HB 1843

1	A bill to be entitled
2	An act relating to health care; amending s. 400.23, F.S.;
3	delaying a nursing home staffing increase; providing for
4	retroactive application; amending s. 408.909, F.S.;
5	providing additional eligibility; amending s. 409.8134,
6	F.S.; revising a date for eligibility to be exempt from
7	reapplying; amending s. 409.814, F.S.; providing
8	additional eligibility for KidCare; requiring proof of
9	family income with supporting documents; amending s.
10	409.903, F.S.; eliminating services for certain persons;
11	providing income deductions; amending s. 409.905, F.S.,
12	relating to mandatory Medicaid services; requiring
13	utilization management of private duty nursing services;
14	establishing a hospitalist program; limiting payment for
15	bed hold days for nursing facilities; amending s. 409.906,
16	F.S., relating to optional Medicaid services; providing
17	for adult denture and adult hearing and visual services;
18	eliminating vacancy interim rates for intermediate care
19	facility for the developmentally disabled services;
20	requiring utilization management for home and community-
21	based services; consolidating home and community-based
22	services; amending s. 409.9065, F.S.; authorizing the
23	agency to operate a pharmaceutical expense assistance
24	program under certain circumstances; amending s. 409.907,
25	F.S.; revising Medicaid provider agreement requirements;
26	amending s. 409.908, F.S.; revising guidelines relating to
27	reimbursement of Medicaid providers; mandating the payment
28	method of county health departments; amending s. 409.911,
29	F.S.; requiring the convening of the Medicaid
30	Disproportionate Share Council and providing duties
31	thereof; amending ss. 409.9112, 409.9113, and 409.9117,
32	F.S.; restricting the agency from distributing certain
33	funds; amending s. 409.912, F.S.; granting Medicaid
34	provider network management; providing limits on certain
35	drugs; providing for management of mental health drugs;
36	reducing payment for pharmaceutical ingredient prices;
37	expanding the existing pharmaceutical supplemental rebate
38	threshold; correcting cross references; amending s.
39	409.9124, F.S.; requiring the agency to publish managed
40	care rates annually; amending s. 624.91, F.S.; revising
41	Healthy Kids contract requirements; requiring certain
42	programs be provided in certain counties; requiring the
43	agency to negotiate to reduce costs; requiring a review by
44	the Office of Program Policy Analysis and Government
45	Accountability; requiring a report; authorizing the Agency
46	for Health Care Administration to contract on a capitated,
47	prepaid, or fixed-sum basis with a laboratory service
48	provider to provide statewide laboratory services for
49	Medicaid recipients; requiring the agency to ensure that
50	it secures laboratory values from Medicaid-enrolled
51	laboratories for all tests provided to Medicaid recipients
52	and to include such data in the Medicaid real-time web-
53	based reporting system that interfaces with a real time
54	web-based prescription ordering and tracking system;
55	providing effective dates.
56
57	Be It Enacted by the Legislature of the State of Florida:
58
59	Section 1.  Effective upon this act becoming a law and
60	applying retroactively to May 1, 2004, paragraph (a) of
61	subsection (3) of section 400.23, Florida Statutes, is amended
62	to read:
63	400.23  Rules; evaluation and deficiencies; licensure
64	status.--
65	(3)(a)  The agency shall adopt rules providing for the
66	minimum staffing requirements for nursing homes. These
67	requirements shall include, for each nursing home facility, a
68	minimum certified nursing assistant staffing of 2.3 hours of
69	direct care per resident per day beginning January 1, 2002,
70	increasing to 2.6 hours of direct care per resident per day
71	beginning January 1, 2003, and increasing to 2.9 hours of direct
72	care per resident per day beginning July May 1, 2005 2004.
73	Beginning January 1, 2002, no facility shall staff below one
74	certified nursing assistant per 20 residents, and a minimum
75	licensed nursing staffing of 1.0 hour of direct resident care
76	per resident per day but never below one licensed nurse per 40
77	residents. Nursing assistants employed never below one licensed
78	nurse per 40 residents. Nursing assistants employed under s.
79	400.211(2) may be included in computing the staffing ratio for
80	certified nursing assistants only if they provide nursing
81	assistance services to residents on a full-time basis. Each
82	nursing home must document compliance with staffing standards as
83	required under this paragraph and post daily the names of staff
84	on duty for the benefit of facility residents and the public.
85	The agency shall recognize the use of licensed nurses for
86	compliance with minimum staffing requirements for certified
87	nursing assistants, provided that the facility otherwise meets
88	the minimum staffing requirements for licensed nurses and that
89	the licensed nurses so recognized are performing the duties of a
90	certified nursing assistant. Unless otherwise approved by the
91	agency, licensed nurses counted towards the minimum staffing
92	requirements for certified nursing assistants must exclusively
93	perform the duties of a certified nursing assistant for the
94	entire shift and shall not also be counted towards the minimum
95	staffing requirements for licensed nurses. If the agency
96	approved a facility's request to use a licensed nurse to perform
97	both licensed nursing and certified nursing assistant duties,
98	the facility must allocate the amount of staff time specifically
99	spent on certified nursing assistant duties for the purpose of
100	documenting compliance with minimum staffing requirements for
101	certified and licensed nursing staff. In no event may the hours
102	of a licensed nurse with dual job responsibilities be counted
103	twice.
104	Section 2.  Paragraphs (c) and (d) of subsection (5) of
105	section 408.909, Florida Statutes, are redesignated as
106	paragraphs (d) and (e), respectively, present paragraph (c) of
107	subsection (5) of said section is amended, and a new paragraph
108	(c) is added to said subsection, to read:
109	408.909  Health flex plans.--
110	(5)  ELIGIBILITY.--Eligibility to enroll in an approved
111	health flex plan is limited to residents of this state who:
112	(c)  Are eligible under a federally approved Medicaid
113	demonstration waiver and reside in Palm Beach County or Miami-
114	Dade County;
115	(d)(c)  Are not covered by a private insurance policy and
116	are not eligible for coverage through a public health insurance
117	program, such as Medicare or Medicaid, unless specifically
118	authorized under paragraph (c), or another public health care
119	program, such as KidCare, and have not been covered at any time
120	during the past 6 months; and
121	Section 3.  Subsection (2) of section 409.8134, Florida
122	Statutes, as amended by chapter 2004-1, Laws of Florida, is
123	amended to read:
124	409.8134  Program enrollment and expenditure ceilings.--
125	(2)  Upon a unanimous recommendation by representatives
126	from each of the four Florida KidCare administrators, the
127	Florida KidCare program may conduct an open enrollment period
128	for the purpose of enrolling children eligible for all program
129	components listed in s. 409.813 except Medicaid. The four
130	Florida KidCare administrators shall work together to ensure
131	that the open enrollment period is announced statewide at least
132	1 month before the open enrollment is to begin. Eligible
133	children shall be enrolled on a first-come, first-served basis
134	using the date the open enrollment application is received. The
135	potential open enrollment periods shall be January 1st through
136	January 30th and September 1st through September 30th. Open
137	enrollment shall immediately cease when the enrollment ceiling
138	is reached reaches. An open enrollment shall only be held if the
139	Social Services Estimating Conference determines that sufficient
140	federal and state funds will be available to finance the
141	increased enrollment through federal fiscal year 2007. Any
142	individual who is not enrolled, including those added to the
143	waiting list after March 11 January 30, 2004, must reapply by
144	submitting a new application during the next open enrollment
145	period. However, the Children's Medical Services Network may
146	annually enroll up to 120 additional children based on emergency
147	disability criteria outside of the open enrollment periods and
148	the cost of serving these children must be managed within the
149	KidCare program's appropriated or authorized levels of funding.
150	Except for the Medicaid program, whenever the Social Services
151	Estimating Conference determines that there is presently, or
152	will be by the end of the current fiscal year, insufficient
153	funds to finance the current or projected enrollment in the
154	Florida KidCare program, all additional enrollment must cease
155	and additional enrollment may not resume until sufficient funds
156	are available to finance such enrollment.
157
158	Section 4.  Paragraph (f) of subsection (4) and paragraph
159	(a) of subsection (8) of section 409.814, Florida Statutes, as
160	amended by chapter 2004-1, Laws of Florida, are amended, and
161	paragraph (g) is added to subsection (4) of said section, to
162	read:
163	409.814  Eligibility.--A child who has not reached 19 years
164	of age whose family income is equal to or below 200 percent of
165	the federal poverty level is eligible for the Florida KidCare
166	program as provided in this section. For enrollment in the
167	Children's Medical Services network, a complete application
168	includes the medical or behavioral health screening. If,
169	subsequently, an individual is determined to be ineligible for
170	coverage, he or she must immediately be disenrolled from the
171	respective Florida KidCare program component.
172	(4)  The following children are not eligible to receive
173	premium assistance for health benefits coverage under the
174	Florida KidCare program, except under Medicaid if the child
175	would have been eligible for Medicaid under s. 409.903 or s.
176	409.904 as of June 1, 1997:
177	(f)  A child who has had his or her coverage in an
178	employer-sponsored health benefit plan voluntarily canceled in
179	the last 6 months, except those children who were on the waiting
180	list prior to March 12 January 31, 2004.
181	(g)  A child who is otherwise eligible for KidCare and who
182	has a preexisting condition that prevents coverage under another
183	insurance plan as described in paragraph (b) which would have
184	disqualified the child for KidCare if the child were able to
185	enroll in the plan shall be eligible for KidCare coverage when
186	enrollment is possible.
187	(8)  In determining the eligibility of a child, an assets
188	test is not required. Each applicant shall provide written
189	documentation during the application process and the
190	redetermination process, including, but not limited to, the
191	following:
192	(a)  Proof of family income supported by copies of any
193	federal income tax return for the prior year, any wages and
194	earnings statements (W-2 forms), and any other appropriate
195	document.
196	Section 5.  Effective January 1, 2005, subsection (6) of
197	section 409.814, Florida Statutes, as amended by chapter 2004-1,
198	Laws of Florida, is amended to read:
199	409.814  Eligibility.--A child who has not reached 19 years
200	of age whose family income is equal to or below 200 percent of
201	the federal poverty level is eligible for the Florida KidCare
202	program as provided in this section. For enrollment in the
203	Children's Medical Services network, a complete application
204	includes the medical or behavioral health screening. If,
205	subsequently, an individual is determined to be ineligible for
206	coverage, he or she must immediately be disenrolled from the
207	respective Florida KidCare program component.
208	(6)  Once a child is enrolled in the Florida KidCare
209	program, the child is eligible for coverage under the program
210	for 12 6 months without a redetermination or reverification of
211	eligibility, if the family continues to pay the applicable
212	premium. Eligibility for program components funded through Title
213	XXI of the Social Security Act shall terminate when a child
214	attains the age of 19. Effective January 1, 1999, a child who
215	has not attained the age of 5 and who has been determined
216	eligible for the Medicaid program is eligible for coverage for
217	12 months without a redetermination or reverification of
218	eligibility.
219	Section 6.  Subsection (5) of section 409.903, Florida
220	Statutes, is amended to read:
221	409.903  Mandatory payments for eligible persons.--The
222	agency shall make payments for medical assistance and related
223	services on behalf of the following persons who the department,
224	or the Social Security Administration by contract with the
225	Department of Children and Family Services, determines to be
226	eligible, subject to the income, assets, and categorical
227	eligibility tests set forth in federal and state law. Payment on
228	behalf of these Medicaid eligible persons is subject to the
229	availability of moneys and any limitations established by the
230	General Appropriations Act or chapter 216.
231	(5)  A pregnant woman for the duration of her pregnancy and
232	for the postpartum period as defined in federal law and rule, or
233	a child under age 1, if either is living in a family that has an
234	income which is at or below 150 percent of the most current
235	federal poverty level, or, effective January 1, 1992, that has
236	an income which is at or below 185 percent of the most current
237	federal poverty level. Such a person is not subject to an assets
238	test. Further, a pregnant woman who applies for eligibility for
239	the Medicaid program through a qualified Medicaid provider must
240	be offered the opportunity, subject to federal rules, to be made
241	presumptively eligible for the Medicaid program. Effective July
242	1, 2005, eligibility for Medicaid services is eliminated for
243	women who have incomes above 150 percent of the most current
244	federal poverty level.
245	Section 7.  Subsections (2) and (3) of section 409.904,
246	Florida Statutes, are amended to read:
247	409.904  Optional payments for eligible persons.--The
248	agency may make payments for medical assistance and related
249	services on behalf of the following persons who are determined
250	to be eligible subject to the income, assets, and categorical
251	eligibility tests set forth in federal and state law. Payment on
252	behalf of these Medicaid eligible persons is subject to the
253	availability of moneys and any limitations established by the
254	General Appropriations Act or chapter 216.
255	(2)  A family, a pregnant woman, a child under age 21, a
256	person age 65 or over, or a blind or disabled person, who would
257	be eligible under any group listed in s. 409.903(1), (2), or
258	(3), except that the income or assets of such family or person
259	exceed established limitations. For a family or person in one of
260	these coverage groups, medical expenses are deductible from
261	income in accordance with federal requirements in order to make
262	a determination of eligibility. A family or person eligible
263	under the coverage known as the "medically needy," is eligible
264	to receive the same services as other Medicaid recipients, with
265	the exception of services in skilled nursing facilities and
266	intermediate care facilities for the developmentally disabled.
267	Effective July 1, 2005, the medically needy are eligible for
268	prescribed drug services only.
269	(3)  A person who is in need of the services of a licensed
270	nursing facility, a licensed intermediate care facility for the
271	developmentally disabled, or a state mental hospital, whose
272	income does not exceed 300 percent of the SSI income standard,
273	and who meets the assets standards established under federal and
274	state law. In determining the person's responsibility for the
275	cost of care, the following amounts must be deducted from the
276	person's income:
277	(a)  The monthly personal allowance for residents as set
278	based on appropriations.
279	(b)  The reasonable costs of medically necessary services
280	and supplies that are not reimbursable by the Medicaid program.
281	(c)  The cost of premiums, copayments, coinsurance, and
282	deductibles for supplemental health insurance.
283	Section 8.  Subsections (4), (5), and (8) of section
284	409.905, Florida Statutes, are amended to read:
285	409.905  Mandatory Medicaid services.--The agency may make
286	payments for the following services, which are required of the
287	state by Title XIX of the Social Security Act, furnished by
288	Medicaid providers to recipients who are determined to be
289	eligible on the dates on which the services were provided. Any
290	service under this section shall be provided only when medically
291	necessary and in accordance with state and federal law.
292	Mandatory services rendered by providers in mobile units to
293	Medicaid recipients may be restricted by the agency. Nothing in
294	this section shall be construed to prevent or limit the agency
295	from adjusting fees, reimbursement rates, lengths of stay,
296	number of visits, number of services, or any other adjustments
297	necessary to comply with the availability of moneys and any
298	limitations or directions provided for in the General
299	Appropriations Act or chapter 216.
300	(4)  HOME HEALTH CARE SERVICES.--The agency shall pay for
301	nursing and home health aide services, supplies, appliances, and
302	durable medical equipment, necessary to assist a recipient
303	living at home. An entity that provides services pursuant to
304	this subsection shall be licensed under part IV of chapter 400
305	or part II of chapter 499, if appropriate. These services,
306	equipment, and supplies, or reimbursement therefor, may be
307	limited as provided in the General Appropriations Act and do not
308	include services, equipment, or supplies provided to a person
309	residing in a hospital or nursing facility.
310	(a)  In providing home health care services, the agency may
311	require prior authorization of care based on diagnosis.
312	(b)  The agency shall implement a comprehensive utilization
313	management program that requires prior authorization of all
314	private duty nursing services, an individualized treatment plan
315	that includes information about medication and treatment orders,
316	treatment goals, methods of care to be used, and plans for care
317	coordination by nurses and other health professionals. The
318	utilization management program shall also include a process for
319	periodically reviewing the ongoing use of private duty nursing
320	services. The assessment of need shall be based on a child's
321	condition, family support and care supplements, a family's
322	ability to provide care, and a family's and child's schedule
323	regarding work, school, sleep, and care for other family
324	dependents. When implemented, the private duty nursing
325	utilization management program shall replace the current
326	authorization program used by the Agency for Health Care
327	Administration and the Children's Medical Services program of
328	the Department of Health. The agency may competitively bid on a
329	contract to select a qualified organization to provide
330	utilization management of private duty nursing services. The
331	agency is authorized to seek federal waivers to implement this
332	initiative.
333	(5)  HOSPITAL INPATIENT SERVICES.--The agency shall pay for
334	all covered services provided for the medical care and treatment
335	of a recipient who is admitted as an inpatient by a licensed
336	physician or dentist to a hospital licensed under part I of
337	chapter 395. However, the agency shall limit the payment for
338	inpatient hospital services for a Medicaid recipient 21 years of
339	age or older to 45 days or the number of days necessary to
340	comply with the General Appropriations Act.
341	(a)  The agency is authorized to implement reimbursement
342	and utilization management reforms in order to comply with any
343	limitations or directions in the General Appropriations Act,
344	which may include, but are not limited to: prior authorization
345	for inpatient psychiatric days; prior authorization for
346	nonemergency hospital inpatient admissions for individuals 21
347	years of age and older; authorization of emergency and urgent-
348	care admissions within 24 hours after admission; enhanced
349	utilization and concurrent review programs for highly utilized
350	services; reduction or elimination of covered days of service;
351	adjusting reimbursement ceilings for variable costs; adjusting
352	reimbursement ceilings for fixed and property costs; and
353	implementing target rates of increase. The agency may limit
354	prior authorization for hospital inpatient services to selected
355	diagnosis-related groups, based on an analysis of the cost and
356	potential for unnecessary hospitalizations represented by
357	certain diagnoses. Admissions for normal delivery and newborns
358	are exempt from requirements for prior authorization. In
359	implementing the provisions of this section related to prior
360	authorization, the agency shall ensure that the process for
361	authorization is accessible 24 hours per day, 7 days per week
362	and authorization is automatically granted when not denied
363	within 4 hours after the request. Authorization procedures must
364	include steps for review of denials. Upon implementing the prior
365	authorization program for hospital inpatient services, the
366	agency shall discontinue its hospital retrospective review
367	program.
368	(b)  A licensed hospital maintained primarily for the care
369	and treatment of patients having mental disorders or mental
370	diseases is not eligible to participate in the hospital
371	inpatient portion of the Medicaid program except as provided in
372	federal law. However, the department shall apply for a waiver,
373	within 9 months after June 5, 1991, designed to provide
374	hospitalization services for mental health reasons to children
375	and adults in the most cost-effective and lowest cost setting
376	possible. Such waiver shall include a request for the
377	opportunity to pay for care in hospitals known under federal law
378	as "institutions for mental disease" or "IMD's." The waiver
379	proposal shall propose no additional aggregate cost to the state
380	or Federal Government, and shall be conducted in Hillsborough
381	County, Highlands County, Hardee County, Manatee County, and
382	Polk County. The waiver proposal may incorporate competitive
383	bidding for hospital services, comprehensive brokering, prepaid
384	capitated arrangements, or other mechanisms deemed by the
385	department to show promise in reducing the cost of acute care
386	and increasing the effectiveness of preventive care. When
387	developing the waiver proposal, the department shall take into
388	account price, quality, accessibility, linkages of the hospital
389	to community services and family support programs, plans of the
390	hospital to ensure the earliest discharge possible, and the
391	comprehensiveness of the mental health and other health care
392	services offered by participating providers.
393	(c)  The Agency for Health Care Administration shall adjust
394	a hospital's current inpatient per diem rate to reflect the cost
395	of serving the Medicaid population at that institution if:
396	1.  The hospital experiences an increase in Medicaid
397	caseload by more than 25 percent in any year, primarily
398	resulting from the closure of a hospital in the same service
399	area occurring after July 1, 1995;
400	2.  The hospital's Medicaid per diem rate is at least 25
401	percent below the Medicaid per patient cost for that year; or
402	3.  The hospital is located in a county that has five or
403	fewer hospitals, began offering obstetrical services on or after
404	September 1999, and has submitted a request in writing to the
405	agency for a rate adjustment after July 1, 2000, but before
406	September 30, 2000, in which case such hospital's Medicaid
407	inpatient per diem rate shall be adjusted to cost, effective
408	July 1, 2002.
409
410	No later than October 1 of each year, the agency must provide
411	estimated costs for any adjustment in a hospital inpatient per
412	diem pursuant to this paragraph to the Executive Office of the
413	Governor, the House of Representatives General Appropriations
414	Committee, and the Senate Appropriations Committee. Before the
415	agency implements a change in a hospital's inpatient per diem
416	rate pursuant to this paragraph, the Legislature must have
417	specifically appropriated sufficient funds in the General
418	Appropriations Act to support the increase in cost as estimated
419	by the agency.
420	(d)  The agency shall implement a hospitalist program in
421	certain high-volume participating hospitals, select counties, or
422	statewide. The program shall require hospitalists to authorize
423	and manage Medicaid recipients' hospital admissions and lengths
424	of stay. Individuals who are dually eligible for Medicare and
425	Medicaid are exempted from this requirement. Medicaid
426	participating physicians and other practitioners with hospital
427	admitting privileges shall coordinate and review admissions of
428	Medicaid recipients with the hospitalist. The agency may
429	competitively bid a contract for selection of a qualified
430	organization to provide hospitalist services. The qualified
431	organization shall employ board certified physicians who are
432	full-time dedicated employees of the contractor and have no
433	outside practice. Where used, the hospitalist program shall
434	replace the existing hospital utilization review program. The
435	agency is authorized to seek federal waivers to implement this
436	program.
437	(e)  The agency shall implement a comprehensive utilization
438	management program for hospital neonatal intensive care stays in
439	certain high-volume participating hospitals, select counties, or
440	statewide, and shall replace existing hospital inpatient
441	utilization management programs for neonatal intensive care
442	admissions. The program shall be designed to manage the lengths
443	of stay for children being treated in neonatal intensive care
444	units and must seek the earliest medically appropriate discharge
445	to the child's home or other less costly treatment setting. The
446	agency may competitively bid a contract for selection of a
447	qualified organization to provide neonatal intensive care
448	utilization management services. The agency is authorized to
449	seek any federal waivers to implement this initiative.
450	(8)  NURSING FACILITY SERVICES.--The agency shall pay for
451	24-hour-a-day nursing and rehabilitative services for a
452	recipient in a nursing facility licensed under part II of
453	chapter 400 or in a rural hospital, as defined in s. 395.602, or
454	in a Medicare certified skilled nursing facility operated by a
455	hospital, as defined by s. 395.002(11), that is licensed under
456	part I of chapter 395, and in accordance with provisions set
457	forth in s. 409.908(2)(a), which services are ordered by and
458	provided under the direction of a licensed physician. However,
459	if a nursing facility has been destroyed or otherwise made
460	uninhabitable by natural disaster or other emergency and another
461	nursing facility is not available, the agency must pay for
462	similar services temporarily in a hospital licensed under part I
463	of chapter 395 provided federal funding is approved and
464	available. The agency shall pay only for bed hold days if the
465	facility has an occupancy rate of 95 percent or greater. The
466	agency is authorized to seek any federal waivers to implement
467	this policy.
468	Section 9.  Subsections (1), (13), and (15) of section
469	409.906, Florida Statutes, are amended to read:
470	409.906  Optional Medicaid services.--Subject to specific
471	appropriations, the agency may make payments for services which
472	are optional to the state under Title XIX of the Social Security
473	Act and are furnished by Medicaid providers to recipients who
474	are determined to be eligible on the dates on which the services
475	were provided. Any optional service that is provided shall be
476	provided only when medically necessary and in accordance with
477	state and federal law. Optional services rendered by providers
478	in mobile units to Medicaid recipients may be restricted or
479	prohibited by the agency. Nothing in this section shall be
480	construed to prevent or limit the agency from adjusting fees,
481	reimbursement rates, lengths of stay, number of visits, or
482	number of services, or making any other adjustments necessary to
483	comply with the availability of moneys and any limitations or
484	directions provided for in the General Appropriations Act or
485	chapter 216. If necessary to safeguard the state's systems of
486	providing services to elderly and disabled persons and subject
487	to the notice and review provisions of s. 216.177, the Governor
488	may direct the Agency for Health Care Administration to amend
489	the Medicaid state plan to delete the optional Medicaid service
490	known as "Intermediate Care Facilities for the Developmentally
491	Disabled." Optional services may include:
492	(1)  ADULT DENTAL SERVICES.--
493	(a)  The agency may pay for medically necessary, emergency
494	dental procedures to alleviate pain or infection. Emergency
495	dental care shall be limited to emergency oral examinations,
496	necessary radiographs, extractions, and incision and drainage of
497	abscess, for a recipient who is age 21 years of age or older.
498	(b)  Beginning January 1, 2005, the agency may pay for
499	dentures, the procedures required to seat dentures, and the
500	repair and reline of dentures, provided by or under the
501	direction of a licensed dentist, for a recipient who is 21 years
502	of age or older. This paragraph is repealed effective July 1,
503	2005.
504	(c)  However, Medicaid will not provide reimbursement for
505	dental services provided in a mobile dental unit, except for a
506	mobile dental unit:
507	1.(a)  Owned by, operated by, or having a contractual
508	agreement with the Department of Health and complying with
509	Medicaid's county health department clinic services program
510	specifications as a county health department clinic services
511	provider.
512	2.(b)  Owned by, operated by, or having a contractual
513	arrangement with a federally qualified health center and
514	complying with Medicaid's federally qualified health center
515	specifications as a federally qualified health center provider.
516	3.(c)  Rendering dental services to Medicaid recipients, 21
517	years of age and older, at nursing facilities.
518	4.(d)  Owned by, operated by, or having a contractual
519	agreement with a state-approved dental educational institution.
520	(13)  HOME AND COMMUNITY-BASED SERVICES.--
521	(a)  The agency may pay for home-based or community-based
522	services that are rendered to a recipient in accordance with a
523	federally approved waiver program. The agency may limit or
524	eliminate coverage for certain Project AIDS Care Waiver
525	services, preauthorize high-cost or highly utilized services, or
526	make any other adjustments necessary to comply with any
527	limitations or directions provided for in the General
528	Appropriations Act.
529	(b)  The agency may consolidate types of services offered
530	in the Aged and Disabled Waiver, the Channeling Waiver, the
531	Project AIDS Care Waiver, and the Traumatic Brain and Spinal
532	Cord Injury Waiver programs in order to group similar services
533	under a single service, or continue a service upon evidence of
534	the need for including a particular service type in a particular
535	waiver. The agency is authorized to seek a Medicaid state plan
536	amendment or federal waiver approval to implement this policy.
537	(c)  The agency may implement a utilization management
538	program designed to prior authorize home and community-based
539	service plans and includes, but is not limited to, assessing
540	proposed quantity and duration of services and monitoring
541	ongoing service use by participants in the program. The agency
542	is authorized to competitively procure a qualified organization
543	to provide utilization management of home and community-based
544	services. The agency is authorized to seek any federal waivers
545	to implement this initiative.
546	(15)  INTERMEDIATE CARE FACILITY FOR THE DEVELOPMENTALLY
547	DISABLED SERVICES.--The agency may pay for health-related care
548	and services provided on a 24-hour-a-day basis by a facility
549	licensed and certified as a Medicaid Intermediate Care Facility
550	for the Developmentally Disabled, for a recipient who needs such
551	care because of a developmental disability. Payment shall not
552	include bed-hold days except in facilities with occupancy rates
553	of 95 percent or greater. The agency is authorized to seek any
554	federal waiver approvals to implement this policy.
555	Section 10.  Subsection (8) of section 409.9065, Florida
556	Statutes, is renumbered as subsection (9), and a new subsection
557	(8) is added to said section, to read:
558	409.9065  Pharmaceutical expense assistance.--
559	(8)  PHARMACEUTICAL EXPENSE ASSISTANCE PROGRAM.--In the
560	absence of federal approval for the Lifesaver Rx Program to
561	provide benefits to higher income groups and additional
562	discounts as described in subsections (2) and (3), the Agency
563	for Health Care Administration may, subject to federal approval
564	and continuing state appropriations, operate a pharmaceutical
565	expense assistance program that limits eligibility and benefits
566	to Medicaid beneficiaries who do not normally receive Medicaid
567	benefits, are Florida residents age 65 and older, have an income
568	less than or equal to 120 percent of the federal poverty level,
569	are eligible for Medicare, and request to be enrolled in the
570	program. Benefits under the limited pharmaceutical expense
571	assistance program shall include Medicaid payment for up to $160
572	per month for prescribed drugs, subject to benefit utilization
573	controls applied to other Medicaid prescribed drug benefits and
574	the following copayments: $2 per generic product, $5 for a
575	product that is on the Medicaid Preferred Drug List, and $15 for
576	a product that is not on the preferred drug list.
577	Section 11.  Subsection (12) is added to section 409.907,
578	Florida Statutes, to read:
579	409.907  Medicaid provider agreements.--The agency may make
580	payments for medical assistance and related services rendered to
581	Medicaid recipients only to an individual or entity who has a
582	provider agreement in effect with the agency, who is performing
583	services or supplying goods in accordance with federal, state,
584	and local law, and who agrees that no person shall, on the
585	grounds of handicap, race, color, or national origin, or for any
586	other reason, be subjected to discrimination under any program
587	or activity for which the provider receives payment from the
588	agency.
589	(12)  Licensed, certified, or otherwise qualified providers
590	are not entitled to enrollment in a Medicaid provider network.
591	Section 12.  Subsections (4), (14), and (19) of section
592	409.908, Florida Statutes, are amended to read:
593	409.908  Reimbursement of Medicaid providers.--Subject to
594	specific appropriations, the agency shall reimburse Medicaid
595	providers, in accordance with state and federal law, according
596	to methodologies set forth in the rules of the agency and in
597	policy manuals and handbooks incorporated by reference therein.
598	These methodologies may include fee schedules, reimbursement
599	methods based on cost reporting, negotiated fees, competitive
600	bidding pursuant to s. 287.057, and other mechanisms the agency
601	considers efficient and effective for purchasing services or
602	goods on behalf of recipients. If a provider is reimbursed based
603	on cost reporting and submits a cost report late and that cost
604	report would have been used to set a lower reimbursement rate
605	for a rate semester, then the provider's rate for that semester
606	shall be retroactively calculated using the new cost report, and
607	full payment at the recalculated rate shall be affected
608	retroactively. Medicare-granted extensions for filing cost
609	reports, if applicable, shall also apply to Medicaid cost
610	reports. Payment for Medicaid compensable services made on
611	behalf of Medicaid eligible persons is subject to the
612	availability of moneys and any limitations or directions
613	provided for in the General Appropriations Act or chapter 216.
614	Further, nothing in this section shall be construed to prevent
615	or limit the agency from adjusting fees, reimbursement rates,
616	lengths of stay, number of visits, or number of services, or
617	making any other adjustments necessary to comply with the
618	availability of moneys and any limitations or directions
619	provided for in the General Appropriations Act, provided the
620	adjustment is consistent with legislative intent.
621	(4)  Subject to any limitations or directions provided for
622	in the General Appropriations Act, alternative health plans,
623	health maintenance organizations, and prepaid health plans shall
624	be reimbursed a fixed, prepaid amount negotiated, or
625	competitively bid pursuant to s. 287.057, by the agency and
626	prospectively paid to the provider monthly for each Medicaid
627	recipient enrolled. The amount may not exceed the average amount
628	the agency determines it would have paid, based on claims
629	experience, for recipients in the same or similar category of
630	eligibility. The agency shall calculate capitation rates on a
631	regional basis and, beginning September 1, 1995, shall include
632	age-band differentials in such calculations. Effective July 1,
633	2001, the cost of exempting statutory teaching hospitals,
634	specialty hospitals, and community hospital education program
635	hospitals from reimbursement ceilings and the cost of special
636	Medicaid payments shall not be included in premiums paid to
637	health maintenance organizations or prepaid health care plans.
638	Each rate semester, the agency shall calculate and publish a
639	Medicaid hospital rate schedule that does not reflect either
640	special Medicaid payments or the elimination of rate
641	reimbursement ceilings, to be used by hospitals and Medicaid
642	health maintenance organizations, in order to determine the
643	Medicaid rate referred to in ss. 409.912(17), 409.9128(5), and
644	641.513(6).
