Sections related to risk bearing provider organizations
Section 1. Definitions
As used in this chapter the following words shall, unless the context clearly requires otherwise, have the following meanings:—
“Alternative payment contract”, any contract between a provider or provider organization and a health care payer payer which utilizes alternative payment methodologies.
“Alternative payment methodologies or methods”, methods of payment that are not solely based on fee-for-service reimbursements; provided, however, that “alternative payment methodologies” may include, but shall not be limited to, shared savings arrangement, bundled payments, and global payments; and further provided, that “alternative payment methodologies” may include fee-for-service payments, which are settled or reconciled with a bundled or global payment.
“Carrier,” an insurer licensed or otherwise authorized to transact accident or health insurance under chapter 175; a nonprofit hospital service corporation organized under chapter 176A; a nonprofit medical service corporation organized under chapter 176B; a health maintenance organization organized under chapter 176G; and an organization entering into a preferred provider arrangement under chapter 176I, but not including an employer purchasing coverage or acting on behalf of its employees or the employees of 1 or more subsidiaries or affiliated corporations of the employer; provided, however, that, unless otherwise noted, the term “carrier” shall not include any entity to the extent it offers a policy, certificate or contract that provides coverage solely for dental care services or vision care services.
“Center”, the center for health information and analysis established in chapter 12C.
“Commission”, the health policy commission established in chapter 6D.
“Commissioner”, the commissioner of insurance.
“Division”, the division of insurance.
“Downside risk”, the risk taken on by a provider organization as part of an alternate payment contract with a carrier or other payer in which the provider organization is responsible for either the full or partial costs of treating a group of patients that may exceed the contracted budgeted payment arrangements.
“Employer”, an employer as defined in section 1 of chapter 151A.
“Health care services”, supplies, care and services of medical, surgical, optometric, dental, podiatric, chiropractic, psychiatric, therapeutic, diagnostic, preventative, rehabilitative, supportive or geriatric nature including, but not limited to, inpatient and outpatient acute hospital care and services, provided by a community health center, home health and hospice care provider, or by a sanatorium, as included in the definition of “hospital” in Title XVIII of the federal Social Security Act, and treatment and care compatible with such services or by a health maintenance organization.
“Medicaid program”, the medical assistance program administered by the office of Medicaid under chapter 118E and in accordance with Title XIX of the Federal Social Security Act or any successor statute.
“Medical assistance program”, the medicaid program, the Veterans Administration health and hospital programs and any other medical assistance program operated by a governmental unit for persons categorically eligible for such program.
“Medical service corporation”, a corporation established to operate a nonprofit medical service plan as provided in chapter 176B.
“Medicare program”, the medical insurance program established by Title XVIII of the Social Security Act.
“Provider” or “health care provider”, any person, corporation, partnership, governmental unit, state institution or any other entity qualified under the laws of the commonwealth to perform or provide health care services.
“Provider organization”, any corporation, partnership, business trust, association or organized group of persons in the business of health care delivery or management whether incorporated or not that represents 1 or more health care providers in contracting with carriers for the payments of heath care services; provided, however, that “provider organization” shall include, but not be limited to, physician organizations, physician-hospital organizations, independent practice associations, provider networks, accountable care organizations and any other organization that contracts with carriers for payment for health care services.
“Public health care payer”, the Medicaid program established in chapter 118E; any carrier or other entity that contracts with the office of Medicaid to pay for or arrange the purchase of health care services on behalf of individuals enrolled in health coverage programs under Titles XIX or XXI of the Social Security Act, including prepaid health plans subject to section 28 of chapter 47 of the acts of 1997; the group insurance commission established pursuant to chapter 32A; and any city or town with a population of more than 60,000 that has adopted chapter 32B.
“Registered provider organization”, a provider organization that has been registered in accordance with chapter 6D.
“Risk-bearing provider organization”, a provider organization that manages the treatment of a group of patients and bears the downside risk according to the terms of an alternate payment contract.
“Risk certificate”, a certificate of solvency issued by the division of insurance.
“Self-insurance health plan”, a plan which provides health benefits to the employees of a business, which is not a health insurance plan, and in which the business is liable for the actual costs of the health care services provided by the plan and administrative costs.
“Title XIX,” Title XIX of the Social Security Act, 42 USC 1396 et seq., or any successor statute enacted for the same purposes as Title XIX.
Section 2. Risk-bearing provider organization not subject to chapters 175, 176A, 176B, 176C, 176E, 176F, 176G and 176J
Except as hereinafter provided, a risk-bearing provider organization shall not be subject to chapters 175, 176A, 176B, 176C, 176E, 176F, 176G and 176J; provided, however, that a risk-bearing provider organization that enters into a contract with employers or individuals under which the provider organization would assume a significant portion of downside risk, as defined through division regulations, may be subject to the provisions of said chapters 175, 176A, 176B, 176C, 176E, 176F, 176G and 176J for the purposes of such contracts.
Section 3. Risk certificate application; waiver; form; fee
(a) Each registered provider organization that enters into or renews an alternative payment contract with a carrier or public health care payer in which the provider organization accepts downside risk shall file an application for a risk certificate with the division; provided, however, that integrated care organizations or senior care organizations contracted under section 9D or 9E of chapter 118E which have undergone a financial solvency certification shall be deemed to be to have satisfied the risk certificate requirements for purposes of this chapter.
(b) A risk-bearing provider organization may apply for a risk certificate waiver if it wishes to demonstrate that its alternative payment contracts do not contain significant downside risk. A risk-bearing provider organization may be deemed to be in compliance with the division’s standards if the division determines that the provider organization’s alternative payment contracts do not contain significant downside risk. The division shall forward such waiver in writing to the commission and the center.
(c) The applicant for a risk certificate shall file such information as the commissioner shall by regulation require, in a form approved by the commissioner. A risk-bearing provider organization shall make an annual filing to renew its risk certificate. Such information shall include, but not be limited to:
(1) the filing materials submitted to be registered as a provider organization, pursuant to chapter 6D;
(2) a list of all carriers and public health payers with which the provider organization has entered into alternative payment contracts with downside risk;
(3) financial statements showing the risk-bearing provider organization’s assets, liabilities, reserves and sources of working capital and other sources of financial support and projections of the results of operations for the succeeding 3 years;
(4) a financial plan, including a statement indicating the anticipated timing for receipt of income from alternative payment contracts with downside risk versus the incurrence of expenses, a statement of the applicant’s plan to establish and maintain sufficient reserves or other resources that will protect the risk-bearing provider organization from the potential losses from downside risk, copies of insurance or other agreements which protect the risk-bearing provider organization from potential losses from downside risk, and a detailed description of mechanisms to monitor the financial solvency of any provider organization subcontracting with the applicant that assumes downside risk in its alternative payment arrangement with the risk-bearing provider organization;
(5) a utilization plan describing the methods by which the risk-bearing provider organization will monitor inpatient and outpatient utilization under the alternative payment contracts with downside risk;
(6) an actuarial certification that, after examining the terms of all the risk-bearing provider organization’s alternative payment contracts with downside risk that the alternate payment contracts are not expected to threaten the financial solvency of the risk-bearing provider organization; and
(7) such other information as the division may specify through regulation.
(d) There shall be a fee for such application or renewal, in an amount determined by the commissioner.
(e) A risk-bearing provider organization shall notify the commissioner of any material change to the information submitted in its initial or renewal application, in a form approved by the commissioner.
Section 4. Examination of risk-bearing provider organization’s alternate payment arrangements with downside risk; report
(a) The commissioner may make an examination of the affairs of a risk-bearing provider organization regarding its alternate payment arrangements with downside risk when the commissioner deems prudent but, not less frequently than once every 3 years. The focus of the examination shall be to ensure that a risk-bearing provider organization is not subject to adverse conditions which in the commissioner’s determination have at least a moderate potential to impact a risk-bearing entity’s ability to meet its risk-bearing responsibilities under any alternative payment contracts. The examination shall be conducted according to the procedures set forth in subsection (6) of section 4 of chapter 175.
(b) The commissioner, a deputy or an examiner may conduct an on-site examination of each risk-bearing provider organization in the commonwealth to thoroughly inspect and examine its affairs and ascertain its financial condition in the context of its ability to fulfill its risk-bearing obligations.
(c) The charge for each such examination shall be determined annually according to the procedures set forth in subsection (6) of section 4 of chapter 175.
(d) The assets and liabilities of the risk-bearing provider organization shall be allowed and computed, in any report of an examination under this section, in accordance with generally accepted accounting principles or as the commissioner may otherwise deem appropriate.
(e) No later than 60 days following completion of the examination, the examiner in charge shall file with the commissioner a verified written report of examination under oath. Upon receipt of the verified report, the commissioner shall transmit the report to the risk-bearing provider organization examined together with a notice which shall afford the risk-bearing provider organization examined a reasonable opportunity of not more than 30 days to make a written submission or rebuttal with respect to any matters contained in the examination report. Within 30 days of the end of the period allowed for the receipt of written submissions or rebuttals, the commissioner shall consider and review the reports together with any written submissions or rebuttals and any relevant portions of the examiner’s work papers and enter an order:
(i) adopting the examination report as filed with modifications or corrections and, if the examination report reveals that the risk-bearing provider organization is operating in violation of this section or any regulation or prior order of the commissioner, the commissioner may order the risk-bearing provider organization to take any action the commissioner considered necessary and appropriate to cure such violation;
(ii) rejecting the examination report with directions to examiners to reopen the examination for the purposes of obtaining additional data, documentation or information and re-filing pursuant to the above provisions; or
(iii) calling for an investigatory hearing with no less than 20 days notice to the risk-bearing provider organization for purposes of obtaining additional documentation, data, information and testimony.
(f) Notwithstanding any other General Law to the contrary, including clause Twenty-sixth of section 7 of chapter 4 and chapter 66, the records of any such audit, examination or other inspection and the information contained in the records, reports or books of any risk-bearing provider organization examined pursuant to this section shall be confidential and open only to the inspection of the commissioner, or the examiners and assistants. Access to such confidential material may be granted by the commissioner to law enforcement officials of the commonwealth or any other state or agency of the federal government at any time, so long as the agency or office receiving the information agrees in writing to hold such material confidential. Nothing herein shall be construed to prohibit the required production of such records, and information contained in the reports of such company or organization before any court of the commonwealth or any master or auditor appointed by any such court, in any criminal or civil proceeding, affecting such risk-bearing provider organization, its officers, partners, directors or employees. The final report of any such audit, examination or any other inspection by or on behalf of the division of insurance shall be a public record.
Section 5. Threat of financial insolvency due to risk-bearing provider organization’s alternative payment contracts with downside risk; notice; suspension or cancellation of risk certificate; hearing
(a) If upon examination or at any other time the commissioner determines that the risk-bearing provider organization’s existing or proposed alternative payment contracts with downside risk are likely to threaten the financial solvency of the risk-bearing provider organization, the commissioner shall provide notice to the risk-bearing provider organization.
(b) The commissioner may suspend, cancel, non-renew or refuse to issue a risk-bearing provider organization’s risk certificate upon a determination that the risk-bearing provider organization has not cured a threat to financial solvency, that the risk-bearing provider organization’s application for a risk certificate is incomplete or contains or is based on fraudulent information, or that the risk-bearing provider organization has otherwise failed to comply with the requirements of this chapter. The commissioner shall notify the risk-bearing provider organization and advise, in writing, of the reason for any refusal to issue or non-renew a risk certificate under this chapter. A copy of the notice shall be forwarded to the commission and center. The applicant or certified risk-bearing provider organization may make written demand upon the commissioner within 30 days of receipt of such notification for a hearing before the commissioner to determine the reasonableness of the commissioner’s action. The hearing shall be held pursuant to chapter 30A.
(c) The commissioner shall not suspend or cancel a risk certificate unless the commissioner has first afforded the risk-bearing provider organization an opportunity for a hearing pursuant to chapter 30A.
(d) Upon a ruling by the commissioner to suspend or cancel a risk-I bearing provider organization’s certification, a written notice shall be forwarded to the commission and the center.
Section 6: Health care provider prohibited from collecting or attempting to collect money owed by risk-bearing provider organization from patient
Section 6. (a) For purposes of this section, ”health care provider” shall mean any physician, hospital or other person or entity furnishing health services that has contracted to provide services according to its agreements with a risk-bearing provider organization.
(b) A health care provider or any representative of a health care provider shall not maintain any action against a patient to collect or attempt to collect any money owed to the health care provider by a risk-bearing provider organization.
(c) A risk-bearing provider organization shall include provisions within its contracts with health care providers that conspicuously prohibit health care providers from collecting or attempting to collect money from a patient that is owed to the health care provider by a risk-bearing provider organization.
Section 7. Availability of information provided by risk-bearing provider organizations
All information provided by risk-bearing provider organizations to the division under this chapter shall be made available to the center and the commission.
Section 8. Non-exemption of applicable provisions of chapter 111, 112 or 176T
Nothing in this chapter shall exempt any person from any applicable provisions of chapter 111, 112 or 176T including, but not limited to, provisions relating to determination of need, licensure and regulation of hospitals and clinics and registration of health professionals.
Section 9: Promulgation of rules and regulations necessary to carry out provisions of this chapter
The commissioner shall promulgate rules and regulations as are necessary to carry out the provisions of this chapter. In developing the rules and regulations, including risk-bearing standards, certification and reporting requirements, the commissioner shall consider other rules and regulations applicable to such organizations and shall consult with the center and the commission regarding standards concerning provider organizations which enter into alternative payment contracts.