HB 285 — SHORT-TERM & LIMITED-BENEFIT PLAN ACT

h (f) termination of insurance;

g o (g) probationary periods;

t hr g e i k (h) limitations;

h r i s (i) exceptions;

h , t, (j) reductions and exclusions;

e u g e b l e e h (k) elimination periods;

n d d i = = o h (l) requirements for replacement by the l ] b ,d i a º e health insurance carrier;

r i = r t e w d (m) recurrent conditions;

m(n) athe ndefinition oof dterms mto :describe the specific types of coverage sold pursuant to the Short-Term Health Plan and Excepted Benefit Act and specific standards and policy provisions required of these plans;

b e d s º o t n = .213296.3 s k m e - 6 - e a n e d r e l u [ A d (n) the definition of terms to describe the specific types of coverage sold pursuant to the Short-Term Health Plan and Excepted Benefit Act and specific standards and policy provisions required of these plans;

HHHC/HB 285/a Page 6 (r) sales practices;

All advertisements, marketing materials and application and policy forms relating to short-term plans shall prominently display a notice that the coverage is unavailable to any potential insured who has been covered under a short-short-term term plan in the previous twelve-month period." SECTION 4.

"[NEW"BENEFITS--MINIMUM MATERIAL] BENEFITS--MINIMUM STANDARDS.-- h A.

The superintendent shall adopt and promulgate g o rules to establish minimum standards for benefits provided by t hr g e i k short-term plans and excepted benefits plans that are subject h r i s to the Short-Term Health Plan and Excepted Benefit Act.

h , t, B.

Rules of the superintendent shall require e u g e b l short-term plans to cover state-mandated benefits in addition e e h n d d i = = o h to each of the following categories of benefits:

l ] b ,d i a º e (1) diagnostic;

r i = r t e w d (2) rehabilitative;

m(3) amaternity; n o d m :

b e d s º o t n = .213296.3 s k m e - 7 - e a n e d r e l u [ A d HHHC/HB 285 (3) maternity;

HHHC/HB 285/a Page 7 (7) hospitalization;

"[NEW"RATES--MEDICAL MATERIAL] RATES--MEDICAL LOSS RATIOS.--The superintendent shall adopt and promulgate rules to establish standards for rates, including medical loss ratios, of short-term plans and excepted benefits plans.

A new section of the New Mexico Insurance Code h is enacted to read:

g"PROHIBITION--ASSOCIATION, o "[NEW MATERIAL] PROHIBITION--ASSOCIATION, TRUST OR t hr g e i k MULTIPLE EMPLOYER WELFARE ARRANGEMENT PLANS.--No insurer shall h r i s issue, and no association, trust or multiple employer welfare h , t, arrangement shall offer, a short-term or excepted benefits plan e u g e b l e e h to a resident of the state unless through a bona fide n d d i = = o h association." l ] b ,d i a º e SECTION 7.

A new section of Chapter 59A, Article 16 NMSA r i = r t e w d m a n o 1978 is enacted to read:

d"HEALTH mBENEFITS :PLANS--PROHIBITION--UNLICENSED HEALTH BENEFITS PLANS--UNAPPROVED HEALTH BENEFITS PLANS.-- A.

bNo eperson dor sentity ºshall osell tor nissue, =or .213296.3cause sto kbe msold eor -issued, 8 - e a nhealth ebenefits dplan rthat eis lHHHC/HB u285/a [Page A8 dunlicensed "[NEWor MATERIAL]unapproved HEALTHfor BENEFITSsale PLANS--PROHIBITION--or UNLICENSEDdelivery HEALTHin BENEFITSthe PLANS--UNAPPROVEDstate. HEALTH BENEFITS PLANS.-- A.

No person or entity shall sell or issue, or cause to be sold or issued, a health benefits plan that is unlicensed or unapproved for sale or delivery in the state.

and (2) "health insurance carrier" means an entity subject to the insurance laws and regulations of this state, including a health insurance company, a health maintenance organization, a hospital and health services corporation, a provider service network, a nonprofit health care plan or any h other entity that contracts or offers to contract, or enters g o into agreements to provide, deliver, arrange for, pay for or t hr g e i k reimburse any costs of health care services, or that provides, h r i s offers or administers health benefits plans or managed health h , t, care plans in this state." e u g e b l SECTION 8.

Section 59A-22-50 NMSA 1978 (being Laws 2010, e e h n d d i = = o h Chapter 94, Section 1, as amended) is amended to read:

l ] b ,d i a º e "59A-22-50.

HEALTH INSURERS--DIRECT SERVICES.-- r i = r t e w d A.

A health insurer shall make reimbursement for mdirect services at a nlevel onot dless mthan :eighty-five percent of premiums across all health product lines, including short- HHHC/HB 285/a Page 9 term plans and excluding individually underwritten health insurance policies, contracts or plans, that are governed by the provisions of Chapter 59A, Article 22 NMSA 1978, the Health Maintenance Organization Law and the Nonprofit Health Care Plan Law, and an excepted benefit policy intended to supplement major medical coverage, including medicare supplement, vision, dental, disease-specific, accident-only or hospital indemnity-only insurance policies, or a plan that only issues policies for long-term care or disability income.

b e d s º o t n = .213296.3 s k m e - 9 - e a n e d r e l u [ A d HHHC/HB 285 direct services at a level not less than eighty-five percent of premiums across all health product lines, [except ] including short-term plans and excluding individually underwritten health insurance policies, contracts or plans, that are governed by the provisions of Chapter 59A, Article 22 NMSA 1978, the Health Maintenance Organization Law and the Nonprofit Health Care Plan Law, and an excepted benefit policy intended to supplement major medical coverage, including medicare supplement, vision, dental, disease-specific, accident-only or hospital indemnity-only insurance policies, or a plan that only issues policies for long-term care or disability income.

Nothing in this subsection shall be construed to preclude a purchaser from h negotiating an agreement with a health insurer that requires a u » r higher amount of premiums paid to be used for reimbursement for t h g e direct services for one or more products or for one or more l i h r i s years.

h , e h B.

For individually underwritten health care t u g e b l policies, plans or contracts, the superintendent shall e e , gh n d d i = = o h establish, after notice and informal hearing, the level of l ] b ,d i a º r reimbursement for direct services, as determined by the reports e r = t e w d filed with the office of superintendent of insurance, as a mpercent aof npremiums. o d m :

b r e t º o t n = .213296.3 s k m e - 10 - e a n e d r e l u [ A d percent of premiums.

In establishing HHHC/HB 285/a Page 10 the level of reimbursement for direct services, the superintendent shall consider the costs associated with the individual marketing and medical underwriting of these policies, plans or contracts at a level not less than seventy-five percent of premiums.

HCEDCº C.

ForAn exceptedinsurer benefitthat policies,fails plansto orcomply contracts,with the superintendentreimbursement requirements pursuant to this section shall establishissue bya ruledividend or credit against future premiums to all policyholders in an amount sufficient to ensure that the levelbenefits paid in the preceding three calendar years plus the amount of reimbursementthe fordividends or credits are equal to the required direct services,services whichreimbursement level pursuant to Subsection A of hthis reimbursementsection shallfor begroup determinedhealth bycoverage reportsand filedblanket withhealth coverage or the grequired odirect officeservices ofreimbursement superintendentlevel pursuant to Subsection B of insurance,this assection afor percentindividually ofHHHC/HB t285/a hrPage g11 eunderwritten ihealth kpolicies, premiums.contracts or plans for the preceding three calendar years.

AIf healththe insurer writingfails theseto policies,issue plansthe dividend or hcredit rin iaccordance swith contractsthe shallrequirements makeof reimbursementthis forsection, directthe servicessuperintendent atshall aenforce hthese ,requirements t,and levelmay notpursue lessany thanother thatpenalties levelas establishedprovided by thelaw, eincluding ugeneral gpenalties e b l e e h superintendent pursuant to thisSection subsection59A-1-18 overNMSA the1978. three n d d i = = o h calendar years preceding the date upon which the rate is l ] b ,d i a º e established.

NothingD. in this subsection shall be construed to r i = r t e w d m a n o preclude a purchaser of one of these policies, plans or d m :

bAfter enotice dand shearing, ºthe osuperintendent tmay nadopt =and .213296.3promulgate sreasonable krules mnecessary eand -proper 11 - e a n e d r e l u [ A d HHHC/HB 285 contracts from negotiating an agreement with a health insurer that requires a higher amount of premiums paid to becarry usedout forthe reimbursementprovisions of directthis services.»HCEDCsection. [C.] HCEDCºD.

C.»HCEDCE. An insurer that fails to comply with the reimbursement requirements pursuant to this section shall issue a dividend or credit against future premiums to all policyholders in an amount sufficient to [assure ] ensure that the benefits paid in the preceding three calendar years plus the amount of the dividends or credits are equal to the required direct services reimbursement level pursuant to Subsection A of this section for group health coverage and blanket health coverage or the required direct services reimbursement level pursuant to Subsection B of this section for individually underwritten health policies, contracts or plans for the preceding three calendar years.

IfFor the insurerpurposes fails to issue the dividend or credit in accordance with the h requirements of this section,section: the superintendent shall enforce u » r these requirements and may pursue any other penalties as t h g e l i provided by law, including general penalties pursuant to h r i s Section 59A-1-18 NMSA 1978.

h(1) ,"direct eservices" hmeans [D.services rendered to an individual by a health insurer or a health care practitioner, facility or other provider, including case management, disease management, health education and promotion, preventive services, quality incentive payments to providers and any portion of an assessment that covers services rather than administration and for which an insurer does not receive a tax credit pursuant to the Medical Insurance Pool Act;

] HCEDCºE.

D.»HCEDC After notice and hearing, the t u g e b l e e , gh superintendent may adopt and promulgate reasonable rules n d d i = = o h necessary and proper to carry out the provisions of this l ] b ,d i a º r section.

e r = t e w d m a n o [E.

] HCEDCºF.

E.»HCEDC For the purposes of this section:

d m :

b r e t º o t n = .213296.3 s k m e - 12 - e a n e d r e l u [ A d (1) "direct services" means services rendered to an individual by a health insurer or a health care practitioner, facility or other provider, including case management, disease management, health education and promotion, preventive services, quality incentive payments to providers and any portion of an assessment that covers services rather than administration and for which an insurer does not receive a tax credit pursuant to the Medical Insurance Pool Act [or the Health Insurance Alliance Act];

(2) "health insurer" means a person duly authorized to transact the business of health insurance in HHHC/HB 285/a Page 12 the state pursuant to the Insurance Code, [but does not include ] including a person that issues a short-term plan and a person that only issues [a limited-benefit ] an excepted benefit policy intended to supplement major medical coverage, including medicare supplement, vision, dental, disease-specific, h accident-only or hospital indemnity-only insurance policies, or g o that only issues policies for long-term care or disability t hr g e i k income;

[and ] h r i s (3) "premium" means all income received from h , t, individuals and private and public payers or sources for the e u g e b l procurement of health coverage, including capitated payments, e e h n d d i = = o h self-funded administrative fees, self-funded claim l ] b ,d i a º e reimbursements, recoveries from third parties or other insurers r i = r t e w d and interests less any premium tax paid pursuant to Section m59A-6-2 NMSA 1978 and fees associated with participating in a nhealth oinsurance dexchange mthat :serves as a clearinghouse for insurance;

b e d s º o t n = .213296.3 s k m e - 13 - e a n e d r e l u [ A d HHHC/HB 285 59A-6-2 NMSA 1978 and fees associated with participating in a health insurance exchange that serves as a clearinghouse for insurance;

and (b) is issued only to individuals who have not been enrolled in a health benefits plan that provides the same or similar nonrenewable coverage from any HHHC/HB 285/a Page 13 health insurance carrier within the three months preceding enrollment in the short-term plan." SECTION 9.

That version of Section 59A-22-50 NMSA 1978 (being Laws 2010, Chapter 94, Section 1, as amended) that is to h become effective January 1, 2020 is amended to read:

u » r "59A-22-50.

HEALTH INSURERS--DIRECT SERVICES.-- t h g e A.

A health insurer shall make reimbursement for l i h r i s direct services at a level not less than eighty-five percent of h , e h premiums across all health product lines, [except ] including tshort- uterm g e b l short-term plans and excluding individually underwritten health e e , gh n d d i = = o h insurance policies, contracts or plans, that are governed by l ] b ,d i a º r the provisions of Chapter 59A, Article 22 NMSA 1978, the Health e r = t e w d Maintenance Organization Law and the Nonprofit Health Care Plan mLaw, and an excepted benefit policy intended to supplement major medical coverage, including medicare supplement, vision, dental, disease-specific, accident-only or hospital indemnity-only insurance policies, or a nplan othat donly missues :policies for long-term care or disability income.

b r e t º o t n = .213296.3 s k m e - 14 - e a n e d r e l u [ A d Law, and an excepted benefit policy intended to supplement major medical coverage, including medicare supplement, vision, dental, disease-specific, accident-only or hospital indemnity- only insurance policies, or a plan that only issues policies for long-term care or disability income.

Nothing in this subsection shall be construed to preclude a purchaser from negotiating an agreement with a health insurer that requires a higher amount of premiums paid to be used for reimbursement HHHC/HB 285/a Page 14 for direct services for one or more products or for one or more years.

Additional informal hearings may be held h at the superintendent's discretion.

In establishing the level g o of reimbursement for direct services, the superintendent shall t hr g e i k consider the costs associated with the individual marketing and h r i s medical underwriting of these policies, plans or contracts at a h , t, level not less than seventy-five percent of premiums.

A health e u g e b l insurer writing these policies shall make reimbursement for e e h n d d i = = o h direct services at a level not less than that level established l ] b ,d i a º e by the superintendent pursuant to this subsection over the r i = r t e w d three calendar years preceding the date upon which that rate is mestablished, abut nnot oearlier dthan mcalendar :year 2010.

b e d s º o t n = .213296.3 s k m e - 15 - e a n e d r e l u [ A d HHHC/HB 285 established, but not earlier than calendar year 2010.

HCEDCº C.

ForAn exceptedinsurer benefitthat policies,fails plansto orcomply contracts,with the superintendentHHHC/HB 285/a Page 15 reimbursement requirements pursuant to this section shall establishissue bya ruledividend or credit against future premiums to all policyholders in an amount sufficient to ensure that the levelbenefits paid in the preceding three calendar years plus the amount of reimbursementthe fordividends or credits are equal to the required direct services,services whichreimbursement level pursuant to Subsection A of reimbursementthis shallsection befor determinedgroup byhealth reportscoverage filedand withblanket health coverage or the officerequired ofdirect superintendentservices ofreimbursement insurance,level aspursuant ato percentSubsection B of premiums.this section for individually underwritten health policies, contracts or plans for the preceding three calendar years.

A health insurer writing these policies, plans or contracts shall make reimbursement for direct services at a level not less than that level established by the superintendent pursuant to this subsection over the three calendar years preceding the date upon which the rate is h established.

Nothing in this subsection shall be construed to u » r preclude a purchaser of one of these policies, plans or t h g e l i contracts from negotiating an agreement with a health insurer h r i s that requires a higher amount of premiums paid to be used for h , e h reimbursement of direct services.»HCEDC t u g e b l e e , gh [C.] HCEDCºD.

C.»HCEDC An insurer that fails to comply n d d i = = o h with the reimbursement requirements pursuant to this section l ] b ,d i a º r shall issue a dividend or credit against future premiums to all e r = t e w d m a n o policyholders in an amount sufficient to [assure ] ensure that d m :

b r e t º o t n = .213296.3 s k m e - 16 - e a n e d r e l u [ A d the benefits paid in the preceding three calendar years plus the amount of the dividends or credits are equal to the required direct services reimbursement level pursuant to Subsection A of this section for group health coverage and blanket health coverage or the required direct services reimbursement level pursuant to Subsection B of this section for individually underwritten health policies, contracts or plans for the preceding three calendar years.

[D.D.

]After HCEDCºE.notice and hearing, the superintendent may adopt and promulgate reasonable rules necessary and proper to carry out the provisions of this section.

D.»HCEDCE. After notice and hearing, the superintendent may adopt and promulgate reasonable rules necessary and proper to carry out the provisions of this section.

