HB3735 99TH GENERAL ASSEMBLY

LRB099 07625 KTG 27756 b

99TH GENERAL ASSEMBLY
State of Illinois
2015 and 2016
HB3735

Introduced , by Rep. Patricia R. Bellock

SYNOPSIS AS INTRODUCED:

New Act

Creates the Medicaid Smart Card Pilot Program Act. Requires the Director of the Department of Healthcare and Family Services to establish a Medicaid Smart Card Pilot Program to reduce the total amount of expenditures under the State's Medical Assistance Program. Provides that the pilot program shall be designed to reduce the average monthly cost under the State's Medical Assistance Program for recipients within the pilot program area by an amount that is at least sufficient to recover the cost of implementing the pilot program. Provides that the Director shall determine the geographic area to be included in the pilot program and may contract with an independent entity for the purpose of developing and implementing the pilot program. Contains provisions on required activities under the pilot program, including the distribution of Medicaid Smart Cards to designated recipients; measures the Department might take to implement the pilot program; annual evaluations; reporting requirements; extension or expansion of the pilot program; the confidentiality of health information; reports to the Inspector General; and rulemaking authority.

FISCAL NOTE ACT MAY APPLY

A BILL FOR

AN ACT concerning public aid.

Be it enacted by the People of the State of Illinois, represented in the General Assembly:

Section 1. Short title. This Act may be cited as the Medicaid Smart Card Pilot Program Act.

Section 5. Definitions. As used in this Act:

"Abuse" means provider practices that are inconsistent with sound fiscal, business, or medical practices and result in unnecessary costs to the State's Medical Assistance Program or in reimbursement for services that are not medically necessary or that fail to meet professionally recognized standards for health care. The term also includes recipient practices that result in unnecessary costs to the State's Medical Assistance Program.

"Director" means the Director of the Department of Healthcare and Family Services.

"Department" means the Department of Healthcare and Family Services.

"Designated recipient" means a recipient who is issued a Medicaid Smart Card.

"Fraud" means an intentional deception or misrepresentation made by any person with the knowledge that the deception could result in some unauthorized benefit to that person or another person, including any act that constitutes fraud under applicable federal or State law.

"Health care facility" means any facility licensed under the Hospital Licensing Act, the Nursing Home Care Act, the ID/DD Community Care Act, the Specialized Mental Health Rehabilitation Act of 2013, or any other laws of this State that is certified to participate in the State's Medical Assistance Program.

"Health care professional" means (i) a person licensed under the Medical Practice Act of 1987, (ii) a person licensed or registered under other laws of this State to provide dental, medical, pharmaceutical, optometric, podiatric, or nursing services, or other remedial care recognized under State law, and (iii) a person licensed under other laws of this State as a clinical social worker.

"Medicaid Smart Card" means a Medicaid eligibility identification card that contains personal health information about the individual to whom it is issued, and which is distributed to designated recipients of medical assistance for use in the pilot program in lieu of the Medical Card issued by the Department to recipients under the State's Medical Assistance Program.

"Medical assistance" means medical assistance benefits provided under the State's Medical Assistance Program pursuant to Article V of the Illinois Public Aid Code.

"Pilot program" means the Medicaid Smart Card Pilot Program established pursuant to this Act.

"Provider" means a health care professional or health care facility providing health care services to a designated recipient.

"Recipient" means a recipient of medical assistance benefits provided under Article V of the Illinois Public Aid Code.

"Transaction" means each occasion on which a designated recipient presents at a provider's premises for the receipt of health care services from that provider.

Section 10. Medicaid Smart Card Pilot Program.

(a) The Director shall establish a Medicaid Smart Card Pilot Program. The objective of the pilot program shall be to reduce the total amount of expenditures under the State's Medical Assistance Program, by reducing the average health care cost per designated recipient, relative to what would be expended in the absence of the pilot program. The pilot program shall be designed to reduce the average monthly cost under the State's Medical Assistance Program for recipients within the pilot program area by an amount that is at least sufficient to recover the cost of implementing the pilot program.

The Director shall determine the geographic area to be included in the pilot program and may contract with an independent entity as the Director determines appropriate for the purpose of developing and implementing the pilot program.

(b) The pilot program shall include the following activities, at a minimum:

(1) enrollment of designated recipients as pilot program participants;

(2) distribution of Medicaid Smart Cards to designated recipients;

(3) authentication of designated recipients at the point of transaction, at the onset and completion of each transaction, in order to prevent card sharing and other forms of abuse or fraud;

(4) denial of ineligible persons at the point of transaction;

(5) authentication of providers at the point of transaction to prevent improper billing practices and other forms of abuse or fraud;

(6) any efforts necessary to secure and protect the personal identity and information of designated recipients.

(c) The Director shall develop such policies and procedures as necessary concerning the distribution and activation of Medicaid Smart Cards for designated recipients and the handling of lost, stolen, or otherwise unavailable Medicaid Smart Cards.

