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90_HB0781
305 ILCS 5/5-16.3
Amends the Medicaid Article of the Public Aid Code. In
the Section concerning the integrated health care program,
provides that if a managed health care entity is accredited
by a national organization, the Department of Public Aid may
give preference to that managed health care entity in
selecting participants for the program. Requires that the
medical director of a managed health care entity be
physician. Effective immediately.
LRB9000971DJcd
LRB9000971DJcd
1 AN ACT to amend the Illinois Public Aid Code by changing
2 Section 5-16.3.
3 Be it enacted by the People of the State of Illinois,
4 represented in the General Assembly:
5 Section 5. The Illinois Public Aid Code is amended by
6 changing Section 5-16.3 as follows:
7 (305 ILCS 5/5-16.3)
8 (Text of Section before amendment by P.A. 89-507)
9 Sec. 5-16.3. System for integrated health care services.
10 (a) It shall be the public policy of the State to adopt,
11 to the extent practicable, a health care program that
12 encourages the integration of health care services and
13 manages the health care of program enrollees while preserving
14 reasonable choice within a competitive and cost-efficient
15 environment. In furtherance of this public policy, the
16 Illinois Department shall develop and implement an integrated
17 health care program consistent with the provisions of this
18 Section. The provisions of this Section apply only to the
19 integrated health care program created under this Section.
20 Persons enrolled in the integrated health care program, as
21 determined by the Illinois Department by rule, shall be
22 afforded a choice among health care delivery systems, which
23 shall include, but are not limited to, (i) fee for service
24 care managed by a primary care physician licensed to practice
25 medicine in all its branches, (ii) managed health care
26 entities, and (iii) federally qualified health centers
27 (reimbursed according to a prospective cost-reimbursement
28 methodology) and rural health clinics (reimbursed according
29 to the Medicare methodology), where available. Persons
30 enrolled in the integrated health care program also may be
31 offered indemnity insurance plans, subject to availability.
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1 For purposes of this Section, a "managed health care
2 entity" means a health maintenance organization or a managed
3 care community network as defined in this Section. A "health
4 maintenance organization" means a health maintenance
5 organization as defined in the Health Maintenance
6 Organization Act. A "managed care community network" means
7 an entity, other than a health maintenance organization, that
8 is owned, operated, or governed by providers of health care
9 services within this State and that provides or arranges
10 primary, secondary, and tertiary managed health care services
11 under contract with the Illinois Department exclusively to
12 enrollees of the integrated health care program. A managed
13 care community network may contract with the Illinois
14 Department to provide only pediatric health care services. A
15 county provider as defined in Section 15-1 of this Code may
16 contract with the Illinois Department to provide services to
17 enrollees of the integrated health care program as a managed
18 care community network without the need to establish a
19 separate entity that provides services exclusively to
20 enrollees of the integrated health care program and shall be
21 deemed a managed care community network for purposes of this
22 Code only to the extent of the provision of services to those
23 enrollees in conjunction with the integrated health care
24 program. A county provider shall be entitled to contract
25 with the Illinois Department with respect to any contracting
26 region located in whole or in part within the county. A
27 county provider shall not be required to accept enrollees who
28 do not reside within the county.
29 If a managed health care entity is accredited by a
30 private national organization that performs quality assurance
31 surveys of health maintenance organizations or related
32 organizations, the Illinois Department may give preference to
33 that managed health care entity in selecting managed health
34 care entities for participation in the integrated health care
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1 program. The medical director of a managed health care entity
2 must be a physician licensed in this State to practice
3 medicine in all its branches.
4 Each managed care community network must demonstrate its
5 ability to bear the financial risk of serving enrollees under
6 this program. The Illinois Department shall by rule adopt
7 criteria for assessing the financial soundness of each
8 managed care community network. These rules shall consider
9 the extent to which a managed care community network is
10 comprised of providers who directly render health care and
11 are located within the community in which they seek to
12 contract rather than solely arrange or finance the delivery
13 of health care. These rules shall further consider a variety
14 of risk-bearing and management techniques, including the
15 sufficiency of quality assurance and utilization management
16 programs and whether a managed care community network has
17 sufficiently demonstrated its financial solvency and net
18 worth. The Illinois Department's criteria must be based on
19 sound actuarial, financial, and accounting principles. In
20 adopting these rules, the Illinois Department shall consult
21 with the Illinois Department of Insurance. The Illinois
22 Department is responsible for monitoring compliance with
23 these rules.
24 This Section may not be implemented before the effective
25 date of these rules, the approval of any necessary federal
26 waivers, and the completion of the review of an application
27 submitted, at least 60 days before the effective date of
28 rules adopted under this Section, to the Illinois Department
29 by a managed care community network.
30 All health care delivery systems that contract with the
31 Illinois Department under the integrated health care program
32 shall clearly recognize a health care provider's right of
33 conscience under the Right of Conscience Act. In addition to
34 the provisions of that Act, no health care delivery system
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1 that contracts with the Illinois Department under the
2 integrated health care program shall be required to provide,
3 arrange for, or pay for any health care or medical service,
4 procedure, or product if that health care delivery system is
5 owned, controlled, or sponsored by or affiliated with a
6 religious institution or religious organization that finds
7 that health care or medical service, procedure, or product to
8 violate its religious and moral teachings and beliefs.
9 (b) The Illinois Department may, by rule, provide for
10 different benefit packages for different categories of
11 persons enrolled in the program. Mental health services,
12 alcohol and substance abuse services, services related to
13 children with chronic or acute conditions requiring
14 longer-term treatment and follow-up, and rehabilitation care
15 provided by a free-standing rehabilitation hospital or a
16 hospital rehabilitation unit may be excluded from a benefit
17 package if the State ensures that those services are made
18 available through a separate delivery system. An exclusion
19 does not prohibit the Illinois Department from developing and
20 implementing demonstration projects for categories of persons
21 or services. Benefit packages for persons eligible for
22 medical assistance under Articles V, VI, and XII shall be
23 based on the requirements of those Articles and shall be
24 consistent with the Title XIX of the Social Security Act.
25 Nothing in this Act shall be construed to apply to services
26 purchased by the Department of Children and Family Services
27 and the Department of Mental Health and Developmental
28 Disabilities under the provisions of Title 59 of the Illinois
29 Administrative Code, Part 132 ("Medicaid Community Mental
30 Health Services Program").
31 (c) The program established by this Section may be
32 implemented by the Illinois Department in various contracting
33 areas at various times. The health care delivery systems and
34 providers available under the program may vary throughout the
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1 State. For purposes of contracting with managed health care
2 entities and providers, the Illinois Department shall
3 establish contracting areas similar to the geographic areas
4 designated by the Illinois Department for contracting
5 purposes under the Illinois Competitive Access and
6 Reimbursement Equity Program (ICARE) under the authority of
7 Section 3-4 of the Illinois Health Finance Reform Act or
8 similarly-sized or smaller geographic areas established by
9 the Illinois Department by rule. A managed health care entity
10 shall be permitted to contract in any geographic areas for
11 which it has a sufficient provider network and otherwise
12 meets the contracting terms of the State. The Illinois
13 Department is not prohibited from entering into a contract
14 with a managed health care entity at any time.
15 (d) A managed health care entity that contracts with the
16 Illinois Department for the provision of services under the
17 program shall do all of the following, solely for purposes of
18 the integrated health care program:
19 (1) Provide that any individual physician licensed
20 to practice medicine in all its branches, any pharmacy,
21 any federally qualified health center, and any
22 podiatrist, that consistently meets the reasonable terms
23 and conditions established by the managed health care
24 entity, including but not limited to credentialing
25 standards, quality assurance program requirements,
26 utilization management requirements, financial
27 responsibility standards, contracting process
28 requirements, and provider network size and accessibility
29 requirements, must be accepted by the managed health care
30 entity for purposes of the Illinois integrated health
31 care program. Any individual who is either terminated
32 from or denied inclusion in the panel of physicians of
33 the managed health care entity shall be given, within 10
34 business days after that determination, a written
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1 explanation of the reasons for his or her exclusion or
2 termination from the panel. This paragraph (1) does not
3 apply to the following:
4 (A) A managed health care entity that
5 certifies to the Illinois Department that:
6 (i) it employs on a full-time basis 125
7 or more Illinois physicians licensed to
8 practice medicine in all of its branches; and
9 (ii) it will provide medical services
10 through its employees to more than 80% of the
11 recipients enrolled with the entity in the
12 integrated health care program; or
13 (B) A domestic stock insurance company
14 licensed under clause (b) of class 1 of Section 4 of
15 the Illinois Insurance Code if (i) at least 66% of
16 the stock of the insurance company is owned by a
17 professional corporation organized under the
18 Professional Service Corporation Act that has 125 or
19 more shareholders who are Illinois physicians
20 licensed to practice medicine in all of its branches
21 and (ii) the insurance company certifies to the
22 Illinois Department that at least 80% of those
23 physician shareholders will provide services to
24 recipients enrolled with the company in the
25 integrated health care program.
