AB876: Bill Text

AB876,15,14 3. The amount of the total premium that is the premium amount established by rule under sub. (5) (a).

AB876,15,21 (4) Provider discounts. (a) The commissioner by rule shall establish provider discount rates for charges for covered services provided to insureds under group health benefit plans that are issued or renewed to small employers in this state on or between the dates specified by rule under sub. (5) (b). The commissioner may establish higher provider discount rates for covered benefits under group health benefit plans that are issued by small employer insurers that specify higher threshold levels under sub. (2) (a).

AB876,16,2 (b) Except for copayments, coinsurance, or deductibles required or authorized under a group health benefit plan, a provider of a covered service, drug, or device shall accept as payment in full for the covered service, drug, or device the discounted payment rate under par. (a) and may not bill the insured under the group health benefit plan who receives the service, drug, or device for any amount by which the charge is reduced under par. (a).

AB876,16,4 (5) Rules. The commissioner shall promulgate rules developed by the board for the operation of this section, including rules that do all of the following:

AB876,16,9 (a) Establish and periodically adjust the premium amounts that must be charged to small employers under sub. (3) (c) 3. The premium amounts under sub. (3) (c) 3. shall be based on an actuarily sound charge per covered individual that is calculated to generate sufficient moneys, in conjunction with provider discounts under sub. (4), to cover the reimbursements required under sub. (2) (c).

AB876,16,11 (b) Specify the dates that apply in sub. (3) (a), subject to the dates specified in par. (c) and sub. (2) (c).

AB876,16,14 (c) Specify the dates by which a small employer insurer must forward to the board the premiums established under par. (a). The first date by which the premiums must be forwarded to the board may not be later than July 1, 2003.

AB876,16,17 (d) Specify the procedures that small employer insurers must use for collecting, segregating, holding in trust, and forwarding to the board the premiums established under par. (a).

AB876,16,21 (e) Specify the procedures that small employer insurers must use for obtaining reimbursement under sub. (2) (c), including requirements for documenting the payment of covered benefits for determining whether a small employer insurer has paid its threshold level of covered benefits.

AB876, s. 21 Section 21. 635.30 of the statutes is created to read:

AB876,16,23 635.30 Pilot catastrophic care program. (1) In this section:

AB876,16,24 (a) "Board" means the small employer catastrophic care board.

AB876,17,2 (b) "Fiscal year" means the period beginning on July 1 and ending on the following June 30.

AB876,17,3 (c) "Fund" means the small employer catastrophic care program fund.

AB876,17,4 (d) "Health care coverage revenue" has the meaning given in s. 149.10 (3m).

AB876,17,5 (e) "Insurer" has the meaning given in s. 632.745 (15).

AB876,17,7 (f) "Program" means the pilot program established and administered under this section.

AB876,17,10 (g) "Provider" means a health care professional, as defined in s. 180.1901 (1m), a health care facility, as defined in s. 146.997 (1) (c), or a health care service or organization.

AB876,17,16 (2) Establishment and administration of program. (a) There is established a pilot catastrophic care program for employees who are eligible for coverage under group health benefit plans issued to small employers. The program shall operate for 5 years, beginning on January 1, 2003, in a region of the state that includes Winnebago County and that shall be determined and described by the commissioner by rule.

AB876,17,18 (b) The board shall oversee the operations of the program, and shall do all of the following:

AB876,17,20 1. Annually, by no later than April 30, establish a budget for the program for the next fiscal year.

AB876,17,23 2. Subject to sub. (3) (a) 4., establish the methodology for determining the premium to be charged a small employer for providing coverage under the program for an employee of the small employer.

AB876,18,3 3. Establish procedures for collecting and depositing in the fund the insurer assessments under sub. (3) (a) 2., the provider assessments under sub. (3) (a) 3., and the premiums under sub. (3) (a) 4.

AB876,18,7 4. Establish procedures for paying the costs of covered benefits for employees enrolled in the program, including procedures that small employer insurers must use for documenting and obtaining reimbursement of claims costs under sub. (6) (c), and for paying all other operating and administrative costs of the program.

AB876,18,22 5. Annually, by no later than April 30, based on data from the previous calendar year, perform a reconciliation with respect to program costs, the transfer to the fund under s. 20.145 (1) (g), insurer assessments under sub. (3) (a) 2., provider assessments under sub. (3) (a) 3., provider payment rate discounts under sub. (3) (b), and premiums under sub. (3) (a) 4. If the board determines that in the preceding calendar year the insurer assessments under sub. (3) (a) 2., or the provider assessments under sub. (3) (a) 3. in conjunction with the provider payment rate discounts under sub. (3) (b), were not equal to the transfer to the fund under s. 20.145 (1) (g), as required in sub. (3) (a) 2. and 3., the board shall make any necessary adjustments for the fiscal year beginning on the first July 1 after the reconciliation, by increasing or decreasing the insurer assessments under sub. (3) (a) 2., the provider assessments under sub. (3) (a) 3., or the provider payment rate discounts under sub. (3) (b) to reflect the amount by which the insurer assessments or provider assessments in conjunction with the provider payment rate discounts did not equal the amount of the transfer.

AB876,18,25 6. Provide for the procurement, in a competitive process, of a contract for the services of a qualified administrator to administer the program and to assist the board in its oversight of the program.

AB876,19,5 (3) Program funding. (a) In establishing the annual budget under sub. (2) (b) 1., the board shall determine and approve the amount of funding needed for the fiscal year to pay the anticipated costs of covered benefits for employees enrolled in the program and all other operating and administrative costs of the program. Funding for the program shall consist of all of the following:

AB876,19,7 1. The transfer to the fund from the appropriation account under s. 20.145 (1) (g).

AB876,19,18 2. Assessments paid by insurers that are established by the board and promulgated by the commissioner by rule and that annually equal the amount of the annual transfer under subd. 1. Each insurer's share of the assessment under this subdivision shall be determined annually by the commissioner based on annual statements and other reports filed by the insurer with the commissioner, and shall be in the same ratio as the insurer's total health care coverage revenue for residents of this state during the preceding calendar year bears to the aggregate health care coverage revenue of all insurers for residents of this state, as determined by the commissioner. The commissioner may by rule exempt as a class those insurers whose share would be so minimal as not to exceed the estimated cost of levying the assessment.

AB876,19,25 3. Assessments paid by providers that are established by the board and promulgated by the commissioner by rule and that, in conjunction with the provider discounts established under par. (b), annually equal the amount of the annual transfer under subd. 1. Each provider's share of the assessment under this subdivision shall be determined as provided in the rule under this subdivision. The commissioner may by rule exempt as a class those providers whose share would be so minimal as not to exceed the estimated cost of levying the assessment.

AB876,20,5 4. The premiums described in sub. (5) (c) 2., which shall be established by the board and promulgated by the commissioner by rule, and which shall be calculated on the basis of the amount by which the sum of the amounts under subds. 1. to 3. is not sufficient to pay the anticipated costs of covered benefits for employees enrolled in the program and all other operating and administrative costs of the program.

AB876,20,8 (b) 1. Subject to par. (a) 3., the commissioner by rule shall establish provider discount rates for charges for covered services provided to employees enrolled in the program.

AB876,20,14 2. Except for copayments, coinsurance, or deductibles required or authorized under the group health benefit plan for which the employee is eligible under sub. (4) (a) 1., a provider of a covered service, drug, or device shall accept as payment in full for the covered service, drug, or device the discounted payment rate under subd. 1. and may not bill the employee who receives the service, drug, or device for any amount by which the charge is reduced under subd 1.

AB876,20,16 (4) Employee eligibility. (a) An employee may be enrolled in the program if all of the following apply:

AB876,20,19 1. The employee is eligible for coverage under a group health benefit plan that is issued or renewed by a small employer insurer to a small employer on or between the dates specified by rule under sub. (7) (c).

AB876,20,21 2. The small employer is located in the region determined by rule under sub. (2) (a).

AB876,20,25 3. When the small employer insurer applies health status underwriting factors under s. 635.05 for determining premiums under the group health benefit plan under subd. 1., the small employer insurer determines that the employee is eligible to enroll in the program by using the guidelines established by rule under sub. (7) (a).

AB876,21,1 4. The small employer agrees to enroll the employee in the program.

AB876,21,3 5. The small employer pays the additional premium described in sub. (5) (c) 2. for the enrolled employee's coverage under the program.

AB876,21,9 (b) If an employee who is enrolled in the program becomes ineligible under par. (a), the employee may apply for coverage under the health insurance risk-sharing plan under ch. 149. If the employee applies for and obtains coverage under that plan and his or her application for coverage was received within 63 days after his or her enrollment under the program was terminated under this paragraph, the employee may not be subject to any preexisting condition exclusion under that plan.

AB876,21,14 (5) Premiums. (a) For every group health benefit plan issued or renewed to a small employer that agrees to enroll in the program an employee who is eligible under sub. (4) (a), the small employer insurer shall charge a total premium that includes an amount established by rule under sub. (3) (a) 4. for the employee's coverage under the program.

AB876,21,17 (b) The small employer insurer shall forward to the board, in the manner and time required by rule under sub. (7) (d), the premium amounts that are charged for coverage under the program.

AB876,21,21 (c) In addition to the disclosures required under s. 635.11, upon the issuance or renewal of a group health benefit plan to a small employer that agrees to enroll an employee in the program, the small employer insurer shall disclose to the small employer all of the following:

AB876,21,24 1. The amount of the total premium that is attributable to coverage under the group health benefit plan for the small employer's employees who are not enrolled in the program.

AB876,22,2 2. The amount of the total premium that is attributable to an employee's coverage under the program and that is established by rule under sub. (3) (a) 4.

AB876,22,7 (d) If a small employer does not agree to enroll in the program an employee who is otherwise eligible for enrollment under sub. (4) (a), the small employer insurer issuing or renewing the group health benefit plan to the small employer may apply health status underwriting factors and determine premiums for the group health benefit plan without regard to the requirements established under s. 635.05.

AB876,22,10 (6) Covered benefits; reimbursements. (a) Covered benefits for an employee who is enrolled in the program are the same as the covered benefits under the group health benefit plan for which the employee is eligible under sub. (4) (a) 1.

AB876,22,14 (b) All claims for covered benefits for an employee enrolled in the program shall be processed for payment or denial by the small employer insurer issuing or renewing the group health benefit plan for which the employee is eligible under sub. (4) (a) 1.

AB876,22,17 (c) At the direction of the board, the commissioner shall reimburse a small employer insurer from the appropriation under s. 20.145 (1) (q) for the cost of claims properly paid for covered benefits for an employee enrolled in the program.

AB876,22,19 (7) Rules. The commissioner shall promulgate rules developed by the board for the operation of the program, including rules that do all of the following:

AB876,22,22 (a) Establish guidelines that small employer insurers must use for health status underwriting for determining whether an employee is eligible for enrollment under the program.

AB876,23,2 (b) Specify the dates by which the insurer assessments under sub. (3) (a) 2. and the provider assessments under sub. (3) (a) 3. must be forwarded to the board for deposit in the fund. The earliest date specified under this paragraph must be at least 6 months before the earliest date specified under par. (c).

AB876,23,4 (c) Specify the dates that apply in sub. (4) (a) 1., subject to the requirement under par. (b).

AB876,23,7 (d) Specify the procedures that small employer insurers must use for collecting, segregating, holding in trust, and forwarding to the board, as well as the time for forwarding to the board, the premiums established under sub. (3) (a) 4.

AB876, s. 22 Section 22 . Nonstatutory provisions.

AB876,23,12 (1) Small employer catastrophic reinsurance board. Notwithstanding the length of terms specified for the members of the small employer catastrophic reinsurance board under section 15.735 (1) (b) of the statutes, as created by this act, the initial members shall be appointed for the following terms:

AB876,23,16 (a) Two members, one nominated by the National Federation of Independent Business and Wisconsin Independent Businesses, Inc., and one nominated by the Wisconsin Association of Life and Health Insurers, Inc., for terms expiring on May 1, 2005.

AB876,23,20 (b) Three members, one nominated by the Wisconsin Association of Life and Health Insurers, Inc., one nominated by the Wisconsin Association of Health Plans, and one nominated by the State Medical Society of Wisconsin, for terms expiring on May 1, 2006.

AB876,23,24 (c) Three members, one nominated by the National Federation of Independent Business and Wisconsin Independent Businesses, Inc., one nominated by the Wisconsin Association of Health Plans, and one nominated by the Wisconsin Health and Hospital Association, for terms expiring on May 1, 2007.

AB876,24,4 (2) Small employer catastrophic care board. Notwithstanding the length of terms specified for the members of the small employer catastrophic care board under section 15.735 (2) (b) of the statutes, as created by this act, the initial members shall be appointed for the following terms:

AB876,24,8 (a) Three members, one specified under section 15.735 (2) (a) 1. of the statutes, as created by this act, one specified under section 15.735 (2) (a) 2. of the statutes, as created by this act, and one specified under section 15.735 (2) (a) 3. of the statutes, as created by this act, for terms expiring on May 1, 2004.

