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90_HB1556
305 ILCS 5/5-16 from Ch. 23, par. 5-16
305 ILCS 5/5-16.3
Amends the Medicaid Article of the Public Aid Code. In
Sections concerning managed care and a system for integrated
health care services, provides that participating physicians
must be licensed under the Medical Practice Act (now,
licensed to practice medicine in all its branches). In
provision concerning contracts for professional peer-based
quality assurance review of individual categories of
services, deletes language requiring the Department of Public
Aid to consult with the entity providing external peer-based
quality assurance review for the integrated health care
program. Effective immediately.
LRB9003261WHmg
LRB9003261WHmg
1 AN ACT to amend the Illinois Public Aid Code by changing
2 Sections 5-16 and 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 Sections 5-16 and 5-16.3 as follows:
7 (305 ILCS 5/5-16) (from Ch. 23, par. 5-16)
8 Sec. 5-16. Managed Care. The Illinois Department may
9 develop and implement a Primary Care Sponsor System
10 consistent with the provisions of this Section. The purpose
11 of this managed care delivery system shall be to contain the
12 costs of providing medical care to Medicaid recipients by
13 having one provider responsible for managing all aspects of a
14 recipient's medical care. This managed care system shall
15 have the following characteristics:
16 (a) The Department, by rule, shall establish
17 criteria to determine which clients must participate in
18 this program;
19 (b) Providers participating in the program may be
20 paid an amount per patient per month, to be set by the
21 Illinois Department, for managing each recipient's
22 medical care;
23 (c) Providers eligible to participate in the
24 program shall be physicians licensed under the Medical
25 Practice Act of 1987 to practice medicine in all its
26 branches, and the Illinois Department may terminate a
27 provider's participation if the provider is determined to
28 have failed to comply with any applicable program
29 standard or procedure established by the Illinois
30 Department;
31 (d) Each recipient required to participate in the
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1 program must select from a panel of primary care
2 providers or networks established by the Department in
3 their communities;
4 (e) A recipient may change his designated primary
5 care provider:
6 (1) when the designated source becomes
7 unavailable, as the Illinois Department shall
8 determine by rule; or
9 (2) when the designated primary care provider
10 notifies the Illinois Department that it wishes to
11 withdraw from any obligation as primary care
12 provider; or
13 (3) in other situations, as the Illinois
14 Department shall provide by rule;
15 (f) The Illinois Department shall, by rule,
16 establish procedures for providing medical services when
17 the designated source becomes unavailable or wishes to
18 withdraw from any obligation as primary care provider
19 taking into consideration the need for emergency or
20 temporary medical assistance and ensuring that the
21 recipient has continuous and unrestricted access to
22 medical care from the date on which such unavailability
23 or withdrawal becomes effective until such time as the
24 recipient designates a primary care source;
25 (g) Only medical care services authorized by a
26 recipient's designated provider, except for emergency
27 services, services performed by a provider that is owned
28 or operated by a county and that provides non-emergency
29 services without regard to ability to pay and such other
30 services as provided by the Illinois Department, shall be
31 subject to payment by the Illinois Department. The
32 Illinois Department shall enter into an intergovernmental
33 agreement with each county that owns or operates such a
34 provider to develop and implement policies to minimize
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1 the provision of medical care services provided by county
2 owned or operated providers pursuant to the foregoing
3 exception.
4 The Illinois Department shall seek and obtain necessary
5 authorization provided under federal law to implement such a
6 program including the waiver of any federal regulations.
7 The Illinois Department may implement the amendatory
8 changes to this Section made by this amendatory Act of 1991
9 through the use of emergency rules in accordance with the
10 provisions of Section 5.02 of the Illinois Administrative
11 Procedure Act. For purposes of the Illinois Administrative
12 Procedure Act, the adoption of rules to implement the
13 amendatory changes to this Section made by this amendatory
14 Act of 1991 shall be deemed an emergency and necessary for
15 the public interest, safety and welfare.
16 The Illinois Department may establish a managed care
17 system demonstration program, on a limited basis, as
18 described in this Section. The demonstration program shall
19 terminate on June 30, 1997. Within 30 days after the end of
20 each year of the demonstration program's operation, the
21 Illinois Department shall report to the Governor and the
22 General Assembly concerning the operation of the
23 demonstration program.
24 (Source: P.A. 87-14; 88-490.)
25 (305 ILCS 5/5-16.3)
26 (Text of Section before amendment by P.A. 89-507)
27 Sec. 5-16.3. System for integrated health care services.
28 (a) It shall be the public policy of the State to adopt,
29 to the extent practicable, a health care program that
30 encourages the integration of health care services and
31 manages the health care of program enrollees while preserving
32 reasonable choice within a competitive and cost-efficient
33 environment. In furtherance of this public policy, the
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1 Illinois Department shall develop and implement an integrated
2 health care program consistent with the provisions of this
3 Section. The provisions of this Section apply only to the
4 integrated health care program created under this Section.
5 Persons enrolled in the integrated health care program, as
6 determined by the Illinois Department by rule, shall be
7 afforded a choice among health care delivery systems, which
8 shall include, but are not limited to, (i) fee for service
9 care managed by a primary care physician licensed under the
10 Medical Practice Act of 1987 to practice medicine in all its
11 branches, (ii) managed health care entities, and (iii)
12 federally qualified health centers (reimbursed according to a
13 prospective cost-reimbursement methodology) and rural health
14 clinics (reimbursed according to the Medicare methodology),
15 where available. Persons enrolled in the integrated health
16 care program also may be offered indemnity insurance plans,
17 subject to availability.
18 For purposes of this Section, a "managed health care
19 entity" means a health maintenance organization or a managed
20 care community network as defined in this Section. A "health
21 maintenance organization" means a health maintenance
22 organization as defined in the Health Maintenance
23 Organization Act. A "managed care community network" means
24 an entity, other than a health maintenance organization, that
25 is owned, operated, or governed by providers of health care
26 services within this State and that provides or arranges
27 primary, secondary, and tertiary managed health care services
28 under contract with the Illinois Department exclusively to
29 enrollees of the integrated health care program. A managed
30 care community network may contract with the Illinois
31 Department to provide only pediatric health care services. A
32 county provider as defined in Section 15-1 of this Code may
33 contract with the Illinois Department to provide services to
34 enrollees of the integrated health care program as a managed
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1 care community network without the need to establish a
2 separate entity that provides services exclusively to
3 enrollees of the integrated health care program and shall be
4 deemed a managed care community network for purposes of this
5 Code only to the extent of the provision of services to those
6 enrollees in conjunction with the integrated health care
7 program. A county provider shall be entitled to contract
8 with the Illinois Department with respect to any contracting
9 region located in whole or in part within the county. A
10 county provider shall not be required to accept enrollees who
11 do not reside within the county.
12 Each managed care community network must demonstrate its
13 ability to bear the financial risk of serving enrollees under
14 this program. The Illinois Department shall by rule adopt
15 criteria for assessing the financial soundness of each
16 managed care community network. These rules shall consider
17 the extent to which a managed care community network is
18 comprised of providers who directly render health care and
19 are located within the community in which they seek to
20 contract rather than solely arrange or finance the delivery
21 of health care. These rules shall further consider a variety
22 of risk-bearing and management techniques, including the
23 sufficiency of quality assurance and utilization management
24 programs and whether a managed care community network has
25 sufficiently demonstrated its financial solvency and net
26 worth. The Illinois Department's criteria must be based on
27 sound actuarial, financial, and accounting principles. In
28 adopting these rules, the Illinois Department shall consult
29 with the Illinois Department of Insurance. The Illinois
30 Department is responsible for monitoring compliance with
31 these rules.
32 This Section may not be implemented before the effective
33 date of these rules, the approval of any necessary federal
34 waivers, and the completion of the review of an application
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1 submitted, at least 60 days before the effective date of
2 rules adopted under this Section, to the Illinois Department
3 by a managed care community network.
4 All health care delivery systems that contract with the
5 Illinois Department under the integrated health care program
6 shall clearly recognize a health care provider's right of
7 conscience under the Right of Conscience Act. In addition to
8 the provisions of that Act, no health care delivery system
9 that contracts with the Illinois Department under the
10 integrated health care program shall be required to provide,
11 arrange for, or pay for any health care or medical service,
12 procedure, or product if that health care delivery system is
13 owned, controlled, or sponsored by or affiliated with a
14 religious institution or religious organization that finds
15 that health care or medical service, procedure, or product to
16 violate its religious and moral teachings and beliefs.
