74th OREGON LEGISLATIVE ASSEMBLY--2007 Regular Session
 
NOTE:  Matter within  { +  braces and plus signs + } in an
amended section is new. Matter within  { -  braces and minus
signs - } is existing law to be omitted. New sections are within
 { +  braces and plus signs + } .
 
LC 576
 
                         House Bill 2213
 
Ordered printed by the Speaker pursuant to House Rule 12.00A (5).
  Presession filed (at the request of Governor Theodore R.
  Kulongoski for Department of Consumer and Business Services)
 
 
                             SUMMARY
 
The following summary is not prepared by the sponsors of the
measure and is not a part of the body thereof subject to
consideration by the Legislative Assembly. It is an editor's
brief statement of the essential features of the measure as
introduced.
 
  Requires insurer offering health benefit plan to disclose, upon
request of enrollee, anticipated cost to enrollee of prescribed
procedure or service.
  Requires Director of Department of Consumer and Business
Services to adopt rules specifying standards for disclosure of
enrollee's share of cost for prescribed procedure or service
under health benefit plan, and to establish standard method of
determining usual, customary and reasonable payment to
noncontracted providers.
 
                        A BILL FOR AN ACT
Relating to payments for procedures covered by health benefit
  plan; creating new provisions; and amending ORS 743.801 and
  743.804.
Be It Enacted by the People of the State of Oregon:
  SECTION 1. ORS 743.804 is amended to read:
  743.804. All insurers offering a health benefit plan in this
state shall:
  (1) Have a written policy that recognizes the rights of
enrollees:
  (a) To voice grievances about the organization or health care
provided;
  (b) To be provided with information about the organization, its
services and the providers providing care;
  (c) To participate in decision making regarding their health
care; and
  (d) To be treated with respect and recognition of their dignity
and need for privacy.
  (2) Provide a summary of policies on enrollees' rights and
responsibilities to all participating providers upon request and
to all enrollees either directly or, in the case of group
coverage, to the employer or other policyholder for distribution
to enrollees.
  (3) Have a timely and organized system for resolving grievances
and appeals. The system shall include:
  (a) A systematic method for recording all grievances and
appeals, including the nature of the grievances, and significant
actions taken;
 
  (b) Written procedures explaining the grievance and appeal
process, including a procedure to assist enrollees in filing
written grievances;
  (c) Written decisions in plain language justifying grievance
determinations, including appropriate references to relevant
policies, procedures and contract terms;
  (d) Standards for timeliness in responding to grievances or
appeals that accommodate the clinical urgency of the situation;
  (e) Notice in all written decisions prepared pursuant to this
subsection that the enrollee may file a complaint with the
Director of the Department of Consumer and Business Services; and
  (f) An appeal process for grievances that includes at least the
following:
  (A) Three levels of review, the second of which shall be by
persons not previously involved in the dispute and the third of
which shall provide external review pursuant to an external
review program meeting the requirements of ORS 743.857, 743.859
and 743.861;
  (B) Opportunity for enrollees and any representatives of the
enrollees to appear before a review panel at either the first or
second level of review. Representatives may include health care
providers or any other persons chosen by the enrollee. The
enrollee and insurer shall each provide advance notification of
the number of representatives who will appear before the panel
and the relationship of the representatives to the enrollee or
insurer; and
  (C) Written decisions in plain language justifying appeal
determinations, including specific references to relevant
provisions of the health benefit plan and related written
corporate practices.
  (4) If the insurer has a prescription drug formulary, have:
  (a) A written procedure by which a provider with authority to
prescribe drugs and medications may prescribe drugs and
medications not included in the formulary. The procedure shall
include the circumstances when a drug or medication not included
in the formulary will be considered a covered benefit; and
  (b) A written procedure to provide full disclosure to enrollees
of any cost sharing or other requirements to obtain drugs and
medications not included in the formulary.
  (5) Furnish to all enrollees either directly or, in the case of
a group policy, to the employer or other policyholder for
distribution to enrollees written general information informing
enrollees about services provided, access to services, charges
and scheduling applicable to each enrollee's coverage, including:
  (a) Benefits and services included and how to obtain them,
including any restrictions that apply to services obtained
outside the insurer's network or outside the insurer's service
area, and the availability of continuity of care as required by
ORS 743.854;
  (b) Provisions for referrals, if any, for specialty care,
behavioral health services and hospital services and how
enrollees may obtain the care or services;
  (c) Provisions for after-hours and emergency care and how
enrollees may obtain that care, including the insurer's policy,
if any, on when enrollees should directly access emergency care
and use 9-1-1 services;
  (d) Charges to enrollees, if applicable, including any policy
on cost sharing for which the enrollee is responsible;
  (e) Procedures for notifying enrollees of:
  (A) A change in or termination of any benefit;
  (B) If applicable, termination of a primary care delivery
office or site; and
  (C) If applicable, assistance available to enrollees affected
by the termination of a primary care delivery office or site in
selecting a new primary care delivery office or site;
 
