[ Search ] [ Legislation ] [ Bill Summary ]
[ Home ] [ Back ] [ Bottom ]
90_HB0783
305 ILCS 5/5-16.3
Amends the Medicaid Article of the Public Aid Code. In
the Section concerning the integrated health care program,
requires that a managed health care entity report certain
financial information to the Department of Public Aid.
Requires that the Department report that information to the
General Assembly. Authorizes the Department to establish
limits on the amounts a managed health care entity may pay to
its owners, officers, employees, and agents. Effective
immediately.
LRB9000968DJcd
LRB9000968DJcd
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.
-2- LRB9000968DJcd
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 Each managed care community network must demonstrate its
30 ability to bear the financial risk of serving enrollees under
31 this program. The Illinois Department shall by rule adopt
32 criteria for assessing the financial soundness of each
33 managed care community network. These rules shall consider
34 the extent to which a managed care community network is
-3- LRB9000968DJcd
1 comprised of providers who directly render health care and
2 are located within the community in which they seek to
3 contract rather than solely arrange or finance the delivery
4 of health care. These rules shall further consider a variety
5 of risk-bearing and management techniques, including the
6 sufficiency of quality assurance and utilization management
7 programs and whether a managed care community network has
8 sufficiently demonstrated its financial solvency and net
9 worth. The Illinois Department's criteria must be based on
10 sound actuarial, financial, and accounting principles. In
11 adopting these rules, the Illinois Department shall consult
12 with the Illinois Department of Insurance. The Illinois
13 Department is responsible for monitoring compliance with
14 these rules.
15 This Section may not be implemented before the effective
16 date of these rules, the approval of any necessary federal
17 waivers, and the completion of the review of an application
18 submitted, at least 60 days before the effective date of
19 rules adopted under this Section, to the Illinois Department
20 by a managed care community network.
21 All health care delivery systems that contract with the
22 Illinois Department under the integrated health care program
23 shall clearly recognize a health care provider's right of
24 conscience under the Right of Conscience Act. In addition to
25 the provisions of that Act, no health care delivery system
26 that contracts with the Illinois Department under the
27 integrated health care program shall be required to provide,
28 arrange for, or pay for any health care or medical service,
29 procedure, or product if that health care delivery system is
30 owned, controlled, or sponsored by or affiliated with a
31 religious institution or religious organization that finds
32 that health care or medical service, procedure, or product to
33 violate its religious and moral teachings and beliefs.
34 (b) The Illinois Department may, by rule, provide for
-4- LRB9000968DJcd
1 different benefit packages for different categories of
2 persons enrolled in the program. Mental health services,
3 alcohol and substance abuse services, services related to
4 children with chronic or acute conditions requiring
5 longer-term treatment and follow-up, and rehabilitation care
6 provided by a free-standing rehabilitation hospital or a
7 hospital rehabilitation unit may be excluded from a benefit
8 package if the State ensures that those services are made
9 available through a separate delivery system. An exclusion
10 does not prohibit the Illinois Department from developing and
11 implementing demonstration projects for categories of persons
12 or services. Benefit packages for persons eligible for
13 medical assistance under Articles V, VI, and XII shall be
14 based on the requirements of those Articles and shall be
15 consistent with the Title XIX of the Social Security Act.
16 Nothing in this Act shall be construed to apply to services
17 purchased by the Department of Children and Family Services
18 and the Department of Mental Health and Developmental
19 Disabilities under the provisions of Title 59 of the Illinois
20 Administrative Code, Part 132 ("Medicaid Community Mental
21 Health Services Program").
22 (c) The program established by this Section may be
23 implemented by the Illinois Department in various contracting
24 areas at various times. The health care delivery systems and
25 providers available under the program may vary throughout the
26 State. For purposes of contracting with managed health care
27 entities and providers, the Illinois Department shall
28 establish contracting areas similar to the geographic areas
29 designated by the Illinois Department for contracting
30 purposes under the Illinois Competitive Access and
31 Reimbursement Equity Program (ICARE) under the authority of
32 Section 3-4 of the Illinois Health Finance Reform Act or
33 similarly-sized or smaller geographic areas established by
34 the Illinois Department by rule. A managed health care entity
-5- LRB9000968DJcd
1 shall be permitted to contract in any geographic areas for
2 which it has a sufficient provider network and otherwise
3 meets the contracting terms of the State. The Illinois
4 Department is not prohibited from entering into a contract
5 with a managed health care entity at any time.
6 (d) A managed health care entity that contracts with the
7 Illinois Department for the provision of services under the
8 program shall do all of the following, solely for purposes of
9 the integrated health care program:
10 (1) Provide that any individual physician licensed
11 to practice medicine in all its branches, any pharmacy,
12 any federally qualified health center, and any
13 podiatrist, that consistently meets the reasonable terms
14 and conditions established by the managed health care
15 entity, including but not limited to credentialing
16 standards, quality assurance program requirements,
17 utilization management requirements, financial
18 responsibility standards, contracting process
19 requirements, and provider network size and accessibility
20 requirements, must be accepted by the managed health care
21 entity for purposes of the Illinois integrated health
22 care program. Any individual who is either terminated
23 from or denied inclusion in the panel of physicians of
24 the managed health care entity shall be given, within 10
25 business days after that determination, a written
26 explanation of the reasons for his or her exclusion or
27 termination from the panel. This paragraph (1) does not
28 apply to the following:
29 (A) A managed health care entity that
30 certifies to the Illinois Department that:
31 (i) it employs on a full-time basis 125
32 or more Illinois physicians licensed to
33 practice medicine in all of its branches; and
34 (ii) it will provide medical services
-6- LRB9000968DJcd
1 through its employees to more than 80% of the
2 recipients enrolled with the entity in the
3 integrated health care program; or
4 (B) A domestic stock insurance company
5 licensed under clause (b) of class 1 of Section 4 of
6 the Illinois Insurance Code if (i) at least 66% of
7 the stock of the insurance company is owned by a
8 professional corporation organized under the
9 Professional Service Corporation Act that has 125 or
10 more shareholders who are Illinois physicians
11 licensed to practice medicine in all of its branches
12 and (ii) the insurance company certifies to the
13 Illinois Department that at least 80% of those
14 physician shareholders will provide services to
15 recipients enrolled with the company in the
16 integrated health care program.
17 (2) Provide for reimbursement for providers for
18 emergency care, as defined by the Illinois Department by
19 rule, that must be provided to its enrollees, including
20 an emergency room screening fee, and urgent care that it
21 authorizes for its enrollees, regardless of the
22 provider's affiliation with the managed health care
23 entity. Providers shall be reimbursed for emergency care
24 at an amount equal to the Illinois Department's
25 fee-for-service rates for those medical services rendered
26 by providers not under contract with the managed health
27 care entity to enrollees of the entity.
28 (3) Provide that any provider affiliated with a
29 managed health care entity may also provide services on a
30 fee-for-service basis to Illinois Department clients not
31 enrolled in a managed health care entity.
32 (4) Provide client education services as determined
33 and approved by the Illinois Department, including but
34 not limited to (i) education regarding appropriate
-7- LRB9000968DJcd
1 utilization of health care services in a managed care
2 system, (ii) written disclosure of treatment policies and
3 any restrictions or limitations on health services,
4 including, but not limited to, physical services,
5 clinical laboratory tests, hospital and surgical
6 procedures, prescription drugs and biologics, and
7 radiological examinations, and (iii) written notice that
8 the enrollee may receive from another provider those
9 services covered under this program that are not provided
10 by the managed health care entity.
11 (5) Provide that enrollees within its system may
12 choose the site for provision of services and the panel
13 of health care providers.
14 (6) Not discriminate in its enrollment or
15 disenrollment practices among recipients of medical
16 services or program enrollees based on health status.
17 (7) Provide a quality assurance and utilization
18 review program that (i) for health maintenance
19 organizations meets the requirements of the Health
20 Maintenance Organization Act and (ii) for managed care
21 community networks meets the requirements established by
22 the Illinois Department in rules that incorporate those
23 standards set forth in the Health Maintenance
24 Organization Act.
25 (8) Issue a managed health care entity
26 identification card to each enrollee upon enrollment.
27 The card must contain all of the following:
28 (A) The enrollee's signature.
29 (B) The enrollee's health plan.
30 (C) The name and telephone number of the
31 enrollee's primary care physician.
