LRB-2313/3
PJK:wlj:mrc
1999 - 2000 LEGISLATURE
October 5, 1999 - Introduced by Representatives Underheim, F. Lasee, Musser,
Kelso, Urban, Ladwig, Albers, Kaufert and Kedzie, cosponsored by Senators
Breske, Rosenzweig, Roessler, Darling, Schultz and Drzewiecki. Referred
to Committee on Insurance.
AB518,1,9
1An Act to renumber 609.15 (1) (c), 609.15 (2) (c), 609.15 (2) (d) and 609.15 (2)
2(e);
to renumber and amend 609.15 (1) (intro.), 609.15 (1) (a), 609.15 (1) (b),
3609.15 (2) (intro.), 609.15 (2) (a) and 609.15 (2) (b);
to amend 40.51 (8), 40.51
4(8m), 600.01 (2) (b) and 601.42 (4); and
to create 111.91 (2) (r), 601.31 (1) (Lp),
5601.31 (1) (Lr), 632.83 and 632.835 of the statutes;
relating to: requiring all
6insurers to establish internal grievance procedures, independent review of
7certain coverage determinations made by health benefit plans, granting
8rule-making authority and providing an exemption from emergency rule
9procedures.
Analysis by the Legislative Reference Bureau
Under current law, every managed care plan is required to have an internal
grievance procedure under which an enrollee may submit a written grievance and
a grievance panel must investigate the grievance and, if appropriate, take corrective
action. This bill requires every health benefit plan to have such an internal
grievance procedure. In addition, the bill requires every health benefit plan,
including managed care plans and plans covering state and municipal employes, to
have an independent review procedure for review of certain decisions under the
health benefit plan's internal grievance procedure that are adverse to insureds. The
decision must relate to the plan's denial of treatment or payment for treatment that
the plan determined was experimental or to the plan's denial, reduction or
termination of a health care service or payment for a health care service, including
admission to or continued stay in a health care facility, on the basis that the health
care service did not meet the plan's requirements for medical necessity or
appropriateness, health care setting or level of care or effectiveness. In order to be
eligible for independent review, the amount of the reduction or the value of the denied
or terminated service must be at least $500, which may be increased or decreased by
the commissioner of insurance (commissioner) based on changes in the consumer
price index. Generally, an insured must request independent review within four
months after receiving notice of the adverse decision on his or her grievance under
the internal grievance procedure.
Under the bill, an independent review may be conducted only by an
independent review organization that has been certified by the commissioner. A
certified independent review organization must be recertified every two years to
continue to conduct independent reviews. The commissioner may revoke, suspend
or limit the certification of an independent review organization for various reasons
specified in the bill. Clinical peer reviewers, who conduct the reviews on behalf of
independent review organizations, must be health care providers who satisfy
specified criteria, including having expertise through actual clinical experience in
treating the condition that is the subject of the review. Every insurer that issues a
health benefit plan must contract with one or more certified independent review
organizations for the purpose of conducting the independent reviews in which the
plan is involved. A contract must be at least two years long, and an insurer must
inform the commissioner if such a contract is not renewed and of the reasons for the
nonrenewal.
To request an independent review, an insured must provide written notice of the
request to the health benefit plan, which must inform the commissioner of the
request and inform the insured of the name and address of the independent review
organization that will be conducting the independent review. The insured must pay
$50 to the independent review organization, which is refunded to the insured if he
or she prevails, in whole or in part, in the independent review. In addition, the plan
must pay a fee to the independent review organization for each review.
Within three days after receiving the notice from the insured, the health benefit
plan must send to the independent review organization all of the information that
it used in making the determination in the internal grievance procedure. No later
than five days after receiving that information, the independent review organization
may request more information from either or both parties, who have five more days
in which to supply the requested information. The independent review organization
may consider, however, any other relevant information, and any information that a
party provides to the independent review organization must also be provided to the
other party. Within 30 days after the expiration of all relevant time limits in the
matter, the independent review organization must make a determination on the
basis of the written information submitted by the parties. If an expedited review is
required because of the enrollee's medical condition, all specified time limits are
shortened, and the independent review organization must make a determination
within 72 hours after the expiration of all relevant time limits in the matter. The bill
specifies certain review standards for independent review organizations, including
under what circumstances treatment that was considered experimental by the
health benefit plan must be covered. The decision at the conclusion of an
independent review, which is binding on the insured and the health benefit plan,
must be in writing and served on both parties.
The bill contains prohibitions aimed at avoiding conflicts of interest for
independent review organizations, such as prohibiting an independent review
organization from owning, controlling or being a subsidiary of a health benefit plan
or an association of health benefit plans. The bill also provides independent review
organizations and clinical peer reviewers with immunity from liability for decisions
made in independent reviews.
The bill requires the commissioner to promulgate rules relating to such topics
as the application procedures and standards for certification and recertification of
independent review organizations, additional procedures and processes that
independent review organizations must use in independent reviews, standards for
the practices and conduct of independent review organizations and additional
standards related to conflicts of interest.
Finally, the bill requires the commissioner to determine when a sufficient
number of independent review organizations have been certified to effectively
provide the independent reviews required under the bill. When the commissioner
makes that determination, the commissioner must publish a notice in the Wisconsin
Administrative Register that specifies a date that is six months after the
determination is made. That date is the date on which the independent review
procedure must begin operating.
For further information see the state and local fiscal estimate, which will be
printed as an appendix to this bill.
The people of the state of Wisconsin, represented in senate and assembly, do
enact as follows:
AB518, s. 1
1Section
1. 40.51 (8) of the statutes is amended to read:
AB518,3,52
40.51
(8) Every health care coverage plan offered by the state under sub. (6)
3shall comply with ss. 631.89, 631.90, 631.93 (2), 632.72 (2), 632.746 (1) to (8) and (10),
4632.747, 632.748,
632.83, 632.835, 632.85, 632.853, 632.855, 632.87 (3) to (5),
5632.895 (5m) and (8) to (13) and 632.896.
AB518, s. 2
6Section
2. 40.51 (8m) of the statutes is amended to read:
AB518,4,3
140.51
(8m) Every health care coverage plan offered by the group insurance
2board under sub. (7) shall comply with ss. 632.746 (1) to (8) and (10), 632.747,
3632.748,
632.83, 632.835, 632.85, 632.853, 632.855 and 632.895 (11) to (13).
AB518, s. 3
4Section
3. 111.91 (2) (r) of the statutes is created to read:
AB518,4,75
111.91
(2) (r) The requirements related to internal grievance procedures under
6s. 632.83 and independent review of certain health benefit plan determinations
7under s. 632.835.
AB518, s. 4
8Section
4. 600.01 (2) (b) of the statutes is amended to read:
AB518,4,109
600.01
(2) (b) Group or blanket insurance described in sub. (1) (b) 3. and 4. is
10not exempt from ss. 632.745 to 632.749
, 632.83 or 632.835 or ch. 633 or 635.
AB518, s. 5
11Section
5. 601.31 (1) (Lp) of the statutes is created to read:
AB518,4,1312
601.31
(1) (Lp) For certifying as an independent review organization under s.
13632.835, $400.
AB518, s. 6
14Section
6. 601.31 (1) (Lr) of the statutes is created to read:
AB518,4,1615
601.31
(1) (Lr) For each biennial recertification as an independent review
16organization under s. 632.835, $100.
AB518, s. 7
17Section
7. 601.42 (4) of the statutes is amended to read:
AB518,5,318
601.42
(4) Replies. Any officer, manager or general agent of any insurer
19authorized to do or doing an insurance business in this state, any person controlling
20or having a contract under which the person has a right to control such an insurer,
21whether exclusively or otherwise, any person with executive authority over or in
22charge of any segment of such an insurer's affairs, any individual practice
23association or officer, director or manager of an individual practice association, any
24insurance agent or other person licensed under chs. 600 to 646, any provider of
25services under a continuing care contract, as defined in s. 647.01 (2),
any
1independent review organization certified under s. 632.835 (4) or any health care
2provider, as defined in s. 655.001 (8), shall reply promptly in writing or in other
3designated form, to any written inquiry from the commissioner requesting a reply.
AB518, s. 8
4Section
8. 609.15 (1) (intro.) of the statutes is renumbered 609.15 and
5amended to read:
AB518,5,8
6609.15 Grievance procedure. Each limited service health organization,
7preferred provider plan and managed care plan shall
do all of the following: establish
8and use an internal grievance procedure as provided in s. 632.83.
AB518, s. 9
9Section
9. 609.15 (1) (a) of the statutes is renumbered 632.83 (2) (a) and
10amended to read:
AB518,5,1411
632.83
(2) (a) Establish and use an internal grievance procedure that is
12approved by the commissioner and that complies with sub.
(2) (3) for the resolution
13of
enrollees' insureds' grievances with the
limited service health organization,
14preferred provider plan or managed care health benefit plan.
AB518, s. 10
15Section
10. 609.15 (1) (b) of the statutes is renumbered 632.83 (2) (b) and
16amended to read:
AB518,5,1817
632.83
(2) (b) Provide
enrollees
insureds with complete and understandable
18information describing the internal grievance procedure under par. (a).
AB518, s. 11
19Section
11. 609.15 (1) (c) of the statutes is renumbered 632.83 (2) (c).
AB518, s. 12
20Section
12. 609.15 (2) (intro.) of the statutes is renumbered 632.83 (3) (intro.)
21and amended to read:
AB518,5,2322
632.83
(3) (intro.) The internal grievance procedure established under sub.
(1) 23(2) (a) shall include all of the following elements:
AB518, s. 13
24Section
13. 609.15 (2) (a) of the statutes is renumbered 632.83 (3) (a) and
25amended to read:
AB518,6,2
1632.83
(3) (a) The opportunity for an
enrollee insured to submit a written
2grievance in any form.
AB518, s. 14
3Section
14. 609.15 (2) (b) of the statutes is renumbered 632.83 (3) (b) and
4amended to read:
AB518,6,85
632.83
(3) (b) Establishment of a grievance panel for the investigation of each
6grievance submitted under par. (a), consisting of at least one individual authorized
7to take corrective action on the grievance and at least one
enrollee insured other than
8the grievant, if an
enrollee insured is available to serve on the grievance panel.
AB518, s. 15
9Section
15. 609.15 (2) (c) of the statutes is renumbered 632.83 (3) (c).
AB518, s. 16
10Section
16. 609.15 (2) (d) of the statutes is renumbered 632.83 (3) (d).
AB518, s. 17
11Section
17. 609.15 (2) (e) of the statutes is renumbered 632.83 (3) (e).
AB518, s. 18
12Section
18. 632.83 of the statutes is created to read:
AB518,6,15
13632.83 Internal grievance procedure.
(1) In this section, "health benefit
14plan" has the meaning given in s. 632.745 (11), except that "health benefit plan"
15includes the coverage specified in s. 632.745 (11) (b) 10.
AB518,6,16
16(2) Each health benefit plan shall do all of the following:
AB518, s. 19
17Section
19. 632.835 of the statutes is created to read:
AB518,6,19
18632.835 Independent review of adverse and experimental treatment
19determinations. (1) Definitions. In this section:
AB518,6,2120
(a) "Adverse determination" means a determination by or on behalf of a health
21benefit plan to which all of the following apply: