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90_HB0779
305 ILCS 5/5-16.3
Amends the Medicaid Article of the Public Aid Code. In
the Section concerning the integrated health care program,
requires that a managed health care entity ensure that no
payment is made to a physician or other service provider for
withholding from an enrollee any necessary or appropriate
care because of the cost of that care. Effective
immediately.
LRB9000967DJcd
LRB9000967DJcd
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) The Illinois Department may, by rule, provide for
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1 different benefit packages for different categories of
2 persons enrolled in the program. Mental health services,
3 alcohol and substance abuse services, services related to
4 children with chronic or acute conditions requiring
5 longer-term treatment and follow-up, and rehabilitation care
6 provided by a free-standing rehabilitation hospital or a
7 hospital rehabilitation unit may be excluded from a benefit
8 package if the State ensures that those services are made
9 available through a separate delivery system. An exclusion
10 does not prohibit the Illinois Department from developing and
11 implementing demonstration projects for categories of persons
12 or services. Benefit packages for persons eligible for
13 medical assistance under Articles V, VI, and XII shall be
14 based on the requirements of those Articles and shall be
15 consistent with the Title XIX of the Social Security Act.
16 Nothing in this Act shall be construed to apply to services
17 purchased by the Department of Children and Family Services
18 and the Department of Mental Health and Developmental
19 Disabilities under the provisions of Title 59 of the Illinois
20 Administrative Code, Part 132 ("Medicaid Community Mental
21 Health Services Program").
22 (c) The program established by this Section may be
23 implemented by the Illinois Department in various contracting
24 areas at various times. The health care delivery systems and
25 providers available under the program may vary throughout the
26 State. For purposes of contracting with managed health care
27 entities and providers, the Illinois Department shall
28 establish contracting areas similar to the geographic areas
29 designated by the Illinois Department for contracting
30 purposes under the Illinois Competitive Access and
31 Reimbursement Equity Program (ICARE) under the authority of
32 Section 3-4 of the Illinois Health Finance Reform Act or
33 similarly-sized or smaller geographic areas established by
34 the Illinois Department by rule. A managed health care entity
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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 (12.5) Ensure that no payment is made to a
16 physician or other provider of services for withholding
17 from an enrollee any necessary or appropriate care
18 because of the cost of that care.
19 (13) Provide integration with community-based
20 programs provided by certified local health departments
21 such as Women, Infants, and Children Supplemental Food
22 Program (WIC), childhood immunization programs, health
23 education programs, case management programs, and health
24 screening programs.
25 (14) Provide that the pharmacy formulary used by a
26 managed health care entity and its contract providers be
27 no more restrictive than the Illinois Department's
28 pharmaceutical program on the effective date of this
29 amendatory Act of 1994 and as amended after that date.
30 (15) Provide integration with community-based
31 organizations, including, but not limited to, any
32 organization that has operated within a Medicaid
33 Partnership as defined by this Code or by rule of the
34 Illinois Department, that may continue to operate under a
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1 contract with the Illinois Department or a managed health
2 care entity under this Section to provide case management
3 services to Medicaid clients in designated high-need
4 areas.
5 The Illinois Department may, by rule, determine
6 methodologies to limit financial liability for managed health
7 care entities resulting from payment for services to
8 enrollees provided under the Illinois Department's integrated
9 health care program. Any methodology so determined may be
10 considered or implemented by the Illinois Department through
11 a contract with a managed health care entity under this
12 integrated health care program.
13 The Illinois Department shall contract with an entity or
14 entities to provide external peer-based quality assurance
15 review for the integrated health care program. The entity
16 shall be representative of Illinois physicians licensed to
17 practice medicine in all its branches and have statewide
18 geographic representation in all specialties of medical care
19 that are provided within the integrated health care program.
20 The entity may not be a third party payer and shall maintain
21 offices in locations around the State in order to provide
22 service and continuing medical education to physician
23 participants within the integrated health care program. The
24 review process shall be developed and conducted by Illinois
25 physicians licensed to practice medicine in all its branches.
26 In consultation with the entity, the Illinois Department may
27 contract with other entities for professional peer-based
28 quality assurance review of individual categories of services
29 other than services provided, supervised, or coordinated by
30 physicians licensed to practice medicine in all its branches.
31 The Illinois Department shall establish, by rule, criteria to
32 avoid conflicts of interest in the conduct of quality
33 assurance activities consistent with professional peer-review
34 standards. All quality assurance activities shall be
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1 coordinated by the Illinois Department.
2 (e) All persons enrolled in the program shall be
3 provided with a full written explanation of all
4 fee-for-service and managed health care plan options and a
5 reasonable opportunity to choose among the options as
6 provided by rule. The Illinois Department shall provide to
7 enrollees, upon enrollment in the integrated health care
8 program and at least annually thereafter, notice of the
9 process for requesting an appeal under the Illinois
10 Department's administrative appeal procedures.
11 Notwithstanding any other Section of this Code, the Illinois
12 Department may provide by rule for the Illinois Department to
13 assign a person enrolled in the program to a specific
14 provider of medical services or to a specific health care
15 delivery system if an enrollee has failed to exercise choice
16 in a timely manner. An enrollee assigned by the Illinois
17 Department shall be afforded the opportunity to disenroll and
18 to select a specific provider of medical services or a
19 specific health care delivery system within the first 30 days
20 after the assignment. An enrollee who has failed to exercise
21 choice in a timely manner may be assigned only if there are 3
22 or more managed health care entities contracting with the
23 Illinois Department within the contracting area, except that,
24 outside the City of Chicago, this requirement may be waived
25 for an area by rules adopted by the Illinois Department after
26 consultation with all hospitals within the contracting area.
27 The Illinois Department shall establish by rule the procedure
28 for random assignment of enrollees who fail to exercise
29 choice in a timely manner to a specific managed health care
30 entity in proportion to the available capacity of that
31 managed health care entity. Assignment to a specific provider
32 of medical services or to a specific managed health care
33 entity may not exceed that provider's or entity's capacity as
34 determined by the Illinois Department. Any person who has
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1 chosen a specific provider of medical services or a specific
2 managed health care entity, or any person who has been
3 assigned under this subsection, shall be given the
4 opportunity to change that choice or assignment at least once
5 every 12 months, as determined by the Illinois Department by
6 rule. The Illinois Department shall maintain a toll-free
7 telephone number for program enrollees' use in reporting
8 problems with managed health care entities.
9 (f) If a person becomes eligible for participation in
10 the integrated health care program while he or she is
11 hospitalized, the Illinois Department may not enroll that
12 person in the program until after he or she has been
13 discharged from the hospital. This subsection does not apply
14 to newborn infants whose mothers are enrolled in the
15 integrated health care program.
16 (g) The Illinois Department shall, by rule, establish
17 for managed health care entities rates that (i) are certified
18 to be actuarially sound, as determined by an actuary who is
19 an associate or a fellow of the Society of Actuaries or a
20 member of the American Academy of Actuaries and who has
21 expertise and experience in medical insurance and benefit
22 programs, in accordance with the Illinois Department's
23 current fee-for-service payment system, and (ii) take into
24 account any difference of cost to provide health care to
25 different populations based on gender, age, location, and
26 eligibility category. The rates for managed health care
27 entities shall be determined on a capitated basis.
