[ Search ] [ Legislation ] [ Bill Summary ]
[ Home ] [ Back ] [ Bottom ]
| [ Introduced ] | [ House Amendment 001 ] |
90_HB0776eng
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
HB0776 Engrossed LRB9000964DJcd
1 AN ACT to amend the Illinois Public Aid Code by changing
2 Section 5-16.3 and adding Section 5-16.10.
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 and adding Section 5-16.10 as
7 follows:
8 (305 ILCS 5/5-16.3)
9 (Text of Section before amendment by P.A. 89-507)
10 Sec. 5-16.3. System for integrated health care services.
11 (a) It shall be the public policy of the State to adopt,
12 to the extent practicable, a health care program that
13 encourages the integration of health care services and
14 manages the health care of program enrollees while preserving
15 reasonable choice within a competitive and cost-efficient
16 environment. In furtherance of this public policy, the
17 Illinois Department shall develop and implement an integrated
18 health care program consistent with the provisions of this
19 Section. The provisions of this Section apply only to the
20 integrated health care program created under this Section.
21 Persons enrolled in the integrated health care program, as
22 determined by the Illinois Department by rule, shall be
23 afforded a choice among health care delivery systems, which
24 shall include, but are not limited to, (i) fee for service
25 care managed by a primary care physician licensed to practice
26 medicine in all its branches, (ii) managed health care
27 entities, and (iii) federally qualified health centers
28 (reimbursed according to a prospective cost-reimbursement
29 methodology) and rural health clinics (reimbursed according
30 to the Medicare methodology), where available. Persons
31 enrolled in the integrated health care program also may be
HB0776 Engrossed -2- LRB9000964DJcd
1 offered indemnity insurance plans, subject to availability.
2 For purposes of this Section, a "managed health care
3 entity" means a health maintenance organization or a managed
4 care community network as defined in this Section. A "health
5 maintenance organization" means a health maintenance
6 organization as defined in the Health Maintenance
7 Organization Act. A "managed care community network" means
8 an entity, other than a health maintenance organization, that
9 is owned, operated, or governed by providers of health care
10 services within this State and that provides or arranges
11 primary, secondary, and tertiary managed health care services
12 under contract with the Illinois Department exclusively to
13 enrollees of the integrated health care program. A managed
14 care community network may contract with the Illinois
15 Department to provide only pediatric health care services. A
16 county provider as defined in Section 15-1 of this Code may
17 contract with the Illinois Department to provide services to
18 enrollees of the integrated health care program as a managed
19 care community network without the need to establish a
20 separate entity that provides services exclusively to
21 enrollees of the integrated health care program and shall be
22 deemed a managed care community network for purposes of this
23 Code only to the extent of the provision of services to those
24 enrollees in conjunction with the integrated health care
25 program. A county provider shall be entitled to contract
26 with the Illinois Department with respect to any contracting
27 region located in whole or in part within the county. A
28 county provider shall not be required to accept enrollees who
29 do not reside within the county.
30 Each managed care community network must demonstrate its
31 ability to bear the financial risk of serving enrollees under
32 this program. The Illinois Department shall by rule adopt
33 criteria for assessing the financial soundness of each
34 managed care community network. These rules shall consider
HB0776 Engrossed -3- LRB9000964DJcd
1 the extent to which a managed care community network is
2 comprised of providers who directly render health care and
3 are located within the community in which they seek to
4 contract rather than solely arrange or finance the delivery
5 of health care. These rules shall further consider a variety
6 of risk-bearing and management techniques, including the
7 sufficiency of quality assurance and utilization management
8 programs and whether a managed care community network has
9 sufficiently demonstrated its financial solvency and net
10 worth. The Illinois Department's criteria must be based on
11 sound actuarial, financial, and accounting principles. In
12 adopting these rules, the Illinois Department shall consult
13 with the Illinois Department of Insurance. The Illinois
14 Department is responsible for monitoring compliance with
15 these rules.
16 This Section may not be implemented before the effective
17 date of these rules, the approval of any necessary federal
18 waivers, and the completion of the review of an application
19 submitted, at least 60 days before the effective date of
20 rules adopted under this Section, to the Illinois Department
21 by a managed care community network.
22 All health care delivery systems that contract with the
23 Illinois Department under the integrated health care program
24 shall clearly recognize a health care provider's right of
25 conscience under the Right of Conscience Act. In addition to
26 the provisions of that Act, no health care delivery system
27 that contracts with the Illinois Department under the
28 integrated health care program shall be required to provide,
29 arrange for, or pay for any health care or medical service,
30 procedure, or product if that health care delivery system is
31 owned, controlled, or sponsored by or affiliated with a
32 religious institution or religious organization that finds
33 that health care or medical service, procedure, or product to
34 violate its religious and moral teachings and beliefs.
HB0776 Engrossed -4- LRB9000964DJcd
1 (b) The Illinois Department may, by rule, provide for
2 different benefit packages for different categories of
3 persons enrolled in the program. Mental health services,
4 alcohol and substance abuse services, services related to
5 children with chronic or acute conditions requiring
6 longer-term treatment and follow-up, and rehabilitation care
7 provided by a free-standing rehabilitation hospital or a
8 hospital rehabilitation unit may be excluded from a benefit
9 package if the State ensures that those services are made
10 available through a separate delivery system. An exclusion
11 does not prohibit the Illinois Department from developing and
12 implementing demonstration projects for categories of persons
13 or services. Benefit packages for persons eligible for
14 medical assistance under Articles V, VI, and XII shall be
15 based on the requirements of those Articles and shall be
16 consistent with the Title XIX of the Social Security Act.
17 Nothing in this Act shall be construed to apply to services
18 purchased by the Department of Children and Family Services
19 and the Department of Mental Health and Developmental
20 Disabilities under the provisions of Title 59 of the Illinois
21 Administrative Code, Part 132 ("Medicaid Community Mental
22 Health Services Program").
23 (c) The program established by this Section may be
24 implemented by the Illinois Department in various contracting
25 areas at various times. The health care delivery systems and
26 providers available under the program may vary throughout the
27 State. For purposes of contracting with managed health care
28 entities and providers, the Illinois Department shall
29 establish contracting areas similar to the geographic areas
30 designated by the Illinois Department for contracting
31 purposes under the Illinois Competitive Access and
32 Reimbursement Equity Program (ICARE) under the authority of
33 Section 3-4 of the Illinois Health Finance Reform Act or
34 similarly-sized or smaller geographic areas established by
HB0776 Engrossed -5- LRB9000964DJcd
1 the Illinois Department by rule. A managed health care entity
2 shall be permitted to contract in any geographic areas for
3 which it has a sufficient provider network and otherwise
4 meets the contracting terms of the State. The Illinois
5 Department is not prohibited from entering into a contract
6 with a managed health care entity at any time.
7 (c-5) A managed health care entity may not engage in
8 door-to-door marketing activities or marketing activities at
9 an office of the Illinois Department or a county department
10 in order to enroll in the entity's health care delivery
11 system persons who are enrolled in the integrated health care
12 program established under this Section. The Illinois
13 Department shall adopt rules defining "marketing activities"
14 prohibited by this subsection (c-5).
15 Before a managed health care entity may market its health
16 care delivery system to persons enrolled in the integrated
17 health care program established under this Section, the
18 Illinois Department must approve a marketing plan submitted
19 by the entity to the Illinois Department. The Illinois
20 Department shall adopt guidelines for approving marketing
21 plans submitted by managed health care entities under this
22 subsection. Besides prohibiting door-to-door marketing
23 activities and marketing activities at public aid offices,
24 the guidelines shall include at least the following:
25 (1) A managed health care entity may not offer or
26 provide any gift, favor, or other inducement in marketing
27 its health care delivery system to integrated health care
28 program enrollees. A managed health care entity may
29 provide health care related items that are of nominal
30 value and pre-approved by the Illinois Department to
31 prospective enrollees. A managed health care entity may
32 also provide to enrollees health care related items that
33 have been pre-approved by the Illinois Department as an
34 incentive to manage their health care appropriately.
HB0776 Engrossed -6- LRB9000964DJcd
1 (2) All persons employed or otherwise engaged by a
2 managed health care entity to market the entity's health
3 care delivery system to integrated health care program
4 enrollees or to supervise that marketing shall register
5 with the Illinois Department.
6 The Inspector General appointed under Section 12-13.1 may
7 conduct investigations to determine whether the marketing
8 practices of managed health care entities participating in
9 the integrated health care program comply with the
10 guidelines.
