provider, in an Illinois county having a population greater
25 than 3,000,000, that is paid directly by the Illinois
26 Department. The Illinois Department shall by April 1, 1997,
27 and annually thereafter, review the method to adjust
28 payments. Payments by the Illinois Department to the county
29 provider, for persons not enrolled in a managed care
30 community network owned or operated by a county provider,
31 shall be paid on a fee-for-service basis under Article XV of
32 this Code.
33 The Illinois Department by rule shall establish a method
34 to reduce its payments to managed health care entities to
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1 take into consideration (i) any adjustment payments paid to
2 hospitals under subsection (h) of this Section to the extent
3 those payments, or any part of those payments, have been
4 taken into account in establishing capitated rates under this
5 subsection (g) and (ii) the implementation of methodologies
6 to limit financial liability for managed health care entities
7 under subsection (d) of this Section.
8 (h) For hospital services provided by a hospital that
9 contracts with a managed health care entity, adjustment
10 payments shall be paid directly to the hospital by the
11 Illinois Department. Adjustment payments may include but
12 need not be limited to adjustment payments to:
13 disproportionate share hospitals under Section 5-5.02 of this
14 Code; primary care access health care education payments (89
15 Ill. Adm. Code 149.140); payments for capital, direct medical
16 education, indirect medical education, certified registered
17 nurse anesthetist, and kidney acquisition costs (89 Ill. Adm.
18 Code 149.150(c)); uncompensated care payments (89 Ill. Adm.
19 Code 148.150(h)); trauma center payments (89 Ill. Adm. Code
20 148.290(c)); rehabilitation hospital payments (89 Ill. Adm.
21 Code 148.290(d)); perinatal center payments (89 Ill. Adm.
22 Code 148.290(e)); obstetrical care payments (89 Ill. Adm.
23 Code 148.290(f)); targeted access payments (89 Ill. Adm. Code
24 148.290(g)); Medicaid high volume payments (89 Ill. Adm. Code
25 148.290(h)); and outpatient indigent volume adjustments (89
26 Ill. Adm. Code 148.140(b)(5)).
27 (i) For any hospital eligible for the adjustment
28 payments described in subsection (h), the Illinois Department
29 shall maintain, through the period ending June 30, 1995,
30 reimbursement levels in accordance with statutes and rules in
31 effect on April 1, 1994.
32 (j) Nothing contained in this Code in any way limits or
33 otherwise impairs the authority or power of the Illinois
34 Department to enter into a negotiated contract pursuant to
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1 this Section with a managed health care entity, including,
2 but not limited to, a health maintenance organization, that
3 provides for termination or nonrenewal of the contract
4 without cause upon notice as provided in the contract and
5 without a hearing.
6 (k) Section 5-5.15 does not apply to the program
7 developed and implemented pursuant to this Section.
8 (l) The Illinois Department shall, by rule, define those
9 chronic or acute medical conditions of childhood that require
10 longer-term treatment and follow-up care. The Illinois
11 Department shall ensure that services required to treat these
12 conditions are available through a separate delivery system.
13 A managed health care entity that contracts with the
14 Illinois Department may refer a child with medical conditions
15 described in the rules adopted under this subsection directly
16 to a children's hospital or to a hospital, other than a
17 children's hospital, that is qualified to provide inpatient
18 and outpatient services to treat those conditions. The
19 Illinois Department shall provide fee-for-service
20 reimbursement directly to a children's hospital for those
21 services pursuant to Title 89 of the Illinois Administrative
22 Code, Section 148.280(a), at a rate at least equal to the
23 rate in effect on March 31, 1994. For hospitals, other than
24 children's hospitals, that are qualified to provide inpatient
25 and outpatient services to treat those conditions, the
26 Illinois Department shall provide reimbursement for those
27 services on a fee-for-service basis, at a rate at least equal
28 to the rate in effect for those other hospitals on March 31,
29 1994.
30 A children's hospital shall be directly reimbursed for
31 all services provided at the children's hospital on a
32 fee-for-service basis pursuant to Title 89 of the Illinois
33 Administrative Code, Section 148.280(a), at a rate at least
34 equal to the rate in effect on March 31, 1994, until the
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1 later of (i) implementation of the integrated health care
2 program under this Section and development of actuarially
3 sound capitation rates for services other than those chronic
4 or acute medical conditions of childhood that require
5 longer-term treatment and follow-up care as defined by the
6 Illinois Department in the rules adopted under this
7 subsection or (ii) March 31, 1996.
8 Notwithstanding anything in this subsection to the
9 contrary, a managed health care entity shall not consider
10 sources or methods of payment in determining the referral of
11 a child. The Illinois Department shall adopt rules to
12 establish criteria for those referrals. The Illinois
13 Department by rule shall establish a method to adjust its
14 payments to managed health care entities in a manner intended
15 to avoid providing any financial incentive to a managed
16 health care entity to refer patients to a provider who is
17 paid directly by the Illinois Department.
18 (m) Behavioral health services provided or funded by the
19 Department of Mental Health and Developmental Disabilities,
20 the Department of Alcoholism and Substance Abuse, the
21 Department of Children and Family Services, and the Illinois
22 Department shall be excluded from a benefit package.
23 Conditions of an organic or physical origin or nature,
24 including medical detoxification, however, may not be
25 excluded. In this subsection, "behavioral health services"
26 means mental health services and subacute alcohol and
27 substance abuse treatment services, as defined in the
28 Illinois Alcoholism and Other Drug Dependency Act. In this
29 subsection, "mental health services" includes, at a minimum,
30 the following services funded by the Illinois Department, the
31 Department of Mental Health and Developmental Disabilities,
32 or the Department of Children and Family Services: (i)
33 inpatient hospital services, including related physician
34 services, related psychiatric interventions, and
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1 pharmaceutical services provided to an eligible recipient
2 hospitalized with a primary diagnosis of psychiatric
3 disorder; (ii) outpatient mental health services as defined
4 and specified in Title 59 of the Illinois Administrative
5 Code, Part 132; (iii) any other outpatient mental health
6 services funded by the Illinois Department pursuant to the
7 State of Illinois Medicaid Plan; (iv) partial
8 hospitalization; and (v) follow-up stabilization related to
9 any of those services. Additional behavioral health services
10 may be excluded under this subsection as mutually agreed in
11 writing by the Illinois Department and the affected State
12 agency or agencies. The exclusion of any service does not
13 prohibit the Illinois Department from developing and
14 implementing demonstration projects for categories of persons
15 or services. The Department of Mental Health and
16 Developmental Disabilities, the Department of Children and
17 Family Services, and the Department of Alcoholism and
18 Substance Abuse shall each adopt rules governing the
19 integration of managed care in the provision of behavioral
20 health services. The State shall integrate managed care
21 community networks and affiliated providers, to the extent
22 practicable, in any separate delivery system for mental
23 health services.
