HB 1393

1	A bill to be entitled
2	An act relating to the Medicaid managed care pilot
3	program; amending ss. 409.912 and 409.91211, F.S.;
4	deleting provisions relating to the Medicaid managed care
5	pilot program; conforming provisions; providing an
6	effective date.
7
8	Be It Enacted by the Legislature of the State of Florida:
9
10	Section 1.  Paragraphs (b) and (d) of subsection (4) and
11	subsection (34) of section 409.912, Florida Statutes, are
12	amended to read:
13	409.912  Cost-effective purchasing of health care.--The
14	agency shall purchase goods and services for Medicaid recipients
15	in the most cost-effective manner consistent with the delivery
16	of quality medical care. To ensure that medical services are
17	effectively utilized, the agency may, in any case, require a
18	confirmation or second physician's opinion of the correct
19	diagnosis for purposes of authorizing future services under the
20	Medicaid program. This section does not restrict access to
21	emergency services or poststabilization care services as defined
22	in 42 C.F.R. part 438.114. Such confirmation or second opinion
23	shall be rendered in a manner approved by the agency. The agency
24	shall maximize the use of prepaid per capita and prepaid
25	aggregate fixed-sum basis services when appropriate and other
26	alternative service delivery and reimbursement methodologies,
27	including competitive bidding pursuant to s. 287.057, designed
28	to facilitate the cost-effective purchase of a case-managed
29	continuum of care. The agency shall also require providers to
30	minimize the exposure of recipients to the need for acute
31	inpatient, custodial, and other institutional care and the
32	inappropriate or unnecessary use of high-cost services. The
33	agency shall contract with a vendor to monitor and evaluate the
34	clinical practice patterns of providers in order to identify
35	trends that are outside the normal practice patterns of a
36	provider's professional peers or the national guidelines of a
37	provider's professional association. The vendor must be able to
38	provide information and counseling to a provider whose practice
39	patterns are outside the norms, in consultation with the agency,
40	to improve patient care and reduce inappropriate utilization.
41	The agency may mandate prior authorization, drug therapy
42	management, or disease management participation for certain
43	populations of Medicaid beneficiaries, certain drug classes, or
44	particular drugs to prevent fraud, abuse, overuse, and possible
45	dangerous drug interactions. The Pharmaceutical and Therapeutics
46	Committee shall make recommendations to the agency on drugs for
47	which prior authorization is required. The agency shall inform
48	the Pharmaceutical and Therapeutics Committee of its decisions
49	regarding drugs subject to prior authorization. The agency is
50	authorized to limit the entities it contracts with or enrolls as
51	Medicaid providers by developing a provider network through
52	provider credentialing. The agency may competitively bid single-
53	source-provider contracts if procurement of goods or services
54	results in demonstrated cost savings to the state without
55	limiting access to care. The agency may limit its network based
56	on the assessment of beneficiary access to care, provider
57	availability, provider quality standards, time and distance
58	standards for access to care, the cultural competence of the
59	provider network, demographic characteristics of Medicaid
60	beneficiaries, practice and provider-to-beneficiary standards,
61	appointment wait times, beneficiary use of services, provider
62	turnover, provider profiling, provider licensure history,
63	previous program integrity investigations and findings, peer
64	review, provider Medicaid policy and billing compliance records,
65	clinical and medical record audits, and other factors. Providers
66	shall not be entitled to enrollment in the Medicaid provider
67	network. The agency shall determine instances in which allowing
68	Medicaid beneficiaries to purchase durable medical equipment and
69	other goods is less expensive to the Medicaid program than long-
70	term rental of the equipment or goods. The agency may establish
71	rules to facilitate purchases in lieu of long-term rentals in
72	order to protect against fraud and abuse in the Medicaid program
73	as defined in s. 409.913. The agency may seek federal waivers
74	necessary to administer these policies.
75	(4)  The agency may contract with:
76	(b)  An entity that is providing comprehensive behavioral
77	health care services to certain Medicaid recipients through a
78	capitated, prepaid arrangement pursuant to the federal waiver
79	provided for by s. 409.905(5). Such an entity must be licensed
80	under chapter 624, chapter 636, or chapter 641 and must possess
81	the clinical systems and operational competence to manage risk
82	and provide comprehensive behavioral health care to Medicaid
83	recipients. As used in this paragraph, the term "comprehensive
84	behavioral health care services" means covered mental health and
85	substance abuse treatment services that are available to
86	Medicaid recipients. The secretary of the Department of Children
87	and Family Services shall approve provisions of procurements
88	related to children in the department's care or custody prior to
89	enrolling such children in a prepaid behavioral health plan. Any
90	contract awarded under this paragraph must be competitively
91	procured. In developing the behavioral health care prepaid plan
92	procurement document, the agency shall ensure that the
93	procurement document requires the contractor to develop and
94	implement a plan to ensure compliance with s. 394.4574 related
95	to services provided to residents of licensed assisted living
96	facilities that hold a limited mental health license. Except as
97	provided in subparagraph 8., and except in counties where the
98	Medicaid managed care pilot program is authorized pursuant to s.
99	409.91211, the agency shall seek federal approval to contract
100	with a single entity meeting these requirements to provide
101	comprehensive behavioral health care services to all Medicaid
102	recipients not enrolled in a Medicaid managed care plan
103	authorized under s. 409.91211 or a Medicaid health maintenance
104	organization in an AHCA area. In an AHCA area where the Medicaid
105	managed care pilot program is authorized pursuant to s.
106	409.91211 in one or more counties, the agency may procure a
107	contract with a single entity to serve the remaining counties as
108	an AHCA area or the remaining counties may be included with an
109	adjacent AHCA area and shall be subject to this paragraph. Each
110	entity must offer sufficient choice of providers in its network
111	to ensure recipient access to care and the opportunity to select
112	a provider with whom they are satisfied. The network shall
113	include all public mental health hospitals. To ensure unimpaired
114	access to behavioral health care services by Medicaid
115	recipients, all contracts issued pursuant to this paragraph
116	shall require 80 percent of the capitation paid to the managed
117	care plan, including health maintenance organizations, to be
118	expended for the provision of behavioral health care services.
119	In the event the managed care plan expends less than 80 percent
120	of the capitation paid pursuant to this paragraph for the
121	provision of behavioral health care services, the difference
122	shall be returned to the agency. The agency shall provide the
123	managed care plan with a certification letter indicating the
124	amount of capitation paid during each calendar year for the
125	provision of behavioral health care services pursuant to this
126	section. The agency may reimburse for substance abuse treatment
127	services on a fee-for-service basis until the agency finds that
128	adequate funds are available for capitated, prepaid
129	arrangements.
130	1.  By January 1, 2001, the agency shall modify the
131	contracts with the entities providing comprehensive inpatient
132	and outpatient mental health care services to Medicaid
133	recipients in Hillsborough, Highlands, Hardee, Manatee, and Polk
134	Counties, to include substance abuse treatment services.
135	2.  By July 1, 2003, the agency and the Department of
136	Children and Family Services shall execute a written agreement
137	that requires collaboration and joint development of all policy,
138	budgets, procurement documents, contracts, and monitoring plans
139	that have an impact on the state and Medicaid community mental
140	health and targeted case management programs.
141	3.  Except as provided in subparagraph 8., by July 1, 2006,
142	the agency and the Department of Children and Family Services
143	shall contract with managed care entities in each AHCA area
144	except area 6 or arrange to provide comprehensive inpatient and
145	outpatient mental health and substance abuse services through
146	capitated prepaid arrangements to all Medicaid recipients who
147	are eligible to participate in such plans under federal law and
148	regulation. In AHCA areas where eligible individuals number less
149	than 150,000, the agency shall contract with a single managed
150	care plan to provide comprehensive behavioral health services to
151	all recipients who are not enrolled in a Medicaid health
152	maintenance organization or a Medicaid capitated managed care
153	plan authorized under s. 409.91211. The agency may contract with
154	more than one comprehensive behavioral health provider to
155	provide care to recipients who are not enrolled in a Medicaid
156	capitated managed care plan authorized under s. 409.91211 or a
157	Medicaid health maintenance organization in AHCA areas where the
158	eligible population exceeds 150,000. In an AHCA area where the
159	Medicaid managed care pilot program is authorized pursuant to s.
160	409.91211 in one or more counties, the agency may procure a
161	contract with a single entity to serve the remaining counties as
162	an AHCA area or the remaining counties may be included with an
163	adjacent AHCA area and shall be subject to this paragraph.
164	Contracts for comprehensive behavioral health providers awarded
165	pursuant to this section shall be competitively procured. Both
166	for-profit and not-for-profit corporations shall be eligible to
167	compete. Managed care plans contracting with the agency under
168	subsection (3) shall provide and receive payment for the same
169	comprehensive behavioral health benefits as provided in AHCA
170	rules, including handbooks incorporated by reference. In AHCA
171	area 11, the agency shall contract with at least two
172	comprehensive behavioral health care providers to provide
173	behavioral health care to recipients in that area who are
174	enrolled in, or assigned to, the MediPass program. One of the
175	behavioral health care contracts shall be with the existing
176	provider service network pilot project, as described in
177	paragraph (d), for the purpose of demonstrating the cost-
178	effectiveness of the provision of quality mental health services
179	through a public hospital-operated managed care model. Payment
180	shall be at an agreed-upon capitated rate to ensure cost
181	savings. Of the recipients in area 11 who are assigned to
182	MediPass under the provisions of s. 409.9122(2)(k), a minimum of
183	50,000 of those MediPass-enrolled recipients shall be assigned
184	to the existing provider service network in area 11 for their
185	behavioral care.
186	4.  By October 1, 2003, the agency and the department shall
187	submit a plan to the Governor, the President of the Senate, and
188	the Speaker of the House of Representatives which provides for
189	the full implementation of capitated prepaid behavioral health
190	care in all areas of the state.
191	a.  Implementation shall begin in 2003 in those AHCA areas
192	of the state where the agency is able to establish sufficient
193	capitation rates.
194	b.  If the agency determines that the proposed capitation
195	rate in any area is insufficient to provide appropriate
196	services, the agency may adjust the capitation rate to ensure
197	that care will be available. The agency and the department may
198	use existing general revenue to address any additional required
199	match but may not over-obligate existing funds on an annualized
200	basis.
201	c.  Subject to any limitations provided for in the General
202	Appropriations Act, the agency, in compliance with appropriate
203	federal authorization, shall develop policies and procedures
204	that allow for certification of local and state funds.
205	5.  Children residing in a statewide inpatient psychiatric
206	program, or in a Department of Juvenile Justice or a Department
207	of Children and Family Services residential program approved as
208	a Medicaid behavioral health overlay services provider shall not
209	be included in a behavioral health care prepaid health plan or
210	any other Medicaid managed care plan pursuant to this paragraph.
211	6.  In converting to a prepaid system of delivery, the
212	agency shall in its procurement document require an entity
213	providing only comprehensive behavioral health care services to
214	prevent the displacement of indigent care patients by enrollees
215	in the Medicaid prepaid health plan providing behavioral health
216	care services from facilities receiving state funding to provide
217	indigent behavioral health care, to facilities licensed under
218	chapter 395 which do not receive state funding for indigent
219	behavioral health care, or reimburse the unsubsidized facility
220	for the cost of behavioral health care provided to the displaced
221	indigent care patient.
222	7.  Traditional community mental health providers under
223	contract with the Department of Children and Family Services
224	pursuant to part IV of chapter 394, child welfare providers
225	under contract with the Department of Children and Family
226	Services in areas 1 and 6, and inpatient mental health providers
227	licensed pursuant to chapter 395 must be offered an opportunity
228	to accept or decline a contract to participate in any provider
229	network for prepaid behavioral health services.
230	8.  All Medicaid-eligible children, except children in area
231	1 and children in Highlands County, Hardee County, Polk County,
232	or Manatee County of area 6, who are open for child welfare
233	services in the HomeSafeNet system, shall receive their
234	behavioral health care services through a specialty prepaid plan
235	operated by community-based lead agencies either through a
236	single agency or formal agreements among several agencies. The
237	specialty prepaid plan must result in savings to the state
238	comparable to savings achieved in other Medicaid managed care
239	and prepaid programs. Such plan must provide mechanisms to
240	maximize state and local revenues. The specialty prepaid plan
241	shall be developed by the agency and the Department of Children
242	and Family Services. The agency is authorized to seek any
243	federal waivers to implement this initiative. Medicaid-eligible
244	children whose cases are open for child welfare services in the
245	HomeSafeNet system and who reside in AHCA area 10 are exempt
246	from the specialty prepaid plan upon the development of a
247	service delivery mechanism for children who reside in area 10 as
248	specified in s. 409.91211(3)(dd).
249	(d)  A provider service network may be reimbursed on a fee-
250	for-service or prepaid basis. A provider service network which
251	is reimbursed by the agency on a prepaid basis shall be exempt
252	from parts I and III of chapter 641, but must comply with the
253	solvency requirements in s. 641.2261(2) and meet appropriate
254	financial reserve, quality assurance, and patient rights
255	requirements as established by the agency. Medicaid recipients
256	assigned to a provider service network shall be chosen equally
257	from those who would otherwise have been assigned to prepaid
258	plans and MediPass. The agency is authorized to seek federal
259	Medicaid waivers as necessary to implement the provisions of
260	this section. Any contract previously awarded to a provider
261	service network operated by a hospital pursuant to this
262	subsection shall remain in effect for a period of 3 years
263	following the current contract expiration date, regardless of
264	any contractual provisions to the contrary. A provider service
265	network is a network established or organized and operated by a
266	health care provider, or group of affiliated health care
267	providers, including minority physician networks and emergency
268	room diversion programs that meet the requirements of s.
269	409.91211, which provides a substantial proportion of the health
270	care items and services under a contract directly through the
271	provider or affiliated group of providers and may make
272	arrangements with physicians or other health care professionals,
273	health care institutions, or any combination of such individuals
274	or institutions to assume all or part of the financial risk on a
275	prospective basis for the provision of basic health services by
276	the physicians, by other health professionals, or through the
277	institutions. The health care providers must have a controlling
278	interest in the governing body of the provider service network
279	organization.
280	(34)  The agency and entities that contract with the agency
281	to provide health care services to Medicaid recipients under
282	this section or s. ss. 409.91211 and 409.9122 must comply with
283	the provisions of s. 641.513 in providing emergency services and
284	care to Medicaid recipients and MediPass recipients. Where
285	feasible, safe, and cost-effective, the agency shall encourage
286	hospitals, emergency medical services providers, and other
287	public and private health care providers to work together in
288	their local communities to enter into agreements or arrangements
289	to ensure access to alternatives to emergency services and care
290	for those Medicaid recipients who need nonemergent care. The
291	agency shall coordinate with hospitals, emergency medical
292	services providers, private health plans, capitated managed care
293	networks as established in s. 409.91211, and other public and
294	private health care providers to implement the provisions of ss.
295	395.1041(7), 409.91255(3)(g), 627.6405, and 641.31097 to develop
296	and implement emergency department diversion programs for
297	Medicaid recipients.
298	Section 2.  Section 409.91211, Florida Statutes, is amended
299	to read:
300	409.91211  Medicaid managed care pilot program.--
301	(1)(a)  The agency is authorized to seek and implement
302	experimental, pilot, or demonstration project waivers, pursuant
303	to s. 1115 of the Social Security Act, to create a statewide
304	initiative to provide for a more efficient and effective service
305	delivery system that enhances quality of care and client
306	outcomes in the Florida Medicaid program pursuant to this
307	section. Phase one of the demonstration shall be implemented in
308	two geographic areas. One demonstration site shall include only
309	Broward County. A second demonstration site shall initially
310	include Duval County and shall be expanded to include Baker,
311	Clay, and Nassau Counties within 1 year after the Duval County
312	program becomes operational. The agency shall implement
313	expansion of the program to include the remaining counties of
314	the state and remaining eligibility groups in accordance with
315	the process specified in the federally approved special terms
316	and conditions numbered 11-W-00206/4, as approved by the federal
317	Centers for Medicare and Medicaid Services on October 19, 2005,
318	with a goal of full statewide implementation by June 30, 2011.
319	(b)  This waiver authority is contingent upon federal
320	approval to preserve the upper-payment-limit funding mechanism
321	for hospitals, including a guarantee of a reasonable growth
322	factor, a methodology to allow the use of a portion of these
323	funds to serve as a risk pool for demonstration sites,
324	provisions to preserve the state's ability to use
325	intergovernmental transfers, and provisions to protect the
326	disproportionate share program authorized pursuant to this
327	chapter. Upon completion of the evaluation conducted under s. 3,
328	ch. 2005-133, Laws of Florida, the agency may request statewide
329	expansion of the demonstration projects. Statewide phase-in to
330	additional counties shall be contingent upon review and approval
331	by the Legislature. Under the upper-payment-limit program, or
332	the low-income pool as implemented by the Agency for Health Care
333	Administration pursuant to federal waiver, the state matching
334	funds required for the program shall be provided by local
335	governmental entities through intergovernmental transfers in
336	accordance with published federal statutes and regulations. The
337	Agency for Health Care Administration shall distribute upper-
338	payment-limit, disproportionate share hospital, and low-income
339	pool funds according to published federal statutes, regulations,
340	and waivers and the low-income pool methodology approved by the
341	federal Centers for Medicare and Medicaid Services.
342	(2)(c)  It is the intent of the Legislature that the low-
343	income pool plan required by the terms and conditions of the
344	Medicaid reform waiver and submitted to the federal Centers for
345	Medicare and Medicaid Services propose the distribution of the
346	above-mentioned program funds based on the following objectives:
347	(a)1.  Assure a broad and fair distribution of available
348	funds based on the access provided by Medicaid participating
349	hospitals, regardless of their ownership status, through their
350	delivery of inpatient or outpatient care for Medicaid
351	beneficiaries and uninsured and underinsured individuals;
352	(b)2.  Assure accessible emergency inpatient and outpatient
353	care for Medicaid beneficiaries and uninsured and underinsured
354	individuals;
355	(c)3.  Enhance primary, preventive, and other ambulatory
356	care coverages for uninsured individuals;
357	(d)4.  Promote teaching and specialty hospital programs;
358	(e)5.  Promote the stability and viability of statutorily
359	defined rural hospitals and hospitals that serve as sole
360	community hospitals;
361	(f)6.  Recognize the extent of hospital uncompensated care
362	costs;
363	(g)7.  Maintain and enhance essential community hospital
364	care;
365	(h)8.  Maintain incentives for local governmental entities
366	to contribute to the cost of uncompensated care;
367	(i)9.  Promote measures to avoid preventable
368	hospitalizations;
369	(j)10.  Account for hospital efficiency; and
370	(k)11.  Contribute to a community's overall health system.
371	(2)  The Legislature intends for the capitated managed care
372	pilot program to:
373	(a)  Provide recipients in Medicaid fee-for-service or the
374	MediPass program a comprehensive and coordinated capitated
375	managed care system for all health care services specified in
376	ss. 409.905 and 409.906.
377	(b)  Stabilize Medicaid expenditures under the pilot
378	program compared to Medicaid expenditures in the pilot area for
379	the 3 years before implementation of the pilot program, while
380	ensuring:
381	1.  Consumer education and choice.
382	2.  Access to medically necessary services.
383	3.  Coordination of preventative, acute, and long-term
384	care.
385	4.  Reductions in unnecessary service utilization.
386	(c)  Provide an opportunity to evaluate the feasibility of
387	statewide implementation of capitated managed care networks as a
388	replacement for the current Medicaid fee-for-service and
389	MediPass systems.
390	(3)  The agency shall have the following powers, duties,
391	and responsibilities with respect to the pilot program:
392	(a)  To implement a system to deliver all mandatory
393	services specified in s. 409.905 and optional services specified
394	in s. 409.906, as approved by the Centers for Medicare and
395	Medicaid Services and the Legislature in the waiver pursuant to
396	this section. Services to recipients under plan benefits shall
397	include emergency services provided under s. 409.9128.
398	(b)  To implement a pilot program, including Medicaid
399	eligibility categories specified in ss. 409.903 and 409.904, as
400	authorized in an approved federal waiver.
401	(c)  To implement the managed care pilot program that
402	maximizes all available state and federal funds, including those
403	obtained through intergovernmental transfers, the low-income
404	pool, supplemental Medicaid payments, and the disproportionate
405	share program. Within the parameters allowed by federal statute
406	and rule, the agency may seek options for making direct payments
407	to hospitals and physicians employed by or under contract with
408	the state's medical schools for the costs associated with
409	graduate medical education under Medicaid reform.
410	(d)  To implement actuarially sound, risk-adjusted
411	capitation rates for Medicaid recipients in the pilot program
412	which cover comprehensive care, enhanced services, and
413	catastrophic care.
414	(e)  To implement policies and guidelines for phasing in
415	financial risk for approved provider service networks over a 3-
416	year period. These policies and guidelines must include an
417	option for a provider service network to be paid fee-for-service
418	rates. For any provider service network established in a managed
419	care pilot area, the option to be paid fee-for-service rates
420	shall include a savings-settlement mechanism that is consistent
421	with s. 409.912(44). This model shall be converted to a risk-
422	adjusted capitated rate no later than the beginning of the
423	fourth year of operation, and may be converted earlier at the
424	option of the provider service network. Federally qualified
425	health centers may be offered an opportunity to accept or
426	decline a contract to participate in any provider network for
427	prepaid primary care services.
428	(f)  To implement stop-loss requirements and the transfer
429	of excess cost to catastrophic coverage that accommodates the
430	risks associated with the development of the pilot program.
431	(g)  To recommend a process to be used by the Social
432	Services Estimating Conference to determine and validate the
433	rate of growth of the per-member costs of providing Medicaid
434	services under the managed care pilot program.
435	(h)  To implement program standards and credentialing
436	requirements for capitated managed care networks to participate
437	in the pilot program, including those related to fiscal
438	solvency, quality of care, and adequacy of access to health care
439	providers. It is the intent of the Legislature that, to the
440	extent possible, any pilot program authorized by the state under
441	this section include any federally qualified health center,
442	federally qualified rural health clinic, county health
443	department, the Children's Medical Services Network within the
444	Department of Health, or other federally, state, or locally
445	funded entity that serves the geographic areas within the
446	boundaries of the pilot program that requests to participate.
447	This paragraph does not relieve an entity that qualifies as a
448	capitated managed care network under this section from any other
449	licensure or regulatory requirements contained in state or
450	federal law which would otherwise apply to the entity. The
451	standards and credentialing requirements shall be based upon,
452	but are not limited to:
453	1.  Compliance with the accreditation requirements as
454	provided in s. 641.512.
455	2.  Compliance with early and periodic screening,
456	diagnosis, and treatment screening requirements under federal
457	law.
458	3.  The percentage of voluntary disenrollments.
459	4.  Immunization rates.
460	5.  Standards of the National Committee for Quality
461	Assurance and other approved accrediting bodies.
462	6.  Recommendations of other authoritative bodies.
463	7.  Specific requirements of the Medicaid program, or
464	standards designed to specifically meet the unique needs of
465	Medicaid recipients.
466	8.  Compliance with the health quality improvement system
467	as established by the agency, which incorporates standards and
468	guidelines developed by the Centers for Medicare and Medicaid
469	Services as part of the quality assurance reform initiative.
470	9.  The network's infrastructure capacity to manage
471	financial transactions, recordkeeping, data collection, and
472	other administrative functions.
473	10.  The network's ability to submit any financial,
474	programmatic, or patient-encounter data or other information
475	required by the agency to determine the actual services provided
476	and the cost of administering the plan.
477	(i)  To implement a mechanism for providing information to
478	Medicaid recipients for the purpose of selecting a capitated
479	managed care plan. For each plan available to a recipient, the
480	agency, at a minimum, shall ensure that the recipient is
481	provided with:
482	1.  A list and description of the benefits provided.
483	2.  Information about cost sharing.
484	3.  Plan performance data, if available.
485	4.  An explanation of benefit limitations.
486	5.  Contact information, including identification of
487	providers participating in the network, geographic locations,
488	and transportation limitations.
489	6.  Any other information the agency determines would
490	facilitate a recipient's understanding of the plan or insurance
491	that would best meet his or her needs.
492	(j)  To implement a system to ensure that there is a record
493	of recipient acknowledgment that choice counseling has been
494	provided.
495	(k)  To implement a choice counseling system to ensure that
496	the choice counseling process and related material are designed
497	to provide counseling through face-to-face interaction, by
498	telephone, and in writing and through other forms of relevant
499	media. Materials shall be written at the fourth-grade reading
500	level and available in a language other than English when 5
501	percent of the county speaks a language other than English.
502	Choice counseling shall also use language lines and other
503	services for impaired recipients, such as TTD/TTY.
504	(l)  To implement a system that prohibits capitated managed
505	care plans, their representatives, and providers employed by or
506	contracted with the capitated managed care plans from recruiting
507	persons eligible for or enrolled in Medicaid, from providing
508	inducements to Medicaid recipients to select a particular
509	capitated managed care plan, and from prejudicing Medicaid
510	recipients against other capitated managed care plans. The
511	system shall require the entity performing choice counseling to
512	determine if the recipient has made a choice of a plan or has
513	opted out because of duress, threats, payment to the recipient,
514	or incentives promised to the recipient by a third party. If the
515	choice counseling entity determines that the decision to choose
516	a plan was unlawfully influenced or a plan violated any of the
517	provisions of s. 409.912(21), the choice counseling entity shall
518	immediately report the violation to the agency's program
519	integrity section for investigation. Verification of choice
520	counseling by the recipient shall include a stipulation that the
521	recipient acknowledges the provisions of this subsection.
522	(m)  To implement a choice counseling system that promotes
523	health literacy and provides information aimed to reduce
524	minority health disparities through outreach activities for
525	Medicaid recipients.
526	(n)  To contract with entities to perform choice
527	counseling. The agency may establish standards and performance
528	contracts, including standards requiring the contractor to hire
529	choice counselors who are representative of the state's diverse
530	population and to train choice counselors in working with
531	culturally diverse populations.
532	(o)  To implement eligibility assignment processes to
533	facilitate client choice while ensuring pilot programs of
534	adequate enrollment levels. These processes shall ensure that
535	pilot sites have sufficient levels of enrollment to conduct a
536	valid test of the managed care pilot program within a 2-year
537	timeframe.
538	(p)  To implement standards for plan compliance, including,
539	but not limited to, standards for quality assurance and
540	performance improvement, standards for peer or professional
541	reviews, grievance policies, and policies for maintaining
542	program integrity. The agency shall develop a data-reporting
543	system, seek input from managed care plans in order to establish
544	requirements for patient-encounter reporting, and ensure that
545	the data reported is accurate and complete.
546	1.  In performing the duties required under this section,
547	the agency shall work with managed care plans to establish a
548	uniform system to measure and monitor outcomes for a recipient
549	of Medicaid services.
550	2.  The system shall use financial, clinical, and other
551	criteria based on pharmacy, medical services, and other data
552	that is related to the provision of Medicaid services,
553	including, but not limited to:
554	a.  The Health Plan Employer Data and Information Set
555	(HEDIS) or measures that are similar to HEDIS.
556	b.  Member satisfaction.
557	c.  Provider satisfaction.
558	d.  Report cards on plan performance and best practices.
559	e.  Compliance with the requirements for prompt payment of
560	claims under ss. 627.613, 641.3155, and 641.513.
561	f.  Utilization and quality data for the purpose of
562	ensuring access to medically necessary services, including
563	underutilization or inappropriate denial of services.
564	3.  The agency shall require the managed care plans that
565	have contracted with the agency to establish a quality assurance
566	system that incorporates the provisions of s. 409.912(27) and
567	any standards, rules, and guidelines developed by the agency.
568	4.  The agency shall establish an encounter database in
569	order to compile data on health services rendered by health care
570	practitioners who provide services to patients enrolled in
571	managed care plans in the demonstration sites. The encounter
572	database shall:
573	a.  Collect the following for each type of patient
574	encounter with a health care practitioner or facility,
575	including:
576	(I)  The demographic characteristics of the patient.
577	(II)  The principal, secondary, and tertiary diagnosis.
578	(III)  The procedure performed.
579	(IV)  The date and location where the procedure was
580	performed.
581	(V)  The payment for the procedure, if any.
582	(VI)  If applicable, the health care practitioner's
583	universal identification number.
584	(VII)  If the health care practitioner rendering the
585	service is a dependent practitioner, the modifiers appropriate
586	to indicate that the service was delivered by the dependent
587	practitioner.
588	b.  Collect appropriate information relating to
589	prescription drugs for each type of patient encounter.
590	c.  Collect appropriate information related to health care
591	costs and utilization from managed care plans participating in
592	the demonstration sites.
593	5.  To the extent practicable, when collecting the data the
594	agency shall use a standardized claim form or electronic
595	transfer system that is used by health care practitioners,
596	facilities, and payors.
597	6.  Health care practitioners and facilities in the
598	demonstration sites shall electronically submit, and managed
599	care plans participating in the demonstration sites shall
600	electronically receive, information concerning claims payments
601	and any other information reasonably related to the encounter
602	database using a standard format as required by the agency.
603	7.  The agency shall establish reasonable deadlines for
604	phasing in the electronic transmittal of full encounter data.
605	8.  The system must ensure that the data reported is
606	accurate and complete.
607	(q)  To implement a grievance resolution process for
608	Medicaid recipients enrolled in a capitated managed care network
609	under the pilot program modeled after the subscriber assistance
610	panel, as created in s. 408.7056. This process shall include a
611	mechanism for an expedited review of no greater than 24 hours
612	after notification of a grievance if the life of a Medicaid
613	recipient is in imminent and emergent jeopardy.
614	(r)  To implement a grievance resolution process for health
615	care providers employed by or contracted with a capitated
616	managed care network under the pilot program in order to settle
617	disputes among the provider and the managed care network or the
618	provider and the agency.
619	(s)  To implement criteria in an approved federal waiver to
620	designate health care providers as eligible to participate in
621	the pilot program. These criteria must include at a minimum
622	those criteria specified in s. 409.907.
623	(t)  To use health care provider agreements for
624	participation in the pilot program.
625	(u)  To require that all health care providers under
626	contract with the pilot program be duly licensed in the state,
627	if such licensure is available, and meet other criteria as may
628	be established by the agency. These criteria shall include at a
629	minimum those criteria specified in s. 409.907.
630	(v)  To ensure that managed care organizations work
631	collaboratively with other state or local governmental programs
632	or institutions for the coordination of health care to eligible
633	individuals receiving services from such programs or
634	institutions.
635	(w)  To implement procedures to minimize the risk of
636	Medicaid fraud and abuse in all plans operating in the Medicaid
637	managed care pilot program authorized in this section.
638	1.  The agency shall ensure that applicable provisions of
639	this chapter and chapters 414, 626, 641, and 932 which relate to
640	Medicaid fraud and abuse are applied and enforced at the
641	demonstration project sites.
642	2.  Providers must have the certification, license, and
643	credentials that are required by law and waiver requirements.
644	3.  The agency shall ensure that the plan is in compliance
645	with s. 409.912(21) and (22).
646	4.  The agency shall require that each plan establish
647	functions and activities governing program integrity in order to
648	reduce the incidence of fraud and abuse. Plans must report
649	instances of fraud and abuse pursuant to chapter 641.
650	5.  The plan shall have written administrative and
651	management arrangements or procedures, including a mandatory
652	compliance plan, which are designed to guard against fraud and
653	abuse. The plan shall designate a compliance officer who has
654	sufficient experience in health care.
655	6.a.  The agency shall require all managed care plan
656	contractors in the pilot program to report all instances of
657	suspected fraud and abuse. A failure to report instances of
658	suspected fraud and abuse is a violation of law and subject to
659	the penalties provided by law.
660	b.  An instance of fraud and abuse in the managed care
661	plan, including, but not limited to, defrauding the state health
662	care benefit program by misrepresentation of fact in reports,
663	claims, certifications, enrollment claims, demographic
664	statistics, or patient-encounter data; misrepresentation of the
665	qualifications of persons rendering health care and ancillary
666	services; bribery and false statements relating to the delivery
667	of health care; unfair and deceptive marketing practices; and
668	false claims actions in the provision of managed care, is a
669	violation of law and subject to the penalties provided by law.
670	c.  The agency shall require that all contractors make all
671	files and relevant billing and claims data accessible to state
672	regulators and investigators and that all such data is linked
673	into a unified system to ensure consistent reviews and
674	investigations.
675	(x)  To develop and provide actuarial and benefit design
676	analyses that indicate the effect on capitation rates and
677	benefits offered in the pilot program over a prospective 5-year
678	period based on the following assumptions:
679	1.  Growth in capitation rates which is limited to the
680	estimated growth rate in general revenue.
681	2.  Growth in capitation rates which is limited to the
682	average growth rate over the last 3 years in per-recipient
683	Medicaid expenditures.
684	3.  Growth in capitation rates which is limited to the
685	growth rate of aggregate Medicaid expenditures between the 2003-
686	2004 fiscal year and the 2004-2005 fiscal year.
687	(y)  To develop a mechanism to require capitated managed
688	care plans to reimburse qualified emergency service providers,
689	including, but not limited to, ambulance services, in accordance
690	with ss. 409.908 and 409.9128. The pilot program must include a
691	provision for continuing fee-for-service payments for emergency
692	services, including, but not limited to, individuals who access
693	ambulance services or emergency departments and who are
694	subsequently determined to be eligible for Medicaid services.
695	(z)  To ensure that school districts participating in the
696	certified school match program pursuant to ss. 409.908(21) and
697	1011.70 shall be reimbursed by Medicaid, subject to the
698	limitations of s. 1011.70(1), for a Medicaid-eligible child
699	participating in the services as authorized in s. 1011.70, as
700	provided for in s. 409.9071, regardless of whether the child is
701	enrolled in a capitated managed care network. Capitated managed
702	care networks must make a good faith effort to execute
703	agreements with school districts regarding the coordinated
704	provision of services authorized under s. 1011.70. County health
705	departments and federally qualified health centers delivering
706	school-based services pursuant to ss. 381.0056 and 381.0057 must
707	be reimbursed by Medicaid for the federal share for a Medicaid-
708	eligible child who receives Medicaid-covered services in a
709	school setting, regardless of whether the child is enrolled in a
710	capitated managed care network. Capitated managed care networks
711	must make a good faith effort to execute agreements with county
712	health departments and federally qualified health centers
713	regarding the coordinated provision of services to a Medicaid-
714	eligible child. To ensure continuity of care for Medicaid
715	patients, the agency, the Department of Health, and the
716	Department of Education shall develop procedures for ensuring
717	that a student's capitated managed care network provider
718	receives information relating to services provided in accordance
719	with ss. 381.0056, 381.0057, 409.9071, and 1011.70.
720	(aa)  To implement a mechanism whereby Medicaid recipients
721	who are already enrolled in a managed care plan or the MediPass
722	program in the pilot areas shall be offered the opportunity to
723	change to capitated managed care plans on a staggered basis, as
724	defined by the agency. All Medicaid recipients shall have 30
725	days in which to make a choice of capitated managed care plans.
726	Those Medicaid recipients who do not make a choice shall be
727	assigned to a capitated managed care plan in accordance with
728	paragraph (4)(a) and shall be exempt from s. 409.9122. To
729	facilitate continuity of care for a Medicaid recipient who is
730	also a recipient of Supplemental Security Income (SSI), prior to
731	assigning the SSI recipient to a capitated managed care plan,
732	the agency shall determine whether the SSI recipient has an
733	ongoing relationship with a provider or capitated managed care
734	plan, and, if so, the agency shall assign the SSI recipient to
735	that provider or capitated managed care plan where feasible.
736	Those SSI recipients who do not have such a provider
737	relationship shall be assigned to a capitated managed care plan
738	provider in accordance with paragraph (4)(a) and shall be exempt
739	from s. 409.9122.
740	(bb)  To develop and recommend a service delivery
741	alternative for children having chronic medical conditions which
742	establishes a medical home project to provide primary care
743	services to this population. The project shall provide
744	community-based primary care services that are integrated with
745	other subspecialties to meet the medical, developmental, and
746	emotional needs for children and their families. This project
747	shall include an evaluation component to determine impacts on
748	hospitalizations, length of stays, emergency room visits, costs,
749	and access to care, including specialty care and patient and
750	family satisfaction.
751	(cc)  To develop and recommend service delivery mechanisms
752	within capitated managed care plans to provide Medicaid services
753	as specified in ss. 409.905 and 409.906 to persons with
754	developmental disabilities sufficient to meet the medical,
755	developmental, and emotional needs of these persons.
756	(dd)  To implement service delivery mechanisms within
757	capitated managed care plans to provide Medicaid services as
758	specified in ss. 409.905 and 409.906 to Medicaid-eligible
759	children whose cases are open for child welfare services in the
760	HomeSafeNet system. These services must be coordinated with
761	community-based care providers as specified in s. 409.1671,
762	where available, and be sufficient to meet the medical,
763	developmental, behavioral, and emotional needs of these
764	children. These service delivery mechanisms must be implemented
765	no later than July 1, 2008, in AHCA area 10 in order for the
766	children in AHCA area 10 to remain exempt from the statewide
767	plan under s. 409.912(4)(b)8.
768	(4)(a)  A Medicaid recipient in the pilot area who is not
769	currently enrolled in a capitated managed care plan upon
770	implementation is not eligible for services as specified in ss.
771	409.905 and 409.906, for the amount of time that the recipient
772	does not enroll in a capitated managed care network. If a
773	Medicaid recipient has not enrolled in a capitated managed care
774	plan within 30 days after eligibility, the agency shall assign
775	the Medicaid recipient to a capitated managed care plan based on
776	the assessed needs of the recipient as determined by the agency
777	and the recipient shall be exempt from s. 409.9122. When making
778	assignments, the agency shall take into account the following
779	criteria:
780	1.  A capitated managed care network has sufficient network
781	capacity to meet the needs of members.
782	2.  The capitated managed care network has previously
783	enrolled the recipient as a member, or one of the capitated
784	managed care network's primary care providers has previously
785	provided health care to the recipient.
786	3.  The agency has knowledge that the member has previously
787	expressed a preference for a particular capitated managed care
788	network as indicated by Medicaid fee-for-service claims data,
789	but has failed to make a choice.
790	4.  The capitated managed care network's primary care
791	providers are geographically accessible to the recipient's
792	residence.
793	(b)  When more than one capitated managed care network
794	provider meets the criteria specified in paragraph (3)(h), the
795	agency shall make recipient assignments consecutively by family
796	unit.
797	(c)  If a recipient is currently enrolled with a Medicaid
798	managed care organization that also operates an approved reform
799	plan within a demonstration area and the recipient fails to
800	choose a plan during the reform enrollment process or during
801	redetermination of eligibility, the recipient shall be
802	automatically assigned by the agency into the most appropriate
803	reform plan operated by the recipient's current Medicaid managed
804	care plan. If the recipient's current managed care plan does not
805	operate a reform plan in the demonstration area which adequately
806	meets the needs of the Medicaid recipient, the agency shall use
807	the automatic assignment process as prescribed in the special
808	terms and conditions numbered 11-W-00206/4. All enrollment and
809	choice counseling materials provided by the agency must contain
810	an explanation of the provisions of this paragraph for current
811	managed care recipients.
812	(d)  The agency may not engage in practices that are
813	designed to favor one capitated managed care plan over another
814	or that are designed to influence Medicaid recipients to enroll
815	in a particular capitated managed care network in order to
816	strengthen its particular fiscal viability.
817	(e)  After a recipient has made a selection or has been
818	enrolled in a capitated managed care network, the recipient
819	shall have 90 days in which to voluntarily disenroll and select
820	another capitated managed care network. After 90 days, no
821	further changes may be made except for cause. Cause shall
822	include, but not be limited to, poor quality of care, lack of
823	access to necessary specialty services, an unreasonable delay or
824	denial of service, inordinate or inappropriate changes of
825	primary care providers, service access impairments due to
826	significant changes in the geographic location of services, or
827	fraudulent enrollment. The agency may require a recipient to use
828	the capitated managed care network's grievance process as
829	specified in paragraph (3)(q) prior to the agency's
830	determination of cause, except in cases in which immediate risk
831	of permanent damage to the recipient's health is alleged. The
832	grievance process, when used, must be completed in time to
833	permit the recipient to disenroll no later than the first day of
834	the second month after the month the disenrollment request was
835	made. If the capitated managed care network, as a result of the
836	grievance process, approves an enrollee's request to disenroll,
837	the agency is not required to make a determination in the case.
838	The agency must make a determination and take final action on a
839	recipient's request so that disenrollment occurs no later than
840	the first day of the second month after the month the request
841	was made. If the agency fails to act within the specified
842	timeframe, the recipient's request to disenroll is deemed to be
843	approved as of the date agency action was required. Recipients
844	who disagree with the agency's finding that cause does not exist
845	for disenrollment shall be advised of their right to pursue a
846	Medicaid fair hearing to dispute the agency's finding.
847	(f)  The agency shall apply for federal waivers from the
848	Centers for Medicare and Medicaid Services to lock eligible
849	Medicaid recipients into a capitated managed care network for 12
850	months after an open enrollment period. After 12 months of
851	enrollment, a recipient may select another capitated managed
852	care network. However, nothing shall prevent a Medicaid
853	recipient from changing primary care providers within the
854	capitated managed care network during the 12-month period.
855	(g)  The agency shall apply for federal waivers from the
856	Centers for Medicare and Medicaid Services to allow recipients
857	to purchase health care coverage through an employer-sponsored
858	health insurance plan instead of through a Medicaid-certified
859	plan. This provision shall be known as the opt-out option.
860	1.  A recipient who chooses the Medicaid opt-out option
861	shall have an opportunity for a specified period of time, as
862	authorized under a waiver granted by the Centers for Medicare
863	and Medicaid Services, to select and enroll in a Medicaid-
864	certified plan. If the recipient remains in the employer-
865	sponsored plan after the specified period, the recipient shall
866	remain in the opt-out program for at least 1 year or until the
867	recipient no longer has access to employer-sponsored coverage,
868	until the employer's open enrollment period for a person who
869	opts out in order to participate in employer-sponsored coverage,
870	or until the person is no longer eligible for Medicaid,
871	whichever time period is shorter.
872	2.  Notwithstanding any other provision of this section,
873	coverage, cost sharing, and any other component of employer-
874	sponsored health insurance shall be governed by applicable state
875	and federal laws.
876	(5)  This section does not authorize the agency to
877	implement any provision of s. 1115 of the Social Security Act
878	experimental, pilot, or demonstration project waiver to reform
879	the state Medicaid program in any part of the state other than
880	the two geographic areas specified in this section unless
881	approved by the Legislature.
882	(6)  The agency shall develop and submit for approval
883	applications for waivers of applicable federal laws and
884	regulations as necessary to implement the managed care pilot
885	project as defined in this section. The agency shall post all
886	waiver applications under this section on its Internet website
887	30 days before submitting the applications to the United States
888	Centers for Medicare and Medicaid Services. All waiver
889	applications shall be provided for review and comment to the
890	appropriate committees of the Senate and House of
891	Representatives for at least 10 working days prior to
892	submission. All waivers submitted to and approved by the United
893	States Centers for Medicare and Medicaid Services under this
894	section must be approved by the Legislature. Federally approved
895	waivers must be submitted to the President of the Senate and the
896	Speaker of the House of Representatives for referral to the
897	appropriate legislative committees. The appropriate committees
898	shall recommend whether to approve the implementation of any
899	waivers to the Legislature as a whole. The agency shall submit a
900	plan containing a recommended timeline for implementation of any
901	waivers and budgetary projections of the effect of the pilot
902	program under this section on the total Medicaid budget for the
903	2006-2007 through 2009-2010 state fiscal years. This
904	implementation plan shall be submitted to the President of the
905	Senate and the Speaker of the House of Representatives at the
906	same time any waivers are submitted for consideration by the
907	Legislature. The agency may implement the waiver and special
908	terms and conditions numbered 11-W-00206/4, as approved by the
909	federal Centers for Medicare and Medicaid Services. If the
910	agency seeks approval by the Federal Government of any
911	modifications to these special terms and conditions, the agency
912	must provide written notification of its intent to modify these
913	terms and conditions to the President of the Senate and the
914	Speaker of the House of Representatives at least 15 days before
915	submitting the modifications to the Federal Government for
916	consideration. The notification must identify all modifications
917	being pursued and the reason the modifications are needed. Upon
918	receiving federal approval of any modifications to the special
919	terms and conditions, the agency shall provide a report to the
920	Legislature describing the federally approved modifications to
921	the special terms and conditions within 7 days after approval by
922	the Federal Government.
923	(7)(a)  The Secretary of Health Care Administration shall
924	convene a technical advisory panel to advise the agency in the
925	areas of risk-adjusted-rate setting, benefit design, and choice
926	counseling. The panel shall include representatives from the
927	Florida Association of Health Plans, representatives from
928	provider-sponsored networks, a Medicaid consumer representative,
929	and a representative from the Office of Insurance Regulation.
930	(b)  The technical advisory panel shall advise the agency
931	concerning:
932	1.  The risk-adjusted rate methodology to be used by the
933	agency, including recommendations on mechanisms to recognize the
934	risk of all Medicaid enrollees and for the transition to a risk-
935	adjustment system, including recommendations for phasing in risk
936	adjustment and the use of risk corridors.
937	2.  Implementation of an encounter data system to be used
938	for risk-adjusted rates.
939	3.  Administrative and implementation issues regarding the
940	use of risk-adjusted rates, including, but not limited to, cost,
941	simplicity, client privacy, data accuracy, and data exchange.
942	4.  Issues of benefit design, including the actuarial
943	equivalence and sufficiency standards to be used.
944	5.  The implementation plan for the proposed choice-
945	counseling system, including the information and materials to be
946	provided to recipients, the methodologies by which recipients
947	will be counseled regarding choice, criteria to be used to
948	assess plan quality, the methodology to be used to assign
949	recipients into plans if they fail to choose a managed care
950	plan, and the standards to be used for responsiveness to
951	recipient inquiries.
952	(c)  The technical advisory panel shall continue in
953	existence and advise the agency on matters outlined in this
954	subsection.
955	(8)  The agency must ensure, in the first two state fiscal
956	years in which a risk-adjusted methodology is a component of
957	rate setting, that no managed care plan providing comprehensive
958	benefits to TANF and SSI recipients has an aggregate risk score
959	that varies by more than 10 percent from the aggregate weighted
960	mean of all managed care plans providing comprehensive benefits
961	to TANF and SSI recipients in a reform area. The agency's
962	payment to a managed care plan shall be based on such revised
963	aggregate risk score.
964	(9)  After any calculations of aggregate risk scores or
965	revised aggregate risk scores in subsection (8), the capitation
966	rates for plans participating under this section shall be phased
967	in as follows:
968	(a)  In the first year, the capitation rates shall be
969	weighted so that 75 percent of each capitation rate is based on
970	the current methodology and 25 percent is based on a new risk-
971	adjusted capitation rate methodology.
972	(b)  In the second year, the capitation rates shall be
973	weighted so that 50 percent of each capitation rate is based on
974	the current methodology and 50 percent is based on a new risk-
975	adjusted rate methodology.
976	(c)  In the following fiscal year, the risk-adjusted
977	capitation methodology may be fully implemented.
978	(10)  Subsections (8) and (9) do not apply to managed care
979	plans offering benefits exclusively to high-risk, specialty
980	populations. The agency may set risk-adjusted rates immediately
981	for such plans.
982	(11)  Before the implementation of risk-adjusted rates, the
983	rates shall be certified by an actuary and approved by the
984	federal Centers for Medicare and Medicaid Services.
985	(12)  For purposes of this section, the term "capitated
986	managed care plan" includes health insurers authorized under
987	chapter 624, exclusive provider organizations authorized under
988	chapter 627, health maintenance organizations authorized under
989	chapter 641, the Children's Medical Services Network under
990	chapter 391, and provider service networks that elect to be paid
991	fee-for-service for up to 3 years as authorized under this
992	section.
993	(13)  Upon review and approval of the applications for
994	waivers of applicable federal laws and regulations to implement
995	the managed care pilot program by the Legislature, the agency
996	may initiate adoption of rules pursuant to ss. 120.536(1) and
997	120.54 to implement and administer the managed care pilot
998	program as provided in this section.
999	(14)  It is the intent of the Legislature that if any
1000	conflict exists between the provisions contained in this section
1001	and other provisions of this chapter which relate to the
1002	implementation of the Medicaid managed care pilot program, the
1003	provisions contained in this section shall control. The agency
1004	shall provide a written report to the Legislature by April 1,
1005	2006, identifying any provisions of this chapter which conflict
1006	with the implementation of the Medicaid managed care pilot
1007	program created in this section. After April 1, 2006, the agency
1008	shall provide a written report to the Legislature immediately
1009	upon identifying any provisions of this chapter which conflict
1010	with the implementation of the Medicaid managed care pilot
1011	program created in this section.
1012	Section 3.  This act shall take effect July 1, 2009.

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