645	(14)  A provider of prescribed drugs shall be reimbursed
646	the least of the amount billed by the provider, the provider's
647	usual and customary charge, or the Medicaid maximum allowable
648	fee established by the agency, plus a dispensing fee. The
649	Medicaid maximum allowable fee for ingredient cost will be based
650	on the lower of: average wholesale price (AWP) minus 15.4
651	percent, wholesaler acquisition cost (WAC) plus 5.75 percent,
652	the federal upper limit (FUL), the state maximum allowable cost
653	(SMAC), or the usual and customary (UAC) charge billed by the
654	provider. Medicaid providers are required to dispense generic
655	drugs if available at lower cost and the agency has not
656	determined that the branded product is more cost-effective,
657	unless the prescriber has requested and received approval to
658	require the branded product. The agency is directed to implement
659	a variable dispensing fee for payments for prescribed medicines
660	while ensuring continued access for Medicaid recipients. The
661	variable dispensing fee may be based upon, but not limited to,
662	either or both the volume of prescriptions dispensed by a
663	specific pharmacy provider, the volume of prescriptions
664	dispensed to an individual recipient, and dispensing of
665	preferred-drug-list products. The agency may increase the
666	pharmacy dispensing fee authorized by statute and in the annual
667	General Appropriations Act by $0.50 for the dispensing of a
668	Medicaid preferred-drug-list product and reduce the pharmacy
669	dispensing fee by $0.50 for the dispensing of a Medicaid product
670	that is not included on the preferred-drug list. The agency may
671	establish a supplemental pharmaceutical dispensing fee to be
672	paid to providers returning unused unit-dose packaged
673	medications to stock and crediting the Medicaid program for the
674	ingredient cost of those medications if the ingredient costs to
675	be credited exceed the value of the supplemental dispensing fee.
676	The agency is authorized to limit reimbursement for prescribed
677	medicine in order to comply with any limitations or directions
678	provided for in the General Appropriations Act, which may
679	include implementing a prospective or concurrent utilization
680	review program.
681	(19)  County health department services shall may be
682	reimbursed a rate per visit based on total reasonable costs of
683	the clinic, as determined by the agency in accordance with
684	federal regulations under the authority of 42 C.F.R. s. 431.615.
685	Section 13.  Section 409.911, Florida Statutes, is amended
686	to read:
687	409.911  Disproportionate share program.--Subject to
688	specific allocations established within the General
689	Appropriations Act and any limitations established pursuant to
690	chapter 216, the agency shall distribute, pursuant to this
691	section, moneys to hospitals providing a disproportionate share
692	of Medicaid or charity care services by making quarterly
693	Medicaid payments as required. Notwithstanding the provisions of
694	s. 409.915, counties are exempt from contributing toward the
695	cost of this special reimbursement for hospitals serving a
696	disproportionate share of low-income patients.
697	(1)  Definitions.--As used in this section, s. 409.9112,
698	and the Florida Hospital Uniform Reporting System manual:
699	(a)  "Adjusted patient days" means the sum of acute care
700	patient days and intensive care patient days as reported to the
701	Agency for Health Care Administration, divided by the ratio of
702	inpatient revenues generated from acute, intensive, ambulatory,
703	and ancillary patient services to gross revenues.
704	(b)  "Actual audited data" or "actual audited experience"
705	means data reported to the Agency for Health Care Administration
706	which has been audited in accordance with generally accepted
707	auditing standards by the agency or representatives under
708	contract with the agency.
709	(c)  "Charity care" or "uncompensated charity care" means
710	that portion of hospital charges reported to the Agency for
711	Health Care Administration for which there is no compensation,
712	other than restricted or unrestricted revenues provided to a
713	hospital by local governments or tax districts regardless of the
714	method of payment, for care provided to a patient whose family
715	income for the 12 months preceding the determination is less
716	than or equal to 200 percent of the federal poverty level,
717	unless the amount of hospital charges due from the patient
718	exceeds 25 percent of the annual family income. However, in no
719	case shall the hospital charges for a patient whose family
720	income exceeds four times the federal poverty level for a family
721	of four be considered charity.
722	(d)  "Charity care days" means the sum of the deductions
723	from revenues for charity care minus 50 percent of restricted
724	and unrestricted revenues provided to a hospital by local
725	governments or tax districts, divided by gross revenues per
726	adjusted patient day.
727	(e)  "Hospital" means a health care institution licensed as
728	a hospital pursuant to chapter 395, but does not include
729	ambulatory surgical centers.
730	(f)  "Medicaid days" means the number of actual days
731	attributable to Medicaid patients as determined by the Agency
732	for Health Care Administration.
733	(2)  The Agency for Health Care Administration shall use
734	the following actual audited data to determine the Medicaid days
735	and charity care to be used in calculating the disproportionate
736	share payment:
737	(a)  The average of the 1997, 1998, and 1999, and 2000
738	audited data to determine each hospital's Medicaid days and
739	charity care.
740	(b)  The average of the audited disproportionate share data
741	for the years available if the Agency for Health Care
742	Administration does not have the prescribed 3 years of audited
743	disproportionate share data for a hospital.
744	(c)  In accordance with s. 1923(b) of the Social Security
745	Act, a hospital with a Medicaid inpatient utilization rate
746	greater than one standard deviation above the statewide mean or
747	a hospital with a low-income utilization rate of 25 percent or
748	greater shall qualify for reimbursement.
749	(3)  Hospitals that qualify for a disproportionate share
750	payment solely under paragraph (2)(c) shall have their payment
751	calculated in accordance with the following formulas:
752
753	DSHP = (HMD/TMSD) x $1 million
754
755	Where:
756	DSHP = disproportionate share hospital payment.
757	HMD = hospital Medicaid days.
758	TSD = total state Medicaid days.
759
760	Any funds not allocated to hospitals qualifying under this
761	section shall be redistributed to the non-state government owned
762	or operated hospitals with greater than 3,300 Medicaid days.
763	(4)  The following formulas shall be used to pay
764	disproportionate share dollars to public hospitals:
765	(a)  For state mental health hospitals:
766
767	DSHP = (HMD/TMDMH) x TAAMH
768
769	shall be the difference between the federal cap for
770	Institutions for Mental Diseases and the amounts paid under the
771	mental health disproportionate share program.
772
773	Where:
774	DSHP = disproportionate share hospital payment.
775	HMD = hospital Medicaid days.
776	TMDHH = total Medicaid days for state mental health
777	hospitals.
778	TAAMH = total amount available for mental health hospitals.
779
780	(b)  For non-state government owned or operated hospitals
781	with 3,300 or more Medicaid days:
782
783	DSHP = [(.82 x HCCD/TCCD) + (.18 x HMD/TMD)]
784	x TAAPH
785	TAAPH = TAA - TAAMH
786
787	Where:
788	TAA = total available appropriation.
789	TAAPH = total amount available for public hospitals.
790	DSHP = disproportionate share hospital payments.
791	HMD = hospital Medicaid days.
792	TMD = total state Medicaid days for public hospitals.
793	HCCD = hospital charity care dollars.
794	TCCD = total state charity care dollars for public non-
795	state hospitals.
796
797	The TAAPH shall be reduced by $6,365,257 before computing the
798	DSHP for each public hospital. The $6,365,257 shall be
799	distributed equally between the public hospitals that are also
800	designated statutory teaching hospitals.
801	(c)  For non-state government owned or operated hospitals
802	with less than 3,300 Medicaid days, a total of $750,000 $400,000
803	shall be distributed equally among these hospitals.
804	(5)  In no case shall total payments to a hospital under
805	this section, with the exception of public non-state facilities
806	or state facilities, exceed the total amount of uncompensated
807	charity care of the hospital, as determined by the agency
808	according to the most recent calendar year audited data
809	available at the beginning of each state fiscal year.
810	(6)  The agency is authorized to receive funds from local
811	governments and other local political subdivisions for the
812	purpose of making payments, including federal matching funds,
813	through the Medicaid disproportionate share program. Funds
814	received from local governments for this purpose shall be
815	separately accounted for and shall not be commingled with other
816	state or local funds in any manner.
817	(7)  Payments made by the agency to hospitals eligible to
818	participate in this program shall be made in accordance with
819	federal rules and regulations.
820	(a)  If the Federal Government prohibits, restricts, or
821	changes in any manner the methods by which funds are distributed
822	for this program, the agency shall not distribute any additional
823	funds and shall return all funds to the local government from
824	which the funds were received, except as provided in paragraph
825	(b).
826	(b)  If the Federal Government imposes a restriction that
827	still permits a partial or different distribution, the agency
828	may continue to disburse funds to hospitals participating in the
829	disproportionate share program in a federally approved manner,
830	provided:
831	1.  Each local government which contributes to the
832	disproportionate share program agrees to the new manner of
833	distribution as shown by a written document signed by the
834	governing authority of each local government; and
835	2.  The Executive Office of the Governor, the Office of
836	Planning and Budgeting, the House of Representatives, and the
837	Senate are provided at least 7 days' prior notice of the
838	proposed change in the distribution, and do not disapprove such
839	change.
840	(c)  No distribution shall be made under the alternative
841	method specified in paragraph (b) unless all parties agree or
842	unless all funds of those parties that disagree which are not
843	yet disbursed have been returned to those parties.
844	(8)  Notwithstanding the provisions of chapter 216, the
845	Executive Office of the Governor is hereby authorized to
846	establish sufficient trust fund authority to implement the
847	disproportionate share program.
848	(9)  The Agency for Health Care Administration shall create
849	a Medicaid Disproportionate Share Council.
850	(a)  The purpose of the council is to study and make
851	recommendations regarding:
852	1.  The formula for the regular disproportionate share
853	program and alternative financing options.
854	2.  Enhanced Medicaid funding through the Special Medicaid
855	Payment program.
856	3.  The federal status of the upper-payment-limit funding
857	option and how this option may be used to promote health care
858	initiatives determined by the council to be state health care
859	priorities.
860	(b)  The council shall include representatives of the
861	Executive Office of the Governor and of the agency;
862	representatives from teaching, public, private nonprofit,
863	private for-profit and family practice teaching hospitals; and
864	representatives from other groups as needed.
865	(c)  The council shall submit its findings and
866	recommendations to the Governor and the Legislature no later
867	than February 1 of each year.
868	Section 14.  Section 409.9112, Florida Statutes, is amended
869	to read:
870	409.9112  Disproportionate share program for regional
871	perinatal intensive care centers.--In addition to the payments
872	made under s. 409.911, the Agency for Health Care Administration
873	shall design and implement a system of making disproportionate
874	share payments to those hospitals that participate in the
875	regional perinatal intensive care center program established
876	pursuant to chapter 383. This system of payments shall conform
877	with federal requirements and shall distribute funds in each
878	fiscal year for which an appropriation is made by making
879	quarterly Medicaid payments. Notwithstanding the provisions of
880	s. 409.915, counties are exempt from contributing toward the
881	cost of this special reimbursement for hospitals serving a
882	disproportionate share of low-income patients. For the state
883	fiscal year 2004-2005, the agency shall not distribute moneys
884	under the regional perinatal intensive care centers
885	disproportionate share program, except as noted in subsection
886	(2). In the event the Centers for Medicare and Medicaid Services
887	do not approve Florida's inpatient hospital state plan amendment
888	for the public disproportionate share program by January 1,
889	2005, the agency may make payments to hospitals under the
890	regional perinatal intensive care centers disproportionate share
891	program.
892	(1)  The following formula shall be used by the agency to
893	calculate the total amount earned for hospitals that participate
894	in the regional perinatal intensive care center program:
895
896	TAE = HDSP/THDSP
897
898	Where:
899	TAE = total amount earned by a regional perinatal intensive
900	care center.
901	HDSP = the prior state fiscal year regional perinatal
902	intensive care center disproportionate share payment to the
903	individual hospital.
904	THDSP = the prior state fiscal year total regional
905	perinatal intensive care center disproportionate share payments
906	to all hospitals.
907
908	(2)  The total additional payment for hospitals that
909	participate in the regional perinatal intensive care center
910	program shall be calculated by the agency as follows:
911
912	TAP = TAE x TA
913
914	Where:
915	TAP = total additional payment for a regional perinatal
916	intensive care center.
917	TAE = total amount earned by a regional perinatal intensive
918	care center.
919	TA = total appropriation for the regional perinatal
920	intensive care center disproportionate share program.
921
922	(3)  In order to receive payments under this section, a
923	hospital must be participating in the regional perinatal
924	intensive care center program pursuant to chapter 383 and must
925	meet the following additional requirements:
926	(a)  Agree to conform to all departmental and agency
927	requirements to ensure high quality in the provision of
928	services, including criteria adopted by departmental and agency
929	rule concerning staffing ratios, medical records, standards of
930	care, equipment, space, and such other standards and criteria as
931	the department and agency deem appropriate as specified by rule.
932	(b)  Agree to provide information to the department and
933	agency, in a form and manner to be prescribed by rule of the
934	department and agency, concerning the care provided to all
935	patients in neonatal intensive care centers and high-risk
936	maternity care.
937	(c)  Agree to accept all patients for neonatal intensive
938	care and high-risk maternity care, regardless of ability to pay,
939	on a functional space-available basis.
940	(d)  Agree to develop arrangements with other maternity and
941	neonatal care providers in the hospital's region for the
942	appropriate receipt and transfer of patients in need of
943	specialized maternity and neonatal intensive care services.
944	(e)  Agree to establish and provide a developmental
945	evaluation and services program for certain high-risk neonates,
946	as prescribed and defined by rule of the department.
947	(f)  Agree to sponsor a program of continuing education in
948	perinatal care for health care professionals within the region
949	of the hospital, as specified by rule.
950	(g)  Agree to provide backup and referral services to the
951	department's county health departments and other low-income
952	perinatal providers within the hospital's region, including the
953	development of written agreements between these organizations
954	and the hospital.
955	(h)  Agree to arrange for transportation for high-risk
956	obstetrical patients and neonates in need of transfer from the
957	community to the hospital or from the hospital to another more
958	appropriate facility.
959	(4)  Hospitals which fail to comply with any of the
960	conditions in subsection (3) or the applicable rules of the
961	department and agency shall not receive any payments under this
962	section until full compliance is achieved. A hospital which is
963	not in compliance in two or more consecutive quarters shall not
964	receive its share of the funds. Any forfeited funds shall be
965	distributed by the remaining participating regional perinatal
966	intensive care center program hospitals.
967	Section 15.  Section 409.9113, Florida Statutes, is amended
968	to read:
969	409.9113  Disproportionate share program for teaching
970	hospitals.--In addition to the payments made under ss. 409.911
971	and 409.9112, the Agency for Health Care Administration shall
972	make disproportionate share payments to statutorily defined
973	teaching hospitals for their increased costs associated with
974	medical education programs and for tertiary health care services
975	provided to the indigent. This system of payments shall conform
976	with federal requirements and shall distribute funds in each
977	fiscal year for which an appropriation is made by making
978	quarterly Medicaid payments. Notwithstanding s. 409.915,
979	counties are exempt from contributing toward the cost of this
980	special reimbursement for hospitals serving a disproportionate
981	share of low-income patients. For the state fiscal year 2004-
982	2005, the agency shall not distribute moneys under the teaching
983	hospital disproportionate share program, except as noted in
984	subsection (2). In the event the Centers for Medicare and
985	Medicaid Services do not approve Florida's inpatient hospital
986	state plan amendment for the public disproportionate share
987	program by January 1, 2005, the agency may make payments to
988	hospitals under the teaching hospital disproportionate share
989	program.
990	(1)  On or before September 15 of each year, the Agency for
991	Health Care Administration shall calculate an allocation
992	fraction to be used for distributing funds to state statutory
993	teaching hospitals. Subsequent to the end of each quarter of the
994	state fiscal year, the agency shall distribute to each statutory
995	teaching hospital, as defined in s. 408.07, an amount determined
996	by multiplying one-fourth of the funds appropriated for this
997	purpose by the Legislature times such hospital's allocation
998	fraction. The allocation fraction for each such hospital shall
999	be determined by the sum of three primary factors, divided by
1000	three. The primary factors are:
1001	(a)  The number of nationally accredited graduate medical
1002	education programs offered by the hospital, including programs
1003	accredited by the Accreditation Council for Graduate Medical
1004	Education and the combined Internal Medicine and Pediatrics
1005	programs acceptable to both the American Board of Internal
1006	Medicine and the American Board of Pediatrics at the beginning
1007	of the state fiscal year preceding the date on which the
1008	allocation fraction is calculated. The numerical value of this
1009	factor is the fraction that the hospital represents of the total
1010	number of programs, where the total is computed for all state
1011	statutory teaching hospitals.
1012	(b)  The number of full-time equivalent trainees in the
1013	hospital, which comprises two components:
1014	1.  The number of trainees enrolled in nationally
1015	accredited graduate medical education programs, as defined in
1016	paragraph (a). Full-time equivalents are computed using the
1017	fraction of the year during which each trainee is primarily
1018	assigned to the given institution, over the state fiscal year
1019	preceding the date on which the allocation fraction is
1020	calculated. The numerical value of this factor is the fraction
1021	that the hospital represents of the total number of full-time
1022	equivalent trainees enrolled in accredited graduate programs,
1023	where the total is computed for all state statutory teaching
1024	hospitals.