32 (D) A telephone number to be used for
33 emergency service 24 hours per day, 7 days per week.
34 The telephone number required to be maintained
-8- LRB9000968DJcd
1 pursuant to this subparagraph by each managed health
2 care entity shall, at minimum, be staffed by
3 medically trained personnel and be provided
4 directly, or under arrangement, at an office or
5 offices in locations maintained solely within the
6 State of Illinois. For purposes of this
7 subparagraph, "medically trained personnel" means
8 licensed practical nurses or registered nurses
9 located in the State of Illinois who are licensed
10 pursuant to the Illinois Nursing Act of 1987.
11 (9) Ensure that every primary care physician and
12 pharmacy in the managed health care entity meets the
13 standards established by the Illinois Department for
14 accessibility and quality of care. The Illinois
15 Department shall arrange for and oversee an evaluation of
16 the standards established under this paragraph (9) and
17 may recommend any necessary changes to these standards.
18 The Illinois Department shall submit an annual report to
19 the Governor and the General Assembly by April 1 of each
20 year regarding the effect of the standards on ensuring
21 access and quality of care to enrollees.
22 (10) Provide a procedure for handling complaints
23 that (i) for health maintenance organizations meets the
24 requirements of the Health Maintenance Organization Act
25 and (ii) for managed care community networks meets the
26 requirements established by the Illinois Department in
27 rules that incorporate those standards set forth in the
28 Health Maintenance Organization Act.
29 (11) Maintain, retain, and make available to the
30 Illinois Department records, data, and information, in a
31 uniform manner determined by the Illinois Department,
32 sufficient for the Illinois Department to monitor
33 utilization, accessibility, and quality of care.
34 (12) Except for providers who are prepaid, pay all
-9- LRB9000968DJcd
1 approved claims for covered services that are completed
2 and submitted to the managed health care entity within 30
3 days after receipt of the claim or receipt of the
4 appropriate capitation payment or payments by the managed
5 health care entity from the State for the month in which
6 the services included on the claim were rendered,
7 whichever is later. If payment is not made or mailed to
8 the provider by the managed health care entity by the due
9 date under this subsection, an interest penalty of 1% of
10 any amount unpaid shall be added for each month or
11 fraction of a month after the due date, until final
12 payment is made. Nothing in this Section shall prohibit
13 managed health care entities and providers from mutually
14 agreeing to terms that require more timely payment.
15 (13) Provide integration with community-based
16 programs provided by certified local health departments
17 such as Women, Infants, and Children Supplemental Food
18 Program (WIC), childhood immunization programs, health
19 education programs, case management programs, and health
20 screening programs.
21 (14) Provide that the pharmacy formulary used by a
22 managed health care entity and its contract providers be
23 no more restrictive than the Illinois Department's
24 pharmaceutical program on the effective date of this
25 amendatory Act of 1994 and as amended after that date.
26 (15) Provide integration with community-based
27 organizations, including, but not limited to, any
28 organization that has operated within a Medicaid
29 Partnership as defined by this Code or by rule of the
30 Illinois Department, that may continue to operate under a
31 contract with the Illinois Department or a managed health
32 care entity under this Section to provide case management
33 services to Medicaid clients in designated high-need
34 areas.
-10- LRB9000968DJcd
1 The Illinois Department may, by rule, determine
2 methodologies to limit financial liability for managed health
3 care entities resulting from payment for services to
4 enrollees provided under the Illinois Department's integrated
5 health care program. Any methodology so determined may be
6 considered or implemented by the Illinois Department through
7 a contract with a managed health care entity under this
8 integrated health care program.
9 The Illinois Department shall contract with an entity or
10 entities to provide external peer-based quality assurance
11 review for the integrated health care program. The entity
12 shall be representative of Illinois physicians licensed to
13 practice medicine in all its branches and have statewide
14 geographic representation in all specialties of medical care
15 that are provided within the integrated health care program.
16 The entity may not be a third party payer and shall maintain
17 offices in locations around the State in order to provide
18 service and continuing medical education to physician
19 participants within the integrated health care program. The
20 review process shall be developed and conducted by Illinois
21 physicians licensed to practice medicine in all its branches.
22 In consultation with the entity, the Illinois Department may
23 contract with other entities for professional peer-based
24 quality assurance review of individual categories of services
25 other than services provided, supervised, or coordinated by
26 physicians licensed to practice medicine in all its branches.
27 The Illinois Department shall establish, by rule, criteria to
28 avoid conflicts of interest in the conduct of quality
29 assurance activities consistent with professional peer-review
30 standards. All quality assurance activities shall be
31 coordinated by the Illinois Department.
32 (e) All persons enrolled in the program shall be
33 provided with a full written explanation of all
34 fee-for-service and managed health care plan options and a
-11- LRB9000968DJcd
1 reasonable opportunity to choose among the options as
2 provided by rule. The Illinois Department shall provide to
3 enrollees, upon enrollment in the integrated health care
4 program and at least annually thereafter, notice of the
5 process for requesting an appeal under the Illinois
6 Department's administrative appeal procedures.
7 Notwithstanding any other Section of this Code, the Illinois
8 Department may provide by rule for the Illinois Department to
9 assign a person enrolled in the program to a specific
10 provider of medical services or to a specific health care
11 delivery system if an enrollee has failed to exercise choice
12 in a timely manner. An enrollee assigned by the Illinois
13 Department shall be afforded the opportunity to disenroll and
14 to select a specific provider of medical services or a
15 specific health care delivery system within the first 30 days
16 after the assignment. An enrollee who has failed to exercise
17 choice in a timely manner may be assigned only if there are 3
18 or more managed health care entities contracting with the
19 Illinois Department within the contracting area, except that,
20 outside the City of Chicago, this requirement may be waived
21 for an area by rules adopted by the Illinois Department after
22 consultation with all hospitals within the contracting area.
23 The Illinois Department shall establish by rule the procedure
24 for random assignment of enrollees who fail to exercise
25 choice in a timely manner to a specific managed health care
26 entity in proportion to the available capacity of that
27 managed health care entity. Assignment to a specific provider
28 of medical services or to a specific managed health care
29 entity may not exceed that provider's or entity's capacity as
30 determined by the Illinois Department. Any person who has
31 chosen a specific provider of medical services or a specific
32 managed health care entity, or any person who has been
33 assigned under this subsection, shall be given the
34 opportunity to change that choice or assignment at least once
-12- LRB9000968DJcd
1 every 12 months, as determined by the Illinois Department by
2 rule. The Illinois Department shall maintain a toll-free
3 telephone number for program enrollees' use in reporting
4 problems with managed health care entities.
5 (f) If a person becomes eligible for participation in
6 the integrated health care program while he or she is
7 hospitalized, the Illinois Department may not enroll that
8 person in the program until after he or she has been
9 discharged from the hospital. This subsection does not apply
10 to newborn infants whose mothers are enrolled in the
11 integrated health care program.
12 (g) The Illinois Department shall, by rule, establish
13 for managed health care entities rates that (i) are certified
14 to be actuarially sound, as determined by an actuary who is
15 an associate or a fellow of the Society of Actuaries or a
16 member of the American Academy of Actuaries and who has
17 expertise and experience in medical insurance and benefit
18 programs, in accordance with the Illinois Department's
19 current fee-for-service payment system, and (ii) take into
20 account any difference of cost to provide health care to
21 different populations based on gender, age, location, and
22 eligibility category. The rates for managed health care
23 entities shall be determined on a capitated basis.
24 The Illinois Department by rule shall establish a method
25 to adjust its payments to managed health care entities in a
26 manner intended to avoid providing any financial incentive to
27 a managed health care entity to refer patients to a county
28 provider, in an Illinois county having a population greater
29 than 3,000,000, that is paid directly by the Illinois
30 Department. The Illinois Department shall by April 1, 1997,
31 and annually thereafter, review the method to adjust
32 payments. Payments by the Illinois Department to the county
33 provider, for persons not enrolled in a managed care
34 community network owned or operated by a county provider,
-13- LRB9000968DJcd
1 shall be paid on a fee-for-service basis under Article XV of
2 this Code.
3 The Illinois Department by rule shall establish a method
4 to reduce its payments to managed health care entities to
5 take into consideration (i) any adjustment payments paid to
6 hospitals under subsection (h) of this Section to the extent
7 those payments, or any part of those payments, have been
8 taken into account in establishing capitated rates under this
9 subsection (g) and (ii) the implementation of methodologies
10 to limit financial liability for managed health care entities
11 under subsection (d) of this Section.
