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90_SB0699
305 ILCS 5/5-16.3
Amends the Medical Assistance Article of the Illinois
Public Aid Code. Removes from the managed care provisions
language allowing for a separate delivery system for
behavioral health systems, alcohol and substance abuse
services, services related to children with chronic or acute
conditions, and rehabilitation care provided by a
freestanding rehabilitation hospital or a hospital
rehabilitation unit. Effective immediately.
LRB9003258SMcw
LRB9003258SMcw
1 AN ACT to amend the Illinois Public Aid Code by changing
2 Section 5-16.3.
3 Be it enacted by the People of the State of Illinois,
4 represented in the General Assembly:
5 Section 5. The Illinois Public Aid Code is amended by
6 changing Section 5-16.3 as follows:
7 (305 ILCS 5/5-16.3)
8 (Text of Section before amendment by P.A. 89-507)
9 Sec. 5-16.3. System for integrated health care services.
10 (a) It shall be the public policy of the State to adopt,
11 to the extent practicable, a health care program that
12 encourages the integration of health care services and
13 manages the health care of program enrollees while preserving
14 reasonable choice within a competitive and cost-efficient
15 environment. In furtherance of this public policy, the
16 Illinois Department shall develop and implement an integrated
17 health care program consistent with the provisions of this
18 Section. The provisions of this Section apply only to the
19 integrated health care program created under this Section.
20 Persons enrolled in the integrated health care program, as
21 determined by the Illinois Department by rule, shall be
22 afforded a choice among health care delivery systems, which
23 shall include, but are not limited to, (i) fee for service
24 care managed by a primary care physician licensed to practice
25 medicine in all its branches, (ii) managed health care
26 entities, and (iii) federally qualified health centers
27 (reimbursed according to a prospective cost-reimbursement
28 methodology) and rural health clinics (reimbursed according
29 to the Medicare methodology), where available. Persons
30 enrolled in the integrated health care program also may be
31 offered indemnity insurance plans, subject to availability.
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1 For purposes of this Section, a "managed health care
2 entity" means a health maintenance organization or a managed
3 care community network as defined in this Section. A "health
4 maintenance organization" means a health maintenance
5 organization as defined in the Health Maintenance
6 Organization Act. A "managed care community network" means
7 an entity, other than a health maintenance organization, that
8 is owned, operated, or governed by providers of health care
9 services within this State and that provides or arranges
10 primary, secondary, and tertiary managed health care services
11 under contract with the Illinois Department exclusively to
12 enrollees of the integrated health care program. A managed
13 care community network may contract with the Illinois
14 Department to provide only pediatric health care services. A
15 county provider as defined in Section 15-1 of this Code may
16 contract with the Illinois Department to provide services to
17 enrollees of the integrated health care program as a managed
18 care community network without the need to establish a
19 separate entity that provides services exclusively to
20 enrollees of the integrated health care program and shall be
21 deemed a managed care community network for purposes of this
22 Code only to the extent of the provision of services to those
23 enrollees in conjunction with the integrated health care
24 program. A county provider shall be entitled to contract
25 with the Illinois Department with respect to any contracting
26 region located in whole or in part within the county. A
27 county provider shall not be required to accept enrollees who
28 do not reside within the county.
29 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
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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) (Blank.) The Illinois Department may, by rule,
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1 provide for different benefit packages for different
2 categories of persons enrolled in the program. Mental health
3 services, alcohol and substance abuse services, services
4 related to children with chronic or acute conditions
5 requiring longer-term treatment and follow-up, and
6 rehabilitation care provided by a free-standing
7 rehabilitation hospital or a hospital rehabilitation unit may
8 be excluded from a benefit package if the State ensures that
9 those services are made available through a separate delivery
10 system. An exclusion does not prohibit the Illinois
11 Department from developing and implementing demonstration
12 projects for categories of persons or services. Benefit
13 packages for persons eligible for medical assistance under
14 Articles V, VI, and XII shall be based on the requirements of
15 those Articles and shall be consistent with the Title XIX of
16 the Social Security Act. Nothing in this Act shall be
17 construed to apply to services purchased by the Department of
18 Children and Family Services and the Department of Mental
19 Health and Developmental Disabilities under the provisions of
20 Title 59 of the Illinois Administrative Code, Part 132
21 ("Medicaid Community Mental 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
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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
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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
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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
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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
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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.
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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
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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
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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,
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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 (h) For hospital services provided by a hospital that
13 contracts with a managed health care entity, adjustment
14 payments shall be paid directly to the hospital by the
15 Illinois Department. Adjustment payments may include but
16 need not be limited to adjustment payments to:
17 disproportionate share hospitals under Section 5-5.02 of this
18 Code; primary care access health care education payments (89
19 Ill. Adm. Code 149.140); payments for capital, direct medical
20 education, indirect medical education, certified registered
21 nurse anesthetist, and kidney acquisition costs (89 Ill. Adm.
22 Code 149.150(c)); uncompensated care payments (89 Ill. Adm.
23 Code 148.150(h)); trauma center payments (89 Ill. Adm. Code
24 148.290(c)); rehabilitation hospital payments (89 Ill. Adm.
25 Code 148.290(d)); perinatal center payments (89 Ill. Adm.
26 Code 148.290(e)); obstetrical care payments (89 Ill. Adm.
27 Code 148.290(f)); targeted access payments (89 Ill. Adm. Code
28 148.290(g)); Medicaid high volume payments (89 Ill. Adm. Code
29 148.290(h)); and outpatient indigent volume adjustments (89
30 Ill. Adm. Code 148.140(b)(5)).
31 (i) For any hospital eligible for the adjustment
32 payments described in subsection (h), the Illinois Department
33 shall maintain, through the period ending June 30, 1995,
34 reimbursement levels in accordance with statutes and rules in
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1 effect on April 1, 1994.
2 (j) Nothing contained in this Code in any way limits or
3 otherwise impairs the authority or power of the Illinois
4 Department to enter into a negotiated contract pursuant to
5 this Section with a managed health care entity, including,
6 but not limited to, a health maintenance organization, that
7 provides for termination or nonrenewal of the contract
8 without cause upon notice as provided in the contract and
9 without a hearing.
10 (k) Section 5-5.15 does not apply to the program
11 developed and implemented pursuant to this Section.
