SUBTITLE A -- ACCESS TO CARE

Some people experience difficulties in obtaining access to appropriate medical care in managed care settings. This bill establishes a set of standards that health plans must meet. To the extent services are covered under a benefit package, they must be provided according to these common-sense rules.

• Sec. 101. ACCESS TO EMERGENCY SERVICES: Because of fear of denial of coverage, managed care patients have died delaying seeking emergency care or been injured when driving past nearby emergency rooms to more distant network ERs. The bill would remove these major barriers to emergency care by prohibiting prior authorization for emergency care. Coverage of emergency care, including out-of-network care, is based upon the "prudent layperson" standard, which means that a health plan is required to cover an emergency visit based on the symptoms rather than the final diagnosis. This prevents health plans from being able to deny coverage for an emergency visit for a suspected heart attack that turns out to be severe indigestion. The bill also prohibits plans from charging patients more for out-of-network emergency care. In addition, plans are required to cover post-stabilization and maintenance care, when necessary, pursuant to guidelines already being established by the Secretary of HHS for Medicare and Medicaid.

• Sec. 102. COVERAGE OPTIONS: Some patients in closed-panel HMOs may need the option to see non-participating providers. Unfortunately, such choice is often not available to consumers today if their employers offer only one plan. Studies have shown that when a person has a "choice" of health plans offered to them, their level of satisfaction with their care increases enormously.

  Under this bill, if an employer offers only one health plan and that health plan is a closed panel HMO, that plan is required to offer the employees the opportunity to purchase a point-of-service option in addition to the basic plan offered through the employer. The offer is made upon enrollment and does not require any contributions from the employer.

• Sec. 103. CHOICE OF PROVIDERS: Health plans must offer their patients the freedom to choose among available primary care providers and specialty care providers. In the case of specialists, the plan can limit patients' choice to a set number of specialty providers if the plan has notified patients that there will be such limits.

• Sec. 104. ACCESS TO SPECIALTY CARE: Uncertainty about whether a health plan will meet a particular health need generates legitimate, grave concerns. This bill establishes certain standards to ensure hassle-free access to appropriate specialty care as follows:

  Obstetrical and Gynecological Care: Women are able to select their OB-GYN as their primary care provider. Women can directly access OB-GYNs for routine gynecological care and pregnancy-related services without prior authorization from their primary care providers.

  Specialty Care: Plans must have a process for individuals with serious or chronic conditions to be referred to specialists. If the plan does not have an appropriate specialist in-network, it must provide an outside referral to such a specialist at no additional cost to the patient.

  For example, if a child needed a pediatric neurologist, but the plan only had an adult neurologist, that plan would refer the child to such an outside specialist at no extra-cost to the family than if the care had been provided in-network.

  Under this bill, patients with serious, on-going medical conditions are able to choose a specialist to coordinate their primary and specialty care. The patient would be able to access this doctor without a referral from the traditional primary care provider, or so- called "gatekeeper" and the specialist could act as the primary care provider for that patient.

  Health plans must have a process to allow for a "standing referral" to ease the ability of patients with conditions that require ongoing specialty care to receive that care.

• Sec. 105. CONTINUITY OF CARE: When health plans terminate providers without cause or when employers switch health plans for their employees, quality of care for patients currently undergoing treatment can be severely threatened. This bill allows for a transition program to lessen those problems.

  Patients are able to continue the course of treatment with the terminated provider (or a provider who is not in their new plan in the case of an employer changing plans) for up to 90 days. Longer exceptions are allowed for institutionalized patients, pregnant women, and terminally ill patients. In all instances, the health care providers must agree to accept the payment rates and policies and procedures of the pertinent health plan in order to continue the care.

• Sec. 106. COVERAGE FOR INDIVIDUALS PARTICIPATING IN APPROVED CLINICAL TRIALS: For certain illnesses, care through a clinical trial may be the only hope for a cure. This bill prohibits health plans from denying patients participation in a defined category of clinical trials and requires plans to cover the routine patient costs of participation. In order to qualify, an individual must have a life threatening or serious illness for which no standard treatment is effective, must meet the protocols of the clinical trial, and participation must offer meaningful potential for significant clinical benefit. In addition, either the patient's doctor must conclude such treatment is appropriate, or the patient must have medical data that supports enrollment in the trial. The health plan pays the clinical trial sponsor for routine care at an agreed-upon rate or at the same rates they would have paid for care within their plan. There are specific eligibility criteria used to define a qualified clinical trial.

