STATE LEGISLATIVE UPDATE

APRIL 2002 STATE LEGISLATIVE UPDATE

The latest budget figures show no sign of relief for the states. It is estimated that the aggregate budget deficit has climbed to $27 billion. At least forty states over the last nine months have cut spending while only two have raised income or sales taxes. The public continues to clamor for contradictory policy aims: do not raise my taxes, but do not cut spending on my pet project.

As of the end of the month, the following state legislatures were in regular session: AK, AZ, CA, CO, CT, DE, HI, IL, KS, LA, MA, MI, MN, MO, NH, NJ, NY, OH, OK, PA, RI, SC, TN, VT, and

was in special session. During April sessions adjourned in AL, FL, KY, MD, ME, MS, and NE. Through April there have been 79,135 new bills introduced in the states (this does not include carry-over bills from last year) and 15,519 have become law.

Some of the bills the Department of Health Policy is tracking are outlined below. If you have any questions please give Jay Fisher a call at 800-346-2267, x4336.

PATIENT SAFETY

Legislation was signed into law in Maine creating the Maine Health Care Quality Improvement Center. The Center is to provide assistance to health care facilities, conduct research and create education materials. A health care facility is mandated to report sentinel events to the Center orally within one day and by written report within 45 days. The Center must investigate the sentinel event and make a report to the facility and the public while protecting patient confidentiality. All reports and information gathered by the Center are privileged and confidential. A physician profile bill passed the House in Vermont.

OSTEOPOROSIS

Legislation to set up an osteoporosis prevention and education task force was signed into law in Maryland. The task force will include an orthopaedist. The task force is to make recommendations on how to address osteoporosis in the state. The women's health bill in New York that contains mandatory bone density screenings is still being negotiated.

SCOPE OF PRACTICE

Bills were signed into law in Tennessee to allow chiropractors to order lab tests and prohibit discrimination against podiatrists by HMOs. A bill passed both houses in Hawaii that allows chiropractors to call themselves chiropractic physicians and send specimens for lab tests. The bill also expands the scope of chiropractic practice from the spine to the entire human body. The body is defined as: the spinal column; the head including temporomandibular joint, but excluding atlanto-occipital; the lower and upper extremities; the rib cage, limited to the anterior region, but excluding the costotransverse and costovertebral joints; and the abdomen. Before the conference committee amended the bill it had defined the scope as the "human body."

REIMBURSEMENT

Bills were introduced in Michigan and Louisiana to allow physicians to take income tax deductions for certain unreimbursed care. Legislation was signed into law in Tennessee that requires health insurance carriers to provide a schedule of fees to health care providers prior to entering into or renewing a contract of service. The schedule must include a description of the payment process, considerations that affect the payment process and would require insurers to provide examples of payments and procedures for medical procedures frequently performed. The bill would require that any change in the fee schedule be made available to providers at least 30 days prior to the change being enacted.

Litigation also continues to be a popular item among physicians. The Tennessee Medical Association filed suit against the four largest insurers in the state alleging the use of bundling, downcoding and other mechanisms to refuse or reduce reimbursement to doctors. A similar lawsuit was filed in New Jersey by a pediatrician.

PROMPT PAYMENT

Prompt pay legislation was introduced in Florida during the special session that convened in April. Legislation passed both houses and was signed by the Governor in Colorado. The bill amends current law by requiring the state to delineate what elements must be filled out on a claim for it to be considered clean. Penalties for late payment can be paid by insurers quarterly or when the total reaches $10. Carriers must accept electronic claims.

A bill to continue the prompt pay law in Hawaii was signed by the Governor. The bill requires plans to offer a system whereby providers can check enrollee eligibility. Interest penalties under $2.00 do not have to be paid on late claims. The bill defines a clean claim to be a claim for a covered health care service--provided by an eligible health care provider to a covered person under the contract--that has no material defect or impropriety, involves no dispute regarding the amount claimed and the payer has no reason to believe that the claim was submitted fraudulently.

A bill was passed in March in Indiana that corrected a drafting error that inadvertently meant that HMOs could not pay claims in less than 30 days. That is definitely what I call a technical error. The prompt pay bills in Michigan passed the Senate in April and now go to Governor Engler who vetoed prompt pay legislation last year. The Governor of Mississippi signed into law prompt pay legislation that: reduces the time period for paying clean claims to 35 days for paper claims and 25 days for electronic claims, defines a clean claim and gives the state the ability to fine insurers who violate the law.

States continue to levy fine for prompt pay violations. Thirteen carriers in Texas agreed to $2.77 million in fines for prompt pay violations in addition to the $7 million in restitution paid to physicians. The largest fine was to Metropolitan Life Insurance Co. at $575,000. New York fined 22 carriers a total of $4 million in April for violating the prompt pay law. Oxford Health Plan alone was fined $918,000 and U.S. Healthcare was fined $751,650. Florida fined sixteen of the state's 32 HMOs for violating the prompt pay law. Blue Cross Blue Shield doesn't plan to appeal their $47,000 fine since it would be cheaper to pay the fine than to appeal.

A bill passed in New Hampshire to allow retroactive denial only within 18 months from the payment of the claim. The reason for the denial must be given to the physician in writing.