AB652: Bill Text

LRB-0446/1

PJK:jlg:km

1997 - 1998 LEGISLATURE

1997 Assembly BILL 652

December 11, 1997 - Introduced by Representatives Urban, Ladwig, Johnsrud, Wasserman, Bock, Lorge, Vrakas, Robson, Lazich, Brandemuehl, Owens, Musser, Hasenohrl, Gunderson, Baumgart, Porter, Powers, Sykora, J. Lehman, Goetsch and Baldwin, cosponsored by Senators Welch, Rosenzweig, C. Potter, Roessler, Wirch, Darling and A. Lasee. Referred to Committee on Health.

AB652,1,8 An Act to amend 40.51 (8c), 40.51 (8c), 40.51 (8r), 40.51 (8r), 185.981 (4t), 185.981 (4t), 185.981 (4t), 185.983 (1) (intro.), 185.983 (1) (intro.), 185.983 (1) (intro.), 609.15 (1) (a), 609.20 (2) and 609.20 (4); and to create 40.51 (8c), 40.51 (8r), 628.42, 632.85, 632.855 and 632.865 of the statutes; relating to: point-of-service coverage options, requirements for and certification of health care plans and utilization review programs, prohibiting certain employment terminations, prohibiting requiring prior authorization for emergency services and granting rule-making authority.

Analysis by the Legislative Reference Bureau

Health care plan requirements

This bill establishes certain requirements for health care plans, which are defined as insurance contracts providing coverage of health care expenses. Under the bill, a health care plan must provide written information to prospective enrollees about the terms and conditions under the plan. Included must be such information as coverage provisions; premiums, deductibles and coinsurance requirements; any required prior authorization; any financial incentives for providers to limit health care services; enrollee satisfaction statistics; loss ratios; and a description of the plan's grievance and appeal procedures. In addition to providing the written information, a health care plan must:

1. Establish standards for enrollee access to specified types of providers and health care services.

2. Provide coverage for all drugs and devices that are approved by the federal food and drug administration and allow an enrollee's attending physician to determine the appropriate drug for the enrollee's needs.

3. Develop a written policy on continuity of care and provide at least 30 days' notice to an enrollee if a provider who has been treating the enrollee terminates participation with the health care plan.

4. Establish a physician advisory committee for various specified purposes, including providing advice on the plan's medical policies and conducting peer review activities.

5. Establish procedures for fairly and systematically soliciting and acting on physician applications for participation in the plan and make the criteria for physician selection for participation in the plan available to physician applicants and the public.

6. Provide a physician with a written statement of reasons and an opportunity for a hearing prior to any restriction or termination of the physician's participation in the plan.

Under the bill, a health care plan must limit physician participation in the plan to 2-year periods. A participating physician must submit an application to continue participation in the plan and the plan must use the same criteria for continued participation that it used for initial participation.

A health care plan may not prohibit or restrict a participating provider from disclosing to an enrollee any health care information that the provider determines is medically appropriate regarding the nature of, alternatives to or risks associated with treatment being provided to the enrollee. The bill prohibits a health care plan from offering payment to a physician as an inducement to reduce or limit medically appropriate services.

The bill requires a health care plan to respond to a request for nonemergency services within 2 business days after the request is received. Emergency care must be provided without prior authorization.

The bill requires a health care plan to establish a utilization review program. Under the utilization review program, a health care plan must appoint a physician as its medical director, to be responsible for all clinical decisions made under the plan. The health care plan must contract with a reviewer to make recommendations on coverage or payment for services and on medical appropriateness of services. If services or coverage for services is denied on the basis that the treatment is or was not medically appropriate, the health care plan must provide the enrollee and provider with a statement of reasons for the denial and with instructions for appealing the decision. The plan must provide for review of the denial, first by the medical director, next by the physician advisory committee and finally by a physician who is not participating in the plan and who is determined by the plan's physician advisory committee to be qualified to evaluate the treatment that was the subject of the denial.

Under the bill, a health care plan may apply to the commissioner of insurance for certification that the health care plan is in compliance with the requirements established in the bill. The commissioner must appoint a task force made up of equal numbers of physicians, other providers, benefit managers, consumers of health care services and representatives of insurers to advise the commissioner on developing standards for the certification of health care plans.

Point-of-service coverage option

The bill requires any health care plan that controls utilization of health care services or that requires its enrollees to obtain health care services from providers who are members of the plan's provider network to offer all of its enrollees a coverage option under which an enrollee has access to and coverage of health care services that are provided by one or more providers who are not part of the plan's provider network. A health care plan must offer this point-of-service coverage option for a one-month period at least annually and may charge an additional premium for the coverage option.

Retaliatory employment termination and emergency services

The bill prohibits a health care plan from terminating an employment or contractual relationship with, or otherwise penalizing, a physician or other provider on the basis that the provider appealed a payer's decision to deny payment for a service or protested a decision, policy or practice that the provider reasonably believed impaired his or her ability to provide medically appropriate health care. The bill prohibits a health care plan from requiring prior authorization for the provision or coverage of health care services or items that are provided in a hospital emergency facility for the treatment of an emergency medical condition. An emergency medical condition is defined as a medical condition that has a recent onset and symptoms of such severity that a prudent layperson could reasonably conclude that lack of immediate medical attention will likely result in serious consequences to the person's health, bodily functions or body parts.

For further information see the state 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:

AB652, s. 1 Section 1 . 40.51 (8c) of the statutes is created to read:

AB652,3,4 40.51 (8c) Every health care coverage plan, except for an uninsured health care coverage plan, offered by the state under sub. (6) shall comply with ss. 632.855 and 632.865.

