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90_SB0320sam001
LRB9001689SMdvam01
1 AMENDMENT TO SENATE BILL 320
2 AMENDMENT NO. . Amend Senate Bill 320 by replacing
3 the title with the following:
4 "AN ACT to amend the Illinois Public Aid Code by changing
5 Section 5-16.3."; and
6 by replacing everything after the enacting clause with the
7 following:
8 "Section 5. The Illinois Public Aid Code is amended by
9 changing Section 5-16.3 as follows:
10 (305 ILCS 5/5-16.3)
11 (Text of Section before amendment by P.A. 89-507)
12 Sec. 5-16.3. System for integrated health care services.
13 (a) It shall be the public policy of the State to adopt,
14 to the extent practicable, a health care program that
15 encourages the integration of health care services and
16 manages the health care of program enrollees while preserving
17 reasonable choice within a competitive and cost-efficient
18 environment. In furtherance of this public policy, the
19 Illinois Department shall develop and implement an integrated
20 health care program consistent with the provisions of this
21 Section. The provisions of this Section apply only to the
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1 integrated health care program created under this Section.
2 Persons enrolled in the integrated health care program, as
3 determined by the Illinois Department by rule, shall be
4 afforded a choice among health care delivery systems, which
5 shall include, but are not limited to, (i) fee for service
6 care managed by a primary care physician licensed to practice
7 medicine in all its branches, (ii) managed health care
8 entities, and (iii) federally qualified health centers
9 (reimbursed according to a prospective cost-reimbursement
10 methodology) and rural health clinics (reimbursed according
11 to the Medicare methodology), where available. Persons
12 enrolled in the integrated health care program also may be
13 offered indemnity insurance plans, subject to availability.
14 For purposes of this Section, a "managed health care
15 entity" means a health maintenance organization or a managed
16 care community network as defined in this Section. A "health
17 maintenance organization" means a health maintenance
18 organization as defined in the Health Maintenance
19 Organization Act. A "managed care community network" means
20 an entity, other than a health maintenance organization, that
21 is owned, operated, or governed by providers of health care
22 services within this State and that provides or arranges
23 primary, secondary, and tertiary managed health care services
24 under contract with the Illinois Department exclusively to
25 enrollees of the integrated health care program. A managed
26 care community network may contract with the Illinois
27 Department to provide only pediatric health care services. A
28 county provider as defined in Section 15-1 of this Code may
29 contract with the Illinois Department to provide services to
30 enrollees of the integrated health care program as a managed
31 care community network without the need to establish a
32 separate entity that provides services exclusively to
33 enrollees of the integrated health care program and shall be
34 deemed a managed care community network for purposes of this
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1 Code only to the extent of the provision of services to those
2 enrollees in conjunction with the integrated health care
3 program. A county provider shall be entitled to contract
4 with the Illinois Department with respect to any contracting
5 region located in whole or in part within the county. A
6 county provider shall not be required to accept enrollees who
7 do not reside within the county.
8 Each managed care community network must demonstrate its
9 ability to bear the financial risk of serving enrollees under
10 this program. The Illinois Department shall by rule adopt
11 criteria for assessing the financial soundness of each
12 managed care community network. These rules shall consider
13 the extent to which a managed care community network is
14 comprised of providers who directly render health care and
15 are located within the community in which they seek to
16 contract rather than solely arrange or finance the delivery
17 of health care. These rules shall further consider a variety
18 of risk-bearing and management techniques, including the
19 sufficiency of quality assurance and utilization management
20 programs and whether a managed care community network has
21 sufficiently demonstrated its financial solvency and net
22 worth. The Illinois Department's criteria must be based on
23 sound actuarial, financial, and accounting principles. In
24 adopting these rules, the Illinois Department shall consult
25 with the Illinois Department of Insurance. The Illinois
26 Department is responsible for monitoring compliance with
27 these rules.
28 This Section may not be implemented before the effective
29 date of these rules, the approval of any necessary federal
30 waivers, and the completion of the review of an application
31 submitted, at least 60 days before the effective date of
32 rules adopted under this Section, to the Illinois Department
33 by a managed care community network.
34 All health care delivery systems that contract with the
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1 Illinois Department under the integrated health care program
2 shall clearly recognize a health care provider's right of
3 conscience under the Right of Conscience Act. In addition to
4 the provisions of that Act, no health care delivery system
5 that contracts with the Illinois Department under the
6 integrated health care program shall be required to provide,
7 arrange for, or pay for any health care or medical service,
8 procedure, or product if that health care delivery system is
9 owned, controlled, or sponsored by or affiliated with a
10 religious institution or religious organization that finds
11 that health care or medical service, procedure, or product to
12 violate its religious and moral teachings and beliefs.
13 (b) The Illinois Department may, by rule, provide for
14 different benefit packages for different categories of
15 persons enrolled in the program. Mental health services,
16 alcohol and substance abuse services, services related to
17 children with chronic or acute conditions requiring
18 longer-term treatment and follow-up, and rehabilitation care
19 provided by a free-standing rehabilitation hospital or a
20 hospital rehabilitation unit may be excluded from a benefit
21 package if the State ensures that those services are made
22 available through a separate delivery system. An exclusion
23 does not prohibit the Illinois Department from developing and
24 implementing demonstration projects for categories of persons
25 or services. Benefit packages for persons eligible for
26 medical assistance under Articles V, VI, and XII shall be
27 based on the requirements of those Articles and shall be
28 consistent with the Title XIX of the Social Security Act.
29 Nothing in this Act shall be construed to apply to services
30 purchased by the Department of Children and Family Services
31 and the Department of Mental Health and Developmental
32 Disabilities under the provisions of Title 59 of the Illinois
33 Administrative Code, Part 132 ("Medicaid Community Mental
34 Health Services Program").
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1 (c) The program established by this Section may be
2 implemented by the Illinois Department in various contracting
3 areas at various times. The health care delivery systems and
4 providers available under the program may vary throughout the
5 State. For purposes of contracting with managed health care
6 entities and providers, the Illinois Department shall
7 establish contracting areas similar to the geographic areas
8 designated by the Illinois Department for contracting
9 purposes under the Illinois Competitive Access and
10 Reimbursement Equity Program (ICARE) under the authority of
11 Section 3-4 of the Illinois Health Finance Reform Act or
12 similarly-sized or smaller geographic areas established by
13 the Illinois Department by rule. A managed health care entity
14 shall be permitted to contract in any geographic areas for
15 which it has a sufficient provider network and otherwise
16 meets the contracting terms of the State. The Illinois
17 Department is not prohibited from entering into a contract
18 with a managed health care entity at any time.
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
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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
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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
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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.
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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
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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.
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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
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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
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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.
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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
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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.
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1 (m) Behavioral health services provided or funded by the
2 Department of Mental Health and Developmental Disabilities,
3 the Department of Alcoholism and Substance Abuse, the
4 Department of Children and Family Services, and the Illinois
5 Department shall be excluded from a benefit package.
6 Conditions of an organic or physical origin or nature,
7 including medical detoxification, however, may not be
8 excluded. In this subsection, "behavioral health services"
9 means mental health services and subacute alcohol and
10 substance abuse treatment services, as defined in the
11 Illinois Alcoholism and Other Drug Dependency Act. In this
12 subsection, "mental health services" includes, at a minimum,
13 the following services funded by the Illinois Department, the
14 Department of Mental Health and Developmental Disabilities,
15 or the Department of Children and Family Services: (i)
16 inpatient hospital services, including related physician
17 services, related psychiatric interventions, and
18 pharmaceutical services provided to an eligible recipient
19 hospitalized with a primary diagnosis of psychiatric
20 disorder; (ii) outpatient mental health services as defined
21 and specified in Title 59 of the Illinois Administrative
22 Code, Part 132; (iii) any other outpatient mental health
23 services funded by the Illinois Department pursuant to the
24 State of Illinois Medicaid Plan; (iv) partial
25 hospitalization; and (v) follow-up stabilization related to
26 any of those services. Additional behavioral health services
27 may be excluded under this subsection as mutually agreed in
28 writing by the Illinois Department and the affected State
29 agency or agencies. The exclusion of any service does not
30 prohibit the Illinois Department from developing and
31 implementing demonstration projects for categories of persons
32 or services. The Department of Mental Health and
33 Developmental Disabilities, the Department of Children and
34 Family Services, and the Department of Alcoholism and
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1 Substance Abuse shall each adopt rules governing the
2 integration of managed care in the provision of behavioral
3 health services. The State shall integrate managed care
4 community networks and affiliated providers, to the extent
5 practicable, in any separate delivery system for mental
6 health services.
7 (n) The Illinois Department shall adopt rules to
8 establish reserve requirements for managed care community
9 networks, as required by subsection (a), and health
10 maintenance organizations to protect against liabilities in
11 the event that a managed health care entity is declared
12 insolvent or bankrupt. If a managed health care entity other
13 than a county provider is declared insolvent or bankrupt,
14 after liquidation and application of any available assets,
15 resources, and reserves, the Illinois Department shall pay a
16 portion of the amounts owed by the managed health care entity
17 to providers for services rendered to enrollees under the
18 integrated health care program under this Section based on
19 the following schedule: (i) from April 1, 1995 through June
20 30, 1998, 90% of the amounts owed; (ii) from July 1, 1998
21 through June 30, 2001, 80% of the amounts owed; and (iii)
22 from July 1, 2001 through June 30, 2005, 75% of the amounts
23 owed. The amounts paid under this subsection shall be
24 calculated based on the total amount owed by the managed
25 health care entity to providers before application of any
26 available assets, resources, and reserves. After June 30,
27 2005, the Illinois Department may not pay any amounts owed to
28 providers as a result of an insolvency or bankruptcy of a
29 managed health care entity occurring after that date. The
30 Illinois Department is not obligated, however, to pay amounts
31 owed to a provider that has an ownership or other governing
32 interest in the managed health care entity. This subsection
33 applies only to managed health care entities and the services
34 they provide under the integrated health care program under
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1 this Section.
2 (o) Notwithstanding any other provision of law or
3 contractual agreement to the contrary, providers shall not be
4 required to accept from any other third party payer the rates
5 determined or paid under this Code by the Illinois
6 Department, managed health care entity, or other health care
7 delivery system for services provided to recipients.
8 (p) The Illinois Department may seek and obtain any
9 necessary authorization provided under federal law to
10 implement the program, including the waiver of any federal
11 statutes or regulations. The Illinois Department may seek a
12 waiver of the federal requirement that the combined
13 membership of Medicare and Medicaid enrollees in a managed
14 care community network may not exceed 75% of the managed care
15 community network's total enrollment. The Illinois
16 Department shall not seek a waiver of this requirement for
17 any other category of managed health care entity. The
18 Illinois Department shall not seek a waiver of the inpatient
19 hospital reimbursement methodology in Section 1902(a)(13)(A)
20 of Title XIX of the Social Security Act even if the federal
21 agency responsible for administering Title XIX determines
22 that Section 1902(a)(13)(A) applies to managed health care
23 systems.
24 Notwithstanding any other provisions of this Code to the
25 contrary, the Illinois Department shall seek a waiver of
26 applicable federal law in order to impose a co-payment system
27 consistent with this subsection on recipients of medical
28 services under Title XIX of the Social Security Act who are
29 not enrolled in a managed health care entity. The waiver
30 request submitted by the Illinois Department shall provide
31 for co-payments of up to $0.50 for prescribed drugs and up to
32 $0.50 for x-ray services and shall provide for co-payments of
33 up to $10 for non-emergency services provided in a hospital
34 emergency room and up to $10 for non-emergency ambulance
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1 services. The purpose of the co-payments shall be to deter
2 those recipients from seeking unnecessary medical care.
3 Co-payments may not be used to deter recipients from seeking
4 necessary medical care. No recipient shall be required to
5 pay more than a total of $150 per year in co-payments under
6 the waiver request required by this subsection. A recipient
7 may not be required to pay more than $15 of any amount due
8 under this subsection in any one month.
9 Co-payments authorized under this subsection may not be
10 imposed when the care was necessitated by a true medical
11 emergency. Co-payments may not be imposed for any of the
12 following classifications of services:
13 (1) Services furnished to person under 18 years of
14 age.
15 (2) Services furnished to pregnant women.
16 (3) Services furnished to any individual who is an
17 inpatient in a hospital, nursing facility, intermediate
18 care facility, or other medical institution, if that
19 person is required to spend for costs of medical care all
20 but a minimal amount of his or her income required for
21 personal needs.
22 (4) Services furnished to a person who is receiving
23 hospice care.
24 Co-payments authorized under this subsection shall not be
25 deducted from or reduce in any way payments for medical
26 services from the Illinois Department to providers. No
27 provider may deny those services to an individual eligible
28 for services based on the individual's inability to pay the
29 co-payment.
30 Recipients who are subject to co-payments shall be
31 provided notice, in plain and clear language, of the amount
32 of the co-payments, the circumstances under which co-payments
33 are exempted, the circumstances under which co-payments may
34 be assessed, and their manner of collection.
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1 The Illinois Department shall establish a Medicaid
2 Co-Payment Council to assist in the development of co-payment
3 policies for the medical assistance program. The Medicaid
4 Co-Payment Council shall also have jurisdiction to develop a
5 program to provide financial or non-financial incentives to
6 Medicaid recipients in order to encourage recipients to seek
7 necessary health care. The Council shall be chaired by the
8 Director of the Illinois Department, and shall have 6
9 additional members. Two of the 6 additional members shall be
10 appointed by the Governor, and one each shall be appointed by
11 the President of the Senate, the Minority Leader of the
12 Senate, the Speaker of the House of Representatives, and the
13 Minority Leader of the House of Representatives. The Council
14 may be convened and make recommendations upon the appointment
15 of a majority of its members. The Council shall be appointed
16 and convened no later than September 1, 1994 and shall report
17 its recommendations to the Director of the Illinois
18 Department and the General Assembly no later than October 1,
19 1994. The chairperson of the Council shall be allowed to
20 vote only in the case of a tie vote among the appointed
21 members of the Council.
22 The Council shall be guided by the following principles
23 as it considers recommendations to be developed to implement
24 any approved waivers that the Illinois Department must seek
25 pursuant to this subsection:
26 (1) Co-payments should not be used to deter access
27 to adequate medical care.
28 (2) Co-payments should be used to reduce fraud.
29 (3) Co-payment policies should be examined in
30 consideration of other states' experience, and the
31 ability of successful co-payment plans to control
32 unnecessary or inappropriate utilization of services
33 should be promoted.
34 (4) All participants, both recipients and
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1 providers, in the medical assistance program have
2 responsibilities to both the State and the program.
3 (5) Co-payments are primarily a tool to educate the
4 participants in the responsible use of health care
5 resources.
6 (6) Co-payments should not be used to penalize
7 providers.
8 (7) A successful medical program requires the
9 elimination of improper utilization of medical resources.
10 The integrated health care program, or any part of that
11 program, established under this Section may not be
12 implemented if matching federal funds under Title XIX of the
13 Social Security Act are not available for administering the
14 program.
15 The Illinois Department shall submit for publication in
16 the Illinois Register the name, address, and telephone number
17 of the individual to whom a request may be directed for a
18 copy of the request for a waiver of provisions of Title XIX
19 of the Social Security Act that the Illinois Department
20 intends to submit to the Health Care Financing Administration
21 in order to implement this Section. The Illinois Department
22 shall mail a copy of that request for waiver to all
23 requestors at least 16 days before filing that request for
24 waiver with the Health Care Financing Administration.
25 (q) After the effective date of this Section, the
26 Illinois Department may take all planning and preparatory
27 action necessary to implement this Section, including, but
28 not limited to, seeking requests for proposals relating to
29 the integrated health care program created under this
30 Section.
31 (r) In order to (i) accelerate and facilitate the
32 development of integrated health care in contracting areas
33 outside counties with populations in excess of 3,000,000 and
34 counties adjacent to those counties and (ii) maintain and
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1 sustain the high quality of education and residency programs
2 coordinated and associated with local area hospitals, the
3 Illinois Department may develop and implement a demonstration
4 program for managed care community networks owned, operated,
5 or governed by State-funded medical schools. The Illinois
6 Department shall prescribe by rule the criteria, standards,
7 and procedures for effecting this demonstration program.
8 (s) (Blank).
9 (t) On April 1, 1995 and every 6 months thereafter, the
10 Illinois Department shall report to the Governor and General
11 Assembly on the progress of the integrated health care
12 program in enrolling clients into managed health care
13 entities. The report shall indicate the capacities of the
14 managed health care entities with which the State contracts,
15 the number of clients enrolled by each contractor, the areas
16 of the State in which managed care options do not exist, and
17 the progress toward meeting the enrollment goals of the
18 integrated health care program.
19 (u) The Illinois Department may implement this Section
20 through the use of emergency rules in accordance with Section
21 5-45 of the Illinois Administrative Procedure Act. For
22 purposes of that Act, the adoption of rules to implement this
23 Section is deemed an emergency and necessary for the public
24 interest, safety, and welfare.
25 (Source: P.A. 88-554, eff. 7-26-94; 89-21, eff. 7-1-95;
26 89-673, eff. 8-14-96; revised 8-26-96.)
27 (Text of Section after amendment by P.A. 89-507)
28 Sec. 5-16.3. System for integrated health care services.
29 (a) It shall be the public policy of the State to adopt,
30 to the extent practicable, a health care program that
31 encourages the integration of health care services and
32 manages the health care of program enrollees while preserving
33 reasonable choice within a competitive and cost-efficient
34 environment. In furtherance of this public policy, the
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1 Illinois Department shall develop and implement an integrated
2 health care program consistent with the provisions of this
3 Section. The provisions of this Section apply only to the
4 integrated health care program created under this Section.
5 Persons enrolled in the integrated health care program, as
6 determined by the Illinois Department by rule, shall be
7 afforded a choice among health care delivery systems, which
8 shall include, but are not limited to, (i) fee for service
9 care managed by a primary care physician licensed to practice
10 medicine in all its branches, (ii) managed health care
11 entities, and (iii) federally qualified health centers
12 (reimbursed according to a prospective cost-reimbursement
13 methodology) and rural health clinics (reimbursed according
14 to the Medicare methodology), where available. Persons
15 enrolled in the integrated health care program also may be
16 offered indemnity insurance plans, subject to availability.
