72nd OREGON LEGISLATIVE ASSEMBLY--2003 Regular Session
SA to SB 1
LC 2413/SB 1-2
SENATE AMENDMENTS TO
SENATE BILL 1
By COMMITTEE ON HEALTH POLICY
May 5
On page 1 of the printed bill, line 2, delete 'and'.
Delete line 3 and insert '743.556; repealing ORS 430.065; and
prescribing an effective date.'.
Delete lines 5 through 30 and delete pages 2 through 7 and
insert:
' { + SECTION 1. + } ORS 743.556 is amended to read:
' 743.556. A group health insurance policy providing coverage
for hospital or medical expenses shall provide coverage for
expenses arising from treatment for chemical dependency { + , + }
including alcoholism { + , + } and for mental or nervous
conditions { + at the same level as, and subject to limitations
no more restrictive than, those imposed on coverage or
reimbursement of expenses arising from treatment for other
medical conditions + }. The following { - conditions apply to
the requirement for - } { + apply to + } such coverage:
' { + (1) As used in this section:
' (a) 'Chemical dependency' means the addictive relationship
with any drug or alcohol characterized by either a physical or
psychological relationship, or both, that interferes on a
recurring basis with the individual's social, psychological or
physical adjustment to common problems. For purposes of this
section, 'chemical dependency' does not include addiction to, or
dependency on, tobacco, tobacco products or foods.
' (b) 'Facility' means a corporate or governmental entity or
other provider of services for the treatment of chemical
dependency or for the treatment of mental or nervous conditions.
' (c) 'Group health insurer' means an insurer, a health
maintenance organization or a health care service contractor.
' (d) 'Program' means a particular type or level of service
that is organizationally distinct within a facility.
' (e) 'Provider' means a person that has met the credentialing
requirement of a group health insurer and is otherwise eligible
to receive reimbursement for coverage under the policy and is:
' (A) A health care facility;
' (B) A residential program or facility;
' (C) A day or partial hospitalization program;
' (D) An outpatient service; or
' (E) An individual behavioral health or medical professional
authorized for reimbursement under Oregon law. + }
' { - (1) - } { + (2) + } The coverage may be made subject
to provisions of the policy that apply to other benefits under
the policy, including but not limited to provisions relating to
deductibles and coinsurance. Deductibles and coinsurance for
treatment in health care facilities or residential programs or
facilities
{ - shall be no - } { + may not be + } greater than those
under the policy for expenses of hospitalization in the treatment
of { - illness - } { + other medical conditions + }.
Deductibles and coinsurance for outpatient treatment { - shall
be no - } { + may not be + } greater than those under the
policy for expenses of outpatient treatment of { - illness - }
{ + other medical conditions + }.
' { + (3) The coverage for chemical dependency and for mental
or nervous conditions may not be made subject to treatment
limitations, limits on total payments for treatment, limits on
duration of treatment or financial requirements unless similar
limitations or requirements are imposed on coverage of other
medical conditions. The coverage of eligible expenses may be
limited to treatment that is medically necessary as determined
under the policy for other medical conditions.
' (4)(a) Nothing in this section requires coverage for:
' (A) Sheltered living, educational or correctional services
provided by a school or halfway house;
' (B) A long-term residential mental health program that lasts
longer than 45 days;
' (C) Psychoanalysis or psychotherapy received as part of an
educational or training program, regardless of diagnosis or
symptoms that may be present;
' (D) A court-ordered sex offender treatment program; or
' (E) A screening interview or treatment program under ORS
813.021.
' (b) Notwithstanding paragraph (a)(A) of this subsection, an
insured may receive covered outpatient services under the terms
of the insured's policy while the insured is living temporarily
in a sheltered living situation. + }
' { - (2) - } { + (5) + } { - Treatment provided in health
care facilities, residential programs or facilities, day or
partial hospitalization programs or outpatient services shall - }
{ + A provider + } { - be considered - } { + is + } eligible
for reimbursement { + under this section + } if { - it is
provided by - } :
' (a) { - Programs or providers described in ORS 430.010
or - } { + The provider + } { + is + } approved by the
Department of Human Services { - under subsection (3) of this
section. - } { + ; + }
' (b) { - Programs - } { + The provider is + } accredited
for the particular level of care for which reimbursement is being
requested by the Joint Commission on Accreditation of Hospitals
or the Commission on Accreditation of Rehabilitation Facilities
{ - . - } { + ; + }
' { - (c) Inpatient programs provided by health care
facilities as defined in ORS 442.015. Residential, outpatient, or
day or partial hospitalization programs offered by or through a
health care facility must meet the requirements of either
paragraph (a) or (b) of this subsection in order to be eligible
for reimbursement. - }
' { - (d) - } { + (c) + } { - Residential programs or
facilities described in subsection (3) of this section if - }
The patient is staying overnight at the facility and is involved
in a structured program at least eight hours per day, five days
per week { - . - } { + ; or
' (d) The provider is providing a covered benefit under the
policy. + }
' { - (e) Programs in which staff are directly supervised or
in which individual client treatment plans are approved by a
person described in ORS 430.010 (4)(a) and which meet the
standards established under subsection (3) of this section. - }
' { - (3) Subject to ORS 430.065, the Department of Human
Services shall adopt rules relating to the approval, for
insurance reimbursement purposes, of noninpatient chemical
dependency programs that are not related to the department or any
county mental health program. The department shall adopt rules
relating to the approval, for insurance reimbursement purposes,
of noninpatient programs for mental or nervous conditions that
are not related to the department or any county mental health
program. - }
' { - (4) A program that provides services for persons with
both a chemical dependency diagnosis and a mental or nervous
condition shall be considered to be a distinct and specialized
type of program for both chemical dependency and mental or
nervous conditions. The Department of Human Services shall
develop specific standards related to such programs for program
approval purposes and shall adopt rules relating to the approval,
for insurance reimbursement purposes, of such noninpatient
programs that are not related to the department and any county
mental health program. - }
' { - (5) As used in this section: - }
' { - (a) 'Chemical dependency' means the addictive
relationship with any drug or alcohol characterized by either a
physical or psychological relationship, or both, that interferes
with the individual's social, psychological or physical
adjustment to common problems on a recurring basis. For purposes
of this section, chemical dependency does not include addiction
to, or dependency on, tobacco, tobacco products or foods. - }
' { - (b) 'Child or adolescent' means a person who is 17 years
of age or younger. - }
' { - (c) 'Facility' means a corporate or governmental entity
or other provider of services for the treatment of chemical
dependency or for the treatment of mental or nervous
conditions. - }
' { - (d) 'Program' means a particular type or level of
service that is organizationally distinct within a facility. - }
' { - (6) Notwithstanding the limits for particular types of
services specified in this section, a policy shall not limit the
total of payments for all treatment of any kind under this
section for chemical dependency, together with payments for all
treatment of any kind for mental or nervous conditions, to less
than $13,125 for adults and $15,625 for children or adolescents.
For persons requesting payments for treatment of any kind for
chemical dependency, but not requesting payments for treatment of
any kind of mental or nervous condition, a policy shall not limit
the total of payments for all treatment to less than $8,125 for
adults and $13,125 for children and adolescents. - }
' { - (7) The limits for mental or nervous conditions
specified in this section shall apply to persons with diagnoses
of both chemical dependency and mental or nervous conditions, who
are being treated for both types of diagnosis, as well as persons
with only a diagnosis of a mental or nervous condition. - }
' { - (8) The higher benefit levels in this section for
children or adolescents are in recognition of the longer period
of treatment and the greater levels of staffing that may be
required for children or adolescents and are intended to permit
more services to meet the needs of children and adolescents. - }
' { - (9) - } { + (6) + } Payments { - shall - }
{ + may + } not be made under this section { - for educational
programs to which drivers are referred by the judicial system,
nor - } for { - volunteer mutual - } support groups.
' { - (10) Except as permitted by subsections (1), (6) and
(12) of this section, the policy shall not limit payments for
inpatient treatment in hospitals and other health care facilities
thereunder: - }
' { - (a) For chemical dependency to an amount less than
$5,625 for adults and $5,000 for children or adolescents; and - }
' { - (b) For mental or nervous conditions to an amount less
than $5,000 for adults and $7,500 for children or
adolescents. - }
' { - (11) Except as permitted by subsections (1), (6) and
(12) of this section, the policy shall not limit payments for
treatment in residential programs or facilities or day or partial
hospitalization programs: - }
' { - (a) For chemical dependency to an amount less than
$4,375 for adults and $3,750 for children or adolescents; and - }
' { - (b) For mental or nervous conditions to an amount less
than $1,250 for adults and $3,125 for children or
adolescents. - }
' { - (12) Notwithstanding the minimum benefits for particular
types of services specified in subsections (10) and (11) of this
section, and except as permitted by subsection (1) of this
section, the policy shall not limit total payments for inpatient,
residential and day or partial hospitalization program care or
treatment: - }
' { - (a) For chemical dependency to an amount less than
$10,625 for children or adolescents; and - }
' { - (b) For mental or nervous conditions to an amount less
than $10,625 for adults and $13,125 for children or
adolescents. - }
' { - (13) Except as permitted by subsections (1) and (6) of
this section, in the case of benefits for outpatient services,
the policy shall not limit payments: - }
' { - (a) For chemical dependency to an amount less than
$1,875 for adults and $2,500 for children or adolescents; and - }
' { - (b) For mental or nervous conditions to an amount less
than $2,500. - }
' { - (14) - } { + (7) + } If { - so - } specified in the
policy, outpatient coverage may include follow-up in-home service
{ - associated with any health care facility, residential, day
or partial hospitalization - } or outpatient services. The
policy may limit coverage for in-home service to persons who
{ - have completed their initial health care facility,
residential, day or partial hospitalization or outpatient
treatment and did not terminate that initial treatment against
advice - } { + are homebound under the care of a physician + }.
{ - The policy may also limit coverage for in-home service by
defining the circumstances of need under which payment will or
will not be made. - }
' { + (8) Nothing in this section prohibits a group health
insurer from managing the provision of benefits through common
methods, including but not limited to selectively contracted
panels, health plan benefit differential designs, preadmission
screening, prior authorization of services, utilization review or
other mechanisms designed to limit eligible expenses to those
described in subsection (3) of this section. + }
' { - (15) - } { + (9) + } { - Under ORS 430.021 and
430.315, - } The Legislative Assembly has found that health care
cost containment is necessary and intends to encourage insurance
policies designed to achieve cost containment by assuring that
reimbursement is limited to appropriate utilization under
criteria incorporated into such policies, either directly or by
reference.
' { - (16) A group health insurance policy may provide, with
respect to treatment for chemical dependency or mental or nervous
conditions, that any one or more of the following cost
containment methods shall be in effect and the method or methods
used by an insurer in one part of the state may be different from
the method or methods used by that insurer in another part of the
state: - }
' { - (a) Proportion of coinsurance required for treatment in
residential programs or facilities, day or partial
hospitalization programs or outpatient services less than the
proportion of coinsurance required for treatment in health care
facilities. - }
' { - (b) - } { + (10)(a) + } Subject to the patient or
client confidentiality provisions of ORS 40.235 relating to
physicians, ORS 40.240 relating to nurse practitioners, ORS
40.230 relating to psychologists and ORS 40.250 and 675.580
relating to licensed clinical social workers, { + a group health
insurer may provide for + } review for level of treatment of
admissions and continued stays for treatment in health care
facilities, residential programs or facilities, day or partial
hospitalization programs and outpatient services by either
{ + group health + } insurer staff or personnel under contract
to the { + group health + } insurer, or by a utilization review
contractor, who shall have the authority to certify for or deny
level of payment:
' { - (A) - } { + (b) + } { - This - } Review shall be
made according to criteria made available to providers in advance
upon request.
' { - (B) To facilitate implementation of utilization review
programs by insurers, the Director of Human Services shall draft
an advisory or model set of criteria for appropriate utilization
of inpatient, residential, day or partial hospitalization, and
outpatient facilities, programs and services by adults, children
and adolescents, and persons with both a chemical dependency
diagnosis and a mental or nervous condition. These criteria shall
be consistent with this section and shall not be binding on any
insurer or other party. However, at the time of contract
negotiation or amendment, with the agreement of the parties to
the contract, any insurer may adopt the criteria or similar
criteria with or without modification. The director shall revise
these criteria at least every two years. In developing and
revising these criteria, the director shall organize a technical
advisory panel including representatives of the Department of
Consumer and Business Services, the Department of Human Services,
the insurance industry, the business community and providers of
each level of care. The director shall place substantial weight
on the advice of this panel. - }
' { - (C) - } { + (c) + } Review shall be performed by or
under the direction of a medical or osteopathic physician
licensed by the Board of Medical Examiners for the State of
Oregon; a psychologist licensed by the State Board of
Psychologist Examiners; { - a nurse practitioner registered by
the Oregon State Board of Nursing; - } or a clinical social
worker licensed by the State Board of Clinical Social Workers,
{ + in accordance with standards of the National Committee for
Quality Assurance or Medicare review standards of the Centers for
Medicare and Medicaid Services. + } { - with physician
consultation readily available. The reviewer shall have expertise
in the evaluation of mental or nervous condition services or
chemical dependency services. - }
' { - (D) - } { + (d) + } Review may involve prior approval,
concurrent review of the continuation of treatment,
post-treatment review or any combination of these. However, if
prior approval is required, provision shall be made to allow for
payment of urgent or emergency admissions, subject to subsequent
review. If prior approval is not required, { + group health + }
insurers shall permit treatment providers, policyholders or
persons acting on their behalf to make advance inquiries
regarding the appropriateness of a particular admission to a
treatment program. { + Group health + } insurers shall provide a
timely response to such inquiries.
{ - Approval of a particular admission does not represent a
guarantee of future payment. - } { + Noncontracting providers
must cooperate with these procedures to the same extent as
contracting providers to be eligible for reimbursement. + }
' { - (E) An appeals process shall be provided. - }
' { - (F) An insurer may choose to review all providers on a
sampling or audit basis only; or to review on a less frequent
basis those providers who consistently supply full documentation,
consistent with confidentiality statutes on each case in a timely
fashion to the insurer. - }
' { - (17) For purposes of subsection (16)(b) of this section,
a utilization review contractor is a professional review
organization or similar entity which, under contract with an
insurance carrier, performs certification of reimbursability of
level of treatment for admissions and maintained stays in
treatment programs, facilities or services. - }
' { - (18) For purposes of subsection (16)(b) of this section,
when implemented through an insurance contract, reimbursability
of inpatient treatment requires demonstration that medical
circumstances require 24-hour nursing care, or physician or nurse
assessment, treatment or supervision that cannot be readily made
available on an outpatient basis, or in: - }
' { - (a) The current living situation; - }
' { - (b) An alternative, nontreatment living situation; - }
' { - (c) An alternative residential program or facility;
or - }
' { - (d) A day or partial hospitalization program. - }
' { - (19) For purposes of subsection (16)(b) of this section,
when implemented through an insurance contract, reimbursability
of treatment at the residential, day or partial hospitalization
level of treatment shall require demonstration that outpatient
services, if appropriate and less costly than residential, day or
partial hospitalization services: - }
' { - (a) Are not presently appropriate and available; - }
' { - (b) Cannot be readily and timely made available; and - }
' { - (c) Cannot meet documented needs for nonmedical
supervision, protection, assistance and treatment, either in the
current living situation or in a readily and timely available
alternative, nontreatment living situation, taking into account
the extent of both the available positive support and existing
negative influences in the occupational, social and living
situations; risks to self or others; and readiness to participate
consistently in treatment. - }
' { - (20) For purposes of subsection (16)(b) of this section,
reimbursability of treatment at the level for outpatient
facility, service or program shall require demonstration that
treatment is justified, considering the individual's history, and
the current medical, occupational, social and psychological
situation, and the overall prognosis. - }
' { - (21) Discrete medical or neurologic diagnostic or
treatment services including any professional component of that
service, costing in excess of $300, occurring concurrently with
but not directly related to treatment of mental or nervous
conditions shall not be charged against the inpatient benefit
level. - }
' { - (22) The benefits described in this section shall renew
in full either on the first day of the 25th month of coverage
following the first use of services for the treatment of chemical
dependency or mental or nervous conditions, or both, or on the
first day following two consecutive contract years. - }
' { - (23) Health maintenance organizations, as defined in ORS
750.005 (3), shall be subject to the following conditions and
requirements in their provision of benefits for chemical
dependency or mental or nervous conditions to enrollees: - }
' { - (a) Notwithstanding the provisions of subsection (1) of
this section, health maintenance organizations may establish
reasonable provisions for enrollee cost-sharing, so long as the
amount the enrollee is required to pay does not exceed the amount
of coinsurance and deductible customarily required by other
insurance policies which are subject to the provisions of this
chapter for that type and level of service. - }
' { - (b) Nothing in this section prevents health maintenance
organizations from establishing durational limits which are
actuarially equivalent to the benefits required by this
section. - }
' { - (c) - } { + (11) + } Health maintenance organizations
may limit the receipt of covered services by enrollees to
services provided by or upon referral by providers
{ - associated - } { + contracting + } with the health
maintenance organization. { + Health maintenance organizations
and health care service contractors may create substantive plan
benefit and reimbursement differentials at the same level as, and
subject to limitations no more restrictive than, those imposed on
coverage or reimbursement of expenses arising out of other
medical conditions and apply them to contracting and
noncontracting providers. + }
' { - (d) The Department of Human Services shall make rules
establishing objective and quantifiable criteria for determining
when a health maintenance organization meets the conditions and
requirements of this subsection. - }
' { - (24) - } { + (12) + } Nothing in this section
{ - shall prevent - } { + prevents + } { - an - } { + a
group health + } insurer { - or health care service contractor
other than a health maintenance organization, except as provided
in subsection (23) of this section, - } from contracting with
providers of health care services to furnish services to
policyholders or certificate holders according to ORS 743.531 or
750.005, subject to the following conditions:
' { - (a) An insurer or health care service contractor may
establish limits for contracted services which are actuarially
equivalent to the benefits required by this section, so long as
the same range of treatment settings is made available. - }
' { - (b) An insurer or health care service contractor, other
than a health maintenance organization, may negotiate with
contracting providers as to the cost of actuarially equivalent
benefits, and such actuarially equivalent benefits for services
of contracting providers shall be deemed to equal the minimum
benefit levels specified in this section. - }
' { - (c) - } { + (a) + } { - An - } { + A group
health + } insurer { - or health care service contractor - }
is not required to contract with all eligible providers { - ,
and payment for covered services of contracting providers may be
in alternative methods or amounts rather than as specified in
this section - } .
' { - (d) - } { + (b) + } { - Insurers and health care
service contractors other than health maintenance
organizations - } { + An insurer or health care services
contractor + } shall { + , subject to subsections (2) and (3) of
this section, + } pay benefits toward the covered charges of
noncontracting providers of services for the treatment of
chemical dependency or mental or nervous conditions { - at the
same level of deductible or coinsurance as would apply to covered
charges of noncontracting providers of other health services
under the same group policy or contract - } . The insured
shall { + , subject to subsections (2) and (3) of this
section, + } have the right to use the services of a
noncontracting provider of services for the treatment of chemical
dependency or mental or nervous conditions { + , + }
{ - . Policies described in this subsection shall be subject to
the provisions of subsection (1) of this section, - } whether or
not the services for chemical dependency or mental or nervous
conditions are provided by contracting or noncontracting
providers.
' { - (e) The department shall make rules establishing
objective and quantifiable criteria for determining that a
contract meets the conditions and requirements of this subsection
and that actuarially equivalent services of contracting providers
equal or exceed services obtainable with the minimum benefits
specified in this section. - }
' { - (25) - } { + (13) + } The intent of the Legislative
Assembly in adopting this section is to reserve benefits for
different types of care to encourage cost effective care and to
assure continuing access to levels of care most appropriate for
the insured's condition and progress.
' { - (26) - } { + (14) + } The { - director - } { +
Director of the Department of Consumer and Business Services + },
after notice and hearing, may adopt reasonable rules not
inconsistent with this section that are considered necessary for
the proper administration of these provisions.
' { + SECTION 2. + } { + ORS 430.065 is repealed. + }
' { + SECTION 3. + } { + The amendments to ORS 743.556 by
section 1 of this 2003 Act apply to group health insurance
policies issued or renewed on or after January 1, 2005. + }
' { + SECTION 4. + } { + This 2003 Act takes effect on
January 1, 2005. + } ' .
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