11 (d) A managed health care entity that contracts with the
12 Illinois Department for the provision of services under the
13 program shall do all of the following, solely for purposes of
14 the integrated health care program:
15 (1) Provide that any individual physician licensed
16 to practice medicine in all its branches, any pharmacy,
17 any federally qualified health center, and any
18 podiatrist, that consistently meets the reasonable terms
19 and conditions established by the managed health care
20 entity, including but not limited to credentialing
21 standards, quality assurance program requirements,
22 utilization management requirements, financial
23 responsibility standards, contracting process
24 requirements, and provider network size and accessibility
25 requirements, must be accepted by the managed health care
26 entity for purposes of the Illinois integrated health
27 care program. Any individual who is either terminated
28 from or denied inclusion in the panel of physicians of
29 the managed health care entity shall be given, within 10
30 business days after that determination, a written
31 explanation of the reasons for his or her exclusion or
32 termination from the panel. This paragraph (1) does not
33 apply to the following:
34 (A) A managed health care entity that
HB0776 Engrossed -7- LRB9000964DJcd
1 certifies to the Illinois Department that:
2 (i) it employs on a full-time basis 125
3 or more Illinois physicians licensed to
4 practice medicine in all of its branches; and
5 (ii) it will provide medical services
6 through its employees to more than 80% of the
7 recipients enrolled with the entity in the
8 integrated health care program; or
9 (B) A domestic stock insurance company
10 licensed under clause (b) of class 1 of Section 4 of
11 the Illinois Insurance Code if (i) at least 66% of
12 the stock of the insurance company is owned by a
13 professional corporation organized under the
14 Professional Service Corporation Act that has 125 or
15 more shareholders who are Illinois physicians
16 licensed to practice medicine in all of its branches
17 and (ii) the insurance company certifies to the
18 Illinois Department that at least 80% of those
19 physician shareholders will provide services to
20 recipients enrolled with the company in the
21 integrated health care program.
22 (2) Provide for reimbursement for providers for
23 emergency care, as defined by the Illinois Department by
24 rule, that must be provided to its enrollees, including
25 an emergency room screening fee, and urgent care that it
26 authorizes for its enrollees, regardless of the
27 provider's affiliation with the managed health care
28 entity. Providers shall be reimbursed for emergency care
29 at an amount equal to the Illinois Department's
30 fee-for-service rates for those medical services rendered
31 by providers not under contract with the managed health
32 care entity to enrollees of the entity.
33 (3) Provide that any provider affiliated with a
34 managed health care entity may also provide services on a
HB0776 Engrossed -8- LRB9000964DJcd
1 fee-for-service basis to Illinois Department clients not
2 enrolled in a managed health care entity.
3 (4) Provide client education services as determined
4 and approved by the Illinois Department, including but
5 not limited to (i) education regarding appropriate
6 utilization of health care services in a managed care
7 system, (ii) written disclosure of treatment policies and
8 any restrictions or limitations on health services,
9 including, but not limited to, physical services,
10 clinical laboratory tests, hospital and surgical
11 procedures, prescription drugs and biologics, and
12 radiological examinations, and (iii) written notice that
13 the enrollee may receive from another provider those
14 services covered under this program that are not provided
15 by the managed health care entity.
16 (5) Provide that enrollees within its system may
17 choose the site for provision of services and the panel
18 of health care providers.
19 (6) Not discriminate in its enrollment or
20 disenrollment practices among recipients of medical
21 services or program enrollees based on health status.
22 (7) Provide a quality assurance and utilization
23 review program that (i) for health maintenance
24 organizations meets the requirements of the Health
25 Maintenance Organization Act and (ii) for managed care
26 community networks meets the requirements established by
27 the Illinois Department in rules that incorporate those
28 standards set forth in the Health Maintenance
29 Organization Act.
30 (8) Issue a managed health care entity
31 identification card to each enrollee upon enrollment.
32 The card must contain all of the following:
33 (A) The enrollee's signature.
34 (B) The enrollee's health plan.
HB0776 Engrossed -9- LRB9000964DJcd
1 (C) The name and telephone number of the
2 enrollee's primary care physician.
3 (D) A telephone number to be used for
4 emergency service 24 hours per day, 7 days per week.
5 The telephone number required to be maintained
6 pursuant to this subparagraph by each managed health
7 care entity shall, at minimum, be staffed by
8 medically trained personnel and be provided
9 directly, or under arrangement, at an office or
10 offices in locations maintained solely within the
11 State of Illinois. For purposes of this
12 subparagraph, "medically trained personnel" means
13 licensed practical nurses or registered nurses
14 located in the State of Illinois who are licensed
15 pursuant to the Illinois Nursing Act of 1987.
16 (9) Ensure that every primary care physician and
17 pharmacy in the managed health care entity meets the
18 standards established by the Illinois Department for
19 accessibility and quality of care. The Illinois
20 Department shall arrange for and oversee an evaluation of
21 the standards established under this paragraph (9) and
22 may recommend any necessary changes to these standards.
23 The Illinois Department shall submit an annual report to
24 the Governor and the General Assembly by April 1 of each
25 year regarding the effect of the standards on ensuring
26 access and quality of care to enrollees.
27 (10) Provide a procedure for handling complaints
28 that (i) for health maintenance organizations meets the
29 requirements of the Health Maintenance Organization Act
30 and (ii) for managed care community networks meets the
31 requirements established by the Illinois Department in
32 rules that incorporate those standards set forth in the
33 Health Maintenance Organization Act.
34 (11) Maintain, retain, and make available to the
HB0776 Engrossed -10- LRB9000964DJcd
1 Illinois Department records, data, and information, in a
2 uniform manner determined by the Illinois Department,
3 sufficient for the Illinois Department to monitor
4 utilization, accessibility, and quality of care.
5 (12) Except for providers who are prepaid, pay all
6 approved claims for covered services that are completed
7 and submitted to the managed health care entity within 30
8 days after receipt of the claim or receipt of the
9 appropriate capitation payment or payments by the managed
10 health care entity from the State for the month in which
11 the services included on the claim were rendered,
12 whichever is later. If payment is not made or mailed to
13 the provider by the managed health care entity by the due
14 date under this subsection, an interest penalty of 1% of
15 any amount unpaid shall be added for each month or
16 fraction of a month after the due date, until final
17 payment is made. Nothing in this Section shall prohibit
18 managed health care entities and providers from mutually
19 agreeing to terms that require more timely payment.
20 (13) Provide integration with community-based
21 programs provided by certified local health departments
22 such as Women, Infants, and Children Supplemental Food
23 Program (WIC), childhood immunization programs, health
24 education programs, case management programs, and health
25 screening programs.
26 (14) Provide that the pharmacy formulary used by a
27 managed health care entity and its contract providers be
28 no more restrictive than the Illinois Department's
29 pharmaceutical program on the effective date of this
30 amendatory Act of 1994 and as amended after that date.
31 (15) Provide integration with community-based
32 organizations, including, but not limited to, any
33 organization that has operated within a Medicaid
34 Partnership as defined by this Code or by rule of the
HB0776 Engrossed -11- LRB9000964DJcd
1 Illinois Department, that may continue to operate under a
2 contract with the Illinois Department or a managed health
3 care entity under this Section to provide case management
4 services to Medicaid clients in designated high-need
5 areas.
6 The Illinois Department may, by rule, determine
7 methodologies to limit financial liability for managed health
8 care entities resulting from payment for services to
9 enrollees provided under the Illinois Department's integrated
10 health care program. Any methodology so determined may be
11 considered or implemented by the Illinois Department through
12 a contract with a managed health care entity under this
13 integrated health care program.
14 The Illinois Department shall contract with an entity or
15 entities to provide external peer-based quality assurance
16 review for the integrated health care program. The entity
17 shall be representative of Illinois physicians licensed to
18 practice medicine in all its branches and have statewide
19 geographic representation in all specialties of medical care
20 that are provided within the integrated health care program.
21 The entity may not be a third party payer and shall maintain
22 offices in locations around the State in order to provide
23 service and continuing medical education to physician
24 participants within the integrated health care program. The
25 review process shall be developed and conducted by Illinois
26 physicians licensed to practice medicine in all its branches.
27 In consultation with the entity, the Illinois Department may
28 contract with other entities for professional peer-based
29 quality assurance review of individual categories of services
30 other than services provided, supervised, or coordinated by
31 physicians licensed to practice medicine in all its branches.
32 The Illinois Department shall establish, by rule, criteria to
33 avoid conflicts of interest in the conduct of quality
34 assurance activities consistent with professional peer-review
HB0776 Engrossed -12- LRB9000964DJcd
1 standards. All quality assurance activities shall be
2 coordinated by the Illinois Department.
3 (e) All persons enrolled in the program shall be
4 provided with a full written explanation of all
5 fee-for-service and managed health care plan options and a
6 reasonable opportunity to choose among the options as
7 provided by rule. The Illinois Department shall provide to
8 enrollees, upon enrollment in the integrated health care
9 program and at least annually thereafter, notice of the
10 process for requesting an appeal under the Illinois
11 Department's administrative appeal procedures.
12 Notwithstanding any other Section of this Code, the Illinois
13 Department may provide by rule for the Illinois Department to
14 assign a person enrolled in the program to a specific
15 provider of medical services or to a specific health care
16 delivery system if an enrollee has failed to exercise choice
17 in a timely manner. An enrollee assigned by the Illinois
18 Department shall be afforded the opportunity to disenroll and
19 to select a specific provider of medical services or a
20 specific health care delivery system within the first 30 days
21 after the assignment. An enrollee who has failed to exercise
22 choice in a timely manner may be assigned only if there are 3
23 or more managed health care entities contracting with the
24 Illinois Department within the contracting area, except that,
25 outside the City of Chicago, this requirement may be waived
26 for an area by rules adopted by the Illinois Department after
27 consultation with all hospitals within the contracting area.