17 (b) The Illinois Department may, by rule, provide for
18 different benefit packages for different categories of
19 persons enrolled in the program. Mental health services,
20 alcohol and substance abuse services, services related to
21 children with chronic or acute conditions requiring
22 longer-term treatment and follow-up, and rehabilitation care
23 provided by a free-standing rehabilitation hospital or a
24 hospital rehabilitation unit may be excluded from a benefit
25 package if the State ensures that those services are made
26 available through a separate delivery system. An exclusion
27 does not prohibit the Illinois Department from developing and
28 implementing demonstration projects for categories of persons
29 or services. Benefit packages for persons eligible for
30 medical assistance under Articles V, VI, and XII shall be
31 based on the requirements of those Articles and shall be
32 consistent with the Title XIX of the Social Security Act.
33 Nothing in this Act shall be construed to apply to services
34 purchased by the Department of Children and Family Services
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1 and the Department of Mental Health and Developmental
2 Disabilities under the provisions of Title 59 of the Illinois
3 Administrative Code, Part 132 ("Medicaid Community Mental
4 Health Services Program").
5 (c) The program established by this Section may be
6 implemented by the Illinois Department in various contracting
7 areas at various times. The health care delivery systems and
8 providers available under the program may vary throughout the
9 State. For purposes of contracting with managed health care
10 entities and providers, the Illinois Department shall
11 establish contracting areas similar to the geographic areas
12 designated by the Illinois Department for contracting
13 purposes under the Illinois Competitive Access and
14 Reimbursement Equity Program (ICARE) under the authority of
15 Section 3-4 of the Illinois Health Finance Reform Act or
16 similarly-sized or smaller geographic areas established by
17 the Illinois Department by rule. A managed health care entity
18 shall be permitted to contract in any geographic areas for
19 which it has a sufficient provider network and otherwise
20 meets the contracting terms of the State. The Illinois
21 Department is not prohibited from entering into a contract
22 with a managed health care entity at any time.
23 (d) A managed health care entity that contracts with the
24 Illinois Department for the provision of services under the
25 program shall do all of the following, solely for purposes of
26 the integrated health care program:
27 (1) Provide that any individual physician licensed
28 under the Medical Practice Act of 1987 to practice
29 medicine in all its branches, any pharmacy, any federally
30 qualified health center, and any podiatrist, that
31 consistently meets the reasonable terms and conditions
32 established by the managed health care entity, including
33 but not limited to credentialing standards, quality
34 assurance program requirements, utilization management
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1 requirements, financial responsibility standards,
2 contracting process requirements, and provider network
3 size and accessibility requirements, must be accepted by
4 the managed health care entity for purposes of the
5 Illinois integrated health care program. Any individual
6 who is either terminated from or denied inclusion in the
7 panel of physicians of the managed health care entity
8 shall be given, within 10 business days after that
9 determination, a written explanation of the reasons for
10 his or her exclusion or termination from the panel. This
11 paragraph (1) does not apply to the following:
12 (A) A managed health care entity that
13 certifies to the Illinois Department that:
14 (i) it employs on a full-time basis 125
15 or more Illinois physicians licensed to
16 practice medicine in all of its branches; and
17 (ii) it will provide medical services
18 through its employees to more than 80% of the
19 recipients enrolled with the entity in the
20 integrated health care program; or
21 (B) A domestic stock insurance company
22 licensed under clause (b) of class 1 of Section 4 of
23 the Illinois Insurance Code if (i) at least 66% of
24 the stock of the insurance company is owned by a
25 professional corporation organized under the
26 Professional Service Corporation Act that has 125 or
27 more shareholders who are Illinois physicians
28 licensed to practice medicine in all of its branches
29 and (ii) the insurance company certifies to the
30 Illinois Department that at least 80% of those
31 physician shareholders will provide services to
32 recipients enrolled with the company in the
33 integrated health care program.
34 (2) Provide for reimbursement for providers for
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1 emergency care, as defined by the Illinois Department by
2 rule, that must be provided to its enrollees, including
3 an emergency room screening fee, and urgent care that it
4 authorizes for its enrollees, regardless of the
5 provider's affiliation with the managed health care
6 entity. Providers shall be reimbursed for emergency care
7 at an amount equal to the Illinois Department's
8 fee-for-service rates for those medical services rendered
9 by providers not under contract with the managed health
10 care entity to enrollees of the entity.
11 (3) Provide that any provider affiliated with a
12 managed health care entity may also provide services on a
13 fee-for-service basis to Illinois Department clients not
14 enrolled in a managed health care entity.
15 (4) Provide client education services as determined
16 and approved by the Illinois Department, including but
17 not limited to (i) education regarding appropriate
18 utilization of health care services in a managed care
19 system, (ii) written disclosure of treatment policies and
20 any restrictions or limitations on health services,
21 including, but not limited to, physical services,
22 clinical laboratory tests, hospital and surgical
23 procedures, prescription drugs and biologics, and
24 radiological examinations, and (iii) written notice that
25 the enrollee may receive from another provider those
26 services covered under this program that are not provided
27 by the managed health care entity.
28 (5) Provide that enrollees within its system may
29 choose the site for provision of services and the panel
30 of health care providers.
31 (6) Not discriminate in its enrollment or
32 disenrollment practices among recipients of medical
33 services or program enrollees based on health status.
34 (7) Provide a quality assurance and utilization
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1 review program that (i) for health maintenance
2 organizations meets the requirements of the Health
3 Maintenance Organization Act and (ii) for managed care
4 community networks meets the requirements established by
5 the Illinois Department in rules that incorporate those
6 standards set forth in the Health Maintenance
7 Organization Act.
8 (8) Issue a managed health care entity
9 identification card to each enrollee upon enrollment.
10 The card must contain all of the following:
11 (A) The enrollee's signature.
12 (B) The enrollee's health plan.
13 (C) The name and telephone number of the
14 enrollee's primary care physician.
15 (D) A telephone number to be used for
16 emergency service 24 hours per day, 7 days per week.
17 The telephone number required to be maintained
18 pursuant to this subparagraph by each managed health
19 care entity shall, at minimum, be staffed by
20 medically trained personnel and be provided
21 directly, or under arrangement, at an office or
22 offices in locations maintained solely within the
23 State of Illinois. For purposes of this
24 subparagraph, "medically trained personnel" means
25 licensed practical nurses or registered nurses
26 located in the State of Illinois who are licensed
27 pursuant to the Illinois Nursing Act of 1987.
28 (9) Ensure that every primary care physician and
29 pharmacy in the managed health care entity meets the
30 standards established by the Illinois Department for
31 accessibility and quality of care. The Illinois
32 Department shall arrange for and oversee an evaluation of
33 the standards established under this paragraph (9) and
34 may recommend any necessary changes to these standards.
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1 The Illinois Department shall submit an annual report to
2 the Governor and the General Assembly by April 1 of each
3 year regarding the effect of the standards on ensuring
4 access and quality of care to enrollees.
5 (10) Provide a procedure for handling complaints
6 that (i) for health maintenance organizations meets the
7 requirements of the Health Maintenance Organization Act
8 and (ii) for managed care community networks meets the
9 requirements established by the Illinois Department in
10 rules that incorporate those standards set forth in the
11 Health Maintenance Organization Act.
12 (11) Maintain, retain, and make available to the
13 Illinois Department records, data, and information, in a
14 uniform manner determined by the Illinois Department,
15 sufficient for the Illinois Department to monitor
16 utilization, accessibility, and quality of care.
17 (12) Except for providers who are prepaid, pay all
18 approved claims for covered services that are completed
19 and submitted to the managed health care entity within 30
20 days after receipt of the claim or receipt of the
21 appropriate capitation payment or payments by the managed
22 health care entity from the State for the month in which
23 the services included on the claim were rendered,
24 whichever is later. If payment is not made or mailed to
25 the provider by the managed health care entity by the due
26 date under this subsection, an interest penalty of 1% of
27 any amount unpaid shall be added for each month or
28 fraction of a month after the due date, until final
29 payment is made. Nothing in this Section shall prohibit
30 managed health care entities and providers from mutually
31 agreeing to terms that require more timely payment.
32 (13) Provide integration with community-based
33 programs provided by certified local health departments
34 such as Women, Infants, and Children Supplemental Food
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1 Program (WIC), childhood immunization programs, health
2 education programs, case management programs, and health
3 screening programs.
4 (14) Provide that the pharmacy formulary used by a
5 managed health care entity and its contract providers be
6 no more restrictive than the Illinois Department's
7 pharmaceutical program on the effective date of this
8 amendatory Act of 1994 and as amended after that date.
9 (15) Provide integration with community-based
10 organizations, including, but not limited to, any
11 organization that has operated within a Medicaid
12 Partnership as defined by this Code or by rule of the
13 Illinois Department, that may continue to operate under a
14 contract with the Illinois Department or a managed health
15 care entity under this Section to provide case management
16 services to Medicaid clients in designated high-need
17 areas.
18 The Illinois Department may, by rule, determine
19 methodologies to limit financial liability for managed health
20 care entities resulting from payment for services to
21 enrollees provided under the Illinois Department's integrated
22 health care program. Any methodology so determined may be
23 considered or implemented by the Illinois Department through
24 a contract with a managed health care entity under this
25 integrated health care program.
