Health Care

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Health Insurance Programs Promoting Wellness

Regulation
Wednesday, January 14, 2009
Reg-H-2008-05

File attachments: 

http://www.dfr.vermont.gov/sites/default/files/REG-H-08-05.pdf

This Rule authorizes the creation of small group and nongroup plans that promote wellness through the offering of discounts and other incentives.

Vermont Healthcare Claims Uniform Reporting and Evaluation System ("VHCURES")

Regulation
Tuesday, September 30, 2008
Reg-H-2008-01

File attachments: 

http://www.dfr.vermont.gov/sites/default/files/REG-H-08-01.pdf

REGULATION H-2008-01

Vermont Healthcare Claims Uniform Reporting and Evaluation System (“VHCURES”)

 

Section 1: Purpose

The purpose of this rule is to set forth the requirements for the submission of health care claims data, member eligibility data, and other information relating to health care provided to Vermont residents or by Vermont health care providers and facilities by health insurers, managed care organizations, third party administrators, pharmacy benefit managers and others to the Department of Banking, Insurance, Securities and Health Care

Administration and conditions for the use and dissemination of such claims data, all as required by and consistent with the purposes of 18 V.S.A. §9410.

Section 2: Authority

This rule is issued pursuant to the authority vested in the Commissioner of the Department of Banking, Insurance, Securities and Health Care Administration by 18

V.S.A. §9410, as well as 8 V.S.A. §15 and other applicable portions of Chapter 221 of Title 18.

Sectio n 3: Definitions

As used in this Rule

A. “BISHCA” or “Department” means the Vermont Department of Banking, Insurance, Securities and Health Care Administration.

B. “Capitated services” means services rendered by a provider through a contract in which payment are based upon a fixed dollar amount for each member on a monthly basis.

C. “Cell size” means the count of persons that share a set of characteristics contained in a statistical table.

D. “Charge” means the actual dollar amount charged on the claim.

E. "Co-insurance" means the percentage a member pays toward the cost of a covered service.

F. “Commissioner” means the commissioner of the Department of Banking, Insurance, Securities and Health Care Administration or his or her designee.

G. "Co-payment" means the fixed dollar amount a member pays to a health care provider at the time a covered service is provided or the full cost of a service when that is less than the fixed dollar amount.

H. “Current Procedural Terminology (CPT)” means a medical code set of physician and other services, maintained and copyrighted by the American Medical Association (AMA), and adopted by the U.S. Secretary of Health and Human Services as the standard for reporting physician and other services on standard transactions.

I. “Data set” means a collection of individual data records, whether in electronic or manual files.

J. “Deductible” means the total dollar amount a member pays towards the cost of covered services over an established period of time before the contracted third- party payer makes any payments.

K. “De-identified health information” means information that does not identify an individual patient, member or enrollee and with respect to which no reasonable basis exists to believe that the information can be used to identify an individual patient, member or enrollee. De-identification means that health information is not individually identifiable and requires the removal of Direct Personal Identifiers associated with patients, members or enrollees.

L. “Direct personal identifiers” is information relating to an individual patient, member or enrollee that contains primary or obvious identifiers, including:

(1) Names;

(2) Business names when that name would serve to identify a person;

(3) Postal address information other than town or city, state, and 5-digit zip code;

(4) Specific latitude and longitude or other geographic information that would be used to derive postal address;

(5) Telephone and fax numbers;

(6) Electronic mail addresses;

(7) Social security numbers;

(8) Vehicle Identifiers and serial numbers, including license plate numbers;

(9) Medical record numbers;

(10) Health plan beneficiary numbers;

(11) Certificate and license numbers;

(12) Internet protocol (IP) addresses and uniform resource locators (URL) that identify a business that would serve to identify a person;

(13) Biometric identifiers, including finger and voice prints; and

(14) Personal photographic images.

M. “Disclosure” means the release, transfer, provision of access to, or divulging in any other manner of information outside the entity holding the information.

N. “Encrypted identifier” is a code or other means of record identification to allow patients, members or enrollees to be tracked across the data set without revealing their identity. Encrypted identifiers are not direct identifiers.

O. "Encryption" means a method by which the true value of data has been disguised in order to prevent the identification of persons or groups, and which does not provide the means for recovering the true value of the data.

P. “Health benefit plan” means a policy, contract, certificate or agreement entered into, or offered by a health insurer to provide, deliver, arrange for, pay for or reimburse any of the costs of health care services.

Q. “Healthcare claims data” means information consisting of or derived directly from member eligibility files, medical claims files, pharmacy claims files and other related data pursuant to the Vermont Healthcare Claims Uniform Reporting and Evaluation System (VHCURES) in effect at the time of the data submission. “Healthcare claims data” does not include analysis, reports, or studies containing information from health care claims data sets if those analyses, reports, or studies have already been released in response to another request for information or as part of a general distribution of public information by BISHCA.

R. “Healthcare premium” means the dollar amount charged for any policies offered by health insurers which partially or fully cover the cost of health care services.

S. “Healthcare Common Procedure Coding System (HCPCS)” means a medical code set that identifies health care procedures, equipment, and supplies for claim submission purposes. These are often known as "local codes".

T. “Health care” means care, services, or supplies related to the health of an individual. It includes but is not limited to (1) preventive, diagnostic, therapeutic, rehabilitative, maintenance, or palliative care, and counseling, service, assessment, or procedure with respect to the physical or mental condition, or functional status, of an individual or that affects the structure or function of the body; and (2) sale or dispensing of a drug, device, equipment, or other item in accordance with a prescription [45 CFR § 160.103].

U. “Health care facility” shall be defined as per 18 V.S.A §9432, as amended from time to time.

V. "Health care provider" means a person, partnership, corporation, facility or institution, licensed or certified or authorized by law to provide professional health care service in this state to an individual during that individual's medical care, treatment or confinement, as per 18 V.S.A. §9432.

W. “Health information” means any information, whether oral or recorded in any form or medium, that 1) is created or received by a health-care provider, health plan, public health authority, employer, life insurer, school or university, or health-care clearinghouse; and 2) relates to the past, present, or future physical or mental health or condition of an individual, the provision of health care to an individual, or the past, present, or future payment for the provision of health care to an individual shall be as defined in 45 CFR § 160.103.

X. “Health insurer” means those entities defined in 18 V.S.A. §§ 9402 and 9410(j)(1), and includes any health insurance company, nonprofit hospital and medical service corporation, managed care organization, third party administrator, pharmacy benefit manager, and any entity conducting administrative services for business or possessing claims data, eligibility data, provider files, and other information relating to health care provided to Vermont residents or by Vermont health care providers and facilities. The term may also include, to the extent permitted under federal law, any administrator of an insured, self-insured, or publicly funded health care benefit plan offered by public and private entities.

Y. “HIPAA” means the federal Health Insurance Portability and Accountability Act of 1996, Public Law 104-191.

Z. “Indirect personal identifiers” means information relating to an individual patient, member or enrollee that a person with appropriate knowledge of and experience with generally accepted statistical and scientific principles and methods could apply to render such information individually identifiable by using such information alone or in combination with other reasonably available information.

Aa. “International Classification of Diseases” or “ICD” shall mean that medical code set maintained by the World Health Organization..

Ab. “Mandated Reporter” means a health insurer as defined herein and at 18 V.S.A.

§9410(j)(1) with two hundred (200) or more enrolled or covered members in each month during a calendar year, including both Vermont residents and any non- residents receiving covered services provided by Vermont health care providers and facilities.

Ac. “Medical claims file” means a data file composed of service level remittance information for all non-denied adjudicated claims for each billed service including, but not limited to member demographics, provider information, charge/payment information, and clinical diagnosis and procedure codes, and shall include all claims related to behavioral or mental health.

Ad. “Member” means the insured subscriber and any spouse and/or dependent covered by the subscriber's policy.

Ae. “Member eligibility file” means a data file containing demographic information for each individual member eligible for medical or pharmacy benefits for one or more days of coverage at any time during the reporting month.

Af. “Patient” means any person in the data set that is the subject of the activities of the claim performed by the health care provider.

Ag. “Payer” means a third-party payer or third-party administrator.

Ah. “Payment” means the actual dollar amount paid for a claim by a health insurer.

Ai. “Personal identifiers” means information relating to an individual that contains direct or indirect identifiers to which a reasonable basis exists to believe that the information can be used to identify an individual.

Aj. “Pharmacy Benefit Manager” or “PBM” means a person or entity that performs pharmacy benefit management as that term is defined at 18 V.S.A. §9471(4). The term includes a person or entity in a contractual or employment relationship with an entity performing pharmacy benefit management for a health plan.

Ak. “Pharmacy claims file” means a data file containing service level remittance information from all non-denied adjudicated claims for each prescription including, but not limited to: member demographics; provider information; charge/payment information; and national drug codes.

Al. "Prepaid amount" means the fee for the service equivalent that would have been paid for a specific service if the service had not been capitated.

Am. “Principal Investigator” means the person in charge of a project that makes use of limited use research health care claims data sets. The principal investigator is the custodian of the data and is responsible for compliance with all restrictions, limitations and conditions of use associated with the data release.

An. “Public Use Data Set” means a publicly available data set containing only the public use data elements specified in this Rule as unrestricted data elements in Appendix J.

Ao. “Reporter” means a health insurer as defined herein and at 18 V.S.A. §9410(j)(1), and shall include Voluntary Reporters as defined herein.

Ap. “Subscriber” means the individual responsible for payment of premiums or whose employment is the basis for eligibility for membership in a health benefit plan.