12 (g-5) After December 31 of each year and before March 1
13 of the succeeding year, every managed health care entity that
14 participates in the integrated health care program shall file
15 a report with the Illinois Department. The report shall be
16 in the form specified by the Illinois Department. The
17 Illinois Department may specify that the report include,
18 without limitation, all salaries, wages, reimbursements,
19 benefits, and other consideration paid to the entity's
20 owners, officers, employees, and agents during the calendar
21 year just ended.
22 If a physician providing or proposing to provide medical
23 services to a managed health care entity's enrollees makes a
24 report to the Department of Professional Regulation required
25 under paragraph 34, 35, or 36 of Section 22 of the Medical
26 Practice Act of 1987, the managed health care entity shall
27 cause a copy of the report to be submitted to the Illinois
28 Department.
29 Every managed health care entity required to report under
30 this subsection shall keep records and books that will permit
31 verification of the information required to be reported under
32 this subsection. All such books and records shall be kept in
33 the English language and shall, at all times during business
34 hours of the day, be subject to inspection by the Illinois
-14- LRB9000968DJcd
1 Department or its authorized agents and employees.
2 In order to prevent profiteering by a managed health care
3 entity as a result of the entity's participation in the
4 managed health care program, the Illinois Department may, by
5 rule, establish limits on the amounts a managed health care
6 entity may pay to its owners, officers, employees, and
7 agents.
8 On or before April 1 of each year, the Illinois
9 Department shall report the following to the General
10 Assembly:
11 (1) Amounts reported paid to managed health care
12 entity owners, officers, employees, and agents, if
13 required to be reported by managed health care entities
14 under this subsection, for the preceding calendar year.
15 (2) Any limitations on amounts paid by managed
16 health care entities imposed by the Illinois Department
17 under this subsection.
18 (h) For hospital services provided by a hospital that
19 contracts with a managed health care entity, adjustment
20 payments shall be paid directly to the hospital by the
21 Illinois Department. Adjustment payments may include but
22 need not be limited to adjustment payments to:
23 disproportionate share hospitals under Section 5-5.02 of this
24 Code; primary care access health care education payments (89
25 Ill. Adm. Code 149.140); payments for capital, direct medical
26 education, indirect medical education, certified registered
27 nurse anesthetist, and kidney acquisition costs (89 Ill. Adm.
28 Code 149.150(c)); uncompensated care payments (89 Ill. Adm.
29 Code 148.150(h)); trauma center payments (89 Ill. Adm. Code
30 148.290(c)); rehabilitation hospital payments (89 Ill. Adm.
31 Code 148.290(d)); perinatal center payments (89 Ill. Adm.
32 Code 148.290(e)); obstetrical care payments (89 Ill. Adm.
33 Code 148.290(f)); targeted access payments (89 Ill. Adm. Code
34 148.290(g)); Medicaid high volume payments (89 Ill. Adm. Code
-15- LRB9000968DJcd
1 148.290(h)); and outpatient indigent volume adjustments (89
2 Ill. Adm. Code 148.140(b)(5)).
3 (i) For any hospital eligible for the adjustment
4 payments described in subsection (h), the Illinois Department
5 shall maintain, through the period ending June 30, 1995,
6 reimbursement levels in accordance with statutes and rules in
7 effect on April 1, 1994.
8 (j) Nothing contained in this Code in any way limits or
9 otherwise impairs the authority or power of the Illinois
10 Department to enter into a negotiated contract pursuant to
11 this Section with a managed health care entity, including,
12 but not limited to, a health maintenance organization, that
13 provides for termination or nonrenewal of the contract
14 without cause upon notice as provided in the contract and
15 without a hearing.
16 (k) Section 5-5.15 does not apply to the program
17 developed and implemented pursuant to this Section.
18 (l) The Illinois Department shall, by rule, define those
19 chronic or acute medical conditions of childhood that require
20 longer-term treatment and follow-up care. The Illinois
21 Department shall ensure that services required to treat these
22 conditions are available through a separate delivery system.
23 A managed health care entity that contracts with the
24 Illinois Department may refer a child with medical conditions
25 described in the rules adopted under this subsection directly
26 to a children's hospital or to a hospital, other than a
27 children's hospital, that is qualified to provide inpatient
28 and outpatient services to treat those conditions. The
29 Illinois Department shall provide fee-for-service
30 reimbursement directly to a children's hospital for those
31 services pursuant to Title 89 of the Illinois Administrative
32 Code, Section 148.280(a), at a rate at least equal to the
33 rate in effect on March 31, 1994. For hospitals, other than
34 children's hospitals, that are qualified to provide inpatient
-16- LRB9000968DJcd
1 and outpatient services to treat those conditions, the
2 Illinois Department shall provide reimbursement for those
3 services on a fee-for-service basis, at a rate at least equal
4 to the rate in effect for those other hospitals on March 31,
5 1994.
6 A children's hospital shall be directly reimbursed for
7 all services provided at the children's hospital on a
8 fee-for-service basis pursuant to Title 89 of the Illinois
9 Administrative Code, Section 148.280(a), at a rate at least
10 equal to the rate in effect on March 31, 1994, until the
11 later of (i) implementation of the integrated health care
12 program under this Section and development of actuarially
13 sound capitation rates for services other than those chronic
14 or acute medical conditions of childhood that require
15 longer-term treatment and follow-up care as defined by the
16 Illinois Department in the rules adopted under this
17 subsection or (ii) March 31, 1996.
18 Notwithstanding anything in this subsection to the
19 contrary, a managed health care entity shall not consider
20 sources or methods of payment in determining the referral of
21 a child. The Illinois Department shall adopt rules to
22 establish criteria for those referrals. The Illinois
23 Department by rule shall establish a method to adjust its
24 payments to managed health care entities in a manner intended
25 to avoid providing any financial incentive to a managed
26 health care entity to refer patients to a provider who is
27 paid directly by the Illinois Department.
28 (m) Behavioral health services provided or funded by the
29 Department of Mental Health and Developmental Disabilities,
30 the Department of Alcoholism and Substance Abuse, the
31 Department of Children and Family Services, and the Illinois
32 Department shall be excluded from a benefit package.
33 Conditions of an organic or physical origin or nature,
34 including medical detoxification, however, may not be
-17- LRB9000968DJcd
1 excluded. In this subsection, "behavioral health services"
2 means mental health services and subacute alcohol and
3 substance abuse treatment services, as defined in the
4 Illinois Alcoholism and Other Drug Dependency Act. In this
5 subsection, "mental health services" includes, at a minimum,
6 the following services funded by the Illinois Department, the
7 Department of Mental Health and Developmental Disabilities,
8 or the Department of Children and Family Services: (i)
9 inpatient hospital services, including related physician
10 services, related psychiatric interventions, and
11 pharmaceutical services provided to an eligible recipient
12 hospitalized with a primary diagnosis of psychiatric
13 disorder; (ii) outpatient mental health services as defined
14 and specified in Title 59 of the Illinois Administrative
15 Code, Part 132; (iii) any other outpatient mental health
16 services funded by the Illinois Department pursuant to the
17 State of Illinois Medicaid Plan; (iv) partial
18 hospitalization; and (v) follow-up stabilization related to
19 any of those services. Additional behavioral health services
20 may be excluded under this subsection as mutually agreed in
21 writing by the Illinois Department and the affected State
22 agency or agencies. The exclusion of any service does not
23 prohibit the Illinois Department from developing and
24 implementing demonstration projects for categories of persons
25 or services. The Department of Mental Health and
26 Developmental Disabilities, the Department of Children and
27 Family Services, and the Department of Alcoholism and
28 Substance Abuse shall each adopt rules governing the
29 integration of managed care in the provision of behavioral
30 health services. The State shall integrate managed care
31 community networks and affiliated providers, to the extent
32 practicable, in any separate delivery system for mental
33 health services.
34 (n) The Illinois Department shall adopt rules to
-18- LRB9000968DJcd
1 establish reserve requirements for managed care community
2 networks, as required by subsection (a), and health
3 maintenance organizations to protect against liabilities in
4 the event that a managed health care entity is declared
5 insolvent or bankrupt. If a managed health care entity other
6 than a county provider is declared insolvent or bankrupt,
7 after liquidation and application of any available assets,
8 resources, and reserves, the Illinois Department shall pay a
9 portion of the amounts owed by the managed health care entity
10 to providers for services rendered to enrollees under the
11 integrated health care program under this Section based on
12 the following schedule: (i) from April 1, 1995 through June
13 30, 1998, 90% of the amounts owed; (ii) from July 1, 1998
14 through June 30, 2001, 80% of the amounts owed; and (iii)
15 from July 1, 2001 through June 30, 2005, 75% of the amounts
16 owed. The amounts paid under this subsection shall be
17 calculated based on the total amount owed by the managed
18 health care entity to providers before application of any
19 available assets, resources, and reserves. After June 30,
20 2005, the Illinois Department may not pay any amounts owed to
21 providers as a result of an insolvency or bankruptcy of a
22 managed health care entity occurring after that date. The
23 Illinois Department is not obligated, however, to pay amounts
24 owed to a provider that has an ownership or other governing
25 interest in the managed health care entity. This subsection
26 applies only to managed health care entities and the services
27 they provide under the integrated health care program under
28 this Section.
29 (o) Notwithstanding any other provision of law or
30 contractual agreement to the contrary, providers shall not be
31 required to accept from any other third party payer the rates
32 determined or paid under this Code by the Illinois
33 Department, managed health care entity, or other health care
34 delivery system for services provided to recipients.
-19- LRB9000968DJcd
1 (p) The Illinois Department may seek and obtain any
2 necessary authorization provided under federal law to
3 implement the program, including the waiver of any federal
4 statutes or regulations. The Illinois Department may seek a
5 waiver of the federal requirement that the combined
6 membership of Medicare and Medicaid enrollees in a managed
7 care community network may not exceed 75% of the managed care
8 community network's total enrollment. The Illinois
9 Department shall not seek a waiver of this requirement for
10 any other category of managed health care entity. The
11 Illinois Department shall not seek a waiver of the inpatient
12 hospital reimbursement methodology in Section 1902(a)(13)(A)
13 of Title XIX of the Social Security Act even if the federal
14 agency responsible for administering Title XIX determines
15 that Section 1902(a)(13)(A) applies to managed health care
16 systems.
17 Notwithstanding any other provisions of this Code to the
18 contrary, the Illinois Department shall seek a waiver of
19 applicable federal law in order to impose a co-payment system
20 consistent with this subsection on recipients of medical
21 services under Title XIX of the Social Security Act who are
22 not enrolled in a managed health care entity. The waiver
23 request submitted by the Illinois Department shall provide
24 for co-payments of up to $0.50 for prescribed drugs and up to
25 $0.50 for x-ray services and shall provide for co-payments of
26 up to $10 for non-emergency services provided in a hospital
27 emergency room and up to $10 for non-emergency ambulance
28 services. The purpose of the co-payments shall be to deter
29 those recipients from seeking unnecessary medical care.
30 Co-payments may not be used to deter recipients from seeking
31 necessary medical care. No recipient shall be required to
32 pay more than a total of $150 per year in co-payments under
33 the waiver request required by this subsection. A recipient
34 may not be required to pay more than $15 of any amount due
-20- LRB9000968DJcd
1 under this subsection in any one month.
2 Co-payments authorized under this subsection may not be
3 imposed when the care was necessitated by a true medical
4 emergency. Co-payments may not be imposed for any of the
5 following classifications of services:
6 (1) Services furnished to person under 18 years of
7 age.
8 (2) Services furnished to pregnant women.
9 (3) Services furnished to any individual who is an
10 inpatient in a hospital, nursing facility, intermediate
11 care facility, or other medical institution, if that
12 person is required to spend for costs of medical care all
13 but a minimal amount of his or her income required for
14 personal needs.
15 (4) Services furnished to a person who is receiving
16 hospice care.
17 Co-payments authorized under this subsection shall not be
18 deducted from or reduce in any way payments for medical
19 services from the Illinois Department to providers. No
20 provider may deny those services to an individual eligible
21 for services based on the individual's inability to pay the
22 co-payment.
23 Recipients who are subject to co-payments shall be
24 provided notice, in plain and clear language, of the amount
25 of the co-payments, the circumstances under which co-payments
26 are exempted, the circumstances under which co-payments may
27 be assessed, and their manner of collection.
28 The Illinois Department shall establish a Medicaid
29 Co-Payment Council to assist in the development of co-payment
30 policies for the medical assistance program. The Medicaid
31 Co-Payment Council shall also have jurisdiction to develop a
32 program to provide financial or non-financial incentives to
33 Medicaid recipients in order to encourage recipients to seek
34 necessary health care. The Council shall be chaired by the
-21- LRB9000968DJcd
1 Director of the Illinois Department, and shall have 6
2 additional members. Two of the 6 additional members shall be
3 appointed by the Governor, and one each shall be appointed by
4 the President of the Senate, the Minority Leader of the
5 Senate, the Speaker of the House of Representatives, and the
6 Minority Leader of the House of Representatives. The Council
7 may be convened and make recommendations upon the appointment
8 of a majority of its members. The Council shall be appointed
9 and convened no later than September 1, 1994 and shall report
10 its recommendations to the Director of the Illinois
11 Department and the General Assembly no later than October 1,
12 1994. The chairperson of the Council shall be allowed to
13 vote only in the case of a tie vote among the appointed
14 members of the Council.
15 The Council shall be guided by the following principles
16 as it considers recommendations to be developed to implement
17 any approved waivers that the Illinois Department must seek
18 pursuant to this subsection:
19 (1) Co-payments should not be used to deter access
20 to adequate medical care.
21 (2) Co-payments should be used to reduce fraud.
22 (3) Co-payment policies should be examined in
23 consideration of other states' experience, and the
24 ability of successful co-payment plans to control
25 unnecessary or inappropriate utilization of services
26 should be promoted.
27 (4) All participants, both recipients and
28 providers, in the medical assistance program have
29 responsibilities to both the State and the program.
30 (5) Co-payments are primarily a tool to educate the
31 participants in the responsible use of health care
32 resources.
33 (6) Co-payments should not be used to penalize
34 providers.
-22- LRB9000968DJcd
1 (7) A successful medical program requires the
2 elimination of improper utilization of medical resources.
3 The integrated health care program, or any part of that
4 program, established under this Section may not be
5 implemented if matching federal funds under Title XIX of the
6 Social Security Act are not available for administering the
7 program.
8 The Illinois Department shall submit for publication in
9 the Illinois Register the name, address, and telephone number
10 of the individual to whom a request may be directed for a
11 copy of the request for a waiver of provisions of Title XIX
12 of the Social Security Act that the Illinois Department
13 intends to submit to the Health Care Financing Administration
14 in order to implement this Section. The Illinois Department
15 shall mail a copy of that request for waiver to all
16 requestors at least 16 days before filing that request for
17 waiver with the Health Care Financing Administration.
18 (q) After the effective date of this Section, the
19 Illinois Department may take all planning and preparatory
20 action necessary to implement this Section, including, but
21 not limited to, seeking requests for proposals relating to
22 the integrated health care program created under this
23 Section.
24 (r) In order to (i) accelerate and facilitate the
25 development of integrated health care in contracting areas
26 outside counties with populations in excess of 3,000,000 and
27 counties adjacent to those counties and (ii) maintain and
28 sustain the high quality of education and residency programs
29 coordinated and associated with local area hospitals, the
30 Illinois Department may develop and implement a demonstration
31 program for managed care community networks owned, operated,
32 or governed by State-funded medical schools. The Illinois
33 Department shall prescribe by rule the criteria, standards,
34 and procedures for effecting this demonstration program.
-23- LRB9000968DJcd
1 (s) (Blank).
2 (t) On April 1, 1995 and every 6 months thereafter, the
3 Illinois Department shall report to the Governor and General
4 Assembly on the progress of the integrated health care
5 program in enrolling clients into managed health care
6 entities. The report shall indicate the capacities of the
7 managed health care entities with which the State contracts,
8 the number of clients enrolled by each contractor, the areas
9 of the State in which managed care options do not exist, and
10 the progress toward meeting the enrollment goals of the
11 integrated health care program.
12 (u) The Illinois Department may implement this Section
13 through the use of emergency rules in accordance with Section
14 5-45 of the Illinois Administrative Procedure Act. For
15 purposes of that Act, the adoption of rules to implement this
16 Section is deemed an emergency and necessary for the public
17 interest, safety, and welfare.
18 (Source: P.A. 88-554, eff. 7-26-94; 89-21, eff. 7-1-95;
19 89-673, eff. 8-14-96; revised 8-26-96.)
20 (Text of Section after amendment by P.A. 89-507)
21 Sec. 5-16.3. System for integrated health care services.
22 (a) It shall be the public policy of the State to adopt,
23 to the extent practicable, a health care program that
24 encourages the integration of health care services and
25 manages the health care of program enrollees while preserving
26 reasonable choice within a competitive and cost-efficient
27 environment. In furtherance of this public policy, the
28 Illinois Department shall develop and implement an integrated
29 health care program consistent with the provisions of this
30 Section. The provisions of this Section apply only to the
31 integrated health care program created under this Section.
32 Persons enrolled in the integrated health care program, as
33 determined by the Illinois Department by rule, shall be
34 afforded a choice among health care delivery systems, which
-24- LRB9000968DJcd
1 shall include, but are not limited to, (i) fee for service
2 care managed by a primary care physician licensed to practice
3 medicine in all its branches, (ii) managed health care
4 entities, and (iii) federally qualified health centers
5 (reimbursed according to a prospective cost-reimbursement
6 methodology) and rural health clinics (reimbursed according
7 to the Medicare methodology), where available. Persons
8 enrolled in the integrated health care program also may be
9 offered indemnity insurance plans, subject to availability.
10 For purposes of this Section, a "managed health care
11 entity" means a health maintenance organization or a managed
12 care community network as defined in this Section. A "health
13 maintenance organization" means a health maintenance
14 organization as defined in the Health Maintenance
15 Organization Act. A "managed care community network" means
16 an entity, other than a health maintenance organization, that
17 is owned, operated, or governed by providers of health care
18 services within this State and that provides or arranges
19 primary, secondary, and tertiary managed health care services
20 under contract with the Illinois Department exclusively to
21 enrollees of the integrated health care program. A managed
22 care community network may contract with the Illinois
23 Department to provide only pediatric health care services. A
24 county provider as defined in Section 15-1 of this Code may
25 contract with the Illinois Department to provide services to
26 enrollees of the integrated health care program as a managed
27 care community network without the need to establish a
28 separate entity that provides services exclusively to
29 enrollees of the integrated health care program and shall be
30 deemed a managed care community network for purposes of this
31 Code only to the extent of the provision of services to those
32 enrollees in conjunction with the integrated health care
33 program. A county provider shall be entitled to contract
34 with the Illinois Department with respect to any contracting
-25- LRB9000968DJcd
1 region located in whole or in part within the county. A
2 county provider shall not be required to accept enrollees who
3 do not reside within the county.
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
-26- LRB9000968DJcd
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 Human Services (as successor to the
28 Department of Mental Health and Developmental Disabilities)
29 under the provisions of Title 59 of the Illinois
30 Administrative Code, Part 132 ("Medicaid Community Mental
31 Health Services Program").
32 (c) The program established by this Section may be
33 implemented by the Illinois Department in various contracting
34 areas at various times. The health care delivery systems and
-27- LRB9000968DJcd
1 providers available under the program may vary throughout the
2 State. For purposes of contracting with managed health care
3 entities and providers, the Illinois Department shall
4 establish contracting areas similar to the geographic areas
5 designated by the Illinois Department for contracting
6 purposes under the Illinois Competitive Access and
7 Reimbursement Equity Program (ICARE) under the authority of
8 Section 3-4 of the Illinois Health Finance Reform Act or
9 similarly-sized or smaller geographic areas established by
10 the Illinois Department by rule. A managed health care entity
11 shall be permitted to contract in any geographic areas for
12 which it has a sufficient provider network and otherwise
13 meets the contracting terms of the State. The Illinois
14 Department is not prohibited from entering into a contract
15 with a managed health care entity at any time.
16 (d) A managed health care entity that contracts with the
17 Illinois Department for the provision of services under the
18 program shall do all of the following, solely for purposes of
19 the integrated health care program:
20 (1) Provide that any individual physician licensed
21 to practice medicine in all its branches, any pharmacy,
22 any federally qualified health center, and any
23 podiatrist, that consistently meets the reasonable terms
24 and conditions established by the managed health care
25 entity, including but not limited to credentialing
26 standards, quality assurance program requirements,
27 utilization management requirements, financial
28 responsibility standards, contracting process
29 requirements, and provider network size and accessibility
30 requirements, must be accepted by the managed health care
31 entity for purposes of the Illinois integrated health
32 care program. Any individual who is either terminated
33 from or denied inclusion in the panel of physicians of
34 the managed health care entity shall be given, within 10
-28- LRB9000968DJcd
1 business days after that determination, a written
2 explanation of the reasons for his or her exclusion or
3 termination from the panel. This paragraph (1) does not
4 apply to the following:
5 (A) A managed health care entity that
6 certifies to the Illinois Department that:
7 (i) it employs on a full-time basis 125
8 or more Illinois physicians licensed to
9 practice medicine in all of its branches; and
10 (ii) it will provide medical services
11 through its employees to more than 80% of the
12 recipients enrolled with the entity in the
13 integrated health care program; or
14 (B) A domestic stock insurance company
15 licensed under clause (b) of class 1 of Section 4 of
16 the Illinois Insurance Code if (i) at least 66% of
17 the stock of the insurance company is owned by a
18 professional corporation organized under the
19 Professional Service Corporation Act that has 125 or
20 more shareholders who are Illinois physicians
21 licensed to practice medicine in all of its branches
22 and (ii) the insurance company certifies to the
23 Illinois Department that at least 80% of those
24 physician shareholders will provide services to
25 recipients enrolled with the company in the
26 integrated health care program.
27 (2) Provide for reimbursement for providers for
28 emergency care, as defined by the Illinois Department by
29 rule, that must be provided to its enrollees, including
30 an emergency room screening fee, and urgent care that it
31 authorizes for its enrollees, regardless of the
32 provider's affiliation with the managed health care
33 entity. Providers shall be reimbursed for emergency care
34 at an amount equal to the Illinois Department's
-29- LRB9000968DJcd
1 fee-for-service rates for those medical services rendered
2 by providers not under contract with the managed health
3 care entity to enrollees of the entity.
4 (3) Provide that any provider affiliated with a
5 managed health care entity may also provide services on a
6 fee-for-service basis to Illinois Department clients not
7 enrolled in a managed health care entity.
8 (4) Provide client education services as determined
9 and approved by the Illinois Department, including but
10 not limited to (i) education regarding appropriate
11 utilization of health care services in a managed care
12 system, (ii) written disclosure of treatment policies and
13 any restrictions or limitations on health services,
14 including, but not limited to, physical services,
15 clinical laboratory tests, hospital and surgical
16 procedures, prescription drugs and biologics, and
17 radiological examinations, and (iii) written notice that
18 the enrollee may receive from another provider those
19 services covered under this program that are not provided
20 by the managed health care entity.
21 (5) Provide that enrollees within its system may
22 choose the site for provision of services and the panel
23 of health care providers.
24 (6) Not discriminate in its enrollment or
25 disenrollment practices among recipients of medical
26 services or program enrollees based on health status.
27 (7) Provide a quality assurance and utilization
28 review program that (i) for health maintenance
29 organizations meets the requirements of the Health
30 Maintenance Organization Act and (ii) for managed care
31 community networks meets the requirements established by
32 the Illinois Department in rules that incorporate those
33 standards set forth in the Health Maintenance
34 Organization Act.
-30- LRB9000968DJcd
1 (8) Issue a managed health care entity
2 identification card to each enrollee upon enrollment.
3 The card must contain all of the following:
4 (A) The enrollee's signature.
5 (B) The enrollee's health plan.
6 (C) The name and telephone number of the
7 enrollee's primary care physician.
8 (D) A telephone number to be used for
9 emergency service 24 hours per day, 7 days per week.
10 The telephone number required to be maintained
11 pursuant to this subparagraph by each managed health
12 care entity shall, at minimum, be staffed by
13 medically trained personnel and be provided
14 directly, or under arrangement, at an office or
15 offices in locations maintained solely within the
16 State of Illinois. For purposes of this
17 subparagraph, "medically trained personnel" means
18 licensed practical nurses or registered nurses
19 located in the State of Illinois who are licensed
20 pursuant to the Illinois Nursing Act of 1987.