26 The Illinois Department shall contract with an entity or
27 entities to provide external peer-based quality assurance
28 review for the integrated health care program. One The
29 entity shall be representative of Illinois physicians
30 licensed to practice medicine in all its branches and have
31 statewide geographic representation in all specialties of
32 medical care that are provided within the integrated health
33 care program. The entity may not be a third party payer and
34 shall maintain offices in locations around the State in order
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1 to provide service and continuing medical education to
2 physician participants within the integrated health care
3 program. Its The review process shall be developed and
4 conducted by Illinois physicians licensed to practice
5 medicine in all its branches. In consultation with the
6 entity, The Illinois Department may contract with other
7 entities for professional peer-based quality assurance review
8 of individual categories of services other than services
9 provided, supervised, or coordinated by physicians licensed
10 to practice medicine in all its branches. The Illinois
11 Department shall establish, by rule, criteria to avoid
12 conflicts of interest in the conduct of quality assurance
13 activities consistent with professional peer-review
14 standards. All quality assurance activities shall be
15 coordinated by the Illinois Department.
16 (e) All persons enrolled in the program shall be
17 provided with a full written explanation of all
18 fee-for-service and managed health care plan options and a
19 reasonable opportunity to choose among the options as
20 provided by rule. The Illinois Department shall provide to
21 enrollees, upon enrollment in the integrated health care
22 program and at least annually thereafter, notice of the
23 process for requesting an appeal under the Illinois
24 Department's administrative appeal procedures.
25 Notwithstanding any other Section of this Code, the Illinois
26 Department may provide by rule for the Illinois Department to
27 assign a person enrolled in the program to a specific
28 provider of medical services or to a specific health care
29 delivery system if an enrollee has failed to exercise choice
30 in a timely manner. An enrollee assigned by the Illinois
31 Department shall be afforded the opportunity to disenroll and
32 to select a specific provider of medical services or a
33 specific health care delivery system within the first 30 days
34 after the assignment. An enrollee who has failed to exercise
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1 choice in a timely manner may be assigned only if there are 3
2 or more managed health care entities contracting with the
3 Illinois Department within the contracting area, except that,
4 outside the City of Chicago, this requirement may be waived
5 for an area by rules adopted by the Illinois Department after
6 consultation with all hospitals within the contracting area.
7 The Illinois Department shall establish by rule the procedure
8 for random assignment of enrollees who fail to exercise
9 choice in a timely manner to a specific managed health care
10 entity in proportion to the available capacity of that
11 managed health care entity. Assignment to a specific provider
12 of medical services or to a specific managed health care
13 entity may not exceed that provider's or entity's capacity as
14 determined by the Illinois Department. Any person who has
15 chosen a specific provider of medical services or a specific
16 managed health care entity, or any person who has been
17 assigned under this subsection, shall be given the
18 opportunity to change that choice or assignment at least once
19 every 12 months, as determined by the Illinois Department by
20 rule. The Illinois Department shall maintain a toll-free
21 telephone number for program enrollees' use in reporting
22 problems with managed health care entities.
23 (f) If a person becomes eligible for participation in
24 the integrated health care program while he or she is
25 hospitalized, the Illinois Department may not enroll that
26 person in the program until after he or she has been
27 discharged from the hospital. This subsection does not apply
28 to newborn infants whose mothers are enrolled in the
29 integrated health care program.
30 (g) The Illinois Department shall, by rule, establish
31 for managed health care entities rates that (i) are certified
32 to be actuarially sound, as determined by an actuary who is
33 an associate or a fellow of the Society of Actuaries or a
34 member of the American Academy of Actuaries and who has
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1 expertise and experience in medical insurance and benefit
2 programs, in accordance with the Illinois Department's
3 current fee-for-service payment system, and (ii) take into
4 account any difference of cost to provide health care to
5 different populations based on gender, age, location, and
6 eligibility category. The rates for managed health care
7 entities shall be determined on a capitated basis.
8 The Illinois Department by rule shall establish a method
9 to adjust its payments to managed health care entities in a
10 manner intended to avoid providing any financial incentive to
11 a managed health care entity to refer patients to a county
12 provider, in an Illinois county having a population greater
13 than 3,000,000, that is paid directly by the Illinois
14 Department. The Illinois Department shall by April 1, 1997,
15 and annually thereafter, review the method to adjust
16 payments. Payments by the Illinois Department to the county
17 provider, for persons not enrolled in a managed care
18 community network owned or operated by a county provider,
19 shall be paid on a fee-for-service basis under Article XV of
20 this Code.
21 The Illinois Department by rule shall establish a method
22 to reduce its payments to managed health care entities to
23 take into consideration (i) any adjustment payments paid to
24 hospitals under subsection (h) of this Section to the extent
25 those payments, or any part of those payments, have been
26 taken into account in establishing capitated rates under this
27 subsection (g) and (ii) the implementation of methodologies
28 to limit financial liability for managed health care entities
29 under subsection (d) of this Section.
30 (h) For hospital services provided by a hospital that
31 contracts with a managed health care entity, adjustment
32 payments shall be paid directly to the hospital by the
33 Illinois Department. Adjustment payments may include but
34 need not be limited to adjustment payments to:
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1 disproportionate share hospitals under Section 5-5.02 of this
2 Code; primary care access health care education payments (89
3 Ill. Adm. Code 149.140); payments for capital, direct medical
4 education, indirect medical education, certified registered
5 nurse anesthetist, and kidney acquisition costs (89 Ill. Adm.
6 Code 149.150(c)); uncompensated care payments (89 Ill. Adm.
7 Code 148.150(h)); trauma center payments (89 Ill. Adm. Code
8 148.290(c)); rehabilitation hospital payments (89 Ill. Adm.
9 Code 148.290(d)); perinatal center payments (89 Ill. Adm.
10 Code 148.290(e)); obstetrical care payments (89 Ill. Adm.
11 Code 148.290(f)); targeted access payments (89 Ill. Adm. Code
12 148.290(g)); Medicaid high volume payments (89 Ill. Adm. Code
13 148.290(h)); and outpatient indigent volume adjustments (89
14 Ill. Adm. Code 148.140(b)(5)).
15 (i) For any hospital eligible for the adjustment
16 payments described in subsection (h), the Illinois Department
17 shall maintain, through the period ending June 30, 1995,
18 reimbursement levels in accordance with statutes and rules in
19 effect on April 1, 1994.
20 (j) Nothing contained in this Code in any way limits or
21 otherwise impairs the authority or power of the Illinois
22 Department to enter into a negotiated contract pursuant to
23 this Section with a managed health care entity, including,
24 but not limited to, a health maintenance organization, that
25 provides for termination or nonrenewal of the contract
26 without cause upon notice as provided in the contract and
27 without a hearing.
28 (k) Section 5-5.15 does not apply to the program
29 developed and implemented pursuant to this Section.
30 (l) The Illinois Department shall, by rule, define those
31 chronic or acute medical conditions of childhood that require
32 longer-term treatment and follow-up care. The Illinois
33 Department shall ensure that services required to treat these
34 conditions are available through a separate delivery system.
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1 A managed health care entity that contracts with the
2 Illinois Department may refer a child with medical conditions
3 described in the rules adopted under this subsection directly
4 to a children's hospital or to a hospital, other than a
5 children's hospital, that is qualified to provide inpatient
6 and outpatient services to treat those conditions. The
7 Illinois Department shall provide fee-for-service
8 reimbursement directly to a children's hospital for those
9 services pursuant to Title 89 of the Illinois Administrative
10 Code, Section 148.280(a), at a rate at least equal to the
11 rate in effect on March 31, 1994. For hospitals, other than
12 children's hospitals, that are qualified to provide inpatient
13 and outpatient services to treat those conditions, the
14 Illinois Department shall provide reimbursement for those
15 services on a fee-for-service basis, at a rate at least equal
16 to the rate in effect for those other hospitals on March 31,
17 1994.
18 A children's hospital shall be directly reimbursed for
19 all services provided at the children's hospital on a
20 fee-for-service basis pursuant to Title 89 of the Illinois
21 Administrative Code, Section 148.280(a), at a rate at least
22 equal to the rate in effect on March 31, 1994, until the
23 later of (i) implementation of the integrated health care
24 program under this Section and development of actuarially
25 sound capitation rates for services other than those chronic
26 or acute medical conditions of childhood that require
27 longer-term treatment and follow-up care as defined by the
28 Illinois Department in the rules adopted under this
29 subsection or (ii) March 31, 1996.
30 Notwithstanding anything in this subsection to the
31 contrary, a managed health care entity shall not consider
32 sources or methods of payment in determining the referral of
33 a child. The Illinois Department shall adopt rules to
34 establish criteria for those referrals. The Illinois
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1 Department by rule shall establish a method to adjust its
2 payments to managed health care entities in a manner intended
3 to avoid providing any financial incentive to a managed
4 health care entity to refer patients to a provider who is
5 paid directly by the Illinois Department.
