SENATE DOCKET, NO. 2233        FILED ON: 1/22/2019

SENATE  .  .  .  .  .  .  .  .  .  .  .  .  .  .  No. 2217

The Commonwealth of Massachusetts

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PRESENTED BY:

Sal N. DiDomenico

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To the Honorable Senate and House of Representatives of the Commonwealth of Massachusetts in General
Court assembled:

The undersigned legislators and/or citizens respectfully petition for the adoption of the accompanying bill:

An Act furthering rate equity, access, and affordability in community hospitals.

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PETITION OF:

SENATE DOCKET, NO. 2233        FILED ON: 1/22/2019

SENATE  .  .  .  .  .  .  .  .  .  .  .  .  .  .  No. 2217

The Commonwealth of Massachusetts

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In the One Hundred and Ninety-First General Court
(2019-2020)

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An Act furthering rate equity, access, and affordability in community hospitals.

Be it enacted by the Senate and House of Representatives in General Court assembled, and by the authority of the same, as follows:
 

SECTION 1. Chapter 176J of the General Laws is hereby amended in section 6 in subsection (c), as so appearing, by adding at the end thereof the following:-

The subscriber contracts, rates and evidence of coverage for health benefit plans shall be subject to the disapproval of the commissioner of insurance.  To address commercial insurance price variation for underpaid acute hospitals and to promote access to high value acute hospital care in the Commonwealth, for all commercial insured health benefit plan rates effective for rate years on and after January 1, 2020, the carrier's health benefit plan rates filed with the division of insurance are considered presumptively disapproved if the carrier's network provider reimbursement rates, inclusive of rates and targets within alternative payment contracts, do not reimburse acute hospitals at or greater than a minimum of 90 percent of the carrier’s statewide average commercial relative price calculated separately for acute hospital inpatient and outpatient services in accordance with requirements established by the division of insurance, based on the most recent relative price analysis by the center for health information and analysis.  Carriers shall annually certify and provide hospital-specific evidence to the division of insurance that each acute hospital’s rates meet a minimum threshold of the carrier’s 90 percent of the statewide average commercial relative price individually calculated for inpatient and outpatient services.

SECTION 2.   Chapter 176A of the General Laws is hereby amended in section 6, as so appearing, by adding the following after the word “discriminatory”:-

The subscriber contracts, rates and evidence of coverage for health benefit plans shall be subject to the disapproval of the commissioner of insurance.  To address commercial insurance price variation for underpaid acute hospitals and to promote access to high value acute hospital care in the Commonwealth, for all commercial insured health benefit plan rates effective for rate years on and after January 1, 2020, the carrier's health benefit plan rates filed with the division of insurance are considered presumptively disapproved if the carrier's network provider reimbursement rates, inclusive of rates and targets within alternative payment contracts, do not reimburse acute hospitals at or greater than a minimum of 90 percent of the carrier’s statewide average commercial relative price calculated separately for acute hospital inpatient and outpatient services in accordance with requirements established by the division of insurance, based on the most recent relative price analysis by the center for health information and analysis.  Carriers shall annually certify and provide hospital-specific evidence to the division of insurance that each acute hospital’s rates meet a minimum threshold of the carrier’s 90 percent of the statewide average commercial relative price individually calculated for inpatient and outpatient services.

SECTION 3.   Chapter 176B of the General Laws is hereby amended in section 4, as so appearing, by inserting the following after the word “discriminatory”:-

The subscriber contracts, rates and evidence of coverage for health benefit plans shall be subject to the disapproval of the commissioner of insurance.  To address commercial insurance price variation for underpaid acute hospitals and to promote access to high value acute hospital care in the Commonwealth, for all commercial insured health benefit plan rates effective for rate years on and after January 1, 2020, the carrier's health benefit plan rates filed with the division of insurance are considered presumptively disapproved if the carrier's network provider reimbursement rates, inclusive of rates and targets within alternative payment contracts, do not reimburse acute hospitals at or greater than a minimum of 90 percent of the carrier’s statewide average commercial relative price calculated separately for acute hospital inpatient and outpatient services in accordance with requirements established by the division of insurance, based on the most recent relative price analysis by the center for health information and analysis.  Carriers shall annually certify and provide hospital-specific evidence to the division of insurance that each acute hospital’s rates meet a minimum threshold of the carrier’s 90 percent of the statewide average commercial relative price individually calculated for inpatient and outpatient services.

SECTION 4.   Chapter 176G of the General Laws is hereby amended in section 16, as so appearing, by inserting the following after the word “reasonable”:-

To address commercial insurance price variation for underpaid acute hospitals and to promote access to high value acute hospital care in the Commonwealth, for all commercial insured health benefit plan rates effective for rate years on and after January 1, 2020, the carrier's health benefit plan rates filed with the division of insurance are considered presumptively disapproved if the carrier's network provider reimbursement rates, inclusive of rates and targets within alternative payment contracts, do not reimburse acute hospitals at or greater than a minimum of 90 percent of the carrier’s statewide average commercial relative price calculated separately for acute hospital inpatient and outpatient services in accordance with requirements established by the division of insurance, based on the most recent relative price analysis by the center for health information and analysis.  Carriers shall annually certify and provide hospital-specific evidence to the division of insurance that each acute hospital’s rates meet a minimum threshold of the carrier’s 90 percent of the statewide average commercial relative price individually calculated for inpatient and outpatient services.

SECTION 5.   Chapter 175 of the General Laws is hereby amended by adding the following new section:-

Section 229.  Approval of Contracts

The subscriber contracts, rates and evidence of coverage for health benefit plans shall be subject to the disapproval of the commissioner of insurance.  No such contracts shall be approved if the benefits provided therein are unreasonable in relation to the rate charged, or if the rates are excessive, inadequate, or unfairly discriminatory. 

To address commercial insurance price variation for underpaid acute hospitals and to promote access to high value acute hospital care in the Commonwealth, for all commercial insured health benefit plan rates effective for rate years on and after January 1, 2020, the carrier's health benefit plan rates filed with the division of insurance are considered presumptively disapproved if the carrier's network provider reimbursement rates, inclusive of rates and targets within alternative payment contracts, do not reimburse acute hospitals at or greater than a minimum of 90 percent of the carrier’s statewide average commercial relative price calculated separately for acute hospital inpatient and outpatient services in accordance with requirements established by the division of insurance, based on the most recent relative price analysis by the center for health information and analysis.  Carriers shall annually certify and provide hospital-specific evidence to the division of insurance that each acute hospital’s rates meet a minimum threshold of the carrier’s 90 percent of the statewide average commercial relative price individually calculated for inpatient and outpatient services.

SECTION 6. The rules or regulations necessary to carry out this act shall be adopted not later than May 1, 2019 or not later than 90 days after the effective date of this act, whichever is sooner.

SECTION 7. Sections 1, 2, 3, 4, 5 to 6, inclusive, shall take effect immediately upon the effective date of this act.