24 (n) The Illinois Department shall adopt rules to
25 establish reserve requirements for managed care community
26 networks, as required by subsection (a), and health
27 maintenance organizations to protect against liabilities in
28 the event that a managed health care entity is declared
29 insolvent or bankrupt. If a managed health care entity other
30 than a county provider is declared insolvent or bankrupt,
31 after liquidation and application of any available assets,
32 resources, and reserves, the Illinois Department shall pay a
33 portion of the amounts owed by the managed health care entity
34 to providers for services rendered to enrollees under the
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1 integrated health care program under this Section based on
2 the following schedule: (i) from April 1, 1995 through June
3 30, 1998, 90% of the amounts owed; (ii) from July 1, 1998
4 through June 30, 2001, 80% of the amounts owed; and (iii)
5 from July 1, 2001 through June 30, 2005, 75% of the amounts
6 owed. The amounts paid under this subsection shall be
7 calculated based on the total amount owed by the managed
8 health care entity to providers before application of any
9 available assets, resources, and reserves. After June 30,
10 2005, the Illinois Department may not pay any amounts owed to
11 providers as a result of an insolvency or bankruptcy of a
12 managed health care entity occurring after that date. The
13 Illinois Department is not obligated, however, to pay amounts
14 owed to a provider that has an ownership or other governing
15 interest in the managed health care entity. This subsection
16 applies only to managed health care entities and the services
17 they provide under the integrated health care program under
18 this Section.
19 (o) Notwithstanding any other provision of law or
20 contractual agreement to the contrary, providers shall not be
21 required to accept from any other third party payer the rates
22 determined or paid under this Code by the Illinois
23 Department, managed health care entity, or other health care
24 delivery system for services provided to recipients.
25 (p) The Illinois Department may seek and obtain any
26 necessary authorization provided under federal law to
27 implement the program, including the waiver of any federal
28 statutes or regulations. The Illinois Department may seek a
29 waiver of the federal requirement that the combined
30 membership of Medicare and Medicaid enrollees in a managed
31 care community network may not exceed 75% of the managed care
32 community network's total enrollment. The Illinois
33 Department shall not seek a waiver of this requirement for
34 any other category of managed health care entity. The
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1 Illinois Department shall not seek a waiver of the inpatient
2 hospital reimbursement methodology in Section 1902(a)(13)(A)
3 of Title XIX of the Social Security Act even if the federal
4 agency responsible for administering Title XIX determines
5 that Section 1902(a)(13)(A) applies to managed health care
6 systems.
7 Notwithstanding any other provisions of this Code to the
8 contrary, the Illinois Department shall seek a waiver of
9 applicable federal law in order to impose a co-payment system
10 consistent with this subsection on recipients of medical
11 services under Title XIX of the Social Security Act who are
12 not enrolled in a managed health care entity. The waiver
13 request submitted by the Illinois Department shall provide
14 for co-payments of up to $0.50 for prescribed drugs and up to
15 $0.50 for x-ray services and shall provide for co-payments of
16 up to $10 for non-emergency services provided in a hospital
17 emergency room and up to $10 for non-emergency ambulance
18 services. The purpose of the co-payments shall be to deter
19 those recipients from seeking unnecessary medical care.
20 Co-payments may not be used to deter recipients from seeking
21 necessary medical care. No recipient shall be required to
22 pay more than a total of $150 per year in co-payments under
23 the waiver request required by this subsection. A recipient
24 may not be required to pay more than $15 of any amount due
25 under this subsection in any one month.
26 Co-payments authorized under this subsection may not be
27 imposed when the care was necessitated by a true medical
28 emergency. Co-payments may not be imposed for any of the
29 following classifications of services:
30 (1) Services furnished to person under 18 years of
31 age.
32 (2) Services furnished to pregnant women.
33 (3) Services furnished to any individual who is an
34 inpatient in a hospital, nursing facility, intermediate
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1 care facility, or other medical institution, if that
2 person is required to spend for costs of medical care all
3 but a minimal amount of his or her income required for
4 personal needs.
5 (4) Services furnished to a person who is receiving
6 hospice care.
7 Co-payments authorized under this subsection shall not be
8 deducted from or reduce in any way payments for medical
9 services from the Illinois Department to providers. No
10 provider may deny those services to an individual eligible
11 for services based on the individual's inability to pay the
12 co-payment.
13 Recipients who are subject to co-payments shall be
14 provided notice, in plain and clear language, of the amount
15 of the co-payments, the circumstances under which co-payments
16 are exempted, the circumstances under which co-payments may
17 be assessed, and their manner of collection.
18 The Illinois Department shall establish a Medicaid
19 Co-Payment Council to assist in the development of co-payment
20 policies for the medical assistance program. The Medicaid
21 Co-Payment Council shall also have jurisdiction to develop a
22 program to provide financial or non-financial incentives to
23 Medicaid recipients in order to encourage recipients to seek
24 necessary health care. The Council shall be chaired by the
25 Director of the Illinois Department, and shall have 6
26 additional members. Two of the 6 additional members shall be
27 appointed by the Governor, and one each shall be appointed by
28 the President of the Senate, the Minority Leader of the
29 Senate, the Speaker of the House of Representatives, and the
30 Minority Leader of the House of Representatives. The Council
31 may be convened and make recommendations upon the appointment
32 of a majority of its members. The Council shall be appointed
33 and convened no later than September 1, 1994 and shall report
34 its recommendations to the Director of the Illinois
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1 Department and the General Assembly no later than October 1,
2 1994. The chairperson of the Council shall be allowed to
3 vote only in the case of a tie vote among the appointed
4 members of the Council.
5 The Council shall be guided by the following principles
6 as it considers recommendations to be developed to implement
7 any approved waivers that the Illinois Department must seek
8 pursuant to this subsection:
9 (1) Co-payments should not be used to deter access
10 to adequate medical care.