6 (m) Behavioral health services provided or funded by the
7 Department of Mental Health and Developmental Disabilities,
8 the Department of Alcoholism and Substance Abuse, the
9 Department of Children and Family Services, and the Illinois
10 Department shall be excluded from a benefit package.
11 Conditions of an organic or physical origin or nature,
12 including medical detoxification, however, may not be
13 excluded. In this subsection, "behavioral health services"
14 means mental health services and subacute alcohol and
15 substance abuse treatment services, as defined in the
16 Illinois Alcoholism and Other Drug Dependency Act. In this
17 subsection, "mental health services" includes, at a minimum,
18 the following services funded by the Illinois Department, the
19 Department of Mental Health and Developmental Disabilities,
20 or the Department of Children and Family Services: (i)
21 inpatient hospital services, including related physician
22 services, related psychiatric interventions, and
23 pharmaceutical services provided to an eligible recipient
24 hospitalized with a primary diagnosis of psychiatric
25 disorder; (ii) outpatient mental health services as defined
26 and specified in Title 59 of the Illinois Administrative
27 Code, Part 132; (iii) any other outpatient mental health
28 services funded by the Illinois Department pursuant to the
29 State of Illinois Medicaid Plan; (iv) partial
30 hospitalization; and (v) follow-up stabilization related to
31 any of those services. Additional behavioral health services
32 may be excluded under this subsection as mutually agreed in
33 writing by the Illinois Department and the affected State
34 agency or agencies. The exclusion of any service does not
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1 prohibit the Illinois Department from developing and
2 implementing demonstration projects for categories of persons
3 or services. The Department of Mental Health and
4 Developmental Disabilities, the Department of Children and
5 Family Services, and the Department of Alcoholism and
6 Substance Abuse shall each adopt rules governing the
7 integration of managed care in the provision of behavioral
8 health services. The State shall integrate managed care
9 community networks and affiliated providers, to the extent
10 practicable, in any separate delivery system for mental
11 health services.
12 (n) The Illinois Department shall adopt rules to
13 establish reserve requirements for managed care community
14 networks, as required by subsection (a), and health
15 maintenance organizations to protect against liabilities in
16 the event that a managed health care entity is declared
17 insolvent or bankrupt. If a managed health care entity other
18 than a county provider is declared insolvent or bankrupt,
19 after liquidation and application of any available assets,
20 resources, and reserves, the Illinois Department shall pay a
21 portion of the amounts owed by the managed health care entity
22 to providers for services rendered to enrollees under the
23 integrated health care program under this Section based on
24 the following schedule: (i) from April 1, 1995 through June
25 30, 1998, 90% of the amounts owed; (ii) from July 1, 1998
26 through June 30, 2001, 80% of the amounts owed; and (iii)
27 from July 1, 2001 through June 30, 2005, 75% of the amounts
28 owed. The amounts paid under this subsection shall be
29 calculated based on the total amount owed by the managed
30 health care entity to providers before application of any
31 available assets, resources, and reserves. After June 30,
32 2005, the Illinois Department may not pay any amounts owed to
33 providers as a result of an insolvency or bankruptcy of a
34 managed health care entity occurring after that date. The
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1 Illinois Department is not obligated, however, to pay amounts
2 owed to a provider that has an ownership or other governing
3 interest in the managed health care entity. This subsection
4 applies only to managed health care entities and the services
5 they provide under the integrated health care program under
6 this Section.
7 (o) Notwithstanding any other provision of law or
8 contractual agreement to the contrary, providers shall not be
9 required to accept from any other third party payer the rates
10 determined or paid under this Code by the Illinois
11 Department, managed health care entity, or other health care
12 delivery system for services provided to recipients.
13 (p) The Illinois Department may seek and obtain any
14 necessary authorization provided under federal law to
15 implement the program, including the waiver of any federal
16 statutes or regulations. The Illinois Department may seek a
17 waiver of the federal requirement that the combined
18 membership of Medicare and Medicaid enrollees in a managed
19 care community network may not exceed 75% of the managed care
20 community network's total enrollment. The Illinois
21 Department shall not seek a waiver of this requirement for
22 any other category of managed health care entity. The
23 Illinois Department shall not seek a waiver of the inpatient
24 hospital reimbursement methodology in Section 1902(a)(13)(A)
25 of Title XIX of the Social Security Act even if the federal
26 agency responsible for administering Title XIX determines
27 that Section 1902(a)(13)(A) applies to managed health care
28 systems.
29 Notwithstanding any other provisions of this Code to the
30 contrary, the Illinois Department shall seek a waiver of
31 applicable federal law in order to impose a co-payment system
32 consistent with this subsection on recipients of medical
33 services under Title XIX of the Social Security Act who are
34 not enrolled in a managed health care entity. The waiver
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1 request submitted by the Illinois Department shall provide
2 for co-payments of up to $0.50 for prescribed drugs and up to
3 $0.50 for x-ray services and shall provide for co-payments of
4 up to $10 for non-emergency services provided in a hospital
5 emergency room and up to $10 for non-emergency ambulance
6 services. The purpose of the co-payments shall be to deter
7 those recipients from seeking unnecessary medical care.
8 Co-payments may not be used to deter recipients from seeking
9 necessary medical care. No recipient shall be required to
10 pay more than a total of $150 per year in co-payments under
11 the waiver request required by this subsection. A recipient
12 may not be required to pay more than $15 of any amount due
13 under this subsection in any one month.
14 Co-payments authorized under this subsection may not be
15 imposed when the care was necessitated by a true medical
16 emergency. Co-payments may not be imposed for any of the
17 following classifications of services:
18 (1) Services furnished to person under 18 years of
19 age.
20 (2) Services furnished to pregnant women.
21 (3) Services furnished to any individual who is an
22 inpatient in a hospital, nursing facility, intermediate
23 care facility, or other medical institution, if that
24 person is required to spend for costs of medical care all
25 but a minimal amount of his or her income required for
26 personal needs.
27 (4) Services furnished to a person who is receiving
28 hospice care.
29 Co-payments authorized under this subsection shall not be
30 deducted from or reduce in any way payments for medical
31 services from the Illinois Department to providers. No
32 provider may deny those services to an individual eligible
33 for services based on the individual's inability to pay the
34 co-payment.
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1 Recipients who are subject to co-payments shall be
2 provided notice, in plain and clear language, of the amount
3 of the co-payments, the circumstances under which co-payments
4 are exempted, the circumstances under which co-payments may
5 be assessed, and their manner of collection.
6 The Illinois Department shall establish a Medicaid
7 Co-Payment Council to assist in the development of co-payment
8 policies for the medical assistance program. The Medicaid
9 Co-Payment Council shall also have jurisdiction to develop a
10 program to provide financial or non-financial incentives to
11 Medicaid recipients in order to encourage recipients to seek
12 necessary health care. The Council shall be chaired by the
13 Director of the Illinois Department, and shall have 6
14 additional members. Two of the 6 additional members shall be
15 appointed by the Governor, and one each shall be appointed by
16 the President of the Senate, the Minority Leader of the
17 Senate, the Speaker of the House of Representatives, and the
18 Minority Leader of the House of Representatives. The Council
19 may be convened and make recommendations upon the appointment
20 of a majority of its members. The Council shall be appointed
21 and convened no later than September 1, 1994 and shall report
22 its recommendations to the Director of the Illinois
23 Department and the General Assembly no later than October 1,
24 1994. The chairperson of the Council shall be allowed to
25 vote only in the case of a tie vote among the appointed
26 members of the Council.
27 The Council shall be guided by the following principles
28 as it considers recommendations to be developed to implement
29 any approved waivers that the Illinois Department must seek
30 pursuant to this subsection:
31 (1) Co-payments should not be used to deter access
32 to adequate medical care.
33 (2) Co-payments should be used to reduce fraud.
34 (3) Co-payment policies should be examined in
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1 consideration of other states' experience, and the
2 ability of successful co-payment plans to control
3 unnecessary or inappropriate utilization of services
4 should be promoted.
5 (4) All participants, both recipients and
6 providers, in the medical assistance program have
7 responsibilities to both the State and the program.
8 (5) Co-payments are primarily a tool to educate the
9 participants in the responsible use of health care
10 resources.
11 (6) Co-payments should not be used to penalize
12 providers.
13 (7) A successful medical program requires the
14 elimination of improper utilization of medical resources.
15 The integrated health care program, or any part of that
16 program, established under this Section may not be
17 implemented if matching federal funds under Title XIX of the
18 Social Security Act are not available for administering the
19 program.