• Sec. 107. ACCESS TO NEEDED PRESCRIPTION DRUGS: Health plans today typically use drug formularies to hold down costs. These formularies dictate which particular drugs a provider may prescribe. If a health plan provides coverage for prescription drugs through a formulary, participating physicians and pharmacists must be involved in the development of the formulary. Plans must disclose formulary restrictions and provide an exception process that enables coverage of non-formulary treatments when medically indicated.

• Sec. 108. ADEQUACY OF PROVIDER NETWORK: Health plans are required to have a sufficient number, distribution and variety of participating qualified health care professionals to assure that all covered health care services are available and accessible in a timely manner to all plan members.

• Sec. 109. NONDISCRIMINATION IN DELIVERY OF HEALTH SERVICES: Health plans may not discriminate in the delivery of health care against any member based on race, ethnicity, national origin, religion, sex, age, mental or physical disability, sexual orientation, genetic information, or source of payment. This only applies to care provided to plan enrollees and does not affect the issuance of insurance.

SUBTITLE B -- QUALITY ASSURANCE

In today's health care system, patients have real concerns that quality of care is taking a backseat to cost containment. The bill makes health plans responsible for following basic guidelines to ensure quality is monitored and improved.

• Sec. 111. INTERNAL QUALITY ASSURANCE PROGRAM: Health plans must maintain an ongoing internal quality assurance program. Criteria used to assess quality include: how well a health plan provides preventive care and meets the special needs of its members (such as children or the chronically ill). Plans must identify the "outcomes" of care: do members stay well, or if they become sick, are they treated successfully? Plans can meet these requirements by meeting Medicare's HMO standards or by being accredited through a national accreditation organization that is certified by the Secretary of HHS as having standards that are at least as stringent as those in this bill.

• Sec. 112. COLLECTION OF STANDARDIZED DATA: Enrollees, prospective enrollees, and employers need standardized information on health plans to compare quality and decide which plans best meet their needs. Each health plan must collect and report uniform quality data to the Secretary that includes: aggregate utilization data, the demographic characteristics of members, disease-specific and age-specific mortality rates, satisfaction of enrollees (including voluntary disenrollment and grievance and appeals data), and quality indicators.

• Sec. 113. PROCESS FOR SELECTION OF PROVIDERS: Health plans must have a written process for the selection of participating health care providers that includes minimum professional requirements. Plans cannot use a doctor's high-risk patient base or location in an area with residents in poorer health status as a basis for excluding them from participation. Health plans may not discriminate against providers acting within the scope of their license solely on the basis of that license. However, health plans are not prohibited from arranging their provider networks to meet the needs of their members. In addition, health plans cannot discriminate in their selection of participating providers based on race, national origin, sex, age, religion, disability, or sexual orientation.

• Sec. 114. DRUG UTILIZATION PROGRAM: Managed care enrollees -- and their doctors -- are concerned that health plans use non-medical or lower level staff to deny medical care that doctors prescribe in order to save money. If a health plan provides coverage for prescription drugs, it must establish and maintain a program that encourages the appropriate use of prescription drugs and take appropriate action to reduce the incidence of improper drug use and adverse drug reactions and interactions.

• Sec. 115. STANDARDS FOR UTILIZATION REVIEW ACTIVITIES: Health plans that use utilization review for determinations of coverage (or that contract with an outside entity to conduct such reviews) must meet certain standards.

  Standards: The health plan must have written policies and procedures for UR that utilize written clinical review criteria. The utilization review program must be administered by qualified health professionals appropriately trained to conduct utilization review. Utilization review personnel cannot be compensated in a manner that provides any incentive for the person to make inappropriate review decisions, and the number of reviews and their frequency (the "hassle" factor ) must be reasonable. The program must have a toll-free number and be accessible during normal business hours, and have a system to respond to after hours calls. If a service/treatment was pre-authorized, the plan cannot change that coverage retroactively. If a patient or their representative is dissatisfied with a preliminary utilization review decision, the plan must provide the opportunity for them to discuss the decision with the medical director or another appropriate plan representative who has the authority to reverse the initial decision.

  Timing of Decisions: For prior authorization requirements, a decision must be made within three business days (or less, depending upon the medical urgency of the case). For continuation of care, a decision must be completed in one business day. For previously provided services, a decision must be made within 30 days.