28 The Illinois Department shall establish by rule the procedure
29 for random assignment of enrollees who fail to exercise
30 choice in a timely manner to a specific managed health care
31 entity in proportion to the available capacity of that
32 managed health care entity. Assignment to a specific provider
33 of medical services or to a specific managed health care
34 entity may not exceed that provider's or entity's capacity as
HB0776 Engrossed -13- LRB9000964DJcd
1 determined by the Illinois Department. Any person who has
2 chosen a specific provider of medical services or a specific
3 managed health care entity, or any person who has been
4 assigned under this subsection, shall be given the
5 opportunity to change that choice or assignment at least once
6 every 12 months, as determined by the Illinois Department by
7 rule. The Illinois Department shall maintain a toll-free
8 telephone number for program enrollees' use in reporting
9 problems with managed health care entities.
10 (f) If a person becomes eligible for participation in
11 the integrated health care program while he or she is
12 hospitalized, the Illinois Department may not enroll that
13 person in the program until after he or she has been
14 discharged from the hospital. This subsection does not apply
15 to newborn infants whose mothers are enrolled in the
16 integrated health care program.
17 (g) The Illinois Department shall, by rule, establish
18 for managed health care entities rates that (i) are certified
19 to be actuarially sound, as determined by an actuary who is
20 an associate or a fellow of the Society of Actuaries or a
21 member of the American Academy of Actuaries and who has
22 expertise and experience in medical insurance and benefit
23 programs, in accordance with the Illinois Department's
24 current fee-for-service payment system, and (ii) take into
25 account any difference of cost to provide health care to
26 different populations based on gender, age, location, and
27 eligibility category. The rates for managed health care
28 entities shall be determined on a capitated basis.
29 The Illinois Department by rule shall establish a method
30 to adjust its payments to managed health care entities in a
31 manner intended to avoid providing any financial incentive to
32 a managed health care entity to refer patients to a county
33 provider, in an Illinois county having a population greater
34 than 3,000,000, that is paid directly by the Illinois
HB0776 Engrossed -14- LRB9000964DJcd
1 Department. The Illinois Department shall by April 1, 1997,
2 and annually thereafter, review the method to adjust
3 payments. Payments by the Illinois Department to the county
4 provider, for persons not enrolled in a managed care
5 community network owned or operated by a county provider,
6 shall be paid on a fee-for-service basis under Article XV of
7 this Code.
8 The Illinois Department by rule shall establish a method
9 to reduce its payments to managed health care entities to
10 take into consideration (i) any adjustment payments paid to
11 hospitals under subsection (h) of this Section to the extent
12 those payments, or any part of those payments, have been
13 taken into account in establishing capitated rates under this
14 subsection (g) and (ii) the implementation of methodologies
15 to limit financial liability for managed health care entities
16 under subsection (d) of this Section.
17 (h) For hospital services provided by a hospital that
18 contracts with a managed health care entity, adjustment
19 payments shall be paid directly to the hospital by the
20 Illinois Department. Adjustment payments may include but
21 need not be limited to adjustment payments to:
22 disproportionate share hospitals under Section 5-5.02 of this
23 Code; primary care access health care education payments (89
24 Ill. Adm. Code 149.140); payments for capital, direct medical
25 education, indirect medical education, certified registered
26 nurse anesthetist, and kidney acquisition costs (89 Ill. Adm.
27 Code 149.150(c)); uncompensated care payments (89 Ill. Adm.
28 Code 148.150(h)); trauma center payments (89 Ill. Adm. Code
29 148.290(c)); rehabilitation hospital payments (89 Ill. Adm.
30 Code 148.290(d)); perinatal center payments (89 Ill. Adm.
31 Code 148.290(e)); obstetrical care payments (89 Ill. Adm.
32 Code 148.290(f)); targeted access payments (89 Ill. Adm. Code
33 148.290(g)); Medicaid high volume payments (89 Ill. Adm. Code
34 148.290(h)); and outpatient indigent volume adjustments (89
HB0776 Engrossed -15- LRB9000964DJcd
1 Ill. Adm. Code 148.140(b)(5)).
2 (i) For any hospital eligible for the adjustment
3 payments described in subsection (h), the Illinois Department
4 shall maintain, through the period ending June 30, 1995,
5 reimbursement levels in accordance with statutes and rules in
6 effect on April 1, 1994.
7 (j) Nothing contained in this Code in any way limits or
8 otherwise impairs the authority or power of the Illinois
9 Department to enter into a negotiated contract pursuant to
10 this Section with a managed health care entity, including,
11 but not limited to, a health maintenance organization, that
12 provides for termination or nonrenewal of the contract
13 without cause upon notice as provided in the contract and
14 without a hearing.
15 (k) Section 5-5.15 does not apply to the program
16 developed and implemented pursuant to this Section.
17 (l) The Illinois Department shall, by rule, define those
18 chronic or acute medical conditions of childhood that require
19 longer-term treatment and follow-up care. The Illinois
20 Department shall ensure that services required to treat these
21 conditions are available through a separate delivery system.
22 A managed health care entity that contracts with the
23 Illinois Department may refer a child with medical conditions
24 described in the rules adopted under this subsection directly
25 to a children's hospital or to a hospital, other than a
26 children's hospital, that is qualified to provide inpatient
27 and outpatient services to treat those conditions. The
28 Illinois Department shall provide fee-for-service
29 reimbursement directly to a children's hospital for those
30 services pursuant to Title 89 of the Illinois Administrative
31 Code, Section 148.280(a), at a rate at least equal to the
32 rate in effect on March 31, 1994. For hospitals, other than
33 children's hospitals, that are qualified to provide inpatient
34 and outpatient services to treat those conditions, the
HB0776 Engrossed -16- LRB9000964DJcd
1 Illinois Department shall provide reimbursement for those
2 services on a fee-for-service basis, at a rate at least equal
3 to the rate in effect for those other hospitals on March 31,
4 1994.
5 A children's hospital shall be directly reimbursed for
6 all services provided at the children's hospital on a
7 fee-for-service basis pursuant to Title 89 of the Illinois
8 Administrative Code, Section 148.280(a), at a rate at least
9 equal to the rate in effect on March 31, 1994, until the
10 later of (i) implementation of the integrated health care
11 program under this Section and development of actuarially
12 sound capitation rates for services other than those chronic
13 or acute medical conditions of childhood that require
14 longer-term treatment and follow-up care as defined by the
15 Illinois Department in the rules adopted under this
16 subsection or (ii) March 31, 1996.
17 Notwithstanding anything in this subsection to the
18 contrary, a managed health care entity shall not consider
19 sources or methods of payment in determining the referral of
20 a child. The Illinois Department shall adopt rules to
21 establish criteria for those referrals. The Illinois
22 Department by rule shall establish a method to adjust its
23 payments to managed health care entities in a manner intended
24 to avoid providing any financial incentive to a managed
25 health care entity to refer patients to a provider who is
26 paid directly by the Illinois Department.
27 (m) Behavioral health services provided or funded by the
28 Department of Mental Health and Developmental Disabilities,
29 the Department of Alcoholism and Substance Abuse, the
30 Department of Children and Family Services, and the Illinois
31 Department shall be excluded from a benefit package.
32 Conditions of an organic or physical origin or nature,
33 including medical detoxification, however, may not be
34 excluded. In this subsection, "behavioral health services"
HB0776 Engrossed -17- LRB9000964DJcd
1 means mental health services and subacute alcohol and
2 substance abuse treatment services, as defined in the
3 Illinois Alcoholism and Other Drug Dependency Act. In this
4 subsection, "mental health services" includes, at a minimum,
5 the following services funded by the Illinois Department, the
6 Department of Mental Health and Developmental Disabilities,
7 or the Department of Children and Family Services: (i)
8 inpatient hospital services, including related physician
9 services, related psychiatric interventions, and
10 pharmaceutical services provided to an eligible recipient
11 hospitalized with a primary diagnosis of psychiatric
12 disorder; (ii) outpatient mental health services as defined
13 and specified in Title 59 of the Illinois Administrative
14 Code, Part 132; (iii) any other outpatient mental health
15 services funded by the Illinois Department pursuant to the
16 State of Illinois Medicaid Plan; (iv) partial
17 hospitalization; and (v) follow-up stabilization related to
18 any of those services. Additional behavioral health services
19 may be excluded under this subsection as mutually agreed in
20 writing by the Illinois Department and the affected State
21 agency or agencies. The exclusion of any service does not
22 prohibit the Illinois Department from developing and
23 implementing demonstration projects for categories of persons
24 or services. The Department of Mental Health and
25 Developmental Disabilities, the Department of Children and
26 Family Services, and the Department of Alcoholism and
27 Substance Abuse shall each adopt rules governing the
28 integration of managed care in the provision of behavioral
29 health services. The State shall integrate managed care
30 community networks and affiliated providers, to the extent
31 practicable, in any separate delivery system for mental
32 health services.
33 (n) The Illinois Department shall adopt rules to
34 establish reserve requirements for managed care community
HB0776 Engrossed -18- LRB9000964DJcd
1 networks, as required by subsection (a), and health
2 maintenance organizations to protect against liabilities in
3 the event that a managed health care entity is declared
4 insolvent or bankrupt. If a managed health care entity other
5 than a county provider is declared insolvent or bankrupt,
6 after liquidation and application of any available assets,
7 resources, and reserves, the Illinois Department shall pay a
8 portion of the amounts owed by the managed health care entity
9 to providers for services rendered to enrollees under the
10 integrated health care program under this Section based on
11 the following schedule: (i) from April 1, 1995 through June
12 30, 1998, 90% of the amounts owed; (ii) from July 1, 1998
13 through June 30, 2001, 80% of the amounts owed; and (iii)
14 from July 1, 2001 through June 30, 2005, 75% of the amounts
15 owed. The amounts paid under this subsection shall be
16 calculated based on the total amount owed by the managed
17 health care entity to providers before application of any
18 available assets, resources, and reserves. After June 30,
19 2005, the Illinois Department may not pay any amounts owed to
20 providers as a result of an insolvency or bankruptcy of a
21 managed health care entity occurring after that date. The
22 Illinois Department is not obligated, however, to pay amounts
23 owed to a provider that has an ownership or other governing
24 interest in the managed health care entity. This subsection
25 applies only to managed health care entities and the services
26 they provide under the integrated health care program under
27 this Section.
28 (o) Notwithstanding any other provision of law or
29 contractual agreement to the contrary, providers shall not be
30 required to accept from any other third party payer the rates
31 determined or paid under this Code by the Illinois
32 Department, managed health care entity, or other health care
33 delivery system for services provided to recipients.
34 (p) The Illinois Department may seek and obtain any
HB0776 Engrossed -19- LRB9000964DJcd
1 necessary authorization provided under federal law to
2 implement the program, including the waiver of any federal
3 statutes or regulations. The Illinois Department may seek a
4 waiver of the federal requirement that the combined
5 membership of Medicare and Medicaid enrollees in a managed
6 care community network may not exceed 75% of the managed care
7 community network's total enrollment. The Illinois
8 Department shall not seek a waiver of this requirement for
9 any other category of managed health care entity. The
10 Illinois Department shall not seek a waiver of the inpatient
11 hospital reimbursement methodology in Section 1902(a)(13)(A)
12 of Title XIX of the Social Security Act even if the federal
13 agency responsible for administering Title XIX determines
14 that Section 1902(a)(13)(A) applies to managed health care
15 systems.
16 Notwithstanding any other provisions of this Code to the
17 contrary, the Illinois Department shall seek a waiver of
18 applicable federal law in order to impose a co-payment system
19 consistent with this subsection on recipients of medical
20 services under Title XIX of the Social Security Act who are
21 not enrolled in a managed health care entity. The waiver
22 request submitted by the Illinois Department shall provide
23 for co-payments of up to $0.50 for prescribed drugs and up to
24 $0.50 for x-ray services and shall provide for co-payments of
25 up to $10 for non-emergency services provided in a hospital
26 emergency room and up to $10 for non-emergency ambulance
27 services. The purpose of the co-payments shall be to deter
28 those recipients from seeking unnecessary medical care.
29 Co-payments may not be used to deter recipients from seeking
30 necessary medical care. No recipient shall be required to
31 pay more than a total of $150 per year in co-payments under
32 the waiver request required by this subsection. A recipient
33 may not be required to pay more than $15 of any amount due
34 under this subsection in any one month.
HB0776 Engrossed -20- LRB9000964DJcd
1 Co-payments authorized under this subsection may not be
2 imposed when the care was necessitated by a true medical
3 emergency. Co-payments may not be imposed for any of the
4 following classifications of services:
5 (1) Services furnished to person under 18 years of
6 age.
7 (2) Services furnished to pregnant women.
8 (3) Services furnished to any individual who is an
9 inpatient in a hospital, nursing facility, intermediate
10 care facility, or other medical institution, if that
11 person is required to spend for costs of medical care all
12 but a minimal amount of his or her income required for
13 personal needs.
14 (4) Services furnished to a person who is receiving
15 hospice care.
16 Co-payments authorized under this subsection shall not be
17 deducted from or reduce in any way payments for medical
18 services from the Illinois Department to providers. No
19 provider may deny those services to an individual eligible
20 for services based on the individual's inability to pay the
21 co-payment.
22 Recipients who are subject to co-payments shall be
23 provided notice, in plain and clear language, of the amount
24 of the co-payments, the circumstances under which co-payments
25 are exempted, the circumstances under which co-payments may
26 be assessed, and their manner of collection.
27 The Illinois Department shall establish a Medicaid
28 Co-Payment Council to assist in the development of co-payment
29 policies for the medical assistance program. The Medicaid
30 Co-Payment Council shall also have jurisdiction to develop a
31 program to provide financial or non-financial incentives to
32 Medicaid recipients in order to encourage recipients to seek
33 necessary health care. The Council shall be chaired by the
34 Director of the Illinois Department, and shall have 6
HB0776 Engrossed -21- LRB9000964DJcd
1 additional members. Two of the 6 additional members shall be
2 appointed by the Governor, and one each shall be appointed by
3 the President of the Senate, the Minority Leader of the
4 Senate, the Speaker of the House of Representatives, and the
5 Minority Leader of the House of Representatives. The Council
6 may be convened and make recommendations upon the appointment
7 of a majority of its members. The Council shall be appointed
8 and convened no later than September 1, 1994 and shall report
9 its recommendations to the Director of the Illinois
10 Department and the General Assembly no later than October 1,
11 1994. The chairperson of the Council shall be allowed to
12 vote only in the case of a tie vote among the appointed
13 members of the Council.
14 The Council shall be guided by the following principles
15 as it considers recommendations to be developed to implement
16 any approved waivers that the Illinois Department must seek
17 pursuant to this subsection:
18 (1) Co-payments should not be used to deter access
19 to adequate medical care.
20 (2) Co-payments should be used to reduce fraud.
21 (3) Co-payment policies should be examined in
22 consideration of other states' experience, and the
23 ability of successful co-payment plans to control
24 unnecessary or inappropriate utilization of services
25 should be promoted.
26 (4) All participants, both recipients and
27 providers, in the medical assistance program have
28 responsibilities to both the State and the program.
29 (5) Co-payments are primarily a tool to educate the
30 participants in the responsible use of health care
31 resources.
32 (6) Co-payments should not be used to penalize
33 providers.
34 (7) A successful medical program requires the
HB0776 Engrossed -22- LRB9000964DJcd
1 elimination of improper utilization of medical resources.
2 The integrated health care program, or any part of that
3 program, established under this Section may not be
4 implemented if matching federal funds under Title XIX of the
5 Social Security Act are not available for administering the
6 program.
7 The Illinois Department shall submit for publication in
8 the Illinois Register the name, address, and telephone number
9 of the individual to whom a request may be directed for a
10 copy of the request for a waiver of provisions of Title XIX
11 of the Social Security Act that the Illinois Department
12 intends to submit to the Health Care Financing Administration
13 in order to implement this Section. The Illinois Department
14 shall mail a copy of that request for waiver to all
15 requestors at least 16 days before filing that request for
16 waiver with the Health Care Financing Administration.
17 (q) After the effective date of this Section, the
18 Illinois Department may take all planning and preparatory
19 action necessary to implement this Section, including, but
20 not limited to, seeking requests for proposals relating to
21 the integrated health care program created under this
22 Section.
23 (r) In order to (i) accelerate and facilitate the
24 development of integrated health care in contracting areas
25 outside counties with populations in excess of 3,000,000 and
26 counties adjacent to those counties and (ii) maintain and
27 sustain the high quality of education and residency programs
28 coordinated and associated with local area hospitals, the
29 Illinois Department may develop and implement a demonstration
30 program for managed care community networks owned, operated,
31 or governed by State-funded medical schools. The Illinois
32 Department shall prescribe by rule the criteria, standards,
33 and procedures for effecting this demonstration program.
34 (s) (Blank).
HB0776 Engrossed -23- LRB9000964DJcd
1 (t) On April 1, 1995 and every 6 months thereafter, the
2 Illinois Department shall report to the Governor and General
3 Assembly on the progress of the integrated health care
4 program in enrolling clients into managed health care
5 entities. The report shall indicate the capacities of the
6 managed health care entities with which the State contracts,
7 the number of clients enrolled by each contractor, the areas
8 of the State in which managed care options do not exist, and
9 the progress toward meeting the enrollment goals of the
10 integrated health care program.
11 (u) The Illinois Department may implement this Section
12 through the use of emergency rules in accordance with Section
13 5-45 of the Illinois Administrative Procedure Act. For
14 purposes of that Act, the adoption of rules to implement this
15 Section is deemed an emergency and necessary for the public
16 interest, safety, and welfare.
17 (Source: P.A. 88-554, eff. 7-26-94; 89-21, eff. 7-1-95;
18 89-673, eff. 8-14-96; revised 8-26-96.)
19 (Text of Section after amendment by P.A. 89-507)
20 Sec. 5-16.3. System for integrated health care services.
21 (a) It shall be the public policy of the State to adopt,
22 to the extent practicable, a health care program that
23 encourages the integration of health care services and
24 manages the health care of program enrollees while preserving
25 reasonable choice within a competitive and cost-efficient
26 environment. In furtherance of this public policy, the
27 Illinois Department shall develop and implement an integrated
28 health care program consistent with the provisions of this
29 Section. The provisions of this Section apply only to the
30 integrated health care program created under this Section.
