HB 2603 — health plans; providers; payment reporting

HB2603 - 541R - IH-Health Ver&  Human Services-Adopted   Fifty-fourth Legislature                                                         First Regular Session                                                              REFERENCECOMMITTEE TITLE:ON HEALTH & HUMAN SERVICES HOUSE OF REPRESENTATIVES AMENDMENTS TO H.B.

health2603 plans;(Reference to printed bill)       Page 1, line 6, after "A." strike remainder of line Strike lines and 8 Line 9, strike "facility and physician group.";

providers;after "report" insert "to the department" Line 11, after "outpatient" insert "relative" Between lines 24 and 25, insert:

payment"B.  Health reportingplans  shall  not  provide Stateclaims ofinformation Arizonaor Housecontract prices to the department, but shall report only relative prices." Reletter to conform Line 26, strike "all of Representativesthe" Fifty-fourthStrike Legislaturelines Firstthrough Regular43 SessionPage  2,  strike HBlines 26031  through Introduced13, insert "the relative value of the alternative payment contract and nonclaim payments pursuant to rules adopted by Representativethe Kerndepartment."  Reletter  to ANconform ACTLine  15, Amendingstrike Title"and the" Strike line Line 17, strike "facility and physician group" Line 18, strike "shall identify" insert "that identifies" Strike lines through 34 Line 36, chapterafter 1,"department" articleinsert 1.1,"except Arizonaas Revisednecessary Statutes,to produce the reports required by addingthis sectionsection" 36‑125.08;Line 41, strike "health care";

relatingstrike to"a uniformpublic reporting.health plan or" Page 2, line 42, after "private" insert "health care";

 strike (TEXT"methods" OFinsert BILL"methodologies" BEGINSLine ON43, NEXTstrike PAGE)"methods"  insert Be"methodologies" itPage enacted3, byline the11, Legislaturestrike of the Statecomma ofinsert Arizona:"and";

Section 1.  Titlestrike 36,"and chapter"health 1,plan"" articleBetween 1.1,lines Arizona13 Revisedand Statutes,14, isinsert: amended by adding section 36-125.08, to read:

START_STATUTE36-125.08.  Health"5.  "Health plans;plan":

(a)  Means a health care providers;services organization, a hospital service organization, a medical service organization and a hospital, medical, dental and optometric service organization authorized to transact insurance business pursuant to title 20.

reporting(b)  Does requirements;not include an insurer or plan that provides benefits pursuant to chapter 29, article 1 of this title." Renumber to conform Line 16, after "title" insert "and in accordance with title XIX of the social security act" Strike lines through 19 Renumber to conform Line 21, strike "and public" Strike lines through 31 Amend title to conform And, as so amended, it do pass   NANCY K.

relativeBARTO prices;CHAIRMAN     2603HEALTH  HUMAN SERVICES 02/21/2019 05:38 PM H:

definitionsra A.  Each health plan shall report the information required by this section and rules adopted by the department to enable the department to calculate the weighted average payor rate for each hospital, outpatient facility and physician group.  Each health plan shall report:

1.  The relative price paid to each health care provider by type of provider, with hospital inpatient and outpatient prices listed separately, and health plan product type.

2.  The annual rate of growth stated as a percentage of the average relative price by provider type and product type for the health plan's participating health care providers, and whether that rate exceeds the rate of growth of the applicable producer price index as reported by the United States department of labor, bureau of labor statistics.

3.  A comparison of relative prices for the health plan's participating health care providers by provider type that shows the average relative price and the extent of variation in price stated as a percentage and that identifies providers who are paid more than ten percent, fifteen percent and twenty percent above the average relative price and more than ten percent, fifteen percent and twenty percent below the average relative price.

B.  Each health plan that uses an alternative payment contract to pay health care providers shall disclose to the department all of the following:

1.  The negotiated monthly or yearly budget for each alternative payment contract in the current contract year.

2.  Any applicable measures of provider performance in the alternative payment contract.

3.  If applicable, the average negotiated monthly or yearly budget weighted by member months for each geographic region of this state as further defined in rules adopted by the department.

C.  For the purposes of subsection B of this section:

1.  Health plans shall report the negotiated budget assuming a neutral health status score of 1.0 using an industry accepted health status adjustment tool and, if applicable, shall separately report the budget allowances for:

(a)  All medical and behavioral health care, substance use disorders and mental health care provided by both in‑network and out‑of‑network providers.

(b)  Pharmacy coverage allowances.

(c)  Administrative expenses such as data analytics, health information technology, clinical program development and other program management fees.

(d)  The purchase of reinsurance or stop‑loss coverage.

(e)  Quality bonus monies, unit cost adjustments or other special allowances as may be required in rules adopted by the department.

2.  If out‑of‑network care, behavioral health care, substance use disorders and mental health care, stop‑loss insurance or any other clinical services are carved out of any global budget, bundled payments or other alternative payment method such that there is no allowance included in the budget for those services, health plans shall report actual claims costs of these items on a per member, per month basis for the year immediately preceding the current contract year.

D.  The department shall issue an annual report on relative prices paid by health plans and received by health care providers and the weighted average payor rate paid to each acute care hospital, outpatient facility and physician group.  The department shall present the report in a manner that does not disclose actual prices paid and shall identify price variation among health care providers, by health plan and by provider type.

The department's report shall include all of the following:

1.  Baseline information about price variation among health care providers by each health plan, including identifying health care providers that are paid more than ten percent above or more than ten percent below the average relative price and identifying health plans that have entered into alternative payment contracts that vary by more than ten percent.

2.  The annual change in price variation by health plan among the health plan's participating providers.

3.  Factors that contribute to price variation in the health care system.

4.  The impact of price variations on disproportionate share hospitals and other safety net providers.

5.  The impact of health reform efforts on price variation, including the impact of increased price transparency and the use of alternative payment contracts.

E.  Data collected by the department under this section is not a public record and shall be held in confidence by the department.

F.  The department may adopt rules necessary to implement this section.

G.  For the purposes of this section:

1.  "Alternative payment contract" means any contract between a health care provider or provider organization and a public health plan or a private health plan that uses alternative payment methods.

2.  "Alternative payment methods":

(a)  Means methods of payment that are not based solely on fee‑for‑service reimbursements.