21 (9) Ensure that every primary care physician and
22 pharmacy in the managed health care entity meets the
23 standards established by the Illinois Department for
24 accessibility and quality of care. The Illinois
25 Department shall arrange for and oversee an evaluation of
26 the standards established under this paragraph (9) and
27 may recommend any necessary changes to these standards.
28 The Illinois Department shall submit an annual report to
29 the Governor and the General Assembly by April 1 of each
30 year regarding the effect of the standards on ensuring
31 access and quality of care to enrollees.
32 (10) Provide a procedure for handling complaints
33 that (i) for health maintenance organizations meets the
34 requirements of the Health Maintenance Organization Act
-31- LRB9000968DJcd
1 and (ii) for managed care community networks meets the
2 requirements established by the Illinois Department in
3 rules that incorporate those standards set forth in the
4 Health Maintenance Organization Act.
5 (11) Maintain, retain, and make available to the
6 Illinois Department records, data, and information, in a
7 uniform manner determined by the Illinois Department,
8 sufficient for the Illinois Department to monitor
9 utilization, accessibility, and quality of care.
10 (12) Except for providers who are prepaid, pay all
11 approved claims for covered services that are completed
12 and submitted to the managed health care entity within 30
13 days after receipt of the claim or receipt of the
14 appropriate capitation payment or payments by the managed
15 health care entity from the State for the month in which
16 the services included on the claim were rendered,
17 whichever is later. If payment is not made or mailed to
18 the provider by the managed health care entity by the due
19 date under this subsection, an interest penalty of 1% of
20 any amount unpaid shall be added for each month or
21 fraction of a month after the due date, until final
22 payment is made. Nothing in this Section shall prohibit
23 managed health care entities and providers from mutually
24 agreeing to terms that require more timely payment.
25 (13) Provide integration with community-based
26 programs provided by certified local health departments
27 such as Women, Infants, and Children Supplemental Food
28 Program (WIC), childhood immunization programs, health
29 education programs, case management programs, and health
30 screening programs.
31 (14) Provide that the pharmacy formulary used by a
32 managed health care entity and its contract providers be
33 no more restrictive than the Illinois Department's
34 pharmaceutical program on the effective date of this
-32- LRB9000968DJcd
1 amendatory Act of 1994 and as amended after that date.
2 (15) Provide integration with community-based
3 organizations, including, but not limited to, any
4 organization that has operated within a Medicaid
5 Partnership as defined by this Code or by rule of the
6 Illinois Department, that may continue to operate under a
7 contract with the Illinois Department or a managed health
8 care entity under this Section to provide case management
9 services to Medicaid clients in designated high-need
10 areas.
11 The Illinois Department may, by rule, determine
12 methodologies to limit financial liability for managed health
13 care entities resulting from payment for services to
14 enrollees provided under the Illinois Department's integrated
15 health care program. Any methodology so determined may be
16 considered or implemented by the Illinois Department through
17 a contract with a managed health care entity under this
18 integrated health care program.
19 The Illinois Department shall contract with an entity or
20 entities to provide external peer-based quality assurance
21 review for the integrated health care program. The entity
22 shall be representative of Illinois physicians licensed to
23 practice medicine in all its branches and have statewide
24 geographic representation in all specialties of medical care
25 that are provided within the integrated health care program.
26 The entity may not be a third party payer and shall maintain
27 offices in locations around the State in order to provide
28 service and continuing medical education to physician
29 participants within the integrated health care program. The
30 review process shall be developed and conducted by Illinois
31 physicians licensed to practice medicine in all its branches.
32 In consultation with the entity, the Illinois Department may
33 contract with other entities for professional peer-based
34 quality assurance review of individual categories of services
-33- LRB9000968DJcd
1 other than services provided, supervised, or coordinated by
2 physicians licensed to practice medicine in all its branches.
3 The Illinois Department shall establish, by rule, criteria to
4 avoid conflicts of interest in the conduct of quality
5 assurance activities consistent with professional peer-review
6 standards. All quality assurance activities shall be
7 coordinated by the Illinois Department.
8 (e) All persons enrolled in the program shall be
9 provided with a full written explanation of all
10 fee-for-service and managed health care plan options and a
11 reasonable opportunity to choose among the options as
12 provided by rule. The Illinois Department shall provide to
13 enrollees, upon enrollment in the integrated health care
14 program and at least annually thereafter, notice of the
15 process for requesting an appeal under the Illinois
16 Department's administrative appeal procedures.
17 Notwithstanding any other Section of this Code, the Illinois
18 Department may provide by rule for the Illinois Department to
19 assign a person enrolled in the program to a specific
20 provider of medical services or to a specific health care
21 delivery system if an enrollee has failed to exercise choice
22 in a timely manner. An enrollee assigned by the Illinois
23 Department shall be afforded the opportunity to disenroll and
24 to select a specific provider of medical services or a
25 specific health care delivery system within the first 30 days
26 after the assignment. An enrollee who has failed to exercise
27 choice in a timely manner may be assigned only if there are 3
28 or more managed health care entities contracting with the
29 Illinois Department within the contracting area, except that,
30 outside the City of Chicago, this requirement may be waived
31 for an area by rules adopted by the Illinois Department after
32 consultation with all hospitals within the contracting area.
33 The Illinois Department shall establish by rule the procedure
34 for random assignment of enrollees who fail to exercise
-34- LRB9000968DJcd
1 choice in a timely manner to a specific managed health care
2 entity in proportion to the available capacity of that
3 managed health care entity. Assignment to a specific provider
4 of medical services or to a specific managed health care
5 entity may not exceed that provider's or entity's capacity as
6 determined by the Illinois Department. Any person who has
7 chosen a specific provider of medical services or a specific
8 managed health care entity, or any person who has been
9 assigned under this subsection, shall be given the
10 opportunity to change that choice or assignment at least once
11 every 12 months, as determined by the Illinois Department by
12 rule. The Illinois Department shall maintain a toll-free
13 telephone number for program enrollees' use in reporting
14 problems with managed health care entities.
15 (f) If a person becomes eligible for participation in
16 the integrated health care program while he or she is
17 hospitalized, the Illinois Department may not enroll that
18 person in the program until after he or she has been
19 discharged from the hospital. This subsection does not apply
20 to newborn infants whose mothers are enrolled in the
21 integrated health care program.
22 (g) The Illinois Department shall, by rule, establish
23 for managed health care entities rates that (i) are certified
24 to be actuarially sound, as determined by an actuary who is
25 an associate or a fellow of the Society of Actuaries or a
26 member of the American Academy of Actuaries and who has
27 expertise and experience in medical insurance and benefit
28 programs, in accordance with the Illinois Department's
29 current fee-for-service payment system, and (ii) take into
30 account any difference of cost to provide health care to
31 different populations based on gender, age, location, and
32 eligibility category. The rates for managed health care
33 entities shall be determined on a capitated basis.
34 The Illinois Department by rule shall establish a method
-35- LRB9000968DJcd
1 to adjust its payments to managed health care entities in a
2 manner intended to avoid providing any financial incentive to
3 a managed health care entity to refer patients to a county
4 provider, in an Illinois county having a population greater
5 than 3,000,000, that is paid directly by the Illinois
6 Department. The Illinois Department shall by April 1, 1997,
7 and annually thereafter, review the method to adjust
8 payments. Payments by the Illinois Department to the county
9 provider, for persons not enrolled in a managed care
10 community network owned or operated by a county provider,
11 shall be paid on a fee-for-service basis under Article XV of
12 this Code.
13 The Illinois Department by rule shall establish a method
14 to reduce its payments to managed health care entities to
15 take into consideration (i) any adjustment payments paid to
16 hospitals under subsection (h) of this Section to the extent
17 those payments, or any part of those payments, have been
18 taken into account in establishing capitated rates under this
19 subsection (g) and (ii) the implementation of methodologies
20 to limit financial liability for managed health care entities
21 under subsection (d) of this Section.
22 (g-5) After December 31 of each year and before March 1
23 of the succeeding year, every managed health care entity that
24 participates in the integrated health care program shall file
25 a report with the Illinois Department. The report shall be
26 in the form specified by the Illinois Department. The
27 Illinois Department may specify that the report include,
28 without limitation, all salaries, wages, reimbursements,
29 benefits, and other consideration paid to the entity's
30 owners, officers, employees, and agents during the calendar
31 year just ended.