Aq. “Third-party Administrator” means any person who, on behalf of a health insurer or purchaser of health benefits, receives or collects charges, contributions or premiums for, or adjusts or settles claims on or for residents of this State or Vermont health care providers and facilities.

Ar. “Vermont Healthcare Claims Uniform Reporting and Evaluation System” or “VHCURES” means the Department’s system for the collection, management and reporting of eligibility, claims and related data submitted pursuant to 18

V.S.A. § 9410.

As. “Voluntary Reporter” includes any entity other than a mandated reporter, including any health benefit plan offered or administered by or on behalf of the federal government where such plan, with the agreement of the federal government, voluntarily submits data to the BISHCA commissioner for inclusion in the database on such terms as may be appropriate.


Section 4: Reporting Requirements

Registration and Reporting Requirements

A. VHCURES Reporter Registration. On an annual basis prior to December 31, Health Insurers shall register with the Department on a form established by the Commissioner and identify whether health care claims are being paid for members who are Vermont residents and whether health care claims are being paid for non-residents receiving covered services from Vermont health care providers or facilities. Where applicable, the completed form shall identify the types of files to be submitted per Section 5. This form shall be submitted to BISHCA or its designee. See Appendix F.

B. Third Party Administrator Registration. Any person or entity that provides third party administration services, a third party administrator or “TPA” as defined in Section 3, shall register with the Department on a form established by the Commissioner, both before doing business in Vermont and on an annual basis prior to December 31 thereafter. 18 V.S.A. §9410. See Appendix G.

C. Pharmacy Benefit Manager Registration. Any person or entity that performs pharmacy benefit management (a pharmacy benefit manager or “PBM”) shall register with the Department on a form established by the Commissioner both before doing business in Vermont and on an annual basis prior to December 31. 18 V.S.A. §9421. The registration requirement includes persons or entities in a contractual or employment relationship with a health insurer or PBM performing pharmacy benefit management for a health plan with Vermont enrollees or beneficiaries. 18 V.S.A. §9471. See Appendix H.

D. Health Insurers shall regularly submit medical claims data, pharmacy claims data, member eligibility data, provider data, and other information relating to health care provided to Vermont residents and health care provided by Vermont health care providers and facilities to both Vermont residents and non-residents in specified electronic format to the Department for each health line of business (Comprehensive Major Medical, TPA/ASO, Medicare Supplemental, Medicare Part C, and Medicare Part D) per the data submission requirements contained in the appendices to this Rule.

E. Voluntary Reporters may, with the permission of the Commissioner, participate in VHCURES and submit medical claims files, pharmacy claims files, member eligibility files, provider data, and other information relating to health care provided to Vermont residents and health care provided by Vermont health care providers and facilities to both Vermont residents and non-residents in specified electronic format to the Department per the data submission requirements contained in the appendices to this Rule.


Section 5: Required Healthcare Data Files

Mandated Reporters shall submit to BISHCA or its designee health care claims data for all members who are Vermont residents and all non-residents who received covered services provided by Vermont health care providers or facilities in accordance with the requirements of this section. Each Mandated Reporter is also responsible for the submission of all health care claims processed by any sub-contractor on its behalf unless such subcontractor is already submitting the identical data as a Mandated Reporter in its own right. The health care claims data submitted shall include, where applicable, a member eligibility file containing records associated with each of the claims files reported: a medical claims file and a pharmacy claims file. The data submitted shall also include supporting definition files for payer specific provider specialty taxonomy codes and procedure and/or diagnosis codes.

A. General Requirements for Data Submission

(1) Adjustment Records. Adjustment records shall be reported with the appropriate positive or negative fields with the medical and pharmacy claims file submissions. Negative values shall contain the negative sign before the value. No sign shall appear before a positive value.

(2) Behavioral or Mental Health Claims. All claims related to behavioral or mental health shall be included in the medical claims file.

(3) Capitated Service Claims. Claims for capitated services shall be reported with all medical and pharmacy claims file submissions.

(4) Claims Records. Records for the medical and pharmacy claims file submissions shall be reported at the visit, service, or prescription level. The submission of the medical and pharmacy claims is based upon the paid dates and not upon the dates of service associated with the claims.

(5) Codes and Encryption Requirements

(a) Code Sources. Unless otherwise specified in this regulation, the code sources listed and described in Appendix A shall be utilized in association with the member eligibility file and medical and pharmacy claims file submissions.

(b) Member Identification Code. Reporters shall assign to each of their members a unique identification code that is the member’s social security number. If a Reporter does not collect the social security numbers for all members, the Reporter shall use the social security number of the subscriber and then assign a discrete two- digit suffix for each member under the subscriber’s contract.

If the subscriber’s social security number is not collected by the Reporter, a version of the subscriber’s certificate or contract number shall be used in its place. The discrete two-digit suffix shall also be used with the certificate or contract number. The certificate or contract number with the two-digit suffix shall be at least eleven but not more than sixty-four characters in length.

The social security number of the member/ subscriber and the subscriber and member names shall be encrypted prior to submission by the Reporter utilizing a standard encryption methodology provided by BISHCA or its designee. The unique member identification code assigned by each Reporter shall remain with each member/subscriber for the entire period of coverage for that individual.

(c) Specific/Unique Coding. With the exception of provider, provider specialty, and procedure/diagnosis codes, specific or unique coding systems shall not be permitted as part of the health care claims data set submission.

(6) Co-Insurance/Co-Payment. Co-insurance and co-payment are to be reported in two separate fields in the medical and pharmacy claims file submissions.

(7) Coordination of Benefits Claims. Claims where multiple parties have financial responsibility shall be included with all medical and pharmacy claims file submissions.

(8) Denied Claims. Denied claims shall be excluded from all medical and pharmacy claims file submissions. When a claim contains both fully processed/paid service lines and partially processed or denied service lines, only the fully processed/paid service lines shall be included as part of the health care claims data set submittal.

(9) Eligibility Records. Records for the member eligibility file submission shall be reported at the individual member level with one record submitted for each claim type. If a member is covered as both a subscriber and a dependent on two different policies during the same month, two records must be submitted. If a member has 2 contract numbers for 2 different coverage types, 2 member eligibility records shall be submitted.

(10) Exceptions.

(a) Medical Claims File Exclusions. All claims related to services provided under stand-alone health care policies shall be excluded if the services are not covered by comprehensive medical insurance policies and are provided on a stand-alone basis for:

1. Specific disease;

2. Accident:

3. Injury;

4. Hospital indemnity;

5. Disability:

6. Long-term care;

7. Student liability;

8. Vision coverage; or

9. Durable medical equipment.

(b) Claims for pharmacy services containing national drug codes are to be included in the pharmacy claims file, but excluded from the medical claims file.

(c) Member Eligibility File Exclusions. Members without medical or pharmacy coverage for the month reported shall be excluded.

(11) File Format. Each file submission shall be an ASCII file, variable field length, and asterisk delimited. When asterisks are used in any field values, the entire value shall be enclosed in double quotes.

(12) Insured Group or Policy Number Key Look-up Table. Reporters are required to submit a key look-up table when submitting member eligibility files. The key look-up table shall link Insured Group or Policy Number (ME006) to the name of the group associated with each Insured Group or Policy Number, but shall not identify any individual policyholders in connection with non-group policies.

(13) Header and Trailer Records. Each member eligibility file and each medical and pharmacy claims file submission shall contain a header record and a trailer record. The header record is the first record of each separate file submission and the trailer record is the last. The header and trailer record formats shall be as detailed in Appendices B-1 and B-2.

(14) Pharmacy Claims. Claims for pharmacy services shall be included in the following files:

(a) If the pharmacy claims are covered under the medical benefit then the claim shall be included in the medical claims file and not the pharmacy claims file; and

(b) If the claim is covered under the prescription benefit then the claim shall be included in the pharmacy claims file.

(15) Prepaid Amount. Any prepaid amounts are to be reported in a separate field in the medical and pharmacy claims file submissions.

(16) Supplemental Health Insurance. Claims related to supplemental health insurance are to be included if the policies are for health care services entirely excluded by the Medicare, Tricare, or other publicly funded health benefit programs.


B. Detailed File Specifications.

(1) Filled Fields. All required fields shall be filled where applicable. Non- required text, date, and integer fields shall be set to null when unavailable. Non-applicable decimal fields shall be filled with one zero and shall not include decimal points when unavailable.

(2) Position. All text fields are to be left justified. All integer and decimal fields are to be right justified.

(3) Signs. Positive values are assumed and need not be indicated as such.

Negative values must be indicated with a minus sign and must appear in the left-most position of all integer and decimal fields. Over-punched signed integers or decimals are not to be utilized.

(4) Individual Elements and Mapping. Individual data elements, data types, field lengths, field description/code assignments, and mapping locators (UB-04, HCFA 1500, ANSI X12N 270/271, 835, 837) for each file shall be as detailed in the following appendices:

(a)

(1)

Member Eligibility File Specifications – Appendix C-1

 

(2)

Member Eligibility File Mapping to National Standard Formats – Appendix C-2

(b)

(1)

Medical Claims File Specifications – Appendix D-1

 

(2)

Medical Claims File Mapping to National Standard Formats – Appendix D-2

(c)

(1)

Pharmacy Claims File Specifications – Appendix E-1

 

(2)

Pharmacy Claims File Mapping to National Standard Formats – Appendix E-2

Section 6: Submission Requirements

Data submission requirements shall be as detailed in the attached appendices.

A. Registration Form. It is the responsibility of each Health Insurer to resubmit or amend the registration form required by Section 4 (A) whenever modifications occur relative to the data files or contact information.