20 The Illinois Department shall submit for publication in
21 the Illinois Register the name, address, and telephone number
22 of the individual to whom a request may be directed for a
23 copy of the request for a waiver of provisions of Title XIX
24 of the Social Security Act that the Illinois Department
25 intends to submit to the Health Care Financing Administration
26 in order to implement this Section. The Illinois Department
27 shall mail a copy of that request for waiver to all
28 requestors at least 16 days before filing that request for
29 waiver with the Health Care Financing Administration.
30 (q) After the effective date of this Section, the
31 Illinois Department may take all planning and preparatory
32 action necessary to implement this Section, including, but
33 not limited to, seeking requests for proposals relating to
34 the integrated health care program created under this
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1 Section.
2 (r) In order to (i) accelerate and facilitate the
3 development of integrated health care in contracting areas
4 outside counties with populations in excess of 3,000,000 and
5 counties adjacent to those counties and (ii) maintain and
6 sustain the high quality of education and residency programs
7 coordinated and associated with local area hospitals, the
8 Illinois Department may develop and implement a demonstration
9 program for managed care community networks owned, operated,
10 or governed by State-funded medical schools. The Illinois
11 Department shall prescribe by rule the criteria, standards,
12 and procedures for effecting this demonstration program.
13 (s) (Blank).
14 (t) On April 1, 1995 and every 6 months thereafter, the
15 Illinois Department shall report to the Governor and General
16 Assembly on the progress of the integrated health care
17 program in enrolling clients into managed health care
18 entities. The report shall indicate the capacities of the
19 managed health care entities with which the State contracts,
20 the number of clients enrolled by each contractor, the areas
21 of the State in which managed care options do not exist, and
22 the progress toward meeting the enrollment goals of the
23 integrated health care program.
24 (u) The Illinois Department may implement this Section
25 through the use of emergency rules in accordance with Section
26 5-45 of the Illinois Administrative Procedure Act. For
27 purposes of that Act, the adoption of rules to implement this
28 Section is deemed an emergency and necessary for the public
29 interest, safety, and welfare.
30 (Source: P.A. 88-554, eff. 7-26-94; 89-21, eff. 7-1-95;
31 89-673, eff. 8-14-96; revised 8-26-96.)
32 (Text of Section after amendment by P.A. 89-507)
33 Sec. 5-16.3. System for integrated health care services.
34 (a) It shall be the public policy of the State to adopt,
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1 to the extent practicable, a health care program that
2 encourages the integration of health care services and
3 manages the health care of program enrollees while preserving
4 reasonable choice within a competitive and cost-efficient
5 environment. In furtherance of this public policy, the
6 Illinois Department shall develop and implement an integrated
7 health care program consistent with the provisions of this
8 Section. The provisions of this Section apply only to the
9 integrated health care program created under this Section.
10 Persons enrolled in the integrated health care program, as
11 determined by the Illinois Department by rule, shall be
12 afforded a choice among health care delivery systems, which
13 shall include, but are not limited to, (i) fee for service
14 care managed by a primary care physician licensed under the
15 Medical Practice Act of 1987 to practice medicine in all its
16 branches, (ii) managed health care entities, and (iii)
17 federally qualified health centers (reimbursed according to a
18 prospective cost-reimbursement methodology) and rural health
19 clinics (reimbursed according to the Medicare methodology),
20 where available. Persons enrolled in the integrated health
21 care program also may be offered indemnity insurance plans,
22 subject to availability.
23 For purposes of this Section, a "managed health care
24 entity" means a health maintenance organization or a managed
25 care community network as defined in this Section. A "health
26 maintenance organization" means a health maintenance
27 organization as defined in the Health Maintenance
28 Organization Act. A "managed care community network" means
29 an entity, other than a health maintenance organization, that
30 is owned, operated, or governed by providers of health care
31 services within this State and that provides or arranges
32 primary, secondary, and tertiary managed health care services
33 under contract with the Illinois Department exclusively to
34 enrollees of the integrated health care program. A managed
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1 care community network may contract with the Illinois
2 Department to provide only pediatric health care services. A
3 county provider as defined in Section 15-1 of this Code may
4 contract with the Illinois Department to provide services to
5 enrollees of the integrated health care program as a managed
6 care community network without the need to establish a
7 separate entity that provides services exclusively to
8 enrollees of the integrated health care program and shall be
9 deemed a managed care community network for purposes of this
10 Code only to the extent of the provision of services to those
11 enrollees in conjunction with the integrated health care
12 program. A county provider shall be entitled to contract
13 with the Illinois Department with respect to any contracting
14 region located in whole or in part within the county. A
15 county provider shall not be required to accept enrollees who
16 do not reside within the county.
17 Each managed care community network must demonstrate its
18 ability to bear the financial risk of serving enrollees under
19 this program. The Illinois Department shall by rule adopt
20 criteria for assessing the financial soundness of each
21 managed care community network. These rules shall consider
22 the extent to which a managed care community network is
23 comprised of providers who directly render health care and
24 are located within the community in which they seek to
25 contract rather than solely arrange or finance the delivery
26 of health care. These rules shall further consider a variety
27 of risk-bearing and management techniques, including the
28 sufficiency of quality assurance and utilization management
29 programs and whether a managed care community network has
30 sufficiently demonstrated its financial solvency and net
31 worth. The Illinois Department's criteria must be based on
32 sound actuarial, financial, and accounting principles. In
33 adopting these rules, the Illinois Department shall consult
34 with the Illinois Department of Insurance. The Illinois
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1 Department is responsible for monitoring compliance with
2 these rules.
3 This Section may not be implemented before the effective
4 date of these rules, the approval of any necessary federal
5 waivers, and the completion of the review of an application
6 submitted, at least 60 days before the effective date of
7 rules adopted under this Section, to the Illinois Department
8 by a managed care community network.
9 All health care delivery systems that contract with the
10 Illinois Department under the integrated health care program
11 shall clearly recognize a health care provider's right of
12 conscience under the Right of Conscience Act. In addition to
13 the provisions of that Act, no health care delivery system
14 that contracts with the Illinois Department under the
15 integrated health care program shall be required to provide,
16 arrange for, or pay for any health care or medical service,
17 procedure, or product if that health care delivery system is
18 owned, controlled, or sponsored by or affiliated with a
19 religious institution or religious organization that finds
20 that health care or medical service, procedure, or product to
21 violate its religious and moral teachings and beliefs.
22 (b) The Illinois Department may, by rule, provide for
23 different benefit packages for different categories of
24 persons enrolled in the program. Mental health services,
25 alcohol and substance abuse services, services related to
26 children with chronic or acute conditions requiring
27 longer-term treatment and follow-up, and rehabilitation care
28 provided by a free-standing rehabilitation hospital or a
29 hospital rehabilitation unit may be excluded from a benefit
30 package if the State ensures that those services are made
31 available through a separate delivery system. An exclusion
32 does not prohibit the Illinois Department from developing and
33 implementing demonstration projects for categories of persons
34 or services. Benefit packages for persons eligible for
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1 medical assistance under Articles V, VI, and XII shall be
2 based on the requirements of those Articles and shall be
3 consistent with the Title XIX of the Social Security Act.
4 Nothing in this Act shall be construed to apply to services
5 purchased by the Department of Children and Family Services
6 and the Department of Human Services (as successor to the
7 Department of Mental Health and Developmental Disabilities)
8 under the provisions of Title 59 of the Illinois
9 Administrative Code, Part 132 ("Medicaid Community Mental
10 Health Services Program").
11 (c) The program established by this Section may be
12 implemented by the Illinois Department in various contracting
13 areas at various times. The health care delivery systems and
14 providers available under the program may vary throughout the
15 State. For purposes of contracting with managed health care
16 entities and providers, the Illinois Department shall
17 establish contracting areas similar to the geographic areas
18 designated by the Illinois Department for contracting
19 purposes under the Illinois Competitive Access and
20 Reimbursement Equity Program (ICARE) under the authority of
21 Section 3-4 of the Illinois Health Finance Reform Act or
22 similarly-sized or smaller geographic areas established by
23 the Illinois Department by rule. A managed health care entity
24 shall be permitted to contract in any geographic areas for
25 which it has a sufficient provider network and otherwise
26 meets the contracting terms of the State. The Illinois
27 Department is not prohibited from entering into a contract
28 with a managed health care entity at any time.