1025	2.  The number of medical students enrolled in accredited
1026	colleges of medicine and engaged in clinical activities,
1027	including required clinical clerkships and clinical electives.
1028	Full-time equivalents are computed using the fraction of the
1029	year during which each trainee is primarily assigned to the
1030	given institution, over the course of the state fiscal year
1031	preceding the date on which the allocation fraction is
1032	calculated. The numerical value of this factor is the fraction
1033	that the given hospital represents of the total number of full-
1034	time equivalent students enrolled in accredited colleges of
1035	medicine, where the total is computed for all state statutory
1036	teaching hospitals.
1037
1038	The primary factor for full-time equivalent trainees is computed
1039	as the sum of these two components, divided by two.
1040	(c)  A service index that comprises three components:
1041	1.  The Agency for Health Care Administration Service
1042	Index, computed by applying the standard Service Inventory
1043	Scores established by the Agency for Health Care Administration
1044	to services offered by the given hospital, as reported on
1045	Worksheet A-2 for the last fiscal year reported to the agency
1046	before the date on which the allocation fraction is calculated.
1047	The numerical value of this factor is the fraction that the
1048	given hospital represents of the total Agency for Health Care
1049	Administration Service Index values, where the total is computed
1050	for all state statutory teaching hospitals.
1051	2.  A volume-weighted service index, computed by applying
1052	the standard Service Inventory Scores established by the Agency
1053	for Health Care Administration to the volume of each service,
1054	expressed in terms of the standard units of measure reported on
1055	Worksheet A-2 for the last fiscal year reported to the agency
1056	before the date on which the allocation factor is calculated.
1057	The numerical value of this factor is the fraction that the
1058	given hospital represents of the total volume-weighted service
1059	index values, where the total is computed for all state
1060	statutory teaching hospitals.
1061	3.  Total Medicaid payments to each hospital for direct
1062	inpatient and outpatient services during the fiscal year
1063	preceding the date on which the allocation factor is calculated.
1064	This includes payments made to each hospital for such services
1065	by Medicaid prepaid health plans, whether the plan was
1066	administered by the hospital or not. The numerical value of this
1067	factor is the fraction that each hospital represents of the
1068	total of such Medicaid payments, where the total is computed for
1069	all state statutory teaching hospitals.
1070
1071	The primary factor for the service index is computed as the sum
1072	of these three components, divided by three.
1073	(2)  By October 1 of each year, the agency shall use the
1074	following formula to calculate the maximum additional
1075	disproportionate share payment for statutorily defined teaching
1076	hospitals:
1077
1078	TAP = THAF x A
1079
1080	Where:
1081	TAP = total additional payment.
1082	THAF = teaching hospital allocation factor.
1083	A = amount appropriated for a teaching hospital
1084	disproportionate share program.
1085	Section 16.  Section 409.9117, Florida Statutes, is amended
1086	to read:
1087	409.9117  Primary care disproportionate share program.--
1088	For the state fiscal year 2004-2005, the agency shall not
1089	distribute moneys under the primary care disproportionate share
1090	program, except as noted in subsection (2). In the event the
1091	Centers for Medicare and Medicaid Services do not approve
1092	Florida's inpatient hospital state plan amendment for the public
1093	disproportionate share program by January 1, 2005, the agency
1094	may make payments to hospitals under the primary care
1095	disproportionate share program.
1096	(1)  If federal funds are available for disproportionate
1097	share programs in addition to those otherwise provided by law,
1098	there shall be created a primary care disproportionate share
1099	program.
1100	(2)  The following formula shall be used by the agency to
1101	calculate the total amount earned for hospitals that participate
1102	in the primary care disproportionate share program:
1103
1104	TAE = HDSP/THDSP
1105
1106	Where:
1107	TAE = total amount earned by a hospital participating in
1108	the primary care disproportionate share program.
1109	HDSP = the prior state fiscal year primary care
1110	disproportionate share payment to the individual hospital.
1111	THDSP = the prior state fiscal year total primary care
1112	disproportionate share payments to all hospitals.
1113
1114	(3)  The total additional payment for hospitals that
1115	participate in the primary care disproportionate share program
1116	shall be calculated by the agency as follows:
1117
1118	TAP = TAE x TA
1119
1120	Where:
1121	TAP = total additional payment for a primary care hospital.
1122	TAE = total amount earned by a primary care hospital.
1123	TA = total appropriation for the primary care
1124	disproportionate share program.
1125
1126	(4)  In the establishment and funding of this program, the
1127	agency shall use the following criteria in addition to those
1128	specified in s. 409.911, payments may not be made to a hospital
1129	unless the hospital agrees to:
1130	(a)  Cooperate with a Medicaid prepaid health plan, if one
1131	exists in the community.
1132	(b)  Ensure the availability of primary and specialty care
1133	physicians to Medicaid recipients who are not enrolled in a
1134	prepaid capitated arrangement and who are in need of access to
1135	such physicians.
1136	(c)  Coordinate and provide primary care services free of
1137	charge, except copayments, to all persons with incomes up to 100
1138	percent of the federal poverty level who are not otherwise
1139	covered by Medicaid or another program administered by a
1140	governmental entity, and to provide such services based on a
1141	sliding fee scale to all persons with incomes up to 200 percent
1142	of the federal poverty level who are not otherwise covered by
1143	Medicaid or another program administered by a governmental
1144	entity, except that eligibility may be limited to persons who
1145	reside within a more limited area, as agreed to by the agency
1146	and the hospital.
1147	(d)  Contract with any federally qualified health center,
1148	if one exists within the agreed geopolitical boundaries,
1149	concerning the provision of primary care services, in order to
1150	guarantee delivery of services in a nonduplicative fashion, and
1151	to provide for referral arrangements, privileges, and
1152	admissions, as appropriate. The hospital shall agree to provide
1153	at an onsite or offsite facility primary care services within 24
1154	hours to which all Medicaid recipients and persons eligible
1155	under this paragraph who do not require emergency room services
1156	are referred during normal daylight hours.
1157	(e)  Cooperate with the agency, the county, and other
1158	entities to ensure the provision of certain public health
1159	services, case management, referral and acceptance of patients,
1160	and sharing of epidemiological data, as the agency and the
1161	hospital find mutually necessary and desirable to promote and
1162	protect the public health within the agreed geopolitical
1163	boundaries.
1164	(f)  In cooperation with the county in which the hospital
1165	resides, develop a low-cost, outpatient, prepaid health care
1166	program to persons who are not eligible for the Medicaid
1167	program, and who reside within the area.
1168	(g)  Provide inpatient services to residents within the
1169	area who are not eligible for Medicaid or Medicare, and who do
1170	not have private health insurance, regardless of ability to pay,
1171	on the basis of available space, except that nothing shall
1172	prevent the hospital from establishing bill collection programs
1173	based on ability to pay.
1174	(h)  Work with the Florida Healthy Kids Corporation, the
1175	Florida Health Care Purchasing Cooperative, and business health
1176	coalitions, as appropriate, to develop a feasibility study and
1177	plan to provide a low-cost comprehensive health insurance plan
1178	to persons who reside within the area and who do not have access
1179	to such a plan.
1180	(i)  Work with public health officials and other experts to
1181	provide community health education and prevention activities
1182	designed to promote healthy lifestyles and appropriate use of
1183	health services.
1184	(j)  Work with the local health council to develop a plan
1185	for promoting access to affordable health care services for all
1186	persons who reside within the area, including, but not limited
1187	to, public health services, primary care services, inpatient
1188	services, and affordable health insurance generally.
1189
1190	Any hospital that fails to comply with any of the provisions of
1191	this subsection, or any other contractual condition, may not
1192	receive payments under this section until full compliance is
1193	achieved.
1194	Section 17.  Section 409.912, Florida Statutes, is amended
1195	to read:
1196	409.912  Cost-effective purchasing of health care.--The
1197	agency shall purchase goods and services for Medicaid recipients
1198	in the most cost-effective manner consistent with the delivery
1199	of quality medical care. The agency shall maximize the use of
1200	prepaid per capita and prepaid aggregate fixed-sum basis
1201	services when appropriate and other alternative service delivery
1202	and reimbursement methodologies, including competitive bidding
1203	pursuant to s. 287.057, designed to facilitate the cost-
1204	effective purchase of a case-managed continuum of care. The
1205	agency shall also require providers to minimize the exposure of
1206	recipients to the need for acute inpatient, custodial, and other
1207	institutional care and the inappropriate or unnecessary use of
1208	high-cost services. The agency may establish prior authorization
1209	requirements for certain populations of Medicaid beneficiaries,
1210	certain drug classes, or particular drugs to prevent fraud,
1211	abuse, overuse, and possible dangerous drug interactions. The
1212	Pharmaceutical and Therapeutics Committee shall make
1213	recommendations to the agency on drugs for which prior
1214	authorization is required. The agency shall inform the
1215	Pharmaceutical and Therapeutics Committee of its decisions
1216	regarding drugs subject to prior authorization. The agency is
1217	authorized to limit the entities it contracts with or enrolls as
1218	Medicaid providers by developing a provider network through
1219	provider credentialing. The agency may limit its network based
1220	on the assessment of beneficiary access to care, provider
1221	availability, provider quality standards, time and distance
1222	standards for access to care, the cultural competence of the
1223	provider network, demographic characteristics of Medicaid
1224	beneficiaries, practice and provider-to-beneficiary standards,
1225	appointment wait times, beneficiary use of services, provider
1226	turnover, provider profiling, provider licensure history,
1227	previous program integrity investigations and findings, peer
1228	review, provider Medicaid policy and billing compliance record,
1229	clinical and medical record audits, and other factors. Providers
1230	shall not be entitled to enrollment in the Medicaid provider
1231	network. The agency is authorized to seek federal waivers
1232	necessary to implement this policy.
1233	(1)  The agency shall work with the Department of Children
1234	and Family Services to ensure access of children and families in
1235	the child protection system to needed and appropriate mental
1236	health and substance abuse services.
1237	(2)  The agency may enter into agreements with appropriate
1238	agents of other state agencies or of any agency of the Federal
1239	Government and accept such duties in respect to social welfare
1240	or public aid as may be necessary to implement the provisions of
1241	Title XIX of the Social Security Act and ss. 409.901-409.920.
1242	(3)  The agency may contract with health maintenance
1243	organizations certified pursuant to part I of chapter 641 for
1244	the provision of services to recipients.
1245	(4)  The agency may contract with:
1246	(a)  An entity that provides no prepaid health care
1247	services other than Medicaid services under contract with the
1248	agency and which is owned and operated by a county, county
1249	health department, or county-owned and operated hospital to
1250	provide health care services on a prepaid or fixed-sum basis to
1251	recipients, which entity may provide such prepaid services
1252	either directly or through arrangements with other providers.
1253	Such prepaid health care services entities must be licensed
1254	under parts I and III by January 1, 1998, and until then are
1255	exempt from the provisions of part I of chapter 641. An entity
1256	recognized under this paragraph which demonstrates to the
1257	satisfaction of the Office of Insurance Regulation of the
1258	Financial Services Commission that it is backed by the full
1259	faith and credit of the county in which it is located may be
1260	exempted from s. 641.225.
1261	(b)  An entity that is providing comprehensive behavioral
1262	health care services to certain Medicaid recipients through a
1263	capitated, prepaid arrangement pursuant to the federal waiver
1264	provided for by s. 409.905(5). Such an entity must be licensed
1265	under chapter 624, chapter 636, or chapter 641 and must possess
1266	the clinical systems and operational competence to manage risk
1267	and provide comprehensive behavioral health care to Medicaid
1268	recipients. As used in this paragraph, the term "comprehensive
1269	behavioral health care services" means covered mental health and
1270	substance abuse treatment services that are available to
1271	Medicaid recipients. The secretary of the Department of Children
1272	and Family Services shall approve provisions of procurements
1273	related to children in the department's care or custody prior to
1274	enrolling such children in a prepaid behavioral health plan. Any
1275	contract awarded under this paragraph must be competitively
1276	procured. In developing the behavioral health care prepaid plan
1277	procurement document, the agency shall ensure that the
1278	procurement document requires the contractor to develop and
1279	implement a plan to ensure compliance with s. 394.4574 related
1280	to services provided to residents of licensed assisted living
1281	facilities that hold a limited mental health license. Except as
1282	provided in subparagraph 8., the agency shall seek federal
1283	approval to contract with a single entity meeting these
1284	requirements to provide comprehensive behavioral health care
1285	services to all Medicaid recipients not enrolled in a managed
1286	care plan in an AHCA area. Each entity must offer sufficient
1287	choice of providers in its network to ensure recipient access to
1288	care and the opportunity to select a provider with whom they are
1289	satisfied. The network shall include all public mental health
1290	hospitals. To ensure unimpaired access to behavioral health care
1291	services by Medicaid recipients, all contracts issued pursuant
1292	to this paragraph shall require 80 percent of the capitation
1293	paid to the managed care plan, including health maintenance
1294	organizations, to be expended for the provision of behavioral
1295	health care services. In the event the managed care plan expends
1296	less than 80 percent of the capitation paid pursuant to this
1297	paragraph for the provision of behavioral health care services,
1298	the difference shall be returned to the agency. The agency shall
1299	provide the managed care plan with a certification letter
1300	indicating the amount of capitation paid during each calendar
1301	year for the provision of behavioral health care services
1302	pursuant to this section. The agency may reimburse for substance
1303	abuse treatment services on a fee-for-service basis until the
1304	agency finds that adequate funds are available for capitated,
1305	prepaid arrangements.
1306	1.  By January 1, 2001, the agency shall modify the
1307	contracts with the entities providing comprehensive inpatient
1308	and outpatient mental health care services to Medicaid
1309	recipients in Hillsborough, Highlands, Hardee, Manatee, and Polk
1310	Counties, to include substance abuse treatment services.
1311	2.  By July 1, 2003, the agency and the Department of
1312	Children and Family Services shall execute a written agreement
1313	that requires collaboration and joint development of all policy,
1314	budgets, procurement documents, contracts, and monitoring plans
1315	that have an impact on the state and Medicaid community mental
1316	health and targeted case management programs.
1317	3.  Except as provided in subparagraph 8., by July 1, 2006,
1318	the agency and the Department of Children and Family Services
1319	shall contract with managed care entities in each AHCA area
1320	except area 6 or arrange to provide comprehensive inpatient and
1321	outpatient mental health and substance abuse services through
1322	capitated prepaid arrangements to all Medicaid recipients who
1323	are eligible to participate in such plans under federal law and
1324	regulation. In AHCA areas where eligible individuals number less
1325	than 150,000, the agency shall contract with a single managed
1326	care plan to provide comprehensive behavioral health services to
1327	all recipients who are not enrolled in a Medicaid health
1328	maintenance organization. The agency may contract with more than
1329	one comprehensive behavioral health provider to provide care to
1330	recipients who are not enrolled in a Medicaid health maintenance
1331	organization plan in AHCA areas where the eligible population
1332	exceeds 150,000. Contracts for comprehensive behavioral health
1333	providers awarded pursuant to this section shall be
1334	competitively procured. Both for-profit and not-for-profit
1335	corporations shall be eligible to compete. Managed care plans
1336	contracting with the agency under subsection (3) shall provide
1337	and receive payment for the same comprehensive behavioral health
1338	benefits as provided in AHCA rules, including handbooks
1339	incorporated by reference.
1340	4.  By October 1, 2003, the agency and the department shall
1341	submit a plan to the Governor, the President of the Senate, and
1342	the Speaker of the House of Representatives which provides for
1343	the full implementation of capitated prepaid behavioral health
1344	care in all areas of the state. The plan shall include
1345	provisions which ensure that children and families receiving
1346	foster care and other related services are appropriately served
1347	and that these services assist the community-based care lead
1348	agencies in meeting the goals and outcomes of the child welfare
1349	system. The plan will be developed with the participation of
1350	community-based lead agencies, community alliances, sheriffs,
1351	and community providers serving dependent children.
1352	a.  Implementation shall begin in 2003 in those AHCA areas
1353	of the state where the agency is able to establish sufficient
1354	capitation rates.
1355	b.  If the agency determines that the proposed capitation
1356	rate in any area is insufficient to provide appropriate
1357	services, the agency may adjust the capitation rate to ensure
1358	that care will be available. The agency and the department may
1359	use existing general revenue to address any additional required
1360	match but may not over-obligate existing funds on an annualized
1361	basis.
1362	c.  Subject to any limitations provided for in the General
1363	Appropriations Act, the agency, in compliance with appropriate
1364	federal authorization, shall develop policies and procedures
1365	that allow for certification of local and state funds.