17 For purposes of this Section, a "managed health care
18 entity" means a health maintenance organization or a managed
19 care community network as defined in this Section. A "health
20 maintenance organization" means a health maintenance
21 organization as defined in the Health Maintenance
22 Organization Act. A "managed care community network" means
23 an entity, other than a health maintenance organization, that
24 is owned, operated, or governed by providers of health care
25 services within this State and that provides or arranges
26 primary, secondary, and tertiary managed health care services
27 under contract with the Illinois Department exclusively to
28 enrollees of the integrated health care program. A managed
29 care community network may contract with the Illinois
30 Department to provide only pediatric health care services. A
31 county provider as defined in Section 15-1 of this Code may
32 contract with the Illinois Department to provide services to
33 enrollees of the integrated health care program as a managed
34 care community network without the need to establish a
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1 separate entity that provides services exclusively to
2 enrollees of the integrated health care program and shall be
3 deemed a managed care community network for purposes of this
4 Code only to the extent of the provision of services to those
5 enrollees in conjunction with the integrated health care
6 program. A county provider shall be entitled to contract
7 with the Illinois Department with respect to any contracting
8 region located in whole or in part within the county. A
9 county provider shall not be required to accept enrollees who
10 do not reside within the county.
11 Each managed care community network must demonstrate its
12 ability to bear the financial risk of serving enrollees under
13 this program. The Illinois Department shall by rule adopt
14 criteria for assessing the financial soundness of each
15 managed care community network. These rules shall consider
16 the extent to which a managed care community network is
17 comprised of providers who directly render health care and
18 are located within the community in which they seek to
19 contract rather than solely arrange or finance the delivery
20 of health care. These rules shall further consider a variety
21 of risk-bearing and management techniques, including the
22 sufficiency of quality assurance and utilization management
23 programs and whether a managed care community network has
24 sufficiently demonstrated its financial solvency and net
25 worth. The Illinois Department's criteria must be based on
26 sound actuarial, financial, and accounting principles. In
27 adopting these rules, the Illinois Department shall consult
28 with the Illinois Department of Insurance. The Illinois
29 Department is responsible for monitoring compliance with
30 these rules.
31 This Section may not be implemented before the effective
32 date of these rules, the approval of any necessary federal
33 waivers, and the completion of the review of an application
34 submitted, at least 60 days before the effective date of
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1 rules adopted under this Section, to the Illinois Department
2 by a managed care community network.
3 All health care delivery systems that contract with the
4 Illinois Department under the integrated health care program
5 shall clearly recognize a health care provider's right of
6 conscience under the Right of Conscience Act. In addition to
7 the provisions of that Act, no health care delivery system
8 that contracts with the Illinois Department under the
9 integrated health care program shall be required to provide,
10 arrange for, or pay for any health care or medical service,
11 procedure, or product if that health care delivery system is
12 owned, controlled, or sponsored by or affiliated with a
13 religious institution or religious organization that finds
14 that health care or medical service, procedure, or product to
15 violate its religious and moral teachings and beliefs.
16 (b) The Illinois Department may, by rule, provide for
17 different benefit packages for different categories of
18 persons enrolled in the program. Mental health services,
19 alcohol and substance abuse services, services related to
20 children with chronic or acute conditions requiring
21 longer-term treatment and follow-up, and rehabilitation care
22 provided by a free-standing rehabilitation hospital or a
23 hospital rehabilitation unit may be excluded from a benefit
24 package if the State ensures that those services are made
25 available through a separate delivery system. An exclusion
26 does not prohibit the Illinois Department from developing and
27 implementing demonstration projects for categories of persons
28 or services. Benefit packages for persons eligible for
29 medical assistance under Articles V, VI, and XII shall be
30 based on the requirements of those Articles and shall be
31 consistent with the Title XIX of the Social Security Act.
32 Nothing in this Act shall be construed to apply to services
33 purchased by the Department of Children and Family Services
34 and the Department of Human Services (as successor to the
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1 Department of Mental Health and Developmental Disabilities)
2 under the provisions of Title 59 of the Illinois
3 Administrative Code, Part 132 ("Medicaid Community Mental
4 Health Services Program").
5 (c) The program established by this Section may be
6 implemented by the Illinois Department in various contracting
7 areas at various times. The health care delivery systems and
8 providers available under the program may vary throughout the
9 State. For purposes of contracting with managed health care
10 entities and providers, the Illinois Department shall
11 establish contracting areas similar to the geographic areas
12 designated by the Illinois Department for contracting
13 purposes under the Illinois Competitive Access and
14 Reimbursement Equity Program (ICARE) under the authority of
15 Section 3-4 of the Illinois Health Finance Reform Act or
16 similarly-sized or smaller geographic areas established by
17 the Illinois Department by rule. A managed health care entity
18 shall be permitted to contract in any geographic areas for
19 which it has a sufficient provider network and otherwise
20 meets the contracting terms of the State. The Illinois
21 Department is not prohibited from entering into a contract
22 with a managed health care entity at any time.
23 (d) A managed health care entity that contracts with the
24 Illinois Department for the provision of services under the
25 program shall do all of the following, solely for purposes of
26 the integrated health care program:
27 (1) Provide that any individual physician licensed
28 to practice medicine in all its branches, any pharmacy,
29 any federally qualified health center, and any
30 podiatrist, that consistently meets the reasonable terms
31 and conditions established by the managed health care
32 entity, including but not limited to credentialing
33 standards, quality assurance program requirements,
34 utilization management requirements, financial
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1 responsibility standards, contracting process
2 requirements, and provider network size and accessibility
3 requirements, must be accepted by the managed health care
4 entity for purposes of the Illinois integrated health
5 care program. Any individual who is either terminated
6 from or denied inclusion in the panel of physicians of
7 the managed health care entity shall be given, within 10
8 business days after that determination, a written
9 explanation of the reasons for his or her exclusion or
10 termination from the panel. This paragraph (1) does not
11 apply to the following:
12 (A) A managed health care entity that
13 certifies to the Illinois Department that:
14 (i) it employs on a full-time basis 125
15 or more Illinois physicians licensed to
16 practice medicine in all of its branches; and
17 (ii) it will provide medical services
18 through its employees to more than 80% of the
19 recipients enrolled with the entity in the
20 integrated health care program; or
21 (B) A domestic stock insurance company
22 licensed under clause (b) of class 1 of Section 4 of
23 the Illinois Insurance Code if (i) at least 66% of
24 the stock of the insurance company is owned by a
25 professional corporation organized under the
26 Professional Service Corporation Act that has 125 or
27 more shareholders who are Illinois physicians
28 licensed to practice medicine in all of its branches
29 and (ii) the insurance company certifies to the
30 Illinois Department that at least 80% of those
31 physician shareholders will provide services to
32 recipients enrolled with the company in the
33 integrated health care program.
34 (2) Provide for reimbursement for providers for
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1 emergency care, as defined by the Illinois Department by
2 rule, that must be provided to its enrollees, including
3 an emergency room screening fee, and urgent care that it
4 authorizes for its enrollees, regardless of the
5 provider's affiliation with the managed health care
6 entity. Providers shall be reimbursed for emergency care
7 at an amount equal to the Illinois Department's
8 fee-for-service rates for those medical services rendered
9 by providers not under contract with the managed health
10 care entity to enrollees of the entity.
11 (3) Provide that any provider affiliated with a
12 managed health care entity may also provide services on a
13 fee-for-service basis to Illinois Department clients not
14 enrolled in a managed health care entity.
15 (4) Provide client education services as determined
16 and approved by the Illinois Department, including but
17 not limited to (i) education regarding appropriate
18 utilization of health care services in a managed care
19 system, (ii) written disclosure of treatment policies and
20 any restrictions or limitations on health services,
21 including, but not limited to, physical services,
22 clinical laboratory tests, hospital and surgical
23 procedures, prescription drugs and biologics, and
24 radiological examinations, and (iii) written notice that
25 the enrollee may receive from another provider those
26 services covered under this program that are not provided
27 by the managed health care entity.
28 (5) Provide that enrollees within its system may
29 choose the site for provision of services and the panel
30 of health care providers.
31 (6) Not discriminate in its enrollment or
32 disenrollment practices among recipients of medical
33 services or program enrollees based on health status.
34 (7) Provide a quality assurance and utilization
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1 review program that (i) for health maintenance
2 organizations meets the requirements of the Health
3 Maintenance Organization Act and (ii) for managed care
4 community networks meets the requirements established by
5 the Illinois Department in rules that incorporate those
6 standards set forth in the Health Maintenance
7 Organization Act.
8 (8) Issue a managed health care entity
9 identification card to each enrollee upon enrollment.
10 The card must contain all of the following:
11 (A) The enrollee's signature.
12 (B) The enrollee's health plan.
13 (C) The name and telephone number of the
14 enrollee's primary care physician.
15 (D) A telephone number to be used for
16 emergency service 24 hours per day, 7 days per week.
17 The telephone number required to be maintained
18 pursuant to this subparagraph by each managed health
19 care entity shall, at minimum, be staffed by
20 medically trained personnel and be provided
21 directly, or under arrangement, at an office or
22 offices in locations maintained solely within the
23 State of Illinois. For purposes of this
24 subparagraph, "medically trained personnel" means
25 licensed practical nurses or registered nurses
26 located in the State of Illinois who are licensed
27 pursuant to the Illinois Nursing Act of 1987.
28 (9) Ensure that every primary care physician and
29 pharmacy in the managed health care entity meets the
30 standards established by the Illinois Department for
31 accessibility and quality of care. The Illinois
32 Department shall arrange for and oversee an evaluation of
33 the standards established under this paragraph (9) and
34 may recommend any necessary changes to these standards.
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1 The Illinois Department shall submit an annual report to
2 the Governor and the General Assembly by April 1 of each
3 year regarding the effect of the standards on ensuring
4 access and quality of care to enrollees.
5 (10) Provide a procedure for handling complaints
6 that (i) for health maintenance organizations meets the
7 requirements of the Health Maintenance Organization Act
8 and (ii) for managed care community networks meets the
9 requirements established by the Illinois Department in
10 rules that incorporate those standards set forth in the
11 Health Maintenance Organization Act.
12 (11) Maintain, retain, and make available to the
13 Illinois Department records, data, and information, in a
14 uniform manner determined by the Illinois Department,
15 sufficient for the Illinois Department to monitor
16 utilization, accessibility, and quality of care.
17 (12) Except for providers who are prepaid, pay all
18 approved claims for covered services that are completed
19 and submitted to the managed health care entity within 30
20 days after receipt of the claim or receipt of the
21 appropriate capitation payment or payments by the managed
22 health care entity from the State for the month in which
23 the services included on the claim were rendered,
24 whichever is later. If payment is not made or mailed to
25 the provider by the managed health care entity by the due
26 date under this subsection, an interest penalty of 1% of
27 any amount unpaid shall be added for each month or
28 fraction of a month after the due date, until final
29 payment is made. Nothing in this Section shall prohibit
30 managed health care entities and providers from mutually
31 agreeing to terms that require more timely payment.
32 (13) Provide integration with community-based
33 programs provided by certified local health departments
34 such as Women, Infants, and Children Supplemental Food
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1 Program (WIC), childhood immunization programs, health
2 education programs, case management programs, and health
3 screening programs.
4 (14) Provide that the pharmacy formulary used by a
5 managed health care entity and its contract providers be
6 no more restrictive than the Illinois Department's
7 pharmaceutical program on the effective date of this
8 amendatory Act of 1994 and as amended after that date.
9 (15) Provide integration with community-based
10 organizations, including, but not limited to, any
11 organization that has operated within a Medicaid
12 Partnership as defined by this Code or by rule of the
13 Illinois Department, that may continue to operate under a
14 contract with the Illinois Department or a managed health
15 care entity under this Section to provide case management
16 services to Medicaid clients in designated high-need
17 areas.
18 The Illinois Department may, by rule, determine
19 methodologies to limit financial liability for managed health
20 care entities resulting from payment for services to
21 enrollees provided under the Illinois Department's integrated
22 health care program. Any methodology so determined may be
23 considered or implemented by the Illinois Department through
24 a contract with a managed health care entity under this
25 integrated health care program.
26 The Illinois Department shall contract with an entity or
27 entities to provide external peer-based quality assurance
28 review for the integrated health care program. The entity
29 shall be representative of Illinois physicians licensed to
30 practice medicine in all its branches and have statewide
31 geographic representation in all specialties of medical care
32 that are provided within the integrated health care program.
33 The entity may not be a third party payer and shall maintain
34 offices in locations around the State in order to provide
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1 service and continuing medical education to physician
2 participants within the integrated health care program. The
3 review process shall be developed and conducted by Illinois
4 physicians licensed to practice medicine in all its branches.
5 In consultation with the entity, the Illinois Department may
6 contract with other entities for professional peer-based
7 quality assurance review of individual categories of services
8 other than services provided, supervised, or coordinated by
9 physicians licensed to practice medicine in all its branches.
10 The Illinois Department shall establish, by rule, criteria to
11 avoid conflicts of interest in the conduct of quality
12 assurance activities consistent with professional peer-review
13 standards. All quality assurance activities shall be
14 coordinated by the Illinois Department.
15 (e) All persons enrolled in the program shall be
16 provided with a full written explanation of all
17 fee-for-service and managed health care plan options and a
18 reasonable opportunity to choose among the options as
19 provided by rule. The Illinois Department shall provide to
20 enrollees, upon enrollment in the integrated health care
21 program and at least annually thereafter, notice of the
22 process for requesting an appeal under the Illinois
23 Department's administrative appeal procedures.
24 Notwithstanding any other Section of this Code, the Illinois
25 Department may provide by rule for the Illinois Department to
26 assign a person enrolled in the program to a specific
27 provider of medical services or to a specific health care
28 delivery system if an enrollee has failed to exercise choice
29 in a timely manner. An enrollee assigned by the Illinois
30 Department shall be afforded the opportunity to disenroll and
31 to select a specific provider of medical services or a
32 specific health care delivery system within the first 30 days
33 after the assignment. An enrollee who has failed to exercise
34 choice in a timely manner may be assigned only if there are 3
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1 or more managed health care entities contracting with the
2 Illinois Department within the contracting area, except that,
3 outside the City of Chicago, this requirement may be waived
4 for an area by rules adopted by the Illinois Department after
5 consultation with all hospitals within the contracting area.
6 The Illinois Department shall establish by rule the procedure
7 for random assignment of enrollees who fail to exercise
8 choice in a timely manner to a specific managed health care
9 entity in proportion to the available capacity of that
10 managed health care entity. Assignment to a specific provider
11 of medical services or to a specific managed health care
12 entity may not exceed that provider's or entity's capacity as
13 determined by the Illinois Department. Any person who has
14 chosen a specific provider of medical services or a specific
15 managed health care entity, or any person who has been
16 assigned under this subsection, shall be given the
17 opportunity to change that choice or assignment at least once
18 every 12 months, as determined by the Illinois Department by
19 rule. The Illinois Department shall maintain a toll-free
20 telephone number for program enrollees' use in reporting
21 problems with managed health care entities.
22 (f) If a person becomes eligible for participation in
23 the integrated health care program while he or she is
24 hospitalized, the Illinois Department may not enroll that
25 person in the program until after he or she has been
26 discharged from the hospital. This subsection does not apply
27 to newborn infants whose mothers are enrolled in the
28 integrated health care program.
29 (g) The Illinois Department shall, by rule, establish
30 for managed health care entities rates that (i) are certified
31 to be actuarially sound, as determined by an actuary who is
32 an associate or a fellow of the Society of Actuaries or a
33 member of the American Academy of Actuaries and who has
34 expertise and experience in medical insurance and benefit
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1 programs, in accordance with the Illinois Department's
2 current fee-for-service payment system, and (ii) take into
3 account any difference of cost to provide health care to
4 different populations based on gender, age, location, and
5 eligibility category. The rates for managed health care
6 entities shall be determined on a capitated basis.
7 The Illinois Department by rule shall establish a method
8 to adjust its payments to managed health care entities in a
9 manner intended to avoid providing any financial incentive to
10 a managed health care entity to refer patients to a county
11 provider, in an Illinois county having a population greater
12 than 3,000,000, that is paid directly by the Illinois
13 Department. The Illinois Department shall by April 1, 1997,
14 and annually thereafter, review the method to adjust
15 payments. Payments by the Illinois Department to the county
16 provider, for persons not enrolled in a managed care
17 community network owned or operated by a county provider,
18 shall be paid on a fee-for-service basis under Article XV of
19 this Code.
20 The Illinois Department by rule shall establish a method
21 to reduce its payments to managed health care entities to
22 take into consideration (i) any adjustment payments paid to
23 hospitals under subsection (h) of this Section to the extent
24 those payments, or any part of those payments, have been
25 taken into account in establishing capitated rates under this
26 subsection (g) and (ii) the implementation of methodologies
27 to limit financial liability for managed health care entities
28 under subsection (d) of this Section.
29 (h) For hospital services provided by a hospital that
30 contracts with a managed health care entity, adjustment
31 payments shall be paid directly to the hospital by the
32 Illinois Department. Adjustment payments may include but
33 need not be limited to adjustment payments to:
34 disproportionate share hospitals under Section 5-5.02 of this
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1 Code; primary care access health care education payments (89
2 Ill. Adm. Code 149.140); payments for capital, direct medical
3 education, indirect medical education, certified registered
4 nurse anesthetist, and kidney acquisition costs (89 Ill. Adm.
5 Code 149.150(c)); uncompensated care payments (89 Ill. Adm.
6 Code 148.150(h)); trauma center payments (89 Ill. Adm. Code
7 148.290(c)); rehabilitation hospital payments (89 Ill. Adm.
8 Code 148.290(d)); perinatal center payments (89 Ill. Adm.
9 Code 148.290(e)); obstetrical care payments (89 Ill. Adm.
10 Code 148.290(f)); targeted access payments (89 Ill. Adm. Code
11 148.290(g)); Medicaid high volume payments (89 Ill. Adm. Code
12 148.290(h)); and outpatient indigent volume adjustments (89
13 Ill. Adm. Code 148.140(b)(5)).
14 (i) For any hospital eligible for the adjustment
15 payments described in subsection (h), the Illinois Department
16 shall maintain, through the period ending June 30, 1995,
17 reimbursement levels in accordance with statutes and rules in
18 effect on April 1, 1994.
19 (j) Nothing contained in this Code in any way limits or
20 otherwise impairs the authority or power of the Illinois
21 Department to enter into a negotiated contract pursuant to
22 this Section with a managed health care entity, including,
23 but not limited to, a health maintenance organization, that
24 provides for termination or nonrenewal of the contract
25 without cause upon notice as provided in the contract and
26 without a hearing.
27 (k) Section 5-5.15 does not apply to the program
28 developed and implemented pursuant to this Section.
29 (l) The Illinois Department shall, by rule, define those
30 chronic or acute medical conditions of childhood that require
31 longer-term treatment and follow-up care. The Illinois
32 Department shall ensure that services required to treat these
33 conditions are available through a separate delivery system.