12 (l) (Blank.) The Illinois Department shall, by rule,
13 define those chronic or acute medical conditions of childhood
14 that require longer-term treatment and follow-up care. The
15 Illinois Department shall ensure that services required to
16 treat these conditions are available through a separate
17 delivery system.
18 A managed health care entity that contracts with the
19 Illinois Department may refer a child with medical conditions
20 described in the rules adopted under this subsection directly
21 to a children's hospital or to a hospital, other than a
22 children's hospital, that is qualified to provide inpatient
23 and outpatient services to treat those conditions. The
24 Illinois Department shall provide fee-for-service
25 reimbursement directly to a children's hospital for those
26 services pursuant to Title 89 of the Illinois Administrative
27 Code, Section 148.280(a), at a rate at least equal to the
28 rate in effect on March 31, 1994. For hospitals, other than
29 children's hospitals, that are qualified to provide inpatient
30 and outpatient services to treat those conditions, the
31 Illinois Department shall provide reimbursement for those
32 services on a fee-for-service basis, at a rate at least equal
33 to the rate in effect for those other hospitals on March 31,
34 1994.
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1 A children's hospital shall be directly reimbursed for
2 all services provided at the children's hospital on a
3 fee-for-service basis pursuant to Title 89 of the Illinois
4 Administrative Code, Section 148.280(a), at a rate at least
5 equal to the rate in effect on March 31, 1994, until the
6 later of (i) implementation of the integrated health care
7 program under this Section and development of actuarially
8 sound capitation rates for services other than those chronic
9 or acute medical conditions of childhood that require
10 longer-term treatment and follow-up care as defined by the
11 Illinois Department in the rules adopted under this
12 subsection or (ii) March 31, 1996.
13 Notwithstanding anything in this subsection to the
14 contrary, a managed health care entity shall not consider
15 sources or methods of payment in determining the referral of
16 a child. The Illinois Department shall adopt rules to
17 establish criteria for those referrals. The Illinois
18 Department by rule shall establish a method to adjust its
19 payments to managed health care entities in a manner intended
20 to avoid providing any financial incentive to a managed
21 health care entity to refer patients to a provider who is
22 paid directly by the Illinois Department.
23 (m) Blank.) Behavioral health services provided or
24 funded by the Department of Mental Health and Developmental
25 Disabilities, the Department of Alcoholism and Substance
26 Abuse, the Department of Children and Family Services, and
27 the Illinois Department shall be excluded from a benefit
28 package. Conditions of an organic or physical origin or
29 nature, including medical detoxification, however, may not be
30 excluded. In this subsection, "behavioral health services"
31 means mental health services and subacute alcohol and
32 substance abuse treatment services, as defined in the
33 Illinois Alcoholism and Other Drug Dependency Act. In this
34 subsection, "mental health services" includes, at a minimum,
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1 the following services funded by the Illinois Department, the
2 Department of Mental Health and Developmental Disabilities,
3 or the Department of Children and Family Services: (i)
4 inpatient hospital services, including related physician
5 services, related psychiatric interventions, and
6 pharmaceutical services provided to an eligible recipient
7 hospitalized with a primary diagnosis of psychiatric
8 disorder; (ii) outpatient mental health services as defined
9 and specified in Title 59 of the Illinois Administrative
10 Code, Part 132; (iii) any other outpatient mental health
11 services funded by the Illinois Department pursuant to the
12 State of Illinois Medicaid Plan; (iv) partial
13 hospitalization; and (v) follow-up stabilization related to
14 any of those services. Additional behavioral health services
15 may be excluded under this subsection as mutually agreed in
16 writing by the Illinois Department and the affected State
17 agency or agencies. The exclusion of any service does not
18 prohibit the Illinois Department from developing and
19 implementing demonstration projects for categories of persons
20 or services. The Department of Mental Health and
21 Developmental Disabilities, the Department of Children and
22 Family Services, and the Department of Alcoholism and
23 Substance Abuse shall each adopt rules governing the
24 integration of managed care in the provision of behavioral
25 health services. The State shall integrate managed care
26 community networks and affiliated providers, to the extent
27 practicable, in any separate delivery system for mental
28 health services.
29 (n) The Illinois Department shall adopt rules to
30 establish reserve requirements for managed care community
31 networks, as required by subsection (a), and health
32 maintenance organizations to protect against liabilities in
33 the event that a managed health care entity is declared
34 insolvent or bankrupt. If a managed health care entity other
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1 than a county provider is declared insolvent or bankrupt,
2 after liquidation and application of any available assets,
3 resources, and reserves, the Illinois Department shall pay a
4 portion of the amounts owed by the managed health care entity
5 to providers for services rendered to enrollees under the
6 integrated health care program under this Section based on
7 the following schedule: (i) from April 1, 1995 through June
8 30, 1998, 90% of the amounts owed; (ii) from July 1, 1998
9 through June 30, 2001, 80% of the amounts owed; and (iii)
10 from July 1, 2001 through June 30, 2005, 75% of the amounts
11 owed. The amounts paid under this subsection shall be
12 calculated based on the total amount owed by the managed
13 health care entity to providers before application of any
14 available assets, resources, and reserves. After June 30,
15 2005, the Illinois Department may not pay any amounts owed to
16 providers as a result of an insolvency or bankruptcy of a
17 managed health care entity occurring after that date. The
18 Illinois Department is not obligated, however, to pay amounts
19 owed to a provider that has an ownership or other governing
20 interest in the managed health care entity. This subsection
21 applies only to managed health care entities and the services
22 they provide under the integrated health care program under
23 this Section.
24 (o) Notwithstanding any other provision of law or
25 contractual agreement to the contrary, providers shall not be
26 required to accept from any other third party payer the rates
27 determined or paid under this Code by the Illinois
28 Department, managed health care entity, or other health care
29 delivery system for services provided to recipients.
30 (p) The Illinois Department may seek and obtain any
31 necessary authorization provided under federal law to
32 implement the program, including the waiver of any federal
33 statutes or regulations. The Illinois Department may seek a
34 waiver of the federal requirement that the combined
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1 membership of Medicare and Medicaid enrollees in a managed
2 care community network may not exceed 75% of the managed care
3 community network's total enrollment. The Illinois
4 Department shall not seek a waiver of this requirement for
5 any other category of managed health care entity. The
6 Illinois Department shall not seek a waiver of the inpatient
7 hospital reimbursement methodology in Section 1902(a)(13)(A)
8 of Title XIX of the Social Security Act even if the federal
9 agency responsible for administering Title XIX determines
10 that Section 1902(a)(13)(A) applies to managed health care
11 systems.