AB876,24,12 (b) Four members, one specified under section 15.735 (2) (a) 1. of the statutes, as created by this act, 2 specified under section 15.735 (2) (a) 2. of the statutes, as created by this act, and one specified under section 15.735 (2) (a) 3. of the statutes, as created by this act, for terms expiring on May 1, 2005.

AB876,24,15 (c) Three members, 2 specified under section 15.735 (2) (a) 1. of the statutes, as created by this act, and one specified under section 15.735 (2) (a) 2. of the statutes, as created by this act, for terms expiring on May 1, 2006.

AB876,25,2 (3) Rules related to small employer insurer catastrophic risk. Using the procedure under section 227.24 of the statutes, the commissioner of insurance may promulgate the rules required under section 635.25 (4) (a) and (5) of the statutes, as created by this act, for the period before the effective date of the permanent rules required under section 635.25 (4) (a) and (5) of the statutes, as created by this act, but not to exceed the period authorized under section 227.24 (1) (c) and (2) of the statutes. Notwithstanding section 227.24 (1) (a), (2) (b), and (3) of the statutes, the commissioner is not required to provide evidence that promulgating a rule under this subsection as an emergency rule is necessary for the preservation of public peace, health, safety, or welfare and is not required to provide a finding of emergency for a rule promulgated under this subsection.

AB876,25,14 (4) Rules related to small employer catastrophic care. Using the procedure under section 227.24 of the statutes, the commissioner of insurance may promulgate the rules required under section 635.30 (2) (a), (3) (a) 2., 3., and 4. and (b) 1., and (7) of the statutes, as created by this act, for the period before the effective date of the permanent rules required under section 635.30 (2) (a), (3) (a) 2., 3., and 4. and (b) 1., and (7) of the statutes, as created by this act, but not to exceed the period authorized under section 227.24 (1) (c) and (2) of the statutes. Notwithstanding section 227.24 (1) (a), (2) (b), and (3) of the statutes, the commissioner is not required to provide evidence that promulgating a rule under this subsection as an emergency rule is necessary for the preservation of public peace, health, safety, or welfare and is not required to provide a finding of emergency for a rule promulgated under this subsection.

AB876,25,17 (5) Prescription drug cost reduction; report. (a) By January 1, 2003, the department of administration shall submit a report that identifies all of the following:

AB876,25,21 1. The participation by health care providers, insurers, and self-insurers in negotiating rebate agreements under section 16.735 (2) (a) of the statutes, as created by this act, and in developing in-state or multistate purchasing groups to negotiate reduced charges under section 16.735 (2) (b) of the statutes, as created by this act.

AB876,25,23 2. Strategies that the department of administration proposes to pursue to reduce costs for prescription drugs in this state.

AB876,26,2 (b) By January 1, 2005, the department of administration shall submit a report that specifies the status of implementing section 16.735 of the statutes, as created by this act, including any success or lack of success in reducing costs for prescription drugs in this state.

AB876,26,6 (c) The department of administration shall submit the reports specified in paragraphs (a) and (b) to the legislature in the manner provided under section 13.172 (3) of the statutes, to the members of the joint committee on finance, and to the governor.

AB876, s. 23 Section 23. Appropriation changes.

AB876,26,12 (1) Private employer health care coverage program. In the schedule under section 20.005 (3) of the statutes for the appropriation to the department of employee trust funds under section 20.515 (2) (a) of the statutes, as affected by the acts of 2001, the dollar amount is increased by $850,000 for fiscal year 2001-02 to increase funding for the purpose for which the appropriation is made.

AB876,26,17 (2) Transfer to small employer catastrophic care program fund. In the schedule under section 20.005 (3) of the statutes for the appropriation to the office of the commissioner of insurance under section 20.145 (1) (g) of the statutes, as affected by the acts of 2001, the dollar amount is increased by $500,000 for fiscal year 2002-03 to increase funding for the purposes for which the appropriation is made.

AB876, s. 24 Section 24. Effective dates. This act takes effect on the day after publication, except as follows:

AB876,26,23 (1) Notice of independent review. The treatment of section 632.835 (2) (b) and (bg) of the statutes takes effect on the date stated in the notice published by the commissioner of insurance in the Wisconsin Administrative Register under section 632.835 (8) of the statutes.

AB876,26,24 (End)