34 A managed health care entity that contracts with the
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1 Illinois Department may refer a child with medical conditions
2 described in the rules adopted under this subsection directly
3 to a children's hospital or to a hospital, other than a
4 children's hospital, that is qualified to provide inpatient
5 and outpatient services to treat those conditions. The
6 Illinois Department shall provide fee-for-service
7 reimbursement directly to a children's hospital for those
8 services pursuant to Title 89 of the Illinois Administrative
9 Code, Section 148.280(a), at a rate at least equal to the
10 rate in effect on March 31, 1994. For hospitals, other than
11 children's hospitals, that are qualified to provide inpatient
12 and outpatient services to treat those conditions, the
13 Illinois Department shall provide reimbursement for those
14 services on a fee-for-service basis, at a rate at least equal
15 to the rate in effect for those other hospitals on March 31,
16 1994.
17 A children's hospital shall be directly reimbursed for
18 all services provided at the children's hospital on a
19 fee-for-service basis pursuant to Title 89 of the Illinois
20 Administrative Code, Section 148.280(a), at a rate at least
21 equal to the rate in effect on March 31, 1994, until the
22 later of (i) implementation of the integrated health care
23 program under this Section and development of actuarially
24 sound capitation rates for services other than those chronic
25 or acute medical conditions of childhood that require
26 longer-term treatment and follow-up care as defined by the
27 Illinois Department in the rules adopted under this
28 subsection or (ii) March 31, 1996.
29 Notwithstanding anything in this subsection to the
30 contrary, a managed health care entity shall not consider
31 sources or methods of payment in determining the referral of
32 a child. The Illinois Department shall adopt rules to
33 establish criteria for those referrals. The Illinois
34 Department by rule shall establish a method to adjust its
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1 payments to managed health care entities in a manner intended
2 to avoid providing any financial incentive to a managed
3 health care entity to refer patients to a provider who is
4 paid directly by the Illinois Department.
5 (m) Behavioral health services provided or funded by the
6 Department of Human Services, the Department of Children and
7 Family Services, and the Illinois Department shall be
8 excluded from a benefit package. Conditions of an organic or
9 physical origin or nature, including medical detoxification,
10 however, may not be excluded. In this subsection,
11 "behavioral health services" means mental health services and
12 subacute alcohol and substance abuse treatment services, as
13 defined in the Illinois Alcoholism and Other Drug Dependency
14 Act. In this subsection, "mental health services" includes,
15 at a minimum, the following services funded by the Illinois
16 Department, the Department of Human Services (as successor to
17 the Department of Mental Health and Developmental
18 Disabilities), or the Department of Children and Family
19 Services: (i) inpatient hospital services, including related
20 physician services, related psychiatric interventions, and
21 pharmaceutical services provided to an eligible recipient
22 hospitalized with a primary diagnosis of psychiatric
23 disorder; (ii) outpatient mental health services as defined
24 and specified in Title 59 of the Illinois Administrative
25 Code, Part 132; (iii) any other outpatient mental health
26 services funded by the Illinois Department pursuant to the
27 State of Illinois Medicaid Plan; (iv) partial
28 hospitalization; and (v) follow-up stabilization related to
29 any of those services. Additional behavioral health services
30 may be excluded under this subsection as mutually agreed in
31 writing by the Illinois Department and the affected State
32 agency or agencies. The exclusion of any service does not
33 prohibit the Illinois Department from developing and
34 implementing demonstration projects for categories of persons
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1 or services. The Department of Children and Family Services
2 and the Department of Human Services shall each adopt rules
3 governing the integration of managed care in the provision of
4 behavioral health services. The State shall integrate managed
5 care community networks and affiliated providers, to the
6 extent practicable, in any separate delivery system for
7 mental health services.
8 (n) The Illinois Department shall adopt rules to
9 establish reserve requirements for managed care community
10 networks, as required by subsection (a), and health
11 maintenance organizations to protect against liabilities in
12 the event that a managed health care entity is declared
13 insolvent or bankrupt. If a managed health care entity other
14 than a county provider is declared insolvent or bankrupt,
15 after liquidation and application of any available assets,
16 resources, and reserves, the Illinois Department shall pay a
17 portion of the amounts owed by the managed health care entity
18 to providers for services rendered to enrollees under the
19 integrated health care program under this Section based on
20 the following schedule: (i) from April 1, 1995 through June
21 30, 1998, 90% of the amounts owed; (ii) from July 1, 1998
22 through June 30, 2001, 80% of the amounts owed; and (iii)
23 from July 1, 2001 through June 30, 2005, 75% of the amounts
24 owed. The amounts paid under this subsection shall be
25 calculated based on the total amount owed by the managed
26 health care entity to providers before application of any
27 available assets, resources, and reserves. After June 30,
28 2005, the Illinois Department may not pay any amounts owed to
29 providers as a result of an insolvency or bankruptcy of a
30 managed health care entity occurring after that date. The
31 Illinois Department is not obligated, however, to pay amounts
32 owed to a provider that has an ownership or other governing
33 interest in the managed health care entity. This subsection
34 applies only to managed health care entities and the services
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1 they provide under the integrated health care program under
2 this Section.
3 (o) Notwithstanding any other provision of law or
4 contractual agreement to the contrary, providers shall not be
5 required to accept from any other third party payer the rates
6 determined or paid under this Code by the Illinois
7 Department, managed health care entity, or other health care
8 delivery system for services provided to recipients.
9 (p) The Illinois Department may seek and obtain any
10 necessary authorization provided under federal law to
11 implement the program, including the waiver of any federal
12 statutes or regulations. The Illinois Department may seek a
13 waiver of the federal requirement that the combined
14 membership of Medicare and Medicaid enrollees in a managed
15 care community network may not exceed 75% of the managed care
16 community network's total enrollment. The Illinois
17 Department shall not seek a waiver of this requirement for
18 any other category of managed health care entity. The
19 Illinois Department shall not seek a waiver of the inpatient
20 hospital reimbursement methodology in Section 1902(a)(13)(A)
21 of Title XIX of the Social Security Act even if the federal
22 agency responsible for administering Title XIX determines
23 that Section 1902(a)(13)(A) applies to managed health care
24 systems.
25 Notwithstanding any other provisions of this Code to the
26 contrary, the Illinois Department shall seek a waiver of
27 applicable federal law in order to impose a co-payment system
28 consistent with this subsection on recipients of medical
29 services under Title XIX of the Social Security Act who are
30 not enrolled in a managed health care entity. The waiver
31 request submitted by the Illinois Department shall provide
32 for co-payments of up to $0.50 for prescribed drugs and up to
33 $0.50 for x-ray services and shall provide for co-payments of
34 up to $10 for non-emergency services provided in a hospital
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1 emergency room and up to $10 for non-emergency ambulance
2 services. The purpose of the co-payments shall be to deter
3 those recipients from seeking unnecessary medical care.
4 Co-payments may not be used to deter recipients from seeking
5 necessary medical care. No recipient shall be required to
6 pay more than a total of $150 per year in co-payments under
7 the waiver request required by this subsection. A recipient
8 may not be required to pay more than $15 of any amount due
9 under this subsection in any one month.
10 Co-payments authorized under this subsection may not be
11 imposed when the care was necessitated by a true medical
12 emergency. Co-payments may not be imposed for any of the
13 following classifications of services:
14 (1) Services furnished to person under 18 years of
15 age.
16 (2) Services furnished to pregnant women.
17 (3) Services furnished to any individual who is an
18 inpatient in a hospital, nursing facility, intermediate
19 care facility, or other medical institution, if that
20 person is required to spend for costs of medical care all
21 but a minimal amount of his or her income required for
22 personal needs.
23 (4) Services furnished to a person who is receiving
24 hospice care.
25 Co-payments authorized under this subsection shall not be
26 deducted from or reduce in any way payments for medical
27 services from the Illinois Department to providers. No
28 provider may deny those services to an individual eligible
29 for services based on the individual's inability to pay the
30 co-payment.
31 Recipients who are subject to co-payments shall be
32 provided notice, in plain and clear language, of the amount
33 of the co-payments, the circumstances under which co-payments
34 are exempted, the circumstances under which co-payments may
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1 be assessed, and their manner of collection.
2 The Illinois Department shall establish a Medicaid
3 Co-Payment Council to assist in the development of co-payment
4 policies for the medical assistance program. The Medicaid
5 Co-Payment Council shall also have jurisdiction to develop a
6 program to provide financial or non-financial incentives to
7 Medicaid recipients in order to encourage recipients to seek
8 necessary health care. The Council shall be chaired by the
9 Director of the Illinois Department, and shall have 6
10 additional members. Two of the 6 additional members shall be
11 appointed by the Governor, and one each shall be appointed by
12 the President of the Senate, the Minority Leader of the
13 Senate, the Speaker of the House of Representatives, and the
14 Minority Leader of the House of Representatives. The Council
15 may be convened and make recommendations upon the appointment
16 of a majority of its members. The Council shall be appointed
17 and convened no later than September 1, 1994 and shall report
18 its recommendations to the Director of the Illinois
19 Department and the General Assembly no later than October 1,
20 1994. The chairperson of the Council shall be allowed to
21 vote only in the case of a tie vote among the appointed
22 members of the Council.
23 The Council shall be guided by the following principles
24 as it considers recommendations to be developed to implement
25 any approved waivers that the Illinois Department must seek
26 pursuant to this subsection:
27 (1) Co-payments should not be used to deter access
28 to adequate medical care.
29 (2) Co-payments should be used to reduce fraud.
30 (3) Co-payment policies should be examined in
31 consideration of other states' experience, and the
32 ability of successful co-payment plans to control
33 unnecessary or inappropriate utilization of services
34 should be promoted.
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1 (4) All participants, both recipients and
2 providers, in the medical assistance program have
3 responsibilities to both the State and the program.
4 (5) Co-payments are primarily a tool to educate the
5 participants in the responsible use of health care
6 resources.
7 (6) Co-payments should not be used to penalize
8 providers.
9 (7) A successful medical program requires the
10 elimination of improper utilization of medical resources.
11 The integrated health care program, or any part of that
12 program, established under this Section may not be
13 implemented if matching federal funds under Title XIX of the
14 Social Security Act are not available for administering the
15 program.
16 The Illinois Department shall submit for publication in
17 the Illinois Register the name, address, and telephone number
18 of the individual to whom a request may be directed for a
19 copy of the request for a waiver of provisions of Title XIX
20 of the Social Security Act that the Illinois Department
21 intends to submit to the Health Care Financing Administration
22 in order to implement this Section. The Illinois Department
23 shall mail a copy of that request for waiver to all
24 requestors at least 16 days before filing that request for
25 waiver with the Health Care Financing Administration.
26 (q) After the effective date of this Section, the
27 Illinois Department may take all planning and preparatory
28 action necessary to implement this Section, including, but
29 not limited to, seeking requests for proposals relating to
30 the integrated health care program created under this
31 Section.
32 (r) In order to (i) accelerate and facilitate the
33 development of integrated health care in contracting areas
34 outside counties with populations in excess of 3,000,000 and
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1 counties adjacent to those counties and (ii) maintain and
2 sustain the high quality of education and residency programs
3 coordinated and associated with local area hospitals, the
4 Illinois Department may develop and implement a demonstration
5 program for managed care community networks owned, operated,
6 or governed by State-funded medical schools. The Illinois
7 Department shall prescribe by rule the criteria, standards,
8 and procedures for effecting this demonstration program.
9 (s) (Blank).
10 (t) On April 1, 1995 and every 6 months thereafter, the
11 Illinois Department shall report to the Governor and General
12 Assembly on the progress of the integrated health care
13 program in enrolling clients into managed health care
14 entities. The report shall indicate the capacities of the
15 managed health care entities with which the State contracts,
16 the number of clients enrolled by each contractor, the areas
17 of the State in which managed care options do not exist, and
18 the progress toward meeting the enrollment goals of the
19 integrated health care program.
20 (u) The Illinois Department may implement this Section
21 through the use of emergency rules in accordance with Section
22 5-45 of the Illinois Administrative Procedure Act. For
23 purposes of that Act, the adoption of rules to implement this
24 Section is deemed an emergency and necessary for the public
25 interest, safety, and welfare.
26 (Source: P.A. 88-554, eff. 7-26-94; 89-21, eff. 7-1-95;
27 89-507, eff. 7-1-97; 89-673, eff. 8-14-96; revised 8-26-96.)
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
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1 any other Public Act.
2 Section 99. Effective date. This Act takes effect upon
3 becoming law.".