11 (2) Co-payments should be used to reduce fraud.
12 (3) Co-payment policies should be examined in
13 consideration of other states' experience, and the
14 ability of successful co-payment plans to control
15 unnecessary or inappropriate utilization of services
16 should be promoted.
17 (4) All participants, both recipients and
18 providers, in the medical assistance program have
19 responsibilities to both the State and the program.
20 (5) Co-payments are primarily a tool to educate the
21 participants in the responsible use of health care
22 resources.
23 (6) Co-payments should not be used to penalize
24 providers.
25 (7) A successful medical program requires the
26 elimination of improper utilization of medical resources.
27 The integrated health care program, or any part of that
28 program, established under this Section may not be
29 implemented if matching federal funds under Title XIX of the
30 Social Security Act are not available for administering the
31 program.
32 The Illinois Department shall submit for publication in
33 the Illinois Register the name, address, and telephone number
34 of the individual to whom a request may be directed for a
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1 copy of the request for a waiver of provisions of Title XIX
2 of the Social Security Act that the Illinois Department
3 intends to submit to the Health Care Financing Administration
4 in order to implement this Section. The Illinois Department
5 shall mail a copy of that request for waiver to all
6 requestors at least 16 days before filing that request for
7 waiver with the Health Care Financing Administration.
8 (q) After the effective date of this Section, the
9 Illinois Department may take all planning and preparatory
10 action necessary to implement this Section, including, but
11 not limited to, seeking requests for proposals relating to
12 the integrated health care program created under this
13 Section.
14 (r) In order to (i) accelerate and facilitate the
15 development of integrated health care in contracting areas
16 outside counties with populations in excess of 3,000,000 and
17 counties adjacent to those counties and (ii) maintain and
18 sustain the high quality of education and residency programs
19 coordinated and associated with local area hospitals, the
20 Illinois Department may develop and implement a demonstration
21 program for managed care community networks owned, operated,
22 or governed by State-funded medical schools. The Illinois
23 Department shall prescribe by rule the criteria, standards,
24 and procedures for effecting this demonstration program.
25 (s) (Blank).
26 (t) On April 1, 1995 and every 6 months thereafter, the
27 Illinois Department shall report to the Governor and General
28 Assembly on the progress of the integrated health care
29 program in enrolling clients into managed health care
30 entities. The report shall indicate the capacities of the
31 managed health care entities with which the State contracts,
32 the number of clients enrolled by each contractor, the areas
33 of the State in which managed care options do not exist, and
34 the progress toward meeting the enrollment goals of the
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1 integrated health care program.
2 (u) The Illinois Department may implement this Section
3 through the use of emergency rules in accordance with Section
4 5-45 of the Illinois Administrative Procedure Act. For
5 purposes of that Act, the adoption of rules to implement this
6 Section is deemed an emergency and necessary for the public
7 interest, safety, and welfare.
8 (Source: P.A. 88-554, eff. 7-26-94; 89-21, eff. 7-1-95;
9 89-673, eff. 8-14-96; revised 8-26-96.)
10 (Text of Section after amendment by P.A. 89-507)
11 Sec. 5-16.3. System for integrated health care services.
12 (a) It shall be the public policy of the State to adopt,
13 to the extent practicable, a health care program that
14 encourages the integration of health care services and
15 manages the health care of program enrollees while preserving
16 reasonable choice within a competitive and cost-efficient
17 environment. In furtherance of this public policy, the
18 Illinois Department shall develop and implement an integrated
19 health care program consistent with the provisions of this
20 Section. The provisions of this Section apply only to the
21 integrated health care program created under this Section.
22 Persons enrolled in the integrated health care program, as
23 determined by the Illinois Department by rule, shall be
24 afforded a choice among health care delivery systems, which
25 shall include, but are not limited to, (i) fee for service
26 care managed by a primary care physician licensed to practice
27 medicine in all its branches, (ii) managed health care
28 entities, and (iii) federally qualified health centers
29 (reimbursed according to a prospective cost-reimbursement
30 methodology) and rural health clinics (reimbursed according
31 to the Medicare methodology), where available. Persons
32 enrolled in the integrated health care program also may be
33 offered indemnity insurance plans, subject to availability.
34 For purposes of this Section, a "managed health care
-24- LRB9000964DJcd
1 entity" means a health maintenance organization or a managed
2 care community network as defined in this Section. A "health
3 maintenance organization" means a health maintenance
4 organization as defined in the Health Maintenance
5 Organization Act. A "managed care community network" means
6 an entity, other than a health maintenance organization, that
7 is owned, operated, or governed by providers of health care
8 services within this State and that provides or arranges
9 primary, secondary, and tertiary managed health care services
10 under contract with the Illinois Department exclusively to
11 enrollees of the integrated health care program. A managed
12 care community network may contract with the Illinois
13 Department to provide only pediatric health care services. A
14 county provider as defined in Section 15-1 of this Code may
15 contract with the Illinois Department to provide services to
16 enrollees of the integrated health care program as a managed
17 care community network without the need to establish a
18 separate entity that provides services exclusively to
19 enrollees of the integrated health care program and shall be
20 deemed a managed care community network for purposes of this
21 Code only to the extent of the provision of services to those
22 enrollees in conjunction with the integrated health care
23 program. A county provider shall be entitled to contract
24 with the Illinois Department with respect to any contracting
25 region located in whole or in part within the county. A
26 county provider shall not be required to accept enrollees who
27 do not reside within the county.
28 Each managed care community network must demonstrate its
29 ability to bear the financial risk of serving enrollees under
30 this program. The Illinois Department shall by rule adopt
31 criteria for assessing the financial soundness of each
32 managed care community network. These rules shall consider
33 the extent to which a managed care community network is
34 comprised of providers who directly render health care and
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1 are located within the community in which they seek to
2 contract rather than solely arrange or finance the delivery
3 of health care. These rules shall further consider a variety
4 of risk-bearing and management techniques, including the
5 sufficiency of quality assurance and utilization management
6 programs and whether a managed care community network has
7 sufficiently demonstrated its financial solvency and net
8 worth. The Illinois Department's criteria must be based on
9 sound actuarial, financial, and accounting principles. In
10 adopting these rules, the Illinois Department shall consult
11 with the Illinois Department of Insurance. The Illinois
12 Department is responsible for monitoring compliance with
13 these rules.