26 (2) Provide for reimbursement for providers for
27 emergency care, as defined by the Illinois Department by
28 rule, that must be provided to its enrollees, including
29 an emergency room screening fee, and urgent care that it
30 authorizes for its enrollees, regardless of the
31 provider's affiliation with the managed health care
32 entity. Providers shall be reimbursed for emergency care
33 at an amount equal to the Illinois Department's
34 fee-for-service rates for those medical services rendered
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1 by providers not under contract with the managed health
2 care entity to enrollees of the entity.
3 (3) Provide that any provider affiliated with a
4 managed health care entity may also provide services on a
5 fee-for-service basis to Illinois Department clients not
6 enrolled in a managed health care entity.
7 (4) Provide client education services as determined
8 and approved by the Illinois Department, including but
9 not limited to (i) education regarding appropriate
10 utilization of health care services in a managed care
11 system, (ii) written disclosure of treatment policies and
12 any restrictions or limitations on health services,
13 including, but not limited to, physical services,
14 clinical laboratory tests, hospital and surgical
15 procedures, prescription drugs and biologics, and
16 radiological examinations, and (iii) written notice that
17 the enrollee may receive from another provider those
18 services covered under this program that are not provided
19 by the managed health care entity.
20 (5) Provide that enrollees within its system may
21 choose the site for provision of services and the panel
22 of health care providers.
23 (6) Not discriminate in its enrollment or
24 disenrollment practices among recipients of medical
25 services or program enrollees based on health status.
26 (7) Provide a quality assurance and utilization
27 review program that (i) for health maintenance
28 organizations meets the requirements of the Health
29 Maintenance Organization Act and (ii) for managed care
30 community networks meets the requirements established by
31 the Illinois Department in rules that incorporate those
32 standards set forth in the Health Maintenance
33 Organization Act.
34 (8) Issue a managed health care entity
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1 identification card to each enrollee upon enrollment.
2 The card must contain all of the following:
3 (A) The enrollee's signature.
4 (B) The enrollee's health plan.
5 (C) The name and telephone number of the
6 enrollee's primary care physician.
7 (D) A telephone number to be used for
8 emergency service 24 hours per day, 7 days per week.
9 The telephone number required to be maintained
10 pursuant to this subparagraph by each managed health
11 care entity shall, at minimum, be staffed by
12 medically trained personnel and be provided
13 directly, or under arrangement, at an office or
14 offices in locations maintained solely within the
15 State of Illinois. For purposes of this
16 subparagraph, "medically trained personnel" means
17 licensed practical nurses or registered nurses
18 located in the State of Illinois who are licensed
19 pursuant to the Illinois Nursing Act of 1987.
20 (9) Ensure that every primary care physician and
21 pharmacy in the managed health care entity meets the
22 standards established by the Illinois Department for
23 accessibility and quality of care. The Illinois
24 Department shall arrange for and oversee an evaluation of
25 the standards established under this paragraph (9) and
26 may recommend any necessary changes to these standards.
27 The Illinois Department shall submit an annual report to
28 the Governor and the General Assembly by April 1 of each
29 year regarding the effect of the standards on ensuring
30 access and quality of care to enrollees.
31 (10) Provide a procedure for handling complaints
32 that (i) for health maintenance organizations meets the
33 requirements of the Health Maintenance Organization Act
34 and (ii) for managed care community networks meets the
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1 requirements established by the Illinois Department in
2 rules that incorporate those standards set forth in the
3 Health Maintenance Organization Act.
4 (11) Maintain, retain, and make available to the
5 Illinois Department records, data, and information, in a
6 uniform manner determined by the Illinois Department,
7 sufficient for the Illinois Department to monitor
8 utilization, accessibility, and quality of care.
9 (12) Except for providers who are prepaid, pay all
10 approved claims for covered services that are completed
11 and submitted to the managed health care entity within 30
12 days after receipt of the claim or receipt of the
13 appropriate capitation payment or payments by the managed
14 health care entity from the State for the month in which
15 the services included on the claim were rendered,
16 whichever is later. If payment is not made or mailed to
17 the provider by the managed health care entity by the due
18 date under this subsection, an interest penalty of 1% of
19 any amount unpaid shall be added for each month or
20 fraction of a month after the due date, until final
21 payment is made. Nothing in this Section shall prohibit
22 managed health care entities and providers from mutually
23 agreeing to terms that require more timely payment.
24 (13) Provide integration with community-based
25 programs provided by certified local health departments
26 such as Women, Infants, and Children Supplemental Food
27 Program (WIC), childhood immunization programs, health
28 education programs, case management programs, and health
29 screening programs.
30 (14) Provide that the pharmacy formulary used by a
31 managed health care entity and its contract providers be
32 no more restrictive than the Illinois Department's
33 pharmaceutical program on the effective date of this
34 amendatory Act of 1994 and as amended after that date.
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1 (15) Provide integration with community-based
2 organizations, including, but not limited to, any
3 organization that has operated within a Medicaid
4 Partnership as defined by this Code or by rule of the
5 Illinois Department, that may continue to operate under a
6 contract with the Illinois Department or a managed health
7 care entity under this Section to provide case management
8 services to Medicaid clients in designated high-need
9 areas.
10 The Illinois Department may, by rule, determine
11 methodologies to limit financial liability for managed health
12 care entities resulting from payment for services to
13 enrollees provided under the Illinois Department's integrated
14 health care program. Any methodology so determined may be
15 considered or implemented by the Illinois Department through
16 a contract with a managed health care entity under this
17 integrated health care program.
18 The Illinois Department shall contract with an entity or
19 entities to provide external peer-based quality assurance
20 review for the integrated health care program. The entity
21 shall be representative of Illinois physicians licensed to
22 practice medicine in all its branches and have statewide
23 geographic representation in all specialties of medical care
24 that are provided within the integrated health care program.
25 The entity may not be a third party payer and shall maintain
26 offices in locations around the State in order to provide
27 service and continuing medical education to physician
28 participants within the integrated health care program. The
29 review process shall be developed and conducted by Illinois
30 physicians licensed to practice medicine in all its branches.
31 In consultation with the entity, the Illinois Department may
32 contract with other entities for professional peer-based
33 quality assurance review of individual categories of services
34 other than services provided, supervised, or coordinated by
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1 physicians licensed to practice medicine in all its branches.
2 The Illinois Department shall establish, by rule, criteria to
3 avoid conflicts of interest in the conduct of quality
4 assurance activities consistent with professional peer-review
5 standards. All quality assurance activities shall be
6 coordinated by the Illinois Department.
7 (e) All persons enrolled in the program shall be
8 provided with a full written explanation of all
9 fee-for-service and managed health care plan options and a
10 reasonable opportunity to choose among the options as
11 provided by rule. The Illinois Department shall provide to
12 enrollees, upon enrollment in the integrated health care
13 program and at least annually thereafter, notice of the
14 process for requesting an appeal under the Illinois
15 Department's administrative appeal procedures.
16 Notwithstanding any other Section of this Code, the Illinois
17 Department may provide by rule for the Illinois Department to
18 assign a person enrolled in the program to a specific
19 provider of medical services or to a specific health care
20 delivery system if an enrollee has failed to exercise choice
21 in a timely manner. An enrollee assigned by the Illinois
22 Department shall be afforded the opportunity to disenroll and
23 to select a specific provider of medical services or a
24 specific health care delivery system within the first 30 days
25 after the assignment. An enrollee who has failed to exercise
26 choice in a timely manner may be assigned only if there are 3
27 or more managed health care entities contracting with the
28 Illinois Department within the contracting area, except that,
29 outside the City of Chicago, this requirement may be waived
30 for an area by rules adopted by the Illinois Department after
31 consultation with all hospitals within the contracting area.