  Notice of Adverse Determinations: In the case of an adverse determination, a decision must be provided in writing with an explanation of the reasons for the denial and the patient's right for appeal. The plan must also allow the patient access to the clinical review data relied upon to make the determination.

• Sec. 116. HEALTH CARE QUALITY ADVISORY BOARD: A private/public advisory board would be established to advise the Secretary of HHS on the standardized minimum data set and other activities to improve health care quality.

SUBTITLE C -- PATIENT INFORMATION

Purchasers -- both individual patients and employers -- need reliable and complete information on health plans if they are to choose the best plan available to meet their needs. Well-run health plans already provide, or should be able to easily provide, most of this information. To avoid information overload, the bill requires that only the most important information be automatically provided while other, more detailed information is available upon request. The information must be in a uniform format which allows comparison among plans, and must be updated on a regular basis.

• Sec. 121. PATIENT INFORMATION: The information that must be provided includes:
  • The service area of the plan.

  • BENEFITS: Any limits and exclusions; the cost sharing requirements (including maximum out-of-pocket expenses); ability to obtain benefits from out-of-network providers; the extent to which enrollees can select among participating providers; the process and procedures for coverage of emergency services; the process for determining experimental coverage; and whether the plan uses a prescription drug formulary.

  • ACCESS: The number, mix and distribution of providers in the plan; whether out-of-network care is covered; any point-of-service option that is offered (including cost of any premium associated with it); procedures for patients to select, change and access participating primary and specialty providers; procedures to obtain referrals; a list of participating providers (including name, address, and phone) and an indication of whether they are accepting new patients; any limitations imposed by the plan on the selection of providers; how the health plan addresses the needs of non-English speaking members (if more than 5% of the enrollees speak a language other than English, then information must be provided in their language).

  • OUT-OF-AREA COVERAGE: How the health plan provides out-of-area coverage.

  • EMERGENCY COVERAGE: A description of the appropriate use of emergency services, including the use of 911; the process and procedures of the plan for obtaining emergency services; and the location of emergency departments and other plan settings where in-network emergency services are provided.

  • LOSS RATIOS: Disclosure of the medical loss ratio of the plan.

  • RULES FOR PRIOR AUTHORIZATION: Potential for non-coverage or non- payment if plan procedures are not followed.

  • GRIEVANCE AND APPEALS PROCEDURES: An explanation of the plan's process and notification about the ombudsman program which can assist consumers in this process.

  • QUALITY ASSURANCE: A summary description of the quality data that is collected including data on satisfaction of plan members, including data on voluntary disenrollment and the grievance and appeals process.

  • SUMMARY OF PROVIDER FINANCIAL INCENTIVES.

  • INFORMATION ON ISSUER: Appropriate mailing addresses and telephone numbers to be used by patients for contacts with the plan.

  • NOTICE OF INFORMATION AVAILABLE UPON REQUEST: The plan must inform members of other information that they may request about the plan.

  Further or more detailed data must be available upon request, such as:

  • UTILIZATION REVIEW ACTIVITIES: A description of the procedures used for utilization review, including the use of any drug formularies.

  • GRIEVANCE AND APPEALS INFORMATION: The aggregate number and disposition of such cases.

  • METHOD OF PHYSICIAN COMPENSATION: A summary description of the method the plan uses to compensate physicians, including the existence of any financial incentive arrangements.

  • CREDENTIALS OF PARTICIPATING PROVIDERS: A description of the credentials of each participation provider.

  • CONFIDENTIALITY: An explanation of the plan procedures to assure confidentiality of patients' records.

  • DESCRIPTION OF ANY FORMULARY RESTRICTIONS.

  • PARTICIPATING PROVIDERS LIST: A current list must be available.

• Sec. 122. Patient Confidentiality: Health plans are required to establish procedures to safeguard the privacy of any individually identifiable information, to maintain such records and information in a manner that is accurate and timely, and to assure timely access of such individuals to such records and information. (This is the same as the confidentiality requirements of the Balanced Budget Act of 1997).

• Sec. 123. Health Plan Ombudsmen: Even with the best information and grievance and appeals rights, the health care marketplace can be confusing. The bill establishes grants for states to establish health insurance ombudsman programs to help people navigate the system. If a state does not establish such an office, HHS will provide the services in that state. The duties of the ombudsmen include helping people choose among plans and assisting those who encounter difficulty in using a plan.

