House Bill hb0803
CODING: Words stricken are deletions; words underlined are additions.
Florida House of Representatives - 2001 HB 803
By Representative Negron
1 A bill to be entitled
2 An act relating to physician collective
3 negotiations; providing legislative findings;
4 providing definitions; authorizing competing
5 physicians within a health plan service area to
6 meet and communicate for collective negotiation
7 of certain contract terms and conditions;
8 providing a prohibition; providing an
9 exception; imposing criteria on such collective
10 negotiations; providing requirements for
11 physicians' representatives; providing duties
12 of the Department of Insurance; providing for
13 antitrust application; providing an effective
14 date.
15
16 Be It Enacted by the Legislature of the State of Florida:
17
18 Section 1. Physician collective negotiations.--
19 (1) The Legislature finds that collective negotiation
20 by competing physicians of certain terms and conditions of
21 contracts with health plans will result in procompetitive
22 effects in the absence of any express or implied threat of
23 retaliatory collective action by physicians, such as a boycott
24 or strike. Although the Legislature finds that collective
25 negotiations over fee-related terms may in some circumstances
26 yield anticompetitive effects, the Legislature also recognizes
27 that there are instances in which health plans dominate the
28 market to such a degree that fair negotiations between
29 physicians and health plans are unobtainable absent any
30 collective action on behalf of physicians. In these
31 instances, health plans have the ability to virtually dictate
1
CODING: Words stricken are deletions; words underlined are additions.
Florida House of Representatives - 2001 HB 803
786-100-01
1 the terms of the contracts they offer physicians.
2 Consequently, the Legislature finds it appropriate and
3 necessary to authorize collective negotiations over
4 fee-related and other issues when such imbalances exist.
5 (2) For purposes of this act:
6 (a) "Health plan" means any health maintenance
7 organization as defined in s. 641.19, Florida Statutes, or any
8 prepaid health clinic as defined in s. 641.402, Florida
9 Statutes.
10 (b) "Department" means the Department of Insurance.
11 (c) "Person" means an individual, association, or
12 corporation, or any other legal entity.
13 (d) "Physicians' representative" means a third party,
14 including a member of the physicians' group who will engage in
15 joint negotiations, who is authorized by physicians to
16 negotiate on their behalf with health benefit plans over
17 contractual terms and conditions affecting those physicians.
18 (3) Competing physicians within the service area of a
19 health plan may meet and communicate for the purpose of
20 collectively negotiating the following terms and conditions of
21 contracts with the health plan:
22 (a) Practices and procedures to assess and improve the
23 delivery of effective, cost-efficient preventive health care
24 services, including, but not limited to, childhood
25 immunizations, prenatal care, mammograms, and other cancer
26 screening tests or procedures.
27 (b) Practices and procedures to encourage early
28 detection and effective, cost-efficient management of diseases
29 and illnesses in children.
30 (c) Practices and procedures to assess and improve the
31 delivery of women's medical and health care, including, but
2
CODING: Words stricken are deletions; words underlined are additions.
Florida House of Representatives - 2001 HB 803
786-100-01
1 not limited to, care associated with menopause and
2 osteoporosis.
3 (d) Clinical criteria for effective, cost-efficient
4 disease management programs, including, but not limited to,
5 programs associated with diabetes, asthma, and cardiovascular
6 disease.
7 (e) Practices and procedures to encourage and promote
8 patient education and treatment compliance, including, but not
9 limited to, parental involvement in children's health care.
10 (f) Practices and procedures to identify, correct, and
11 prevent potentially fraudulent activities.
12 (g) Practices and procedures for the effective,
13 cost-efficient use of outpatient surgery.
14 (h) Clinical practice guidelines and coverage
15 criteria.
16 (i) Respective physician and health plan liability for
17 the treatment or lack of treatment of health plan enrollees.
18 (j) Administrative procedures, including methods and
19 timing of physician payment for services.
20 (k) Dispute resolution procedures relating to disputes
21 between health plans and physicians.
22 (l) Patient referral procedures.
23 (m) Formulation and application of reimbursement
24 methodology.
25 (n) Quality assurance programs.
26 (o) Health service utilization review procedures.
27 (p) Health plan physician selection and termination
28 criteria or whether to engage in selective contracting.
29 (q) The inclusion or alteration of terms and
30 conditions to the extent they are the subject of government
31 regulation prohibiting or requiring the particular term or
3
CODING: Words stricken are deletions; words underlined are additions.
Florida House of Representatives - 2001 HB 803
786-100-01
1 condition in question; however, such restriction does not
2 limit physician rights to collectively petition government for
3 a change in such regulation. Nothing in this paragraph shall
4 be construed to allow a boycott.
5 (4) Except as provided in subsection (5), competing
6 physicians shall not meet and communicate for the purposes of
7 collectively negotiating the following terms and conditions of
8 contracts with health plans:
9 (a) The fees or prices for services, including those
10 arrived at by applying any reimbursement methodology
11 procedures.
12 (b) The conversion factors in a resource-based
13 relative value scale reimbursement methodology or similar
14 methodologies.
15 (c) The amount of any discount on the price of
16 services to be rendered by physicians.
17 (d) The dollar amount of capitation or fixed payment
18 for health services rendered by physicians to health plan
19 enrollees.
20 (5) Competing physicians within the service area of a
21 health plan may collectively negotiate the terms and
22 conditions specified in subsection (4) if the health plan has
23 substantial market power. Substantial market power is deemed
24 to exist if the health plan's market share exceeds 15 percent,
25 as measured by:
26 (a) The number of covered lives as reported by the
27 Insurance Commissioner; or
28 (b) The actual number of consumers of prepaid
29 comprehensive health services.
30
31
4
CODING: Words stricken are deletions; words underlined are additions.
Florida House of Representatives - 2001 HB 803
786-100-01
1 Substantial market power is also deemed to exist if a health
2 plan's market share exceeds 15 percent within a particular
3 market segment, broken down into the Medicare, Medicaid,
4 commercial managed care, and health maintenance organization
5 market segments.
6 (6) Competing physicians' exercise of collective
7 negotiation rights granted by subsections (3) and (5) shall
8 conform to the following criteria:
9 (a) Physicians may communicate with each other with
10 respect to the contractual terms and conditions to be
11 negotiated with a health plan.
12 (b) Physicians may communicate with a physicians'
13 representative who is authorized to negotiate on their behalf
14 with health plans over such contractual terms and conditions.
15 (c) The physicians' representative is the sole party
16 authorized to negotiate with health plans on behalf of the
17 physicians as a group.
18 (d) Physicians may be bound by the terms and
19 conditions negotiated by the physicians' representative
20 authorized to represent their interests.
21 (e) Health plans communicating or negotiating with the
22 physicians' representative shall remain free to contract with
23 or offer different contract terms and conditions to individual
24 competing physicians.
25 (f) The physicians' representative shall not represent
26 more than 30 percent of the market of practicing physicians
27 for the provision of services or a particular physician type
28 or specialty in the service area or proposed service area of a
29 health plan with less than 5 percent of the market, as
30 measured by:
31
5
CODING: Words stricken are deletions; words underlined are additions.
Florida House of Representatives - 2001 HB 803
786-100-01
1 1. The number of covered lives as reported by the
2 Insurance Commissioner; or
3 2. The actual number of consumers of prepaid
4 comprehensive health services.
5 (g) The physicians' representative shall comply with
6 the provisions of subsection (7).
7 (7) Any person or organization proposing to act or
8 acting as a physicians' representative for the purpose of
9 exercising authority granted under this act shall comply with
10 the following requirements:
11 (a) Before engaging in any collective negotiations
12 with health plans on behalf of competing physicians, the
13 representative shall file with the department information
14 identifying the representative, the representative's plan of
15 operation, and the representative's procedures to ensure
16 compliance with this section.
17 (b) Before engaging in any collective negotiations
18 with health plans on behalf of competing physicians, the
19 representative shall provide to the department a report
20 identifying the proposed subject matter of the negotiations or
21 discussions with health plans and the efficiencies or benefits
22 expected to be achieved by such negotiations. The department
23 shall approve or disapprove the negotiations proposed in the
24 report. The department shall withhold approval if the proposed
25 negotiations would exceed the authority granted under this
26 act. The representative shall supplement the report to the
27 department as new information becomes available that indicates
28 that the subject matter of the negotiations with the health
29 plan has changed or will change.
30 (c) Within 14 days after a health plan decision
31 declining negotiation, terminating negotiation, or failing to
6
CODING: Words stricken are deletions; words underlined are additions.
Florida House of Representatives - 2001 HB 803
786-100-01
1 respond to a request for negotiation, the representative shall
2 report to the department that negotiations have ceased.
3 (d) Before reporting the results of negotiations with
4 a health plan and before giving physicians an evaluation of
5 any offer made by a health plan, the representative shall
6 furnish for the department's approval, prior to dissemination
7 to physicians, a copy of all communications to be made to
8 physicians related to negotiations, discussions, and health
9 plan offers.
10 (8) With the advice of the Attorney General, the
11 department shall, within 30 days after the report required in
12 paragraph (7)(b) is filed, either approve or disapprove the
13 negotiations proposed in the report. If the department
14 disapproves the negotiations, the department shall furnish to
15 the physicians' representative a written explanation of any
16 deficiencies along with a statement of specific remedial
17 measures through which such deficiencies could be corrected.
18 A physicians' representative who conducts negotiations
19 proposed in the report without the department's approval is
20 deemed to act outside the authority granted under this act.
21 (9) Nothing contained in this act is intended to
22 authorize competing physicians to act in concert in response
23 to a report issued by the physicians' representative related
24 to the representative's discussions or negotiations with
25 health plans. The physicians' representative shall advise
26 physicians of the provisions of this subsection and shall warn
27 physicians of the potential for legal action against
28 physicians who violate state or federal antitrust laws by
29 exceeding the authority granted under this act.
30 Section 2. This act shall take effect October 1, 2001.
31
7
CODING: Words stricken are deletions; words underlined are additions.
Florida House of Representatives - 2001 HB 803
786-100-01
1 *****************************************
2 HOUSE SUMMARY
3
Authorizes competing physicians within a health plan
4 service area to meet and communicate for collective
negotiation of contract terms and conditions. Imposes
5 criteria on such collective negotiations. Provides
requirements for physicians' representatives. See bill
6 for details.
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
8
CODING: Words stricken are deletions; words underlined are additions.