  (f) Procedures for appealing decisions adversely affecting the
enrollee's benefits or enrollment status;
  (g) Procedures, if any, for changing providers;
  (h) Procedures for voicing grievances, including the option of
obtaining external review under the insurer's program established
pursuant to ORS 743.857, 743.859 and 743.861;
  (i) A description of the procedures, if any, by which enrollees
and their representatives may participate in the development of
the insurer's corporate policies and practices;
  (j) Summary information on how the insurer makes decisions
regarding coverage and payment for treatment or services,
including a general description of any prior authorization and
utilization review requirements that affect coverage or payment;
  (k) A summary of criteria used to determine if a service or
drug is considered experimental or investigational;
  (L) Information about provider, clinic and hospital networks,
if any, including a list of network providers and information
about how the enrollee may obtain current information about the
availability of individual providers, the hours the providers are
available and a description of any limitations on the ability of
enrollees to select primary and specialty care providers;
  (m) A general disclosure of any risk-sharing arrangements the
insurer has with physicians and other providers;
  (n) A summary of the insurer's procedures for protecting the
confidentiality of medical records and other enrollee
information;
  (o) A description of any assistance provided to
non-English-speaking enrollees;
  (p) A summary of the insurer's policies, if any, on drug
prescriptions, including any drug formularies, cost sharing
differentials or other restrictions that affect coverage of drug
prescriptions;
  (q) Notice of the enrollee's right to file a complaint or seek
other assistance from the Director of the Department of Consumer
and Business Services; and
  (r) Notice of the information that is available upon request
pursuant to subsection (6) of this section and information that
is available from the Department of Consumer and Business
Services pursuant to ORS 743.804, 743.807, 743.814 and 743.817.
  (6) Provide the following information upon the request of an
enrollee or prospective enrollee:
  (a) Rules related to the insurer's drug formulary, if any,
including information on whether a particular drug is included or
excluded from the formulary;
  (b) Provisions for referrals, if any, for specialty care,
behavioral health services and hospital services and how
enrollees may obtain the care or services;
  (c) A copy of the insurer's annual report on grievances and
appeals as submitted to the department under subsection (9) of
this section;
  (d) A description of the insurer's risk-sharing arrangements
with physicians and other providers consistent with risk-sharing
information required by the federal Health Care Financing
Administration pursuant to 42 C.F.R. 417.124 (3)(b) as in effect
on June 18, 1997;
  (e) A description of the insurer's efforts, if any, to monitor
and improve the quality of health services;
  (f) Information about any insurer procedures for credentialing
network providers and how to obtain the names, qualifications and
titles of the providers responsible for an enrollee's care; and
  (g) A description of the insurer's external review program
established pursuant to ORS 743.857, 743.859 and 743.861.
  (7) Except as otherwise provided in this subsection, provide to
enrollees, upon request, a written summary of information that
the insurer may consider in its utilization review of a
particular condition or disease to the extent the insurer
maintains such criteria. Nothing in this section shall require an
insurer to advise an enrollee how the insurer would cover or
treat that particular enrollee's disease or condition.
Utilization review criteria that is proprietary shall be subject
to verbal disclosure only.
  (8) Provide the following information to an enrollee when the
enrollee has filed a grievance:
  (a) Detailed information on the insurer's grievance and appeal
procedures and how to use them;
  (b) Information on how to access the complaint line of the
Department of Consumer and Business Services; and
  (c) Information explaining how an enrollee applies for external
review of the insurer's actions under the external review program
established by the insurer pursuant to ORS 743.857.
  (9) Provide annual summaries to the Department of Consumer and