32 The Illinois Department shall establish by rule the procedure
33 for random assignment of enrollees who fail to exercise
34 choice in a timely manner to a specific managed health care
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1 entity in proportion to the available capacity of that
2 managed health care entity. Assignment to a specific provider
3 of medical services or to a specific managed health care
4 entity may not exceed that provider's or entity's capacity as
5 determined by the Illinois Department. Any person who has
6 chosen a specific provider of medical services or a specific
7 managed health care entity, or any person who has been
8 assigned under this subsection, shall be given the
9 opportunity to change that choice or assignment at least once
10 every 12 months, as determined by the Illinois Department by
11 rule. The Illinois Department shall maintain a toll-free
12 telephone number for program enrollees' use in reporting
13 problems with managed health care entities.
14 (f) If a person becomes eligible for participation in
15 the integrated health care program while he or she is
16 hospitalized, the Illinois Department may not enroll that
17 person in the program until after he or she has been
18 discharged from the hospital. This subsection does not apply
19 to newborn infants whose mothers are enrolled in the
20 integrated health care program.
21 (g) The Illinois Department shall, by rule, establish
22 for managed health care entities rates that (i) are certified
23 to be actuarially sound, as determined by an actuary who is
24 an associate or a fellow of the Society of Actuaries or a
25 member of the American Academy of Actuaries and who has
26 expertise and experience in medical insurance and benefit
27 programs, in accordance with the Illinois Department's
28 current fee-for-service payment system, and (ii) take into
29 account any difference of cost to provide health care to
30 different populations based on gender, age, location, and
31 eligibility category. The rates for managed health care
32 entities shall be determined on a capitated basis.
33 The Illinois Department by rule shall establish a method
34 to adjust its payments to managed health care entities in a
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1 manner intended to avoid providing any financial incentive to
2 a managed health care entity to refer patients to a county
3 provider, in an Illinois county having a population greater
4 than 3,000,000, that is paid directly by the Illinois
5 Department. The Illinois Department shall by April 1, 1997,
6 and annually thereafter, review the method to adjust
7 payments. Payments by the Illinois Department to the county
8 provider, for persons not enrolled in a managed care
9 community network owned or operated by a county provider,
10 shall be paid on a fee-for-service basis under Article XV of
11 this Code.
12 The Illinois Department by rule shall establish a method
13 to reduce its payments to managed health care entities to
14 take into consideration (i) any adjustment payments paid to
15 hospitals under subsection (h) of this Section to the extent
16 those payments, or any part of those payments, have been
17 taken into account in establishing capitated rates under this
18 subsection (g) and (ii) the implementation of methodologies
19 to limit financial liability for managed health care entities
20 under subsection (d) of this Section.
21 (h) For hospital services provided by a hospital that
22 contracts with a managed health care entity, adjustment
23 payments shall be paid directly to the hospital by the
24 Illinois Department. Adjustment payments may include but
25 need not be limited to adjustment payments to:
26 disproportionate share hospitals under Section 5-5.02 of this
27 Code; primary care access health care education payments (89
28 Ill. Adm. Code 149.140); payments for capital, direct medical
29 education, indirect medical education, certified registered
30 nurse anesthetist, and kidney acquisition costs (89 Ill. Adm.
31 Code 149.150(c)); uncompensated care payments (89 Ill. Adm.
32 Code 148.150(h)); trauma center payments (89 Ill. Adm. Code
33 148.290(c)); rehabilitation hospital payments (89 Ill. Adm.
34 Code 148.290(d)); perinatal center payments (89 Ill. Adm.
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1 Code 148.290(e)); obstetrical care payments (89 Ill. Adm.
2 Code 148.290(f)); targeted access payments (89 Ill. Adm. Code
3 148.290(g)); Medicaid high volume payments (89 Ill. Adm. Code
4 148.290(h)); and outpatient indigent volume adjustments (89
5 Ill. Adm. Code 148.140(b)(5)).
6 (i) For any hospital eligible for the adjustment
7 payments described in subsection (h), the Illinois Department
8 shall maintain, through the period ending June 30, 1995,
9 reimbursement levels in accordance with statutes and rules in
10 effect on April 1, 1994.
11 (j) Nothing contained in this Code in any way limits or
12 otherwise impairs the authority or power of the Illinois
13 Department to enter into a negotiated contract pursuant to
14 this Section with a managed health care entity, including,
15 but not limited to, a health maintenance organization, that
16 provides for termination or nonrenewal of the contract
17 without cause upon notice as provided in the contract and
18 without a hearing.
19 (k) Section 5-5.15 does not apply to the program
20 developed and implemented pursuant to this Section.
21 (l) The Illinois Department shall, by rule, define those
22 chronic or acute medical conditions of childhood that require
23 longer-term treatment and follow-up care. The Illinois
24 Department shall ensure that services required to treat these
25 conditions are available through a separate delivery system.
26 A managed health care entity that contracts with the
27 Illinois Department may refer a child with medical conditions
28 described in the rules adopted under this subsection directly
29 to a children's hospital or to a hospital, other than a
30 children's hospital, that is qualified to provide inpatient
31 and outpatient services to treat those conditions. The
32 Illinois Department shall provide fee-for-service
33 reimbursement directly to a children's hospital for those
34 services pursuant to Title 89 of the Illinois Administrative
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1 Code, Section 148.280(a), at a rate at least equal to the
2 rate in effect on March 31, 1994. For hospitals, other than
3 children's hospitals, that are qualified to provide inpatient
4 and outpatient services to treat those conditions, the
5 Illinois Department shall provide reimbursement for those
6 services on a fee-for-service basis, at a rate at least equal
7 to the rate in effect for those other hospitals on March 31,
8 1994.
9 A children's hospital shall be directly reimbursed for
10 all services provided at the children's hospital on a
11 fee-for-service basis pursuant to Title 89 of the Illinois
12 Administrative Code, Section 148.280(a), at a rate at least
13 equal to the rate in effect on March 31, 1994, until the
14 later of (i) implementation of the integrated health care
15 program under this Section and development of actuarially
16 sound capitation rates for services other than those chronic
17 or acute medical conditions of childhood that require
18 longer-term treatment and follow-up care as defined by the
19 Illinois Department in the rules adopted under this
20 subsection or (ii) March 31, 1996.
21 Notwithstanding anything in this subsection to the
22 contrary, a managed health care entity shall not consider
23 sources or methods of payment in determining the referral of
24 a child. The Illinois Department shall adopt rules to
25 establish criteria for those referrals. The Illinois
26 Department by rule shall establish a method to adjust its
27 payments to managed health care entities in a manner intended
28 to avoid providing any financial incentive to a managed
29 health care entity to refer patients to a provider who is
30 paid directly by the Illinois Department.
31 (m) Behavioral health services provided or funded by the
32 Department of Mental Health and Developmental Disabilities,
33 the Department of Alcoholism and Substance Abuse, the
34 Department of Children and Family Services, and the Illinois
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1 Department shall be excluded from a benefit package.
2 Conditions of an organic or physical origin or nature,
3 including medical detoxification, however, may not be
4 excluded. In this subsection, "behavioral health services"
5 means mental health services and subacute alcohol and
6 substance abuse treatment services, as defined in the
7 Illinois Alcoholism and Other Drug Dependency Act. In this
8 subsection, "mental health services" includes, at a minimum,
9 the following services funded by the Illinois Department, the
10 Department of Mental Health and Developmental Disabilities,
11 or the Department of Children and Family Services: (i)
12 inpatient hospital services, including related physician
13 services, related psychiatric interventions, and
14 pharmaceutical services provided to an eligible recipient
15 hospitalized with a primary diagnosis of psychiatric
16 disorder; (ii) outpatient mental health services as defined
17 and specified in Title 59 of the Illinois Administrative
18 Code, Part 132; (iii) any other outpatient mental health
19 services funded by the Illinois Department pursuant to the
20 State of Illinois Medicaid Plan; (iv) partial
21 hospitalization; and (v) follow-up stabilization related to
22 any of those services. Additional behavioral health services
23 may be excluded under this subsection as mutually agreed in
24 writing by the Illinois Department and the affected State
25 agency or agencies. The exclusion of any service does not
26 prohibit the Illinois Department from developing and
27 implementing demonstration projects for categories of persons
28 or services. The Department of Mental Health and
29 Developmental Disabilities, the Department of Children and
30 Family Services, and the Department of Alcoholism and
31 Substance Abuse shall each adopt rules governing the
32 integration of managed care in the provision of behavioral
33 health services. The State shall integrate managed care
34 community networks and affiliated providers, to the extent
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1 practicable, in any separate delivery system for mental
2 health services.
3 (n) The Illinois Department shall adopt rules to
4 establish reserve requirements for managed care community
5 networks, as required by subsection (a), and health
6 maintenance organizations to protect against liabilities in
7 the event that a managed health care entity is declared
8 insolvent or bankrupt. If a managed health care entity other
9 than a county provider is declared insolvent or bankrupt,
10 after liquidation and application of any available assets,
11 resources, and reserves, the Illinois Department shall pay a
12 portion of the amounts owed by the managed health care entity
13 to providers for services rendered to enrollees under the
14 integrated health care program under this Section based on
15 the following schedule: (i) from April 1, 1995 through June
16 30, 1998, 90% of the amounts owed; (ii) from July 1, 1998
17 through June 30, 2001, 80% of the amounts owed; and (iii)
18 from July 1, 2001 through June 30, 2005, 75% of the amounts
19 owed. The amounts paid under this subsection shall be
20 calculated based on the total amount owed by the managed
21 health care entity to providers before application of any
22 available assets, resources, and reserves. After June 30,
23 2005, the Illinois Department may not pay any amounts owed to
24 providers as a result of an insolvency or bankruptcy of a
25 managed health care entity occurring after that date. The
26 Illinois Department is not obligated, however, to pay amounts
27 owed to a provider that has an ownership or other governing
28 interest in the managed health care entity. This subsection
29 applies only to managed health care entities and the services
30 they provide under the integrated health care program under
31 this Section.
32 (o) Notwithstanding any other provision of law or
33 contractual agreement to the contrary, providers shall not be
34 required to accept from any other third party payer the rates
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1 determined or paid under this Code by the Illinois
2 Department, managed health care entity, or other health care
3 delivery system for services provided to recipients.
4 (p) The Illinois Department may seek and obtain any
5 necessary authorization provided under federal law to
6 implement the program, including the waiver of any federal
7 statutes or regulations. The Illinois Department may seek a
8 waiver of the federal requirement that the combined
9 membership of Medicare and Medicaid enrollees in a managed
10 care community network may not exceed 75% of the managed care
11 community network's total enrollment. The Illinois
12 Department shall not seek a waiver of this requirement for
13 any other category of managed health care entity. The
14 Illinois Department shall not seek a waiver of the inpatient
15 hospital reimbursement methodology in Section 1902(a)(13)(A)
16 of Title XIX of the Social Security Act even if the federal
17 agency responsible for administering Title XIX determines
18 that Section 1902(a)(13)(A) applies to managed health care
19 systems.
20 Notwithstanding any other provisions of this Code to the
21 contrary, the Illinois Department shall seek a waiver of
22 applicable federal law in order to impose a co-payment system
23 consistent with this subsection on recipients of medical
24 services under Title XIX of the Social Security Act who are
25 not enrolled in a managed health care entity. The waiver
26 request submitted by the Illinois Department shall provide
27 for co-payments of up to $0.50 for prescribed drugs and up to
28 $0.50 for x-ray services and shall provide for co-payments of
29 up to $10 for non-emergency services provided in a hospital
30 emergency room and up to $10 for non-emergency ambulance
31 services. The purpose of the co-payments shall be to deter
32 those recipients from seeking unnecessary medical care.
33 Co-payments may not be used to deter recipients from seeking
34 necessary medical care. No recipient shall be required to
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1 pay more than a total of $150 per year in co-payments under
2 the waiver request required by this subsection. A recipient
3 may not be required to pay more than $15 of any amount due
4 under this subsection in any one month.
5 Co-payments authorized under this subsection may not be
6 imposed when the care was necessitated by a true medical
7 emergency. Co-payments may not be imposed for any of the
8 following classifications of services:
9 (1) Services furnished to person under 18 years of
10 age.
11 (2) Services furnished to pregnant women.
12 (3) Services furnished to any individual who is an
13 inpatient in a hospital, nursing facility, intermediate
14 care facility, or other medical institution, if that
15 person is required to spend for costs of medical care all
16 but a minimal amount of his or her income required for
17 personal needs.
18 (4) Services furnished to a person who is receiving
19 hospice care.
20 Co-payments authorized under this subsection shall not be
21 deducted from or reduce in any way payments for medical
22 services from the Illinois Department to providers. No
23 provider may deny those services to an individual eligible
24 for services based on the individual's inability to pay the
25 co-payment.
26 Recipients who are subject to co-payments shall be
27 provided notice, in plain and clear language, of the amount
28 of the co-payments, the circumstances under which co-payments
29 are exempted, the circumstances under which co-payments may
30 be assessed, and their manner of collection.
31 The Illinois Department shall establish a Medicaid
32 Co-Payment Council to assist in the development of co-payment
33 policies for the medical assistance program. The Medicaid
34 Co-Payment Council shall also have jurisdiction to develop a
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1 program to provide financial or non-financial incentives to
2 Medicaid recipients in order to encourage recipients to seek
3 necessary health care. The Council shall be chaired by the
4 Director of the Illinois Department, and shall have 6
5 additional members. Two of the 6 additional members shall be
6 appointed by the Governor, and one each shall be appointed by
7 the President of the Senate, the Minority Leader of the
8 Senate, the Speaker of the House of Representatives, and the
9 Minority Leader of the House of Representatives. The Council
10 may be convened and make recommendations upon the appointment
11 of a majority of its members. The Council shall be appointed
12 and convened no later than September 1, 1994 and shall report
13 its recommendations to the Director of the Illinois
14 Department and the General Assembly no later than October 1,
15 1994. The chairperson of the Council shall be allowed to
16 vote only in the case of a tie vote among the appointed
17 members of the Council.
18 The Council shall be guided by the following principles
19 as it considers recommendations to be developed to implement
20 any approved waivers that the Illinois Department must seek
21 pursuant to this subsection:
22 (1) Co-payments should not be used to deter access
23 to adequate medical care.
24 (2) Co-payments should be used to reduce fraud.
25 (3) Co-payment policies should be examined in
26 consideration of other states' experience, and the
27 ability of successful co-payment plans to control
28 unnecessary or inappropriate utilization of services
29 should be promoted.
30 (4) All participants, both recipients and
31 providers, in the medical assistance program have
32 responsibilities to both the State and the program.
33 (5) Co-payments are primarily a tool to educate the
34 participants in the responsible use of health care
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1 resources.
2 (6) Co-payments should not be used to penalize
3 providers.
4 (7) A successful medical program requires the
5 elimination of improper utilization of medical resources.
6 The integrated health care program, or any part of that
7 program, established under this Section may not be
8 implemented if matching federal funds under Title XIX of the
9 Social Security Act are not available for administering the
10 program.
11 The Illinois Department shall submit for publication in
12 the Illinois Register the name, address, and telephone number
13 of the individual to whom a request may be directed for a
14 copy of the request for a waiver of provisions of Title XIX
15 of the Social Security Act that the Illinois Department
16 intends to submit to the Health Care Financing Administration
17 in order to implement this Section. The Illinois Department
18 shall mail a copy of that request for waiver to all
19 requestors at least 16 days before filing that request for
20 waiver with the Health Care Financing Administration.
21 (q) After the effective date of this Section, the
22 Illinois Department may take all planning and preparatory
23 action necessary to implement this Section, including, but
24 not limited to, seeking requests for proposals relating to
25 the integrated health care program created under this
26 Section.
27 (r) In order to (i) accelerate and facilitate the
28 development of integrated health care in contracting areas
29 outside counties with populations in excess of 3,000,000 and
30 counties adjacent to those counties and (ii) maintain and
31 sustain the high quality of education and residency programs
32 coordinated and associated with local area hospitals, the
33 Illinois Department may develop and implement a demonstration
34 program for managed care community networks owned, operated,
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1 or governed by State-funded medical schools. The Illinois
2 Department shall prescribe by rule the criteria, standards,
3 and procedures for effecting this demonstration program.
4 (s) (Blank).
5 (t) On April 1, 1995 and every 6 months thereafter, the
6 Illinois Department shall report to the Governor and General
7 Assembly on the progress of the integrated health care
8 program in enrolling clients into managed health care
9 entities. The report shall indicate the capacities of the
10 managed health care entities with which the State contracts,
11 the number of clients enrolled by each contractor, the areas
12 of the State in which managed care options do not exist, and
13 the progress toward meeting the enrollment goals of the
14 integrated health care program.
15 (u) The Illinois Department may implement this Section
16 through the use of emergency rules in accordance with Section
17 5-45 of the Illinois Administrative Procedure Act. For
18 purposes of that Act, the adoption of rules to implement this
19 Section is deemed an emergency and necessary for the public
20 interest, safety, and welfare.
21 (Source: P.A. 88-554, eff. 7-26-94; 89-21, eff. 7-1-95;
22 89-673, eff. 8-14-96; revised 8-26-96.)
23 (Text of Section after amendment by P.A. 89-507)
24 Sec. 5-16.3. System for integrated health care services.
25 (a) It shall be the public policy of the State to adopt,
26 to the extent practicable, a health care program that
27 encourages the integration of health care services and
28 manages the health care of program enrollees while preserving
29 reasonable choice within a competitive and cost-efficient
30 environment. In furtherance of this public policy, the
31 Illinois Department shall develop and implement an integrated
32 health care program consistent with the provisions of this
33 Section. The provisions of this Section apply only to the
34 integrated health care program created under this Section.
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1 Persons enrolled in the integrated health care program, as
2 determined by the Illinois Department by rule, shall be
3 afforded a choice among health care delivery systems, which
4 shall include, but are not limited to, (i) fee for service
5 care managed by a primary care physician licensed to practice
6 medicine in all its branches, (ii) managed health care
7 entities, and (iii) federally qualified health centers
8 (reimbursed according to a prospective cost-reimbursement
9 methodology) and rural health clinics (reimbursed according
10 to the Medicare methodology), where available. Persons
11 enrolled in the integrated health care program also may be
12 offered indemnity insurance plans, subject to availability.
13 For purposes of this Section, a "managed health care
14 entity" means a health maintenance organization or a managed
15 care community network as defined in this Section. A "health
16 maintenance organization" means a health maintenance
17 organization as defined in the Health Maintenance
18 Organization Act. A "managed care community network" means
19 an entity, other than a health maintenance organization, that
20 is owned, operated, or governed by providers of health care
21 services within this State and that provides or arranges
22 primary, secondary, and tertiary managed health care services
23 under contract with the Illinois Department exclusively to
24 enrollees of the integrated health care program. A managed
25 care community network may contract with the Illinois
26 Department to provide only pediatric health care services. A
27 county provider as defined in Section 15-1 of this Code may
28 contract with the Illinois Department to provide services to
29 enrollees of the integrated health care program as a managed
30 care community network without the need to establish a
31 separate entity that provides services exclusively to
32 enrollees of the integrated health care program and shall be
33 deemed a managed care community network for purposes of this
34 Code only to the extent of the provision of services to those
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1 enrollees in conjunction with the integrated health care
2 program. A county provider shall be entitled to contract
3 with the Illinois Department with respect to any contracting
4 region located in whole or in part within the county. A
5 county provider shall not be required to accept enrollees who
6 do not reside within the county.
7 If a managed health care entity is accredited by a
8 private national organization that performs quality assurance
9 surveys of health maintenance organizations or related
10 organizations, the Illinois Department may give preference to
11 that managed health care entity in selecting managed health
12 care entities for participation in the integrated health care
13 program. The medical director of a managed health care entity
14 must be a physician licensed in this State to practice
15 medicine in all its branches.
16 Each managed care community network must demonstrate its
17 ability to bear the financial risk of serving enrollees under
18 this program. The Illinois Department shall by rule adopt
19 criteria for assessing the financial soundness of each
20 managed care community network. These rules shall consider
21 the extent to which a managed care community network is
22 comprised of providers who directly render health care and
23 are located within the community in which they seek to
24 contract rather than solely arrange or finance the delivery
25 of health care. These rules shall further consider a variety
26 of risk-bearing and management techniques, including the
27 sufficiency of quality assurance and utilization management
28 programs and whether a managed care community network has
29 sufficiently demonstrated its financial solvency and net
30 worth. The Illinois Department's criteria must be based on
31 sound actuarial, financial, and accounting principles. In
32 adopting these rules, the Illinois Department shall consult
33 with the Illinois Department of Insurance. The Illinois
34 Department is responsible for monitoring compliance with
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1 these rules.
2 This Section may not be implemented before the effective
3 date of these rules, the approval of any necessary federal
4 waivers, and the completion of the review of an application
5 submitted, at least 60 days before the effective date of
6 rules adopted under this Section, to the Illinois Department
7 by a managed care community network.
8 All health care delivery systems that contract with the
9 Illinois Department under the integrated health care program
10 shall clearly recognize a health care provider's right of
11 conscience under the Right of Conscience Act. In addition to
12 the provisions of that Act, no health care delivery system
13 that contracts with the Illinois Department under the
14 integrated health care program shall be required to provide,
15 arrange for, or pay for any health care or medical service,
16 procedure, or product if that health care delivery system is
17 owned, controlled, or sponsored by or affiliated with a
18 religious institution or religious organization that finds
19 that health care or medical service, procedure, or product to
20 violate its religious and moral teachings and beliefs.
21 (b) The Illinois Department may, by rule, provide for
22 different benefit packages for different categories of
23 persons enrolled in the program. Mental health services,
24 alcohol and substance abuse services, services related to
25 children with chronic or acute conditions requiring
26 longer-term treatment and follow-up, and rehabilitation care
27 provided by a free-standing rehabilitation hospital or a
28 hospital rehabilitation unit may be excluded from a benefit
29 package if the State ensures that those services are made
30 available through a separate delivery system. An exclusion
31 does not prohibit the Illinois Department from developing and
32 implementing demonstration projects for categories of persons
33 or services. Benefit packages for persons eligible for
34 medical assistance under Articles V, VI, and XII shall be
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1 based on the requirements of those Articles and shall be
2 consistent with the Title XIX of the Social Security Act.
3 Nothing in this Act shall be construed to apply to services
4 purchased by the Department of Children and Family Services
5 and the Department of Human Services (as successor to the
6 Department of Mental Health and Developmental Disabilities)
7 under the provisions of Title 59 of the Illinois
8 Administrative Code, Part 132 ("Medicaid Community Mental
9 Health Services Program").
10 (c) The program established by this Section may be
11 implemented by the Illinois Department in various contracting
12 areas at various times. The health care delivery systems and
13 providers available under the program may vary throughout the
14 State. For purposes of contracting with managed health care
15 entities and providers, the Illinois Department shall
16 establish contracting areas similar to the geographic areas
17 designated by the Illinois Department for contracting
18 purposes under the Illinois Competitive Access and
19 Reimbursement Equity Program (ICARE) under the authority of
20 Section 3-4 of the Illinois Health Finance Reform Act or
21 similarly-sized or smaller geographic areas established by
22 the Illinois Department by rule. A managed health care entity
23 shall be permitted to contract in any geographic areas for
24 which it has a sufficient provider network and otherwise
25 meets the contracting terms of the State. The Illinois
26 Department is not prohibited from entering into a contract
27 with a managed health care entity at any time.
28 (d) A managed health care entity that contracts with the
29 Illinois Department for the provision of services under the
30 program shall do all of the following, solely for purposes of
31 the integrated health care program:
32 (1) Provide that any individual physician licensed
33 to practice medicine in all its branches, any pharmacy,
34 any federally qualified health center, and any
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1 podiatrist, that consistently meets the reasonable terms
2 and conditions established by the managed health care
3 entity, including but not limited to credentialing
4 standards, quality assurance program requirements,
5 utilization management requirements, financial
6 responsibility standards, contracting process
7 requirements, and provider network size and accessibility
8 requirements, must be accepted by the managed health care
9 entity for purposes of the Illinois integrated health
10 care program. Any individual who is either terminated
11 from or denied inclusion in the panel of physicians of
12 the managed health care entity shall be given, within 10
13 business days after that determination, a written
14 explanation of the reasons for his or her exclusion or
15 termination from the panel. This paragraph (1) does not
16 apply to the following:
17 (A) A managed health care entity that
18 certifies to the Illinois Department that:
19 (i) it employs on a full-time basis 125
20 or more Illinois physicians licensed to
21 practice medicine in all of its branches; and
22 (ii) it will provide medical services
23 through its employees to more than 80% of the
24 recipients enrolled with the entity in the
25 integrated health care program; or
26 (B) A domestic stock insurance company
27 licensed under clause (b) of class 1 of Section 4 of
28 the Illinois Insurance Code if (i) at least 66% of
29 the stock of the insurance company is owned by a
30 professional corporation organized under the
31 Professional Service Corporation Act that has 125 or
32 more shareholders who are Illinois physicians
33 licensed to practice medicine in all of its branches
34 and (ii) the insurance company certifies to the
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1 Illinois Department that at least 80% of those
2 physician shareholders will provide services to
3 recipients enrolled with the company in the
4 integrated health care program.
5 (2) Provide for reimbursement for providers for
6 emergency care, as defined by the Illinois Department by
7 rule, that must be provided to its enrollees, including
8 an emergency room screening fee, and urgent care that it
9 authorizes for its enrollees, regardless of the
10 provider's affiliation with the managed health care
11 entity. Providers shall be reimbursed for emergency care
12 at an amount equal to the Illinois Department's
13 fee-for-service rates for those medical services rendered
14 by providers not under contract with the managed health
15 care entity to enrollees of the entity.
16 (3) Provide that any provider affiliated with a
17 managed health care entity may also provide services on a
18 fee-for-service basis to Illinois Department clients not
19 enrolled in a managed health care entity.
20 (4) Provide client education services as determined
21 and approved by the Illinois Department, including but
22 not limited to (i) education regarding appropriate
23 utilization of health care services in a managed care
24 system, (ii) written disclosure of treatment policies and
25 any restrictions or limitations on health services,
26 including, but not limited to, physical services,
27 clinical laboratory tests, hospital and surgical
28 procedures, prescription drugs and biologics, and
29 radiological examinations, and (iii) written notice that
30 the enrollee may receive from another provider those
31 services covered under this program that are not provided
32 by the managed health care entity.
33 (5) Provide that enrollees within its system may
34 choose the site for provision of services and the panel
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1 of health care providers.
2 (6) Not discriminate in its enrollment or
3 disenrollment practices among recipients of medical
4 services or program enrollees based on health status.
5 (7) Provide a quality assurance and utilization
6 review program that (i) for health maintenance
7 organizations meets the requirements of the Health
8 Maintenance Organization Act and (ii) for managed care
9 community networks meets the requirements established by
10 the Illinois Department in rules that incorporate those
11 standards set forth in the Health Maintenance
12 Organization Act.
13 (8) Issue a managed health care entity
14 identification card to each enrollee upon enrollment.
15 The card must contain all of the following:
16 (A) The enrollee's signature.
17 (B) The enrollee's health plan.
18 (C) The name and telephone number of the
19 enrollee's primary care physician.
20 (D) A telephone number to be used for
21 emergency service 24 hours per day, 7 days per week.
22 The telephone number required to be maintained
23 pursuant to this subparagraph by each managed health
24 care entity shall, at minimum, be staffed by
25 medically trained personnel and be provided
26 directly, or under arrangement, at an office or
27 offices in locations maintained solely within the
28 State of Illinois. For purposes of this
29 subparagraph, "medically trained personnel" means
30 licensed practical nurses or registered nurses
31 located in the State of Illinois who are licensed
32 pursuant to the Illinois Nursing Act of 1987.
33 (9) Ensure that every primary care physician and
34 pharmacy in the managed health care entity meets the
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1 standards established by the Illinois Department for
2 accessibility and quality of care. The Illinois
3 Department shall arrange for and oversee an evaluation of
4 the standards established under this paragraph (9) and
5 may recommend any necessary changes to these standards.
6 The Illinois Department shall submit an annual report to
7 the Governor and the General Assembly by April 1 of each
8 year regarding the effect of the standards on ensuring
9 access and quality of care to enrollees.
10 (10) Provide a procedure for handling complaints
11 that (i) for health maintenance organizations meets the
12 requirements of the Health Maintenance Organization Act
13 and (ii) for managed care community networks meets the
14 requirements established by the Illinois Department in
15 rules that incorporate those standards set forth in the
16 Health Maintenance Organization Act.
17 (11) Maintain, retain, and make available to the
18 Illinois Department records, data, and information, in a
19 uniform manner determined by the Illinois Department,
20 sufficient for the Illinois Department to monitor
21 utilization, accessibility, and quality of care.
22 (12) Except for providers who are prepaid, pay all
23 approved claims for covered services that are completed
24 and submitted to the managed health care entity within 30
25 days after receipt of the claim or receipt of the
26 appropriate capitation payment or payments by the managed
27 health care entity from the State for the month in which
28 the services included on the claim were rendered,
29 whichever is later. If payment is not made or mailed to
30 the provider by the managed health care entity by the due
31 date under this subsection, an interest penalty of 1% of
32 any amount unpaid shall be added for each month or
33 fraction of a month after the due date, until final
34 payment is made. Nothing in this Section shall prohibit
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1 managed health care entities and providers from mutually
2 agreeing to terms that require more timely payment.
3 (13) Provide integration with community-based
4 programs provided by certified local health departments
5 such as Women, Infants, and Children Supplemental Food
6 Program (WIC), childhood immunization programs, health
7 education programs, case management programs, and health
8 screening programs.
9 (14) Provide that the pharmacy formulary used by a
10 managed health care entity and its contract providers be
11 no more restrictive than the Illinois Department's
12 pharmaceutical program on the effective date of this
13 amendatory Act of 1994 and as amended after that date.
14 (15) Provide integration with community-based
15 organizations, including, but not limited to, any
16 organization that has operated within a Medicaid
17 Partnership as defined by this Code or by rule of the
18 Illinois Department, that may continue to operate under a
19 contract with the Illinois Department or a managed health
20 care entity under this Section to provide case management
21 services to Medicaid clients in designated high-need
22 areas.
23 The Illinois Department may, by rule, determine
24 methodologies to limit financial liability for managed health
25 care entities resulting from payment for services to
26 enrollees provided under the Illinois Department's integrated
27 health care program. Any methodology so determined may be
28 considered or implemented by the Illinois Department through
29 a contract with a managed health care entity under this
30 integrated health care program.
31 The Illinois Department shall contract with an entity or
32 entities to provide external peer-based quality assurance
33 review for the integrated health care program. The entity
34 shall be representative of Illinois physicians licensed to
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1 practice medicine in all its branches and have statewide
2 geographic representation in all specialties of medical care
3 that are provided within the integrated health care program.
4 The entity may not be a third party payer and shall maintain
5 offices in locations around the State in order to provide
6 service and continuing medical education to physician
7 participants within the integrated health care program. The
8 review process shall be developed and conducted by Illinois
9 physicians licensed to practice medicine in all its branches.
10 In consultation with the entity, the Illinois Department may
11 contract with other entities for professional peer-based
12 quality assurance review of individual categories of services
13 other than services provided, supervised, or coordinated by
14 physicians licensed to practice medicine in all its branches.
15 The Illinois Department shall establish, by rule, criteria to
16 avoid conflicts of interest in the conduct of quality
17 assurance activities consistent with professional peer-review
18 standards. All quality assurance activities shall be
19 coordinated by the Illinois Department.
20 (e) All persons enrolled in the program shall be
21 provided with a full written explanation of all
22 fee-for-service and managed health care plan options and a
23 reasonable opportunity to choose among the options as
24 provided by rule. The Illinois Department shall provide to
25 enrollees, upon enrollment in the integrated health care
26 program and at least annually thereafter, notice of the
27 process for requesting an appeal under the Illinois
28 Department's administrative appeal procedures.
29 Notwithstanding any other Section of this Code, the Illinois
30 Department may provide by rule for the Illinois Department to
31 assign a person enrolled in the program to a specific
32 provider of medical services or to a specific health care
33 delivery system if an enrollee has failed to exercise choice
34 in a timely manner. An enrollee assigned by the Illinois
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1 Department shall be afforded the opportunity to disenroll and
2 to select a specific provider of medical services or a
3 specific health care delivery system within the first 30 days
4 after the assignment. An enrollee who has failed to exercise
5 choice in a timely manner may be assigned only if there are 3
6 or more managed health care entities contracting with the
7 Illinois Department within the contracting area, except that,
8 outside the City of Chicago, this requirement may be waived
9 for an area by rules adopted by the Illinois Department after
10 consultation with all hospitals within the contracting area.
11 The Illinois Department shall establish by rule the procedure
12 for random assignment of enrollees who fail to exercise
13 choice in a timely manner to a specific managed health care
14 entity in proportion to the available capacity of that
15 managed health care entity. Assignment to a specific provider
16 of medical services or to a specific managed health care
17 entity may not exceed that provider's or entity's capacity as
18 determined by the Illinois Department. Any person who has
19 chosen a specific provider of medical services or a specific
20 managed health care entity, or any person who has been
21 assigned under this subsection, shall be given the
22 opportunity to change that choice or assignment at least once
23 every 12 months, as determined by the Illinois Department by
24 rule. The Illinois Department shall maintain a toll-free
25 telephone number for program enrollees' use in reporting
26 problems with managed health care entities.
27 (f) If a person becomes eligible for participation in
28 the integrated health care program while he or she is
29 hospitalized, the Illinois Department may not enroll that
30 person in the program until after he or she has been
31 discharged from the hospital. This subsection does not apply
32 to newborn infants whose mothers are enrolled in the
33 integrated health care program.
34 (g) The Illinois Department shall, by rule, establish
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1 for managed health care entities rates that (i) are certified
2 to be actuarially sound, as determined by an actuary who is
3 an associate or a fellow of the Society of Actuaries or a
4 member of the American Academy of Actuaries and who has
5 expertise and experience in medical insurance and benefit
6 programs, in accordance with the Illinois Department's
7 current fee-for-service payment system, and (ii) take into
8 account any difference of cost to provide health care to
9 different populations based on gender, age, location, and
10 eligibility category. The rates for managed health care
11 entities shall be determined on a capitated basis.
12 The Illinois Department by rule shall establish a method
13 to adjust its payments to managed health care entities in a
14 manner intended to avoid providing any financial incentive to
15 a managed health care entity to refer patients to a county
16 provider, in an Illinois county having a population greater
17 than 3,000,000, that is paid directly by the Illinois
18 Department. The Illinois Department shall by April 1, 1997,
19 and annually thereafter, review the method to adjust
20 payments. Payments by the Illinois Department to the county
21 provider, for persons not enrolled in a managed care
22 community network owned or operated by a county provider,
23 shall be paid on a fee-for-service basis under Article XV of
24 this Code.
25 The Illinois Department by rule shall establish a method
26 to reduce its payments to managed health care entities to
27 take into consideration (i) any adjustment payments paid to
28 hospitals under subsection (h) of this Section to the extent
29 those payments, or any part of those payments, have been
30 taken into account in establishing capitated rates under this
31 subsection (g) and (ii) the implementation of methodologies
32 to limit financial liability for managed health care entities
33 under subsection (d) of this Section.
34 (h) For hospital services provided by a hospital that
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1 contracts with a managed health care entity, adjustment
2 payments shall be paid directly to the hospital by the
3 Illinois Department. Adjustment payments may include but
4 need not be limited to adjustment payments to:
5 disproportionate share hospitals under Section 5-5.02 of this
6 Code; primary care access health care education payments (89
7 Ill. Adm. Code 149.140); payments for capital, direct medical
8 education, indirect medical education, certified registered
9 nurse anesthetist, and kidney acquisition costs (89 Ill. Adm.
10 Code 149.150(c)); uncompensated care payments (89 Ill. Adm.
11 Code 148.150(h)); trauma center payments (89 Ill. Adm. Code
12 148.290(c)); rehabilitation hospital payments (89 Ill. Adm.
13 Code 148.290(d)); perinatal center payments (89 Ill. Adm.
14 Code 148.290(e)); obstetrical care payments (89 Ill. Adm.
15 Code 148.290(f)); targeted access payments (89 Ill. Adm. Code
16 148.290(g)); Medicaid high volume payments (89 Ill. Adm. Code
17 148.290(h)); and outpatient indigent volume adjustments (89
18 Ill. Adm. Code 148.140(b)(5)).
19 (i) For any hospital eligible for the adjustment
20 payments described in subsection (h), the Illinois Department
21 shall maintain, through the period ending June 30, 1995,
22 reimbursement levels in accordance with statutes and rules in
23 effect on April 1, 1994.
24 (j) Nothing contained in this Code in any way limits or
25 otherwise impairs the authority or power of the Illinois
26 Department to enter into a negotiated contract pursuant to
27 this Section with a managed health care entity, including,
28 but not limited to, a health maintenance organization, that
29 provides for termination or nonrenewal of the contract
30 without cause upon notice as provided in the contract and
31 without a hearing.
32 (k) Section 5-5.15 does not apply to the program
33 developed and implemented pursuant to this Section.
34 (l) The Illinois Department shall, by rule, define those
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1 chronic or acute medical conditions of childhood that require
2 longer-term treatment and follow-up care. The Illinois
3 Department shall ensure that services required to treat these
4 conditions are available through a separate delivery system.
5 A managed health care entity that contracts with the
6 Illinois Department may refer a child with medical conditions
7 described in the rules adopted under this subsection directly
8 to a children's hospital or to a hospital, other than a
9 children's hospital, that is qualified to provide inpatient
10 and outpatient services to treat those conditions. The
11 Illinois Department shall provide fee-for-service
12 reimbursement directly to a children's hospital for those
13 services pursuant to Title 89 of the Illinois Administrative
14 Code, Section 148.280(a), at a rate at least equal to the
15 rate in effect on March 31, 1994. For hospitals, other than
16 children's hospitals, that are qualified to provide inpatient
17 and outpatient services to treat those conditions, the
18 Illinois Department shall provide reimbursement for those
19 services on a fee-for-service basis, at a rate at least equal
20 to the rate in effect for those other hospitals on March 31,
21 1994.
22 A children's hospital shall be directly reimbursed for
23 all services provided at the children's hospital on a
24 fee-for-service basis pursuant to Title 89 of the Illinois
25 Administrative Code, Section 148.280(a), at a rate at least
26 equal to the rate in effect on March 31, 1994, until the
27 later of (i) implementation of the integrated health care
28 program under this Section and development of actuarially
29 sound capitation rates for services other than those chronic
30 or acute medical conditions of childhood that require
31 longer-term treatment and follow-up care as defined by the
32 Illinois Department in the rules adopted under this
33 subsection or (ii) March 31, 1996.
34 Notwithstanding anything in this subsection to the
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1 contrary, a managed health care entity shall not consider
2 sources or methods of payment in determining the referral of
3 a child. The Illinois Department shall adopt rules to
4 establish criteria for those referrals. The Illinois
5 Department by rule shall establish a method to adjust its
6 payments to managed health care entities in a manner intended
7 to avoid providing any financial incentive to a managed
8 health care entity to refer patients to a provider who is
9 paid directly by the Illinois Department.
10 (m) Behavioral health services provided or funded by the
11 Department of Human Services, the Department of Children and
12 Family Services, and the Illinois Department shall be
13 excluded from a benefit package. Conditions of an organic or
14 physical origin or nature, including medical detoxification,
15 however, may not be excluded. In this subsection,
16 "behavioral health services" means mental health services and
17 subacute alcohol and substance abuse treatment services, as
18 defined in the Illinois Alcoholism and Other Drug Dependency
19 Act. In this subsection, "mental health services" includes,
20 at a minimum, the following services funded by the Illinois
21 Department, the Department of Human Services (as successor to
22 the Department of Mental Health and Developmental
23 Disabilities), or the Department of Children and Family
24 Services: (i) inpatient hospital services, including related
25 physician services, related psychiatric interventions, and
26 pharmaceutical services provided to an eligible recipient
27 hospitalized with a primary diagnosis of psychiatric
28 disorder; (ii) outpatient mental health services as defined
29 and specified in Title 59 of the Illinois Administrative
30 Code, Part 132; (iii) any other outpatient mental health
31 services funded by the Illinois Department pursuant to the
32 State of Illinois Medicaid Plan; (iv) partial
33 hospitalization; and (v) follow-up stabilization related to
34 any of those services. Additional behavioral health services
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1 may be excluded under this subsection as mutually agreed in
2 writing by the Illinois Department and the affected State
3 agency or agencies. The exclusion of any service does not
4 prohibit the Illinois Department from developing and
5 implementing demonstration projects for categories of persons
6 or services. The Department of Children and Family Services
7 and the Department of Human Services shall each adopt rules
8 governing the integration of managed care in the provision of
9 behavioral health services. The State shall integrate managed
10 care community networks and affiliated providers, to the
11 extent practicable, in any separate delivery system for
12 mental health services.
13 (n) The Illinois Department shall adopt rules to
14 establish reserve requirements for managed care community
15 networks, as required by subsection (a), and health
16 maintenance organizations to protect against liabilities in
17 the event that a managed health care entity is declared
18 insolvent or bankrupt. If a managed health care entity other
19 than a county provider is declared insolvent or bankrupt,
20 after liquidation and application of any available assets,
21 resources, and reserves, the Illinois Department shall pay a
22 portion of the amounts owed by the managed health care entity
23 to providers for services rendered to enrollees under the
24 integrated health care program under this Section based on
25 the following schedule: (i) from April 1, 1995 through June
26 30, 1998, 90% of the amounts owed; (ii) from July 1, 1998
27 through June 30, 2001, 80% of the amounts owed; and (iii)
28 from July 1, 2001 through June 30, 2005, 75% of the amounts
29 owed. The amounts paid under this subsection shall be
30 calculated based on the total amount owed by the managed
31 health care entity to providers before application of any
32 available assets, resources, and reserves. After June 30,
33 2005, the Illinois Department may not pay any amounts owed to
34 providers as a result of an insolvency or bankruptcy of a
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1 managed health care entity occurring after that date. The
2 Illinois Department is not obligated, however, to pay amounts
3 owed to a provider that has an ownership or other governing
4 interest in the managed health care entity. This subsection
5 applies only to managed health care entities and the services
6 they provide under the integrated health care program under
7 this Section.
8 (o) Notwithstanding any other provision of law or
9 contractual agreement to the contrary, providers shall not be
10 required to accept from any other third party payer the rates
11 determined or paid under this Code by the Illinois
12 Department, managed health care entity, or other health care
13 delivery system for services provided to recipients.
14 (p) The Illinois Department may seek and obtain any
15 necessary authorization provided under federal law to
16 implement the program, including the waiver of any federal
17 statutes or regulations. The Illinois Department may seek a
18 waiver of the federal requirement that the combined
19 membership of Medicare and Medicaid enrollees in a managed
20 care community network may not exceed 75% of the managed care
21 community network's total enrollment. The Illinois
22 Department shall not seek a waiver of this requirement for
23 any other category of managed health care entity. The
24 Illinois Department shall not seek a waiver of the inpatient
25 hospital reimbursement methodology in Section 1902(a)(13)(A)
26 of Title XIX of the Social Security Act even if the federal
27 agency responsible for administering Title XIX determines
28 that Section 1902(a)(13)(A) applies to managed health care
29 systems.
30 Notwithstanding any other provisions of this Code to the
31 contrary, the Illinois Department shall seek a waiver of
32 applicable federal law in order to impose a co-payment system
33 consistent with this subsection on recipients of medical
34 services under Title XIX of the Social Security Act who are
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1 not enrolled in a managed health care entity. The waiver
2 request submitted by the Illinois Department shall provide
3 for co-payments of up to $0.50 for prescribed drugs and up to
4 $0.50 for x-ray services and shall provide for co-payments of
5 up to $10 for non-emergency services provided in a hospital
6 emergency room and up to $10 for non-emergency ambulance
7 services. The purpose of the co-payments shall be to deter
8 those recipients from seeking unnecessary medical care.
9 Co-payments may not be used to deter recipients from seeking
10 necessary medical care. No recipient shall be required to
11 pay more than a total of $150 per year in co-payments under
12 the waiver request required by this subsection. A recipient
13 may not be required to pay more than $15 of any amount due
14 under this subsection in any one month.
15 Co-payments authorized under this subsection may not be
16 imposed when the care was necessitated by a true medical
17 emergency. Co-payments may not be imposed for any of the
18 following classifications of services:
19 (1) Services furnished to person under 18 years of
20 age.
21 (2) Services furnished to pregnant women.
22 (3) Services furnished to any individual who is an
23 inpatient in a hospital, nursing facility, intermediate
24 care facility, or other medical institution, if that
25 person is required to spend for costs of medical care all
26 but a minimal amount of his or her income required for
27 personal needs.
28 (4) Services furnished to a person who is receiving
29 hospice care.
30 Co-payments authorized under this subsection shall not be
31 deducted from or reduce in any way payments for medical
32 services from the Illinois Department to providers. No
33 provider may deny those services to an individual eligible
34 for services based on the individual's inability to pay the
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1 co-payment.
2 Recipients who are subject to co-payments shall be
3 provided notice, in plain and clear language, of the amount
4 of the co-payments, the circumstances under which co-payments
5 are exempted, the circumstances under which co-payments may
6 be assessed, and their manner of collection.
7 The Illinois Department shall establish a Medicaid
8 Co-Payment Council to assist in the development of co-payment
9 policies for the medical assistance program. The Medicaid
10 Co-Payment Council shall also have jurisdiction to develop a
11 program to provide financial or non-financial incentives to
12 Medicaid recipients in order to encourage recipients to seek
13 necessary health care. The Council shall be chaired by the
14 Director of the Illinois Department, and shall have 6
15 additional members. Two of the 6 additional members shall be
16 appointed by the Governor, and one each shall be appointed by
17 the President of the Senate, the Minority Leader of the
18 Senate, the Speaker of the House of Representatives, and the
19 Minority Leader of the House of Representatives. The Council
20 may be convened and make recommendations upon the appointment
21 of a majority of its members. The Council shall be appointed
22 and convened no later than September 1, 1994 and shall report
23 its recommendations to the Director of the Illinois
24 Department and the General Assembly no later than October 1,
25 1994. The chairperson of the Council shall be allowed to
26 vote only in the case of a tie vote among the appointed
27 members of the Council.
28 The Council shall be guided by the following principles
29 as it considers recommendations to be developed to implement
30 any approved waivers that the Illinois Department must seek
31 pursuant to this subsection:
32 (1) Co-payments should not be used to deter access
33 to adequate medical care.
34 (2) Co-payments should be used to reduce fraud.
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1 (3) Co-payment policies should be examined in
2 consideration of other states' experience, and the
3 ability of successful co-payment plans to control
4 unnecessary or inappropriate utilization of services
5 should be promoted.
6 (4) All participants, both recipients and
7 providers, in the medical assistance program have
8 responsibilities to both the State and the program.
9 (5) Co-payments are primarily a tool to educate the
10 participants in the responsible use of health care
11 resources.
12 (6) Co-payments should not be used to penalize
13 providers.
14 (7) A successful medical program requires the
15 elimination of improper utilization of medical resources.
16 The integrated health care program, or any part of that
17 program, established under this Section may not be
18 implemented if matching federal funds under Title XIX of the
19 Social Security Act are not available for administering the
20 program.
21 The Illinois Department shall submit for publication in
22 the Illinois Register the name, address, and telephone number
23 of the individual to whom a request may be directed for a
24 copy of the request for a waiver of provisions of Title XIX
25 of the Social Security Act that the Illinois Department
26 intends to submit to the Health Care Financing Administration
27 in order to implement this Section. The Illinois Department
28 shall mail a copy of that request for waiver to all
29 requestors at least 16 days before filing that request for
30 waiver with the Health Care Financing Administration.
31 (q) After the effective date of this Section, the
32 Illinois Department may take all planning and preparatory
33 action necessary to implement this Section, including, but
34 not limited to, seeking requests for proposals relating to
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1 the integrated health care program created under this
2 Section.
3 (r) In order to (i) accelerate and facilitate the
4 development of integrated health care in contracting areas
5 outside counties with populations in excess of 3,000,000 and
6 counties adjacent to those counties and (ii) maintain and
7 sustain the high quality of education and residency programs
8 coordinated and associated with local area hospitals, the
9 Illinois Department may develop and implement a demonstration
10 program for managed care community networks owned, operated,
11 or governed by State-funded medical schools. The Illinois
12 Department shall prescribe by rule the criteria, standards,
13 and procedures for effecting this demonstration program.
14 (s) (Blank).
15 (t) On April 1, 1995 and every 6 months thereafter, the
16 Illinois Department shall report to the Governor and General
17 Assembly on the progress of the integrated health care
18 program in enrolling clients into managed health care
19 entities. The report shall indicate the capacities of the
20 managed health care entities with which the State contracts,
21 the number of clients enrolled by each contractor, the areas
22 of the State in which managed care options do not exist, and
23 the progress toward meeting the enrollment goals of the
24 integrated health care program.
25 (u) The Illinois Department may implement this Section
26 through the use of emergency rules in accordance with Section
27 5-45 of the Illinois Administrative Procedure Act. For
28 purposes of that Act, the adoption of rules to implement this
29 Section is deemed an emergency and necessary for the public
30 interest, safety, and welfare.
31 (Source: P.A. 88-554, eff. 7-26-94; 89-21, eff. 7-1-95;
32 89-507, eff. 7-1-97; 89-673, eff. 8-14-96; revised 8-26-96.)
33 Section 95. No acceleration or delay. Where this Act
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1 makes changes in a statute that is represented in this Act by
2 text that is not yet or no longer in effect (for example, a
3 Section represented by multiple versions), the use of that
4 text does not accelerate or delay the taking effect of (i)
5 the changes made by this Act or (ii) provisions derived from
6 any other Public Act.
7 Section 99. Effective date. This Act takes effect upon
8 becoming law.