29 (d) A managed health care entity that contracts with the
30 Illinois Department for the provision of services under the
31 program shall do all of the following, solely for purposes of
32 the integrated health care program:
33 (1) Provide that any individual physician licensed
34 under the Medical Practice Act of 1987 to practice
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1 medicine in all its branches, any pharmacy, any federally
2 qualified health center, and any podiatrist, that
3 consistently meets the reasonable terms and conditions
4 established by the managed health care entity, including
5 but not limited to credentialing standards, quality
6 assurance program requirements, utilization management
7 requirements, financial responsibility standards,
8 contracting process requirements, and provider network
9 size and accessibility requirements, must be accepted by
10 the managed health care entity for purposes of the
11 Illinois integrated health care program. Any individual
12 who is either terminated from or denied inclusion in the
13 panel of physicians of the managed health care entity
14 shall be given, within 10 business days after that
15 determination, a written explanation of the reasons for
16 his or her exclusion or termination from the panel. This
17 paragraph (1) does not apply to the following:
18 (A) A managed health care entity that
19 certifies to the Illinois Department that:
20 (i) it employs on a full-time basis 125
21 or more Illinois physicians licensed to
22 practice medicine in all of its branches; and
23 (ii) it will provide medical services
24 through its employees to more than 80% of the
25 recipients enrolled with the entity in the
26 integrated health care program; or
27 (B) A domestic stock insurance company
28 licensed under clause (b) of class 1 of Section 4 of
29 the Illinois Insurance Code if (i) at least 66% of
30 the stock of the insurance company is owned by a
31 professional corporation organized under the
32 Professional Service Corporation Act that has 125 or
33 more shareholders who are Illinois physicians
34 licensed to practice medicine in all of its branches
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1 and (ii) the insurance company certifies to the
2 Illinois Department that at least 80% of those
3 physician shareholders will provide services to
4 recipients enrolled with the company in the
5 integrated health care program.
6 (2) Provide for reimbursement for providers for
7 emergency care, as defined by the Illinois Department by
8 rule, that must be provided to its enrollees, including
9 an emergency room screening fee, and urgent care that it
10 authorizes for its enrollees, regardless of the
11 provider's affiliation with the managed health care
12 entity. Providers shall be reimbursed for emergency care
13 at an amount equal to the Illinois Department's
14 fee-for-service rates for those medical services rendered
15 by providers not under contract with the managed health
16 care entity to enrollees of the entity.
17 (3) Provide that any provider affiliated with a
18 managed health care entity may also provide services on a
19 fee-for-service basis to Illinois Department clients not
20 enrolled in a managed health care entity.
21 (4) Provide client education services as determined
22 and approved by the Illinois Department, including but
23 not limited to (i) education regarding appropriate
24 utilization of health care services in a managed care
25 system, (ii) written disclosure of treatment policies and
26 any restrictions or limitations on health services,
27 including, but not limited to, physical services,
28 clinical laboratory tests, hospital and surgical
29 procedures, prescription drugs and biologics, and
30 radiological examinations, and (iii) written notice that
31 the enrollee may receive from another provider those
32 services covered under this program that are not provided
33 by the managed health care entity.
34 (5) Provide that enrollees within its system may
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1 choose the site for provision of services and the panel
2 of health care providers.
3 (6) Not discriminate in its enrollment or
4 disenrollment practices among recipients of medical
5 services or program enrollees based on health status.
6 (7) Provide a quality assurance and utilization
7 review program that (i) for health maintenance
8 organizations meets the requirements of the Health
9 Maintenance Organization Act and (ii) for managed care
10 community networks meets the requirements established by
11 the Illinois Department in rules that incorporate those
12 standards set forth in the Health Maintenance
13 Organization Act.
14 (8) Issue a managed health care entity
15 identification card to each enrollee upon enrollment.
16 The card must contain all of the following:
17 (A) The enrollee's signature.
18 (B) The enrollee's health plan.
19 (C) The name and telephone number of the
20 enrollee's primary care physician.
21 (D) A telephone number to be used for
22 emergency service 24 hours per day, 7 days per week.
23 The telephone number required to be maintained
24 pursuant to this subparagraph by each managed health
25 care entity shall, at minimum, be staffed by
26 medically trained personnel and be provided
27 directly, or under arrangement, at an office or
28 offices in locations maintained solely within the
29 State of Illinois. For purposes of this
30 subparagraph, "medically trained personnel" means
31 licensed practical nurses or registered nurses
32 located in the State of Illinois who are licensed
33 pursuant to the Illinois Nursing Act of 1987.
34 (9) Ensure that every primary care physician and
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1 pharmacy in the managed health care entity meets the
2 standards established by the Illinois Department for
3 accessibility and quality of care. The Illinois
4 Department shall arrange for and oversee an evaluation of
5 the standards established under this paragraph (9) and
6 may recommend any necessary changes to these standards.
7 The Illinois Department shall submit an annual report to
8 the Governor and the General Assembly by April 1 of each
9 year regarding the effect of the standards on ensuring
10 access and quality of care to enrollees.
11 (10) Provide a procedure for handling complaints
12 that (i) for health maintenance organizations meets the
13 requirements of the Health Maintenance Organization Act
14 and (ii) for managed care community networks meets the
15 requirements established by the Illinois Department in
16 rules that incorporate those standards set forth in the
17 Health Maintenance Organization Act.
18 (11) Maintain, retain, and make available to the
19 Illinois Department records, data, and information, in a
20 uniform manner determined by the Illinois Department,
21 sufficient for the Illinois Department to monitor
22 utilization, accessibility, and quality of care.
23 (12) Except for providers who are prepaid, pay all
24 approved claims for covered services that are completed
25 and submitted to the managed health care entity within 30
26 days after receipt of the claim or receipt of the
27 appropriate capitation payment or payments by the managed
28 health care entity from the State for the month in which
29 the services included on the claim were rendered,
30 whichever is later. If payment is not made or mailed to
31 the provider by the managed health care entity by the due
32 date under this subsection, an interest penalty of 1% of
33 any amount unpaid shall be added for each month or
34 fraction of a month after the due date, until final
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1 payment is made. Nothing in this Section shall prohibit
2 managed health care entities and providers from mutually
3 agreeing to terms that require more timely payment.
4 (13) Provide integration with community-based
5 programs provided by certified local health departments
6 such as Women, Infants, and Children Supplemental Food
7 Program (WIC), childhood immunization programs, health
8 education programs, case management programs, and health
9 screening programs.
10 (14) Provide that the pharmacy formulary used by a
11 managed health care entity and its contract providers be
12 no more restrictive than the Illinois Department's
13 pharmaceutical program on the effective date of this
14 amendatory Act of 1994 and as amended after that date.
15 (15) Provide integration with community-based
16 organizations, including, but not limited to, any
17 organization that has operated within a Medicaid
18 Partnership as defined by this Code or by rule of the
19 Illinois Department, that may continue to operate under a
20 contract with the Illinois Department or a managed health
21 care entity under this Section to provide case management
22 services to Medicaid clients in designated high-need
23 areas.
24 The Illinois Department may, by rule, determine
25 methodologies to limit financial liability for managed health
26 care entities resulting from payment for services to
27 enrollees provided under the Illinois Department's integrated
28 health care program. Any methodology so determined may be
29 considered or implemented by the Illinois Department through
30 a contract with a managed health care entity under this
31 integrated health care program.
32 The Illinois Department shall contract with an entity or
33 entities to provide external peer-based quality assurance
34 review for the integrated health care program. One The
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1 entity shall be representative of Illinois physicians
2 licensed to practice medicine in all its branches and have
3 statewide geographic representation in all specialties of
4 medical care that are provided within the integrated health
5 care program. The entity may not be a third party payer and
6 shall maintain offices in locations around the State in order
7 to provide service and continuing medical education to
8 physician participants within the integrated health care
9 program. Its The review process shall be developed and
10 conducted by Illinois physicians licensed to practice
11 medicine in all its branches. In consultation with the
12 entity, The Illinois Department may contract with other
13 entities for professional peer-based quality assurance review
14 of individual categories of services other than services
15 provided, supervised, or coordinated by physicians licensed
16 to practice medicine in all its branches. The Illinois
17 Department shall establish, by rule, criteria to avoid
18 conflicts of interest in the conduct of quality assurance
19 activities consistent with professional peer-review
20 standards. All quality assurance activities shall be
21 coordinated by the Illinois Department.
22 (e) All persons enrolled in the program shall be
23 provided with a full written explanation of all
24 fee-for-service and managed health care plan options and a
25 reasonable opportunity to choose among the options as
26 provided by rule. The Illinois Department shall provide to
27 enrollees, upon enrollment in the integrated health care
28 program and at least annually thereafter, notice of the
29 process for requesting an appeal under the Illinois
30 Department's administrative appeal procedures.
31 Notwithstanding any other Section of this Code, the Illinois
32 Department may provide by rule for the Illinois Department to
33 assign a person enrolled in the program to a specific
34 provider of medical services or to a specific health care
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1 delivery system if an enrollee has failed to exercise choice
2 in a timely manner. An enrollee assigned by the Illinois
3 Department shall be afforded the opportunity to disenroll and
4 to select a specific provider of medical services or a
5 specific health care delivery system within the first 30 days
6 after the assignment. An enrollee who has failed to exercise
7 choice in a timely manner may be assigned only if there are 3
8 or more managed health care entities contracting with the
9 Illinois Department within the contracting area, except that,
10 outside the City of Chicago, this requirement may be waived
11 for an area by rules adopted by the Illinois Department after
12 consultation with all hospitals within the contracting area.