31 Persons enrolled in the integrated health care program, as
32 determined by the Illinois Department by rule, shall be
33 afforded a choice among health care delivery systems, which
34 shall include, but are not limited to, (i) fee for service
HB0776 Engrossed -24- LRB9000964DJcd
1 care managed by a primary care physician licensed to practice
2 medicine in all its branches, (ii) managed health care
3 entities, and (iii) federally qualified health centers
4 (reimbursed according to a prospective cost-reimbursement
5 methodology) and rural health clinics (reimbursed according
6 to the Medicare methodology), where available. Persons
7 enrolled in the integrated health care program also may be
8 offered indemnity insurance plans, subject to availability.
9 For purposes of this Section, a "managed health care
10 entity" means a health maintenance organization or a managed
11 care community network as defined in this Section. A "health
12 maintenance organization" means a health maintenance
13 organization as defined in the Health Maintenance
14 Organization Act. A "managed care community network" means
15 an entity, other than a health maintenance organization, that
16 is owned, operated, or governed by providers of health care
17 services within this State and that provides or arranges
18 primary, secondary, and tertiary managed health care services
19 under contract with the Illinois Department exclusively to
20 enrollees of the integrated health care program. A managed
21 care community network may contract with the Illinois
22 Department to provide only pediatric health care services. A
23 county provider as defined in Section 15-1 of this Code may
24 contract with the Illinois Department to provide services to
25 enrollees of the integrated health care program as a managed
26 care community network without the need to establish a
27 separate entity that provides services exclusively to
28 enrollees of the integrated health care program and shall be
29 deemed a managed care community network for purposes of this
30 Code only to the extent of the provision of services to those
31 enrollees in conjunction with the integrated health care
32 program. A county provider shall be entitled to contract
33 with the Illinois Department with respect to any contracting
34 region located in whole or in part within the county. A
HB0776 Engrossed -25- LRB9000964DJcd
1 county provider shall not be required to accept enrollees who
2 do not reside within the county.
3 Each managed care community network must demonstrate its
4 ability to bear the financial risk of serving enrollees under
5 this program. The Illinois Department shall by rule adopt
6 criteria for assessing the financial soundness of each
7 managed care community network. These rules shall consider
8 the extent to which a managed care community network is
9 comprised of providers who directly render health care and
10 are located within the community in which they seek to
11 contract rather than solely arrange or finance the delivery
12 of health care. These rules shall further consider a variety
13 of risk-bearing and management techniques, including the
14 sufficiency of quality assurance and utilization management
15 programs and whether a managed care community network has
16 sufficiently demonstrated its financial solvency and net
17 worth. The Illinois Department's criteria must be based on
18 sound actuarial, financial, and accounting principles. In
19 adopting these rules, the Illinois Department shall consult
20 with the Illinois Department of Insurance. The Illinois
21 Department is responsible for monitoring compliance with
22 these rules.
23 This Section may not be implemented before the effective
24 date of these rules, the approval of any necessary federal
25 waivers, and the completion of the review of an application
26 submitted, at least 60 days before the effective date of
27 rules adopted under this Section, to the Illinois Department
28 by a managed care community network.
29 All health care delivery systems that contract with the
30 Illinois Department under the integrated health care program
31 shall clearly recognize a health care provider's right of
32 conscience under the Right of Conscience Act. In addition to
33 the provisions of that Act, no health care delivery system
34 that contracts with the Illinois Department under the
HB0776 Engrossed -26- LRB9000964DJcd
1 integrated health care program shall be required to provide,
2 arrange for, or pay for any health care or medical service,
3 procedure, or product if that health care delivery system is
4 owned, controlled, or sponsored by or affiliated with a
5 religious institution or religious organization that finds
6 that health care or medical service, procedure, or product to
7 violate its religious and moral teachings and beliefs.
8 (b) The Illinois Department may, by rule, provide for
9 different benefit packages for different categories of
10 persons enrolled in the program. Mental health services,
11 alcohol and substance abuse services, services related to
12 children with chronic or acute conditions requiring
13 longer-term treatment and follow-up, and rehabilitation care
14 provided by a free-standing rehabilitation hospital or a
15 hospital rehabilitation unit may be excluded from a benefit
16 package if the State ensures that those services are made
17 available through a separate delivery system. An exclusion
18 does not prohibit the Illinois Department from developing and
19 implementing demonstration projects for categories of persons
20 or services. Benefit packages for persons eligible for
21 medical assistance under Articles V, VI, and XII shall be
22 based on the requirements of those Articles and shall be
23 consistent with the Title XIX of the Social Security Act.
24 Nothing in this Act shall be construed to apply to services
25 purchased by the Department of Children and Family Services
26 and the Department of Human Services (as successor to the
27 Department of Mental Health and Developmental Disabilities)
28 under the provisions of Title 59 of the Illinois
29 Administrative Code, Part 132 ("Medicaid Community Mental
30 Health Services Program").
31 (c) The program established by this Section may be
32 implemented by the Illinois Department in various contracting
33 areas at various times. The health care delivery systems and
34 providers available under the program may vary throughout the
HB0776 Engrossed -27- LRB9000964DJcd
1 State. For purposes of contracting with managed health care
2 entities and providers, the Illinois Department shall
3 establish contracting areas similar to the geographic areas
4 designated by the Illinois Department for contracting
5 purposes under the Illinois Competitive Access and
6 Reimbursement Equity Program (ICARE) under the authority of
7 Section 3-4 of the Illinois Health Finance Reform Act or
8 similarly-sized or smaller geographic areas established by
9 the Illinois Department by rule. A managed health care entity
10 shall be permitted to contract in any geographic areas for
11 which it has a sufficient provider network and otherwise
12 meets the contracting terms of the State. The Illinois
13 Department is not prohibited from entering into a contract
14 with a managed health care entity at any time.
15 (c-5) A managed health care entity may not engage in
16 door-to-door marketing activities or marketing activities at
17 an office of the Illinois Department or a county department
18 in order to enroll in the entity's health care delivery
19 system persons who are enrolled in the integrated health care
20 program established under this Section. The Illinois
21 Department shall adopt rules defining "marketing activities"
22 prohibited by this subsection (c-5).
23 Before a managed health care entity may market its health
24 care delivery system to persons enrolled in the integrated
25 health care program established under this Section, the
26 Illinois Department must approve a marketing plan submitted
27 by the entity to the Illinois Department. The Illinois
28 Department shall adopt guidelines for approving marketing
29 plans submitted by managed health care entities under this
30 subsection. Besides prohibiting door-to-door marketing
31 activities and marketing activities at public aid offices,
32 the guidelines shall include at least the following:
33 (1) A managed health care entity may not offer or
34 provide any gift, favor, or other inducement in marketing
HB0776 Engrossed -28- LRB9000964DJcd
1 its health care delivery system to integrated health care
2 program enrollees. A managed health care entity may
3 provide health care related items that are of nominal
4 value and pre-approved by the Illinois Department to
5 prospective enrollees. A managed health care entity may
6 also provide to enrollees health care related items that
7 have been pre-approved by the Illinois Department as an
8 incentive to manage their health care appropriately.
9 (2) All persons employed or otherwise engaged by a
10 managed health care entity to market the entity's health
11 care delivery system to integrated health care program
12 enrollees or to supervise that marketing shall register
13 with the Illinois Department.
14 The Inspector General appointed under Section 12-13.1 may
15 conduct investigations to determine whether the marketing
16 practices of managed health care entities participating in
17 the integrated health care program comply with the
18 guidelines.
19 (d) A managed health care entity that contracts with the
20 Illinois Department for the provision of services under the
21 program shall do all of the following, solely for purposes of
22 the integrated health care program:
23 (1) Provide that any individual physician licensed
24 to practice medicine in all its branches, any pharmacy,
25 any federally qualified health center, and any
26 podiatrist, that consistently meets the reasonable terms
27 and conditions established by the managed health care
28 entity, including but not limited to credentialing
29 standards, quality assurance program requirements,
30 utilization management requirements, financial
31 responsibility standards, contracting process
32 requirements, and provider network size and accessibility
33 requirements, must be accepted by the managed health care
34 entity for purposes of the Illinois integrated health
HB0776 Engrossed -29- LRB9000964DJcd
1 care program. Any individual who is either terminated
2 from or denied inclusion in the panel of physicians of
3 the managed health care entity shall be given, within 10
4 business days after that determination, a written
5 explanation of the reasons for his or her exclusion or
6 termination from the panel. This paragraph (1) does not
7 apply to the following:
8 (A) A managed health care entity that
9 certifies to the Illinois Department that:
10 (i) it employs on a full-time basis 125
11 or more Illinois physicians licensed to
12 practice medicine in all of its branches; and
13 (ii) it will provide medical services
14 through its employees to more than 80% of the
15 recipients enrolled with the entity in the
16 integrated health care program; or
17 (B) A domestic stock insurance company
18 licensed under clause (b) of class 1 of Section 4 of
19 the Illinois Insurance Code if (i) at least 66% of
20 the stock of the insurance company is owned by a
21 professional corporation organized under the
22 Professional Service Corporation Act that has 125 or
23 more shareholders who are Illinois physicians
24 licensed to practice medicine in all of its branches
25 and (ii) the insurance company certifies to the
26 Illinois Department that at least 80% of those
27 physician shareholders will provide services to
28 recipients enrolled with the company in the
29 integrated health care program.