B. File Organization. The member eligibility file, medical claims file and pharmacy claims file shall be submitted to BISHCA or its designee as separate ASCII files.

Each record shall terminate with a carriage return (ASCII 13) or a carriage return line feed (ASCII 13, ASCII 10).

C. Filing Media. Files shall be submitted utilizing one of the following media: diskette (1.44 MB), CD-ROM (650 MB), DVD, secure SSL web upload interface, or electronic transmission through a File Transfer Protocol. E-mail attachments shall not be accepted. Space permitting, multiple data files may be submitted utilizing the same media if the external label identifies the multiple files.

D. Transmittal Sheet. All file submissions on physical media shall be accompanied by a hard copy transmittal sheet containing the following information: identification of the Reporter, file name, type of file, data period(s), date sent, record count(s) for the file(s), and a contact person with telephone number and E- mail address. The information on the transmittal sheet shall match the information on the header and trailer records. See Appendix I.

E. Testing of Files. At least sixty days prior to the initial submission of the files or whenever the data element content of the files as described in Section 5 is subsequently altered, each Reporter shall submit to BISHCA or its designee a data set for comparison to the standards listed in Section 7. The size, based upon a calendar period of one month, quarter, or year, of the data files submitted shall correspond to the filing period established for each Reporter under subsection I of this Section.

F. Rejection of Files. Failure to conform to subsections A, B, or C of this Section shall result in the rejection and return of the applicable data file(s). All rejected and returned files shall be resubmitted in the appropriate, corrected form to BISHCA or its designee within 10 days.

G. Replacement of Data Files. No Reporter may replace a complete data file submission more than one year after the end of the month in which the file was submitted unless it can establish exceptional circumstances for the replacement. Any replacements after this period must be approved by BISHCA. Individual adjustment records may be submitted with any monthly data file submission.

H. Run-Out Period. Reporters shall submit medical and pharmacy claims files for at least a six month period following the termination of coverage date for all members who are Vermont residents or non-residents receiving covered services provided by Vermont health care providers or facilities.

I. Data Submission Schedule. The reporting period for submission of each specified file listed in Section 5 shall be determined on a separate basis for Vermont members and non-resident members by the highest total number of Vermont resident members or non-resident members receiving covered services provided by Vermont providers or facilities for which claims are being paid for any one month of the calendar year. Data files are to be submitted in accordance with the following schedule:


Total # of Members

Reporting Period

Reporting Schedule

≥ 2,000

Monthly

Prior to the end of the month

following the month in which claims were paid

500 – 1,999

Quarterly

Prior to April 30, July 31,

October 31, January 31 for each preceding calendar quarter in which claims were paid

200 - 499

Annually

Prior to April 30 of the

following year for the preceding twelve months in which claims were paid

< 200

N/A

 

If the data files submitted by an individual Reporter support or are related to the files submitted by another Reporter, BISHCA shall establish a filing period for the parties involved.

Section 7: Compliance with Data Standards

A. Standards. BISHCA or its designee shall evaluate each member eligibility file, medical claims file and pharmacy claims file in accordance with the following standards:

(1) The applicable code for each data element shall be as identified in Appendices C-1, D-1, and E-1 and shall be included within eligible values for the element;

(2) Coding values indicating “data not available”, “data unknown”, or the equivalent shall not be used for individual data elements unless specified as an eligible value for the element;

(3) Member sex, diagnosis and procedure codes, and date of birth and all other date fields shall be consistent within an individual record;

(4) Member identifiers shall be consistent across files; and

(5) Files submitted shall not contain direct personal identifiers.

B. Notification. Upon completion of this evaluation, BISHCA or its designee will promptly notify each Reporter whose data submissions do not satisfy the standards for any reporting period. This notification will identify the specific file and the data elements that are determined to be unsatisfactory.

C. Response. Each Reporter notified under subsection 7.B shall resubmit within 60 days of the date of notification with the required changes.

D. Compliance. Failure to file, report, or correct health care claims data sets in accordance with the provisions of this regulation may be considered a violation of 18 V.S.A. § 9410 (g).

Section 8: Procedures for the Approval and Release of Claims Data

The requirements, procedures and conditions under which persons other than the Department may have access to health care claims data sets and related information received or generated by the Department or its designee pursuant to this regulation shall depend upon the requestor and the characteristics of the particular information requested, all as set forth below.

A. Classification of Data Elements

(1) Unrestricted Data Elements: Data elements designated in Appendix J as “Unrestricted” shall be available for general use and public release as part of a Public Use File.

(2) Restricted Data Elements: Data elements designated in Appendix J as “Restricted” shall not be available for use and release outside the Department except as part of a Limited Use Research Health Care Claims Data Set approved by the commissioner pursuant to the requirements of this regulation.

(3) Unavailable Data Elements: Data elements which are not designated in Appendix J as either Unrestricted or Restricted, or are designated as “Unavailable”, shall not be available for release or use outside the Department in any data set or disclosed in publicly released reports in any circumstance.

B. Public Use Data Sets: Release and Availability

(1) Unrestricted Data Elements collected or generated by the Department or its designee shall be made available in public use files and provided to any person upon written request, except where otherwise prohibited by law.

(2) The Department shall maintain a public record of all requests for and releases of public use data sets.

C. Limited Use Health Care Claims Research Data Sets- Release and Availability

(1) Limited Use Health Care Claims Research Data Sets shall be those sets which contain restricted data elements, shall not be available to the general public and shall be released to a requestor only for the purpose of research upon a determination by the Commissioner that the following conditions have been met:

(a) Application: Any person requesting access to or use of Limited Use Health Care Claims Research Data Sets shall submit an application, in written and electronic form, to the Commissioner disclosing the information listed below. Studies utilizing data sets for longer than 2 years may be required to reapply.

(1) Identity of principal investigator:

(a) Name, address, and phone number;

(b) Organizational affiliation;

(c) Professional qualification; and

(d) Phone number of principal investigator's contact person, if any.

(2) Identity of person requesting access, including any entities for whom that person is acting in requesting the data.

(a) Name, address, and phone number;

(b) Organizational affiliation;

(c) Professional qualification; and

(d) Name and phone number of contact person.

(3) Identity of and qualifications of any other persons who may have access to the data.

(4) A detailed research protocol, to include:

(a) A summary of background, purposes, and origin of the research;

(b) A statement of the health-related problem or issue to be addressed by the research;

(c) The research design and methodology, including either the topics of exploratory research or the specific research hypotheses to be tested;

(d) The procedures that will be followed to maintain the confidentiality of any data or copies of records provided to the principal investigator or other persons; and

(e) The intended research completion date;

(5) Particular data set requested, including:

(a) The time period of the data requested;

(b) The specific data elements or fields of information required;

(c) A justification of the need for each restricted element or field, as identified in the data release schedule;

(d) The minimum needed specificity of the requested data elements, including the manner in which the data may be recoded by the department to be less specific;

(e) The selection criteria for the minimum needed data records required; and

(f) Any particular format or layout of data requested by the principal investigator.

(6) Any changes to information submitted as part of an application pursuant to (a)(1)-(4) shall require notice to the Department by the applicant and shall be subject to the approval of the Commissioner.

(b) The person or entity requesting access and the principal investigator or investigators shall be subject to the following requirements and limitations and shall, in addition, sign and submit a data use agreement acknowledging and accepting these same provisions as a necessary condition to any data access:

(1) Use of data for any purpose other than as specified in the application and approved by the Commissioner shall be prohibited;

(2) Appropriate safeguards to protect the confidentiality of the data and prevent unauthorized use of the data shall be established;

(3) The use or disclosure, sale, or dissemination of the data set or statistical tabulations derived from the data set to any person or organization for any purpose other than as described in the application and as permitted by the data use agreement shall be prohibited without the express written consent of the Commissioner.

(4) The use or disclosure, sale, or dissemination of any information contrary to law shall be prohibited;

(5) No person shall disclose the identity of patients, employer groups or purchaser groups from information contained in the limited use data set;

(6) No person shall disclose any of the information that has been encrypted or removed from the data;

(7) The content of cells that contain counts of persons in statistical tables in which the cell size is more than 0 and less than 5 shall not be disclosed, published or made public in any manner except as “<5”;

(8) The publication, dissemination or disclosure of any information that could be used to identify providers of abortion services shall be prohibited;

(9) Any use or disclosure of the information that is contrary to the Data Use Agreement or this Regulation shall be reported to the Department within five (5) days of when the principal investigator becomes aware of such disclosure.

(10) The Department and the “Vermont Healthcare Claims Uniform Reporting and Evaluation System” shall be acknowledged as the source and owner of the data in any and all public reports, publications, or presentations generated from the data;

(11) Written materials shall prominently state that the analyses, conclusions and recommendations drawn from such data are solely those of the requestor or principal investigator and are not necessarily those of the Department;

(12) The Department shall be provided with a copy of any proposed report or publication containing information derived from the data at least 15 days prior to any publication or release to allow the department to review the proposed report or publication and confirm that the conditions of the agreement have been applied. When multiple reports of a similar nature will be created from the data, the Department may, on request, waive the requirement that any subsequent reports or publications be provided to the Department prior to release by the requesting party

(13) Data elements shall not be retained for any period of time beyond that necessary to fulfill the requirements of the data request.

(14) Within 30 days after the scheduled completion date of the project, the requestor shall delete, destroy or otherwise render the data unreadable, so certifying by submitting a written notice to the Department or by reapplying for approval if the end date of the project needs to be extended;

(15) Any draft reports or publications supplied to the department shall be considered confidential and exempt from public review under 1 V.S.A. §315 et seq. and shall not be released by the Department; and

(16) Failure to adhere to the data use agreement or the limitations and restrictions detailed above will be cause for immediate recall by the Department of the data, revocation of permission to use the data, and grounds for civil or administrative enforcement action by the Department under applicable Vermont state law.