13 The Illinois Department shall establish by rule the procedure
14 for random assignment of enrollees who fail to exercise
15 choice in a timely manner to a specific managed health care
16 entity in proportion to the available capacity of that
17 managed health care entity. Assignment to a specific provider
18 of medical services or to a specific managed health care
19 entity may not exceed that provider's or entity's capacity as
20 determined by the Illinois Department. Any person who has
21 chosen a specific provider of medical services or a specific
22 managed health care entity, or any person who has been
23 assigned under this subsection, shall be given the
24 opportunity to change that choice or assignment at least once
25 every 12 months, as determined by the Illinois Department by
26 rule. The Illinois Department shall maintain a toll-free
27 telephone number for program enrollees' use in reporting
28 problems with managed health care entities.
29 (f) If a person becomes eligible for participation in
30 the integrated health care program while he or she is
31 hospitalized, the Illinois Department may not enroll that
32 person in the program until after he or she has been
33 discharged from the hospital. This subsection does not apply
34 to newborn infants whose mothers are enrolled in the
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1 integrated health care program.
2 (g) The Illinois Department shall, by rule, establish
3 for managed health care entities rates that (i) are certified
4 to be actuarially sound, as determined by an actuary who is
5 an associate or a fellow of the Society of Actuaries or a
6 member of the American Academy of Actuaries and who has
7 expertise and experience in medical insurance and benefit
8 programs, in accordance with the Illinois Department's
9 current fee-for-service payment system, and (ii) take into
10 account any difference of cost to provide health care to
11 different populations based on gender, age, location, and
12 eligibility category. The rates for managed health care
13 entities shall be determined on a capitated basis.
14 The Illinois Department by rule shall establish a method
15 to adjust its payments to managed health care entities in a
16 manner intended to avoid providing any financial incentive to
17 a managed health care entity to refer patients to a county
18 provider, in an Illinois county having a population greater
19 than 3,000,000, that is paid directly by the Illinois
20 Department. The Illinois Department shall by April 1, 1997,
21 and annually thereafter, review the method to adjust
22 payments. Payments by the Illinois Department to the county
23 provider, for persons not enrolled in a managed care
24 community network owned or operated by a county provider,
25 shall be paid on a fee-for-service basis under Article XV of
26 this Code.
27 The Illinois Department by rule shall establish a method
28 to reduce its payments to managed health care entities to
29 take into consideration (i) any adjustment payments paid to
30 hospitals under subsection (h) of this Section to the extent
31 those payments, or any part of those payments, have been
32 taken into account in establishing capitated rates under this
33 subsection (g) and (ii) the implementation of methodologies
34 to limit financial liability for managed health care entities
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1 under subsection (d) of this Section.
2 (h) For hospital services provided by a hospital that
3 contracts with a managed health care entity, adjustment
4 payments shall be paid directly to the hospital by the
5 Illinois Department. Adjustment payments may include but
6 need not be limited to adjustment payments to:
7 disproportionate share hospitals under Section 5-5.02 of this
8 Code; primary care access health care education payments (89
9 Ill. Adm. Code 149.140); payments for capital, direct medical
10 education, indirect medical education, certified registered
11 nurse anesthetist, and kidney acquisition costs (89 Ill. Adm.
12 Code 149.150(c)); uncompensated care payments (89 Ill. Adm.
13 Code 148.150(h)); trauma center payments (89 Ill. Adm. Code
14 148.290(c)); rehabilitation hospital payments (89 Ill. Adm.
15 Code 148.290(d)); perinatal center payments (89 Ill. Adm.
16 Code 148.290(e)); obstetrical care payments (89 Ill. Adm.
17 Code 148.290(f)); targeted access payments (89 Ill. Adm. Code
18 148.290(g)); Medicaid high volume payments (89 Ill. Adm. Code
19 148.290(h)); and outpatient indigent volume adjustments (89
20 Ill. Adm. Code 148.140(b)(5)).
21 (i) For any hospital eligible for the adjustment
22 payments described in subsection (h), the Illinois Department
23 shall maintain, through the period ending June 30, 1995,
24 reimbursement levels in accordance with statutes and rules in
25 effect on April 1, 1994.
26 (j) Nothing contained in this Code in any way limits or
27 otherwise impairs the authority or power of the Illinois
28 Department to enter into a negotiated contract pursuant to
29 this Section with a managed health care entity, including,
30 but not limited to, a health maintenance organization, that
31 provides for termination or nonrenewal of the contract
32 without cause upon notice as provided in the contract and
33 without a hearing.
34 (k) Section 5-5.15 does not apply to the program
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1 developed and implemented pursuant to this Section.
2 (l) The Illinois Department shall, by rule, define those
3 chronic or acute medical conditions of childhood that require
4 longer-term treatment and follow-up care. The Illinois
5 Department shall ensure that services required to treat these
6 conditions are available through a separate delivery system.
7 A managed health care entity that contracts with the
8 Illinois Department may refer a child with medical conditions
9 described in the rules adopted under this subsection directly
10 to a children's hospital or to a hospital, other than a
11 children's hospital, that is qualified to provide inpatient
12 and outpatient services to treat those conditions. The
13 Illinois Department shall provide fee-for-service
14 reimbursement directly to a children's hospital for those
15 services pursuant to Title 89 of the Illinois Administrative
16 Code, Section 148.280(a), at a rate at least equal to the
17 rate in effect on March 31, 1994. For hospitals, other than
18 children's hospitals, that are qualified to provide inpatient
19 and outpatient services to treat those conditions, the
20 Illinois Department shall provide reimbursement for those
21 services on a fee-for-service basis, at a rate at least equal
22 to the rate in effect for those other hospitals on March 31,
23 1994.
24 A children's hospital shall be directly reimbursed for
25 all services provided at the children's hospital on a
26 fee-for-service basis pursuant to Title 89 of the Illinois
27 Administrative Code, Section 148.280(a), at a rate at least
28 equal to the rate in effect on March 31, 1994, until the
29 later of (i) implementation of the integrated health care
30 program under this Section and development of actuarially
31 sound capitation rates for services other than those chronic
32 or acute medical conditions of childhood that require
33 longer-term treatment and follow-up care as defined by the
34 Illinois Department in the rules adopted under this
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1 subsection or (ii) March 31, 1996.
2 Notwithstanding anything in this subsection to the
3 contrary, a managed health care entity shall not consider
4 sources or methods of payment in determining the referral of
5 a child. The Illinois Department shall adopt rules to
6 establish criteria for those referrals. The Illinois
7 Department by rule shall establish a method to adjust its
8 payments to managed health care entities in a manner intended
9 to avoid providing any financial incentive to a managed
10 health care entity to refer patients to a provider who is
11 paid directly by the Illinois Department.
12 (m) Behavioral health services provided or funded by the
13 Department of Human Services, the Department of Children and
14 Family Services, and the Illinois Department shall be
15 excluded from a benefit package. Conditions of an organic or
16 physical origin or nature, including medical detoxification,
17 however, may not be excluded. In this subsection,
18 "behavioral health services" means mental health services and
19 subacute alcohol and substance abuse treatment services, as
20 defined in the Illinois Alcoholism and Other Drug Dependency
21 Act. In this subsection, "mental health services" includes,
22 at a minimum, the following services funded by the Illinois
23 Department, the Department of Human Services (as successor to
24 the Department of Mental Health and Developmental
25 Disabilities), or the Department of Children and Family
26 Services: (i) inpatient hospital services, including related
27 physician services, related psychiatric interventions, and
28 pharmaceutical services provided to an eligible recipient
29 hospitalized with a primary diagnosis of psychiatric
30 disorder; (ii) outpatient mental health services as defined
31 and specified in Title 59 of the Illinois Administrative
32 Code, Part 132; (iii) any other outpatient mental health
33 services funded by the Illinois Department pursuant to the
34 State of Illinois Medicaid Plan; (iv) partial
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1 hospitalization; and (v) follow-up stabilization related to
2 any of those services. Additional behavioral health services
3 may be excluded under this subsection as mutually agreed in
4 writing by the Illinois Department and the affected State
5 agency or agencies. The exclusion of any service does not
6 prohibit the Illinois Department from developing and
7 implementing demonstration projects for categories of persons
8 or services. The Department of Children and Family Services
9 and the Department of Human Services shall each adopt rules
10 governing the integration of managed care in the provision of
11 behavioral health services. The State shall integrate managed
12 care community networks and affiliated providers, to the
13 extent practicable, in any separate delivery system for
14 mental health services.