1366	5.  Children residing in a statewide inpatient psychiatric
1367	program, or in a Department of Juvenile Justice or a Department
1368	of Children and Family Services residential program approved as
1369	a Medicaid behavioral health overlay services provider shall not
1370	be included in a behavioral health care prepaid health plan or
1371	any other Medicaid managed care plan pursuant to this paragraph.
1372	6.  In converting to a prepaid system of delivery, the
1373	agency shall in its procurement document require an entity
1374	providing only comprehensive behavioral health care services to
1375	prevent the displacement of indigent care patients by enrollees
1376	in the Medicaid prepaid health plan providing behavioral health
1377	care services from facilities receiving state funding to provide
1378	indigent behavioral health care, to facilities licensed under
1379	chapter 395 which do not receive state funding for indigent
1380	behavioral health care, or reimburse the unsubsidized facility
1381	for the cost of behavioral health care provided to the displaced
1382	indigent care patient.
1383	7.  Traditional community mental health providers under
1384	contract with the Department of Children and Family Services
1385	pursuant to part IV of chapter 394, child welfare providers
1386	under contract with the Department of Children and Family
1387	Services in areas 1 and 6, and inpatient mental health providers
1388	licensed pursuant to chapter 395 must be offered an opportunity
1389	to accept or decline a contract to participate in any provider
1390	network for prepaid behavioral health services.
1391	8.  For fiscal year 2004-2005, all Medicaid eligible
1392	children, except children in areas 1 and 6, whose cases are open
1393	for child welfare services in the HomeSafeNet system, shall be
1394	enrolled in MediPass or in Medicaid fee-for-service and all
1395	their behavioral health care services including inpatient,
1396	outpatient psychiatric, community mental health, and case
1397	management shall be reimbursed on a fee-for-service basis.
1398	Beginning July 1, 2005, such children, who are open for child
1399	welfare services in the HomeSafeNet system, shall receive their
1400	behavioral health care services through a specialty prepaid plan
1401	operated by community-based lead agencies either through a
1402	single agency or formal agreements among several agencies. The
1403	specialty prepaid plan must result in savings to the state
1404	comparable to savings achieved in other Medicaid managed care
1405	and prepaid programs. Such plan must provide mechanisms to
1406	maximize state and local revenues. The specialty prepaid plan
1407	shall be developed by the agency and The Department of Children
1408	and Family Services. The agency is authorized to seek any
1409	federal waivers to implement this initiative.
1410	(c)  A federally qualified health center or an entity owned
1411	by one or more federally qualified health centers or an entity
1412	owned by other migrant and community health centers receiving
1413	non-Medicaid financial support from the Federal Government to
1414	provide health care services on a prepaid or fixed-sum basis to
1415	recipients. Such prepaid health care services entity must be
1416	licensed under parts I and III of chapter 641, but shall be
1417	prohibited from serving Medicaid recipients on a prepaid basis,
1418	until such licensure has been obtained. However, such an entity
1419	is exempt from s. 641.225 if the entity meets the requirements
1420	specified in subsections (17) (15) and (18) (16).
1421	(d)  A provider service network may be reimbursed on a fee-
1422	for-service or prepaid basis. A provider service network which
1423	is reimbursed by the agency on a prepaid basis shall be exempt
1424	from parts I and III of chapter 641, but must meet appropriate
1425	financial reserve, quality assurance, and patient rights
1426	requirements as established by the agency. The agency shall
1427	award contracts on a competitive bid basis and shall select
1428	bidders based upon price and quality of care. Medicaid
1429	recipients assigned to a demonstration project shall be chosen
1430	equally from those who would otherwise have been assigned to
1431	prepaid plans and MediPass. The agency is authorized to seek
1432	federal Medicaid waivers as necessary to implement the
1433	provisions of this section.
1434	(e)  An entity that provides only comprehensive behavioral
1435	health care services to certain Medicaid recipients through an
1436	administrative services organization agreement. Such an entity
1437	must possess the clinical systems and operational competence to
1438	provide comprehensive health care to Medicaid recipients. As
1439	used in this paragraph, the term "comprehensive behavioral
1440	health care services" means covered mental health and substance
1441	abuse treatment services that are available to Medicaid
1442	recipients. Any contract awarded under this paragraph must be
1443	competitively procured. The agency must ensure that Medicaid
1444	recipients have available the choice of at least two managed
1445	care plans for their behavioral health care services.
1446	(f)  An entity that provides in-home physician services to
1447	test the cost-effectiveness of enhanced home-based medical care
1448	to Medicaid recipients with degenerative neurological diseases
1449	and other diseases or disabling conditions associated with high
1450	costs to Medicaid. The program shall be designed to serve very
1451	disabled persons and to reduce Medicaid reimbursed costs for
1452	inpatient, outpatient, and emergency department services. The
1453	agency shall contract with vendors on a risk-sharing basis.
1454	(g)  Children's provider networks that provide care
1455	coordination and care management for Medicaid-eligible pediatric
1456	patients, primary care, authorization of specialty care, and
1457	other urgent and emergency care through organized providers
1458	designed to service Medicaid eligibles under age 18 and
1459	pediatric emergency departments' diversion programs. The
1460	networks shall provide after-hour operations, including evening
1461	and weekend hours, to promote, when appropriate, the use of the
1462	children's networks rather than hospital emergency departments.
1463	(h)  An entity authorized in s. 430.205 to contract with
1464	the agency and the Department of Elderly Affairs to provide
1465	health care and social services on a prepaid or fixed-sum basis
1466	to elderly recipients. Such prepaid health care services
1467	entities are exempt from the provisions of part I of chapter 641
1468	for the first 3 years of operation. An entity recognized under
1469	this paragraph that demonstrates to the satisfaction of the
1470	Office of Insurance Regulation that it is backed by the full
1471	faith and credit of one or more counties in which it operates
1472	may be exempted from s. 641.225.
1473	(i)  A Children's Medical Services network, as defined in
1474	s. 391.021.
1475	(5)  By October 1, 2003, the agency and the department
1476	shall, to the extent feasible, develop a plan for implementing
1477	new Medicaid procedure codes for emergency and crisis care,
1478	supportive residential services, and other services designed to
1479	maximize the use of Medicaid funds for Medicaid-eligible
1480	recipients. The agency shall include in the agreement developed
1481	pursuant to subsection (4) a provision that ensures that the
1482	match requirements for these new procedure codes are met by
1483	certifying eligible general revenue or local funds that are
1484	currently expended on these services by the department with
1485	contracted alcohol, drug abuse, and mental health providers. The
1486	plan must describe specific procedure codes to be implemented, a
1487	projection of the number of procedures to be delivered during
1488	fiscal year 2003-2004, and a financial analysis that describes
1489	the certified match procedures, and accountability mechanisms,
1490	projects the earnings associated with these procedures, and
1491	describes the sources of state match. This plan may not be
1492	implemented in any part until approved by the Legislative Budget
1493	Commission. If such approval has not occurred by December 31,
1494	2003, the plan shall be submitted for consideration by the 2004
1495	Legislature.
1496	(6)  The agency may contract with any public or private
1497	entity otherwise authorized by this section on a prepaid or
1498	fixed-sum basis for the provision of health care services to
1499	recipients. An entity may provide prepaid services to
1500	recipients, either directly or through arrangements with other
1501	entities, if each entity involved in providing services:
1502	(a)  Is organized primarily for the purpose of providing
1503	health care or other services of the type regularly offered to
1504	Medicaid recipients;
1505	(b)  Ensures that services meet the standards set by the
1506	agency for quality, appropriateness, and timeliness;
1507	(c)  Makes provisions satisfactory to the agency for
1508	insolvency protection and ensures that neither enrolled Medicaid
1509	recipients nor the agency will be liable for the debts of the
1510	entity;
1511	(d)  Submits to the agency, if a private entity, a
1512	financial plan that the agency finds to be fiscally sound and
1513	that provides for working capital in the form of cash or
1514	equivalent liquid assets excluding revenues from Medicaid
1515	premium payments equal to at least the first 3 months of
1516	operating expenses or $200,000, whichever is greater;
1517	(e)  Furnishes evidence satisfactory to the agency of
1518	adequate liability insurance coverage or an adequate plan of
1519	self-insurance to respond to claims for injuries arising out of
1520	the furnishing of health care;
1521	(f)  Provides, through contract or otherwise, for periodic
1522	review of its medical facilities and services, as required by
1523	the agency; and
1524	(g)  Provides organizational, operational, financial, and
1525	other information required by the agency.
1526	(7)  The agency may contract on a prepaid or fixed-sum
1527	basis with any health insurer that:
1528	(a)  Pays for health care services provided to enrolled
1529	Medicaid recipients in exchange for a premium payment paid by
1530	the agency;
1531	(b)  Assumes the underwriting risk; and
1532	(c)  Is organized and licensed under applicable provisions
1533	of the Florida Insurance Code and is currently in good standing
1534	with the Office of Insurance Regulation.
1535	(8)  The agency may contract on a prepaid or fixed-sum
1536	basis with an exclusive provider organization to provide health
1537	care services to Medicaid recipients provided that the exclusive
1538	provider organization meets applicable managed care plan
1539	requirements in this section, ss. 409.9122, 409.9123, 409.9128,
1540	and 627.6472, and other applicable provisions of law.
1541	(9)  The Agency for Health Care Administration may provide
1542	cost-effective purchasing of chiropractic services on a fee-for-
1543	service basis to Medicaid recipients through arrangements with a
1544	statewide chiropractic preferred provider organization
1545	incorporated in this state as a not-for-profit corporation. The
1546	agency shall ensure that the benefit limits and prior
1547	authorization requirements in the current Medicaid program shall
1548	apply to the services provided by the chiropractic preferred
1549	provider organization.
1550	(10)  The agency shall not contract on a prepaid or fixed-
1551	sum basis for Medicaid services with an entity which knows or
1552	reasonably should know that any officer, director, agent,
1553	managing employee, or owner of stock or beneficial interest in
1554	excess of 5 percent common or preferred stock, or the entity
1555	itself, has been found guilty of, regardless of adjudication, or
1556	entered a plea of nolo contendere, or guilty, to:
1557	(a)  Fraud;
1558	(b)  Violation of federal or state antitrust statutes,
1559	including those proscribing price fixing between competitors and
1560	the allocation of customers among competitors;
1561	(c)  Commission of a felony involving embezzlement, theft,
1562	forgery, income tax evasion, bribery, falsification or
1563	destruction of records, making false statements, receiving
1564	stolen property, making false claims, or obstruction of justice;
1565	or
1566	(d)  Any crime in any jurisdiction which directly relates
1567	to the provision of health services on a prepaid or fixed-sum
1568	basis.
1569	(11)  The agency, after notifying the Legislature, may
1570	apply for waivers of applicable federal laws and regulations as
1571	necessary to implement more appropriate systems of health care
1572	for Medicaid recipients and reduce the cost of the Medicaid
1573	program to the state and federal governments and shall implement
1574	such programs, after legislative approval, within a reasonable
1575	period of time after federal approval. These programs must be
1576	designed primarily to reduce the need for inpatient care,
1577	custodial care and other long-term or institutional care, and
1578	other high-cost services.
1579	(a)  Prior to seeking legislative approval of such a waiver
1580	as authorized by this subsection, the agency shall provide
1581	notice and an opportunity for public comment. Notice shall be
1582	provided to all persons who have made requests of the agency for
1583	advance notice and shall be published in the Florida
1584	Administrative Weekly not less than 28 days prior to the
1585	intended action.
1586	(b)  Notwithstanding s. 216.292, funds that are
1587	appropriated to the Department of Elderly Affairs for the
1588	Assisted Living for the Elderly Medicaid waiver and are not
1589	expended shall be transferred to the agency to fund Medicaid-
1590	reimbursed nursing home care.
1591	(12)  The agency shall establish a postpayment utilization
1592	control program designed to identify recipients who may
1593	inappropriately overuse or underuse Medicaid services and shall
1594	provide methods to correct such misuse.
1595	(13)  The agency shall develop and provide coordinated
1596	systems of care for Medicaid recipients and may contract with
1597	public or private entities to develop and administer such
1598	systems of care among public and private health care providers
1599	in a given geographic area.
1600	(14)  The agency shall operate or contract for the
1601	operation of utilization management and incentive systems
1602	designed to encourage cost-effective use services.
1603	(15)(a)  The agency shall operate the Comprehensive
1604	Assessment and Review (CARES) nursing facility preadmission
1605	screening program to ensure that Medicaid payment for nursing
1606	facility care is made only for individuals whose conditions
1607	require such care and to ensure that long-term care services are
1608	provided in the setting most appropriate to the needs of the
1609	person and in the most economical manner possible. The CARES
1610	program shall also ensure that individuals participating in
1611	Medicaid home and community-based waiver programs meet criteria
1612	for those programs, consistent with approved federal waivers.
1613	(b)  The agency shall operate the CARES program through an
1614	interagency agreement with the Department of Elderly Affairs.
1615	(c)  Prior to making payment for nursing facility services
1616	for a Medicaid recipient, the agency must verify that the
1617	nursing facility preadmission screening program has determined
1618	that the individual requires nursing facility care and that the
1619	individual cannot be safely served in community-based programs.
1620	The nursing facility preadmission screening program shall refer
1621	a Medicaid recipient to a community-based program if the
1622	individual could be safely served at a lower cost and the
1623	recipient chooses to participate in such program.
1624	(d)  By January 1 of each year, the agency shall submit a
1625	report to the Legislature and the Office of Long-Term-Care
1626	Policy describing the operations of the CARES program. The
1627	report must describe:
1628	1.  Rate of diversion to community alternative programs;
1629	2.  CARES program staffing needs to achieve additional
1630	diversions;
1631	3.  Reasons the program is unable to place individuals in
1632	less restrictive settings when such individuals desired such
1633	services and could have been served in such settings;
1634	4.  Barriers to appropriate placement, including barriers
1635	due to policies or operations of other agencies or state-funded
1636	programs; and
1637	5.  Statutory changes necessary to ensure that individuals
1638	in need of long-term care services receive care in the least
1639	restrictive environment.
1640	(16)(a)  The agency shall identify health care utilization
1641	and price patterns within the Medicaid program which are not
1642	cost-effective or medically appropriate and assess the
1643	effectiveness of new or alternate methods of providing and
1644	monitoring service, and may implement such methods as it
1645	considers appropriate. Such methods may include disease
1646	management initiatives, an integrated and systematic approach
1647	for managing the health care needs of recipients who are at risk
1648	of or diagnosed with a specific disease by using best practices,
1649	prevention strategies, clinical-practice improvement, clinical
1650	interventions and protocols, outcomes research, information
1651	technology, and other tools and resources to reduce overall
1652	costs and improve measurable outcomes.
1653	(b)  The responsibility of the agency under this subsection
1654	shall include the development of capabilities to identify actual
1655	and optimal practice patterns; patient and provider educational
1656	initiatives; methods for determining patient compliance with
1657	prescribed treatments; fraud, waste, and abuse prevention and
1658	detection programs; and beneficiary case management programs.
1659	1.  The practice pattern identification program shall
1660	evaluate practitioner prescribing patterns based on national and
1661	regional practice guidelines, comparing practitioners to their
1662	peer groups. The agency and its Drug Utilization Review Board
1663	shall consult with a panel of practicing health care
1664	professionals consisting of the following: the Speaker of the
1665	House of Representatives and the President of the Senate shall
1666	each appoint three physicians licensed under chapter 458 or
1667	chapter 459; and the Governor shall appoint two pharmacists
1668	licensed under chapter 465 and one dentist licensed under
1669	chapter 466 who is an oral surgeon. Terms of the panel members
1670	shall expire at the discretion of the appointing official. The
1671	panel shall begin its work by August 1, 1999, regardless of the
1672	number of appointments made by that date. The advisory panel
1673	shall be responsible for evaluating treatment guidelines and
1674	recommending ways to incorporate their use in the practice
1675	pattern identification program. Practitioners who are
1676	prescribing inappropriately or inefficiently, as determined by
1677	the agency, may have their prescribing of certain drugs subject
1678	to prior authorization.
1679	2.  The agency shall also develop educational interventions
1680	designed to promote the proper use of medications by providers
1681	and beneficiaries.
1682	3.  The agency shall implement a pharmacy fraud, waste, and
1683	abuse initiative that may include a surety bond or letter of
1684	credit requirement for participating pharmacies, enhanced
1685	provider auditing practices, the use of additional fraud and
1686	abuse software, recipient management programs for beneficiaries
1687	inappropriately using their benefits, and other steps that will
1688	eliminate provider and recipient fraud, waste, and abuse. The
1689	initiative shall address enforcement efforts to reduce the
1690	number and use of counterfeit prescriptions.