12 Notwithstanding any other provisions of this Code to the
13 contrary, the Illinois Department shall seek a waiver of
14 applicable federal law in order to impose a co-payment system
15 consistent with this subsection on recipients of medical
16 services under Title XIX of the Social Security Act who are
17 not enrolled in a managed health care entity. The waiver
18 request submitted by the Illinois Department shall provide
19 for co-payments of up to $0.50 for prescribed drugs and up to
20 $0.50 for x-ray services and shall provide for co-payments of
21 up to $10 for non-emergency services provided in a hospital
22 emergency room and up to $10 for non-emergency ambulance
23 services. The purpose of the co-payments shall be to deter
24 those recipients from seeking unnecessary medical care.
25 Co-payments may not be used to deter recipients from seeking
26 necessary medical care. No recipient shall be required to
27 pay more than a total of $150 per year in co-payments under
28 the waiver request required by this subsection. A recipient
29 may not be required to pay more than $15 of any amount due
30 under this subsection in any one month.
31 Co-payments authorized under this subsection may not be
32 imposed when the care was necessitated by a true medical
33 emergency. Co-payments may not be imposed for any of the
34 following classifications of services:
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1 (1) Services furnished to person under 18 years of
2 age.
3 (2) Services furnished to pregnant women.
4 (3) Services furnished to any individual who is an
5 inpatient in a hospital, nursing facility, intermediate
6 care facility, or other medical institution, if that
7 person is required to spend for costs of medical care all
8 but a minimal amount of his or her income required for
9 personal needs.
10 (4) Services furnished to a person who is receiving
11 hospice care.
12 Co-payments authorized under this subsection shall not be
13 deducted from or reduce in any way payments for medical
14 services from the Illinois Department to providers. No
15 provider may deny those services to an individual eligible
16 for services based on the individual's inability to pay the
17 co-payment.
18 Recipients who are subject to co-payments shall be
19 provided notice, in plain and clear language, of the amount
20 of the co-payments, the circumstances under which co-payments
21 are exempted, the circumstances under which co-payments may
22 be assessed, and their manner of collection.
23 The Illinois Department shall establish a Medicaid
24 Co-Payment Council to assist in the development of co-payment
25 policies for the medical assistance program. The Medicaid
26 Co-Payment Council shall also have jurisdiction to develop a
27 program to provide financial or non-financial incentives to
28 Medicaid recipients in order to encourage recipients to seek
29 necessary health care. The Council shall be chaired by the
30 Director of the Illinois Department, and shall have 6
31 additional members. Two of the 6 additional members shall be
32 appointed by the Governor, and one each shall be appointed by
33 the President of the Senate, the Minority Leader of the
34 Senate, the Speaker of the House of Representatives, and the
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1 Minority Leader of the House of Representatives. The Council
2 may be convened and make recommendations upon the appointment
3 of a majority of its members. The Council shall be appointed
4 and convened no later than September 1, 1994 and shall report
5 its recommendations to the Director of the Illinois
6 Department and the General Assembly no later than October 1,
7 1994. The chairperson of the Council shall be allowed to
8 vote only in the case of a tie vote among the appointed
9 members of the Council.
10 The Council shall be guided by the following principles
11 as it considers recommendations to be developed to implement
12 any approved waivers that the Illinois Department must seek
13 pursuant to this subsection:
14 (1) Co-payments should not be used to deter access
15 to adequate medical care.
16 (2) Co-payments should be used to reduce fraud.
17 (3) Co-payment policies should be examined in
18 consideration of other states' experience, and the
19 ability of successful co-payment plans to control
20 unnecessary or inappropriate utilization of services
21 should be promoted.
22 (4) All participants, both recipients and
23 providers, in the medical assistance program have
24 responsibilities to both the State and the program.
25 (5) Co-payments are primarily a tool to educate the
26 participants in the responsible use of health care
27 resources.
28 (6) Co-payments should not be used to penalize
29 providers.
30 (7) A successful medical program requires the
31 elimination of improper utilization of medical resources.
32 The integrated health care program, or any part of that
33 program, established under this Section may not be
34 implemented if matching federal funds under Title XIX of the
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1 Social Security Act are not available for administering the
2 program.
3 The Illinois Department shall submit for publication in
4 the Illinois Register the name, address, and telephone number
5 of the individual to whom a request may be directed for a
6 copy of the request for a waiver of provisions of Title XIX
7 of the Social Security Act that the Illinois Department
8 intends to submit to the Health Care Financing Administration
9 in order to implement this Section. The Illinois Department
10 shall mail a copy of that request for waiver to all
11 requestors at least 16 days before filing that request for
12 waiver with the Health Care Financing Administration.
13 (q) After the effective date of this Section, the
14 Illinois Department may take all planning and preparatory
15 action necessary to implement this Section, including, but
16 not limited to, seeking requests for proposals relating to
17 the integrated health care program created under this
18 Section.
19 (r) In order to (i) accelerate and facilitate the
20 development of integrated health care in contracting areas
21 outside counties with populations in excess of 3,000,000 and
22 counties adjacent to those counties and (ii) maintain and
23 sustain the high quality of education and residency programs
24 coordinated and associated with local area hospitals, the
25 Illinois Department may develop and implement a demonstration
26 program for managed care community networks owned, operated,
27 or governed by State-funded medical schools. The Illinois
28 Department shall prescribe by rule the criteria, standards,
29 and procedures for effecting this demonstration program.
30 (s) (Blank).
31 (t) On April 1, 1995 and every 6 months thereafter, the
32 Illinois Department shall report to the Governor and General
33 Assembly on the progress of the integrated health care
34 program in enrolling clients into managed health care
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1 entities. The report shall indicate the capacities of the
2 managed health care entities with which the State contracts,
3 the number of clients enrolled by each contractor, the areas
4 of the State in which managed care options do not exist, and
5 the progress toward meeting the enrollment goals of the
6 integrated health care program.
7 (u) The Illinois Department may implement this Section
8 through the use of emergency rules in accordance with Section
9 5-45 of the Illinois Administrative Procedure Act. For
10 purposes of that Act, the adoption of rules to implement this
11 Section is deemed an emergency and necessary for the public
12 interest, safety, and welfare.
13 (Source: P.A. 88-554, eff. 7-26-94; 89-21, eff. 7-1-95;
14 89-673, eff. 8-14-96; revised 8-26-96.)
15 (Text of Section after amendment by P.A. 89-507)
16 Sec. 5-16.3. System for integrated health care services.
17 (a) It shall be the public policy of the State to adopt,
18 to the extent practicable, a health care program that
19 encourages the integration of health care services and
20 manages the health care of program enrollees while preserving
21 reasonable choice within a competitive and cost-efficient
22 environment. In furtherance of this public policy, the
23 Illinois Department shall develop and implement an integrated
24 health care program consistent with the provisions of this
25 Section. The provisions of this Section apply only to the
26 integrated health care program created under this Section.
27 Persons enrolled in the integrated health care program, as
28 determined by the Illinois Department by rule, shall be
29 afforded a choice among health care delivery systems, which
30 shall include, but are not limited to, (i) fee for service
31 care managed by a primary care physician licensed to practice
32 medicine in all its branches, (ii) managed health care
33 entities, and (iii) federally qualified health centers
34 (reimbursed according to a prospective cost-reimbursement
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1 methodology) and rural health clinics (reimbursed according
2 to the Medicare methodology), where available. Persons
3 enrolled in the integrated health care program also may be
4 offered indemnity insurance plans, subject to availability.
5 For purposes of this Section, a "managed health care
6 entity" means a health maintenance organization or a managed
7 care community network as defined in this Section. A "health
8 maintenance organization" means a health maintenance
9 organization as defined in the Health Maintenance
10 Organization Act. A "managed care community network" means
11 an entity, other than a health maintenance organization, that
12 is owned, operated, or governed by providers of health care
13 services within this State and that provides or arranges
14 primary, secondary, and tertiary managed health care services
15 under contract with the Illinois Department exclusively to
16 enrollees of the integrated health care program. A managed
17 care community network may contract with the Illinois
18 Department to provide only pediatric health care services. A
19 county provider as defined in Section 15-1 of this Code may
20 contract with the Illinois Department to provide services to
21 enrollees of the integrated health care program as a managed
22 care community network without the need to establish a
23 separate entity that provides services exclusively to
24 enrollees of the integrated health care program and shall be
25 deemed a managed care community network for purposes of this
26 Code only to the extent of the provision of services to those
27 enrollees in conjunction with the integrated health care
28 program. A county provider shall be entitled to contract
29 with the Illinois Department with respect to any contracting
30 region located in whole or in part within the county. A
31 county provider shall not be required to accept enrollees who
32 do not reside within the county.
33 Each managed care community network must demonstrate its
34 ability to bear the financial risk of serving enrollees under
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1 this program. The Illinois Department shall by rule adopt
2 criteria for assessing the financial soundness of each
3 managed care community network. These rules shall consider
4 the extent to which a managed care community network is
5 comprised of providers who directly render health care and
6 are located within the community in which they seek to
7 contract rather than solely arrange or finance the delivery
8 of health care. These rules shall further consider a variety
9 of risk-bearing and management techniques, including the
10 sufficiency of quality assurance and utilization management
11 programs and whether a managed care community network has
12 sufficiently demonstrated its financial solvency and net
13 worth. The Illinois Department's criteria must be based on
14 sound actuarial, financial, and accounting principles. In
15 adopting these rules, the Illinois Department shall consult
16 with the Illinois Department of Insurance. The Illinois
17 Department is responsible for monitoring compliance with
18 these rules.
19 This Section may not be implemented before the effective
20 date of these rules, the approval of any necessary federal
21 waivers, and the completion of the review of an application
22 submitted, at least 60 days before the effective date of
23 rules adopted under this Section, to the Illinois Department
24 by a managed care community network.
25 All health care delivery systems that contract with the
26 Illinois Department under the integrated health care program
27 shall clearly recognize a health care provider's right of
28 conscience under the Right of Conscience Act. In addition to
29 the provisions of that Act, no health care delivery system
30 that contracts with the Illinois Department under the
31 integrated health care program shall be required to provide,
32 arrange for, or pay for any health care or medical service,
33 procedure, or product if that health care delivery system is
34 owned, controlled, or sponsored by or affiliated with a
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1 religious institution or religious organization that finds
2 that health care or medical service, procedure, or product to
3 violate its religious and moral teachings and beliefs.
4 (b) (Blank.) The Illinois Department may, by rule,
5 provide for different benefit packages for different
6 categories of persons enrolled in the program. Mental health
7 services, alcohol and substance abuse services, services
8 related to children with chronic or acute conditions
9 requiring longer-term treatment and follow-up, and
10 rehabilitation care provided by a free-standing
11 rehabilitation hospital or a hospital rehabilitation unit may
12 be excluded from a benefit package if the State ensures that
13 those services are made available through a separate delivery
14 system. An exclusion does not prohibit the Illinois
15 Department from developing and implementing demonstration
16 projects for categories of persons or services. Benefit
17 packages for persons eligible for medical assistance under
18 Articles V, VI, and XII shall be based on the requirements of
19 those Articles and shall be consistent with the Title XIX of
20 the Social Security Act. Nothing in this Act shall be
21 construed to apply to services purchased by the Department of
22 Children and Family Services and the Department of Human
23 Services (as successor to the Department of Mental Health and
24 Developmental Disabilities) under the provisions of Title 59
25 of the Illinois Administrative Code, Part 132 ("Medicaid
26 Community Mental Health Services Program").
27 (c) The program established by this Section may be
28 implemented by the Illinois Department in various contracting
29 areas at various times. The health care delivery systems and
30 providers available under the program may vary throughout the
31 State. For purposes of contracting with managed health care
32 entities and providers, the Illinois Department shall
33 establish contracting areas similar to the geographic areas
34 designated by the Illinois Department for contracting
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1 purposes under the Illinois Competitive Access and
2 Reimbursement Equity Program (ICARE) under the authority of
3 Section 3-4 of the Illinois Health Finance Reform Act or
4 similarly-sized or smaller geographic areas established by
5 the Illinois Department by rule. A managed health care entity
6 shall be permitted to contract in any geographic areas for
7 which it has a sufficient provider network and otherwise
8 meets the contracting terms of the State. The Illinois
9 Department is not prohibited from entering into a contract
10 with a managed health care entity at any time.
11 (d) A managed health care entity that contracts with the
12 Illinois Department for the provision of services under the
13 program shall do all of the following, solely for purposes of
14 the integrated health care program:
15 (1) Provide that any individual physician licensed
16 to practice medicine in all its branches, any pharmacy,
17 any federally qualified health center, and any
18 podiatrist, that consistently meets the reasonable terms
19 and conditions established by the managed health care
20 entity, including but not limited to credentialing
21 standards, quality assurance program requirements,
22 utilization management requirements, financial
23 responsibility standards, contracting process
24 requirements, and provider network size and accessibility
25 requirements, must be accepted by the managed health care
26 entity for purposes of the Illinois integrated health
27 care program. Any individual who is either terminated
28 from or denied inclusion in the panel of physicians of
29 the managed health care entity shall be given, within 10
30 business days after that determination, a written
31 explanation of the reasons for his or her exclusion or
32 termination from the panel. This paragraph (1) does not
33 apply to the following:
34 (A) A managed health care entity that
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1 certifies to the Illinois Department that:
2 (i) it employs on a full-time basis 125
3 or more Illinois physicians licensed to
4 practice medicine in all of its branches; and
5 (ii) it will provide medical services
6 through its employees to more than 80% of the
7 recipients enrolled with the entity in the
8 integrated health care program; or
9 (B) A domestic stock insurance company
10 licensed under clause (b) of class 1 of Section 4 of
11 the Illinois Insurance Code if (i) at least 66% of
12 the stock of the insurance company is owned by a
13 professional corporation organized under the
14 Professional Service Corporation Act that has 125 or
15 more shareholders who are Illinois physicians
16 licensed to practice medicine in all of its branches
17 and (ii) the insurance company certifies to the
18 Illinois Department that at least 80% of those
19 physician shareholders will provide services to
20 recipients enrolled with the company in the
21 integrated health care program.
22 (2) Provide for reimbursement for providers for
23 emergency care, as defined by the Illinois Department by
24 rule, that must be provided to its enrollees, including
25 an emergency room screening fee, and urgent care that it
26 authorizes for its enrollees, regardless of the
27 provider's affiliation with the managed health care
28 entity. Providers shall be reimbursed for emergency care
29 at an amount equal to the Illinois Department's
30 fee-for-service rates for those medical services rendered
31 by providers not under contract with the managed health
32 care entity to enrollees of the entity.
33 (3) Provide that any provider affiliated with a
34 managed health care entity may also provide services on a
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1 fee-for-service basis to Illinois Department clients not
2 enrolled in a managed health care entity.
3 (4) Provide client education services as determined
4 and approved by the Illinois Department, including but
5 not limited to (i) education regarding appropriate
6 utilization of health care services in a managed care
7 system, (ii) written disclosure of treatment policies and
8 any restrictions or limitations on health services,
9 including, but not limited to, physical services,
10 clinical laboratory tests, hospital and surgical
11 procedures, prescription drugs and biologics, and
12 radiological examinations, and (iii) written notice that
13 the enrollee may receive from another provider those
14 services covered under this program that are not provided
15 by the managed health care entity.
16 (5) Provide that enrollees within its system may
17 choose the site for provision of services and the panel
18 of health care providers.
19 (6) Not discriminate in its enrollment or
20 disenrollment practices among recipients of medical
21 services or program enrollees based on health status.
22 (7) Provide a quality assurance and utilization
23 review program that (i) for health maintenance
24 organizations meets the requirements of the Health
25 Maintenance Organization Act and (ii) for managed care
26 community networks meets the requirements established by
27 the Illinois Department in rules that incorporate those
28 standards set forth in the Health Maintenance
29 Organization Act.
30 (8) Issue a managed health care entity
31 identification card to each enrollee upon enrollment.
32 The card must contain all of the following:
33 (A) The enrollee's signature.
34 (B) The enrollee's health plan.
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1 (C) The name and telephone number of the
2 enrollee's primary care physician.
3 (D) A telephone number to be used for
4 emergency service 24 hours per day, 7 days per week.
5 The telephone number required to be maintained
6 pursuant to this subparagraph by each managed health
7 care entity shall, at minimum, be staffed by
8 medically trained personnel and be provided
9 directly, or under arrangement, at an office or
10 offices in locations maintained solely within the
11 State of Illinois. For purposes of this
12 subparagraph, "medically trained personnel" means
13 licensed practical nurses or registered nurses
14 located in the State of Illinois who are licensed
15 pursuant to the Illinois Nursing Act of 1987.
16 (9) Ensure that every primary care physician and
17 pharmacy in the managed health care entity meets the
18 standards established by the Illinois Department for
19 accessibility and quality of care. The Illinois
20 Department shall arrange for and oversee an evaluation of
21 the standards established under this paragraph (9) and
22 may recommend any necessary changes to these standards.
23 The Illinois Department shall submit an annual report to
24 the Governor and the General Assembly by April 1 of each
25 year regarding the effect of the standards on ensuring
26 access and quality of care to enrollees.
27 (10) Provide a procedure for handling complaints
28 that (i) for health maintenance organizations meets the
29 requirements of the Health Maintenance Organization Act
30 and (ii) for managed care community networks meets the
31 requirements established by the Illinois Department in
32 rules that incorporate those standards set forth in the
33 Health Maintenance Organization Act.
34 (11) Maintain, retain, and make available to the
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1 Illinois Department records, data, and information, in a
2 uniform manner determined by the Illinois Department,
3 sufficient for the Illinois Department to monitor
4 utilization, accessibility, and quality of care.
5 (12) Except for providers who are prepaid, pay all
6 approved claims for covered services that are completed
7 and submitted to the managed health care entity within 30
8 days after receipt of the claim or receipt of the
9 appropriate capitation payment or payments by the managed
10 health care entity from the State for the month in which
11 the services included on the claim were rendered,
12 whichever is later. If payment is not made or mailed to
13 the provider by the managed health care entity by the due
14 date under this subsection, an interest penalty of 1% of
15 any amount unpaid shall be added for each month or
16 fraction of a month after the due date, until final
17 payment is made. Nothing in this Section shall prohibit
18 managed health care entities and providers from mutually
19 agreeing to terms that require more timely payment.
20 (13) Provide integration with community-based
21 programs provided by certified local health departments
22 such as Women, Infants, and Children Supplemental Food
23 Program (WIC), childhood immunization programs, health
24 education programs, case management programs, and health
25 screening programs.
26 (14) Provide that the pharmacy formulary used by a
27 managed health care entity and its contract providers be
28 no more restrictive than the Illinois Department's
29 pharmaceutical program on the effective date of this
30 amendatory Act of 1994 and as amended after that date.
31 (15) Provide integration with community-based
32 organizations, including, but not limited to, any
33 organization that has operated within a Medicaid
34 Partnership as defined by this Code or by rule of the
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1 Illinois Department, that may continue to operate under a
2 contract with the Illinois Department or a managed health
3 care entity under this Section to provide case management
4 services to Medicaid clients in designated high-need
5 areas.
6 The Illinois Department may, by rule, determine
7 methodologies to limit financial liability for managed health
8 care entities resulting from payment for services to
9 enrollees provided under the Illinois Department's integrated
10 health care program. Any methodology so determined may be
11 considered or implemented by the Illinois Department through
12 a contract with a managed health care entity under this
13 integrated health care program.
14 The Illinois Department shall contract with an entity or
15 entities to provide external peer-based quality assurance
16 review for the integrated health care program. The entity
17 shall be representative of Illinois physicians licensed to
18 practice medicine in all its branches and have statewide
19 geographic representation in all specialties of medical care
20 that are provided within the integrated health care program.
21 The entity may not be a third party payer and shall maintain
22 offices in locations around the State in order to provide
23 service and continuing medical education to physician
24 participants within the integrated health care program. The
25 review process shall be developed and conducted by Illinois
26 physicians licensed to practice medicine in all its branches.
27 In consultation with the entity, the Illinois Department may
28 contract with other entities for professional peer-based
29 quality assurance review of individual categories of services
30 other than services provided, supervised, or coordinated by
31 physicians licensed to practice medicine in all its branches.
32 The Illinois Department shall establish, by rule, criteria to
33 avoid conflicts of interest in the conduct of quality
34 assurance activities consistent with professional peer-review
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1 standards. All quality assurance activities shall be
2 coordinated by the Illinois Department.
3 (e) All persons enrolled in the program shall be
4 provided with a full written explanation of all
5 fee-for-service and managed health care plan options and a
6 reasonable opportunity to choose among the options as
7 provided by rule. The Illinois Department shall provide to
8 enrollees, upon enrollment in the integrated health care
9 program and at least annually thereafter, notice of the
10 process for requesting an appeal under the Illinois
11 Department's administrative appeal procedures.
12 Notwithstanding any other Section of this Code, the Illinois
13 Department may provide by rule for the Illinois Department to
14 assign a person enrolled in the program to a specific
15 provider of medical services or to a specific health care
16 delivery system if an enrollee has failed to exercise choice
17 in a timely manner. An enrollee assigned by the Illinois
18 Department shall be afforded the opportunity to disenroll and
19 to select a specific provider of medical services or a
20 specific health care delivery system within the first 30 days
21 after the assignment. An enrollee who has failed to exercise
22 choice in a timely manner may be assigned only if there are 3
23 or more managed health care entities contracting with the
24 Illinois Department within the contracting area, except that,
25 outside the City of Chicago, this requirement may be waived
26 for an area by rules adopted by the Illinois Department after
27 consultation with all hospitals within the contracting area.
28 The Illinois Department shall establish by rule the procedure
29 for random assignment of enrollees who fail to exercise
30 choice in a timely manner to a specific managed health care
31 entity in proportion to the available capacity of that
32 managed health care entity. Assignment to a specific provider
33 of medical services or to a specific managed health care
34 entity may not exceed that provider's or entity's capacity as
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1 determined by the Illinois Department. Any person who has
2 chosen a specific provider of medical services or a specific
3 managed health care entity, or any person who has been
4 assigned under this subsection, shall be given the
5 opportunity to change that choice or assignment at least once
6 every 12 months, as determined by the Illinois Department by
7 rule. The Illinois Department shall maintain a toll-free
8 telephone number for program enrollees' use in reporting
9 problems with managed health care entities.
10 (f) If a person becomes eligible for participation in
11 the integrated health care program while he or she is
12 hospitalized, the Illinois Department may not enroll that
13 person in the program until after he or she has been
14 discharged from the hospital. This subsection does not apply
15 to newborn infants whose mothers are enrolled in the
16 integrated health care program.
17 (g) The Illinois Department shall, by rule, establish
18 for managed health care entities rates that (i) are certified
19 to be actuarially sound, as determined by an actuary who is
20 an associate or a fellow of the Society of Actuaries or a
21 member of the American Academy of Actuaries and who has
22 expertise and experience in medical insurance and benefit
23 programs, in accordance with the Illinois Department's
24 current fee-for-service payment system, and (ii) take into
25 account any difference of cost to provide health care to
26 different populations based on gender, age, location, and
27 eligibility category. The rates for managed health care
28 entities shall be determined on a capitated basis.
29 The Illinois Department by rule shall establish a method
30 to adjust its payments to managed health care entities in a
31 manner intended to avoid providing any financial incentive to
32 a managed health care entity to refer patients to a county
33 provider, in an Illinois county having a population greater
34 than 3,000,000, that is paid directly by the Illinois
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1 Department. The Illinois Department shall by April 1, 1997,
2 and annually thereafter, review the method to adjust
3 payments. Payments by the Illinois Department to the county
4 provider, for persons not enrolled in a managed care
5 community network owned or operated by a county provider,
6 shall be paid on a fee-for-service basis under Article XV of
7 this Code.
8 The Illinois Department by rule shall establish a method
9 to reduce its payments to managed health care entities to
10 take into consideration (i) any adjustment payments paid to
11 hospitals under subsection (h) of this Section to the extent
12 those payments, or any part of those payments, have been
13 taken into account in establishing capitated rates under this
14 subsection (g) and (ii) the implementation of methodologies
15 to limit financial liability for managed health care entities
16 under subsection (d) of this Section.
17 (h) For hospital services provided by a hospital that
18 contracts with a managed health care entity, adjustment
19 payments shall be paid directly to the hospital by the
20 Illinois Department. Adjustment payments may include but
21 need not be limited to adjustment payments to:
22 disproportionate share hospitals under Section 5-5.02 of this
23 Code; primary care access health care education payments (89
24 Ill. Adm. Code 149.140); payments for capital, direct medical
25 education, indirect medical education, certified registered
26 nurse anesthetist, and kidney acquisition costs (89 Ill. Adm.
27 Code 149.150(c)); uncompensated care payments (89 Ill. Adm.
28 Code 148.150(h)); trauma center payments (89 Ill. Adm. Code
29 148.290(c)); rehabilitation hospital payments (89 Ill. Adm.
30 Code 148.290(d)); perinatal center payments (89 Ill. Adm.
31 Code 148.290(e)); obstetrical care payments (89 Ill. Adm.
32 Code 148.290(f)); targeted access payments (89 Ill. Adm. Code
33 148.290(g)); Medicaid high volume payments (89 Ill. Adm. Code
34 148.290(h)); and outpatient indigent volume adjustments (89
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1 Ill. Adm. Code 148.140(b)(5)).
2 (i) For any hospital eligible for the adjustment
3 payments described in subsection (h), the Illinois Department
4 shall maintain, through the period ending June 30, 1995,
5 reimbursement levels in accordance with statutes and rules in
6 effect on April 1, 1994.
7 (j) Nothing contained in this Code in any way limits or
8 otherwise impairs the authority or power of the Illinois
9 Department to enter into a negotiated contract pursuant to
10 this Section with a managed health care entity, including,
11 but not limited to, a health maintenance organization, that
12 provides for termination or nonrenewal of the contract
13 without cause upon notice as provided in the contract and
14 without a hearing.
15 (k) Section 5-5.15 does not apply to the program
16 developed and implemented pursuant to this Section.
17 (l) (Blank.) The Illinois Department shall, by rule,
18 define those chronic or acute medical conditions of childhood
19 that require longer-term treatment and follow-up care. The
20 Illinois Department shall ensure that services required to
21 treat these conditions are available through a separate
22 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
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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) (Blank.) Behavioral health services provided or
29 funded by the Department of Human Services, the Department of
30 Children and Family Services, and the Illinois Department
31 shall be excluded from a benefit package. Conditions of an
32 organic or physical origin or nature, including medical
33 detoxification, however, may not be excluded. In this
34 subsection, "behavioral health services" means mental health
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1 services and subacute alcohol and substance abuse treatment
2 services, as defined in the Illinois Alcoholism and Other
3 Drug Dependency Act. In this subsection, "mental health
4 services" includes, at a minimum, the following services
5 funded by the Illinois Department, the Department of Human
6 Services (as successor to the Department of Mental Health and
7 Developmental Disabilities), or the Department of Children
8 and Family Services: (i) inpatient hospital services,
9 including related physician services, related psychiatric
10 interventions, and pharmaceutical services provided to an
11 eligible recipient hospitalized with a primary diagnosis of
12 psychiatric disorder; (ii) outpatient mental health services
13 as defined and specified in Title 59 of the Illinois
14 Administrative Code, Part 132; (iii) any other outpatient
15 mental health services funded by the Illinois Department
16 pursuant to the State of Illinois Medicaid Plan; (iv) partial
17 hospitalization; and (v) follow-up stabilization related to
18 any of those services. Additional behavioral health services
19 may be excluded under this subsection as mutually agreed in
20 writing by the Illinois Department and the affected State
21 agency or agencies. The exclusion of any service does not
22 prohibit the Illinois Department from developing and
23 implementing demonstration projects for categories of persons
24 or services. The Department of Children and Family Services
25 and the Department of Human Services shall each adopt rules
26 governing the integration of managed care in the provision of
27 behavioral health services. The State shall integrate managed
28 care community networks and affiliated providers, to the
29 extent practicable, in any separate delivery system for
30 mental health services.
31 (n) The Illinois Department shall adopt rules to
32 establish reserve requirements for managed care community
33 networks, as required by subsection (a), and health
34 maintenance organizations to protect against liabilities in
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1 the event that a managed health care entity is declared
2 insolvent or bankrupt. If a managed health care entity other
3 than a county provider is declared insolvent or bankrupt,
4 after liquidation and application of any available assets,
5 resources, and reserves, the Illinois Department shall pay a
6 portion of the amounts owed by the managed health care entity
7 to providers for services rendered to enrollees under the
8 integrated health care program under this Section based on
9 the following schedule: (i) from April 1, 1995 through June
10 30, 1998, 90% of the amounts owed; (ii) from July 1, 1998
11 through June 30, 2001, 80% of the amounts owed; and (iii)
12 from July 1, 2001 through June 30, 2005, 75% of the amounts
13 owed. The amounts paid under this subsection shall be
14 calculated based on the total amount owed by the managed
15 health care entity to providers before application of any
16 available assets, resources, and reserves. After June 30,
17 2005, the Illinois Department may not pay any amounts owed to
18 providers as a result of an insolvency or bankruptcy of a
19 managed health care entity occurring after that date. The
20 Illinois Department is not obligated, however, to pay amounts
21 owed to a provider that has an ownership or other governing
22 interest in the managed health care entity. This subsection
23 applies only to managed health care entities and the services
24 they provide under the integrated health care program under
25 this Section.
26 (o) Notwithstanding any other provision of law or
27 contractual agreement to the contrary, providers shall not be
28 required to accept from any other third party payer the rates
29 determined or paid under this Code by the Illinois
30 Department, managed health care entity, or other health care
31 delivery system for services provided to recipients.
32 (p) The Illinois Department may seek and obtain any
33 necessary authorization provided under federal law to
34 implement the program, including the waiver of any federal
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1 statutes or regulations. The Illinois Department may seek a
2 waiver of the federal requirement that the combined
3 membership of Medicare and Medicaid enrollees in a managed
4 care community network may not exceed 75% of the managed care
5 community network's total enrollment. The Illinois
6 Department shall not seek a waiver of this requirement for
7 any other category of managed health care entity. The
8 Illinois Department shall not seek a waiver of the inpatient
9 hospital reimbursement methodology in Section 1902(a)(13)(A)
10 of Title XIX of the Social Security Act even if the federal
11 agency responsible for administering Title XIX determines
12 that Section 1902(a)(13)(A) applies to managed health care
13 systems.
14 Notwithstanding any other provisions of this Code to the
15 contrary, the Illinois Department shall seek a waiver of
16 applicable federal law in order to impose a co-payment system
17 consistent with this subsection on recipients of medical
18 services under Title XIX of the Social Security Act who are
19 not enrolled in a managed health care entity. The waiver
20 request submitted by the Illinois Department shall provide
21 for co-payments of up to $0.50 for prescribed drugs and up to
22 $0.50 for x-ray services and shall provide for co-payments of
23 up to $10 for non-emergency services provided in a hospital
24 emergency room and up to $10 for non-emergency ambulance
25 services. The purpose of the co-payments shall be to deter
26 those recipients from seeking unnecessary medical care.
27 Co-payments may not be used to deter recipients from seeking
28 necessary medical care. No recipient shall be required to
29 pay more than a total of $150 per year in co-payments under
30 the waiver request required by this subsection. A recipient
31 may not be required to pay more than $15 of any amount due
32 under this subsection in any one month.
33 Co-payments authorized under this subsection may not be
34 imposed when the care was necessitated by a true medical
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1 emergency. Co-payments may not be imposed for any of the
2 following classifications of services:
3 (1) Services furnished to person under 18 years of
4 age.
5 (2) Services furnished to pregnant women.
6 (3) Services furnished to any individual who is an
7 inpatient in a hospital, nursing facility, intermediate
8 care facility, or other medical institution, if that
9 person is required to spend for costs of medical care all
10 but a minimal amount of his or her income required for
11 personal needs.
12 (4) Services furnished to a person who is receiving
13 hospice care.
14 Co-payments authorized under this subsection shall not be
15 deducted from or reduce in any way payments for medical
16 services from the Illinois Department to providers. No
17 provider may deny those services to an individual eligible
18 for services based on the individual's inability to pay the
19 co-payment.
20 Recipients who are subject to co-payments shall be
21 provided notice, in plain and clear language, of the amount
22 of the co-payments, the circumstances under which co-payments
23 are exempted, the circumstances under which co-payments may
24 be assessed, and their manner of collection.
25 The Illinois Department shall establish a Medicaid
26 Co-Payment Council to assist in the development of co-payment
27 policies for the medical assistance program. The Medicaid
28 Co-Payment Council shall also have jurisdiction to develop a
29 program to provide financial or non-financial incentives to
30 Medicaid recipients in order to encourage recipients to seek
31 necessary health care. The Council shall be chaired by the
32 Director of the Illinois Department, and shall have 6
33 additional members. Two of the 6 additional members shall be
34 appointed by the Governor, and one each shall be appointed by
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1 the President of the Senate, the Minority Leader of the
2 Senate, the Speaker of the House of Representatives, and the
3 Minority Leader of the House of Representatives. The Council
4 may be convened and make recommendations upon the appointment
5 of a majority of its members. The Council shall be appointed
6 and convened no later than September 1, 1994 and shall report
7 its recommendations to the Director of the Illinois
8 Department and the General Assembly no later than October 1,
9 1994. The chairperson of the Council shall be allowed to
10 vote only in the case of a tie vote among the appointed
11 members of the Council.
12 The Council shall be guided by the following principles
13 as it considers recommendations to be developed to implement
14 any approved waivers that the Illinois Department must seek
15 pursuant to this subsection:
16 (1) Co-payments should not be used to deter access
17 to adequate medical care.
18 (2) Co-payments should be used to reduce fraud.
19 (3) Co-payment policies should be examined in
20 consideration of other states' experience, and the
21 ability of successful co-payment plans to control
22 unnecessary or inappropriate utilization of services
23 should be promoted.
24 (4) All participants, both recipients and
25 providers, in the medical assistance program have
26 responsibilities to both the State and the program.
27 (5) Co-payments are primarily a tool to educate the
28 participants in the responsible use of health care
29 resources.
30 (6) Co-payments should not be used to penalize
31 providers.
32 (7) A successful medical program requires the
33 elimination of improper utilization of medical resources.
34 The integrated health care program, or any part of that
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1 program, established under this Section may not be
2 implemented if matching federal funds under Title XIX of the
3 Social Security Act are not available for administering the
4 program.
5 The Illinois Department shall submit for publication in
6 the Illinois Register the name, address, and telephone number
7 of the individual to whom a request may be directed for a
8 copy of the request for a waiver of provisions of Title XIX
9 of the Social Security Act that the Illinois Department
10 intends to submit to the Health Care Financing Administration
11 in order to implement this Section. The Illinois Department
12 shall mail a copy of that request for waiver to all
13 requestors at least 16 days before filing that request for
14 waiver with the Health Care Financing Administration.
15 (q) After the effective date of this Section, the
16 Illinois Department may take all planning and preparatory
17 action necessary to implement this Section, including, but
18 not limited to, seeking requests for proposals relating to
19 the integrated health care program created under this
20 Section.
21 (r) In order to (i) accelerate and facilitate the
22 development of integrated health care in contracting areas
23 outside counties with populations in excess of 3,000,000 and
24 counties adjacent to those counties and (ii) maintain and
25 sustain the high quality of education and residency programs
26 coordinated and associated with local area hospitals, the
27 Illinois Department may develop and implement a demonstration
28 program for managed care community networks owned, operated,
29 or governed by State-funded medical schools. The Illinois
30 Department shall prescribe by rule the criteria, standards,
31 and procedures for effecting this demonstration program.
32 (s) (Blank).
33 (t) On April 1, 1995 and every 6 months thereafter, the
34 Illinois Department shall report to the Governor and General
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1 Assembly on the progress of the integrated health care
2 program in enrolling clients into managed health care
3 entities. The report shall indicate the capacities of the
4 managed health care entities with which the State contracts,
5 the number of clients enrolled by each contractor, the areas
6 of the State in which managed care options do not exist, and
7 the progress toward meeting the enrollment goals of the
8 integrated health care program.
9 (u) The Illinois Department may implement this Section
10 through the use of emergency rules in accordance with Section
11 5-45 of the Illinois Administrative Procedure Act. For
12 purposes of that Act, the adoption of rules to implement this
13 Section is deemed an emergency and necessary for the public
14 interest, safety, and welfare.
15 (Source: P.A. 88-554, eff. 7-26-94; 89-21, eff. 7-1-95;
16 89-507, eff. 7-1-97; 89-673, eff. 8-14-96; revised 8-26-96.)
17 Section 95. No acceleration or delay. Where this Act
18 makes changes in a statute that is represented in this Act by
19 text that is not yet or no longer in effect (for example, a
20 Section represented by multiple versions), the use of that
21 text does not accelerate or delay the taking effect of (i)
22 the changes made by this Act or (ii) provisions derived from
23 any other Public Act.
24 Section 99. Effective date. This Act takes effect upon
25 becoming law.