15 (n) The Illinois Department shall adopt rules to
16 establish reserve requirements for managed care community
17 networks, as required by subsection (a), and health
18 maintenance organizations to protect against liabilities in
19 the event that a managed health care entity is declared
20 insolvent or bankrupt. If a managed health care entity other
21 than a county provider is declared insolvent or bankrupt,
22 after liquidation and application of any available assets,
23 resources, and reserves, the Illinois Department shall pay a
24 portion of the amounts owed by the managed health care entity
25 to providers for services rendered to enrollees under the
26 integrated health care program under this Section based on
27 the following schedule: (i) from April 1, 1995 through June
28 30, 1998, 90% of the amounts owed; (ii) from July 1, 1998
29 through June 30, 2001, 80% of the amounts owed; and (iii)
30 from July 1, 2001 through June 30, 2005, 75% of the amounts
31 owed. The amounts paid under this subsection shall be
32 calculated based on the total amount owed by the managed
33 health care entity to providers before application of any
34 available assets, resources, and reserves. After June 30,
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1 2005, the Illinois Department may not pay any amounts owed to
2 providers as a result of an insolvency or bankruptcy of a
3 managed health care entity occurring after that date. The
4 Illinois Department is not obligated, however, to pay amounts
5 owed to a provider that has an ownership or other governing
6 interest in the managed health care entity. This subsection
7 applies only to managed health care entities and the services
8 they provide under the integrated health care program under
9 this Section.
10 (o) Notwithstanding any other provision of law or
11 contractual agreement to the contrary, providers shall not be
12 required to accept from any other third party payer the rates
13 determined or paid under this Code by the Illinois
14 Department, managed health care entity, or other health care
15 delivery system for services provided to recipients.
16 (p) The Illinois Department may seek and obtain any
17 necessary authorization provided under federal law to
18 implement the program, including the waiver of any federal
19 statutes or regulations. The Illinois Department may seek a
20 waiver of the federal requirement that the combined
21 membership of Medicare and Medicaid enrollees in a managed
22 care community network may not exceed 75% of the managed care
23 community network's total enrollment. The Illinois
24 Department shall not seek a waiver of this requirement for
25 any other category of managed health care entity. The
26 Illinois Department shall not seek a waiver of the inpatient
27 hospital reimbursement methodology in Section 1902(a)(13)(A)
28 of Title XIX of the Social Security Act even if the federal
29 agency responsible for administering Title XIX determines
30 that Section 1902(a)(13)(A) applies to managed health care
31 systems.
32 Notwithstanding any other provisions of this Code to the
33 contrary, the Illinois Department shall seek a waiver of
34 applicable federal law in order to impose a co-payment system
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1 consistent with this subsection on recipients of medical
2 services under Title XIX of the Social Security Act who are
3 not enrolled in a managed health care entity. The waiver
4 request submitted by the Illinois Department shall provide
5 for co-payments of up to $0.50 for prescribed drugs and up to
6 $0.50 for x-ray services and shall provide for co-payments of
7 up to $10 for non-emergency services provided in a hospital
8 emergency room and up to $10 for non-emergency ambulance
9 services. The purpose of the co-payments shall be to deter
10 those recipients from seeking unnecessary medical care.
11 Co-payments may not be used to deter recipients from seeking
12 necessary medical care. No recipient shall be required to
13 pay more than a total of $150 per year in co-payments under
14 the waiver request required by this subsection. A recipient
15 may not be required to pay more than $15 of any amount due
16 under this subsection in any one month.
17 Co-payments authorized under this subsection may not be
18 imposed when the care was necessitated by a true medical
19 emergency. Co-payments may not be imposed for any of the
20 following classifications of services:
21 (1) Services furnished to person under 18 years of
22 age.
23 (2) Services furnished to pregnant women.
24 (3) Services furnished to any individual who is an
25 inpatient in a hospital, nursing facility, intermediate
26 care facility, or other medical institution, if that
27 person is required to spend for costs of medical care all
28 but a minimal amount of his or her income required for
29 personal needs.
30 (4) Services furnished to a person who is receiving
31 hospice care.
32 Co-payments authorized under this subsection shall not be
33 deducted from or reduce in any way payments for medical
34 services from the Illinois Department to providers. No
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1 provider may deny those services to an individual eligible
2 for services based on the individual's inability to pay the
3 co-payment.
4 Recipients who are subject to co-payments shall be
5 provided notice, in plain and clear language, of the amount
6 of the co-payments, the circumstances under which co-payments
7 are exempted, the circumstances under which co-payments may
8 be assessed, and their manner of collection.
9 The Illinois Department shall establish a Medicaid
10 Co-Payment Council to assist in the development of co-payment
11 policies for the medical assistance program. The Medicaid
12 Co-Payment Council shall also have jurisdiction to develop a
13 program to provide financial or non-financial incentives to
14 Medicaid recipients in order to encourage recipients to seek
15 necessary health care. The Council shall be chaired by the
16 Director of the Illinois Department, and shall have 6
17 additional members. Two of the 6 additional members shall be
18 appointed by the Governor, and one each shall be appointed by
19 the President of the Senate, the Minority Leader of the
20 Senate, the Speaker of the House of Representatives, and the
21 Minority Leader of the House of Representatives. The Council
22 may be convened and make recommendations upon the appointment
23 of a majority of its members. The Council shall be appointed
24 and convened no later than September 1, 1994 and shall report
25 its recommendations to the Director of the Illinois
26 Department and the General Assembly no later than October 1,
27 1994. The chairperson of the Council shall be allowed to
28 vote only in the case of a tie vote among the appointed
29 members of the Council.
30 The Council shall be guided by the following principles
31 as it considers recommendations to be developed to implement
32 any approved waivers that the Illinois Department must seek
33 pursuant to this subsection:
34 (1) Co-payments should not be used to deter access
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1 to adequate medical care.
2 (2) Co-payments should be used to reduce fraud.
3 (3) Co-payment policies should be examined in
4 consideration of other states' experience, and the
5 ability of successful co-payment plans to control
6 unnecessary or inappropriate utilization of services
7 should be promoted.
8 (4) All participants, both recipients and
9 providers, in the medical assistance program have
10 responsibilities to both the State and the program.
11 (5) Co-payments are primarily a tool to educate the
12 participants in the responsible use of health care
13 resources.
14 (6) Co-payments should not be used to penalize
15 providers.
16 (7) A successful medical program requires the
17 elimination of improper utilization of medical resources.
18 The integrated health care program, or any part of that
19 program, established under this Section may not be
20 implemented if matching federal funds under Title XIX of the
21 Social Security Act are not available for administering the
22 program.
23 The Illinois Department shall submit for publication in
24 the Illinois Register the name, address, and telephone number
25 of the individual to whom a request may be directed for a
26 copy of the request for a waiver of provisions of Title XIX
27 of the Social Security Act that the Illinois Department
28 intends to submit to the Health Care Financing Administration
29 in order to implement this Section. The Illinois Department
30 shall mail a copy of that request for waiver to all
31 requestors at least 16 days before filing that request for
32 waiver with the Health Care Financing Administration.
33 (q) After the effective date of this Section, the
34 Illinois Department may take all planning and preparatory
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1 action necessary to implement this Section, including, but
2 not limited to, seeking requests for proposals relating to
3 the integrated health care program created under this
4 Section.
5 (r) In order to (i) accelerate and facilitate the
6 development of integrated health care in contracting areas
7 outside counties with populations in excess of 3,000,000 and
8 counties adjacent to those counties and (ii) maintain and
9 sustain the high quality of education and residency programs
10 coordinated and associated with local area hospitals, the
11 Illinois Department may develop and implement a demonstration
12 program for managed care community networks owned, operated,
13 or governed by State-funded medical schools. The Illinois
14 Department shall prescribe by rule the criteria, standards,
15 and procedures for effecting this demonstration program.
16 (s) (Blank).
17 (t) On April 1, 1995 and every 6 months thereafter, the
18 Illinois Department shall report to the Governor and General
19 Assembly on the progress of the integrated health care
20 program in enrolling clients into managed health care
21 entities. The report shall indicate the capacities of the
22 managed health care entities with which the State contracts,
23 the number of clients enrolled by each contractor, the areas
24 of the State in which managed care options do not exist, and
25 the progress toward meeting the enrollment goals of the
26 integrated health care program.
27 (u) The Illinois Department may implement this Section
28 through the use of emergency rules in accordance with Section
29 5-45 of the Illinois Administrative Procedure Act. For
30 purposes of that Act, the adoption of rules to implement this
31 Section is deemed an emergency and necessary for the public
32 interest, safety, and welfare.
33 (Source: P.A. 88-554, eff. 7-26-94; 89-21, eff. 7-1-95;
34 89-507, eff. 7-1-97; 89-673, eff. 8-14-96; revised 8-26-96.)
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1 Section 95. No acceleration or delay. Where this Act
2 makes changes in a statute that is represented in this Act by
3 text that is not yet or no longer in effect (for example, a
4 Section represented by multiple versions), the use of that
5 text does not accelerate or delay the taking effect of (i)
6 the changes made by this Act or (ii) provisions derived from
7 any other Public Act.
8 Section 99. Effective date. This Act takes effect upon
9 becoming law.