32 If a physician providing or proposing to provide medical
33 services to a managed health care entity's enrollees makes a
34 report to the Department of Professional Regulation required
-36- LRB9000968DJcd
1 under paragraph 34, 35, or 36 of Section 22 of the Medical
2 Practice Act of 1987, the managed health care entity shall
3 cause a copy of the report to be submitted to the Illinois
4 Department.
5 Every managed health care entity required to report under
6 this subsection shall keep records and books that will permit
7 verification of the information required to be reported under
8 this subsection. All such books and records shall be kept in
9 the English language and shall, at all times during business
10 hours of the day, be subject to inspection by the Illinois
11 Department or its authorized agents and employees.
12 In order to prevent profiteering by a managed health care
13 entity as a result of the entity's participation in the
14 managed health care program, the Illinois Department may, by
15 rule, establish limits on the amounts a managed health care
16 entity may pay to its owners, officers, employees, and
17 agents.
18 On or before April 1 of each year, the Illinois
19 Department shall report the following to the General
20 Assembly:
21 (1) Amounts reported paid to managed health care
22 entity owners, officers, employees, and agents, if
23 required to be reported by managed health care entities
24 under this subsection, for the preceding calendar year.
25 (2) Any limitations on amounts paid by managed
26 health care entities imposed by the Illinois Department
27 under this subsection.
28 (h) For hospital services provided by a hospital that
29 contracts with a managed health care entity, adjustment
30 payments shall be paid directly to the hospital by the
31 Illinois Department. Adjustment payments may include but
32 need not be limited to adjustment payments to:
33 disproportionate share hospitals under Section 5-5.02 of this
34 Code; primary care access health care education payments (89
-37- LRB9000968DJcd
1 Ill. Adm. Code 149.140); payments for capital, direct medical
2 education, indirect medical education, certified registered
3 nurse anesthetist, and kidney acquisition costs (89 Ill. Adm.
4 Code 149.150(c)); uncompensated care payments (89 Ill. Adm.
5 Code 148.150(h)); trauma center payments (89 Ill. Adm. Code
6 148.290(c)); rehabilitation hospital payments (89 Ill. Adm.
7 Code 148.290(d)); perinatal center payments (89 Ill. Adm.
8 Code 148.290(e)); obstetrical care payments (89 Ill. Adm.
9 Code 148.290(f)); targeted access payments (89 Ill. Adm. Code
10 148.290(g)); Medicaid high volume payments (89 Ill. Adm. Code
11 148.290(h)); and outpatient indigent volume adjustments (89
12 Ill. Adm. Code 148.140(b)(5)).
13 (i) For any hospital eligible for the adjustment
14 payments described in subsection (h), the Illinois Department
15 shall maintain, through the period ending June 30, 1995,
16 reimbursement levels in accordance with statutes and rules in
17 effect on April 1, 1994.
18 (j) Nothing contained in this Code in any way limits or
19 otherwise impairs the authority or power of the Illinois
20 Department to enter into a negotiated contract pursuant to
21 this Section with a managed health care entity, including,
22 but not limited to, a health maintenance organization, that
23 provides for termination or nonrenewal of the contract
24 without cause upon notice as provided in the contract and
25 without a hearing.
26 (k) Section 5-5.15 does not apply to the program
27 developed and implemented pursuant to this Section.
28 (l) The Illinois Department shall, by rule, define those
29 chronic or acute medical conditions of childhood that require
30 longer-term treatment and follow-up care. The Illinois
31 Department shall ensure that services required to treat these
32 conditions are available through a separate delivery system.
33 A managed health care entity that contracts with the
34 Illinois Department may refer a child with medical conditions
-38- LRB9000968DJcd
1 described in the rules adopted under this subsection directly
2 to a children's hospital or to a hospital, other than a
3 children's hospital, that is qualified to provide inpatient
4 and outpatient services to treat those conditions. The
5 Illinois Department shall provide fee-for-service
6 reimbursement directly to a children's hospital for those
7 services pursuant to Title 89 of the Illinois Administrative
8 Code, Section 148.280(a), at a rate at least equal to the
9 rate in effect on March 31, 1994. For hospitals, other than
10 children's hospitals, that are qualified to provide inpatient
11 and outpatient services to treat those conditions, the
12 Illinois Department shall provide reimbursement for those
13 services on a fee-for-service basis, at a rate at least equal
14 to the rate in effect for those other hospitals on March 31,
15 1994.
16 A children's hospital shall be directly reimbursed for
17 all services provided at the children's hospital on a
18 fee-for-service basis pursuant to Title 89 of the Illinois
19 Administrative Code, Section 148.280(a), at a rate at least
20 equal to the rate in effect on March 31, 1994, until the
21 later of (i) implementation of the integrated health care
22 program under this Section and development of actuarially
23 sound capitation rates for services other than those chronic
24 or acute medical conditions of childhood that require
25 longer-term treatment and follow-up care as defined by the
26 Illinois Department in the rules adopted under this
27 subsection or (ii) March 31, 1996.
28 Notwithstanding anything in this subsection to the
29 contrary, a managed health care entity shall not consider
30 sources or methods of payment in determining the referral of
31 a child. The Illinois Department shall adopt rules to
32 establish criteria for those referrals. The Illinois
33 Department by rule shall establish a method to adjust its
34 payments to managed health care entities in a manner intended
-39- LRB9000968DJcd
1 to avoid providing any financial incentive to a managed
2 health care entity to refer patients to a provider who is
3 paid directly by the Illinois Department.
4 (m) Behavioral health services provided or funded by the
5 Department of Human Services, the Department of Children and
6 Family Services, and the Illinois Department shall be
7 excluded from a benefit package. Conditions of an organic or
8 physical origin or nature, including medical detoxification,
9 however, may not be excluded. In this subsection,
10 "behavioral health services" means mental health services and
11 subacute alcohol and substance abuse treatment services, as
12 defined in the Illinois Alcoholism and Other Drug Dependency
13 Act. In this subsection, "mental health services" includes,
14 at a minimum, the following services funded by the Illinois
15 Department, the Department of Human Services (as successor to
16 the Department of Mental Health and Developmental
17 Disabilities), or the Department of Children and Family
18 Services: (i) inpatient hospital services, including related
19 physician services, related psychiatric interventions, and
20 pharmaceutical services provided to an eligible recipient
21 hospitalized with a primary diagnosis of psychiatric
22 disorder; (ii) outpatient mental health services as defined
23 and specified in Title 59 of the Illinois Administrative
24 Code, Part 132; (iii) any other outpatient mental health
25 services funded by the Illinois Department pursuant to the
26 State of Illinois Medicaid Plan; (iv) partial
27 hospitalization; and (v) follow-up stabilization related to
28 any of those services. Additional behavioral health services
29 may be excluded under this subsection as mutually agreed in
30 writing by the Illinois Department and the affected State
31 agency or agencies. The exclusion of any service does not
32 prohibit the Illinois Department from developing and
33 implementing demonstration projects for categories of persons
34 or services. The Department of Children and Family Services
-40- LRB9000968DJcd
1 and the Department of Human Services shall each adopt rules
2 governing the integration of managed care in the provision of
3 behavioral health services. The State shall integrate managed
4 care community networks and affiliated providers, to the
5 extent practicable, in any separate delivery system for
6 mental health services.
7 (n) The Illinois Department shall adopt rules to
8 establish reserve requirements for managed care community
9 networks, as required by subsection (a), and health
10 maintenance organizations to protect against liabilities in
11 the event that a managed health care entity is declared
12 insolvent or bankrupt. If a managed health care entity other
13 than a county provider is declared insolvent or bankrupt,
14 after liquidation and application of any available assets,
15 resources, and reserves, the Illinois Department shall pay a
16 portion of the amounts owed by the managed health care entity
17 to providers for services rendered to enrollees under the
18 integrated health care program under this Section based on
19 the following schedule: (i) from April 1, 1995 through June
20 30, 1998, 90% of the amounts owed; (ii) from July 1, 1998
21 through June 30, 2001, 80% of the amounts owed; and (iii)
22 from July 1, 2001 through June 30, 2005, 75% of the amounts
23 owed. The amounts paid under this subsection shall be
24 calculated based on the total amount owed by the managed
25 health care entity to providers before application of any
26 available assets, resources, and reserves. After June 30,
27 2005, the Illinois Department may not pay any amounts owed to
28 providers as a result of an insolvency or bankruptcy of a
29 managed health care entity occurring after that date. The
30 Illinois Department is not obligated, however, to pay amounts
31 owed to a provider that has an ownership or other governing
32 interest in the managed health care entity. This subsection
33 applies only to managed health care entities and the services
34 they provide under the integrated health care program under
-41- LRB9000968DJcd
1 this Section.
2 (o) Notwithstanding any other provision of law or
3 contractual agreement to the contrary, providers shall not be
4 required to accept from any other third party payer the rates
5 determined or paid under this Code by the Illinois
6 Department, managed health care entity, or other health care
7 delivery system for services provided to recipients.
8 (p) The Illinois Department may seek and obtain any
9 necessary authorization provided under federal law to
10 implement the program, including the waiver of any federal
11 statutes or regulations. The Illinois Department may seek a
12 waiver of the federal requirement that the combined
13 membership of Medicare and Medicaid enrollees in a managed
14 care community network may not exceed 75% of the managed care
15 community network's total enrollment. The Illinois
16 Department shall not seek a waiver of this requirement for
17 any other category of managed health care entity. The
18 Illinois Department shall not seek a waiver of the inpatient
19 hospital reimbursement methodology in Section 1902(a)(13)(A)
20 of Title XIX of the Social Security Act even if the federal
21 agency responsible for administering Title XIX determines
22 that Section 1902(a)(13)(A) applies to managed health care
23 systems.
24 Notwithstanding any other provisions of this Code to the
25 contrary, the Illinois Department shall seek a waiver of
26 applicable federal law in order to impose a co-payment system
27 consistent with this subsection on recipients of medical
28 services under Title XIX of the Social Security Act who are
29 not enrolled in a managed health care entity. The waiver
30 request submitted by the Illinois Department shall provide
31 for co-payments of up to $0.50 for prescribed drugs and up to
32 $0.50 for x-ray services and shall provide for co-payments of
33 up to $10 for non-emergency services provided in a hospital
34 emergency room and up to $10 for non-emergency ambulance
-42- LRB9000968DJcd
1 services. The purpose of the co-payments shall be to deter
2 those recipients from seeking unnecessary medical care.
3 Co-payments may not be used to deter recipients from seeking
4 necessary medical care. No recipient shall be required to
5 pay more than a total of $150 per year in co-payments under
6 the waiver request required by this subsection. A recipient
7 may not be required to pay more than $15 of any amount due
8 under this subsection in any one month.
9 Co-payments authorized under this subsection may not be
10 imposed when the care was necessitated by a true medical
11 emergency. Co-payments may not be imposed for any of the
12 following classifications of services:
13 (1) Services furnished to person under 18 years of
14 age.
15 (2) Services furnished to pregnant women.
16 (3) Services furnished to any individual who is an
17 inpatient in a hospital, nursing facility, intermediate
18 care facility, or other medical institution, if that
19 person is required to spend for costs of medical care all
20 but a minimal amount of his or her income required for
21 personal needs.
22 (4) Services furnished to a person who is receiving
23 hospice care.
24 Co-payments authorized under this subsection shall not be
25 deducted from or reduce in any way payments for medical
26 services from the Illinois Department to providers. No
27 provider may deny those services to an individual eligible
28 for services based on the individual's inability to pay the
29 co-payment.
30 Recipients who are subject to co-payments shall be
31 provided notice, in plain and clear language, of the amount
32 of the co-payments, the circumstances under which co-payments
33 are exempted, the circumstances under which co-payments may
34 be assessed, and their manner of collection.
-43- LRB9000968DJcd
1 The Illinois Department shall establish a Medicaid
2 Co-Payment Council to assist in the development of co-payment
3 policies for the medical assistance program. The Medicaid
4 Co-Payment Council shall also have jurisdiction to develop a
5 program to provide financial or non-financial incentives to
6 Medicaid recipients in order to encourage recipients to seek
7 necessary health care. The Council shall be chaired by the
8 Director of the Illinois Department, and shall have 6
9 additional members. Two of the 6 additional members shall be
10 appointed by the Governor, and one each shall be appointed by
11 the President of the Senate, the Minority Leader of the
12 Senate, the Speaker of the House of Representatives, and the
13 Minority Leader of the House of Representatives. The Council
14 may be convened and make recommendations upon the appointment
15 of a majority of its members. The Council shall be appointed
16 and convened no later than September 1, 1994 and shall report
17 its recommendations to the Director of the Illinois
18 Department and the General Assembly no later than October 1,
19 1994. The chairperson of the Council shall be allowed to
20 vote only in the case of a tie vote among the appointed
21 members of the Council.
22 The Council shall be guided by the following principles
23 as it considers recommendations to be developed to implement
24 any approved waivers that the Illinois Department must seek
25 pursuant to this subsection:
26 (1) Co-payments should not be used to deter access
27 to adequate medical care.
28 (2) Co-payments should be used to reduce fraud.
29 (3) Co-payment policies should be examined in
30 consideration of other states' experience, and the
31 ability of successful co-payment plans to control
32 unnecessary or inappropriate utilization of services
33 should be promoted.
34 (4) All participants, both recipients and
-44- LRB9000968DJcd
1 providers, in the medical assistance program have
2 responsibilities to both the State and the program.
3 (5) Co-payments are primarily a tool to educate the
4 participants in the responsible use of health care
5 resources.
6 (6) Co-payments should not be used to penalize
7 providers.
8 (7) A successful medical program requires the
9 elimination of improper utilization of medical resources.
10 The integrated health care program, or any part of that
11 program, established under this Section may not be
12 implemented if matching federal funds under Title XIX of the
13 Social Security Act are not available for administering the
14 program.
15 The Illinois Department shall submit for publication in
16 the Illinois Register the name, address, and telephone number
17 of the individual to whom a request may be directed for a
18 copy of the request for a waiver of provisions of Title XIX
19 of the Social Security Act that the Illinois Department
20 intends to submit to the Health Care Financing Administration
21 in order to implement this Section. The Illinois Department
22 shall mail a copy of that request for waiver to all
23 requestors at least 16 days before filing that request for
24 waiver with the Health Care Financing Administration.
25 (q) After the effective date of this Section, the
26 Illinois Department may take all planning and preparatory
27 action necessary to implement this Section, including, but
28 not limited to, seeking requests for proposals relating to
29 the integrated health care program created under this
30 Section.
31 (r) In order to (i) accelerate and facilitate the
32 development of integrated health care in contracting areas
33 outside counties with populations in excess of 3,000,000 and
34 counties adjacent to those counties and (ii) maintain and
-45- LRB9000968DJcd
1 sustain the high quality of education and residency programs
2 coordinated and associated with local area hospitals, the
3 Illinois Department may develop and implement a demonstration
4 program for managed care community networks owned, operated,
5 or governed by State-funded medical schools. The Illinois
6 Department shall prescribe by rule the criteria, standards,
7 and procedures for effecting this demonstration program.
8 (s) (Blank).
9 (t) On April 1, 1995 and every 6 months thereafter, the
10 Illinois Department shall report to the Governor and General
11 Assembly on the progress of the integrated health care
12 program in enrolling clients into managed health care
13 entities. The report shall indicate the capacities of the
14 managed health care entities with which the State contracts,
15 the number of clients enrolled by each contractor, the areas
16 of the State in which managed care options do not exist, and
17 the progress toward meeting the enrollment goals of the
18 integrated health care program.
19 (u) The Illinois Department may implement this Section
20 through the use of emergency rules in accordance with Section
21 5-45 of the Illinois Administrative Procedure Act. For
22 purposes of that Act, the adoption of rules to implement this
23 Section is deemed an emergency and necessary for the public
24 interest, safety, and welfare.
25 (Source: P.A. 88-554, eff. 7-26-94; 89-21, eff. 7-1-95;
26 89-507, eff. 7-1-97; 89-673, eff. 8-14-96; revised 8-26-96.)
27 Section 95. No acceleration or delay. Where this Act
28 makes changes in a statute that is represented in this Act by
29 text that is not yet or no longer in effect (for example, a
30 Section represented by multiple versions), the use of that
31 text does not accelerate or delay the taking effect of (i)
32 the changes made by this Act or (ii) provisions derived from
33 any other Public Act.
-46- LRB9000968DJcd
1 Section 99. Effective date. This Act takes effect upon
2 becoming law.