28 The Illinois Department by rule shall establish a method
29 to adjust its payments to managed health care entities in a
30 manner intended to avoid providing any financial incentive to
31 a managed health care entity to refer patients to a county
32 provider, in an Illinois county having a population greater
33 than 3,000,000, that is paid directly by the Illinois
34 Department. The Illinois Department shall by April 1, 1997,
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1 and annually thereafter, review the method to adjust
2 payments. Payments by the Illinois Department to the county
3 provider, for persons not enrolled in a managed care
4 community network owned or operated by a county provider,
5 shall be paid on a fee-for-service basis under Article XV of
6 this Code.
7 The Illinois Department by rule shall establish a method
8 to reduce its payments to managed health care entities to
9 take into consideration (i) any adjustment payments paid to
10 hospitals under subsection (h) of this Section to the extent
11 those payments, or any part of those payments, have been
12 taken into account in establishing capitated rates under this
13 subsection (g) and (ii) the implementation of methodologies
14 to limit financial liability for managed health care entities
15 under subsection (d) of this Section.
16 (h) For hospital services provided by a hospital that
17 contracts with a managed health care entity, adjustment
18 payments shall be paid directly to the hospital by the
19 Illinois Department. Adjustment payments may include but
20 need not be limited to adjustment payments to:
21 disproportionate share hospitals under Section 5-5.02 of this
22 Code; primary care access health care education payments (89
23 Ill. Adm. Code 149.140); payments for capital, direct medical
24 education, indirect medical education, certified registered
25 nurse anesthetist, and kidney acquisition costs (89 Ill. Adm.
26 Code 149.150(c)); uncompensated care payments (89 Ill. Adm.
27 Code 148.150(h)); trauma center payments (89 Ill. Adm. Code
28 148.290(c)); rehabilitation hospital payments (89 Ill. Adm.
29 Code 148.290(d)); perinatal center payments (89 Ill. Adm.
30 Code 148.290(e)); obstetrical care payments (89 Ill. Adm.
31 Code 148.290(f)); targeted access payments (89 Ill. Adm. Code
32 148.290(g)); Medicaid high volume payments (89 Ill. Adm. Code
33 148.290(h)); and outpatient indigent volume adjustments (89
34 Ill. Adm. Code 148.140(b)(5)).
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1 (i) For any hospital eligible for the adjustment
2 payments described in subsection (h), the Illinois Department
3 shall maintain, through the period ending June 30, 1995,
4 reimbursement levels in accordance with statutes and rules in
5 effect on April 1, 1994.
6 (j) Nothing contained in this Code in any way limits or
7 otherwise impairs the authority or power of the Illinois
8 Department to enter into a negotiated contract pursuant to
9 this Section with a managed health care entity, including,
10 but not limited to, a health maintenance organization, that
11 provides for termination or nonrenewal of the contract
12 without cause upon notice as provided in the contract and
13 without a hearing.
14 (k) Section 5-5.15 does not apply to the program
15 developed and implemented pursuant to this Section.
16 (l) The Illinois Department shall, by rule, define those
17 chronic or acute medical conditions of childhood that require
18 longer-term treatment and follow-up care. The Illinois
19 Department shall ensure that services required to treat these
20 conditions are available through a separate delivery system.
21 A managed health care entity that contracts with the
22 Illinois Department may refer a child with medical conditions
23 described in the rules adopted under this subsection directly
24 to a children's hospital or to a hospital, other than a
25 children's hospital, that is qualified to provide inpatient
26 and outpatient services to treat those conditions. The
27 Illinois Department shall provide fee-for-service
28 reimbursement directly to a children's hospital for those
29 services pursuant to Title 89 of the Illinois Administrative
30 Code, Section 148.280(a), at a rate at least equal to the
31 rate in effect on March 31, 1994. For hospitals, other than
32 children's hospitals, that are qualified to provide inpatient
33 and outpatient services to treat those conditions, the
34 Illinois Department shall provide reimbursement for those
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1 services on a fee-for-service basis, at a rate at least equal
2 to the rate in effect for those other hospitals on March 31,
3 1994.
4 A children's hospital shall be directly reimbursed for
5 all services provided at the children's hospital on a
6 fee-for-service basis pursuant to Title 89 of the Illinois
7 Administrative Code, Section 148.280(a), at a rate at least
8 equal to the rate in effect on March 31, 1994, until the
9 later of (i) implementation of the integrated health care
10 program under this Section and development of actuarially
11 sound capitation rates for services other than those chronic
12 or acute medical conditions of childhood that require
13 longer-term treatment and follow-up care as defined by the
14 Illinois Department in the rules adopted under this
15 subsection or (ii) March 31, 1996.
16 Notwithstanding anything in this subsection to the
17 contrary, a managed health care entity shall not consider
18 sources or methods of payment in determining the referral of
19 a child. The Illinois Department shall adopt rules to
20 establish criteria for those referrals. The Illinois
21 Department by rule shall establish a method to adjust its
22 payments to managed health care entities in a manner intended
23 to avoid providing any financial incentive to a managed
24 health care entity to refer patients to a provider who is
25 paid directly by the Illinois Department.
26 (m) Behavioral health services provided or funded by the
27 Department of Mental Health and Developmental Disabilities,
28 the Department of Alcoholism and Substance Abuse, the
29 Department of Children and Family Services, and the Illinois
30 Department shall be excluded from a benefit package.
31 Conditions of an organic or physical origin or nature,
32 including medical detoxification, however, may not be
33 excluded. In this subsection, "behavioral health services"
34 means mental health services and subacute alcohol and
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1 substance abuse treatment services, as defined in the
2 Illinois Alcoholism and Other Drug Dependency Act. In this
3 subsection, "mental health services" includes, at a minimum,
4 the following services funded by the Illinois Department, the
5 Department of Mental Health and Developmental Disabilities,
6 or the Department of Children and Family Services: (i)
7 inpatient hospital services, including related physician
8 services, related psychiatric interventions, and
9 pharmaceutical services provided to an eligible recipient
10 hospitalized with a primary diagnosis of psychiatric
11 disorder; (ii) outpatient mental health services as defined
12 and specified in Title 59 of the Illinois Administrative
13 Code, Part 132; (iii) any other outpatient mental health
14 services funded by the Illinois Department pursuant to the
15 State of Illinois Medicaid Plan; (iv) partial
16 hospitalization; and (v) follow-up stabilization related to
17 any of those services. Additional behavioral health services
18 may be excluded under this subsection as mutually agreed in
19 writing by the Illinois Department and the affected State
20 agency or agencies. The exclusion of any service does not
21 prohibit the Illinois Department from developing and
22 implementing demonstration projects for categories of persons
23 or services. The Department of Mental Health and
24 Developmental Disabilities, the Department of Children and
25 Family Services, and the Department of Alcoholism and
26 Substance Abuse shall each adopt rules governing the
27 integration of managed care in the provision of behavioral
28 health services. The State shall integrate managed care
29 community networks and affiliated providers, to the extent
30 practicable, in any separate delivery system for mental
31 health services.
32 (n) The Illinois Department shall adopt rules to
33 establish reserve requirements for managed care community
34 networks, as required by subsection (a), and health
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1 maintenance organizations to protect against liabilities in
2 the event that a managed health care entity is declared
3 insolvent or bankrupt. If a managed health care entity other
4 than a county provider is declared insolvent or bankrupt,
5 after liquidation and application of any available assets,
6 resources, and reserves, the Illinois Department shall pay a
7 portion of the amounts owed by the managed health care entity
8 to providers for services rendered to enrollees under the
9 integrated health care program under this Section based on
10 the following schedule: (i) from April 1, 1995 through June
11 30, 1998, 90% of the amounts owed; (ii) from July 1, 1998
12 through June 30, 2001, 80% of the amounts owed; and (iii)
13 from July 1, 2001 through June 30, 2005, 75% of the amounts
14 owed. The amounts paid under this subsection shall be
15 calculated based on the total amount owed by the managed
16 health care entity to providers before application of any
17 available assets, resources, and reserves. After June 30,
18 2005, the Illinois Department may not pay any amounts owed to
19 providers as a result of an insolvency or bankruptcy of a
20 managed health care entity occurring after that date. The
21 Illinois Department is not obligated, however, to pay amounts
22 owed to a provider that has an ownership or other governing
23 interest in the managed health care entity. This subsection
24 applies only to managed health care entities and the services
25 they provide under the integrated health care program under
26 this Section.
27 (o) Notwithstanding any other provision of law or
28 contractual agreement to the contrary, providers shall not be
29 required to accept from any other third party payer the rates
30 determined or paid under this Code by the Illinois
31 Department, managed health care entity, or other health care
32 delivery system for services provided to recipients.
33 (p) The Illinois Department may seek and obtain any
34 necessary authorization provided under federal law to
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1 implement the program, including the waiver of any federal
2 statutes or regulations. The Illinois Department may seek a
3 waiver of the federal requirement that the combined
4 membership of Medicare and Medicaid enrollees in a managed
5 care community network may not exceed 75% of the managed care
6 community network's total enrollment. The Illinois
7 Department shall not seek a waiver of this requirement for
8 any other category of managed health care entity. The
9 Illinois Department shall not seek a waiver of the inpatient
10 hospital reimbursement methodology in Section 1902(a)(13)(A)
11 of Title XIX of the Social Security Act even if the federal
12 agency responsible for administering Title XIX determines
13 that Section 1902(a)(13)(A) applies to managed health care
14 systems.
15 Notwithstanding any other provisions of this Code to the
16 contrary, the Illinois Department shall seek a waiver of
17 applicable federal law in order to impose a co-payment system
18 consistent with this subsection on recipients of medical
19 services under Title XIX of the Social Security Act who are
20 not enrolled in a managed health care entity. The waiver
21 request submitted by the Illinois Department shall provide
22 for co-payments of up to $0.50 for prescribed drugs and up to
23 $0.50 for x-ray services and shall provide for co-payments of
24 up to $10 for non-emergency services provided in a hospital
25 emergency room and up to $10 for non-emergency ambulance
26 services. The purpose of the co-payments shall be to deter
27 those recipients from seeking unnecessary medical care.
28 Co-payments may not be used to deter recipients from seeking
29 necessary medical care. No recipient shall be required to
30 pay more than a total of $150 per year in co-payments under
31 the waiver request required by this subsection. A recipient
32 may not be required to pay more than $15 of any amount due
33 under this subsection in any one month.
34 Co-payments authorized under this subsection may not be
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1 imposed when the care was necessitated by a true medical
2 emergency. Co-payments may not be imposed for any of the
3 following classifications of services:
4 (1) Services furnished to person under 18 years of
5 age.
6 (2) Services furnished to pregnant women.
7 (3) Services furnished to any individual who is an
8 inpatient in a hospital, nursing facility, intermediate
9 care facility, or other medical institution, if that
10 person is required to spend for costs of medical care all
11 but a minimal amount of his or her income required for
12 personal needs.
13 (4) Services furnished to a person who is receiving
14 hospice care.
15 Co-payments authorized under this subsection shall not be
16 deducted from or reduce in any way payments for medical
17 services from the Illinois Department to providers. No
18 provider may deny those services to an individual eligible
19 for services based on the individual's inability to pay the
20 co-payment.
21 Recipients who are subject to co-payments shall be
22 provided notice, in plain and clear language, of the amount
23 of the co-payments, the circumstances under which co-payments
24 are exempted, the circumstances under which co-payments may
25 be assessed, and their manner of collection.
26 The Illinois Department shall establish a Medicaid
27 Co-Payment Council to assist in the development of co-payment
28 policies for the medical assistance program. The Medicaid
29 Co-Payment Council shall also have jurisdiction to develop a
30 program to provide financial or non-financial incentives to
31 Medicaid recipients in order to encourage recipients to seek
32 necessary health care. The Council shall be chaired by the
33 Director of the Illinois Department, and shall have 6
34 additional members. Two of the 6 additional members shall be
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1 appointed by the Governor, and one each shall be appointed by
2 the President of the Senate, the Minority Leader of the
3 Senate, the Speaker of the House of Representatives, and the
4 Minority Leader of the House of Representatives. The Council
5 may be convened and make recommendations upon the appointment
6 of a majority of its members. The Council shall be appointed
7 and convened no later than September 1, 1994 and shall report
8 its recommendations to the Director of the Illinois
9 Department and the General Assembly no later than October 1,
10 1994. The chairperson of the Council shall be allowed to
11 vote only in the case of a tie vote among the appointed
12 members of the Council.
13 The Council shall be guided by the following principles
14 as it considers recommendations to be developed to implement
15 any approved waivers that the Illinois Department must seek
16 pursuant to this subsection:
17 (1) Co-payments should not be used to deter access
18 to adequate medical care.
19 (2) Co-payments should be used to reduce fraud.
20 (3) Co-payment policies should be examined in
21 consideration of other states' experience, and the
22 ability of successful co-payment plans to control
23 unnecessary or inappropriate utilization of services
24 should be promoted.
25 (4) All participants, both recipients and
26 providers, in the medical assistance program have
27 responsibilities to both the State and the program.
28 (5) Co-payments are primarily a tool to educate the
29 participants in the responsible use of health care
30 resources.
31 (6) Co-payments should not be used to penalize
32 providers.
33 (7) A successful medical program requires the
34 elimination of improper utilization of medical resources.
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1 The integrated health care program, or any part of that
2 program, established under this Section may not be
3 implemented if matching federal funds under Title XIX of the
4 Social Security Act are not available for administering the
5 program.
6 The Illinois Department shall submit for publication in
7 the Illinois Register the name, address, and telephone number
8 of the individual to whom a request may be directed for a
9 copy of the request for a waiver of provisions of Title XIX
10 of the Social Security Act that the Illinois Department
11 intends to submit to the Health Care Financing Administration
12 in order to implement this Section. The Illinois Department
13 shall mail a copy of that request for waiver to all
14 requestors at least 16 days before filing that request for
15 waiver with the Health Care Financing Administration.
16 (q) After the effective date of this Section, the
17 Illinois Department may take all planning and preparatory
18 action necessary to implement this Section, including, but
19 not limited to, seeking requests for proposals relating to
20 the integrated health care program created under this
21 Section.
22 (r) In order to (i) accelerate and facilitate the
23 development of integrated health care in contracting areas
24 outside counties with populations in excess of 3,000,000 and
25 counties adjacent to those counties and (ii) maintain and
26 sustain the high quality of education and residency programs
27 coordinated and associated with local area hospitals, the
28 Illinois Department may develop and implement a demonstration
29 program for managed care community networks owned, operated,
30 or governed by State-funded medical schools. The Illinois
31 Department shall prescribe by rule the criteria, standards,
32 and procedures for effecting this demonstration program.
33 (s) (Blank).
34 (t) On April 1, 1995 and every 6 months thereafter, the
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1 Illinois Department shall report to the Governor and General
2 Assembly on the progress of the integrated health care
3 program in enrolling clients into managed health care
4 entities. The report shall indicate the capacities of the
5 managed health care entities with which the State contracts,
6 the number of clients enrolled by each contractor, the areas
7 of the State in which managed care options do not exist, and
8 the progress toward meeting the enrollment goals of the
9 integrated health care program.
10 (u) The Illinois Department may implement this Section
11 through the use of emergency rules in accordance with Section
12 5-45 of the Illinois Administrative Procedure Act. For
13 purposes of that Act, the adoption of rules to implement this
14 Section is deemed an emergency and necessary for the public
15 interest, safety, and welfare.
16 (Source: P.A. 88-554, eff. 7-26-94; 89-21, eff. 7-1-95;
17 89-673, eff. 8-14-96; revised 8-26-96.)
18 (Text of Section after amendment by P.A. 89-507)
19 Sec. 5-16.3. System for integrated health care services.
20 (a) It shall be the public policy of the State to adopt,
21 to the extent practicable, a health care program that
22 encourages the integration of health care services and
23 manages the health care of program enrollees while preserving
24 reasonable choice within a competitive and cost-efficient
25 environment. In furtherance of this public policy, the
26 Illinois Department shall develop and implement an integrated
27 health care program consistent with the provisions of this
28 Section. The provisions of this Section apply only to the
29 integrated health care program created under this Section.
30 Persons enrolled in the integrated health care program, as
31 determined by the Illinois Department by rule, shall be
32 afforded a choice among health care delivery systems, which
33 shall include, but are not limited to, (i) fee for service
34 care managed by a primary care physician licensed to practice
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1 medicine in all its branches, (ii) managed health care
2 entities, and (iii) federally qualified health centers
3 (reimbursed according to a prospective cost-reimbursement
4 methodology) and rural health clinics (reimbursed according
5 to the Medicare methodology), where available. Persons
6 enrolled in the integrated health care program also may be
7 offered indemnity insurance plans, subject to availability.
8 For purposes of this Section, a "managed health care
9 entity" means a health maintenance organization or a managed
10 care community network as defined in this Section. A "health
11 maintenance organization" means a health maintenance
12 organization as defined in the Health Maintenance
13 Organization Act. A "managed care community network" means
14 an entity, other than a health maintenance organization, that
15 is owned, operated, or governed by providers of health care
16 services within this State and that provides or arranges
17 primary, secondary, and tertiary managed health care services
18 under contract with the Illinois Department exclusively to
19 enrollees of the integrated health care program. A managed
20 care community network may contract with the Illinois
21 Department to provide only pediatric health care services. A
22 county provider as defined in Section 15-1 of this Code may
23 contract with the Illinois Department to provide services to
24 enrollees of the integrated health care program as a managed
25 care community network without the need to establish a
26 separate entity that provides services exclusively to
27 enrollees of the integrated health care program and shall be
28 deemed a managed care community network for purposes of this
29 Code only to the extent of the provision of services to those
30 enrollees in conjunction with the integrated health care
31 program. A county provider shall be entitled to contract
32 with the Illinois Department with respect to any contracting
33 region located in whole or in part within the county. A
34 county provider shall not be required to accept enrollees who
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1 do not reside within the county.
2 Each managed care community network must demonstrate its
3 ability to bear the financial risk of serving enrollees under
4 this program. The Illinois Department shall by rule adopt
5 criteria for assessing the financial soundness of each
6 managed care community network. These rules shall consider
7 the extent to which a managed care community network is
8 comprised of providers who directly render health care and
9 are located within the community in which they seek to
10 contract rather than solely arrange or finance the delivery
11 of health care. These rules shall further consider a variety
12 of risk-bearing and management techniques, including the
13 sufficiency of quality assurance and utilization management
14 programs and whether a managed care community network has
15 sufficiently demonstrated its financial solvency and net
16 worth. The Illinois Department's criteria must be based on
17 sound actuarial, financial, and accounting principles. In
18 adopting these rules, the Illinois Department shall consult
19 with the Illinois Department of Insurance. The Illinois
20 Department is responsible for monitoring compliance with
21 these rules.
22 This Section may not be implemented before the effective
23 date of these rules, the approval of any necessary federal
24 waivers, and the completion of the review of an application
25 submitted, at least 60 days before the effective date of
26 rules adopted under this Section, to the Illinois Department
27 by a managed care community network.
28 All health care delivery systems that contract with the
29 Illinois Department under the integrated health care program
30 shall clearly recognize a health care provider's right of
31 conscience under the Right of Conscience Act. In addition to
32 the provisions of that Act, no health care delivery system
33 that contracts with the Illinois Department under the
34 integrated health care program shall be required to provide,
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1 arrange for, or pay for any health care or medical service,
2 procedure, or product if that health care delivery system is
3 owned, controlled, or sponsored by or affiliated with a
4 religious institution or religious organization that finds
5 that health care or medical service, procedure, or product to
6 violate its religious and moral teachings and beliefs.
7 (b) The Illinois Department may, by rule, provide for
8 different benefit packages for different categories of
9 persons enrolled in the program. Mental health services,
10 alcohol and substance abuse services, services related to
11 children with chronic or acute conditions requiring
12 longer-term treatment and follow-up, and rehabilitation care
13 provided by a free-standing rehabilitation hospital or a
14 hospital rehabilitation unit may be excluded from a benefit
15 package if the State ensures that those services are made
16 available through a separate delivery system. An exclusion
17 does not prohibit the Illinois Department from developing and
18 implementing demonstration projects for categories of persons
19 or services. Benefit packages for persons eligible for
20 medical assistance under Articles V, VI, and XII shall be
21 based on the requirements of those Articles and shall be
22 consistent with the Title XIX of the Social Security Act.
23 Nothing in this Act shall be construed to apply to services
24 purchased by the Department of Children and Family Services
25 and the Department of Human Services (as successor to the
26 Department of Mental Health and Developmental Disabilities)
27 under the provisions of Title 59 of the Illinois
28 Administrative Code, Part 132 ("Medicaid Community Mental
29 Health Services Program").
30 (c) The program established by this Section may be
31 implemented by the Illinois Department in various contracting
32 areas at various times. The health care delivery systems and
33 providers available under the program may vary throughout the
34 State. For purposes of contracting with managed health care
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1 entities and providers, the Illinois Department shall
2 establish contracting areas similar to the geographic areas
3 designated by the Illinois Department for contracting
4 purposes under the Illinois Competitive Access and
5 Reimbursement Equity Program (ICARE) under the authority of
6 Section 3-4 of the Illinois Health Finance Reform Act or
7 similarly-sized or smaller geographic areas established by
8 the Illinois Department by rule. A managed health care entity
9 shall be permitted to contract in any geographic areas for
10 which it has a sufficient provider network and otherwise
11 meets the contracting terms of the State. The Illinois
12 Department is not prohibited from entering into a contract
13 with a managed health care entity at any time.
14 (d) A managed health care entity that contracts with the
15 Illinois Department for the provision of services under the
16 program shall do all of the following, solely for purposes of
17 the integrated health care program:
18 (1) Provide that any individual physician licensed
19 to practice medicine in all its branches, any pharmacy,
20 any federally qualified health center, and any
21 podiatrist, that consistently meets the reasonable terms
22 and conditions established by the managed health care
23 entity, including but not limited to credentialing
24 standards, quality assurance program requirements,
25 utilization management requirements, financial
26 responsibility standards, contracting process
27 requirements, and provider network size and accessibility
28 requirements, must be accepted by the managed health care
29 entity for purposes of the Illinois integrated health
30 care program. Any individual who is either terminated
31 from or denied inclusion in the panel of physicians of
32 the managed health care entity shall be given, within 10
33 business days after that determination, a written
34 explanation of the reasons for his or her exclusion or
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1 termination from the panel. This paragraph (1) does not
2 apply to the following:
3 (A) A managed health care entity that
4 certifies to the Illinois Department that:
5 (i) it employs on a full-time basis 125
6 or more Illinois physicians licensed to
7 practice medicine in all of its branches; and
8 (ii) it will provide medical services
9 through its employees to more than 80% of the
10 recipients enrolled with the entity in the
11 integrated health care program; or
12 (B) A domestic stock insurance company
13 licensed under clause (b) of class 1 of Section 4 of
14 the Illinois Insurance Code if (i) at least 66% of
15 the stock of the insurance company is owned by a
16 professional corporation organized under the
17 Professional Service Corporation Act that has 125 or
18 more shareholders who are Illinois physicians
19 licensed to practice medicine in all of its branches
20 and (ii) the insurance company certifies to the
21 Illinois Department that at least 80% of those
22 physician shareholders will provide services to
23 recipients enrolled with the company in the
24 integrated health care program.
25 (2) Provide for reimbursement for providers for
26 emergency care, as defined by the Illinois Department by
27 rule, that must be provided to its enrollees, including
28 an emergency room screening fee, and urgent care that it
29 authorizes for its enrollees, regardless of the
30 provider's affiliation with the managed health care
31 entity. Providers shall be reimbursed for emergency care
32 at an amount equal to the Illinois Department's
33 fee-for-service rates for those medical services rendered
34 by providers not under contract with the managed health
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1 care entity to enrollees of the entity.
2 (3) Provide that any provider affiliated with a
3 managed health care entity may also provide services on a
4 fee-for-service basis to Illinois Department clients not
5 enrolled in a managed health care entity.
6 (4) Provide client education services as determined
7 and approved by the Illinois Department, including but
8 not limited to (i) education regarding appropriate
9 utilization of health care services in a managed care
10 system, (ii) written disclosure of treatment policies and
11 any restrictions or limitations on health services,
12 including, but not limited to, physical services,
13 clinical laboratory tests, hospital and surgical
14 procedures, prescription drugs and biologics, and
15 radiological examinations, and (iii) written notice that
16 the enrollee may receive from another provider those
17 services covered under this program that are not provided
18 by the managed health care entity.
19 (5) Provide that enrollees within its system may
20 choose the site for provision of services and the panel
21 of health care providers.
22 (6) Not discriminate in its enrollment or
23 disenrollment practices among recipients of medical
24 services or program enrollees based on health status.
25 (7) Provide a quality assurance and utilization
26 review program that (i) for health maintenance
27 organizations meets the requirements of the Health
28 Maintenance Organization Act and (ii) for managed care
29 community networks meets the requirements established by
30 the Illinois Department in rules that incorporate those
31 standards set forth in the Health Maintenance
32 Organization Act.
33 (8) Issue a managed health care entity
34 identification card to each enrollee upon enrollment.
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1 The card must contain all of the following:
2 (A) The enrollee's signature.
3 (B) The enrollee's health plan.
4 (C) The name and telephone number of the
5 enrollee's primary care physician.
6 (D) A telephone number to be used for
7 emergency service 24 hours per day, 7 days per week.
8 The telephone number required to be maintained
9 pursuant to this subparagraph by each managed health
10 care entity shall, at minimum, be staffed by
11 medically trained personnel and be provided
12 directly, or under arrangement, at an office or
13 offices in locations maintained solely within the
14 State of Illinois. For purposes of this
15 subparagraph, "medically trained personnel" means
16 licensed practical nurses or registered nurses
17 located in the State of Illinois who are licensed
18 pursuant to the Illinois Nursing Act of 1987.
19 (9) Ensure that every primary care physician and
20 pharmacy in the managed health care entity meets the
21 standards established by the Illinois Department for
22 accessibility and quality of care. The Illinois
23 Department shall arrange for and oversee an evaluation of
24 the standards established under this paragraph (9) and
25 may recommend any necessary changes to these standards.
26 The Illinois Department shall submit an annual report to
27 the Governor and the General Assembly by April 1 of each
28 year regarding the effect of the standards on ensuring
29 access and quality of care to enrollees.
30 (10) Provide a procedure for handling complaints
31 that (i) for health maintenance organizations meets the
32 requirements of the Health Maintenance Organization Act
33 and (ii) for managed care community networks meets the
34 requirements established by the Illinois Department in
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1 rules that incorporate those standards set forth in the
2 Health Maintenance Organization Act.
3 (11) Maintain, retain, and make available to the
4 Illinois Department records, data, and information, in a
5 uniform manner determined by the Illinois Department,
6 sufficient for the Illinois Department to monitor
7 utilization, accessibility, and quality of care.
8 (12) Except for providers who are prepaid, pay all
9 approved claims for covered services that are completed
10 and submitted to the managed health care entity within 30
11 days after receipt of the claim or receipt of the
12 appropriate capitation payment or payments by the managed
13 health care entity from the State for the month in which
14 the services included on the claim were rendered,
15 whichever is later. If payment is not made or mailed to
16 the provider by the managed health care entity by the due
17 date under this subsection, an interest penalty of 1% of
18 any amount unpaid shall be added for each month or
19 fraction of a month after the due date, until final
20 payment is made. Nothing in this Section shall prohibit
21 managed health care entities and providers from mutually
22 agreeing to terms that require more timely payment.
23 (12.5) Ensure that no payment is made to a
24 physician or other provider of services for withholding
25 from an enrollee any necessary or appropriate care
26 because of the cost of that care.
27 (13) Provide integration with community-based
28 programs provided by certified local health departments
29 such as Women, Infants, and Children Supplemental Food
30 Program (WIC), childhood immunization programs, health
31 education programs, case management programs, and health
32 screening programs.
33 (14) Provide that the pharmacy formulary used by a
34 managed health care entity and its contract providers be
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1 no more restrictive than the Illinois Department's
2 pharmaceutical program on the effective date of this
3 amendatory Act of 1994 and as amended after that date.
4 (15) Provide integration with community-based
5 organizations, including, but not limited to, any
6 organization that has operated within a Medicaid
7 Partnership as defined by this Code or by rule of the
8 Illinois Department, that may continue to operate under a
9 contract with the Illinois Department or a managed health
10 care entity under this Section to provide case management
11 services to Medicaid clients in designated high-need
12 areas.
13 The Illinois Department may, by rule, determine
14 methodologies to limit financial liability for managed health
15 care entities resulting from payment for services to
16 enrollees provided under the Illinois Department's integrated
17 health care program. Any methodology so determined may be
18 considered or implemented by the Illinois Department through
19 a contract with a managed health care entity under this
20 integrated health care program.
21 The Illinois Department shall contract with an entity or
22 entities to provide external peer-based quality assurance
23 review for the integrated health care program. The entity
24 shall be representative of Illinois physicians licensed to
25 practice medicine in all its branches and have statewide
26 geographic representation in all specialties of medical care
27 that are provided within the integrated health care program.
28 The entity may not be a third party payer and shall maintain
29 offices in locations around the State in order to provide
30 service and continuing medical education to physician
31 participants within the integrated health care program. The
32 review process shall be developed and conducted by Illinois
33 physicians licensed to practice medicine in all its branches.
34 In consultation with the entity, the Illinois Department may
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1 contract with other entities for professional peer-based
2 quality assurance review of individual categories of services
3 other than services provided, supervised, or coordinated by
4 physicians licensed to practice medicine in all its branches.
5 The Illinois Department shall establish, by rule, criteria to
6 avoid conflicts of interest in the conduct of quality
7 assurance activities consistent with professional peer-review
8 standards. All quality assurance activities shall be
9 coordinated by the Illinois Department.
10 (e) All persons enrolled in the program shall be
11 provided with a full written explanation of all
12 fee-for-service and managed health care plan options and a
13 reasonable opportunity to choose among the options as
14 provided by rule. The Illinois Department shall provide to
15 enrollees, upon enrollment in the integrated health care
16 program and at least annually thereafter, notice of the
17 process for requesting an appeal under the Illinois
18 Department's administrative appeal procedures.
19 Notwithstanding any other Section of this Code, the Illinois
20 Department may provide by rule for the Illinois Department to
21 assign a person enrolled in the program to a specific
22 provider of medical services or to a specific health care
23 delivery system if an enrollee has failed to exercise choice
24 in a timely manner. An enrollee assigned by the Illinois
25 Department shall be afforded the opportunity to disenroll and
26 to select a specific provider of medical services or a
27 specific health care delivery system within the first 30 days
28 after the assignment. An enrollee who has failed to exercise
29 choice in a timely manner may be assigned only if there are 3
30 or more managed health care entities contracting with the
31 Illinois Department within the contracting area, except that,
32 outside the City of Chicago, this requirement may be waived
33 for an area by rules adopted by the Illinois Department after
34 consultation with all hospitals within the contracting area.
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1 The Illinois Department shall establish by rule the procedure
2 for random assignment of enrollees who fail to exercise
3 choice in a timely manner to a specific managed health care
4 entity in proportion to the available capacity of that
5 managed health care entity. Assignment to a specific provider
6 of medical services or to a specific managed health care
7 entity may not exceed that provider's or entity's capacity as
8 determined by the Illinois Department. Any person who has
9 chosen a specific provider of medical services or a specific
10 managed health care entity, or any person who has been
11 assigned under this subsection, shall be given the
12 opportunity to change that choice or assignment at least once
13 every 12 months, as determined by the Illinois Department by
14 rule. The Illinois Department shall maintain a toll-free
15 telephone number for program enrollees' use in reporting
16 problems with managed health care entities.
17 (f) If a person becomes eligible for participation in
18 the integrated health care program while he or she is
19 hospitalized, the Illinois Department may not enroll that
20 person in the program until after he or she has been
21 discharged from the hospital. This subsection does not apply
22 to newborn infants whose mothers are enrolled in the
23 integrated health care program.
24 (g) The Illinois Department shall, by rule, establish
25 for managed health care entities rates that (i) are certified
26 to be actuarially sound, as determined by an actuary who is
27 an associate or a fellow of the Society of Actuaries or a
28 member of the American Academy of Actuaries and who has
29 expertise and experience in medical insurance and benefit
30 programs, in accordance with the Illinois Department's
31 current fee-for-service payment system, and (ii) take into
32 account any difference of cost to provide health care to
33 different populations based on gender, age, location, and
34 eligibility category. The rates for managed health care
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1 entities shall be determined on a capitated basis.
2 The Illinois Department by rule shall establish a method
3 to adjust its payments to managed health care entities in a
4 manner intended to avoid providing any financial incentive to
5 a managed health care entity to refer patients to a county
6 provider, in an Illinois county having a population greater
7 than 3,000,000, that is paid directly by the Illinois
8 Department. The Illinois Department shall by April 1, 1997,
9 and annually thereafter, review the method to adjust
10 payments. Payments by the Illinois Department to the county
11 provider, for persons not enrolled in a managed care
12 community network owned or operated by a county provider,
13 shall be paid on a fee-for-service basis under Article XV of
14 this Code.
15 The Illinois Department by rule shall establish a method
16 to reduce its payments to managed health care entities to
17 take into consideration (i) any adjustment payments paid to
18 hospitals under subsection (h) of this Section to the extent
19 those payments, or any part of those payments, have been
20 taken into account in establishing capitated rates under this
21 subsection (g) and (ii) the implementation of methodologies
22 to limit financial liability for managed health care entities
23 under subsection (d) of this Section.
24 (h) For hospital services provided by a hospital that
25 contracts with a managed health care entity, adjustment
26 payments shall be paid directly to the hospital by the
27 Illinois Department. Adjustment payments may include but
28 need not be limited to adjustment payments to:
29 disproportionate share hospitals under Section 5-5.02 of this
30 Code; primary care access health care education payments (89
31 Ill. Adm. Code 149.140); payments for capital, direct medical
32 education, indirect medical education, certified registered
33 nurse anesthetist, and kidney acquisition costs (89 Ill. Adm.
34 Code 149.150(c)); uncompensated care payments (89 Ill. Adm.
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1 Code 148.150(h)); trauma center payments (89 Ill. Adm. Code
2 148.290(c)); rehabilitation hospital payments (89 Ill. Adm.
3 Code 148.290(d)); perinatal center payments (89 Ill. Adm.
4 Code 148.290(e)); obstetrical care payments (89 Ill. Adm.
5 Code 148.290(f)); targeted access payments (89 Ill. Adm. Code
6 148.290(g)); Medicaid high volume payments (89 Ill. Adm. Code
7 148.290(h)); and outpatient indigent volume adjustments (89
8 Ill. Adm. Code 148.140(b)(5)).
9 (i) For any hospital eligible for the adjustment
10 payments described in subsection (h), the Illinois Department
11 shall maintain, through the period ending June 30, 1995,
12 reimbursement levels in accordance with statutes and rules in
13 effect on April 1, 1994.
14 (j) Nothing contained in this Code in any way limits or
15 otherwise impairs the authority or power of the Illinois
16 Department to enter into a negotiated contract pursuant to
17 this Section with a managed health care entity, including,
18 but not limited to, a health maintenance organization, that
19 provides for termination or nonrenewal of the contract
20 without cause upon notice as provided in the contract and
21 without a hearing.
22 (k) Section 5-5.15 does not apply to the program
23 developed and implemented pursuant to this Section.
24 (l) The Illinois Department shall, by rule, define those
25 chronic or acute medical conditions of childhood that require
26 longer-term treatment and follow-up care. The Illinois
27 Department shall ensure that services required to treat these
28 conditions are available through a separate delivery system.
29 A managed health care entity that contracts with the
30 Illinois Department may refer a child with medical conditions
31 described in the rules adopted under this subsection directly
32 to a children's hospital or to a hospital, other than a
33 children's hospital, that is qualified to provide inpatient
34 and outpatient services to treat those conditions. The
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1 Illinois Department shall provide fee-for-service
2 reimbursement directly to a children's hospital for those
3 services pursuant to Title 89 of the Illinois Administrative
4 Code, Section 148.280(a), at a rate at least equal to the
5 rate in effect on March 31, 1994. For hospitals, other than
6 children's hospitals, that are qualified to provide inpatient
7 and outpatient services to treat those conditions, the
8 Illinois Department shall provide reimbursement for those
9 services on a fee-for-service basis, at a rate at least equal
10 to the rate in effect for those other hospitals on March 31,
11 1994.
12 A children's hospital shall be directly reimbursed for
13 all services provided at the children's hospital on a
14 fee-for-service basis pursuant to Title 89 of the Illinois
15 Administrative Code, Section 148.280(a), at a rate at least
16 equal to the rate in effect on March 31, 1994, until the
17 later of (i) implementation of the integrated health care
18 program under this Section and development of actuarially
19 sound capitation rates for services other than those chronic
20 or acute medical conditions of childhood that require
21 longer-term treatment and follow-up care as defined by the
22 Illinois Department in the rules adopted under this
23 subsection or (ii) March 31, 1996.
24 Notwithstanding anything in this subsection to the
25 contrary, a managed health care entity shall not consider
26 sources or methods of payment in determining the referral of
27 a child. The Illinois Department shall adopt rules to
28 establish criteria for those referrals. The Illinois
29 Department by rule shall establish a method to adjust its
30 payments to managed health care entities in a manner intended
31 to avoid providing any financial incentive to a managed
32 health care entity to refer patients to a provider who is
33 paid directly by the Illinois Department.
34 (m) Behavioral health services provided or funded by the
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1 Department of Human Services, the Department of Children and
2 Family Services, and the Illinois Department shall be
3 excluded from a benefit package. Conditions of an organic or
4 physical origin or nature, including medical detoxification,
5 however, may not be excluded. In this subsection,
6 "behavioral health services" means mental health services and
7 subacute alcohol and substance abuse treatment services, as
8 defined in the Illinois Alcoholism and Other Drug Dependency
9 Act. In this subsection, "mental health services" includes,
10 at a minimum, the following services funded by the Illinois
11 Department, the Department of Human Services (as successor to
12 the Department of Mental Health and Developmental
13 Disabilities), or the Department of Children and Family
14 Services: (i) inpatient hospital services, including related
15 physician services, related psychiatric interventions, and
16 pharmaceutical services provided to an eligible recipient
17 hospitalized with a primary diagnosis of psychiatric
18 disorder; (ii) outpatient mental health services as defined
19 and specified in Title 59 of the Illinois Administrative
20 Code, Part 132; (iii) any other outpatient mental health
21 services funded by the Illinois Department pursuant to the
22 State of Illinois Medicaid Plan; (iv) partial
23 hospitalization; and (v) follow-up stabilization related to
24 any of those services. Additional behavioral health services
25 may be excluded under this subsection as mutually agreed in
26 writing by the Illinois Department and the affected State
27 agency or agencies. The exclusion of any service does not
28 prohibit the Illinois Department from developing and
29 implementing demonstration projects for categories of persons
30 or services. The Department of Children and Family Services
31 and the Department of Human Services shall each adopt rules
32 governing the integration of managed care in the provision of
33 behavioral health services. The State shall integrate managed
34 care community networks and affiliated providers, to the
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1 extent practicable, in any separate delivery system for
2 mental health services.
3 (n) The Illinois Department shall adopt rules to
4 establish reserve requirements for managed care community
5 networks, as required by subsection (a), and health
6 maintenance organizations to protect against liabilities in
7 the event that a managed health care entity is declared
8 insolvent or bankrupt. If a managed health care entity other
9 than a county provider is declared insolvent or bankrupt,
10 after liquidation and application of any available assets,
11 resources, and reserves, the Illinois Department shall pay a
12 portion of the amounts owed by the managed health care entity
13 to providers for services rendered to enrollees under the
14 integrated health care program under this Section based on
15 the following schedule: (i) from April 1, 1995 through June
16 30, 1998, 90% of the amounts owed; (ii) from July 1, 1998
17 through June 30, 2001, 80% of the amounts owed; and (iii)
18 from July 1, 2001 through June 30, 2005, 75% of the amounts
19 owed. The amounts paid under this subsection shall be
20 calculated based on the total amount owed by the managed
21 health care entity to providers before application of any
22 available assets, resources, and reserves. After June 30,
23 2005, the Illinois Department may not pay any amounts owed to
24 providers as a result of an insolvency or bankruptcy of a
25 managed health care entity occurring after that date. The
26 Illinois Department is not obligated, however, to pay amounts
27 owed to a provider that has an ownership or other governing
28 interest in the managed health care entity. This subsection
29 applies only to managed health care entities and the services
30 they provide under the integrated health care program under
31 this Section.
32 (o) Notwithstanding any other provision of law or
33 contractual agreement to the contrary, providers shall not be
34 required to accept from any other third party payer the rates
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1 determined or paid under this Code by the Illinois
2 Department, managed health care entity, or other health care
3 delivery system for services provided to recipients.
4 (p) The Illinois Department may seek and obtain any
5 necessary authorization provided under federal law to
6 implement the program, including the waiver of any federal
7 statutes or regulations. The Illinois Department may seek a
8 waiver of the federal requirement that the combined
9 membership of Medicare and Medicaid enrollees in a managed
10 care community network may not exceed 75% of the managed care
11 community network's total enrollment. The Illinois
12 Department shall not seek a waiver of this requirement for
13 any other category of managed health care entity. The
14 Illinois Department shall not seek a waiver of the inpatient
15 hospital reimbursement methodology in Section 1902(a)(13)(A)
16 of Title XIX of the Social Security Act even if the federal
17 agency responsible for administering Title XIX determines
18 that Section 1902(a)(13)(A) applies to managed health care
19 systems.
20 Notwithstanding any other provisions of this Code to the
21 contrary, the Illinois Department shall seek a waiver of
22 applicable federal law in order to impose a co-payment system
23 consistent with this subsection on recipients of medical
24 services under Title XIX of the Social Security Act who are
25 not enrolled in a managed health care entity. The waiver
26 request submitted by the Illinois Department shall provide
27 for co-payments of up to $0.50 for prescribed drugs and up to
28 $0.50 for x-ray services and shall provide for co-payments of
29 up to $10 for non-emergency services provided in a hospital
30 emergency room and up to $10 for non-emergency ambulance
31 services. The purpose of the co-payments shall be to deter
32 those recipients from seeking unnecessary medical care.
33 Co-payments may not be used to deter recipients from seeking
34 necessary medical care. No recipient shall be required to
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1 pay more than a total of $150 per year in co-payments under
2 the waiver request required by this subsection. A recipient
3 may not be required to pay more than $15 of any amount due
4 under this subsection in any one month.
5 Co-payments authorized under this subsection may not be
6 imposed when the care was necessitated by a true medical
7 emergency. Co-payments may not be imposed for any of the
8 following classifications of services:
9 (1) Services furnished to person under 18 years of
10 age.
11 (2) Services furnished to pregnant women.
12 (3) Services furnished to any individual who is an
13 inpatient in a hospital, nursing facility, intermediate
14 care facility, or other medical institution, if that
15 person is required to spend for costs of medical care all
16 but a minimal amount of his or her income required for
17 personal needs.
18 (4) Services furnished to a person who is receiving
19 hospice care.
20 Co-payments authorized under this subsection shall not be
21 deducted from or reduce in any way payments for medical
22 services from the Illinois Department to providers. No
23 provider may deny those services to an individual eligible
24 for services based on the individual's inability to pay the
25 co-payment.
26 Recipients who are subject to co-payments shall be
27 provided notice, in plain and clear language, of the amount
28 of the co-payments, the circumstances under which co-payments
29 are exempted, the circumstances under which co-payments may
30 be assessed, and their manner of collection.
31 The Illinois Department shall establish a Medicaid
32 Co-Payment Council to assist in the development of co-payment
33 policies for the medical assistance program. The Medicaid
34 Co-Payment Council shall also have jurisdiction to develop a
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1 program to provide financial or non-financial incentives to
2 Medicaid recipients in order to encourage recipients to seek
3 necessary health care. The Council shall be chaired by the
4 Director of the Illinois Department, and shall have 6
5 additional members. Two of the 6 additional members shall be
6 appointed by the Governor, and one each shall be appointed by
7 the President of the Senate, the Minority Leader of the
8 Senate, the Speaker of the House of Representatives, and the
9 Minority Leader of the House of Representatives. The Council
10 may be convened and make recommendations upon the appointment
11 of a majority of its members. The Council shall be appointed
12 and convened no later than September 1, 1994 and shall report
13 its recommendations to the Director of the Illinois
14 Department and the General Assembly no later than October 1,
15 1994. The chairperson of the Council shall be allowed to
16 vote only in the case of a tie vote among the appointed
17 members of the Council.
18 The Council shall be guided by the following principles
19 as it considers recommendations to be developed to implement
20 any approved waivers that the Illinois Department must seek
21 pursuant to this subsection:
22 (1) Co-payments should not be used to deter access
23 to adequate medical care.
24 (2) Co-payments should be used to reduce fraud.
25 (3) Co-payment policies should be examined in
26 consideration of other states' experience, and the
27 ability of successful co-payment plans to control
28 unnecessary or inappropriate utilization of services
29 should be promoted.
30 (4) All participants, both recipients and
31 providers, in the medical assistance program have
32 responsibilities to both the State and the program.
33 (5) Co-payments are primarily a tool to educate the
34 participants in the responsible use of health care
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1 resources.
2 (6) Co-payments should not be used to penalize
3 providers.
4 (7) A successful medical program requires the
5 elimination of improper utilization of medical resources.
6 The integrated health care program, or any part of that
7 program, established under this Section may not be
8 implemented if matching federal funds under Title XIX of the
9 Social Security Act are not available for administering the
10 program.
11 The Illinois Department shall submit for publication in
12 the Illinois Register the name, address, and telephone number
13 of the individual to whom a request may be directed for a
14 copy of the request for a waiver of provisions of Title XIX
15 of the Social Security Act that the Illinois Department
16 intends to submit to the Health Care Financing Administration
17 in order to implement this Section. The Illinois Department
18 shall mail a copy of that request for waiver to all
19 requestors at least 16 days before filing that request for
20 waiver with the Health Care Financing Administration.
21 (q) After the effective date of this Section, the
22 Illinois Department may take all planning and preparatory
23 action necessary to implement this Section, including, but
24 not limited to, seeking requests for proposals relating to
25 the integrated health care program created under this
26 Section.
27 (r) In order to (i) accelerate and facilitate the
28 development of integrated health care in contracting areas
29 outside counties with populations in excess of 3,000,000 and
30 counties adjacent to those counties and (ii) maintain and
31 sustain the high quality of education and residency programs
32 coordinated and associated with local area hospitals, the
33 Illinois Department may develop and implement a demonstration
34 program for managed care community networks owned, operated,
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1 or governed by State-funded medical schools. The Illinois
2 Department shall prescribe by rule the criteria, standards,
3 and procedures for effecting this demonstration program.
4 (s) (Blank).
5 (t) On April 1, 1995 and every 6 months thereafter, the
6 Illinois Department shall report to the Governor and General
7 Assembly on the progress of the integrated health care
8 program in enrolling clients into managed health care
9 entities. The report shall indicate the capacities of the
10 managed health care entities with which the State contracts,
11 the number of clients enrolled by each contractor, the areas
12 of the State in which managed care options do not exist, and
13 the progress toward meeting the enrollment goals of the
14 integrated health care program.
15 (u) The Illinois Department may implement this Section
16 through the use of emergency rules in accordance with Section
17 5-45 of the Illinois Administrative Procedure Act. For
18 purposes of that Act, the adoption of rules to implement this
19 Section is deemed an emergency and necessary for the public
20 interest, safety, and welfare.
21 (Source: P.A. 88-554, eff. 7-26-94; 89-21, eff. 7-1-95;
22 89-507, eff. 7-1-97; 89-673, eff. 8-14-96; revised 8-26-96.)
23 Section 95. No acceleration or delay. Where this Act
24 makes changes in a statute that is represented in this Act by
25 text that is not yet or no longer in effect (for example, a
26 Section represented by multiple versions), the use of that
27 text does not accelerate or delay the taking effect of (i)
28 the changes made by this Act or (ii) provisions derived from
29 any other Public Act.
30 Section 99. Effective date. This Act takes effect upon
31 becoming law.