SUBTITLE D -- GRIEVANCE AND APPEALS PROCEDURES

Within a managed care plan, consumers are concerned that it is difficult to register complaints or obtain reconsideration of a decision , that appeals of coverage decisions are not fair and can take too long, and that patients' health or life can be severely compromised while fighting a plan's bureaucracy.

The bill establishes a system for processing complaints and appealing adverse decisions on a timely, fair basis, with expedited procedures for life-threatening situations. The system includes an independent external appeals process, which is fundamental to assuring that decisions to deny or approve care are based on medical appropriateness -- not cost.

• Sec. 131. ESTABLISHMENT OF PROCESS: A plan must have in place a system to provide for the presentation and resolution of grievances brought by plan members, including a written explanation of the process, a system to document and track cases, and systems that assure timely resolution.

• Sec. 132. INTERNAL APPEALS OF ADVERSE DETERMINATIONS: Appealable decisions are any of the following: the denial, reduction or termination of benefits because it was determined experimental or not medically necessary or appropriate; failure to cover emergency services; failure to provide a choice of provider; failure to furnish qualified providers; denial of access to specialists; failure to provide continuation care; failure to provide coverage of routine patient costs under approved clinical trials; failure to provide access to needed drugs; discrimination in delivery of services.

  The process must include a health care professional who is independent of the case at hand and it must also include a health professional (who may be the same person) with the same training/expertise as the case being brought before them. This process must be timely, based on the medical urgency of the case, but no longer than 72 hours for expedited cases and 15 business days in the case of all other appeals. With cause, the plan may extend the time period for resolution of an appeal, except in expedited cases where no extension is allowed. If the appeal is denied, the plan must provide the patient with an explanation of the denial in writing and notification of their rights to an external appeal.

  Expedited appeals: Some cases may require immediate attention. For that reason, enrollees may access an expedited review.

  Right to external appeal: If the plan does not meet the deadlines of the above process, the patient has the right to go directly to the external process, if the case meets the criteria for that level of appeal.

• Sec. 133. EXTERNAL APPEALS OF ADVERSE DETERMINATIONS: The external appeal process is used for cases not resolved through the internal process -- or cases which the plan did not complete under the appropriate timeline -- and must involve a claim in which the decision is based on a determination that such services are not medically necessary and the amount exceeds a significant threshold, or the patient's life or health is jeopardized. The procedure may vary depending whether it is for ERISA self-insured plans or for traditional insurance plans. In each case, the applicable state or federal authority can choose to construct their own external review entity, certify one external review entity, or certify multiple such entities. Such entities must also meet recertification standards. Each health plan must then have a contract with the appropriate entity (ies) which includes payment by the plan for the direct costs of the external appeal process.

  The external appeal process must provide for a fair, "de novo" determination ( meaning the case is reviewed anew). The external appeal entity makes the determination if this is an urgent case that requires an expedited process. All participants have the opportunity to submit evidence, and the right to an oral presentation. The plan is also required to provide timely access to all information. The timeline of these decisions are that they should be made as quickly as possible, but in no case more than 72 hours for expedited decisions and 60 days for other decisions. In addition, the external appeal entity must inform patients of their rights to proceed to the courts.

  Qualifications of external review entities: The entities must meet the following standards: there be no real or apparent conflict of interest; that external appeals are conducted using clinical peers (health professionals with the same training); and have sufficient medical, legal, and other expertise and staffing to appropriately conduct the required activities. In addition, in states that choose to allow health plans to select among multiple external appeals entities, the state must conduct an audit of a sample of decisions to ensure that there is no bias in the decision-making process on the part of the external appeal entities.

SUBTITLE E -- PROTECTING THE DOCTOR-PATIENT RELATIONSHIP

• Sec. 141. PROHIBITION OF INTERFERENCE WITH CERTAIN MEDICAL COMMUNICATIONS: Consumers have legitimate fears that medical decision-making in many managed care plans is made by company bureaucrats with actuarial guidelines rather than their own doctors. In some cases, the health plan administrators refuse to allow doctors to tell a patient that a particular service might be appropriate because it would cost the health plan too much money.

  To address this issue, the bill prohibits the use of "gag clauses" that hinder open communication between health care professionals and their patients.

• Sec. 142. PROHIBITION AGAINST TRANSFER OF INDEMNIFICATION OR IMPROPER INCENTIVE ARRANGEMENTS: Some doctors may be reluctant to refer patients to specialists because of financial penalties imposed on the doctor as a result of such a referral. The bill ends a plan's ability to transfer liability in this fashion from the plan to the provider. And, it limits financial incentives to underserve consistent with current Medicare law.