1691	4.  By September 30, 2002, the agency shall contract with
1692	an entity in the state to implement a wireless handheld clinical
1693	pharmacology drug information database for practitioners. The
1694	initiative shall be designed to enhance the agency's efforts to
1695	reduce fraud, abuse, and errors in the prescription drug benefit
1696	program and to otherwise further the intent of this paragraph.
1697	5.  The agency may apply for any federal waivers needed to
1698	implement this paragraph.
1699	(17)  An entity contracting on a prepaid or fixed-sum basis
1700	shall, in addition to meeting any applicable statutory surplus
1701	requirements, also maintain at all times in the form of cash,
1702	investments that mature in less than 180 days allowable as
1703	admitted assets by the Office of Insurance Regulation, and
1704	restricted funds or deposits controlled by the agency or the
1705	Office of Insurance Regulation, a surplus amount equal to one-
1706	and-one-half times the entity's monthly Medicaid prepaid
1707	revenues. As used in this subsection, the term "surplus" means
1708	the entity's total assets minus total liabilities. If an
1709	entity's surplus falls below an amount equal to one-and-one-half
1710	times the entity's monthly Medicaid prepaid revenues, the agency
1711	shall prohibit the entity from engaging in marketing and
1712	preenrollment activities, shall cease to process new
1713	enrollments, and shall not renew the entity's contract until the
1714	required balance is achieved. The requirements of this
1715	subsection do not apply:
1716	(a)  Where a public entity agrees to fund any deficit
1717	incurred by the contracting entity; or
1718	(b)  Where the entity's performance and obligations are
1719	guaranteed in writing by a guaranteeing organization which:
1720	1.  Has been in operation for at least 5 years and has
1721	assets in excess of $50 million; or
1722	2.  Submits a written guarantee acceptable to the agency
1723	which is irrevocable during the term of the contracting entity's
1724	contract with the agency and, upon termination of the contract,
1725	until the agency receives proof of satisfaction of all
1726	outstanding obligations incurred under the contract.
1727	(18)(a)  The agency may require an entity contracting on a
1728	prepaid or fixed-sum basis to establish a restricted insolvency
1729	protection account with a federally guaranteed financial
1730	institution licensed to do business in this state. The entity
1731	shall deposit into that account 5 percent of the capitation
1732	payments made by the agency each month until a maximum total of
1733	2 percent of the total current contract amount is reached. The
1734	restricted insolvency protection account may be drawn upon with
1735	the authorized signatures of two persons designated by the
1736	entity and two representatives of the agency. If the agency
1737	finds that the entity is insolvent, the agency may draw upon the
1738	account solely with the two authorized signatures of
1739	representatives of the agency, and the funds may be disbursed to
1740	meet financial obligations incurred by the entity under the
1741	prepaid contract. If the contract is terminated, expired, or not
1742	continued, the account balance must be released by the agency to
1743	the entity upon receipt of proof of satisfaction of all
1744	outstanding obligations incurred under this contract.
1745	(b)  The agency may waive the insolvency protection account
1746	requirement in writing when evidence is on file with the agency
1747	of adequate insolvency insurance and reinsurance that will
1748	protect enrollees if the entity becomes unable to meet its
1749	obligations.
1750	(19)  An entity that contracts with the agency on a prepaid
1751	or fixed-sum basis for the provision of Medicaid services shall
1752	reimburse any hospital or physician that is outside the entity's
1753	authorized geographic service area as specified in its contract
1754	with the agency, and that provides services authorized by the
1755	entity to its members, at a rate negotiated with the hospital or
1756	physician for the provision of services or according to the
1757	lesser of the following:
1758	(a)  The usual and customary charges made to the general
1759	public by the hospital or physician; or
1760	(b)  The Florida Medicaid reimbursement rate established
1761	for the hospital or physician.
1762	(20)  When a merger or acquisition of a Medicaid prepaid
1763	contractor has been approved by the Office of Insurance
1764	Regulation pursuant to s. 628.4615, the agency shall approve the
1765	assignment or transfer of the appropriate Medicaid prepaid
1766	contract upon request of the surviving entity of the merger or
1767	acquisition if the contractor and the other entity have been in
1768	good standing with the agency for the most recent 12-month
1769	period, unless the agency determines that the assignment or
1770	transfer would be detrimental to the Medicaid recipients or the
1771	Medicaid program. To be in good standing, an entity must not
1772	have failed accreditation or committed any material violation of
1773	the requirements of s. 641.52 and must meet the Medicaid
1774	contract requirements. For purposes of this section, a merger or
1775	acquisition means a change in controlling interest of an entity,
1776	including an asset or stock purchase.
1777	(21)  Any entity contracting with the agency pursuant to
1778	this section to provide health care services to Medicaid
1779	recipients is prohibited from engaging in any of the following
1780	practices or activities:
1781	(a)  Practices that are discriminatory, including, but not
1782	limited to, attempts to discourage participation on the basis of
1783	actual or perceived health status.
1784	(b)  Activities that could mislead or confuse recipients,
1785	or misrepresent the organization, its marketing representatives,
1786	or the agency. Violations of this paragraph include, but are not
1787	limited to:
1788	1.  False or misleading claims that marketing
1789	representatives are employees or representatives of the state or
1790	county, or of anyone other than the entity or the organization
1791	by whom they are reimbursed.
1792	2.  False or misleading claims that the entity is
1793	recommended or endorsed by any state or county agency, or by any
1794	other organization which has not certified its endorsement in
1795	writing to the entity.
1796	3.  False or misleading claims that the state or county
1797	recommends that a Medicaid recipient enroll with an entity.
1798	4.  Claims that a Medicaid recipient will lose benefits
1799	under the Medicaid program, or any other health or welfare
1800	benefits to which the recipient is legally entitled, if the
1801	recipient does not enroll with the entity.
1802	(c)  Granting or offering of any monetary or other valuable
1803	consideration for enrollment, except as authorized by subsection
1804	(24) (22).
1805	(d)  Door-to-door solicitation of recipients who have not
1806	contacted the entity or who have not invited the entity to make
1807	a presentation.
1808	(e)  Solicitation of Medicaid recipients by marketing
1809	representatives stationed in state offices unless approved and
1810	supervised by the agency or its agent and approved by the
1811	affected state agency when solicitation occurs in an office of
1812	the state agency. The agency shall ensure that marketing
1813	representatives stationed in state offices shall market their
1814	managed care plans to Medicaid recipients only in designated
1815	areas and in such a way as to not interfere with the recipients'
1816	activities in the state office.
1817	(f)  Enrollment of Medicaid recipients.
1818	(22)  The agency may impose a fine for a violation of this
1819	section or the contract with the agency by a person or entity
1820	that is under contract with the agency. With respect to any
1821	nonwillful violation, such fine shall not exceed $2,500 per
1822	violation. In no event shall such fine exceed an aggregate
1823	amount of $10,000 for all nonwillful violations arising out of
1824	the same action. With respect to any knowing and willful
1825	violation of this section or the contract with the agency, the
1826	agency may impose a fine upon the entity in an amount not to
1827	exceed $20,000 for each such violation. In no event shall such
1828	fine exceed an aggregate amount of $100,000 for all knowing and
1829	willful violations arising out of the same action.
1830	(23)  A health maintenance organization or a person or
1831	entity exempt from chapter 641 that is under contract with the
1832	agency for the provision of health care services to Medicaid
1833	recipients may not use or distribute marketing materials used to
1834	solicit Medicaid recipients, unless such materials have been
1835	approved by the agency. The provisions of this subsection do not
1836	apply to general advertising and marketing materials used by a
1837	health maintenance organization to solicit both non-Medicaid
1838	subscribers and Medicaid recipients.
1839	(24)  Upon approval by the agency, health maintenance
1840	organizations and persons or entities exempt from chapter 641
1841	that are under contract with the agency for the provision of
1842	health care services to Medicaid recipients may be permitted
1843	within the capitation rate to provide additional health benefits
1844	that the agency has found are of high quality, are practicably
1845	available, provide reasonable value to the recipient, and are
1846	provided at no additional cost to the state.
1847	(25)  The agency shall utilize the statewide health
1848	maintenance organization complaint hotline for the purpose of
1849	investigating and resolving Medicaid and prepaid health plan
1850	complaints, maintaining a record of complaints and confirmed
1851	problems, and receiving disenrollment requests made by
1852	recipients.
1853	(26)  The agency shall require the publication of the
1854	health maintenance organization's and the prepaid health plan's
1855	consumer services telephone numbers and the "800" telephone
1856	number of the statewide health maintenance organization
1857	complaint hotline on each Medicaid identification card issued by
1858	a health maintenance organization or prepaid health plan
1859	contracting with the agency to serve Medicaid recipients and on
1860	each subscriber handbook issued to a Medicaid recipient.
1861	(27)  The agency shall establish a health care quality
1862	improvement system for those entities contracting with the
1863	agency pursuant to this section, incorporating all the standards
1864	and guidelines developed by the Medicaid Bureau of the Health
1865	Care Financing Administration as a part of the quality assurance
1866	reform initiative. The system shall include, but need not be
1867	limited to, the following:
1868	(a)  Guidelines for internal quality assurance programs,
1869	including standards for:
1870	1.  Written quality assurance program descriptions.
1871	2.  Responsibilities of the governing body for monitoring,
1872	evaluating, and making improvements to care.
1873	3.  An active quality assurance committee.
1874	4.  Quality assurance program supervision.
1875	5.  Requiring the program to have adequate resources to
1876	effectively carry out its specified activities.
1877	6.  Provider participation in the quality assurance
1878	program.
1879	7.  Delegation of quality assurance program activities.
1880	8.  Credentialing and recredentialing.
1881	9.  Enrollee rights and responsibilities.
1882	10.  Availability and accessibility to services and care.
1883	11.  Ambulatory care facilities.
1884	12.  Accessibility and availability of medical records, as
1885	well as proper recordkeeping and process for record review.
1886	13.  Utilization review.
1887	14.  A continuity of care system.
1888	15.  Quality assurance program documentation.
1889	16.  Coordination of quality assurance activity with other
1890	management activity.
1891	17.  Delivering care to pregnant women and infants; to
1892	elderly and disabled recipients, especially those who are at
1893	risk of institutional placement; to persons with developmental
1894	disabilities; and to adults who have chronic, high-cost medical
1895	conditions.
1896	(b)  Guidelines which require the entities to conduct
1897	quality-of-care studies which:
1898	1.  Target specific conditions and specific health service
1899	delivery issues for focused monitoring and evaluation.
1900	2.  Use clinical care standards or practice guidelines to
1901	objectively evaluate the care the entity delivers or fails to
1902	deliver for the targeted clinical conditions and health services
1903	delivery issues.
1904	3.  Use quality indicators derived from the clinical care
1905	standards or practice guidelines to screen and monitor care and
1906	services delivered.
1907	(c)  Guidelines for external quality review of each
1908	contractor which require: focused studies of patterns of care;
1909	individual care review in specific situations; and followup
1910	activities on previous pattern-of-care study findings and
1911	individual-care-review findings. In designing the external
1912	quality review function and determining how it is to operate as
1913	part of the state's overall quality improvement system, the
1914	agency shall construct its external quality review organization
1915	and entity contracts to address each of the following:
1916	1.  Delineating the role of the external quality review
1917	organization.
1918	2.  Length of the external quality review organization
1919	contract with the state.
1920	3.  Participation of the contracting entities in designing
1921	external quality review organization review activities.
1922	4.  Potential variation in the type of clinical conditions
1923	and health services delivery issues to be studied at each plan.
1924	5.  Determining the number of focused pattern-of-care
1925	studies to be conducted for each plan.
1926	6.  Methods for implementing focused studies.
1927	7.  Individual care review.
1928	8.  Followup activities.
1929	(28)  In order to ensure that children receive health care
1930	services for which an entity has already been compensated, an
1931	entity contracting with the agency pursuant to this section
1932	shall achieve an annual Early and Periodic Screening, Diagnosis,
1933	and Treatment (EPSDT) Service screening rate of at least 60
1934	percent for those recipients continuously enrolled for at least
1935	8 months. The agency shall develop a method by which the EPSDT
1936	screening rate shall be calculated. For any entity which does
1937	not achieve the annual 60 percent rate, the entity must submit a
1938	corrective action plan for the agency's approval. If the entity
1939	does not meet the standard established in the corrective action
1940	plan during the specified timeframe, the agency is authorized to
1941	impose appropriate contract sanctions. At least annually, the
1942	agency shall publicly release the EPSDT Services screening rates
1943	of each entity it has contracted with on a prepaid basis to
1944	serve Medicaid recipients.
1945	(29)  The agency shall perform enrollments and
1946	disenrollments for Medicaid recipients who are eligible for
1947	MediPass or managed care plans. Notwithstanding the prohibition
1948	contained in paragraph (21)(19)(f), managed care plans may
1949	perform preenrollments of Medicaid recipients under the
1950	supervision of the agency or its agents. For the purposes of
1951	this section, "preenrollment" means the provision of marketing
1952	and educational materials to a Medicaid recipient and assistance
1953	in completing the application forms, but shall not include
1954	actual enrollment into a managed care plan. An application for
1955	enrollment shall not be deemed complete until the agency or its
1956	agent verifies that the recipient made an informed, voluntary
1957	choice. The agency, in cooperation with the Department of
1958	Children and Family Services, may test new marketing initiatives
1959	to inform Medicaid recipients about their managed care options
1960	at selected sites. The agency shall report to the Legislature on
1961	the effectiveness of such initiatives. The agency may contract
1962	with a third party to perform managed care plan and MediPass
1963	enrollment and disenrollment services for Medicaid recipients
1964	and is authorized to adopt rules to implement such services. The
1965	agency may adjust the capitation rate only to cover the costs of
1966	a third-party enrollment and disenrollment contract, and for
1967	agency supervision and management of the managed care plan
1968	enrollment and disenrollment contract.
1969	(30)  Any lists of providers made available to Medicaid
1970	recipients, MediPass enrollees, or managed care plan enrollees
1971	shall be arranged alphabetically showing the provider's name and
1972	specialty and, separately, by specialty in alphabetical order.
1973	(31)  The agency shall establish an enhanced managed care
1974	quality assurance oversight function, to include at least the
1975	following components:
1976	(a)  At least quarterly analysis and followup, including
1977	sanctions as appropriate, of managed care participant
1978	utilization of services.
1979	(b)  At least quarterly analysis and followup, including
1980	sanctions as appropriate, of quality findings of the Medicaid
1981	peer review organization and other external quality assurance
1982	programs.
1983	(c)  At least quarterly analysis and followup, including
1984	sanctions as appropriate, of the fiscal viability of managed
1985	care plans.
1986	(d)  At least quarterly analysis and followup, including
1987	sanctions as appropriate, of managed care participant
1988	satisfaction and disenrollment surveys.
1989	(e)  The agency shall conduct regular and ongoing Medicaid
1990	recipient satisfaction surveys.
1991
1992	The analyses and followup activities conducted by the agency
1993	under its enhanced managed care quality assurance oversight
1994	function shall not duplicate the activities of accreditation
1995	reviewers for entities regulated under part III of chapter 641,
1996	but may include a review of the finding of such reviewers.
1997	(32)  Each managed care plan that is under contract with
1998	the agency to provide health care services to Medicaid
1999	recipients shall annually conduct a background check with the
2000	Florida Department of Law Enforcement of all persons with
2001	ownership interest of 5 percent or more or executive management
2002	responsibility for the managed care plan and shall submit to the
2003	agency information concerning any such person who has been found
2004	guilty of, regardless of adjudication, or has entered a plea of
2005	nolo contendere or guilty to, any of the offenses listed in s.
2006	435.03.
2007	(33)  The agency shall, by rule, develop a process whereby
2008	a Medicaid managed care plan enrollee who wishes to enter
2009	hospice care may be disenrolled from the managed care plan
2010	within 24 hours after contacting the agency regarding such
2011	request. The agency rule shall include a methodology for the
2012	agency to recoup managed care plan payments on a pro rata basis
2013	if payment has been made for the enrollment month when
2014	disenrollment occurs.
2015	(34)  The agency and entities which contract with the
2016	agency to provide health care services to Medicaid recipients
2017	under this section or s. 409.9122 must comply with the
2018	provisions of s. 641.513 in providing emergency services and
2019	care to Medicaid recipients and MediPass recipients.