(c) The Department shall establish a claims data release advisory committee with a chair person and members appointed annually by the Commissioner, to provide non-binding advice and opinion to the Commissioner, as and when requested, on the merits of applications for access to limited use data sets. If the Commissioner has requested a review of the application, the claims data release advisory committee shall provide the Commissioner with any comment on the merits of the application and the research protocol described therein within thirty (30) days. The committee shall be comprised of seven (7) members and include:

(1) At least one member representing health insurers;

(2) At least one member representing health care facilities;

(3) At least one member representing health care providers;

(4) At least one member representing purchasers of health insurance or health benefits; and

(5) At least one member representing healthcare researchers.

(2) The Commissioner may approve the release of limited use data sets only when the Commissioner is satisfied as to the following:

(a) The application submitted is complete and the requesting individuals or entities and principal investigator have signed a data use agreement as specified;

(b) Procedures to ensure the confidentiality of any patient and any confidential data are documented;

(c) The qualifications of the investigator and research staff, as evidenced by:

(1) Training and previous research, including prior publications; and

(2) An affiliation with a university, private research organization, medical center, state agency, or other qualified institutional entity.

(d) No other state or federal law or regulation prohibits release of the requested information.

(3) If the Commissioner declines to release the requested limited use data sets within 60 days of receipt of a complete application, the Department shall give written notice of the basis for denial of the application and the requestor shall have leave to resubmit or supplement the application to address the Commissioner’s concerns. Any adverse decision regarding an application may be appealed within 30 days by filing a request for hearing with the Commissioner pursuant to Department Rule 82-1.

Section 9: Prices for Data Sets, Fees for Programming and Report Generation, Duplication Rates

This Section lists the prices for data sets from the Vermont Healthcare Claims Uniform Reporting and Evaluation System, including the fees for programming and report generation, duplicating charges and other costs associated with the production and transmission of data sets approved for release by the Department.

A. An annual public use file consisting of unrestricted fields and data elements shall be made available to any person upon request at the cost required for the Department to process, package and ship the data set, including any electronic medium used to store the data.

B. Limited Use Research Health Care Claims Data Sets approved by the Department shall be made available to the requesting party at the cost charged by the Department’s designated vendor to program and process the requested data extract, including any consulting services and costs to package and ship the data set on particular electronic medium.

C. Payments are due in full from the requesting party within thirty days of receipt of BISHCA data sets, files, reports, or other released material.

Section 10: Enforcement

Violations of data submission requirements, confidentiality requirements, data use limitations or any other provisions of this rule shall be subject to sanction by the Commissioner as set out in 18 V.S.A. §9410 in addition to any other powers granted to the Commissioner to investigate, subpoena, fine or seek other legal or equitable remedies.

Section 11: Severability

If any provision of this regulation or the application thereof to any person or circumstance is for any reason held to be invalid, the remainder of the regulation and the application of such provisions to other persons or circumstances shall be not affected thereby.

Appendices available in printer-friendly version.

Health Care Price and Quality Transparency Rule

Regulation
Wednesday, October 1, 2008
Reg-H-2007-05

File attachments: 

http://www.dfr.vermont.gov/sites/default/files/REG-H-07-05.pdf

Rule No. H-2007-05

Health Care Price and Quality Transparency Rule

Section 1. Purpose.

The purpose of this Rule is to provide consumers with access to information concerning health care prices, health care quality, and other information necessary to empower consumers, including uninsured consumers, to make economically sound and medically appropriate decisions.

Section 2. Authority.

This Rule is issued pursuant to the authority vested in the Commissioner by law, including but not limited to 18 V.S.A. § 9410(a)(2), 8 V.S.A. § 15(a), and 18 V.S.A. § 9404(d).

Section 3. Definitions.

As used in this Rule:

(1) “Brand Name Drug” means a drug marketed under a proprietary, trademark-protected name.

(2) "Charge" means the amount sought as payment by a Health Care Facility, Health Care Provider, or seller of prescription drugs, durable medical equipment, or medical supplies for a health care service or product before the application of any discount, write-off, contract or plan adjustment or allowance, or other reduction to such amount.

(3) "Commissioner" means the Commissioner of the Department.

(4) "Consumer Information Plan" means the Consumer Information Plan filed by a Health Insurer for the benefit of the Health Insurer’s Members, and approved by the Commissioner under Section 4 of this Rule.

(5) "Department" means the Vermont Department of Banking, Insurance, Securities and Health Care Administration.

(6) “Diagnostic Related Group” or “DRG” means any of the diagnostic categories which Medicare accepts that can be used to classify a patient’s inpatient service for reimbursement purposes.

(7) “Generic Drug” means a drug which has been approved by the Food and Drug Administration as a generic drug to be equivalent to a Brand Name Drug in dosage, safety, strength, how it is taken, quality, performance, and intended use.

(8) "Health Care Facility" means all institutions, whether public or private, proprietary or nonprofit, which offer diagnosis, treatment, inpatient or ambulatory care to two or more unrelated persons, and the buildings in which those services are offered. The term shall not apply to any facility operated by religious groups relying solely on spiritual means through prayer or healing, but includes all institutions included in subdivision 9432(7) of Title 18, except health maintenance organizations.

(9) "Health Care Provider" means a person, partnership or corporation, other than a facility or institution, licensed or certified or authorized by law to provide professional health care service in this state to an individual during that individual's medical care, treatment or confinement, and, except in connection with the requirements of Section 6 of this Rule, practicing under a participating provider agreement with a Health Insurer.

(10) " Health Care Provider Practice" means an organization of Health Care Providers whose financial information is reported annually by a Hospital pursuant to 18 V.S.A. Chapter 221, subchapter 7

(11) "Health Insurer" means:

(A) any health insurance company, nonprofit hospital and medical services corporation, or health maintenance organization with at least five percent of the lives covered in the insured market in Vermont, as reported by the Department for the prior calendar year. The requirements of this Rule apply to:

(i) a Health Insurer in connection with its insured plans;

(ii) a Health Insurer, or the controlled affiliate of a Health Insurer, acting as a third-party administrator for a health benefit plan, and

(iii) the agents or affiliates of the Health Insurer who contract to administer the benefits covered or administered by the Health Insurer, such as pharmacy benefit managers and mental health services review agents licensed under 8 V.S.A. § 4089a; and

(B) the employee health benefit plan offered by the State of Vermont, or any agency or instrumentality of the state; and

(C) Medicaid, VHAP, SCHIP and any other health benefit plan offered or administered by the Vermont Office of Health Access, to the extent permitted by federal law or authority.

(12) "Hospital" means an acute care hospital licensed under chapter 43 of Title 18, Vermont Statutes Annotated, and except for purposes of Section 6 of this Rule, any out of state hospital with more than 1,000 annual inpatient discharges of Vermont residents. The Department shall publish annually a list of hospitals that satisfy the criteria of this subdivision.

(13) "Member" means an individual or dependent covered by the health benefit plan of a Health Insurer.

(14) “Physician” means a physician practicing under a participating provider agreement with a Health Insurer, except in connection with the requirements of Section 6 of this Rule.

(15) "Price" means the amount due to a Health Care Facility, Health Care Provider, or seller of durable medical equipment, or medical supplies for a health care service or product after the application of any discount, write-off, contract or plan adjustment or allowance, or other reduction to the Charge amount, and before the application of any individual Member cost-sharing, including deductibles, co-payments, co-insurance, and out-of-pocket maximums. The “Price” of prescription drugs means the amount due to the pharmacy or other entity for the delivery of prescription drugs to the Health Insurer’s Members, or the pharmacy’s or other entity’s usual and customary charge, whichever is lower; provided that the Health Insurer may, but is not required to disclose the lower usual and customary charge.

(16) “Primary Care Physician” means a Physician who provides primary care services, and who is designated as a primary care physician by the Health Insurer.

(17) "Rule" means the administrative rule adopted herein.

(18) “Therapeutic Equivalent Drug” means drug products classified as therapeutically equivalent by the Food and Drug Administration that can be substituted with the full expectation that the substituted product will produce the same clinical effect and safety profile as the prescribed product.

(19) “Uninsured Consumer Information Plan” means the Uninsured Consumer Information Plan filed by a Hospital or by a Health Care Provider Practice and approved by the Commissioner under Section 6 of this Rule.

Section 4. Health Insurer Consumer Price and Quality Information Plans

(a) General. Each Health Insurer shall establish, maintain and administer a Consumer Information Plan approved by the Commissioner.

(b) Filing and Approval. On or before January 1, 2009, on or before January 1, 2011, and if required thereafter under subdivision (c)(4) of this Section, each Health Insurer shall file in writing with the Commissioner a Consumer Information Plan that complies with the requirements of this Rule. The Consumer Information Plan shall be deemed approved unless the Commissioner, within 30 calendar days of filing, approves, disapproves, or approves the Consumer Information Plan subject to such conditions as the Commissioner may prescribe as necessary to ensure that the Consumer Information Plan is consistent with the provisions of this Rule, and with the provisions of 18 V.S.A. § 9410(a)(2). The Commissioner may extend the time period to review and act upon the Plan for one additional 30 day period if necessary. The Commissioner shall not disapprove a Consumer Information Plan unless the Commissioner finds that it is in noncompliance with one or more of the requirements of this Rule. The Consumer Information Plan shall take effect and be implemented six months after approval, unless the Health Insurer demonstrates and the Commissioner finds that a later effective date is needed to avoid undue financial or administrative burden. The Consumer Information Plan of a Health Insurer as defined by Section 3(11)(C) shall be deemed approved upon filing; however the Department may offer guidance to Plans filed by the Vermont Office of Health Access as is necessary and appropriate to carry out the purposes of this Rule.

(c) Phased-In Consumer Information Plan Price Information.

(1) First Phase. On and after October 1, 2008, each Health Insurer shall provide Members with a link on the Health Insurer’s website to, or information on how to access, at least the information identified or described in the Department's Act 53 Hospital Community Report website for hospital quality and Charge information, and free care and discount policies.

(2) Second Phase. A Consumer Information Plan filed with the Commissioner on or before January 1, 2009 shall describe how the Health Insurer will provide consumers with Price information concerning at least the information identified or described in subdivisions (A) through (E), below.

(A) The in-patient, out-patient diagnostic and other procedures and services provided by each Hospital, as identified in the Act 53 Hospital Community Report pursuant to 18 V.S.A. § 9405b(c).

(B) The following procedures or services provided by individual Physicians or Physician practices:

(i) the list of procedures and services identified in Appendix A; or

(ii) an alternative list filed with the Commissioner, if the Commissioner determines that the alternative list will accomplish the purposes of this Rule. Such alternative list may include for Physician services and procedures a list approved by the Commissioner of “examination and management” codes, plus the code for routine obstetrical care;

(C) The 100 prescription drugs most frequently prescribed to the Health Insurer’s Members, not including prescription drugs administered by a Health Care Provider in the office environment. Price information shall permit Price comparison of the list of most frequently prescribed drugs with those Brand Name Drugs, Therapeutic Equivalent Drugs, and Generic Drugs, which can be prescribed for a specific illness or condition, or for a category of illnesses or conditions. In counting the 100 most frequently prescribed drugs, a Brand Name Drug and its Generic Drug equivalent shall be counted as one drug, and different dosages of the same drug shall be counted as one drug. If a Health Insurer’s Price for prescription drugs does not vary from pharmacy to pharmacy, the Health Insurer may disclose to Members that one Price applies for all pharmacies, and the Health Insurer need not list Price for individual pharmacies;

(D) The 20 items of durable medical equipment most frequently purchased or leased by the Health Insurer’s Members; and

(E) The 10 items of medical supplies such as diabetic supplies, excluding any items obtained through the Health Insurer’s pharmacy benefit manager’s website most frequently purchased by the Health Insurer’s Members.

(3) Third Phase. A Consumer Information Plan filed with the Commissioner on or before January 1, 2011 shall describe how the Health Insurer will provide consumers with Price information concerning at least the information identified or described in subdivisions (A) through (E) below.

(A) The in-patient, out-patient, diagnostic and other procedures and services provided by each Hospital, as identified in the Act 53 Hospital Community Report pursuant to 18 V.S.A. § 9405b(c).

(i) Where applicable to, and feasible for a specific Hospital in connection with inpatient procedures and services, Price information shall be aggregated for Hospital and Physician Price information for procedures and services typically associated with Diagnostic Related Group codes in a manner approved by the Commissioner upon consideration of the recommendations of the Act 53 Financial Workgroup.

(ii) Where applicable to, and feasible for a specific Hospital in connection with outpatient procedures and services, Price information shall be aggregated for Hospital and Physician Price information in a manner approved by the Commissioner upon consideration of the recommendations of the Act 53 Financial Workgroup.

(iii) The Health Insurer shall disclose to Members the methodology used to derive the Price for the Diagnostic Related Group.

(B) The following procedures or services provided by individual Physicians or Physician practices:

(i) The list of procedures and services identified in Appendix A; or an alternative list filed with the Commissioner, if the Commissioner determines that the alternative list will accomplish the purposes of this Rule.

(ii) Such alternative list may include for Physician services and procedures a list approved by the Commissioner of “examination and management” codes, plus the code for routine obstetrical care.

(iii) Such alternative list may also include a list approved by the Commissioner after consideration of an advisory committee of affected parties convened by the Department to assist in the development of filing instructions for Consumer Information Plans filed on or before January 1, 2011. The Commissioner may require Health Insurers to use a uniform or substantially uniform list of Physician procedures and services in the Health Insurer’s Consumer Information Plan, if the Commissioner determines that a reasonable state-wide or national consensus has been reached with respect to the disclosure of Price information for Physician procedures and services;

(C) The 200 prescription drugs most frequently prescribed to the Health Insurer’s Members, not including prescription drugs administered by a health care provider in the office environment. Price information shall permit comparison of the list of most frequently prescribed drugs with those Brand Name Drugs, Therapeutic Equivalent Drugs, and Generic Drugs, which can be prescribed for a specific illness or condition, or for a category of illnesses or conditions. In counting the 200 most frequently prescribed drugs, a Brand Name Drug and its Generic Drug equivalent shall be counted as one drug, and different dosages of the same drug shall be counted as one drug. If a Health Insurer’s Price for prescription drugs does not vary from pharmacy to pharmacy, the Health Insurer may disclose to Members that one Price applies for all pharmacies, and the Health Insurer need not list Price for individual pharmacies;

(D) The 40 items of durable medical equipment most frequently purchased or leased by the Health Insurer’s Members; and

(E) The 20 items of medical supplies, such as diabetic supplies, excluding any items obtained through the Health Insurer’s pharmacy benefit manager’s website most frequently purchased by the Health Insurer’s Members.

(4) Fourth Phase. A Consumer Information Plan filed with the Commissioner on or before January 1, 2013, and every two years thereafter, shall describe how the Health Insurer will provide consumers with the following Price information:

(A) At least the information identified or described in subdivisions (3)(A) through (E), above;

(B) After consultation with affected parties, and with the approval of the Commissioner, Price information shall include an increase of the number of items disclosed of up to 400 prescription drugs, and up to 80 items of durable medical equipment, and up to 40 medical supply items; and

(C) after consultation with affected parties, and with the approval of the Commissioner by means of an order issued pursuant to 8 V.S.A. § 15, Price information concerning the following categories of care and treatment, if such care and treatment is covered by the Health Insurer: chiropractic, psychological and other mental health care and treatment, naturopathic, dental, physical therapy, osteopathic, nursing home, home health, and other care and treatment provided by Health Care Providers. A person aggrieved by an order issued under this subdivision may file an administrative appeal pursuant to BISHCA Regulation 82-1 (Revised), and the order appealed from shall be stayed as to the appellant until the final decision of the Commissioner is issued.

(D) Upon request of a Health Insurer, the Commissioner may waive or modify one or more requirements of this subdivision (4) if the Health Insurer demonstrates and the Commissioner finds that application of the requirement is unreasonable, unnecessary, or contrary to the purposes of this Rule.

(d) Phased-In Consumer Information Plan Quality Information.

(1) Hospital Quality Information.

(A) On and after October 1, 2008, each Health Insurer shall provide Members with a link on the Health Insurer’s website to, or information on how to access the Department of Health and Human Services, or Centers for Medicare and Medicaid Services "Compare" websites for hospitals, nursing homes, home health agencies, and other Health Care Providers and Health Care Facilities for which similar information resources are developed in the future.

(B) In a Consumer Information Plan filed with the Commissioner on or before January 1, 2009, a Health Insurer shall use, or provide a link to the hospital quality information maintained pursuant to Act 53 to satisfy the Hospital quality information requirements of this Rule. In addition, the Health Insurer may use other Hospital quality measures approved by the Commissioner as valid and reliable, after consultation with affected parties.

(2) Physician Quality Information.

(A) In the Consumer Information Plan filed with the Commissioner on or before January 1, 2009, the Health Insurer shall describe how the Health Insurer will provide quality information at least with respect to Primary Care Physicians. In connection with such Plan, the Health Insurer shall use either:

(i) NCQA physician recognition certification to satisfy the Health Care Provider quality information requirements of this Rule. The Health Insurer shall not be obligated to secure, facilitate or promote NCQA physician recognition certification for Physicians, but shall report on whether the Physician has been certified by NCQA. The Health Insurer shall not be required to report that a Physician has not been certified by NCQA; or

(ii) quality measures approved by the Commissioner, after consultation with affected parties, as valid and reliable, or designated as “nationally recognized” by the Commissioner, after consultation with affected parties. The Commissioner may prescribe terms and conditions in connection with any such approval or designation relating to the reliable and comprehensive use of such measures. The Commissioner may require Health Insurers to use uniform or substantially uniform quality measures if the Commissioner determines that a reasonable, national consensus has been reached with respect to uniform quality measures. The Commissioner shall designate as “nationally recognized” those quality information and reporting measures endorsed by the Centers for Medicare and Medicaid Services, the National Quality Forum, or the Ambulatory Quality Alliance. The Commissioner, after consultation with affected parties, may designate other nationally recognized quality information and reporting measures.

(B) In the Consumer Information Plan filed with the Commissioner on or before January 1, 2011, the Health Insurer shall describe how the Health Insurer will provide quality information with respect to Primary Care Physicians and with respect to other Physicians. In connection with such Plan, the Health Insurer shall use both:

(i) NCQA physician recognition certification to satisfy the Health Care Provider quality information requirements of this Rule with respect to Primary Care Physicians and with respect to other Physicians. The Health Insurer shall not be obligated to secure, facilitate or promote NCQA physician recognition certification for Physicians, but shall report on whether the Physician has, or has not been certified by NCQA; and

(ii) quality measures approved by the Commissioner, after consultation with affected parties, as valid and reliable, or designated as “nationally recognized” by the Commissioner, after consultation with affected parties. The Commissioner may prescribe terms and conditions in connection with any such approval or designation relating to the reliable and comprehensive use of such measures. The Commissioner may require Health Insurers to use uniform or substantially uniform quality measures if the Commissioner determines that a reasonable, national consensus has been reached with respect to uniform quality measures. The Commissioner shall designate as “nationally recognized” quality information and reporting measures those measures endorsed by the Centers for Medicare and Medicaid Services, the National Quality Forum, or the Ambulatory Quality Alliance. The Commissioner, after consultation with affected parties, may designate other nationally recognized quality information and reporting measures.

(3) The Health Insurer may elect to not provide quality information for particular procedures and services performed by an individual Physician, or by a Hospital if the number of procedures or services performed by such individual Physician or Hospital is too small to be statistically significant; and in such circumstances, the Commissioner may approve a Health Insurer’s proposed use of alternative means of obtaining statistically significant quality measures.

(4) A Consumer Information Plan filed with the Commissioner on or before January 1, 2013, and every two years thereafter, shall describe how the Health Insurer will provide consumers with the following quality information:

(A) at least the information identified or described in subdivisions (d)(1) and (2), above;

(B) after consultation with affected parties, and with the approval of the Commissioner by means of an order issued pursuant to 8 V.S.A. § 15, quality information concerning the following categories of care and treatment, if disclosure of Price information with respect to such categories of care and treatment is required under Section 4(c)(4)(C) of this Rule, and if such care and treatment is covered by the Health Insurer: chiropractic, psychological and other mental health care and treatment, naturopathic, dental, physical therapy, osteopathic, nursing home, home health, and other care and treatment provided by Health Care Providers. A person aggrieved by an order issued under this subdivision may file an administrative appeal pursuant to BISHCA Regulation 82-1 (Revised), and the order appealed from shall be stayed as to the appellant until the final decision of the Commissioner is issued; and

(C) the reporting of Price and quality information together in a manner that identifies or describes the relative value of procedures, services, prescription drugs, and major medical equipment and medical supplies.

(D) Upon request of a Health Insurer, the Commissioner may waive or modify one or more requirements of this subdivision (4) if the Health Insurer demonstrates and the Commissioner finds that application of the requirement is unreasonable, unnecessary, or contrary to the purposes of this Rule.

(e) General Content Requirements. A Consumer Information Plan shall state the manner in which the Health Insurer will comply with the following requirements during the period of time for which the Consumer Information Plan is applicable:

(1) The Health Insurer shall permit Members to view, by means of the Health Insurer’s website, the Price for a particular Hospital, Physician, pharmacy, or other entity of the procedures, services, prescription drugs, and major medical equipment and supplies identified in the Health Insurer’s Consumer Information Plan, or the median Price if there is a range of Prices. The Health Insurer shall permit Members to compare Prices and median Prices among specific Hospitals, Physicians, pharmacies and other entities.

(2) Price information shall be updated at least annually, and when Hospital, Physician, pharmaceutical, or other seller contracts are issued or reissued.

(3) If the Price for a particular procedure, service, prescription drug, item of medical equipment, or medical supply varies depending upon the different reimbursement rates of different Health Insurer products, the Health Insurer shall disclose the different Prices associated with the different products of the Health Insurer.

(4) During the First Phase of reporting, the Health Insurer has the option to use a link on the Health Insurer’s website to the website of the applicable government agency to access the information required by subdivision (c)(1) of this Section, or to provide access to such information on the Health Insurer’s own website.

(5) The Health Insurer may use a link on the Health Insurer’s website to the website of the Health Insurer’s pharmacy benefit manager for reporting of prescription drug information required by subdivisions (c)(2)(C), (c)(3)(C), and (c)(4) of this Section, or medical supplies purchased through the pharmacy benefit manager.

(6) The Health Insurer shall provide Members with guidance on how to estimate their out-of-pocket costs (including co-payments, coinsurance, and deductibles) for the procedures, services, prescription drugs, and major medical equipment and supplies identified in the Health Insurer’s Consumer Information Plan. Upon request the Health Insurer shall provide Members assistance with estimating out-of-pocket costs. A Health Insurer shall not be required to provide on-line calculators to estimate out-of-pocket costs, provided that any alternative method offers adequate guidance to Members for estimating out-of-pocket costs.

(7) The Health Insurer shall permit Members, by means of the Health Insurer’s website, to view and compare quality of care among specific Hospitals and Health Care Providers, in accordance with subsection (d) of this Section, for the procedures and services identified in the Health Insurer’s Consumer Information Plan.

(8) The Health Insurer shall establish for Members alternative mechanisms other than a website for obtaining the Price and quality information required by this Rule, such as through a toll-free telephone number available during normal business hours, or by providing printed price and quality information.

(9) The Health Insurer shall disclose to Members the source or sources of Price and quality information, information relating to reliability and reporting period for the Price and quality information provided in accordance with the Consumer Information Plan. The Health Insurer may communicate to Members suitable provisions disclaiming responsibility for the reliability and accuracy of the Price and quality information provided under the Consumer Information Plan.

(10) A Health Insurer may request that the Commissioner permit the substitution of one or more of the procedures, prescription drugs, or durable medical equipment and supplies for which Price information would be otherwise provided if the Health Insurer demonstrates and the Commissioner finds that the availability of price information would have anticompetitive consequences detrimental to consumers.

(11) Upon request by a Health Insurer, the Commissioner may waive one or more requirements of this Rule if the Health Insurer demonstrates and the Commissioner finds that application of the requirement is unreasonable, unnecessary, or contrary to the purposes of this Rule.

(12) The Health Insurer shall establish a procedure for Health Care Providers to review the Price and quality information related to the Health Care Provider, and to comment on its accuracy. The Health Insurer shall promptly correct inaccuracies where warranted. The Health Insurer shall maintain records of such comments, the Health Insurer’s response to such comments, and corrections for five years, in accordance with Department Regulation 99-1 (Record Retention).

Section 5. Security Measures

A Health Insurer may establish and maintain security procedures for limiting access to the Health Insurer’s Price and other information to Members only, through the on-line submission of a user name and password, or through some other Member verification and security procedure described in the Consumer Information Plan and approved by the Commissioner.


Section 6. Consumer Charge and Quality Information for Uninsured Consumers

(a) Each Hospital and Health Care Provider Practice shall establish, maintain, and administer an Uninsured Consumer Information Plan that is approved by the Commissioner, and that complies with the requirements of this Rule. The Uninsured Consumer Information Plan shall be deemed approved unless the Commissioner, within 30 calendar days of filing, approves, disapproves, or approves the Uninsured Consumer Information Plan subject to such conditions as the Commissioner may prescribe as necessary to carry out the purposes of 18 V.S.A. § 9410(a)(2). The Commissioner may extend the time period to review and act upon the Plan for one additional 30 day period if necessary. The Uninsured Consumer Information Plan shall take effect and be implemented six months after approval, unless the Hospital or Health Care Provider Practice demonstrates and the Commissioner finds that a later effective date is needed to avoid undue financial or administrative burden. The Uninsured Consumer Information Plan shall be filed with the Commissioner on or before January 1, 2009. The Hospital quality and charge information shall be updated annually, and when relevant charge and other changes are made.

(b) A Hospital Uninsured Consumer Information Plan shall provide, or describe a mechanism for consumers to access the following information, and to seek additional information and assistance in understanding Hospital quality and Charge information:

(1) Hospital quality information. A Hospital shall use the hospital quality information maintained pursuant to Act 53 to satisfy the hospital quality information requirements of this Rule. In addition, a Hospital may use Hospital quality information approved by the Commissioner under Section 4(d)(1)(B);

(2) Hospital Charge information, accompanied by:

(i) free care and discount policies;

(ii) eligibility criteria, the application process, and toll-free numbers for public health insurance programs such as Medicaid, VHAP, and Catamount Health Premium Assistance; and

(iii) information on how to access the Prescription Drug Price Finder of the Vermont Attorney General’s Office; and

(3) A mechanism for a consumer to learn the estimated Charge for a specific in-patient, out-patient or diagnostic procedure or service offered by the Hospital.

(c) A Health Care Provider Practice Uninsured Consumer Information Plan shall provide or describe a mechanism for consumers to access the following information:

(1) Health Care Provider quality information. A Health Care Provider Practice shall use NCQA physician recognition certification for reporting on Health Care Provider quality. The Health Care Provider shall not be obligated by this Rule to secure NCQA physician recognition certification. In addition, a Health Care Provider Practice Uninsured Consumer Information Plan may use Health Care Provider quality information approved by the Commissioner under Section 4(d)(2)(B). The Commissioner may require the use of additional quality information and reporting standards and protocols approved under Section 4(d)(2)(B)(ii) as a condition of approval of an Uninsured Consumer Information Plan.

(2) Health Care Provider Practice Charge information, accompanied by free care and discount policies; and

(3) A mechanism for any uninsured patient of a Health Care Provider Practice to learn the estimated Charge for a specific health care procedure or service offered by the Health Care Provider Practice.

(d) Upon the request of any uninsured patient of a Health Care Provider, a Health Care Provider shall inform the patient of the estimated Charge for a specific health care procedure or service offered by the Health Care Provider, and shall inform the consumer of the provider’s free care and discount policies, if any.

Section 7. Effective date.

This Rule shall take effect on October 1, 2008.

Catamount Health Insurance

Regulation
Friday, September 8, 2006
Reg-H-2006-01

File attachments: 

http://www.dfr.vermont.gov/sites/default/files/REG-H-06-01.pdf

RULE H-2006-01

CATAMOUNT HEALTH INSURANCE

Eff. Date: Sept. 8, 2006

Section 1. Purpose

The purpose of this Rule is to set forth the requirements for Catamount Health insurance, as provided in 8 V.S.A. § 4080f and An Act Relating to Health Care Affordability for Vermonters, 2005 Vt. Acts & Resolves No. 191 (Adj. Sess. 2006). Catamount Health insurance shall be sold and administered in accordance with the Act and the policies and purposes of Title 8.

Section 2. Authority

This Rule is issued pursuant to the authority vested in the Commissioner of the Department of Banking, Insurance, Securities and Health Care Administration by the Act, including, but not limited to, 8 V.S.A. § 4080f, and by other applicable portions of Title 8, including, but not limited to, 8 V.S.A. § 4062.

Section 3. Definitions

As used in this Rule:

(a) “Act” means An Act Relating to Health Care Affordability for Vermonters, 2005 Vt. Acts & Resolves No. 191 (Adj. Sess. 2006).

(b) “Catamount Health insurance” means those health insurance products and plans approved by the Commissioner and established under 8 V.S.A. § 4080f, Act 191, Adj. Session (2006) and this Rule.

(c) “Catamount Health carrier” or “carrier” means a carrier that sells, offers, issues or renews Catamount Health insurance as defined by § 4080f and this Rule. A carrier shall not sell Catamount Health unless the carrier is a registered small group carrier under 8 V.S.A. § 4080a.

(d) “Chronic care” means health services provided by a health care professional for an established clinical condition that is expected to last a year or more and that requires ongoing clinical management attempting to restore the individual to highest function, minimize the negative effects of the condition, and prevent complications related to chronic conditions. Examples of chronic conditions include, but are not limited to, diabetes, hypertension, cardiovascular disease, cancer, asthma, pulmonary disease, substance abuse, mental illness, spinal cord injury, and hyperlipidemia.

(e) “Chronic care management ” means a system of coordinated health care interventions and communications for individuals with chronic conditions, including significant patient self-care efforts, systemic supports for the physician and patient relationship, and a plan of care emphasizing prevention of complications, utilizing evidence-based practice guidelines, patient empowerment strategies, and evaluation of clinical, humanistic, and economic outcomes on an ongoing basis with the goal of improving overall health.

(f) “Commissioner” means the Commissioner of the Vermont Department of Banking, Insurance, Securities and Health Care Administration.

(g) “Community rating” means a rating process that produces average rates for those individuals insured by Catamount Health insurance for a given policy period. Community rating as used in this Rule may allow for premium deviations among individuals based on incentives pursuant to rules adopted by the Commissioner under 8 V.S.A. §§ 4080a(h)(2)(B) and 4080b(h)(2)(B) relating to health promotion and disease prevention.

(h) “Credibility” means a measure of the degree of statistical significance that can be assigned to the claims experience of a Catamount Health plan when it is used as a basis for projecting a future rate.

(i) “Creditable coverage” includes coverage defined under applicable federal law as creditable including: a group health plan, such as one obtained through an employer or spouse’s employer; health insurance coverage, including individual coverage; Medicare and Medicaid, CHAMPUS/TriCare; a medical program of the Indian Health Service Act or of a tribal organization; a state health benefits high risk pool; the Federal Employees Health Benefits Program; a public health plan; and a health benefit plan under section 5(e) of the Peace Corps Act. Subject to federal law, the definition of creditable coverage includes any hospital or medical service policy or certificate, hospital or medical service plan contract, or HMO contract offered by a health insurance issuer, which includes, but is not limited to, comprehensive nongroup, small group and large group policies.

(j) “Health care professional” means an individual, partnership, corporation, facility (including a hospital) or institution licensed or certified or authorized by law to provide professional health care services.

(k) “Health insurance trend factor” means a projection factor that is an estimate of the unit cost increases and utilization increases that are expected to be incurred in a health benefits plan. The estimate of unit cost increases and utilization increases may include consideration of erosion of deductibles, medical technology, general inflation and cost shifting.

(l) “Network” means the network defined by the carrier in its Catamount Health policy. Catamount Health networks shall be created and managed consistent with the purposes of the Act and other applicable law.

(m) “Preventive care” means health services provided by health care professionals to identify and treat asymptomatic individuals who have developed risk factors or preclinical disease, but in whom the disease is not clinically apparent, including immunizations and screening, counseling, treatment, and medication determined by scientific evidence to be effective in preventing or detecting a condition.

(n) “Primary care” means health services provided by health care professionals specifically trained for and skilled in first-contact and continuing care for individuals with signs, symptoms, or health concerns, not limited by problem origin, organ system, or diagnosis, and shall include prenatal care and the treatment of mental illness.

(o) “Uninsured” means an individual who does not qualify for Medicare, Medicaid, the Vermont health access plan, or Dr. Dynasaur and had no creditable private insurance or employer-sponsored coverage that includes both hospital and physician services within 12 months prior to the month of application, or lost creditable private health insurance or employer-sponsored coverage during the prior 12 months for the following reasons:

(i) the individual’s private insurance or employer-sponsored coverage ended because of:

(A) loss of employment;

(B) death of the principal insurance policyholder;

(C) divorce or dissolution of a civil union;

(D) no longer qualifying as a dependent under the plan of a parent or caretaker relative;

(E) no longer qualifying for COBRA, VIPER, or other state continuation coverage; or

(ii) college- or university-sponsored health insurance became unavailable to the individual because the individual graduated, took a leave of absence, or otherwise terminated studies.

(iii) “Uninsured individual” shall not include an individual who would be entitled to Catamount Health coverage without being uninsured for 12 months under 8 V.S.A. § 4080f(a)(9)(A) if the carrier determines, and the Commissioner gives prior approval to such determination, that such status was created primarily to obtain access to Catamount Health in a manner that is contrary to the intent of the Act. The Commissioner shall consult with appropriate legislative committees within 30 days following any such determinations.

(iv) In order to be considered an “uninsured individual”, a person shall be a Vermont resident and shall not be claimed as a dependent on a tax return by a person who is not a Vermont resident.

Section 4. Notice of Intent to Sell

A carrier intending to sell Catamount Health insurance shall submit a notice of intent to sell to the Commissioner no later than 30 days from the effective day of this Rule. Such letter shall identify the carrier and the anticipated dates the carrier intends to file for approval of Catamount Health rates and forms.

Section 5. Form Filings

(a) Carriers shall file all Catamount Health forms for approval by the Commissioner prior to use.

(b) Forms, as used in this Rule, shall include the following:

(i) all product forms, including but not limited to, policy forms, member handbooks, certificates, endorsements, riders, and applications;

(ii) materials intended to be publicly disseminated regarding chronic care management programs; and

(iii) materials intended to be publicly disseminated regarding wellness discount programs.

(c) No form shall be approved if it contains any provision which is unjust, unfair, inequitable, misleading, contrary to the law of this state or otherwise fails to comply with the requirements of the Act or 8 V.S.A. § 4080f.

(d) The carrier shall file for approval with the Commissioner the following documents prior to or contemporaneously with the filing of other forms under Section 5. The Commissioner shall approve such filings if in compliance with the goals of the Act and subject to such terms and conditions as he or she may prescribe.

(i) A chronic care management plan pursuant to Section 7 of this Rule.

(ii) A health care professional payment plan pursuant to Section 8 of this Rule.

(A) Health care professional payment plans shall be filed for approval when a Catamount Health carrier seeks to modify the methodology employed by the carrier to pay participating health care professionals. If amounts of the payment are the only modifications to the payment plan, no new filing is required.

(iii) A plan for determining eligibility pursuant to Section 10 of this Rule.

(iv) A cost containment plan consistent with the purposes of the Act.

(e) The Commissioner shall notify the carrier within 45 days from receipt of the filing whether the submission is approved or denied.

(f) Except as expressly provided to the contrary by this Rule, form filings shall be subject to the same rules and procedures applicable to other health insurance product filings.

Section 6. Benefit Design

(a) Catamount Health benefit design, as reflected in a carrier’s form filings, shall be approved by the Commissioner in accordance with the standards and procedures in 8 V.S.A. § 4080f, and other applicable law including 8 V.S.A. § 4062.

(b) All Catamount Health insurance plans shall include coverage for primary care, preventive care, chronic care, acute episodic care and hospital services. Such coverage shall be provided consistent with the purposes of the Act.

(c) The following out of pocket costs shall apply to Catamount Health policies. Catamount Health policies shall have:

(i) an annual deductible of $250.00 for an individual and a $500.00 deductible for a family for health services received in network, and a $500.00 deductible for an individual and a $1,000.00 deductible for a family for health services received out of network;

(A) A family deductible shall be satisfied when one insured, or a combination of insureds, satisfies the annual family deductible during the policy period.

(ii) 20% co-insurance for covered services received, other than office visits with a co-payment or prescription drugs, regardless of whether services are provided within or outside the carrier’s network;

(iii) a $10.00 office co-payment per individual, per visit;

(iv) prescription drug coverage with no deductible, however carriers may impose up to a $10.00 co-payment for generic drugs, $30.00 co-payment for drugs on the carrier’s preferred drug list, and a $50.00 co-payment for nonpreferred drugs;

(A) Prescription drug payments shall not count toward out of pocket maximums.

(v) annual out of pocket maximums shall be $800.00 for an individual, $1,600.00 for a family for in-network services and $1,500.00 for an individual and $3,000.00 for a family for out-of-network services.

(A) A family out pocket maximum shall be satisfied when one insured, or a combination of insureds, satisfies the annual family out of pocket maximum during the policy period.