Business Services of the insurer's aggregate data regarding
grievances, appeals and applications for external review in a
format prescribed by the department to ensure consistent
reporting on the number, nature and disposition of grievances,
appeals and applications for external review.
  (10) Ensure that the confidentiality of specified patient
information and records is protected, and to that end:
  (a) Adopt and implement written confidentiality policies and
procedures;
  (b) State the insurer's expectations about the confidentiality
of enrollee information and records in medical service contracts;
and
  (c) Afford enrollees the opportunity to approve or deny the
release of identifiable medical personal information by the
insurer, except as otherwise permitted or required by law.
  (11) Notify an enrollee of the enrollee's rights under the
health benefit plan at the time that the insurer notifies the
enrollee of an adverse decision. The notification shall include:
  (a) Notice of the right of the enrollee to apply for internal
and external review of the adverse decision;
  (b) A statement whether a decision by an independent review
organization is binding on the insurer and enrollee;
  (c) A statement that if the decision is not binding on the
insurer and if the insurer does not comply with the decision, the
enrollee may sue the insurer as provided in ORS 743.864; and
  (d) Information on filing a complaint with the Director of the
Department of Consumer and Business Services.
   { +  (12)(a) Establish a procedure for disclosing to an
enrollee, with respect to specified procedures or services
prescribed for the enrollee and covered by the plan, the cost of
the procedure or service for which the enrollee will be
responsible through deductibles, coinsurance or another cost
sharing method used by the insurer. The insurer must disclose,
upon the enrollee's request and in advance of the procedure or
service, the actual cost to be borne by the enrollee, if
available, or a reasonable estimate of the cost.
  (b) The director by rule shall specify the procedures and
services to which this subsection applies and standards for the
disclosure required under this subsection. + }
  SECTION 2. { +  Section 3 of this 2007 Act is added to and made
a part of ORS chapter 743. + }
  SECTION 3. { +  (1) The Director of the Department of Consumer
and Business Services by rule shall establish a standard method
to be used by insurers to determine the usual, customary and
reasonable amounts to be reimbursed for procedures and services
covered under a health benefit plan when the insurer does not
have a pricing agreement with a provider for procedures or
services performed by the provider for an enrollee.
  (2) An insurer of a health benefit plan shall use the standard
method established under subsection (1) of this section to
calculate the amount of reimbursement to be paid by the insurer
for a covered procedure or service provided by a provider with
whom the insurer does not have a pricing agreement for services
covered under the plan. + }
  SECTION 4. ORS 743.801 is amended to read:
  743.801. As used in ORS 743.699, 743.801, 743.803, 743.804,
743.806, 743.807, 743.808, 743.811, 743.814, 743.817, 743.819,
743.821, 743.823, 743.827, 743.829, 743.831, 743.834, 743.837,
743.839, 743.854, 743.856, 743.857, 743.858, 743.859, 743.861,
743.862, 743.863, 743.864, 743.866 and 743.868 { +  and section 3
of this 2007 Act + }:
  (1) 'Emergency medical condition' means a medical condition
that manifests itself by acute symptoms of sufficient severity,
including severe pain, that a prudent layperson possessing an
average knowledge of health and medicine would reasonably expect
that failure to receive immediate medical attention would place
the health of a person, or a fetus in the case of a pregnant
woman, in serious jeopardy.
  (2) 'Emergency medical screening exam' means the medical
history, examination, ancillary tests and medical determinations
required to ascertain the nature and extent of an emergency
medical condition.
  (3) 'Emergency services' means those health care items and
services furnished in an emergency department and all ancillary
services routinely available to an emergency department to the
extent they are required for the stabilization of a patient.
  (4) 'Enrollee' has the meaning given that term in ORS 743.730.
  (5) 'Grievance' means a written complaint submitted by or on
behalf of an enrollee regarding the:
  (a) Availability, delivery or quality of health care services,