30 (2) Provide for reimbursement for providers for
31 emergency care, as defined by the Illinois Department by
32 rule, that must be provided to its enrollees, including
33 an emergency room screening fee, and urgent care that it
34 authorizes for its enrollees, regardless of the
HB0776 Engrossed -30- LRB9000964DJcd
1 provider's affiliation with the managed health care
2 entity. Providers shall be reimbursed for emergency care
3 at an amount equal to the Illinois Department's
4 fee-for-service rates for those medical services rendered
5 by providers not under contract with the managed health
6 care entity to enrollees of the entity.
7 (3) Provide that any provider affiliated with a
8 managed health care entity may also provide services on a
9 fee-for-service basis to Illinois Department clients not
10 enrolled in a managed health care entity.
11 (4) Provide client education services as determined
12 and approved by the Illinois Department, including but
13 not limited to (i) education regarding appropriate
14 utilization of health care services in a managed care
15 system, (ii) written disclosure of treatment policies and
16 any restrictions or limitations on health services,
17 including, but not limited to, physical services,
18 clinical laboratory tests, hospital and surgical
19 procedures, prescription drugs and biologics, and
20 radiological examinations, and (iii) written notice that
21 the enrollee may receive from another provider those
22 services covered under this program that are not provided
23 by the managed health care entity.
24 (5) Provide that enrollees within its system may
25 choose the site for provision of services and the panel
26 of health care providers.
27 (6) Not discriminate in its enrollment or
28 disenrollment practices among recipients of medical
29 services or program enrollees based on health status.
30 (7) Provide a quality assurance and utilization
31 review program that (i) for health maintenance
32 organizations meets the requirements of the Health
33 Maintenance Organization Act and (ii) for managed care
34 community networks meets the requirements established by
HB0776 Engrossed -31- LRB9000964DJcd
1 the Illinois Department in rules that incorporate those
2 standards set forth in the Health Maintenance
3 Organization Act.
4 (8) Issue a managed health care entity
5 identification card to each enrollee upon enrollment.
6 The card must contain all of the following:
7 (A) The enrollee's signature.
8 (B) The enrollee's health plan.
9 (C) The name and telephone number of the
10 enrollee's primary care physician.
11 (D) A telephone number to be used for
12 emergency service 24 hours per day, 7 days per week.
13 The telephone number required to be maintained
14 pursuant to this subparagraph by each managed health
15 care entity shall, at minimum, be staffed by
16 medically trained personnel and be provided
17 directly, or under arrangement, at an office or
18 offices in locations maintained solely within the
19 State of Illinois. For purposes of this
20 subparagraph, "medically trained personnel" means
21 licensed practical nurses or registered nurses
22 located in the State of Illinois who are licensed
23 pursuant to the Illinois Nursing Act of 1987.
24 (9) Ensure that every primary care physician and
25 pharmacy in the managed health care entity meets the
26 standards established by the Illinois Department for
27 accessibility and quality of care. The Illinois
28 Department shall arrange for and oversee an evaluation of
29 the standards established under this paragraph (9) and
30 may recommend any necessary changes to these standards.
31 The Illinois Department shall submit an annual report to
32 the Governor and the General Assembly by April 1 of each
33 year regarding the effect of the standards on ensuring
34 access and quality of care to enrollees.
HB0776 Engrossed -32- LRB9000964DJcd
1 (10) Provide a procedure for handling complaints
2 that (i) for health maintenance organizations meets the
3 requirements of the Health Maintenance Organization Act
4 and (ii) for managed care community networks meets the
5 requirements established by the Illinois Department in
6 rules that incorporate those standards set forth in the
7 Health Maintenance Organization Act.
8 (11) Maintain, retain, and make available to the
9 Illinois Department records, data, and information, in a
10 uniform manner determined by the Illinois Department,
11 sufficient for the Illinois Department to monitor
12 utilization, accessibility, and quality of care.
13 (12) Except for providers who are prepaid, pay all
14 approved claims for covered services that are completed
15 and submitted to the managed health care entity within 30
16 days after receipt of the claim or receipt of the
17 appropriate capitation payment or payments by the managed
18 health care entity from the State for the month in which
19 the services included on the claim were rendered,
20 whichever is later. If payment is not made or mailed to
21 the provider by the managed health care entity by the due
22 date under this subsection, an interest penalty of 1% of
23 any amount unpaid shall be added for each month or
24 fraction of a month after the due date, until final
25 payment is made. Nothing in this Section shall prohibit
26 managed health care entities and providers from mutually
27 agreeing to terms that require more timely payment.
28 (13) Provide integration with community-based
29 programs provided by certified local health departments
30 such as Women, Infants, and Children Supplemental Food
31 Program (WIC), childhood immunization programs, health
32 education programs, case management programs, and health
33 screening programs.
34 (14) Provide that the pharmacy formulary used by a
HB0776 Engrossed -33- LRB9000964DJcd
1 managed health care entity and its contract providers be
2 no more restrictive than the Illinois Department's
3 pharmaceutical program on the effective date of this
4 amendatory Act of 1994 and as amended after that date.
5 (15) Provide integration with community-based
6 organizations, including, but not limited to, any
7 organization that has operated within a Medicaid
8 Partnership as defined by this Code or by rule of the
9 Illinois Department, that may continue to operate under a
10 contract with the Illinois Department or a managed health
11 care entity under this Section to provide case management
12 services to Medicaid clients in designated high-need
13 areas.
14 The Illinois Department may, by rule, determine
15 methodologies to limit financial liability for managed health
16 care entities resulting from payment for services to
17 enrollees provided under the Illinois Department's integrated
18 health care program. Any methodology so determined may be
19 considered or implemented by the Illinois Department through
20 a contract with a managed health care entity under this
21 integrated health care program.
22 The Illinois Department shall contract with an entity or
23 entities to provide external peer-based quality assurance
24 review for the integrated health care program. The entity
25 shall be representative of Illinois physicians licensed to
26 practice medicine in all its branches and have statewide
27 geographic representation in all specialties of medical care
28 that are provided within the integrated health care program.
29 The entity may not be a third party payer and shall maintain
30 offices in locations around the State in order to provide
31 service and continuing medical education to physician
32 participants within the integrated health care program. The
33 review process shall be developed and conducted by Illinois
34 physicians licensed to practice medicine in all its branches.
HB0776 Engrossed -34- LRB9000964DJcd
1 In consultation with the entity, the Illinois Department may
2 contract with other entities for professional peer-based
3 quality assurance review of individual categories of services
4 other than services provided, supervised, or coordinated by
5 physicians licensed to practice medicine in all its branches.
6 The Illinois Department shall establish, by rule, criteria to
7 avoid conflicts of interest in the conduct of quality
8 assurance activities consistent with professional peer-review
9 standards. All quality assurance activities shall be
10 coordinated by the Illinois Department.
11 (e) All persons enrolled in the program shall be
12 provided with a full written explanation of all
13 fee-for-service and managed health care plan options and a
14 reasonable opportunity to choose among the options as
15 provided by rule. The Illinois Department shall provide to
16 enrollees, upon enrollment in the integrated health care
17 program and at least annually thereafter, notice of the
18 process for requesting an appeal under the Illinois
19 Department's administrative appeal procedures.
20 Notwithstanding any other Section of this Code, the Illinois
21 Department may provide by rule for the Illinois Department to
22 assign a person enrolled in the program to a specific
23 provider of medical services or to a specific health care
24 delivery system if an enrollee has failed to exercise choice
25 in a timely manner. An enrollee assigned by the Illinois
26 Department shall be afforded the opportunity to disenroll and
27 to select a specific provider of medical services or a
28 specific health care delivery system within the first 30 days
29 after the assignment. An enrollee who has failed to exercise
30 choice in a timely manner may be assigned only if there are 3
31 or more managed health care entities contracting with the
32 Illinois Department within the contracting area, except that,
33 outside the City of Chicago, this requirement may be waived
34 for an area by rules adopted by the Illinois Department after
HB0776 Engrossed -35- LRB9000964DJcd
1 consultation with all hospitals within the contracting area.
2 The Illinois Department shall establish by rule the procedure
3 for random assignment of enrollees who fail to exercise
4 choice in a timely manner to a specific managed health care
5 entity in proportion to the available capacity of that
6 managed health care entity. Assignment to a specific provider
7 of medical services or to a specific managed health care
8 entity may not exceed that provider's or entity's capacity as
9 determined by the Illinois Department. Any person who has
10 chosen a specific provider of medical services or a specific
11 managed health care entity, or any person who has been
12 assigned under this subsection, shall be given the
13 opportunity to change that choice or assignment at least once
14 every 12 months, as determined by the Illinois Department by
15 rule. The Illinois Department shall maintain a toll-free
16 telephone number for program enrollees' use in reporting
17 problems with managed health care entities.
18 (f) If a person becomes eligible for participation in
19 the integrated health care program while he or she is
20 hospitalized, the Illinois Department may not enroll that
21 person in the program until after he or she has been
22 discharged from the hospital. This subsection does not apply
23 to newborn infants whose mothers are enrolled in the
24 integrated health care program.
25 (g) The Illinois Department shall, by rule, establish
26 for managed health care entities rates that (i) are certified
27 to be actuarially sound, as determined by an actuary who is
28 an associate or a fellow of the Society of Actuaries or a
29 member of the American Academy of Actuaries and who has
30 expertise and experience in medical insurance and benefit
31 programs, in accordance with the Illinois Department's
32 current fee-for-service payment system, and (ii) take into
33 account any difference of cost to provide health care to
34 different populations based on gender, age, location, and
HB0776 Engrossed -36- LRB9000964DJcd
1 eligibility category. The rates for managed health care
2 entities shall be determined on a capitated basis.
3 The Illinois Department by rule shall establish a method
4 to adjust its payments to managed health care entities in a
5 manner intended to avoid providing any financial incentive to
6 a managed health care entity to refer patients to a county
7 provider, in an Illinois county having a population greater
8 than 3,000,000, that is paid directly by the Illinois
9 Department. The Illinois Department shall by April 1, 1997,
10 and annually thereafter, review the method to adjust
11 payments. Payments by the Illinois Department to the county
12 provider, for persons not enrolled in a managed care
13 community network owned or operated by a county provider,
14 shall be paid on a fee-for-service basis under Article XV of
15 this Code.
16 The Illinois Department by rule shall establish a method
17 to reduce its payments to managed health care entities to
18 take into consideration (i) any adjustment payments paid to
19 hospitals under subsection (h) of this Section to the extent
20 those payments, or any part of those payments, have been
21 taken into account in establishing capitated rates under this
22 subsection (g) and (ii) the implementation of methodologies
23 to limit financial liability for managed health care entities
24 under subsection (d) of this Section.
25 (h) For hospital services provided by a hospital that
26 contracts with a managed health care entity, adjustment
27 payments shall be paid directly to the hospital by the
28 Illinois Department. Adjustment payments may include but
29 need not be limited to adjustment payments to:
30 disproportionate share hospitals under Section 5-5.02 of this
31 Code; primary care access health care education payments (89
32 Ill. Adm. Code 149.140); payments for capital, direct medical
33 education, indirect medical education, certified registered
34 nurse anesthetist, and kidney acquisition costs (89 Ill. Adm.
HB0776 Engrossed -37- LRB9000964DJcd
1 Code 149.150(c)); uncompensated care payments (89 Ill. Adm.
2 Code 148.150(h)); trauma center payments (89 Ill. Adm. Code
3 148.290(c)); rehabilitation hospital payments (89 Ill. Adm.
4 Code 148.290(d)); perinatal center payments (89 Ill. Adm.
5 Code 148.290(e)); obstetrical care payments (89 Ill. Adm.
6 Code 148.290(f)); targeted access payments (89 Ill. Adm. Code
7 148.290(g)); Medicaid high volume payments (89 Ill. Adm. Code
8 148.290(h)); and outpatient indigent volume adjustments (89
9 Ill. Adm. Code 148.140(b)(5)).
10 (i) For any hospital eligible for the adjustment
11 payments described in subsection (h), the Illinois Department
12 shall maintain, through the period ending June 30, 1995,
13 reimbursement levels in accordance with statutes and rules in
14 effect on April 1, 1994.
15 (j) Nothing contained in this Code in any way limits or
16 otherwise impairs the authority or power of the Illinois
17 Department to enter into a negotiated contract pursuant to
18 this Section with a managed health care entity, including,
19 but not limited to, a health maintenance organization, that
20 provides for termination or nonrenewal of the contract
21 without cause upon notice as provided in the contract and
22 without a hearing.
23 (k) Section 5-5.15 does not apply to the program
24 developed and implemented pursuant to this Section.
25 (l) The Illinois Department shall, by rule, define those
26 chronic or acute medical conditions of childhood that require
27 longer-term treatment and follow-up care. The Illinois
28 Department shall ensure that services required to treat these
29 conditions are available through a separate delivery system.
30 A managed health care entity that contracts with the
31 Illinois Department may refer a child with medical conditions
32 described in the rules adopted under this subsection directly
33 to a children's hospital or to a hospital, other than a
34 children's hospital, that is qualified to provide inpatient
HB0776 Engrossed -38- LRB9000964DJcd
1 and outpatient services to treat those conditions. The
2 Illinois Department shall provide fee-for-service
3 reimbursement directly to a children's hospital for those
4 services pursuant to Title 89 of the Illinois Administrative
5 Code, Section 148.280(a), at a rate at least equal to the
6 rate in effect on March 31, 1994. For hospitals, other than
7 children's hospitals, that are qualified to provide inpatient
8 and outpatient services to treat those conditions, the
9 Illinois Department shall provide reimbursement for those
10 services on a fee-for-service basis, at a rate at least equal
11 to the rate in effect for those other hospitals on March 31,
12 1994.
13 A children's hospital shall be directly reimbursed for
14 all services provided at the children's hospital on a
15 fee-for-service basis pursuant to Title 89 of the Illinois
16 Administrative Code, Section 148.280(a), at a rate at least
17 equal to the rate in effect on March 31, 1994, until the
18 later of (i) implementation of the integrated health care
19 program under this Section and development of actuarially
20 sound capitation rates for services other than those chronic
21 or acute medical conditions of childhood that require
22 longer-term treatment and follow-up care as defined by the
23 Illinois Department in the rules adopted under this
24 subsection or (ii) March 31, 1996.
25 Notwithstanding anything in this subsection to the
26 contrary, a managed health care entity shall not consider
27 sources or methods of payment in determining the referral of
28 a child. The Illinois Department shall adopt rules to
29 establish criteria for those referrals. The Illinois
30 Department by rule shall establish a method to adjust its
31 payments to managed health care entities in a manner intended
32 to avoid providing any financial incentive to a managed
33 health care entity to refer patients to a provider who is
34 paid directly by the Illinois Department.
HB0776 Engrossed -39- LRB9000964DJcd
1 (m) Behavioral health services provided or funded by the
2 Department of Human Services, the Department of Children and
3 Family Services, and the Illinois Department shall be
4 excluded from a benefit package. Conditions of an organic or
5 physical origin or nature, including medical detoxification,
6 however, may not be excluded. In this subsection,
7 "behavioral health services" means mental health services and
8 subacute alcohol and substance abuse treatment services, as
9 defined in the Illinois Alcoholism and Other Drug Dependency
10 Act. In this subsection, "mental health services" includes,
11 at a minimum, the following services funded by the Illinois
12 Department, the Department of Human Services (as successor to
13 the Department of Mental Health and Developmental
14 Disabilities), or the Department of Children and Family
15 Services: (i) inpatient hospital services, including related
16 physician services, related psychiatric interventions, and
17 pharmaceutical services provided to an eligible recipient
18 hospitalized with a primary diagnosis of psychiatric
19 disorder; (ii) outpatient mental health services as defined
20 and specified in Title 59 of the Illinois Administrative
21 Code, Part 132; (iii) any other outpatient mental health
22 services funded by the Illinois Department pursuant to the
23 State of Illinois Medicaid Plan; (iv) partial
24 hospitalization; and (v) follow-up stabilization related to
25 any of those services. Additional behavioral health services
26 may be excluded under this subsection as mutually agreed in
27 writing by the Illinois Department and the affected State
28 agency or agencies. The exclusion of any service does not
29 prohibit the Illinois Department from developing and
30 implementing demonstration projects for categories of persons
31 or services. The Department of Children and Family Services
32 and the Department of Human Services shall each adopt rules
33 governing the integration of managed care in the provision of
34 behavioral health services. The State shall integrate managed
HB0776 Engrossed -40- LRB9000964DJcd
1 care community networks and affiliated providers, to the
2 extent practicable, in any separate delivery system for
3 mental health services.
4 (n) The Illinois Department shall adopt rules to
5 establish reserve requirements for managed care community
6 networks, as required by subsection (a), and health
7 maintenance organizations to protect against liabilities in
8 the event that a managed health care entity is declared
9 insolvent or bankrupt. If a managed health care entity other
10 than a county provider is declared insolvent or bankrupt,
11 after liquidation and application of any available assets,
12 resources, and reserves, the Illinois Department shall pay a
13 portion of the amounts owed by the managed health care entity
14 to providers for services rendered to enrollees under the
15 integrated health care program under this Section based on
16 the following schedule: (i) from April 1, 1995 through June
17 30, 1998, 90% of the amounts owed; (ii) from July 1, 1998
18 through June 30, 2001, 80% of the amounts owed; and (iii)
19 from July 1, 2001 through June 30, 2005, 75% of the amounts
20 owed. The amounts paid under this subsection shall be
21 calculated based on the total amount owed by the managed
22 health care entity to providers before application of any
23 available assets, resources, and reserves. After June 30,
24 2005, the Illinois Department may not pay any amounts owed to
25 providers as a result of an insolvency or bankruptcy of a
26 managed health care entity occurring after that date. The
27 Illinois Department is not obligated, however, to pay amounts
28 owed to a provider that has an ownership or other governing
29 interest in the managed health care entity. This subsection
30 applies only to managed health care entities and the services
31 they provide under the integrated health care program under
32 this Section.
33 (o) Notwithstanding any other provision of law or
34 contractual agreement to the contrary, providers shall not be
HB0776 Engrossed -41- LRB9000964DJcd
1 required to accept from any other third party payer the rates
2 determined or paid under this Code by the Illinois
3 Department, managed health care entity, or other health care
4 delivery system for services provided to recipients.