14 This Section may not be implemented before the effective
15 date of these rules, the approval of any necessary federal
16 waivers, and the completion of the review of an application
17 submitted, at least 60 days before the effective date of
18 rules adopted under this Section, to the Illinois Department
19 by a managed care community network.
20 All health care delivery systems that contract with the
21 Illinois Department under the integrated health care program
22 shall clearly recognize a health care provider's right of
23 conscience under the Right of Conscience Act. In addition to
24 the provisions of that Act, no health care delivery system
25 that contracts with the Illinois Department under the
26 integrated health care program shall be required to provide,
27 arrange for, or pay for any health care or medical service,
28 procedure, or product if that health care delivery system is
29 owned, controlled, or sponsored by or affiliated with a
30 religious institution or religious organization that finds
31 that health care or medical service, procedure, or product to
32 violate its religious and moral teachings and beliefs.
33 (b) The Illinois Department may, by rule, provide for
34 different benefit packages for different categories of
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1 persons enrolled in the program. Mental health services,
2 alcohol and substance abuse services, services related to
3 children with chronic or acute conditions requiring
4 longer-term treatment and follow-up, and rehabilitation care
5 provided by a free-standing rehabilitation hospital or a
6 hospital rehabilitation unit may be excluded from a benefit
7 package if the State ensures that those services are made
8 available through a separate delivery system. An exclusion
9 does not prohibit the Illinois Department from developing and
10 implementing demonstration projects for categories of persons
11 or services. Benefit packages for persons eligible for
12 medical assistance under Articles V, VI, and XII shall be
13 based on the requirements of those Articles and shall be
14 consistent with the Title XIX of the Social Security Act.
15 Nothing in this Act shall be construed to apply to services
16 purchased by the Department of Children and Family Services
17 and the Department of Human Services (as successor to the
18 Department of Mental Health and Developmental Disabilities)
19 under the provisions of Title 59 of the Illinois
20 Administrative Code, Part 132 ("Medicaid Community Mental
21 Health Services Program").
22 (c) The program established by this Section may be
23 implemented by the Illinois Department in various contracting
24 areas at various times. The health care delivery systems and
25 providers available under the program may vary throughout the
26 State. For purposes of contracting with managed health care
27 entities and providers, the Illinois Department shall
28 establish contracting areas similar to the geographic areas
29 designated by the Illinois Department for contracting
30 purposes under the Illinois Competitive Access and
31 Reimbursement Equity Program (ICARE) under the authority of
32 Section 3-4 of the Illinois Health Finance Reform Act or
33 similarly-sized or smaller geographic areas established by
34 the Illinois Department by rule. A managed health care entity
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1 shall be permitted to contract in any geographic areas for
2 which it has a sufficient provider network and otherwise
3 meets the contracting terms of the State. The Illinois
4 Department is not prohibited from entering into a contract
5 with a managed health care entity at any time.
6 (c-5) A managed health care entity may not engage in
7 door-to-door marketing activities or marketing activities at
8 an office of the Illinois Department or a county department
9 in order to enroll in the entity's health care delivery
10 system persons who are enrolled in the integrated health care
11 program established under this Section.
12 Before a managed health care entity may market its health
13 care delivery system to persons enrolled in the integrated
14 health care program established under this Section, the
15 Illinois Department must approve a marketing plan submitted
16 by the entity to the Illinois Department. The Illinois
17 Department shall adopt guidelines for approving marketing
18 plans submitted by managed health care entities under this
19 subsection. Besides prohibiting door-to-door marketing
20 activities and marketing activities at public aid offices,
21 the guidelines shall include at least the following:
22 (1) A managed health care entity may not offer or
23 provide any gift, favor, or other inducement in marketing
24 its health care delivery system to integrated health care
25 program enrollees.
26 (2) All persons employed or otherwise engaged by a
27 managed health care entity to market the entity's health
28 care delivery system to integrated health care program
29 enrollees or to supervise that marketing shall register
30 with the Illinois Department.
31 The Inspector General appointed under Section 12-13.1 may
32 conduct investigations to determine whether the marketing
33 practices of managed health care entities participating in
34 the integrated health care program comply with the
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1 guidelines.
2 (d) A managed health care entity that contracts with the
3 Illinois Department for the provision of services under the
4 program shall do all of the following, solely for purposes of
5 the integrated health care program:
6 (1) Provide that any individual physician licensed
7 to practice medicine in all its branches, any pharmacy,
8 any federally qualified health center, and any
9 podiatrist, that consistently meets the reasonable terms
10 and conditions established by the managed health care
11 entity, including but not limited to credentialing
12 standards, quality assurance program requirements,
13 utilization management requirements, financial
14 responsibility standards, contracting process
15 requirements, and provider network size and accessibility
16 requirements, must be accepted by the managed health care
17 entity for purposes of the Illinois integrated health
18 care program. Any individual who is either terminated
19 from or denied inclusion in the panel of physicians of
20 the managed health care entity shall be given, within 10
21 business days after that determination, a written
22 explanation of the reasons for his or her exclusion or
23 termination from the panel. This paragraph (1) does not
24 apply to the following:
25 (A) A managed health care entity that
26 certifies to the Illinois Department that:
27 (i) it employs on a full-time basis 125
28 or more Illinois physicians licensed to
29 practice medicine in all of its branches; and
30 (ii) it will provide medical services
31 through its employees to more than 80% of the
32 recipients enrolled with the entity in the
33 integrated health care program; or
34 (B) A domestic stock insurance company
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1 licensed under clause (b) of class 1 of Section 4 of
2 the Illinois Insurance Code if (i) at least 66% of
3 the stock of the insurance company is owned by a
4 professional corporation organized under the
5 Professional Service Corporation Act that has 125 or
6 more shareholders who are Illinois physicians
7 licensed to practice medicine in all of its branches
8 and (ii) the insurance company certifies to the
9 Illinois Department that at least 80% of those
10 physician shareholders will provide services to
11 recipients enrolled with the company in the
12 integrated health care program.
13 (2) Provide for reimbursement for providers for
14 emergency care, as defined by the Illinois Department by
15 rule, that must be provided to its enrollees, including
16 an emergency room screening fee, and urgent care that it
17 authorizes for its enrollees, regardless of the
18 provider's affiliation with the managed health care
19 entity. Providers shall be reimbursed for emergency care
20 at an amount equal to the Illinois Department's
21 fee-for-service rates for those medical services rendered
22 by providers not under contract with the managed health
23 care entity to enrollees of the entity.