(d) The pilot program may include the use of any of the following:

(1) a secure Internet-based information system for recording and reporting authenticated transactions;

(2) a secure Internet-based information system that interfaces with the appropriate State databases to determine the eligibility of designated recipients;

(3) a system that gathers analytical information to be provided to data-mining companies in order to assist in data-mining processes;

(4) a Medicaid Smart Card with the ability to store multiple recipients' information on one card;

(5) procedures that do not require pre-enrollment of designated recipients; and

(6) an image of the designated recipient stored on both the Medicaid Smart Card and the database with which it is matched.

(e) In implementing the pilot program, the Department may do any of the following:

(1) incorporate additional or alternative methods of authentication of designated recipients;

(2) enter and store billing codes, deductible amounts, and bill confirmations;

(3) allow electronic prescribing services and prescription database integration and tracking in order to prevent medical error through information sharing and to reduce prescription drug abuse and lower health care costs;

(4) implement quick-pay incentives for a provider when an electronic prescribing service, electronic health record, electronic patient record, or computerized patient record used by the provider automatically synchronizes with a designated recipient's Medicaid Smart Card and the provider electronically submits a claim; and

(5) allow elements of the pilot program, including, but not limited to, Medicaid Smart Cards, fingerprint scanners, and card readers, to be adapted for use by other State programs administered by the Department in order to reduce costs associated with the use of multiple electronic benefit cards by a recipient.

(f) The Department shall collaborate with the Secretary of State to ensure that driver's license photographic and other identification data are utilized to reduce the cost of implementing the pilot program to the maximum extent practicable.

(g) The Director shall apply for such State plan amendments or waivers as may be necessary to implement the provisions of this Act and to secure such federal financial participation through the federal Medicaid program as may be available for State expenditures made under this Act.

Section 15. Annual evaluation. The Department shall evaluate the pilot program annually to:

(1) assess the impact of the pilot program on the average monthly health care cost per recipient under the State's Medical Assistance Program, including an assessment of how the health care costs per recipient in geographic areas participating in the pilot program compare to the health care costs per recipient in geographic areas not participating in the pilot program;

(2) distinguish the impact of the pilot program from other demographic, geographic, and health care factors that may affect the average monthly health care costs per recipient under the State's Medical Assistance Program;

(3) quantify the cost savings attributable to the pilot program and identify those strategies necessary to achieve the highest rate of cost savings from the pilot program;

(4) assess variations in the impact of the pilot program on the average monthly health care cost per recipient and the cost savings thereby generated, by provider type, by county, and by other geographic, demographic, or health care characteristics as identified by the Department;

(5) assess the extent to which designated recipients receive health care services outside of the geographic area of the pilot program in order to avoid abuse or fraud detection; and

(6) survey a representative sample of recipients in the geographic area of the pilot program, prior to the start of the pilot program and at least annually thereafter, to collect data about health care services received, the frequency of those services, recipient satisfaction with services used, and recipient satisfaction with the pilot program.

The Department may collect any additional data necessary to evaluate the scope, effectiveness, and impact of the pilot program, including, but not limited to: claims data; other health care data; demographic data; and geographic data.

Section 20. Reports. No later than one year after the effective date of this Act and annually thereafter for such time as the pilot program remains in effect, the Director shall submit a report to the Governor and to the General Assembly on the results of the pilot program with regard to achieving its objective and the results of the annual evaluation conducted pursuant to Section 15. The report may include recommendations for appropriate legislative or administrative action necessary to further the purpose of this Act.

Section 25. Extension or expansion of pilot program. The Director shall not extend the pilot program unless the Director has determined that the pilot program has achieved its objective and shall not expand the pilot program unless the annual evaluation conducted pursuant to Section 15 indicates that the pilot program can be expanded through savings to the State's Medical Assistance Program achieved by the pilot program. The Director's recommendations concerning whether to extend the pilot program or to expand the pilot program to encompass more recipients shall be included in the Director's second annual report pursuant to Section 20. The pilot program shall terminate 2 years after the effective date of this Act unless extended by the Director.

Section 30. Health information; confidentiality.

(a) The provisions of this Act shall not be construed as affecting any person's obligation to comply with the requirements of federal and State law and regulations concerning the privacy of personal health information.

(b) The Director, the Department, and any employee thereof, if acting in good faith, shall not be held responsible for any action of any contractor or subcontractor in the event that the contractor or subcontractor is found to have violated any federal or State law or regulation concerning the privacy of personal health information.

Section 35. Reports to Inspector General; rules.

(a) If the Department has reason to believe that abuse or fraud has been perpetrated in connection with the pilot program, the Department shall refer any such matter to the Inspector General appointed under Section 12-13.1 of the Illinois Public Aid Code.

(b) The Department shall adopt any rules necessary to implement the provisions of this Act.