AB652, s. 2 Section 2 . 40.51 (8c) of the statutes, as created by 1997 Wisconsin Act .... (this act), section 1, is amended to read:

AB652,4,3 40.51 (8c) Every health care coverage plan, except for an uninsured health care coverage plan, offered by the state under sub. (6) shall comply with ss. 632.85, 632.855 and 632.865.

AB652, s. 3 Section 3 . 40.51 (8c) of the statutes, as affected by 1997 Wisconsin Act .... (this act), sections 1 and 2, is amended to read:

AB652,4,8 40.51 (8c) Every health care coverage plan, except for an uninsured health care coverage plan, offered by the state under sub. (6) shall comply with ss. 628.42 (1) to (3), 632.85, 632.855 and 632.865.

AB652, s. 4 Section 4 . 40.51 (8r) of the statutes is created to read:

AB652,4,12 40.51 (8r) Every health care coverage plan, except for an uninsured health care coverage plan, offered by the group insurance board under sub. (7) shall comply with ss. 632.855 and 632.865.

AB652, s. 5 Section 5 . 40.51 (8r) of the statutes, as created by 1997 Wisconsin Act ... (this act), section 4, is amended to read:

AB652,4,17 40.51 (8r) Every health care coverage plan, except for an uninsured health care coverage plan, offered by the group insurance board under sub. (7) shall comply with ss. 632.85, 632.855 and 632.865.

AB652, s. 6 Section 6 . 40.51 (8r) of the statutes, as affected by 1997 Wisconsin Act ... (this act), sections 4 and 5, is amended to read:

AB652,4,22 40.51 (8r) Every health care coverage plan, except for an uninsured health care coverage plan, offered by the group insurance board under sub. (7) shall comply with ss. 628.42 (1) to (3), 632.85, 632.855 and 632.865.

AB652, s. 7 Section 7 . 185.981 (4t) of the statutes, as affected by 1997 Wisconsin Act 27, section 3133m, is amended to read:

AB652,5,3 185.981 (4t) A sickness care plan operated by a cooperative association is subject to ss. 252.14, 631.89, 632.72 (2), 632.745 to 632.749, 632.855, 632.865, 632.87 (2m), (3), (4) and (5), 632.895 (10) to (13) and 632.897 (10) and chs. 149 and 155.

AB652, s. 8 Section 8 . 185.981 (4t) of the statutes, as affected by 1997 Wisconsin Act 27, section 3133m, and 1997 Wisconsin Act .... (this act), section 7, is amended to read:

AB652,5,9 185.981 (4t) A sickness care plan operated by a cooperative association is subject to ss. 252.14, 631.89, 632.72 (2), 632.745 to 632.749, 632.85, 632.855, 632.865, 632.87 (2m), (3), (4) and (5), 632.895 (10) to (13) and 632.897 (10) and chs. 149 and 155.

AB652, s. 9 Section 9 . 185.981 (4t) of the statutes, as affected by 1997 Wisconsin Act 27, section 3133m, and 1997 Wisconsin Act .... (this act), sections 7 and 8 , is amended to read:

AB652,5,16 185.981 (4t) A sickness care plan operated by a cooperative association is subject to ss. 252.14, 628.42 (1) to (3), 631.89, 632.72 (2), 632.745 to 632.749, 632.85, 632.855, 632.865, 632.87 (2m), (3), (4) and (5), 632.895 (10) to (13) and 632.897 (10) and chs. 149 and 155.

AB652, s. 10 Section 10 . 185.983 (1) (intro.) of the statutes, as affected by 1997 Wisconsin Act 27, section 3134m, is amended to read:

AB652,5,24 185.983 (1) (intro.)  Every such voluntary nonprofit sickness care plan shall be exempt from chs. 600 to 646, with the exception of ss. 601.04, 601.13, 601.31, 601.41, 601.42, 601.43, 601.44, 601.45, 611.67, 619.04, 628.34 (10), 631.89, 631.93, 632.72 (2), 632.745 to 632.749, 632.775, 632.79, 632.795, 632.855, 632.865, 632.87 (2m), (3), (4) and (5), 632.895 (5) and (9) to (13), 632.896 and 632.897 (10) and chs. 609, 630, 635, 645 and 646, but the sponsoring association shall:

AB652, s. 11 Section 11 . 185.983 (1) (intro.) of the statutes, as affected by 1997 Wisconsin Act 27, section 3134m, and 1997 Wisconsin Act .... (this act), section 10, is amended to read:

AB652,6,9 185.983 (1) (intro.) Every such voluntary nonprofit sickness care plan shall be exempt from chs. 600 to 646, with the exception of ss. 601.04, 601.13, 601.31, 601.41, 601.42, 601.43, 601.44, 601.45, 611.67, 619.04, 628.34 (10), 631.89, 631.93, 632.72 (2), 632.745 to 632.749, 632.775, 632.79, 632.795, 632.85, 632.855, 632.865, 632.87 (2m), (3), (4) and (5), 632.895 (5) and (9) to (13), 632.896 and 632.897 (10) and chs. 609, 630, 635, 645 and 646, but the sponsoring association shall:

AB652, s. 12 Section 12 . 185.983 (1) (intro.) of the statutes, as affected by 1997 Wisconsin Act 27, section 3134m, and 1997 Wisconsin Act ... (this act), sections 10 and 11 , is amended to read: