Senate Committee Substitute

SCS/HCS/HB 818 - This act establishes the Missouri Health Insurance Portability and Accountability Act and changes the laws regarding the Missouri Health Insurance Pool and small employer insurance availability.

ACCESS TO TAX REFUNDS FOR DELINQUENT MEDICAL BILLS - This act establishes a process for hospitals and other health care providers to levy a person’s tax refund or lottery winnings. Under current law, sections 143.782 to 143.788, allow state agencies to submit an agency debt that a person owes to it to the department of revenue in order to set off the debt by the person’s tax refund. Under section 143.790, a hospital or other healthcare provider may submit a claim to the department of health and senior services for any debt over 90 days old that is owed to it by a person who was not covered by health insurance or public aid at the time the health care services were administered. If the department of health determines that the claim is valid, the claim will become a “debt” of the agency for purposes of the act, and the department of health can submit the debt to the department of revenue to set off the person’s tax refund. The act utilizes the current law with respect to providing notice to the debtor and the opportunity to contest the claim. After receiving the funds from the department of revenue, the department of health will settle with the hospital or provider. The hospital or provider will be charged an administrative fee not to exceed 3% of the collected amount. The act also provides that lottery prize payouts are subject to the same procedure (sections 143.782, 143.790, and 313.321);

MISSOURI HEALTH INSURANCE PORTABILITY AND ACCOUNTABILITY ACT - This act amends several provisions of law relating to group health insurance (large and small group market) and individual health insurance. The act (Sections 376.450 to 376.454) attempts to make Missouri "HIPAA compliant" for purposes of federal law. HIPAA is the Health Insurance Portability Accountability Act which, amongst other things, relates to the crediting of prior health coverage for purposes of reducing preexisting condition exclusion periods and determining eligibility.

The new provisions define such terms as "excepted benefits", "pre-existing condition exclusion", "waiting period", and other terms for purposes of the Missouri health insurance portability and accountability act (Section 376.450).

Under the provisions of the act, an insurer may only exclude or limit coverage on persons if the insurer complies with Sections 376.450 to 376.454. Under the act, a health insurance issuer offering group coverage may impose a preexisting condition exclusion only if:

(1) The exclusion relates to a condition for which medical advice, diagnosis, or treatment was recommended or received within the 6 month period ending on the enrollment date;

(2) The exclusion extends for a period no more than 12 months, or 18 months in the case of a late enrollee; and

(3) The period of exclusion is reduced by the aggregate period of creditable coverage.

The act sets forth rules on how to apply creditable coverage. For instance, a period of creditable coverage shall not be counted if, after such period and before the enrollment date, there was a 63-day period in which the individual was not covered by insurance. The act also sets forth rules on how to apply preexisting condition exclusions with respect to adopted children and pregnancies.

The act requires group health insurance issuers to provide certifications of creditable coverage as required by federal law.

The act sets forth rules regarding special enrollment periods in which an employee or a dependent may enroll for coverage under certain conditions. For instance, an employee may enroll for coverage if he or she was covered under another group plan when the coverage was originally offered (Section 376.450.7).

The act allows health management organizations to provide an affiliation period for coverage if no pre-existing condition exclusions are imposed, the period is applied uniformly and does not exceed two months or the period starts on the enrollment date and runs concurrently with waiting periods.

This act requires group health insurance issuers to follow standards prohibiting discrimination of eligible individuals based on physical or mental health, claims experience, medical history, genetic information, insurability, or disability and premiums based on health status.

The act establishes standards for group health insurers prohibiting discrimination on premium contributions based on health status. A group health insurer shall not individuals to, as a condition of enrollment, pay a premium that is greater than a premium from a similarly situated individual on the basis of any health status-related factor. This, however, shall not prevent a group health insurer from offering premium discounts or rebates for adherence to health promotion and disease prevention programs (Section 376.451.2).

The act sets forth rules for renewing large group health insurance plans. Under the act, health insurance issuers offering large group market plans shall renew or continue the coverage at the option of the plan sponsor. The health insurance issuer may discontinue coverage for nonpayment of premiums, fraudulent activity by the sponsor (including misrepresentation of material facts relating to coverage), sponsor’s failure to comply with minimum participation requirements, sponsor’s failure to comply with employer contribution requirements, and other conditions set forth in the act.

A health insurance issuer shall not discontinue offering a particular type of group coverage in the group market unless:

(1) The issuer provides at least 90 days notice of such fact to each plan's sponsor;

(2) The issuer offers each plan sponsor the option to purchase other types of group coverage offered in the large market; and

(3) The issuer acts uniformly without regard to the claims experience of those plan sponsors or health-status factors of any participant or new participant.

A health insurance issuer shall not discontinue offering all group coverage in the large market unless:

(1) The health insurance issuer provides at least 180 days to the director, plan sponsors and beneficiaries prior to the date of discontinuation; and

(2) All health insurance issued in Missouri in the large group market is continued and is not renewed.

Under this act, an employee that provides health insurance coverage may not provide such coverage if the employer has established a premium-only cafeteria plan under federal law (26 U.S.C. §125)(Section 376.453).

The act sets forth similar renewal and discontinuance rules for health insurer issuers offering individual policies in the individual market (Section 376.454).

MISSOURI HEALTH INSURANCE POOL (HIGH RISK) - The act modifies the definition section that governs the Missouri high risk pool provisions. The act adds several new definitions to the high risk pool provision to bring the Missouri Health Insurance Pool into compliance with the federal Health Insurance Portability and Accountability Act (HIPPA) (Section 376.960).

The act specifically provides authority for the director of the Department of Insurance to remove pool board members for neglect of duty, misfeasance, malfeasance, or nonfeasance in office (Section 376.961).

The act allows the board to administer separate accounts to separate federally defined eligible individuals and trade act eligible individuals from other pool eligible individuals (Section 376.964).

The act establishes criteria for determining the individuals eligibility for the high-risk pool and for determining when notifications need to be provided to pool members regarding underwriting, eligibility, premiums, and changes in coverage. Under the act, the following individual persons shall be eligible for pool coverage:

(1) An individual person who provides evidence of rejection by 2 or more insurers or refusal by an insurer to issue health insurance except at a rate exceeding the plan rate for substantially similar health insurance;

(2) A federally defined eligible individual who has not experienced a significant break in coverage;

(3) A trade act eligible individual;

(4) Each resident dependent of a person who is eligible for plan coverage;

(5) Any person, regardless of age, that can be claimed as a dependent of a trade act eligible individual on such trade act eligible individual's tax filing;

(6) Any person whose health insurance coverage is involuntarily terminated for any reason other than nonpayment of premium or fraud;

(7) Any person whose premiums for health insurance coverage have increased to 150% or more of rates established by the board as applicable for individual standard risks;

(8) Any person currently insured who would have qualified as a federally defined eligible individual or a trade act eligible individual between the effective date of the federal Health Insurance Portability and Accountability Act of 1996 and the effective date of this act.

The act also sets forth which individuals are not eligible for pool coverage. Under the act, persons who have or obtain coverage similar to a pool plan are ineligible for coverage. This exclusion shall not apply to a person who has such coverage if the premiums for such coverage have increased to 150% or more of rates established by the board (down from 300%). A person may maintain eligibility by maintaining other insurance coverage in order to satisfy a preexisting condition waiting period. Similarly, a person may maintain plan coverage to satisfy a preexisting condition waiting period under another health insurance policy intended to replace the pool policy (Section 376.966.3).

Under the act, insurers are required to notify individuals of the existence of the pool and its eligibility requirements if the insurers take certain actions (rejection or cancellation of coverage or limitation of coverage) which are likely to render the individual eligible for pool coverage (Section 376.966.5).

The act requires the pool to establish premium rates for pool coverage. Premium rates and schedules must be submitted to the director for approval prior to use. The standard risk rate shall be determined by considering the premium rates charged by other health insurers offering individual coverage. The initial rates for pool coverage shall not be less than 125% of rates established as applicable for individual standard risks (down from 150%). In no event shall pool rates exceed 135% of the standard rate charge (down from 200% of standard rate) (Section 376.986.4).

The act requires pool coverage to exclude expenses for 12 months for pre-existing conditions. The act excludes certain individuals (including federally defined eligible individuals and trade act eligible individuals) without significant gaps in coverage (63 days) from pre-existing condition exclusions (Section 376.986.6 and .7).

The act specifically exempts the pool board administrator, board members, and pool employees from legal action pertaining to participation in the required duties of the pool (Section 376.989).

SMALL EMPLOYER HEALTH INSURANCE AVAILABILITY ACT - The act modifies the definition section that governs the Small Employer Health Insurance Availability Act to bring that portion of Missouri law into compliance with the federal Health Insurance Portability and Accountability Act (HIPPA) (Section 376.930). Most notably, the act modifies the definition of "small employer" to mean an employer than employs on average at least two but no more than 50 eligible employees (increased from 25 employees).

The act modifies the provision governing when a small employer may renew a small employer health benefit plan. The act provides that a small employer carrier that elects to discontinue offering a particular plan must provide at least 90 days notice to each plan sponsor, offer each plan sponsor the option to purchase other health benefit plans, and act uniformly without regard to claims experience and health status factors. A small employer carrier that elects to discontinue offering all health insurance coverage in Missouri must provide at least 180 days notice to the director and each plan sponsor. The act provides that an eligible employee of a small employer may choose to retain their individual health insurance policy at the time of open enrollment so long as the small employer provides a defined contribution through a cafeteria 125 plan.

The act repeals three provisions that related to the establishment and operation of the Missouri Small Employer Health Reinsurance Program and the Health Benefit Plan Committee (which is in essence defunct as it statutory duty has already been performed)(Sections 379.942, 379.943, and 379.944).

PRESCRIPTION DRUG COVERAGE CANCELLATION - Under the act, a health carrier is required to provide at least 30 days written or electronic notification prior to deleting any drugs from the carrier's prescription drug formulary (Section 376.392).

HEALTH CARRIER CLAIMS DATA - Beginning January 1, 2008, this act requires health carriers to provide a report of the total number and dollar amount of claims paid in the previous three years within 30 days of an employer's request. A health carrier, however, shall not be required to provide the report more than twice in any calendar year. When an employer has multiple plans, the total dollar amounts must be aggregated into one report. The information provided to the employer shall be furnished in a manner that does not individually identify any employee or other person covered by the health benefit plan and shall comply with all applicable federal and state privacy laws regarding the disclosure of health records. The act defines employer as one who provides an employee health benefit plan with at least 51 covered lives either at the time of the request or at the start of the reporting period and has been insured continuously with the carrier for at least the preceding 22 months. This act is similar to SCS/SB 100 (2007) and HB 791 (2007)(section 376.435).

STEPHEN WITTE


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