including a complaint regarding an adverse determination made
pursuant to utilization review;
  (b) Claims payment, handling or reimbursement for health care
services; or
  (c) Matters pertaining to the contractual relationship between
an enrollee and an insurer.
  (6) 'Health benefit plan' has the meaning provided for that
term in ORS 743.730.
  (7) 'Independent practice association' means a corporation
wholly owned by providers, or whose membership consists entirely
of providers, formed for the sole purpose of contracting with
insurers for the provision of health care services to enrollees,
or with employers for the provision of health care services to
employees, or with a group, as described in ORS 743.522, to
provide health care services to group members.
  (8) 'Insurer' has the meaning provided for that term in ORS
731.106. For purposes of ORS 743.699, 743.801, 743.803, 743.804,
743.806, 743.807, 743.808, 743.811, 743.814, 743.817, 743.819,
743.821, 743.823, 743.827, 743.829, 743.831, 743.834, 743.837,
743.839, 743.854, 743.856, 743.857, 743.858, 743.859, 743.861,
743.862, 743.863, 743.864, 743.866, 743.868, 750.055 and 750.333
 { +  and section 3 of this 2007 Act + }, 'insurer' also includes
a health care service contractor as defined in ORS 750.005.
  (9) 'Managed health insurance' means any health benefit plan
that:
  (a) Requires an enrollee to use a specified network or networks
of providers managed, owned, under contract with or employed by
the insurer in order to receive benefits under the plan, except
for emergency or other specified limited service; or
  (b) In addition to the requirements of paragraph (a) of this
subsection, offers a point-of-service provision that allows an
enrollee to use providers outside of the specified network or
networks at the option of the enrollee and receive a reduced
level of benefits.
  (10) 'Medical services contract' means a contract between an
insurer and an independent practice association, between an
insurer and a provider, between an independent practice
association and a provider or organization of providers, between
medical or mental health clinics, and between a medical or mental
health clinic and a provider to provide medical or mental health
services. 'Medical services contract' does not include a contract
of employment or a contract creating legal entities and ownership
thereof that are authorized under ORS chapter 58, 60 or 70, or
other similar professional organizations permitted by statute.
  (11)(a) 'Preferred provider organization insurance' means any
health benefit plan that:
  (A) Specifies a preferred network of providers managed, owned
or under contract with or employed by an insurer;
  (B) Does not require an enrollee to use the preferred network
of providers in order to receive benefits under the plan; and
  (C) Creates financial incentives for an enrollee to use the
preferred network of providers by providing an increased level of
benefits.
  (b) 'Preferred provider organization insurance' does not mean a
health benefit plan that has as its sole financial incentive a
hold harmless provision under which providers in the preferred
network agree to accept as payment in full the maximum allowable
amounts that are specified in the medical services contracts.
  (12) 'Prior authorization' means a determination by an insurer
prior to provision of services that the insurer will provide
reimbursement for the services. 'Prior authorization ' does not
include referral approval for evaluation and management services
between providers.
  (13) 'Provider' means a person licensed, certified or otherwise
authorized or permitted by laws of this state to administer
medical or mental health services in the ordinary course of
business or practice of a profession.
  (14) 'Stabilization' means that, within reasonable medical
probability, no material deterioration of an emergency medical
condition is likely to occur.
  (15) 'Utilization review' means a set of formal techniques used
by an insurer or delegated by the insurer designed to monitor the
use of or evaluate the medical necessity, appropriateness,
efficacy or efficiency of health care services, procedures or
settings.
  SECTION 5.  { + Section 3 of this 2007 Act and the amendments
to ORS 743.801 and 743.804 by sections 1 and 4 of this 2007 Act
apply to health insurance policies or certificates issued or
renewed on or after the effective date of this 2007 Act. + }
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