[E.For the purposes of this section:

](1) HCEDCºF."direct services" means services rendered to an individual by a health insurer or a health care practitioner, facility or other provider, including case management, disease management, health education and promotion, preventive services, quality incentive payments to HHHC/HB 285/a Page 16 providers and any portion of an assessment that covers services rather than administration and for which an insurer does not receive a tax credit pursuant to the Medical Insurance Pool Act;

E.»HCEDCprovided, Forhowever, thethat purposes"direct ofservices" thisdoes section:not include care coordination, utilization review or management or any other activity designed to manage utilization or services;

(1)(2) "direct"health services"insurer" means servicesa renderedperson hduly authorized to antransact individualthe bybusiness aof health insurerinsurance orin athe healthstate carepursuant gto othe practitioner,Insurance facilityCode, or other provider, including casea tperson hrthat gissues ea ishort-term kplan management, disease management, health education and promotion,a hperson rthat ionly sissues preventivean services,excepted qualitybenefit incentivepolicy paymentsintended to providerssupplement hmajor ,medical t,coverage, andincluding anymedicare portionsupplement, ofvision, andental, assessmentdisease-specific, thataccident-only coversor serviceshospital ratherindemnity-only einsurance upolicies, gor ethat bonly lissues epolicies e h than administration and for whichlong-term ancare insureror doesdisability notincome; receive a n d d i = = o h tax credit pursuant to the Medical Insurance Pool Act;

l(3) ]"premium" bmeans ,dall iincome areceived ºfrom eindividuals provided,and however,private thatand "directpublic services"payers doesor notsources includefor carethe rprocurement iof =health rcoverage, tincluding ecapitated wpayments, dself-funded coordination,administrative utilizationfees, reviewself-funded orclaim managementreimbursements, recoveries from third parties or other insurers and interests less any othertax mpaid pursuant to the Insurance Premium Tax Act and fees associated with participating in a nhealth oinsurance dexchange mthat :serves as a clearinghouse for insurance;

band eHHHC/HB d285/a sPage º17 o(4) t"short-term nplan" =means .213296.3a snonrenewable khealth mbenefits eplan -covering 17 - e a nresident eof dthe rstate, eregardless lof uwhere [the Aplan dis HHHC/HBdelivered, 285that: activity designed to manage utilization or services;

(2)(a) "healthhas insurer" means a personmaximum dulyspecified authorizedduration toof transactnot themore businessthan ofthree healthmonths insuranceafter in the stateeffective pursuantdate toof the Insuranceplan; Code, [but does not include ] including a person that issues a short-term plan and a person that only issues [a limited-benefit ] an excepted benefit policy intended to supplement major medical coverage, including medicare supplement, vision, dental, disease-specific, accident-only or hospital indemnity-only insurance policies, or that only issues policies for long-term care or disability income;

[and ] (3) "premium" means all income received from individuals and private and public payers or sources for the procurement of health coverage, including capitated payments, self-funded administrative fees, self-funded claim reimbursements, recoveries from third parties or other insurers h and interests less any tax paid pursuant to the Insurance g o Premium Tax Act and fees associated with participating in a t hr g e i k health insurance exchange that serves as a clearinghouse for h r i s insurance;

and h , t, (4) "short-term plan" means a nonrenewable e u g e b l e e h health benefits plan covering a resident of the state, n d d i = = o h regardless of where the plan is delivered, that:

l ] b ,d i a º e (a) has a maximum specified duration of r i = r t e w d not more than three months after the effective date of the m a n o d m :

b e d s º o t n = .213296.3 s k m e - 18 - e a n e d r e l u [ A d plan;

h B.

"capitated basis" means fixed per member per gHHHC/HB o285/a Page 18 month payment or percentage of premium payment wherein the t hr g e i k provider assumes the full risk for the cost of contracted h r i s services without regard to the type, value or frequency of h , t, services provided and includes the cost associated with e u g e b l operating staff model facilities;

e e h n d d i = = o h C.

"carrier" means a health maintenance l ] b ,d i a º e organization, an insurer, a nonprofit health care plan or other r i = r t e w d entity responsible for the payment of benefits or provision of mservices under a ngroup ocontract; d m :

b e d s º o t n = .213296.3 s k m e - 19 - e a n e d r e l u [ A d HHHC/HB 285 services under a group contract;

"direct services" means services rendered to an individual by a carrier or a health care practitioner, facility or other provider, which services include case management, disease management, health education and promotion, preventive services, quality incentive payments to HHHC/HB 285/a Page 19 providers and any h proportion of an assessment that covers services rather than u » r administration and for which a carrier does not receive a tax t h g e credit pursuant to the Medical Insurance Pool Act;

provided l i h r i s that "direct services" does not include care coordination, h , e h utilization review or management or any other activity designed t u g e b l to manage utilization or services;

e e , gh n d d i = = o h [G.] H.

"enrollee" means an individual who is l ] b ,d i a º r covered by a health maintenance organization;

e r = t e w d [H.] I.

"evidence of coverage" means a policy, mcontract aor ncertificate oshowing dthe messential :features and services of the health maintenance organization coverage that is given to the subscriber by the health maintenance organization or by the group contract holder;

bJ. r e t º o t n = .213296.3 s k m e - 20 - e a n e d r e l u [ A d contract or certificate showing the essential features and services of the health maintenance organization coverage that is given to the subscriber by the health maintenance organization or by the group contract holder;

[I.

] J.

[J.K.

] K.

[K.L.

]"group L.contract" means a contract for health HHHC/HB 285/a Page 20 care services that by its terms limits eligibility to members of a specified group and may include coverage for dependents;

"groupM. contract" means a contract for health care services that by its terms limits eligibility to members of a specified group and may include coverage for dependents;

[L."group contract holder" means the person to whom a group contract has been issued;

]N. M.

"group"health contractcare holder"services" means any services included in the personfurnishing to hany whomindividual aof groupmedical, contractmental, hasdental, beenpharmaceutical issued;or optometric care or hospitalization or nursing home care or incident to the furnishing of such care or hospitalization, as well as the furnishing to any person of any and all other services for the purpose of preventing, alleviating, curing or healing human physical or mental illness or injury;

gO. o [M.

]"health N.maintenance organization" means a person that undertakes to provide or arrange for the delivery of basic health care services to enrollees on a prepaid basis, except for enrollee responsibility for copayments or deductibles, including a carrier that issues:

"health care services" means any services t hr g e i k included in the furnishing to any individual of medical, h r i s mental, dental, pharmaceutical or optometric care or h , t, hospitalization or nursing home care or incident to the e u g e b l furnishing of such care or hospitalization, as well as the e e h n d d i = = o h furnishing to any person of any and all other services for the l ] b ,d i a º e purpose of preventing, alleviating, curing or healing human r i = r t e w d physical or mental illness or injury;

m a n o d m :

b e d s º o t n = .213296.3 s k m e - 21 - e a n e d r e l u [ A d HHHC/HB 285 [N.

] O.

"health maintenance organization" means [any] a person [who] that undertakes to provide or arrange for the delivery of basic health care services to enrollees on a prepaid basis, except for enrollee responsibility for copayments or deductibles, including a carrier that issues:

[O.]HHHC/HB 285/a Page 21 P.

"health maintenance organization agent" means a person who solicits, negotiates, effects, procures, delivers, renews or continues a policy or contract for health maintenance organization membership or who takes or transmits a h membership fee or premium for such a policy or contract, other g o than for that person, or a person who advertises or otherwise t hr g e i k makes any representation to the public as such;

hQ. r i s [P.

]"individual Q.contract" means a contract for health care services issued to and covering an individual and it may include dependents of the subscriber;

"individualR. contract" means a contract for h , t, health care services issued to and covering an individual and e u g e b l e e h it may include dependents of the subscriber;

n"insolvent" dor d"insolvency" imeans =that =the oorganization hhas [Q.been declared insolvent and placed under an order of liquidation by a court of competent jurisdiction;

]S. R.

"insolvent" or "insolvency" means that the l ] b ,d i a º e organization has been declared insolvent and placed under an r i = r t e w d order of liquidation by a court of competent jurisdiction;

m a n o d m :

b e d s º o t n = .213296.3 s k m e - 22 - e a n e d r e l u [ A d [R.] S.

[S.T.

] T.

[T.U.

]"participating U.provider" means a provider as defined in Subsection Z of this section that, under an express contract with the health maintenance organization or with its contractor or subcontractor, has agreed to provide health care services to enrollees with an expectation of HHHC/HB 285/a Page 22 receiving payment, other than copayment or deductible, directly or indirectly from the health maintenance organization;

"participatingV. provider" means a provider as defined in Subsection [X ] Z of this section [who] that, under an express contract with the health maintenance organization or with its contractor or subcontractor, has agreed to provide health care services to enrollees with an expectation of receiving payment, other than copayment or deductible, directly or indirectly from the health maintenance organization;

[U.

] V.

[V.W.

] W.

[W.X.

]"pharmacist X.clinician" means a pharmacist who exercises prescriptive authority pursuant to the Pharmacist Prescriptive Authority Act;

"pharmacistY. clinician" means a pharmacist h who exercises prescriptive authority pursuant to the Pharmacist g o Prescriptive Authority Act;

t"premium" hrmeans gall eincome ireceived kfrom Y.individuals and private and public payers or sources for the procurement of health coverage, including capitated payments, self-funded administrative fees, self-funded claim reimbursements, recoveries from third parties or other carriers and interests less any premium tax paid pursuant to Section 59A-6-2 NMSA 1978 and fees associated with participating in a health insurance exchange that serves as a clearinghouse for insurance;

"premium"Z. means all income received from h r i s individuals and private and public payers or sources for the h , t, procurement of health coverage, including capitated payments, e u g e b l self-funded administrative fees, self-funded claim e e h n d d i = = o h reimbursements, recoveries from third parties or other carriers l ] b ,d i a º e and interests less any premium tax paid pursuant to Section r i = r t e w d 59A-6-2 NMSA 1978 and fees associated with participating in a m a n o d m :

b e d s º o t n = .213296.3 s k m e - 23 - e a n e d r e l u [ A d HHHC/HB 285 health insurance exchange that serves as a clearinghouse for insurance;

[X.] Z.

[Y.] AA.

"short-term contract" means a nonrenewable HHHC/HB 285/a Page 23 health maintenance organization contract covering a resident of the state, regardless of where the contract is delivered, that:

and (2) is issued only to individuals who have not been enrolled in a health maintenance organization contract that provides the same or similar nonrenewable coverage from h any carrier within the three months preceding enrollment in the g o short-term contract;

t hr g e i k [Z.] CC.

"subscriber" means an individual whose h r i s employment or other status, except family dependency, is the h , t, basis for eligibility for enrollment in the health maintenance e u g e b l e e h organization or, in the case of an individual contract, the n d d i = = o h person in whose name the contract is issued;

and lDD. ] b ,d i a º e [AA.

]"uncovered DD.expenditures" means the costs to the health maintenance organization for health care services that are the obligation of the health maintenance organization, for which an enrollee may also be liable in the event of the health maintenance organization's insolvency and for which no alternative arrangements have been made that are acceptable to the superintendent." SECTION 11.

"uncoveredSection expenditures"59A-46-51 meansNMSA the1978 costs(being rLaws iHHHC/HB =285/a rPage t24 e2010, wChapter d94, toSection the3, healthas maintenanceamended) organizationis foramended healthto careread: services m a n o d m :

b e d s º o t n = .213296.3 s k m e - 24 - e a n e d r e l u [ A d that are the obligation of the health maintenance organization, for which an enrollee may also be liable in the event of the health maintenance organization's insolvency and for which no alternative arrangements have been made that are acceptable to the superintendent." SECTION 11.

Section 59A-46-51 NMSA 1978 (being Laws 2010, Chapter 94, Section 3, as amended) is amended to read:

A health maintenance organization shall make reimbursement for direct services at a level not less than eighty-five percent of premiums across all health product lines, [except ] including short-term contracts and excluding individually underwritten health insurance policies, contracts or plans, that are governed by the provisions of Chapter 59A, Article 22 NMSA 1978, the Health Maintenance Organization Law and the Nonprofit Health Care Plan Law, and an excepted benefit health maintenance organization contract intended to supplement major medical coverage, including medicare supplement, vision, h dental, disease-specific, accident-only or hospital indemnity-indemnity-only u » r only insurance contracts, or a carrier that only issues t h g e contracts for long-term care or disability income.

l i h r i s Reimbursement shall be made for direct services provided over h , e h the preceding three calendar years, but not earlier than t u g e b l calendar year 2010, as determined by reports filed with the e e , gh n d d i = = o h office of superintendent of insurance.

Nothing in this l ] b ,d i a º r subsection shall be construed to preclude a purchaser from e r = t e w d negotiating an agreement with a health maintenance organization mthat requires a nhigher oamount dof mpremiums :paid to be used for reimbursement for direct services for one or more products or for one or more years.

bHHHC/HB r285/a ePage t º o t n = .213296.3 s k m e - 25 -B. e a n e d r e l u [ A d HHHC/HB 285 that requires a higher amount of premiums paid to be used for reimbursement for direct services for one or more products or for one or more years.

B.

A health insurer or health maintenance organization writing these policies, plans or contracts shall make reimbursement for h direct services at a level not less than that level established u » r by the superintendent pursuant to this subsection over the t h g e three calendar years preceding the date upon which that rate is l i h r i s established, but not earlier than calendar year 2010.

Nothing h , e h in this subsection shall be construed to preclude a purchaser t u g e b l of one of these policies, plans or contracts from negotiating e e , gh n d d i = = o h an agreement with a health insurer or health maintenance l ] b ,d i a º r organization that requires a higher amount of premiums paid to e r = t e w d be used for reimbursement for direct services.

mC. a n o d m :

bA rhealth emaintenance torganization ºthat ofails tto nHHHC/HB =285/a .213296.3Page s26 kcomply mwith ethe -reimbursement 26requirements -pursuant eto this section shall issue a ndividend eor dcredit ragainst efuture lpremiums uto [all policy or contract holders in an amount sufficient to ensure that the benefits paid in the preceding three calendar years plus the amount of the dividends or credits are equal to the required direct services reimbursement level pursuant to Subsection A dof HCEDCºC.this section for group health coverage and blanket health coverage or the required direct services reimbursement level pursuant to Subsection B of this section for individually underwritten health policies, contracts or plans for the preceding three calendar years.

ForIf exceptedthe benefitinsurer healthfails maintenanceto organizationissue contracts, the superintendentdividend shallor establishcredit byin ruleaccordance with the levelrequirements of reimbursementthis forsection, directthe services,superintendent whichshall levelenforce ofthese reimbursementrequirements shalland bemay determinedpursue byany reportsother filedpenalties withas theprovided officeby oflaw, superintendentincluding ofgeneral insurance,penalties aspursuant ato percentSection of59A-1-18 premiums.NMSA 1978.

AD. carrier writing these contracts shall make reimbursement for direct services at a level not less than that level established by the superintendent pursuant to this subsection over the three calendar years preceding the date upon which the rate is established.

NothingAfter innotice thisand subsectionhearing, shallthe besuperintendent construedmay toadopt precludeand apromulgate purchaserreasonable ofrules onenecessary ofand theseproper excepted benefit health maintenance organization contracts from negotiating an agreement with a health insurer that requires a higher amount of premiums paid to becarry usedout forthe reimbursementprovisions of directthis services.»HCEDCsection." [C.]SECTION HCEDCºD.12.

C.»HCEDC A health maintenance organization that fails to comply with the reimbursement requirements pursuant to this section shall issue a dividend or credit against future premiums to all policy or contract holders in an h amount sufficient to [assure ] ensure that the benefits paid in g o t hr the preceding three calendar years plus the amount of the g e i k dividends or credits are equal to the required direct services h r i s reimbursement level pursuant to Subsection A of this section h , t, e u g for group health coverage and blanket health coverage or the e b l e e h required direct services reimbursement level pursuant to n d d i = = o h Subsection B of this section for individually underwritten l ] b ,d i a º e r i = r health policies, contracts or plans for the preceding three t e w d m a n o calendar years.

If the insurer fails to issue the dividend or d m :

b e d s º o t n = .213296.3 s k m e - 27 - e a n e d r e l u [ A d HHHC/HB 285 credit in accordance with the requirements of this section, the superintendent shall enforce these requirements and may pursue any other penalties as provided by law, including general penalties pursuant to Section 59A-1-18 NMSA 1978.

[D.

] HCEDCºE.

D.»HCEDC After notice and hearing, the superintendent may adopt and promulgate reasonable rules necessary and proper to carry out the provisions of this section.

[E.

For the purposes of this section:

(1) "direct services" means services rendered to an individual by a health maintenance organization or a health care practitioner, facility or other provider, including case management, disease management, health education and promotion, preventive services, quality incentive payments to providers and any portion of an assessment that covers services rather than administration and for which an insurer does not h receive a tax credit pursuant to the Medical Insurance Pool Act u » r or the Health Insurance Alliance Act;

provided, however, that t h g e "direct services" does not include care coordination, l i h r i s utilization review or management or any other activity designed h , e h to manage utilization or services;

t u g e b l (2) "health maintenance organization" means e e , gh n d d i = = o h any person who undertakes to provide or arrange for the l ] b ,d i a º r delivery of basic health care services to enrollees on a e r = t e w d prepaid basis, except for enrollee responsibility for m a n o d m :

b r e t º o t n = .213296.3 s k m e - 28 - e a n e d r e l u [ A d copayments or deductibles, but does not include a person that only issues a limited-benefit policy or contract intended to supplement major medical coverage, including medicare supplement, vision, dental, disease-specific, accident-only or hospital indemnity-only insurance policies, or that only issues policies for long-term care or disability income;

and (3) "premium" means all income received from individuals and private and public payers or sources for the procurement of health coverage, including capitated payments, self-funded administrative fees, self-funded claim reimbursements, recoveries from third parties or other insurers and interests less any premium tax paid pursuant to Section 59A-6-2 NMSA 1978 and fees associated with participating in a health insurance exchange that serves as a clearinghouse for insurance.]" SECTION 12.

HEALTH MAINTENANCE ORGANIZATIONS--DIRECT h SERVICES.-- uHHHC/HB »285/a rPage 27 A.

A health maintenance organization shall make t h g e reimbursement for direct services at a level not less than l i h r i s eighty-five percent of premiums across all health product h , e h lines, [except ] including short-term contracts and excluding t u g e b l individually underwritten health insurance policies, contracts e e , gh n d d i = = o h or plans, that are governed by the provisions of Chapter 59A, l ] b ,d i a º r Article 22 NMSA 1978, the Health Maintenance Organization Law e r = t e w d and the Nonprofit Health Care Plan Law, and an excepted benefit mhealth maintenance organization contract intended to supplement major medical coverage, including medicare supplement, vision, dental, disease-specific, accident-only or hospital indemnity-only insurance contracts, or a ncarrier othat donly missues :contracts for long-term care or disability income.

b r e t º o t n = .213296.3 s k m e - 29 - e a n e d r e l u [ A d HHHC/HB 285 health maintenance organization contract intended to supplement major medical coverage, including medicare supplement, vision, dental, disease-specific, accident-only or hospital indemnity- only insurance contracts, or a carrier that only issues contracts for long-term care or disability income.

For individually underwritten health care policies, plans or contracts, the superintendent shall h establish, after notice and informal hearing, the level of uHHHC/HB »285/a rPage 28 reimbursement for direct services, as determined by the reports t h g e filed with the office of superintendent of insurance, as a l i h r i s percent of premiums.

Additional informal hearings may be held h , e h at the superintendent's discretion.

In establishing the level t u g e b l of reimbursement for direct services, the superintendent shall e e , gh n d d i = = o h consider the costs associated with the individual marketing and l ] b ,d i a º r medical underwriting of these policies, plans or contracts at a e r = t e w d level not less than seventy-five percent of premiums.

A health minsurer or health maintenance organization writing these policies, plans or contracts shall make reimbursement for direct services at a nlevel onot dless mthan :that level established by the superintendent pursuant to this subsection over the three calendar years preceding the date upon which that rate is established, but not earlier than calendar year 2010.

b r e t º o t n = .213296.3 s k m e - 30 - e a n e d r e l u [ A d insurer or health maintenance organization writing these policies, plans or contracts shall make reimbursement for direct services at a level not less than that level established by the superintendent pursuant to this subsection over the three calendar years preceding the date upon which that rate is established, but not earlier than calendar year 2010.

HCEDCº C.

ForA excepted benefit health maintenance organization contracts,that fails to comply with the superintendentreimbursement requirements pursuant to this section shall establishissue bya ruledividend or credit against future premiums to all policy or contract holders in an amount HHHC/HB 285/a Page 29 sufficient to ensure that the levelbenefits paid in the preceding three calendar years plus the amount of reimbursementthe fordividends or credits are equal to the required direct services,services whichreimbursement level pursuant to Subsection A of reimbursementthis shallsection befor determinedgroup byhealth reportscoverage filedand withblanket health coverage or the officerequired ofdirect superintendentservices ofreimbursement insurance,level aspursuant ato percentSubsection B of premiums.this section for individually underwritten health policies, contracts or plans for the preceding three calendar years.

A carrier writing these contracts shall make reimbursement for direct services at a level not less than that level established by the superintendent pursuant to this h subsection over the three calendar years preceding the date g o t hr upon which the rate is established.

Nothing in this subsection g e i k shall be construed to preclude a purchaser of one of these h r i s excepted benefit health maintenance organization contracts from h , t, e u g negotiating an agreement with a health insurer that requires a e b l e e h higher amount of premiums paid to be used for reimbursement of n d d i = = o h direct services.»HCEDC l ] b ,d i a º e [C.] HCEDCºD.

C.»HCEDC A health maintenance organization r i = r t e w d m a n o that fails to comply with the reimbursement requirements d m :

b e d s º o t n = .213296.3 s k m e - 31 - e a n e d r e l u [ A d HHHC/HB 285 pursuant to this section shall issue a dividend or credit against future premiums to all policy or contract holders in an amount sufficient to [assure ] ensure that the benefits paid in the preceding three calendar years plus the amount of the dividends or credits are equal to the required direct services reimbursement level pursuant to Subsection A of this section for group health coverage and blanket health coverage or the required direct services reimbursement level pursuant to Subsection B of this section for individually underwritten health policies, contracts or plans for the preceding three calendar years.

[D.D.

]After HCEDCºE.notice and hearing, the superintendent may adopt and promulgate reasonable rules necessary and proper to carry out the provisions of this section." SECTION 13.

D.»HCEDCSection After59A-47-3 noticeNMSA and1978 hearing,(being theLaws h1984, superintendentChapter may127, adoptSection and879.1, promulgateas reasonableamended) rulesis uamended » r necessary and proper to carryread: out the provisions of this t h g e section.

l"59A-47-3. i h r i s [E.

ForDEFINITIONS.--As theused purposesin ofChapter this59A, section:Article 47 NMSA 1978:

h , e h (1) "direct services" means services rendered t u g e b l to an individual by a health maintenance organization or a e e , gh n d d i = = o h health care practitioner, facility or other provider, including l ] b ,d i a º r case management, disease management, health education and e r = t e w d promotion, preventive services, quality incentive payments to m a n o d m :

b r e t º o t n = .213296.3 s k m e - 32 - e a n e d r e l u [ A d providers and any portion of an assessment that covers services rather than administration and for which an insurer does not receive a tax credit pursuant to the Medical Insurance Pool Act;

provided, however, that "direct services" does not include care coordination, utilization review or management or any other activity designed to manage utilization or services;

(2) "health maintenance organization" means any person who undertakes to provide or arrange for the delivery of basic health care services to enrollees on a prepaid basis, except for enrollee responsibility for copayments or deductibles, but does not include a person that only issues a limited-benefit policy or contract intended to supplement major medical coverage, including medicare supplement, vision, dental, disease-specific, accident-only or hospital indemnity-only insurance policies, or that only issues policies for long-term care or disability income;

and (3) "premium" means all income received from individuals and private and public payers or sources for the procurement of health coverage, including capitated payments, h self-funded administrative fees, self-funded claim u » r reimbursements, recoveries from third parties or other insurers t h g e and interests less any tax paid pursuant to the Insurance l i h r i s Premium Tax Act and fees associated with participating in a h , e h health insurance exchange that serves as a clearinghouse for t u g e b l insurance.]" e e , gh n d d i = = o h SECTION 13.

Section 59A-47-3 NMSA 1978 (being Laws 1984, l ] b ,d i a º r Chapter 127, Section 879.1, as amended) is amended to read:

e r = t e w d "59A-47-3.

DEFINITIONS.--As used in Chapter 59A, Article m a n o d m :

b r e t º o t n = .213296.3 s k m e - 33 - e a n e d r e l u [ A d HHHC/HB 285 NMSA 1978:

HHHC/HB 285/a Page 30 B.

"credentialing" means the process of obtaining h and verifying information about a provider and evaluating that u » r provider when that provider seeks to become a participating t h g e provider;

l i h r i s F.

"direct services" means services rendered to an h , e h individual by a health care plan, health insurer or a health t u g e b l care practitioner, facility or other provider, including case e e , gh n d d i = = o h management, disease management, health education and promotion, l ] b ,d i a º r preventive services, quality incentive payments to providers e r = t e w d and any portion of an assessment that covers services rather mthan administration and for which a nhealth ocare dplan mor :a health insurer does not receive a tax credit pursuant to the Medical Insurance Pool Act;

bprovided, rhowever, ethat t"direct ºservices" odoes tnot ninclude =care .213296.3HHHC/HB s285/a kPage m31 ecoordination, -utilization 34review -or emanagement a n e d r e l u [ A d than administration and for which a health care plan or aany healthother insureractivity doesdesigned not receive a tax credit pursuant to themanage Medicalutilization Insuranceor Poolservices; Act;

provided, however, that "direct services" does not include care coordination, utilization review or management or any other activity designed to manage utilization or services;

[A.] H.

h (1) a short-term health care plan;

g o (2) an excepted benefit health care plan t hr g e i k intended to supplement major medical coverage, including h r i s medicare supplement, vision, dental, disease-specific, h , t, accident-only or hospital indemnity-only insurance policies;

or e u g e b l (3) a policy or plan for long-term care or e e h n d d i = = o h disability income;

l ] b ,d i a º e K.

"indemnity benefit" means a payment that the r i = r t e w d purveyor has not agreed to accept as payment in full for healthHHHC/HB m285/a aPage n32 ohealth dcare mfurnished :the subscriber;

bL. e d s º o t n = .213296.3 s k m e - 35 - e a n e d r e l u [ A d HHHC/HB 285 care furnished the subscriber;

[B.]"item L.of health care" means a service or material used in health care;

"itemM. of health care" [includes any services or materials] means a service or material used in health care;

[C.

"health care expense payment" means a payment for health care to a purveyor on behalf of a subscriber, or such a payment to the subscriber;] M.

"premium" means all income received from individuals and private and public payers or sources for the procurement of health coverage, including capitated payments, self-funded administrative fees, self-funded claim h reimbursements, recoveries from third parties or other insurers u » r and interests less any premium tax paid pursuant to Section t h g e 59A-6-2 NMSA 1978 and fees associated with participating in a l i h r i s health insurance exchange that serves as a clearinghouse for h , e h insurance;

t u g e b l P.

"provider" means a physician or other individual e e , gh n d d i = = o h licensed or otherwise authorized to furnish health care l ] b ,d i a º r services in the state;

e r = t e w d [D.] Q.

"purveyor" means a person who furnishes any mitem aof nhealth ocare dand mcharges :for that item;

bR. r e t º o t n = .213296.3 s k m e - 36 - e a n e d r e l u [ A d item of health care and charges for that item;

[E.

] R.

[F.HHHC/HB 285/a Page 33 S.

"indemnity benefit" means a payment that the purveyor has not agreed to accept as payment in full for health care furnished the subscriber;] S.

"solicitor" means a person employed by the h licensed agent of a health care plan for the purpose of g o soliciting health care policies and other related duties in t hr g e i k connection with the handling of the business of the agent as h r i s may be authorized and paid for the person's services either on h , t, a commission basis or salary basis or part by commission and e u g e b l part by salary;

e e h n d d i = = o h [G.] U.

"subscriber" means any individual who, l ] b ,d i a º e because of a contract with a health care plan entered into by r i = r t e w d or for the individual, is entitled to have health care expense mpayments amade non othe dindividual's mbehalf :or to the individual by the health care plan;

band eV. d s º o t n = .213296.3 s k m e - 37 - e a n e d r e l u [ A d HHHC/HB 285 payments made on the individual's behalf or to the individual by the health care plan;

"underwriting manual" means the health care plan's written criteria, approved by the superintendent, that HHHC/HB 285/a Page 34 defines the terms and [H.]conditions V.under which subscribers may be selected.

"underwriting manual" means the health care plan's written criteria, approved by the superintendent, that defines the terms and conditions under which subscribers may be selected.

If the superintendent fails to act within such period, the filing shall be deemed to be approved.approved." SECTION 14.

[I.

"acquisition expenses" includes all expenses incurred in connection with the solicitation and enrollment of h subscribers;

u » r J.

"administration expenses" means all expenses of t h g e the health care plan other than the cost of health care expense l i h r i s payments and acquisition expenses;

h , e h K.

"health care plan" means a nonprofit corporation t u g e b l authorized by the superintendent to enter into contracts with e e , gh n d d i = = o h subscribers and to make health care expense payments;

l ] b ,d i a º r L.

"agent" means a person appointed by a health e r = t e w d care plan authorized to transact business in this state to act m a n o d m :

b r e t º o t n = .213296.3 s k m e - 38 - e a n e d r e l u [ A d as its representative in any given locality for soliciting health care policies and other related duties as may be authorized;

M.

"solicitor" means a person employed by the licensed agent of a health care plan for the purpose of soliciting health care policies and other related duties in connection with the handling of the business of the agent as may be authorized and paid for the person's services either on a commission basis or salary basis or part by commission and part by salary;

N.

"chiropractor" means any person holding a license provided for in the Chiropractic Physician Practice Act;

O.

"doctor of oriental medicine" means any person licensed as a doctor of oriental medicine under the Acupuncture and Oriental Medicine Practice Act;

P.

"pharmacist" means a person licensed as a pharmacist pursuant to the Pharmacy Act;

Q.

"pharmacist clinician" means a pharmacist who h exercises prescriptive authority pursuant to the Pharmacist g o Prescriptive Authority Act;

t hr g e i k R.

"credentialing" means the process of obtaining h r i s and verifying information about a provider and evaluating that h , t, provider when that provider seeks to become a participating e u g e b l provider;

and e e h n d d i = = o h S.

"provider" means a physician or other individual l ] b ,d i a º e licensed or otherwise authorized to furnish health care r i = r t e w d services in the state.]" m a n o d m :

b e d s º o t n = .213296.3 s k m e - 39 - e a n e d r e l u [ A d HHHC/HB 285 SECTION 14.

DEFINITIONS.--As used in Chapter 59A, Article 47 NMSA 1978:

"agent" means a person appointed by a health care plan authorized to transact business in this state to HHHC/HB 285/a Page 35 act as its representative in any given locality for soliciting health care policies and other related duties as may be authorized;

h D.

"chiropractor" means any person holding a g o license provided for in the Chiropractic Physician Practice t hr g e i k Act;

h r i s E.

"credentialing" means the process of obtaining h , t, and verifying information about a provider and evaluating that e u g e b l e e h provider when that provider seeks to become a participating n d d i = = o h provider;

l ] b ,d i a º e F.

"direct services" means services rendered to an rindividual iby =a rhealth tcare eplan, whealth dinsurer mor a nhealth ocare individualpractitioner, byfacility or other provider, including case management, disease management, health education and promotion, preventive services, quality incentive payments to providers and any portion of an assessment that covers services rather than administration and for which a health care plan,plan or a health insurer ordoes not receive a healthtax dcredit mpursuant :to the Medical Insurance Pool Act;

b e d s º o t n = .213296.3 s k m e - 40 - e a n e d r e l u [ A d care practitioner, facility or other provider, including case management, disease management, health education and promotion, preventive services, quality incentive payments to providers and any portion of an assessment that covers services rather than administration and for which a health care plan or a health insurer does not receive a tax credit pursuant to the Medical Insurance Pool Act;

[A.]HHHC/HB 285/a Page 36 H.

[B.I.

"item"health ofcare expense payment" means a payment for health care"care includesto anya servicespurveyor on behalf of a subscriber, or materialssuch useda inpayment healthto care;the subscriber;

C.]J. I.

"health care expenseplan" payment" means aan horganization paymentthat fordemonstrates healthto carethe tosuperintendent athat purveyorit onhas behalfbeen granted exemption from the federal income tax by the United States commissioner of ainternal urevenue »as ran subscriber,organization described in Section 501(c)(3) of the United States Internal Revenue Code of 1986, as that section may be amended or suchrenumbered, aand paymentis toauthorized by the subscriber;superintendent to enter into contracts with subscribers and to make health care expense payments, including an organization that issues:

t h g e J.

"health care plan" means an organization that l i h r i s demonstrates to the superintendent that it has been granted h , e h exemption from the federal income tax by the United States t u g e b l commissioner of internal revenue as an organization described e e , gh n d d i = = o h in Section 501(c)(3) of the United States Internal Revenue Code l ] b ,d i a º r of 1986, as that section may be amended or renumbered, and is e r = t e w d authorized by the superintendent to enter into contracts with m a n o d m :

b r e t º o t n = .213296.3 s k m e - 41 - e a n e d r e l u [ A d HHHC/HB 285 subscribers and to make health care expense payments, including an organization that issues:

"indemnity benefit" means a payment that the purveyor has not agreed to accept as payment in full for HHHC/HB 285/a Page 37 health care furnished the subscriber;

h N.

"pharmacist clinician" means a pharmacist who g o exercises prescriptive authority pursuant to the Pharmacist t hr g e i k Prescriptive Authority Act;

h r i s O.

"premium" means all income received from h , t, individuals and private and public payers or sources for the e u g e b l e e h procurement of health coverage, including capitated payments, n d d i = = o h self-funded administrative fees, self-funded claim l ] b ,d i a º e reimbursements, recoveries from third parties or other insurers r i = r t e w d and interests less any premium tax paid pursuant to Section m59A-6-2 NMSA 1978 and fees associated with participating in a nhealth oinsurance dexchange mthat :serves as a clearinghouse for insurance;

b e d s º o t n = .213296.3 s k m e - 42 - e a n e d r e l u [ A d 59A-6-2 NMSA 1978 and fees associated with participating in a health insurance exchange that serves as a clearinghouse for insurance;

D.] Q.

[E.R.

] R.

[F.HHHC/HB 285/a Page 38 S.

"indemnity benefit" means a payment that the purveyor has not agreed to accept as payment in full for health care furnished the subscriber;] S.

h and g o (2) is issued only to individuals who have not t hr g e i k been enrolled in a health care plan that provides the same or h r i s similar nonrenewable coverage from any nonprofit health care h , t, plan within the three months preceding enrollment in the e u g e b l short-term plan;

e e h n d d i = = o h T.

"solicitor" means a person employed by the l ] b ,d i a º e licensed agent of a health care plan for the purpose of r i = r t e w d soliciting health care policies and other related duties in mconnection with the handling of the business of the agent as may be authorized and paid for the person's services either on a ncommission obasis dor msalary :basis or part by commission and part by salary;

bU. e d s º o t n = .213296.3 s k m e - 43 - e a n e d r e l u [ A d HHHC/HB 285 connection with the handling of the business of the agent as may be authorized and paid for the person's services either on a commission basis or salary basis or part by commission and part by salary;

[G.] U.

and [H.] V.

"underwriting manual" means the health care plan's written criteria, approved by the superintendent, that HHHC/HB 285/a Page 39 defines the terms and conditions under which subscribers may be selected.

The superintendent shall notify the health care plan filing the underwriting manual or the amendment h thereto of the superintendent's approval or disapproval thereof u » r in writing within thirty days after filing or within sixty days t h g e after filing if the superintendent shall so extend the time.

l i h r i s If the superintendent fails to act within such period, the h , e h filing shall be deemed to be approved.approved." SECTION 15.

t u g e b l [I.

"acquisition expenses" includes all expenses e e , gh n d d i = = o h incurred in connection with the solicitation and enrollment of l ] b ,d i a º r subscribers;

e r = t e w d J.

"administration expenses" means all expenses of m a n o d m :

b r e t º o t n = .213296.3 s k m e - 44 - e a n e d r e l u [ A d the health care plan other than the cost of health care expense payments and acquisition expenses;

K.

"health care plan" means an organization that demonstrates to the superintendent that it has been granted exemption from the federal income tax by the United States commissioner of internal revenue as an organization described in Section 501(c)(3) of the United States Internal Revenue Code of 1986, as that section may be amended or renumbered, and is authorized by the superintendent to enter into contracts with subscribers and to make health care expense payments;

L.

"agent" means a person appointed by a health care plan authorized to transact business in this state to act as its representative in any given locality for soliciting health care policies and other related duties as may be authorized;

M.

"solicitor" means a person employed by the licensed agent of a health care plan for the purpose of soliciting health care policies and other related duties in connection with the handling of the business of the agent as h may be authorized and paid for the person's services either on u » r a commission basis or salary basis or part by commission and t h g e part by salary;

l i h r i s N.

"chiropractor" means any person holding a h , e h license provided for in the Chiropractic Physician Practice t u g e b l Act;

e e , gh n d d i = = o h O.

"doctor of oriental medicine" means any person l ] b ,d i a º r licensed as a doctor of oriental medicine under the Acupuncture e r = t e w d and Oriental Medicine Practice Act;

m a n o d m :

b r e t º o t n = .213296.3 s k m e - 45 - e a n e d r e l u [ A d HHHC/HB 285 P.

"pharmacist" means a person licensed as a pharmacist pursuant to the Pharmacy Act;

Q.

"pharmacist clinician" means a pharmacist who exercises prescriptive authority pursuant to the Pharmacist Prescriptive Authority Act;

R.

"credentialing" means the process of obtaining and verifying information about a provider and evaluating that provider when that provider seeks to become a participating provider;

and S.

"provider" means a physician or other individual licensed or otherwise authorized to furnish health care services in the state.]" SECTION 15.

A health care plan shall make reimbursement for h direct services at a level not less than eighty-five percent of g o premiums across all health product lines, [except ] including tshort- hrterm g e i k short-term health care plans and excluding individually h r i s underwritten health care policies, contracts or plans, that are h , t, governed by the provisions of Chapter 59A, Article 22 NMSA e u g e b l e e h 1978, the Health Maintenance Organization Law and the Nonprofit n d d i = = o h Health Care Plan Law, and an excepted benefit health care plan l ] b ,d i a º e intended to supplement major medical coverage, including rmedicare isupplement, =vision, rdental, tdisease-specific, eaccident-only wor dhospital mindemnity-only HHHC/HB 285/a Page 40 insurance policies, or a nhealth ocare medicareplan supplement,that vision,only dental,issues disease-specific,policies dfor mlong-term :care or disability income.

b e d s º o t n = .213296.3 s k m e - 46 - e a n e d r e l u [ A d accident-only or hospital indemnity-only insurance policies, or a health care plan that only issues policies for long-term care or disability income.

In establishing the level of reimbursement for direct services, the superintendent shall consider the costs associated with the individual marketing and h medical underwriting of these policies, plans or contracts at a g o level not less than seventy-five percent of premiums.

A health t hr g e i k insurer writing these policies, plans or contracts shall make h r i s reimbursement for direct services at a level not less than that h , t, level established by the superintendent pursuant to this e u g e b l subsection over the three HHHC/HB 285/a Page 41 calendar years preceding the date e e h n d d i = = o h upon which that rate is established, but not earlier than l ] b ,d i a º e calendar year 2010.

Nothing in this subsection shall be r i = r t e w d construed to preclude a purchaser of one of these policies, mplans or contracts from negotiating an agreement with a nhealth oinsurer dthat mrequires :a higher amount of premiums paid to be used for reimbursement for direct services.

bC. e d s º o t n = .213296.3 s k m e - 47 - e a n e d r e l u [ A d HHHC/HB 285 plans or contracts from negotiating an agreement with a health insurer that requires a higher amount of premiums paid to be used for reimbursement for direct services.

HCEDCºA C.health care plan that fails to comply with the reimbursement requirements pursuant to this section shall issue a dividend or credit against future premiums to all policyholders in an amount sufficient to ensure that the benefits paid in the preceding three calendar years plus the amount of the dividends or credits are equal to the required direct services reimbursement level pursuant to Subsection A of this section for group health coverage and blanket health coverage or the required direct services reimbursement level pursuant to Subsection B of this section for individually underwritten health policies, contracts or plans for the preceding three calendar years.

For an excepted benefit health care plan, the superintendent shall establish by rule the level of reimbursement for direct services, which level of reimbursement shall be determined by reports filed with the office of superintendent of insurance, as a percent of premiums.

A health care plan writing these excepted benefit health care plans shall make reimbursement for direct services at a level not less than that level established by the superintendent pursuant to this subsection over the three calendar years preceding the date upon which the rate is established.

Nothing in this subsection shall be construed to preclude a purchaser of one of these excepted benefit health care plans from negotiating an agreement with a nonprofit health care plan that h requires a higher amount of premiums paid to be used for u » r t h reimbursement of direct services.»HCEDC g e l i [C.] HCEDCºD.

C.»HCEDC A health care plan that fails to h r i s comply with the reimbursement requirements pursuant to this h , e h t u g section shall issue a dividend or credit against future e b l e e , gh premiums to all policyholders in an amount sufficient to n d d i = = o h [assure ] ensure that the benefits paid in the preceding three l ] b ,d i a º r calendar years plus the amount of the dividends or credits are e r = t e w d m a n o equal to the required direct services reimbursement level d m :

b r e t º o t n = .213296.3 s k m e - 48 - e a n e d r e l u [ A d pursuant to Subsection A of this section for group health coverage and blanket health coverage or the required direct services reimbursement level pursuant to Subsection B of this section for individually underwritten health policies, contracts or plans for the preceding three calendar years.

[D.D.

]After HCEDCºE.notice and hearing, the superintendent HHHC/HB 285/a Page 42 may adopt and promulgate reasonable rules necessary and proper to carry out the provisions of this section." SECTION 16.

D.»HCEDCThat Afterversion noticeof andSection hearing,59A-47-46 theNMSA superintendent1978 may(being adoptLaws and2010, promulgateChapter reasonable94, rulesSection necessary4, andas properamended) that is to carrybecome outeffective theJanuary provisions1, of2020 thisis section.amended to read:

[E."59A-47-46.

ForHEALTH theINSURERS--DIRECT purposesSERVICES.-- ofA. this section:

(1)A "directhealth services"care meansplan servicesshall renderedmake toreimbursement anfor individualdirect byservices at a healthlevel carenot plan,less healththan insurereighty-five orpercent aof healthpremiums careacross practitioner,all facilityhealth orproduct otherlines, provider, including caseshort- management,term disease management, health educationcare plans and hexcluding promotion,individually preventiveunderwritten services,health qualitycare incentivepolicies, paymentscontracts toor gplans, othat providersare andgoverned anyby portionthe provisions of anChapter assessment59A, thatArticle covers22 servicesNMSA t1978, hrthe gHealth eMaintenance iOrganization kLaw ratherand thanthe administrationNonprofit Health Care Plan Law, and foran whichexcepted abenefit health care plan orintended hto rsupplement imajor smedical acoverage, healthincluding insurermedicare doessupplement, notvision, receivedental, adisease-specific, taxaccident-only creditor pursuanthospital toindemnity-only theinsurance hpolicies, ,or t,a Medicalhealth Insurancecare Poolplan Actthat oronly theissues Healthpolicies Insurancefor Alliancelong-term ecare uor gdisability eincome. b l Act;

provided, however, that "direct services" does not include e e h n d d i = = o h care coordination, utilization review or management or any l ] b ,d i a º e other activity designed to manage utilization or services;

r i = r t e w d (2) "health care plan" means a nonprofit m a n o d m :

b e d s º o t n = .213296.3 s k m e - 49 - e a n e d r e l u [ A d HHHC/HB 285 corporation authorized by the superintendent to enter into contracts with subscribers and to make health care expense payments, but does not include a person that only issues a limited-benefit policy intended to supplement major medical coverage, including medicare supplement, vision, dental, disease-specific, accident-only or hospital indemnity-only insurance policies, or that only issues policies for long-term care or disability income;

and (3) "premium" means all income received from individuals and private and public payers or sources for the procurement of health coverage, including capitated payments, self-funded administrative fees, self-funded claim reimbursements, recoveries from third parties or other insurers and interests less any premium tax paid pursuant to Section 59A-6-2 NMSA 1978 and fees associated with participating in a health insurance exchange that serves as a clearinghouse for h insurance.]" u » r SECTION 16.

That version of Section 59A-47-46 NMSA 1978 t h g e (being Laws 2010, Chapter 94, Section 4, as amended) that is to l i h r i s become effective January 1, 2020 is amended to read:

h , e h "59A-47-46.

HEALTH INSURERS--DIRECT SERVICES.-- t u g e b l A.

A health care plan shall make reimbursement for e e , gh n d d i = = o h direct services at a level not less than eighty-five percent of l ] b ,d i a º r premiums across all health product lines, [except ] including e r = t e w d short-term health care plans and excluding individually m a n o d m :

b r e t º o t n = .213296.3 s k m e - 50 - e a n e d r e l u [ A d underwritten health care policies, contracts or plans, that are governed by the provisions of Chapter 59A, Article 22 NMSA 1978, the Health Maintenance Organization Law and the Nonprofit Health Care Plan Law, and an excepted benefit health care plan intended to supplement major medical coverage, including medicare supplement, vision, dental, disease-specific, accident-only or hospital indemnity-only insurance policies, or a health care plan that only issues policies for long-term care or disability income.

Nothing in this subsection shall be construed to preclude a purchaser from negotiating an agreement with a health insurer that requires HHHC/HB 285/a Page 43 a higher amount of premiums paid to be used for reimbursement for direct services for one or more products or for one or more years.

For individually underwritten health care policies, plans or contracts, the superintendent shall h establish, after notice and informal hearing, the level of g o reimbursement for direct services as determined as a percent of t hr g e i k premiums.

Additional hearings may be held at the h r i s superintendent's discretion.

In establishing the level of h , t, reimbursement for direct services, the superintendent shall e u g e b l consider the costs associated with the individual marketing and e e h n d d i = = o h medical underwriting of these policies, plans or contracts at a l ] b ,d i a º e level not less than seventy-five percent of premiums.

A health r i = r t e w d insurer writing these policies, plans or contracts shall make mreimbursement for direct services at a nlevel onot dless mthan :that level established by the superintendent pursuant to this subsection over the three calendar years preceding the date upon which that rate is established, but not earlier than calendar year 2010.

b e d s º o t n = .213296.3 s k m e - 51 - e a n e d r e l u [ A d HHHC/HB 285 reimbursement for direct services at a level not less than that level established by the superintendent pursuant to this subsection over the three calendar years preceding the date upon which that rate is established, but not earlier than calendar year 2010.

HCEDCº C.

ForA anhealth exceptedcare benefitplan healththat carefails plan,to comply with HHHC/HB 285/a Page 44 the superintendentreimbursement requirements pursuant to this section shall establishissue bya ruledividend or credit against future premiums to all policyholders in an amount sufficient to ensure that the levelbenefits paid in the preceding three calendar years plus the amount of reimbursementthe fordividends or credits are equal to the required direct services,services whichreimbursement level pursuant to Subsection A of reimbursementthis shallsection befor determinedgroup byhealth reportscoverage filedand withblanket health coverage or the officerequired ofdirect superintendentservices ofreimbursement insurance,level aspursuant ato percentSubsection B of premiums.this section for individually underwritten health policies, contracts or plans for the preceding three calendar years.

A health care plan writing these excepted benefit health care plans shall make reimbursement for direct services at a level h not less than that level established by the superintendent u » r pursuant to this subsection over the three calendar years t h g e l i preceding the date upon which the rate is established.

Nothing h r i s in this subsection shall be construed to preclude a purchaser h , e h of one of these excepted benefit health care plans from t u g e b l e e , gh negotiating an agreement with a nonprofit health care plan that n d d i = = o h requires a higher amount of premiums paid to be used for l ] b ,d i a º r reimbursement of direct services.»HCEDC e r = t e w d m a n o [C.] HCEDCºD.

C.»HCEDC A health care plan that fails to d m :

b r e t º o t n = .213296.3 s k m e - 52 - e a n e d r e l u [ A d comply with the reimbursement requirements pursuant to this section shall issue a dividend or credit against future premiums to all policyholders in an amount sufficient to [assure ] ensure that the benefits paid in the preceding three calendar years plus the amount of the dividends or credits are equal to the required direct services reimbursement level pursuant to Subsection A of this section for group health coverage and blanket health coverage or the required direct services reimbursement level pursuant to Subsection B of this section for individually underwritten health policies, contracts or plans for the preceding three calendar years.

[D.D.

]After HCEDCºE.notice and hearing, the superintendent may adopt and promulgate reasonable rules necessary and proper to carry out the provisions of this section.” HHHC/HB 285/a Page 45 25

D.»HCEDC After notice and hearing, the superintendent may adopt and promulgate reasonable rules necessary and proper to carry out the provisions of this h section.

g o [E.

For the purposes of this section:

t hr g e i k (1) "direct services" means services rendered h r i s to an individual by a health care plan, health insurer or a h , t, health care practitioner, facility or other provider, including e u g e b l case management, disease management, health education and e e h n d d i = = o h promotion, preventive services, quality incentive payments to l ] b ,d i a º e providers and any portion of an assessment that covers services r i = r t e w d rather than administration and for which a health care plan or m a n o d m :

b e d s º o t n = .213296.3 s k m e - 53 - e a n e d r e l u [ A d HHHC/HB 285 a health insurer does not receive a tax credit pursuant to the Medical Insurance Pool Act;

provided, however, that "direct services" does not include care coordination, utilization review or management or any other activity designed to manage utilization or services;

(2) "health care plan" means a nonprofit corporation authorized by the superintendent to enter into contracts with subscribers and to make health care expense payments, but does not include a person that only issues a limited-benefit policy intended to supplement major medical coverage, including medicare supplement, vision, dental, disease-specific, accident-only or hospital indemnity-only insurance policies, or that only issues policies for long-term care or disability income;

and (3) "premium" means all income received from individuals and private and public payers or sources for the h procurement of health coverage, including capitated payments, u » r self-funded administrative fees, self-funded claim t h g e reimbursements, recoveries from third parties or other insurers l i h r i s and interests less any tax paid pursuant to the Insurance h , e h Premium Tax Act and fees associated with participating in a t u g e b l health insurance exchange that serves as a clearinghouse for e e , gh n d d i = = o h insurance.]" l ] b ,d i a º r - 54 - e r = t e w d m a n o d m :

b r e t º o t n = .213296.3 s k m e e a n e d r e l u [ A d