HB 1073

1	A bill to be entitled
2	An act relating to the Medicaid managed care pilot
3	program; amending s. 409.91211, F.S.; requiring the Agency
4	for Health Care Administration to develop a methodology
5	for calculating risk-adjusted capitation rates based on
6	information in the encounter database; requiring that
7	specified criteria be met prior to implementation of the
8	methodology; providing for use of an interim risk-adjusted
9	methodology; providing a phase-in schedule for the
10	encounter-based methodology for participating managed care
11	plans; requiring the phase-in schedule to be applied anew
12	for counties into which the program expands; providing an
13	effective date.
14
15	Be It Enacted by the Legislature of the State of Florida:
16
17	Section 1.  Subsections (8) and (9) of section 409.91211,
18	Florida Statutes, are amended to read:
19	409.91211  Medicaid managed care pilot program.--
20	(8)(a)  The agency shall develop a methodology for
21	calculating risk-adjusted capitation rates using comprehensive
22	encounter and diagnosis data pursuant to subparagraph (3)(p)4.
23	for all acute Medicaid services. Prior to the implementation of
24	the risk-adjusted capitation rate methodology, the agency shall
25	ensure that all of the following criteria are met:
26	1.  Agency staff is sufficiently educated and trained
27	regarding issues and methods related to compiling encounter data
28	to implement and maintain the Florida Medicaid encounter data
29	system.
30	2.  The Florida Medicaid Management Information System has
31	the capacity to house, maintain, and manage the anticipated
32	volume of encounter data records that will be produced.
33	3.  The agency has ensured that the encounter data system
34	is secure, protects personal health information, and is in
35	compliance with 45 C.F.R. ss. 160.102, 160.103, and 164, subpart
36	A, commonly referred to as the HIPAA Privacy Regulation.
37	4.  The agency has implemented a validation system to
38	ensure the encounter data is accurate; has been screened for
39	completeness, logic, and consistency; and is standardized to
40	facilitate the use of various models for the payment of claims
41	and submission of data.
42	5.  The agency has compiled no less than 1 year's worth of
43	complete encounter and diagnostic data to permit the adjustment
44	of capitation rates for health risk differences and has ensured,
45	through validation by an independent actuary, that the data are
46	of sufficient integrity to be used for risk-adjustment purposes
47	in accordance with actuarial standards of practice that are
48	generally recognized as sound and appropriate.
49	6.  The agency has consulted with the technical advisory
50	panel regarding the development and implementation of the
51	comprehensive encounter and diagnosis data system and sought
52	input from the panel.
53	7.  The risk-adjusted capitation rates have been certified
54	by an independent actuary and approved by the Centers for
55	Medicare and Medicaid Services.
56	(b)  The agency must ensure, in the first two state fiscal
57	years in which a risk-adjusted methodology is a component of
58	rate setting, that, under any risk-adjustment methodology, no
59	managed care plan providing comprehensive benefits to TANF and
60	SSI recipients under this section has an aggregate risk score
61	that varies by more than 10 percent from the aggregate weighted
62	mean of all managed care plans providing comprehensive benefits
63	to TANF and SSI recipients in a reform area. A risk-adjusted
64	capitation paid by the agency The agency's payment to a managed
65	care plan shall be based on an such revised aggregate risk score
66	revised in accordance with the provisions of this paragraph.
67	(c)  The agency may implement an interim risk-adjusted
68	capitation rate methodology to be used before a fully functional
69	encounter and diagnostic data system has been in operation for
70	no less than 12 months pursuant to paragraph (a). If the agency
71	implements an interim methodology, the capitation rates during
72	the interim period shall be weighted so that 75 percent of each
73	capitation rate is based on the methodology developed under s.
74	409.9124 and 25 percent is based on the interim risk-adjusted
75	capitation rate methodology.
76	(9)  After any calculations of aggregate risk scores or
77	revised aggregate risk scores in subsection (8) and after a
78	fully functional encounter and diagnostic data system has been
79	in operation for no less than 12 months, the capitation rates
80	for plans participating under this section shall be phased in,
81	and this phase-in schedule shall be applied anew, in its
82	entirety, in any county in which the risk-adjusted capitation
83	rate methodology is implemented, as follows:
84	(a)  For managed care plan contracts taking effect in the
85	first and second state fiscal years after a fully functional
86	encounter and diagnostic data system has been in operation for
87	no less than 12 months, the capitation rates shall be weighted
88	so that 75 percent of each capitation rate is based on the
89	methodology developed under s. 409.9124 and 25 percent is based
90	on the risk-adjusted capitation rate methodology developed under
91	subsection (8). In the first year, the capitation rates shall be
92	weighted so that 75 percent of each capitation rate is based on
93	the current methodology and 25 percent is based on a new risk-
94	adjusted capitation rate methodology.
95	(b)  For managed care plan contracts taking effect in the
96	third state fiscal year after a fully functional encounter and
97	diagnostic data system has been in operation for no less than 12
98	months, the capitation rates shall be weighted so that 70
99	percent of each capitation rate is based on the methodology
100	developed under s. 409.9124 and 30 percent is based on the risk-
101	adjusted capitation rate methodology developed under subsection
102	(8). In the second year, the capitation rates shall be weighted
103	so that 50 percent of each capitation rate is based on the
104	current methodology and 50 percent is based on a new risk-
105	adjusted rate methodology.
106	(c)  For managed care plan contracts taking effect in the
107	fourth state fiscal year after a fully functional encounter and
108	diagnostic data system has been in operation for no less than 12
109	months, the capitation rates shall be weighted so that 50
110	percent of each capitation rate is based on the methodology
111	developed under s. 409.9124 and 50 percent is based on the risk-
112	adjusted capitation rate methodology developed under subsection
113	(8).
114	(d)  For managed care plan contracts taking effect in the
115	fifth state fiscal year after a fully functional encounter and
116	diagnostic data system has been in operation for no less than 12
117	months, the capitation rates shall be weighted so that 25
118	percent of each capitation rate is based on the methodology
119	developed under s. 409.9124 and 75 percent is based on the risk-
120	adjusted capitation rate methodology developed under subsection
121	(8).
122	(e)  For managed care plan contracts taking effect in the
123	sixth state fiscal year after a fully functional encounter and
124	diagnostic data system has been in operation for no less than 12
125	months In the following fiscal year, the risk-adjusted
126	capitation methodology may be fully implemented.
127	Section 2.  This act shall take effect July 1, 2007.

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