• Sec. 143. ADDITIONAL PROVIDER PARTICIPATION RULES: The bill establishes a set of reasonable procedures relating to the participation of health professionals. Such procedures include: notice of the plan participation rules, written notice of adverse participation decisions, a process within the plan for appealing such adverse decisions, and consultation with participating health professionals regarding plan policies.

• Sec. 144 PROTECTION FOR PATIENT ADVOCACY:

  Often, health care professionals are the first ones to notice quality of care problems. However, since these individuals are paid by the health plan, they are often in a position that prevents them from coming forward with their concerns -- even for individual patients.

  Protection for Use of Utilization Review and Grievance Process: Health care providers who advocate on behalf of a patient, with the patient s consent, through the utilization review or grievance process are protected from retaliation by the health plan. Health plan members are also protected from any such action.

  Protection for Quality Advocacy by Health Care Professionals: Health care professionals who in good faith disclose quality of care concerns to an appropriate public regulatory agency, an appropriate private accreditation body, or appropriate management personnel of the health plan or institutional provider are protected from retribution by health plans. This protection extends to the participation, initiation or cooperation of a health care professional in an investigation or proceeding by an above listed agency.

SUBTITLE F -- PROMOTING GOOD MEDICAL PRACTICE

• Sec. 151. PROMOTING GOOD MEDICAL PRACTICE: Decisions about provision of medical care should be based on what is medically appropriate for the patient. They should not be based on the cost considerations of an accountant or bureaucrat.

  The bill would prohibit health plans from arbitrarily overriding medical decisions by your physicians when those decisions are made according to generally accepted principles of medical practice.

Because health plans have gone so far in limiting length-of-stays or denying coverage for women with breast cancer, the bill includes the following two provisions to protect quality of care for women:

• Sec. 152. STANDARD RELATING TO BENEFITS FOR CERTAIN BREAST CANCER TREATMENTS: Health plans must cover a hospital stay of at least 48 hours for women undergoing a mastectomy and no less than 24 hours for women having a lumpectomy with lymph node dissection. Doctors and patients, not health plan accountants, can decide on earlier discharge or outpatient surgery. This provision does not override more protective state laws.

• Sec. 153. STANDARDS RELATING TO BENEFITS FOR RECONSTRUCTIVE BREAST SURGERY: Health plans that provide coverage for breast surgery in connection with mastectomies shall also provide coverage for prostheses or reconstructive breast surgery, and for lymphodema related to the surgery. This provision does not override more protective state laws.

SUBTITLE G -- DEFINITIONS

• Sec. 191: DEFINITIONS OF TERMS USED IN THE BILL.

• Sec. 192: PREEMPTION; STATE FLEXIBILITY; CONSTRUCTION: Nothing in this bill changes the current health regulatory structure whereby states have authority to regulate fully-insured plans and the Department of Labor maintains jurisdiction over self-insured plans.

The provisions of this title track the structure of the Health Insurance Portability and Accountability Act (HIPAA) to make the same set of protections apply in both the group and the individual health insurance market. Unlike HIPAA, there would be no opt-out for state and local governments.

• Sec. 301. APPLICATION OF PATIENT PROTECTION STANDARDS TO GROUP HEALTH PLANS AND GROUP HEALTH INSURANCE COVERAGE UNDER THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974. This provision extends the bill's patient protection standards to ERISA group health plans. If an employer provides coverage through an insurance plan, they are protected from certain responsibilities that are transferred to the responsibility of the health insurance issuer.

• Sec. 302. ERISA PREEMPTION NOT TO APPLY TO CERTAIN ACTIONS INVOLVING HEALTH INSURANCE POLICY HOLDERS: Because ERISA preempts state laws, health plans are currently not liable (except for the value of the benefit) if they arbitrarily limit care to their patients and the limitation results in harm to the patient. The bill amends ERISA to allow state law to determine whether a patient can bring a state cause of action against health plan administrators who cause harm through their actions. The provision explicitly protects from liability employers who are not involved in the decision-making that resulted in harm.

Following the structure of the Health Insurance Portability and Accountability Act, this title provides enforcement through the Internal Revenue Code.

This title coordinates implementation dates. In general, the effective date is January 1, 1999. For collective bargaining agreements, it is effective after the contract terminates if that is later than the general effective date.

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