5 (p) The Illinois Department may seek and obtain any
6 necessary authorization provided under federal law to
7 implement the program, including the waiver of any federal
8 statutes or regulations. The Illinois Department may seek a
9 waiver of the federal requirement that the combined
10 membership of Medicare and Medicaid enrollees in a managed
11 care community network may not exceed 75% of the managed care
12 community network's total enrollment. The Illinois
13 Department shall not seek a waiver of this requirement for
14 any other category of managed health care entity. The
15 Illinois Department shall not seek a waiver of the inpatient
16 hospital reimbursement methodology in Section 1902(a)(13)(A)
17 of Title XIX of the Social Security Act even if the federal
18 agency responsible for administering Title XIX determines
19 that Section 1902(a)(13)(A) applies to managed health care
20 systems.
21 Notwithstanding any other provisions of this Code to the
22 contrary, the Illinois Department shall seek a waiver of
23 applicable federal law in order to impose a co-payment system
24 consistent with this subsection on recipients of medical
25 services under Title XIX of the Social Security Act who are
26 not enrolled in a managed health care entity. The waiver
27 request submitted by the Illinois Department shall provide
28 for co-payments of up to $0.50 for prescribed drugs and up to
29 $0.50 for x-ray services and shall provide for co-payments of
30 up to $10 for non-emergency services provided in a hospital
31 emergency room and up to $10 for non-emergency ambulance
32 services. The purpose of the co-payments shall be to deter
33 those recipients from seeking unnecessary medical care.
34 Co-payments may not be used to deter recipients from seeking
HB0776 Engrossed -42- LRB9000964DJcd
1 necessary medical care. No recipient shall be required to
2 pay more than a total of $150 per year in co-payments under
3 the waiver request required by this subsection. A recipient
4 may not be required to pay more than $15 of any amount due
5 under this subsection in any one month.
6 Co-payments authorized under this subsection may not be
7 imposed when the care was necessitated by a true medical
8 emergency. Co-payments may not be imposed for any of the
9 following classifications of services:
10 (1) Services furnished to person under 18 years of
11 age.
12 (2) Services furnished to pregnant women.
13 (3) Services furnished to any individual who is an
14 inpatient in a hospital, nursing facility, intermediate
15 care facility, or other medical institution, if that
16 person is required to spend for costs of medical care all
17 but a minimal amount of his or her income required for
18 personal needs.
19 (4) Services furnished to a person who is receiving
20 hospice care.
21 Co-payments authorized under this subsection shall not be
22 deducted from or reduce in any way payments for medical
23 services from the Illinois Department to providers. No
24 provider may deny those services to an individual eligible
25 for services based on the individual's inability to pay the
26 co-payment.
27 Recipients who are subject to co-payments shall be
28 provided notice, in plain and clear language, of the amount
29 of the co-payments, the circumstances under which co-payments
30 are exempted, the circumstances under which co-payments may
31 be assessed, and their manner of collection.
32 The Illinois Department shall establish a Medicaid
33 Co-Payment Council to assist in the development of co-payment
34 policies for the medical assistance program. The Medicaid
HB0776 Engrossed -43- LRB9000964DJcd
1 Co-Payment Council shall also have jurisdiction to develop a
2 program to provide financial or non-financial incentives to
3 Medicaid recipients in order to encourage recipients to seek
4 necessary health care. The Council shall be chaired by the
5 Director of the Illinois Department, and shall have 6
6 additional members. Two of the 6 additional members shall be
7 appointed by the Governor, and one each shall be appointed by
8 the President of the Senate, the Minority Leader of the
9 Senate, the Speaker of the House of Representatives, and the
10 Minority Leader of the House of Representatives. The Council
11 may be convened and make recommendations upon the appointment
12 of a majority of its members. The Council shall be appointed
13 and convened no later than September 1, 1994 and shall report
14 its recommendations to the Director of the Illinois
15 Department and the General Assembly no later than October 1,
16 1994. The chairperson of the Council shall be allowed to
17 vote only in the case of a tie vote among the appointed
18 members of the Council.
19 The Council shall be guided by the following principles
20 as it considers recommendations to be developed to implement
21 any approved waivers that the Illinois Department must seek
22 pursuant to this subsection:
23 (1) Co-payments should not be used to deter access
24 to adequate medical care.
25 (2) Co-payments should be used to reduce fraud.
26 (3) Co-payment policies should be examined in
27 consideration of other states' experience, and the
28 ability of successful co-payment plans to control
29 unnecessary or inappropriate utilization of services
30 should be promoted.
31 (4) All participants, both recipients and
32 providers, in the medical assistance program have
33 responsibilities to both the State and the program.
34 (5) Co-payments are primarily a tool to educate the
HB0776 Engrossed -44- LRB9000964DJcd
1 participants in the responsible use of health care
2 resources.
3 (6) Co-payments should not be used to penalize
4 providers.
5 (7) A successful medical program requires the
6 elimination of improper utilization of medical resources.
7 The integrated health care program, or any part of that
8 program, established under this Section may not be
9 implemented if matching federal funds under Title XIX of the
10 Social Security Act are not available for administering the
11 program.
12 The Illinois Department shall submit for publication in
13 the Illinois Register the name, address, and telephone number
14 of the individual to whom a request may be directed for a
15 copy of the request for a waiver of provisions of Title XIX
16 of the Social Security Act that the Illinois Department
17 intends to submit to the Health Care Financing Administration
18 in order to implement this Section. The Illinois Department
19 shall mail a copy of that request for waiver to all
20 requestors at least 16 days before filing that request for
21 waiver with the Health Care Financing Administration.
22 (q) After the effective date of this Section, the
23 Illinois Department may take all planning and preparatory
24 action necessary to implement this Section, including, but
25 not limited to, seeking requests for proposals relating to
26 the integrated health care program created under this
27 Section.
28 (r) In order to (i) accelerate and facilitate the
29 development of integrated health care in contracting areas
30 outside counties with populations in excess of 3,000,000 and
31 counties adjacent to those counties and (ii) maintain and
32 sustain the high quality of education and residency programs
33 coordinated and associated with local area hospitals, the
34 Illinois Department may develop and implement a demonstration
HB0776 Engrossed -45- LRB9000964DJcd
1 program for managed care community networks owned, operated,
2 or governed by State-funded medical schools. The Illinois
3 Department shall prescribe by rule the criteria, standards,
4 and procedures for effecting this demonstration program.
5 (s) (Blank).
6 (t) On April 1, 1995 and every 6 months thereafter, the
7 Illinois Department shall report to the Governor and General
8 Assembly on the progress of the integrated health care
9 program in enrolling clients into managed health care
10 entities. The report shall indicate the capacities of the
11 managed health care entities with which the State contracts,
12 the number of clients enrolled by each contractor, the areas
13 of the State in which managed care options do not exist, and
14 the progress toward meeting the enrollment goals of the
15 integrated health care program.
16 (u) The Illinois Department may implement this Section
17 through the use of emergency rules in accordance with Section
18 5-45 of the Illinois Administrative Procedure Act. For
19 purposes of that Act, the adoption of rules to implement this
20 Section is deemed an emergency and necessary for the public
21 interest, safety, and welfare.
22 (Source: P.A. 88-554, eff. 7-26-94; 89-21, eff. 7-1-95;
23 89-507, eff. 7-1-97; 89-673, eff. 8-14-96; revised 8-26-96.)
24 (305 ILCS 5/5-16.10 new)
25 Sec. 5-16.10. Managed care entities; marketing. A
26 managed health care entity providing services under this
27 Article V may not engage in door-to-door marketing activities
28 or marketing activities at an office of the Illinois
29 Department or a county department in order to enroll
30 recipients in the entity's health care delivery system. The
31 Department shall adopt rules defining "marketing activities"
32 prohibited by this Section.
33 Before a managed health care entity providing services
HB0776 Engrossed -46- LRB9000964DJcd
1 under this Article V may market its health care delivery
2 system to recipients, the Illinois Department must approve a
3 marketing plan submitted by the entity to the Illinois
4 Department. The Illinois Department shall adopt guidelines
5 for approving marketing plans submitted by managed health
6 care entities under this Section. Besides prohibiting
7 door-to-door marketing activities and marketing activities at
8 public aid offices, the guidelines shall include at least the
9 following:
10 (1) A managed health care entity may not offer or
11 provide any gift, favor, or other inducement in marketing
12 its health care delivery system to integrated health care
13 program enrollees. A managed health care entity may
14 provide health care related items that are of nominal
15 value and pre-approved by the Department to prospective
16 enrollees. A managed health care entity may also
17 provide to enrollees health care related items that have
18 been pre-approved by the Department as an incentive to
19 manage their health care appropriately.
20 (2) All persons employed or otherwise engaged by a
21 managed health care entity to market the entity's health
22 care delivery system to recipients or to supervise that
23 marketing shall register with the Illinois Department.
24 The Inspector General appointed under Section 12-13.1 may
25 conduct investigations to determine whether the marketing
26 practices of managed health care entities providing services
27 under this Article V comply with the guidelines.
28 Section 95. No acceleration or delay. Where this Act
29 makes changes in a statute that is represented in this Act by
30 text that is not yet or no longer in effect (for example, a
31 Section represented by multiple versions), the use of that
32 text does not accelerate or delay the taking effect of (i)
33 the changes made by this Act or (ii) provisions derived from
HB0776 Engrossed -47- LRB9000964DJcd
1 any other Public Act.
2 Section 99. Effective date. This Act takes effect upon
3 becoming law.