24 (3) Provide that any provider affiliated with a
25 managed health care entity may also provide services on a
26 fee-for-service basis to Illinois Department clients not
27 enrolled in a managed health care entity.
28 (4) Provide client education services as determined
29 and approved by the Illinois Department, including but
30 not limited to (i) education regarding appropriate
31 utilization of health care services in a managed care
32 system, (ii) written disclosure of treatment policies and
33 any restrictions or limitations on health services,
34 including, but not limited to, physical services,
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1 clinical laboratory tests, hospital and surgical
2 procedures, prescription drugs and biologics, and
3 radiological examinations, and (iii) written notice that
4 the enrollee may receive from another provider those
5 services covered under this program that are not provided
6 by the managed health care entity.
7 (5) Provide that enrollees within its system may
8 choose the site for provision of services and the panel
9 of health care providers.
10 (6) Not discriminate in its enrollment or
11 disenrollment practices among recipients of medical
12 services or program enrollees based on health status.
13 (7) Provide a quality assurance and utilization
14 review program that (i) for health maintenance
15 organizations meets the requirements of the Health
16 Maintenance Organization Act and (ii) for managed care
17 community networks meets the requirements established by
18 the Illinois Department in rules that incorporate those
19 standards set forth in the Health Maintenance
20 Organization Act.
21 (8) Issue a managed health care entity
22 identification card to each enrollee upon enrollment.
23 The card must contain all of the following:
24 (A) The enrollee's signature.
25 (B) The enrollee's health plan.
26 (C) The name and telephone number of the
27 enrollee's primary care physician.
28 (D) A telephone number to be used for
29 emergency service 24 hours per day, 7 days per week.
30 The telephone number required to be maintained
31 pursuant to this subparagraph by each managed health
32 care entity shall, at minimum, be staffed by
33 medically trained personnel and be provided
34 directly, or under arrangement, at an office or
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1 offices in locations maintained solely within the
2 State of Illinois. For purposes of this
3 subparagraph, "medically trained personnel" means
4 licensed practical nurses or registered nurses
5 located in the State of Illinois who are licensed
6 pursuant to the Illinois Nursing Act of 1987.
7 (9) Ensure that every primary care physician and
8 pharmacy in the managed health care entity meets the
9 standards established by the Illinois Department for
10 accessibility and quality of care. The Illinois
11 Department shall arrange for and oversee an evaluation of
12 the standards established under this paragraph (9) and
13 may recommend any necessary changes to these standards.
14 The Illinois Department shall submit an annual report to
15 the Governor and the General Assembly by April 1 of each
16 year regarding the effect of the standards on ensuring
17 access and quality of care to enrollees.
18 (10) Provide a procedure for handling complaints
19 that (i) for health maintenance organizations meets the
20 requirements of the Health Maintenance Organization Act
21 and (ii) for managed care community networks meets the
22 requirements established by the Illinois Department in
23 rules that incorporate those standards set forth in the
24 Health Maintenance Organization Act.
25 (11) Maintain, retain, and make available to the
26 Illinois Department records, data, and information, in a
27 uniform manner determined by the Illinois Department,
28 sufficient for the Illinois Department to monitor
29 utilization, accessibility, and quality of care.
30 (12) Except for providers who are prepaid, pay all
31 approved claims for covered services that are completed
32 and submitted to the managed health care entity within 30
33 days after receipt of the claim or receipt of the
34 appropriate capitation payment or payments by the managed
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1 health care entity from the State for the month in which
2 the services included on the claim were rendered,
3 whichever is later. If payment is not made or mailed to
4 the provider by the managed health care entity by the due
5 date under this subsection, an interest penalty of 1% of
6 any amount unpaid shall be added for each month or
7 fraction of a month after the due date, until final
8 payment is made. Nothing in this Section shall prohibit
9 managed health care entities and providers from mutually
10 agreeing to terms that require more timely payment.
11 (13) Provide integration with community-based
12 programs provided by certified local health departments
13 such as Women, Infants, and Children Supplemental Food
14 Program (WIC), childhood immunization programs, health
15 education programs, case management programs, and health
16 screening programs.
17 (14) Provide that the pharmacy formulary used by a
18 managed health care entity and its contract providers be
19 no more restrictive than the Illinois Department's
20 pharmaceutical program on the effective date of this
21 amendatory Act of 1994 and as amended after that date.
22 (15) Provide integration with community-based
23 organizations, including, but not limited to, any
24 organization that has operated within a Medicaid
25 Partnership as defined by this Code or by rule of the
26 Illinois Department, that may continue to operate under a
27 contract with the Illinois Department or a managed health
28 care entity under this Section to provide case management
29 services to Medicaid clients in designated high-need
30 areas.
31 The Illinois Department may, by rule, determine
32 methodologies to limit financial liability for managed health
33 care entities resulting from payment for services to
34 enrollees provided under the Illinois Department's integrated
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1 health care program. Any methodology so determined may be
2 considered or implemented by the Illinois Department through
3 a contract with a managed health care entity under this
4 integrated health care program.
5 The Illinois Department shall contract with an entity or
6 entities to provide external peer-based quality assurance
7 review for the integrated health care program. The entity
8 shall be representative of Illinois physicians licensed to
9 practice medicine in all its branches and have statewide
10 geographic representation in all specialties of medical care
11 that are provided within the integrated health care program.
12 The entity may not be a third party payer and shall maintain
13 offices in locations around the State in order to provide
14 service and continuing medical education to physician
15 participants within the integrated health care program. The
16 review process shall be developed and conducted by Illinois
17 physicians licensed to practice medicine in all its branches.
18 In consultation with the entity, the Illinois Department may
19 contract with other entities for professional peer-based
20 quality assurance review of individual categories of services
21 other than services provided, supervised, or coordinated by
22 physicians licensed to practice medicine in all its branches.
23 The Illinois Department shall establish, by rule, criteria to
24 avoid conflicts of interest in the conduct of quality
25 assurance activities consistent with professional peer-review
26 standards. All quality assurance activities shall be
27 coordinated by the Illinois Department.