2020	(35)  All entities providing health care services to
2021	Medicaid recipients shall make available, and encourage all
2022	pregnant women and mothers with infants to receive, and provide
2023	documentation in the medical records to reflect, the following:
2024	(a)  Healthy Start prenatal or infant screening.
2025	(b)  Healthy Start care coordination, when screening or
2026	other factors indicate need.
2027	(c)  Healthy Start enhanced services in accordance with the
2028	prenatal or infant screening results.
2029	(d)  Immunizations in accordance with recommendations of
2030	the Advisory Committee on Immunization Practices of the United
2031	States Public Health Service and the American Academy of
2032	Pediatrics, as appropriate.
2033	(e)  Counseling and services for family planning to all
2034	women and their partners.
2035	(f)  A scheduled postpartum visit for the purpose of
2036	voluntary family planning, to include discussion of all methods
2037	of contraception, as appropriate.
2038	(g)  Referral to the Special Supplemental Nutrition Program
2039	for Women, Infants, and Children (WIC).
2040	(36)  Any entity that provides Medicaid prepaid health plan
2041	services shall ensure the appropriate coordination of health
2042	care services with an assisted living facility in cases where a
2043	Medicaid recipient is both a member of the entity's prepaid
2044	health plan and a resident of the assisted living facility. If
2045	the entity is at risk for Medicaid targeted case management and
2046	behavioral health services, the entity shall inform the assisted
2047	living facility of the procedures to follow should an emergent
2048	condition arise.
2049	(37)  The agency may seek and implement federal waivers
2050	necessary to provide for cost-effective purchasing of home
2051	health services, private duty nursing services, transportation,
2052	independent laboratory services, and durable medical equipment
2053	and supplies through competitive bidding pursuant to s. 287.057.
2054	The agency may request appropriate waivers from the federal
2055	Health Care Financing Administration in order to competitively
2056	bid such services. The agency may exclude providers not selected
2057	through the bidding process from the Medicaid provider network.
2058	(38)  The Agency for Health Care Administration is directed
2059	to issue a request for proposal or intent to negotiate to
2060	implement on a demonstration basis an outpatient specialty
2061	services pilot project in a rural and urban county in the state.
2062	As used in this subsection, the term "outpatient specialty
2063	services" means clinical laboratory, diagnostic imaging, and
2064	specified home medical services to include durable medical
2065	equipment, prosthetics and orthotics, and infusion therapy.
2066	(a)  The entity that is awarded the contract to provide
2067	Medicaid managed care outpatient specialty services must, at a
2068	minimum, meet the following criteria:
2069	1.  The entity must be licensed by the Office of Insurance
2070	Regulation under part II of chapter 641.
2071	2.  The entity must be experienced in providing outpatient
2072	specialty services.
2073	3.  The entity must demonstrate to the satisfaction of the
2074	agency that it provides high-quality services to its patients.
2075	4.  The entity must demonstrate that it has in place a
2076	complaints and grievance process to assist Medicaid recipients
2077	enrolled in the pilot managed care program to resolve complaints
2078	and grievances.
2079	(b)  The pilot managed care program shall operate for a
2080	period of 3 years. The objective of the pilot program shall be
2081	to determine the cost-effectiveness and effects on utilization,
2082	access, and quality of providing outpatient specialty services
2083	to Medicaid recipients on a prepaid, capitated basis.
2084	(c)  The agency shall conduct a quality assurance review of
2085	the prepaid health clinic each year that the demonstration
2086	program is in effect. The prepaid health clinic is responsible
2087	for all expenses incurred by the agency in conducting a quality
2088	assurance review.
2089	(d)  The entity that is awarded the contract to provide
2090	outpatient specialty services to Medicaid recipients shall
2091	report data required by the agency in a format specified by the
2092	agency, for the purpose of conducting the evaluation required in
2093	paragraph (e).
2094	(e)  The agency shall conduct an evaluation of the pilot
2095	managed care program and report its findings to the Governor and
2096	the Legislature by no later than January 1, 2001.
2097	(39)  The agency shall enter into agreements with not-for-
2098	profit organizations based in this state for the purpose of
2099	providing vision screening.
2100	(40)(a)  The agency shall implement a Medicaid prescribed-
2101	drug spending-control program that includes the following
2102	components:
2103	1.  Medicaid prescribed-drug coverage for brand-name drugs
2104	for adult Medicaid recipients is limited to the dispensing of
2105	four brand-name drugs per month per recipient. Children are
2106	exempt from this restriction. Antiretroviral agents are excluded
2107	from this limitation. No requirements for prior authorization or
2108	other restrictions on medications used to treat mental illnesses
2109	such as schizophrenia, severe depression, or bipolar disorder
2110	may be imposed on Medicaid recipients. Medications that will be
2111	available without restriction for persons with mental illnesses
2112	include atypical antipsychotic medications, conventional
2113	antipsychotic medications, selective serotonin reuptake
2114	inhibitors, and other medications used for the treatment of
2115	serious mental illnesses. The agency shall also limit the amount
2116	of a prescribed drug dispensed to no more than a 34-day supply.
2117	The agency shall continue to provide unlimited generic drugs,
2118	contraceptive drugs and items, and diabetic supplies. Although a
2119	drug may be included on the preferred drug formulary, it would
2120	not be exempt from the four-brand limit. The agency may
2121	authorize exceptions to the brand-name-drug restriction based
2122	upon the treatment needs of the patients, only when such
2123	exceptions are based on prior consultation provided by the
2124	agency or an agency contractor, but the agency must establish
2125	procedures to ensure that:
2126	a.  There will be a response to a request for prior
2127	consultation by telephone or other telecommunication device
2128	within 24 hours after receipt of a request for prior
2129	consultation;
2130	b.  A 72-hour supply of the drug prescribed will be
2131	provided in an emergency or when the agency does not provide a
2132	response within 24 hours as required by sub-subparagraph a.; and
2133	c.  Except for the exception for nursing home residents and
2134	other institutionalized adults and except for drugs on the
2135	restricted formulary for which prior authorization may be sought
2136	by an institutional or community pharmacy, prior authorization
2137	for an exception to the brand-name-drug restriction is sought by
2138	the prescriber and not by the pharmacy. When prior authorization
2139	is granted for a patient in an institutional setting beyond the
2140	brand-name-drug restriction, such approval is authorized for 12
2141	months and monthly prior authorization is not required for that
2142	patient.
2143	2.  Reimbursement to pharmacies for Medicaid prescribed
2144	drugs shall be set at the lesser of: the average wholesale price
2145	(AWP) minus 15.4 percent, the wholesaler acquisition cost (WAC)
2146	plus 5.75 percent, the federal upper limit (FUL), the state
2147	maximum allowable cost (SMAC), or the usual and customary (UAC)
2148	charge billed by the provider the average wholesale price less
2149	13.25 percent.
2150	3.  The agency shall develop and implement a process for
2151	managing the drug therapies of Medicaid recipients who are using
2152	significant numbers of prescribed drugs each month. The
2153	management process may include, but is not limited to,
2154	comprehensive, physician-directed medical-record reviews, claims
2155	analyses, and case evaluations to determine the medical
2156	necessity and appropriateness of a patient's treatment plan and
2157	drug therapies. The agency may contract with a private
2158	organization to provide drug-program-management services. The
2159	Medicaid drug benefit management program shall include
2160	initiatives to manage drug therapies for HIV/AIDS patients,
2161	patients using 20 or more unique prescriptions in a 180-day
2162	period, and the top 1,000 patients in annual spending.
2163	4.  The agency may limit the size of its pharmacy network
2164	based on need, competitive bidding, price negotiations,
2165	credentialing, or similar criteria. The agency shall give
2166	special consideration to rural areas in determining the size and
2167	location of pharmacies included in the Medicaid pharmacy
2168	network. A pharmacy credentialing process may include criteria
2169	such as a pharmacy's full-service status, location, size,
2170	patient educational programs, patient consultation, disease-
2171	management services, and other characteristics. The agency may
2172	impose a moratorium on Medicaid pharmacy enrollment when it is
2173	determined that it has a sufficient number of Medicaid-
2174	participating providers.
2175	5.  The agency shall develop and implement a program that
2176	requires Medicaid practitioners who prescribe drugs to use a
2177	counterfeit-proof prescription pad for Medicaid prescriptions.
2178	The agency shall require the use of standardized counterfeit-
2179	proof prescription pads by Medicaid-participating prescribers or
2180	prescribers who write prescriptions for Medicaid recipients. The
2181	agency may implement the program in targeted geographic areas or
2182	statewide.
2183	6.  The agency may enter into arrangements that require
2184	manufacturers of generic drugs prescribed to Medicaid recipients
2185	to provide rebates of at least 15.1 percent of the average
2186	manufacturer price for the manufacturer's generic products.
2187	These arrangements shall require that if a generic-drug
2188	manufacturer pays federal rebates for Medicaid-reimbursed drugs
2189	at a level below 15.1 percent, the manufacturer must provide a
2190	supplemental rebate to the state in an amount necessary to
2191	achieve a 15.1-percent rebate level.
2192	7.  The agency may establish a preferred drug formulary in
2193	accordance with 42 U.S.C. s. 1396r-8, and, pursuant to the
2194	establishment of such formulary, it is authorized to negotiate
2195	supplemental rebates from manufacturers that are in addition to
2196	those required by Title XIX of the Social Security Act and at no
2197	less than 14 10 percent of the average manufacturer price as
2198	defined in 42 U.S.C. s. 1936 on the last day of a quarter unless
2199	the federal or supplemental rebate, or both, equals or exceeds
2200	29 25 percent. There is no upper limit on the supplemental
2201	rebates the agency may negotiate. The agency may determine that
2202	specific products, brand-name or generic, are competitive at
2203	lower rebate percentages. Agreement to pay the minimum
2204	supplemental rebate percentage will guarantee a manufacturer
2205	that the Medicaid Pharmaceutical and Therapeutics Committee will
2206	consider a product for inclusion on the preferred drug
2207	formulary. However, a pharmaceutical manufacturer is not
2208	guaranteed placement on the formulary by simply paying the
2209	minimum supplemental rebate. Agency decisions will be made on
2210	the clinical efficacy of a drug and recommendations of the
2211	Medicaid Pharmaceutical and Therapeutics Committee, as well as
2212	the price of competing products minus federal and state rebates.
2213	The agency is authorized to contract with an outside agency or
2214	contractor to conduct negotiations for supplemental rebates. For
2215	the purposes of this section, the term "supplemental rebates"
2216	means may include, at the agency's discretion, cash rebates and
2217	other program benefits that offset a Medicaid expenditure.
2218	Effective July 1, 2004, value-added programs as a substitution
2219	for supplemental rebates are prohibited. Such other program
2220	benefits may include, but are not limited to, disease management
2221	programs, drug product donation programs, drug utilization
2222	control programs, prescriber and beneficiary counseling and
2223	education, fraud and abuse initiatives, and other services or
2224	administrative investments with guaranteed savings to the
2225	Medicaid program in the same year the rebate reduction is
2226	included in the General Appropriations Act. The agency is
2227	authorized to seek any federal waivers to implement this
2228	initiative.
2229	8.  The agency shall establish an advisory committee for
2230	the purposes of studying the feasibility of using a restricted
2231	drug formulary for nursing home residents and other
2232	institutionalized adults. The committee shall be comprised of
2233	seven members appointed by the Secretary of Health Care
2234	Administration. The committee members shall include two
2235	physicians licensed under chapter 458 or chapter 459; three
2236	pharmacists licensed under chapter 465 and appointed from a list
2237	of recommendations provided by the Florida Long-Term Care
2238	Pharmacy Alliance; and two pharmacists licensed under chapter
2239	465.
2240	9.  The Agency for Health Care Administration shall expand
2241	home delivery of pharmacy products. To assist Medicaid patients
2242	in securing their prescriptions and reduce program costs, the
2243	agency shall expand its current mail-order-pharmacy diabetes-
2244	supply program to include all generic and brand-name drugs used
2245	by Medicaid patients with diabetes. Medicaid recipients in the
2246	current program may obtain nondiabetes drugs on a voluntary
2247	basis. This initiative is limited to the geographic area covered
2248	by the current contract. The agency may seek and implement any
2249	federal waivers necessary to implement this subparagraph.
2250	10.  The agency shall limit to one dose per month any drug
2251	prescribed to treat erectile dysfunction.
2252	11.a.  The agency shall implement a Medicaid behavioral
2253	drug management system. The agency may contract with a vendor
2254	that has experience in operating behavioral drug management
2255	systems to implement this program. The agency is authorized to
2256	seek federal waivers to implement this program.
2257	b.  The agency, in conjunction with the Department of
2258	Children and Family Services, may implement the Medicaid
2259	behavioral drug management system that is designed to improve
2260	the quality of care and behavioral health prescribing practices
2261	based on best practice guidelines, improve patient adherence to
2262	medication plans, reduce clinical risk, and lower prescribed
2263	drug costs and the rate of inappropriate spending on Medicaid
2264	behavioral drugs. The program shall include the following
2265	elements:
2266	(I)  Provide for the development and adoption of best
2267	practice guidelines for behavioral health-related drugs such as
2268	antipsychotics, antidepressants, and medications for treating
2269	bipolar disorders and other behavioral conditions; translate
2270	them into practice; review behavioral health prescribers and
2271	compare their prescribing patterns to a number of indicators
2272	that are based on national standards; and determine deviations
2273	from best practice guidelines.
2274	(II)  Implement processes for providing feedback to and
2275	educating prescribers using best practice educational materials
2276	and peer-to-peer consultation.
2277	(III)  Assess Medicaid beneficiaries who are outliers in
2278	their use of behavioral health drugs with regard to the numbers
2279	and types of drugs taken, drug dosages, combination drug
2280	therapies, and other indicators of improper use of behavioral
2281	health drugs.
2282	(IV)  Alert prescribers to patients who fail to refill
2283	prescriptions in a timely fashion, are prescribed multiple same-
2284	class behavioral health drugs, and may have other potential
2285	medication problems.
2286	(V)  Track spending trends for behavioral health drugs and
2287	deviation from best practice guidelines.
2288	(VI)  Use educational and technological approaches to
2289	promote best practices, educate consumers, and train prescribers
2290	in the use of practice guidelines.
2291	(VII)  Disseminate electronic and published materials.
2292	(VIII)  Hold statewide and regional conferences.
2293	(IX)  Implement a disease management program with a model
2294	quality-based medication component for severely mentally ill
2295	individuals and emotionally disturbed children who are high
2296	users of care.
2297	c.  If the agency is unable to negotiate a contract with
2298	one or more manufacturers to finance and guarantee savings
2299	associated with a behavioral drug management program by
2300	September 1, 2004, the four-brand drug limit and preferred drug
2301	list prior-authorization requirements shall apply to mental-
2302	health-related drugs, notwithstanding any provision in
2303	subparagraph 1. The agency is authorized to seek federal waivers
2304	to implement this policy.
2305	12.  The agency is authorized to contract for drug rebate
2306	administration, including, but not limited to, calculating
2307	rebate amounts, invoicing manufacturers, negotiating disputes
2308	with manufacturers, and maintaining a database of rebate
2309	collections.
2310	13.  The agency may specify the preferred daily dosing form
2311	or strength for the purpose of promoting best practices with
2312	regard to the prescribing of certain drugs as specified in the
2313	General Appropriations Act and ensuring cost-effective
2314	prescribing practices.
2315	14.  The agency may require prior authorization for the
2316	off-label use of Medicaid-covered prescribed drugs as specified
2317	in the General Appropriations Act. The agency may, but is not
2318	required to, preauthorize the use of a product for an indication
2319	not in the approved labeling. Prior authorization may require
2320	the prescribing professional to provide information about the
2321	rationale and supporting medical evidence for the off-label use
2322	of a drug.
2323	15.  The agency shall implement a return and reuse program
2324	for drugs dispensed by pharmacies to institutional recipients,
2325	which includes payment of a $5 restocking fee for the
2326	implementation and operation of the program. The return and
2327	reuse program shall be implemented electronically and in a
2328	manner that promotes efficiency. The program must permit a
2329	pharmacy to exclude drugs from the program if it is not
2330	practical or cost-effective for the drug to be included and must
2331	provide for the return to inventory of drugs that cannot be
2332	credited or returned in a cost-effective manner.
2333	(b)  The agency shall implement this subsection to the
2334	extent that funds are appropriated to administer the Medicaid
2335	prescribed-drug spending-control program. The agency may
2336	contract all or any part of this program to private
2337	organizations.
2338	(c)  The agency shall submit quarterly reports to the
2339	Governor, the President of the Senate, and the Speaker of the
2340	House of Representatives which must include, but need not be
2341	limited to, the progress made in implementing this subsection
2342	and its effect on Medicaid prescribed-drug expenditures.
2343	(41)  Notwithstanding the provisions of chapter 287, the
2344	agency may, at its discretion, renew a contract or contracts for
2345	fiscal intermediary services one or more times for such periods
2346	as the agency may decide; however, all such renewals may not
2347	combine to exceed a total period longer than the term of the
2348	original contract.
2349	(42)  The agency shall provide for the development of a
2350	demonstration project by establishment in Miami-Dade County of a
2351	long-term-care facility licensed pursuant to chapter 395 to
2352	improve access to health care for a predominantly minority,
2353	medically underserved, and medically complex population and to
2354	evaluate alternatives to nursing home care and general acute
2355	care for such population. Such project is to be located in a
2356	health care condominium and colocated with licensed facilities
2357	providing a continuum of care. The establishment of this project
2358	is not subject to the provisions of s. 408.036 or s. 408.039.
2359	The agency shall report its findings to the Governor, the
2360	President of the Senate, and the Speaker of the House of
2361	Representatives by January 1, 2003.
2362	(43)  The agency shall develop and implement a utilization
2363	management program for Medicaid-eligible recipients for the
2364	management of occupational, physical, respiratory, and speech
2365	therapies. The agency shall establish a utilization program that
2366	may require prior authorization in order to ensure medically
2367	necessary and cost-effective treatments. The program shall be
2368	operated in accordance with a federally approved waiver program
2369	or state plan amendment. The agency may seek a federal waiver or
2370	state plan amendment to implement this program. The agency may
2371	also competitively procure these services from an outside vendor
2372	on a regional or statewide basis.
2373	(44)  The agency may contract on a prepaid or fixed-sum
2374	basis with appropriately licensed prepaid dental health plans to
2375	provide dental services.
2376	(45)  The Agency for Health Care Administration shall
2377	ensure that any Medicaid managed care plan as defined in s.
2378	409.9122(2)(h), whether paid on a capitated basis or a shared
2379	savings basis, is cost-effective. For purposes of this
2380	subsection, the term "cost-effective" means that a network's
2381	per-member, per-month costs to the state, including, but not
2382	limited to, fee-for-service costs, administrative costs, and
2383	case-management fees, must be no greater than the state's costs
2384	associated with contracts for Medicaid services established
2385	under subsection (3), which shall be actuarially adjusted for
2386	case mix, model, and service area. The agency shall conduct
2387	actuarially sound audits adjusted for case mix and model in
2388	order to ensure such cost-effectiveness and shall publish the
2389	audit results on its Internet website and submit the audit
2390	results annually to the Governor, the President of the Senate,
2391	and the Speaker of the House of Representatives no later than
2392	December 31 of each year. Contracts established pursuant to this
2393	subsection which are not cost-effective may not be renewed.
2394	Section 18.  Paragraphs (a) and (e) of subsection (2) of
2395	section 409.9122, Florida Statutes, are amended, and subsection
2396	(14) is added to said section, to read:
2397	409.9122  Mandatory Medicaid managed care enrollment;
2398	programs and procedures.--
2399	(2)(a)  The agency shall enroll in a managed care plan or
2400	MediPass all Medicaid recipients, except those Medicaid
2401	recipients who are: in an institution; enrolled in the Medicaid
2402	medically needy program; or eligible for both Medicaid and
2403	Medicare. Upon enrollment, individuals will be able to change
2404	their managed care option during the 90-day opt out period
2405	required by federal Medicaid regulations. The agency is
2406	authorized to seek the necessary Medicaid state plan amendment
2407	to implement this policy. However, to the extent permitted by
2408	federal law, the agency may enroll in a managed care plan or
2409	MediPass a Medicaid recipient who is exempt from mandatory
2410	managed care enrollment, provided that:
2411	1.  The recipient's decision to enroll in a managed care
2412	plan or MediPass is voluntary;
2413	2.  If the recipient chooses to enroll in a managed care
2414	plan, the agency has determined that the managed care plan
2415	provides specific programs and services which address the
2416	special health needs of the recipient; and
2417	3.  The agency receives any necessary waivers from the
2418	federal Health Care Financing Administration.
2419
2420	The agency shall develop rules to establish policies by which
2421	exceptions to the mandatory managed care enrollment requirement
2422	may be made on a case-by-case basis. The rules shall include the
2423	specific criteria to be applied when making a determination as
2424	to whether to exempt a recipient from mandatory enrollment in a
2425	managed care plan or MediPass. School districts participating in
2426	the certified school match program pursuant to ss. 409.908(21)
2427	and 1011.70 shall be reimbursed by Medicaid, subject to the
2428	limitations of s. 1011.70(1), for a Medicaid-eligible child
2429	participating in the services as authorized in s. 1011.70, as
2430	provided for in s. 409.9071, regardless of whether the child is
2431	enrolled in MediPass or a managed care plan. Managed care plans
2432	shall make a good faith effort to execute agreements with school
2433	districts regarding the coordinated provision of services
2434	authorized under s. 1011.70. County health departments
2435	delivering school-based services pursuant to ss. 381.0056 and
2436	381.0057 shall be reimbursed by Medicaid for the federal share
2437	for a Medicaid-eligible child who receives Medicaid-covered
2438	services in a school setting, regardless of whether the child is
2439	enrolled in MediPass or a managed care plan. Managed care plans
2440	shall make a good faith effort to execute agreements with county
2441	health departments regarding the coordinated provision of
2442	services to a Medicaid-eligible child. To ensure continuity of
2443	care for Medicaid patients, the agency, the Department of
2444	Health, and the Department of Education shall develop procedures
2445	for ensuring that a student's managed care plan or MediPass
2446	provider receives information relating to services provided in
2447	accordance with ss. 381.0056, 381.0057, 409.9071, and 1011.70.
2448	(e)  Medicaid recipients who are already enrolled in a
2449	managed care plan or MediPass shall be offered the opportunity
2450	to change managed care plans or MediPass providers on a
2451	staggered basis, as defined by the agency. All Medicaid
2452	recipients shall have 30 90 days in which to make a choice of
2453	managed care plans or MediPass providers. Those Medicaid
2454	recipients who do not make a choice shall be assigned to a
2455	managed care plan or MediPass in accordance with paragraph (f).
2456	To facilitate continuity of care, for a Medicaid recipient who
2457	is also a recipient of Supplemental Security Income (SSI), prior
2458	to assigning the SSI recipient to a managed care plan or
2459	MediPass, the agency shall determine whether the SSI recipient
2460	has an ongoing relationship with a MediPass provider or managed
2461	care plan, and if so, the agency shall assign the SSI recipient
2462	to that MediPass provider or managed care plan. Those SSI
2463	recipients who do not have such a provider relationship shall be
2464	assigned to a managed care plan or MediPass provider in
2465	accordance with paragraph (f).
2466	(14)  The agency shall include in its calculation of the
2467	hospital inpatient component of a Medicaid health maintenance
2468	organization's capitation rate any special payments, including,
2469	but not limited to, upper payment limit or disproportionate
2470	share hospital payments, made to qualifying hospitals through
2471	the fee-for-service program. The agency may seek federal waiver
2472	approval or state plan amendment as needed to implement this
2473	adjustment.
2474	Section 19.  Section 409.9124, Florida Statutes, is amended
2475	to read:
2476	409.9124  Managed care reimbursement.--
2477	(1)  The agency shall develop and adopt by rule a
2478	methodology for reimbursing managed care plans.
2479	(2)  Final rates shall be published annually prior to
2480	September 1 of each year, based on methodology that:
2481	(a)  Uses Medicaid's fee-for-service expenditures.
2482	(b)  Is certified as an actuarially sound computation of
2483	Medicaid fee-for-service expenditures for comparable groups of
2484	Medicaid recipients and includes all fee-for-service
2485	expenditures, including those fee-for-service expenditures
2486	attributable to recipients who are enrolled for a portion of a
2487	year in a managed care plan or waiver program.
2488	(c)  Is compliant with applicable federal laws and
2489	regulations, including, but not limited to, the requirements to
2490	include an allowance for administrative expenses and to account
2491	for all fee-for service expenditures, including fee-for-service
2492	expenditures for those groups enrolled for part of a year.
2493	(3)  Each year prior to establishing new managed care
2494	rates, the agency shall review all prior year adjustments for
2495	changes in trend, and shall reduce or eliminate those
2496	adjustments which are not reasonable and which reflect policies
2497	or programs which are not in effect.
2498	(4)(2)  The agency shall by rule prescribe those items of
2499	financial information which each managed care plan shall report
2500	to the agency, in the time periods prescribed by rule. In
2501	prescribing items for reporting and definitions of terms, the
2502	agency shall consult with the Office of Insurance Regulation of
2503	the Financial Services Commission wherever possible.
2504	(5)(3)  The agency shall quarterly examine the financial
2505	condition of each managed care plan, and its performance in
2506	serving Medicaid patients, and shall utilize examinations
2507	performed by the Office of Insurance Regulation wherever
2508	possible.
2509	Section 20.  Paragraph (b) of subsection (5) of section
2510	624.91, Florida Statutes, as amended by chapter 2004-1, Laws of
2511	Florida, is amended to read:
2512	624.91  The Florida Healthy Kids Corporation Act.--
2513	(5)  CORPORATION AUTHORIZATION, DUTIES, POWERS.--
2514	(b)  The Florida Healthy Kids Corporation shall:
2515	1.  Arrange for the collection of any family, local
2516	contributions, or employer payment or premium, in an amount to
2517	be determined by the board of directors, to provide for payment
2518	of premiums for comprehensive insurance coverage and for the
2519	actual or estimated administrative expenses.
2520	2.  Arrange for the collection of any voluntary
2521	contributions to provide for payment of premiums for children
2522	who are not eligible for medical assistance under Title XXI of
2523	the Social Security Act. Each fiscal year, the corporation shall
2524	establish a local match policy for the enrollment of non-Title-
2525	XXI-eligible children in the Healthy Kids program. By May 1 of
2526	each year, the corporation shall provide written notification of
2527	the amount to be remitted to the corporation for the following
2528	fiscal year under that policy. Local match sources may include,
2529	but are not limited to, funds provided by municipalities,
2530	counties, school boards, hospitals, health care providers,
2531	charitable organizations, special taxing districts, and private
2532	organizations. The minimum local match cash contributions
2533	required each fiscal year and local match credits shall be
2534	determined by the General Appropriations Act. The corporation
2535	shall calculate a county's local match rate based upon that
2536	county's percentage of the state's total non-Title-XXI
2537	expenditures as reported in the corporation's most recently
2538	audited financial statement. In awarding the local match
2539	credits, the corporation may consider factors including, but not
2540	limited to, population density, per capita income, and existing
2541	child-health-related expenditures and services.
2542	3.  Subject to the provisions of s. 409.8134, accept
2543	voluntary supplemental local match contributions that comply
2544	with the requirements of Title XXI of the Social Security Act
2545	for the purpose of providing additional coverage in contributing
2546	counties under Title XXI.
2547	4.  Establish the administrative and accounting procedures
2548	for the operation of the corporation.
2549	5.  Establish, with consultation from appropriate
2550	professional organizations, standards for preventive health
2551	services and providers and comprehensive insurance benefits
2552	appropriate to children, provided that such standards for rural
2553	areas shall not limit primary care providers to board-certified
2554	pediatricians.
2555	6.  Determine eligibility for children seeking to
2556	participate in the Title XXI-funded components of the Florida
2557	KidCare program consistent with the requirements specified in s.
2558	409.814, as well as the non-Title-XXI-eligible children as
2559	provided in subsection (3).
2560	7.  Establish procedures under which providers of local
2561	match to, applicants to and participants in the program may have
2562	grievances reviewed by an impartial body and reported to the
2563	board of directors of the corporation.
2564	8.  Establish participation criteria and, if appropriate,
2565	contract with an authorized insurer, health maintenance
2566	organization, or third-party administrator to provide
2567	administrative services to the corporation.
2568	9.  Establish enrollment criteria which shall include
2569	penalties or waiting periods of not fewer than 60 days for
2570	reinstatement of coverage upon voluntary cancellation for
2571	nonpayment of family premiums.
2572	10.  Contract with authorized insurers or any provider of
2573	health care services, meeting standards established by the
2574	corporation, for the provision of comprehensive insurance
2575	coverage to participants. Such standards shall include criteria
2576	under which the corporation may contract with more than one
2577	provider of health care services in program sites. Health plans
2578	shall be selected through a competitive bid process. The Florida
2579	Healthy Kids Corporation shall purchase goods and services in
2580	the most cost-effective manner consistent with the delivery of
2581	quality medical care. The maximum administrative cost for a
2582	Florida Healthy Kids Corporation contract shall be 15 percent.
2583	For health care contracts, the minimum medical loss ratio for a
2584	Florida Healthy Kids Corporation contract shall be 85 percent.
2585	For dental contracts, the remaining compensation to be paid to
2586	the authorized insurer or provider under a Florida Healthy Kids
2587	Corporation contract shall be no less than an amount which is 85
2588	percent of premium; to the extent any contract provision does
2589	not provide for this minimum compensation, this section shall
2590	prevail. The health plan selection criteria and scoring system,
2591	and the scoring results, shall be available upon request for
2592	inspection after the bids have been awarded.
2593	11.  Establish disenrollment criteria in the event local
2594	matching funds are insufficient to cover enrollments.
2595	12.  Develop and implement a plan to publicize the Florida
2596	Healthy Kids Corporation, the eligibility requirements of the
2597	program, and the procedures for enrollment in the program and to
2598	maintain public awareness of the corporation and the program.
2599	13.  Secure staff necessary to properly administer the
2600	corporation. Staff costs shall be funded from state and local
2601	matching funds and such other private or public funds as become
2602	available. The board of directors shall determine the number of
2603	staff members necessary to administer the corporation.
2604	14.  Provide a report annually to the Governor, Chief
2605	Financial Officer, Commissioner of Education, Senate President,
2606	Speaker of the House of Representatives, and Minority Leaders of
2607	the Senate and the House of Representatives.
2608	15.  Establish benefit packages which conform to the
2609	provisions of the Florida KidCare program, as created in ss.
2610	409.810-409.820.
2611	Section 21.  Notwithstanding s. 430.707, Florida Statutes,
2612	no later than September 1, 2005, subject to federal approval of
2613	the application to be a Program of All-inclusive Care for the
2614	Elderly site, the agency shall contract with one private, not-
2615	for-profit hospice organization located in Lee County and one
2616	such organization in Martin County, such an entity shall be
2617	exempt from the requirements of chapter 641 Florida Statutes,
2618	each of which provides comprehensive services, including hospice
2619	care for frail and elderly persons. The agency shall approve 100
2620	initial enrollees in the Program of All-inclusive Care for the
2621	Elderly in Lee and Martin counties. There shall be 50 initial
2622	enrollees in each county.
2623	Section 22.  In order to improve affordability and provide
2624	coverage for more facilities for residents of the state, the
2625	agency shall renegotiate the terms, conditions, and duration of
2626	its loan to the Long Term Care Risk Retention Group to provide
2627	that participating skilled nursing facilities be required to pay
2628	no more than $65 per bed for capitalization costs and
2629	participating adult living facilities will be required to pay no
2630	more than $33 per bed for capitalization costs.
2631	Section 23.  The Office of Program Policy Analysis and
2632	Government Accountability shall perform a review of optional
2633	Medicaid coverage for pregnant women, adult dentures, and the
2634	medically needy. The review shall determine the cost benefit to
2635	the state of providing these optional Medicaid items to Medicaid
2636	recipients. A report on the findings of the review shall be
2637	provided to the Executive Office of the Governor, the President
2638	of the Senate, and the Speaker of the House of Representatives
2639	by February 1, 2005.
2640	Section 24.  The Agency for Health Care Administration may
2641	contract on a capitated, prepaid, or fixed-sum basis with a
2642	laboratory service provider to provide statewide laboratory
2643	services for Medicaid recipients. The contract is not subject to
2644	any requirement of the Florida Insurance Code. Whether or not
2645	the agency procures statewide laboratory services, the agency
2646	shall ensure that it secures laboratory values from Medicaid-
2647	enrolled laboratories for all tests provided to Medicaid
2648	recipients. Such data shall be included in the Medicaid real-
2649	time web-based reporting system that interfaces with a real-time
2650	web-based prescription ordering and tracking system as required
2651	by the 2003-2004 General Appropriations Act.
2652	Section 25.  Except as otherwise provided herein, this act
2653	shall take effect July 1, 2004.

CODING: Words stricken are deletions; words underlined are additions.