28 (e) All persons enrolled in the program shall be
29 provided with a full written explanation of all
30 fee-for-service and managed health care plan options and a
31 reasonable opportunity to choose among the options as
32 provided by rule. The Illinois Department shall provide to
33 enrollees, upon enrollment in the integrated health care
34 program and at least annually thereafter, notice of the
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1 process for requesting an appeal under the Illinois
2 Department's administrative appeal procedures.
3 Notwithstanding any other Section of this Code, the Illinois
4 Department may provide by rule for the Illinois Department to
5 assign a person enrolled in the program to a specific
6 provider of medical services or to a specific health care
7 delivery system if an enrollee has failed to exercise choice
8 in a timely manner. An enrollee assigned by the Illinois
9 Department shall be afforded the opportunity to disenroll and
10 to select a specific provider of medical services or a
11 specific health care delivery system within the first 30 days
12 after the assignment. An enrollee who has failed to exercise
13 choice in a timely manner may be assigned only if there are 3
14 or more managed health care entities contracting with the
15 Illinois Department within the contracting area, except that,
16 outside the City of Chicago, this requirement may be waived
17 for an area by rules adopted by the Illinois Department after
18 consultation with all hospitals within the contracting area.
19 The Illinois Department shall establish by rule the procedure
20 for random assignment of enrollees who fail to exercise
21 choice in a timely manner to a specific managed health care
22 entity in proportion to the available capacity of that
23 managed health care entity. Assignment to a specific provider
24 of medical services or to a specific managed health care
25 entity may not exceed that provider's or entity's capacity as
26 determined by the Illinois Department. Any person who has
27 chosen a specific provider of medical services or a specific
28 managed health care entity, or any person who has been
29 assigned under this subsection, shall be given the
30 opportunity to change that choice or assignment at least once
31 every 12 months, as determined by the Illinois Department by
32 rule. The Illinois Department shall maintain a toll-free
33 telephone number for program enrollees' use in reporting
34 problems with managed health care entities.
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1 (f) If a person becomes eligible for participation in
2 the integrated health care program while he or she is
3 hospitalized, the Illinois Department may not enroll that
4 person in the program until after he or she has been
5 discharged from the hospital. This subsection does not apply
6 to newborn infants whose mothers are enrolled in the
7 integrated health care program.
8 (g) The Illinois Department shall, by rule, establish
9 for managed health care entities rates that (i) are certified
10 to be actuarially sound, as determined by an actuary who is
11 an associate or a fellow of the Society of Actuaries or a
12 member of the American Academy of Actuaries and who has
13 expertise and experience in medical insurance and benefit
14 programs, in accordance with the Illinois Department's
15 current fee-for-service payment system, and (ii) take into
16 account any difference of cost to provide health care to
17 different populations based on gender, age, location, and
18 eligibility category. The rates for managed health care
19 entities shall be determined on a capitated basis.
20 The Illinois Department by rule shall establish a method
21 to adjust its payments to managed health care entities in a
22 manner intended to avoid providing any financial incentive to
23 a managed health care entity to refer patients to a county
24 provider, in an Illinois county having a population greater
25 than 3,000,000, that is paid directly by the Illinois
26 Department. The Illinois Department shall by April 1, 1997,
27 and annually thereafter, review the method to adjust
28 payments. Payments by the Illinois Department to the county
29 provider, for persons not enrolled in a managed care
30 community network owned or operated by a county provider,
31 shall be paid on a fee-for-service basis under Article XV of
32 this Code.
33 The Illinois Department by rule shall establish a method
34 to reduce its payments to managed health care entities to
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1 take into consideration (i) any adjustment payments paid to
2 hospitals under subsection (h) of this Section to the extent
3 those payments, or any part of those payments, have been
4 taken into account in establishing capitated rates under this
5 subsection (g) and (ii) the implementation of methodologies
6 to limit financial liability for managed health care entities
7 under subsection (d) of this Section.
8 (h) For hospital services provided by a hospital that
9 contracts with a managed health care entity, adjustment
10 payments shall be paid directly to the hospital by the
11 Illinois Department. Adjustment payments may include but
12 need not be limited to adjustment payments to:
13 disproportionate share hospitals under Section 5-5.02 of this
14 Code; primary care access health care education payments (89
15 Ill. Adm. Code 149.140); payments for capital, direct medical
16 education, indirect medical education, certified registered
17 nurse anesthetist, and kidney acquisition costs (89 Ill. Adm.
18 Code 149.150(c)); uncompensated care payments (89 Ill. Adm.
19 Code 148.150(h)); trauma center payments (89 Ill. Adm. Code
20 148.290(c)); rehabilitation hospital payments (89 Ill. Adm.
21 Code 148.290(d)); perinatal center payments (89 Ill. Adm.
22 Code 148.290(e)); obstetrical care payments (89 Ill. Adm.
23 Code 148.290(f)); targeted access payments (89 Ill. Adm. Code
24 148.290(g)); Medicaid high volume payments (89 Ill. Adm. Code
25 148.290(h)); and outpatient indigent volume adjustments (89
26 Ill. Adm. Code 148.140(b)(5)).
27 (i) For any hospital eligible for the adjustment
28 payments described in subsection (h), the Illinois Department
29 shall maintain, through the period ending June 30, 1995,
30 reimbursement levels in accordance with statutes and rules in
31 effect on April 1, 1994.
32 (j) Nothing contained in this Code in any way limits or
33 otherwise impairs the authority or power of the Illinois
34 Department to enter into a negotiated contract pursuant to
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1 this Section with a managed health care entity, including,
2 but not limited to, a health maintenance organization, that
3 provides for termination or nonrenewal of the contract
4 without cause upon notice as provided in the contract and
5 without a hearing.
6 (k) Section 5-5.15 does not apply to the program
7 developed and implemented pursuant to this Section.
8 (l) The Illinois Department shall, by rule, define those
9 chronic or acute medical conditions of childhood that require
10 longer-term treatment and follow-up care. The Illinois
11 Department shall ensure that services required to treat these
12 conditions are available through a separate delivery system.
13 A managed health care entity that contracts with the
14 Illinois Department may refer a child with medical conditions
15 described in the rules adopted under this subsection directly
16 to a children's hospital or to a hospital, other than a
17 children's hospital, that is qualified to provide inpatient
18 and outpatient services to treat those conditions. The
19 Illinois Department shall provide fee-for-service
20 reimbursement directly to a children's hospital for those
21 services pursuant to Title 89 of the Illinois Administrative
22 Code, Section 148.280(a), at a rate at least equal to the
23 rate in effect on March 31, 1994. For hospitals, other than
24 children's hospitals, that are qualified to provide inpatient
25 and outpatient services to treat those conditions, the
26 Illinois Department shall provide reimbursement for those
27 services on a fee-for-service basis, at a rate at least equal
28 to the rate in effect for those other hospitals on March 31,
29 1994.
30 A children's hospital shall be directly reimbursed for
31 all services provided at the children's hospital on a
32 fee-for-service basis pursuant to Title 89 of the Illinois
33 Administrative Code, Section 148.280(a), at a rate at least
34 equal to the rate in effect on March 31, 1994, until the
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1 later of (i) implementation of the integrated health care
2 program under this Section and development of actuarially
3 sound capitation rates for services other than those chronic
4 or acute medical conditions of childhood that require
5 longer-term treatment and follow-up care as defined by the
6 Illinois Department in the rules adopted under this
7 subsection or (ii) March 31, 1996.
8 Notwithstanding anything in this subsection to the
9 contrary, a managed health care entity shall not consider
10 sources or methods of payment in determining the referral of
11 a child. The Illinois Department shall adopt rules to
12 establish criteria for those referrals. The Illinois
13 Department by rule shall establish a method to adjust its
14 payments to managed health care entities in a manner intended
15 to avoid providing any financial incentive to a managed
16 health care entity to refer patients to a provider who is
17 paid directly by the Illinois Department.
18 (m) Behavioral health services provided or funded by the
19 Department of Human Services, the Department of Children and
20 Family Services, and the Illinois Department shall be
21 excluded from a benefit package. Conditions of an organic or
22 physical origin or nature, including medical detoxification,
23 however, may not be excluded. In this subsection,
24 "behavioral health services" means mental health services and
25 subacute alcohol and substance abuse treatment services, as
26 defined in the Illinois Alcoholism and Other Drug Dependency
27 Act. In this subsection, "mental health services" includes,
28 at a minimum, the following services funded by the Illinois
29 Department, the Department of Human Services (as successor to
30 the Department of Mental Health and Developmental
31 Disabilities), or the Department of Children and Family
32 Services: (i) inpatient hospital services, including related
33 physician services, related psychiatric interventions, and
34 pharmaceutical services provided to an eligible recipient
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1 hospitalized with a primary diagnosis of psychiatric
2 disorder; (ii) outpatient mental health services as defined
3 and specified in Title 59 of the Illinois Administrative
4 Code, Part 132; (iii) any other outpatient mental health
5 services funded by the Illinois Department pursuant to the
6 State of Illinois Medicaid Plan; (iv) partial
7 hospitalization; and (v) follow-up stabilization related to
8 any of those services. Additional behavioral health services
9 may be excluded under this subsection as mutually agreed in
10 writing by the Illinois Department and the affected State
11 agency or agencies. The exclusion of any service does not
12 prohibit the Illinois Department from developing and
13 implementing demonstration projects for categories of persons
14 or services. The Department of Children and Family Services
15 and the Department of Human Services shall each adopt rules
16 governing the integration of managed care in the provision of
17 behavioral health services. The State shall integrate managed
18 care community networks and affiliated providers, to the
19 extent practicable, in any separate delivery system for
20 mental health services.
21 (n) The Illinois Department shall adopt rules to
22 establish reserve requirements for managed care community
23 networks, as required by subsection (a), and health
24 maintenance organizations to protect against liabilities in
25 the event that a managed health care entity is declared
26 insolvent or bankrupt. If a managed health care entity other
27 than a county provider is declared insolvent or bankrupt,
28 after liquidation and application of any available assets,
29 resources, and reserves, the Illinois Department shall pay a
30 portion of the amounts owed by the managed health care entity
31 to providers for services rendered to enrollees under the
32 integrated health care program under this Section based on
33 the following schedule: (i) from April 1, 1995 through June
34 30, 1998, 90% of the amounts owed; (ii) from July 1, 1998
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1 through June 30, 2001, 80% of the amounts owed; and (iii)
2 from July 1, 2001 through June 30, 2005, 75% of the amounts
3 owed. The amounts paid under this subsection shall be
4 calculated based on the total amount owed by the managed
5 health care entity to providers before application of any
6 available assets, resources, and reserves. After June 30,
7 2005, the Illinois Department may not pay any amounts owed to
8 providers as a result of an insolvency or bankruptcy of a
9 managed health care entity occurring after that date. The
10 Illinois Department is not obligated, however, to pay amounts
11 owed to a provider that has an ownership or other governing
12 interest in the managed health care entity. This subsection
13 applies only to managed health care entities and the services
14 they provide under the integrated health care program under
15 this Section.
16 (o) Notwithstanding any other provision of law or
17 contractual agreement to the contrary, providers shall not be
18 required to accept from any other third party payer the rates
19 determined or paid under this Code by the Illinois
20 Department, managed health care entity, or other health care
21 delivery system for services provided to recipients.
22 (p) The Illinois Department may seek and obtain any
23 necessary authorization provided under federal law to
24 implement the program, including the waiver of any federal
25 statutes or regulations. The Illinois Department may seek a
26 waiver of the federal requirement that the combined
27 membership of Medicare and Medicaid enrollees in a managed
28 care community network may not exceed 75% of the managed care
29 community network's total enrollment. The Illinois
30 Department shall not seek a waiver of this requirement for
31 any other category of managed health care entity. The
32 Illinois Department shall not seek a waiver of the inpatient
33 hospital reimbursement methodology in Section 1902(a)(13)(A)
34 of Title XIX of the Social Security Act even if the federal
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1 agency responsible for administering Title XIX determines
2 that Section 1902(a)(13)(A) applies to managed health care
3 systems.
4 Notwithstanding any other provisions of this Code to the
5 contrary, the Illinois Department shall seek a waiver of
6 applicable federal law in order to impose a co-payment system
7 consistent with this subsection on recipients of medical
8 services under Title XIX of the Social Security Act who are
9 not enrolled in a managed health care entity. The waiver
10 request submitted by the Illinois Department shall provide
11 for co-payments of up to $0.50 for prescribed drugs and up to
12 $0.50 for x-ray services and shall provide for co-payments of
13 up to $10 for non-emergency services provided in a hospital
14 emergency room and up to $10 for non-emergency ambulance
15 services. The purpose of the co-payments shall be to deter
16 those recipients from seeking unnecessary medical care.
17 Co-payments may not be used to deter recipients from seeking
18 necessary medical care. No recipient shall be required to
19 pay more than a total of $150 per year in co-payments under
20 the waiver request required by this subsection. A recipient
21 may not be required to pay more than $15 of any amount due
22 under this subsection in any one month.
23 Co-payments authorized under this subsection may not be
24 imposed when the care was necessitated by a true medical
25 emergency. Co-payments may not be imposed for any of the
26 following classifications of services:
27 (1) Services furnished to person under 18 years of
28 age.
29 (2) Services furnished to pregnant women.
30 (3) Services furnished to any individual who is an
31 inpatient in a hospital, nursing facility, intermediate
32 care facility, or other medical institution, if that
33 person is required to spend for costs of medical care all
34 but a minimal amount of his or her income required for
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1 personal needs.
2 (4) Services furnished to a person who is receiving
3 hospice care.
4 Co-payments authorized under this subsection shall not be
5 deducted from or reduce in any way payments for medical
6 services from the Illinois Department to providers. No
7 provider may deny those services to an individual eligible
8 for services based on the individual's inability to pay the
9 co-payment.
10 Recipients who are subject to co-payments shall be
11 provided notice, in plain and clear language, of the amount
12 of the co-payments, the circumstances under which co-payments
13 are exempted, the circumstances under which co-payments may
14 be assessed, and their manner of collection.
15 The Illinois Department shall establish a Medicaid
16 Co-Payment Council to assist in the development of co-payment
17 policies for the medical assistance program. The Medicaid
18 Co-Payment Council shall also have jurisdiction to develop a
19 program to provide financial or non-financial incentives to
20 Medicaid recipients in order to encourage recipients to seek
21 necessary health care. The Council shall be chaired by the
22 Director of the Illinois Department, and shall have 6
23 additional members. Two of the 6 additional members shall be
24 appointed by the Governor, and one each shall be appointed by
25 the President of the Senate, the Minority Leader of the
26 Senate, the Speaker of the House of Representatives, and the
27 Minority Leader of the House of Representatives. The Council
28 may be convened and make recommendations upon the appointment
29 of a majority of its members. The Council shall be appointed
30 and convened no later than September 1, 1994 and shall report
31 its recommendations to the Director of the Illinois
32 Department and the General Assembly no later than October 1,
33 1994. The chairperson of the Council shall be allowed to
34 vote only in the case of a tie vote among the appointed
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1 members of the Council.
2 The Council shall be guided by the following principles
3 as it considers recommendations to be developed to implement
4 any approved waivers that the Illinois Department must seek
5 pursuant to this subsection:
6 (1) Co-payments should not be used to deter access
7 to adequate medical care.
8 (2) Co-payments should be used to reduce fraud.
9 (3) Co-payment policies should be examined in
10 consideration of other states' experience, and the
11 ability of successful co-payment plans to control
12 unnecessary or inappropriate utilization of services
13 should be promoted.
14 (4) All participants, both recipients and
15 providers, in the medical assistance program have
16 responsibilities to both the State and the program.
17 (5) Co-payments are primarily a tool to educate the
18 participants in the responsible use of health care
19 resources.
20 (6) Co-payments should not be used to penalize
21 providers.
22 (7) A successful medical program requires the
23 elimination of improper utilization of medical resources.
24 The integrated health care program, or any part of that
25 program, established under this Section may not be
26 implemented if matching federal funds under Title XIX of the
27 Social Security Act are not available for administering the
28 program.
29 The Illinois Department shall submit for publication in
30 the Illinois Register the name, address, and telephone number
31 of the individual to whom a request may be directed for a
32 copy of the request for a waiver of provisions of Title XIX
33 of the Social Security Act that the Illinois Department
34 intends to submit to the Health Care Financing Administration
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1 in order to implement this Section. The Illinois Department
2 shall mail a copy of that request for waiver to all
3 requestors at least 16 days before filing that request for
4 waiver with the Health Care Financing Administration.
5 (q) After the effective date of this Section, the
6 Illinois Department may take all planning and preparatory
7 action necessary to implement this Section, including, but
8 not limited to, seeking requests for proposals relating to
9 the integrated health care program created under this
10 Section.
11 (r) In order to (i) accelerate and facilitate the
12 development of integrated health care in contracting areas
13 outside counties with populations in excess of 3,000,000 and
14 counties adjacent to those counties and (ii) maintain and
15 sustain the high quality of education and residency programs
16 coordinated and associated with local area hospitals, the
17 Illinois Department may develop and implement a demonstration
18 program for managed care community networks owned, operated,
19 or governed by State-funded medical schools. The Illinois
20 Department shall prescribe by rule the criteria, standards,
21 and procedures for effecting this demonstration program.
22 (s) (Blank).
23 (t) On April 1, 1995 and every 6 months thereafter, the
24 Illinois Department shall report to the Governor and General
25 Assembly on the progress of the integrated health care
26 program in enrolling clients into managed health care
27 entities. The report shall indicate the capacities of the
28 managed health care entities with which the State contracts,
29 the number of clients enrolled by each contractor, the areas
30 of the State in which managed care options do not exist, and
31 the progress toward meeting the enrollment goals of the
32 integrated health care program.
33 (u) The Illinois Department may implement this Section
34 through the use of emergency rules in accordance with Section
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1 5-45 of the Illinois Administrative Procedure Act. For
2 purposes of that Act, the adoption of rules to implement this
3 Section is deemed an emergency and necessary for the public
4 interest, safety, and welfare.
5 (Source: P.A. 88-554, eff. 7-26-94; 89-21, eff. 7-1-95;
6 89-507, eff. 7-1-97; 89-673, eff. 8-14-96; revised 8-26-96.)
7 Section 95. No acceleration or delay. Where this Act
8 makes changes in a statute that is represented in this Act by
9 text that is not yet or no longer in effect (for example, a
10 Section represented by multiple versions), the use of that
11 text does not accelerate or delay the taking effect of (i)
12 the changes made by this Act or (ii) provisions derived from
13 any other Public Act.
14 Section 99. Effective date. This Act takes effect upon
15 becoming law.