(d) Carriers shall waive deductibles and other cost-sharing payments for chronic care if the individual is actively participating in a chronic care management program.

(e) Carriers shall waive deductibles and other cost-sharing payments for preventive care, provided such services are obtained in network. However, if preventive care services are not available in network, the carrier shall waive deductibles and other cost-sharing payments for preventive care services obtained outside of network.

(f) Preexisting Condition Limitation

(i) A Catamount Health carrier may limit coverage of a preexisting condition which existed during the 12-month period before the effective date of coverage, except that such exclusion or limitation shall not apply to chronic care provided such individual is participating in a chronic care management program.

(A) Participation in a chronic care management program shall mean that the individual has enrolled or has indicated a willingness to become enrolled in a chronic care management program and is in substantial compliance with the requirements of the program.

(1) For the purposes of this subsection, if an individual has indicated a willingness to become enrolled in a chronic care management program, a carrier may place reasonable time limits for the insured to become enrolled in the program. If the insured fails to meet these time limits, the carrier shall not be required to waive the preexisting condition limitation. In no event shall the carrier require the individual become enrolled in the chronic care management program in less than 15 business days.

(B) A Catamount Health carrier shall offer a chronic care management program to an insured if such a program is generally available to the carrier’s other insureds (whether through Catamount Health or otherwise) with the same chronic condition.

(C) Consistent with other applicable state and federal laws, qualifying participation in a chronic care management program shall not be premised on an individual achieving a specified health status, but it may be premised on specific participation obligations. If an individual’s health reasonably prevents specified participation, a carrier shall make reasonable alternative accommodations or credit the insured with participation in the chronic care management program.

(ii) A carrier shall waive any preexisting condition provisions for all individuals and their covered dependents who produce evidence of continuous creditable coverage during the previous nine months. The carrier shall credit coverage that occurred without a break in coverage of 63 days or more.

(iii) For an “eligible individual”, as that term is defined by Section 2741 of Title XXVII of the Public Health Service Act, as amended if amended, a carrier offering Catamount Health shall not limit coverage of a preexisting condition.

Section 7. Chronic Care Management

(a) Catamount Health carriers shall provide insureds access to chronic care management programs. Such programs shall be subject to approval by the Commissioner. Chronic care management programs shall be consistent with the purposes of the Act, including the use of criteria substantially similar to the chronic care management program established under 18 V.S.A. § 702 and 33 V.S.A. § 1903a, as amended.

(b) As directed by the Commissioner, Catamount Health carriers shall share data about their chronic care management programs, to the extent allowable by federal and state law, with the Vermont Secretary of Administration or designee in order to support health care reform initiatives under 3 V.S.A. § 2222a and related legislation.

Section 8. Health Care Professional Relationships

(a) Consistent with 8 V.S.A. § 4080f, benefits shall be delivered through a preferred provider organization (“PPO”) plan. Catamount Health carriers shall define their PPO within the parameters of commonly accepted industry practices, but such definition shall be consistent with the purposes of the Act.

(b) Subject to subsection (i) below, Catamount Health products may not limit the type of licensed health care professional offering a covered benefit, so long as that health care professional is operating within the scope of his or her practice authorized by law.

(i) Catamount Health products may impose a greater financial burden on an individual’s access to treatment by the type of health care professional only if it is related to the efficacy or cost effectiveness of the services, subject to the approval of the Commissioner. As appropriate, the Commissioner may consult with the Vermont Department of Health to establish whether limits are appropriately premised on the efficacy and cost effectiveness of the services.

(ii) Catamount Health carriers may impose credentialing criteria, consistent with the Act, on all participating health care professionals to ensure that minimum quality standards are met.

(c) Health care professional payments for care shall be made consistent with the Act. The carriers shall file a health care professional payment plan consistent with the provisions of this section, and subject to approval of the Commissioner under Section 5.

(i) Catamount Health carriers shall negotiate payment agreements with health care professionals that are consistent with the Act.

(ii) If Catamount Health carriers and health care professionals cannot agree on a payment agreement, the Commissioner shall prescribe the provisions of the agreement in dispute.

(iii) Nothing in this subsection shall be construed to mean that carriers or the Department may mandate health care professionals participate in Catamount Health.

(d) If Medicare does not pay for a service covered by a Catamount Health carrier, the carrier and health care professional shall negotiate a payment rate, subject to the approval or order of the Commissioner at his or her discretion.

(e) Health care professional payment shall be consistent with chronic care management principles, including, but not limited to, those developed under 18 V.S.A. § 702 and 33 V.S.A. § 1903a.

(f) A health care professional participating in a carrier’s Catamount Health network that treats a Catamount Health insured shall not balance bill the insured.

(i) “Balance bill” as used above means to charge to or collect from a Catamount Health insured any amount in excess of the charge agreed to for services provided to Catamount Health insureds by the Catamount Health carrier and the health care professional providing the service.

Section 9. Wellness Programs

A Catamount Health carrier may use financial or other incentives to encourage healthy lifestyles and patient self-management, in accordance with programs of health promotion and disease prevention established under rules adopted by the Commissioner pursuant to 8 V.S.A. §§ 4080a(h)(2)(B) and 4080b(h)(2)(B).

Section 10. Eligibility Determination

(a) Catamount Health insurance shall be offered, issued and renewed to all eligible individuals as defined by applicable law, including the Act and 8 V.S.A. § 4080f. After consultation with the Agency of Human Services with respect to an eligibility screening mechanism, carriers shall file a plan for determining eligibility consistent with the provisions of the this section, and subject to approval of the Commissioner under Section 5. Catamount Health carriers shall process Catamount Health applications within 30 business days from the date the application is completed.

(i) A carrier shall guarantee acceptance of any uninsured individual for any Catamount Health plan offered by the carrier. A carrier shall guarantee acceptance of each dependent of an uninsured individual in Catamount Health.

(A) A carrier shall not provide Catamount Health coverage for an individual of the age of majority who is claimed on a tax return as a dependent of a resident of another state.

(ii) Subject to subdivision (A) below, a carrier shall not sell Catamount Health to an individual who has access to employer-sponsored insurance through his or her employer.

(A) A carrier shall guarantee acceptance to an uninsured individual who has access to employer-sponsored insurance if the individual has an income under 300% of the federal poverty level and:

(1) the individual’s employer-sponsored health insurance plan is not an approved plan under 33 V.S.A. § 1974;

(2) pursuant to 33 V.S.A. § 1974, the Agency of Human Services has determined that enrolling the individual in Catamount Health with premium assistance is more cost effective for the State of Vermont than enrolling the individual in employer-sponsored insurance; or

(3) the individual is eligible for employer-sponsored insurance premium assistance under 33 V.S.A. § 1974, but is unable to enroll in the employer’s insurance plan until the next enrollment period.

(iii) An individual who loses eligibility for the employer-sponsored premium assistance under 33 V.S.A. § 1974 shall be allowed to purchase Catamount Health without being uninsured for 12 months.

(iv) For the purposes of this subsection, Catamount Health carriers shall accept proof of agency determinations when made under Title 33 relevant to eligibility as prescribed by the agency responsible for making such decisions.

(v) Catamount Health carriers and their producers shall inform each potentially eligible individual inquiring about purchasing health insurance in the nongroup market about the availability of Catamount Health and the existence of premium assistance programs.

(b) Catamount Health carriers shall follow those procedures in 8 V.S.A. § 4089h (including any subsequent amendments) for nonpayment of premium. However, to the extent an insured is receiving premium assistance for Catamount Health through a state or federal agency, the carrier shall follow any guidance, bulletins or rules provided by the agency providing premium assistance, to the extent any such guidance, bulletins or rules exist. As directed by the Commissioner, carriers shall give notice of nonpayment of premium and premium increases to the appropriate governmental agency.

(c) To the extent an individual is receiving or applying for Catamount Health premium assistance, carriers shall comply with, as determined by the Commissioner, any guidance, bulletins or rules issued by the governmental entity responsible for, or providing, premium assistance. In addition, Catamount Health carriers shall provide, to the extent allowed by law and as determined by the Commissioner, any information needed by the governmental entity to administer such premium assistance programs.

(d) Individuals who believe they are eligible for Catamount Health, but have been denied coverage, may file a complaint with the Department of Banking, Insurance, Securities and Health Care Administration. The carrier shall notify the applicant at the time of the denial of his or her rights to file a written complaint with the Department. The carrier’s appeal notice shall be on a form acceptable to the Commissioner. The Department shall provide written notice of the complaint to the carrier. If an informal resolution between the Department and the carrier cannot be reached within five business days of notice to the carrier, the carrier shall have ten days from the date the notice of the complaint was sent to file a written response. The Commissioner shall rule on the eligibility issue after receipt of the carrier’s response, provided a response is timely filed. If the Commissioner rules the individual and dependents are eligible for coverage, such coverage shall become effective retroactive to the date the carrier received the completed application. The carrier or the applicant may appeal an adverse decision by the Commissioner under this subsection pursuant to Rule 82-1 (Revised). Coverage shall remain in effect while an appeal is pending.

Section 11. Pay-for-Performance Demonstration Project

Upon petition by a carrier, or as required by the Commissioner, the Commissioner may establish a pay-for-performance demonstration project for Catamount Health insurance.

Section 12. Premium Rates

(a) Catamount Health premium rates shall be approved by the Commissioner prior to implementation. No rate shall be approved if it is unjust, unfair, inequitable, misleading or contrary to the law of this state. A rate shall be approved if it is sufficient not to threaten the financial safety and soundness of the insurer, reflects efficient and economical management, provides Catamount Health at the most reasonable price consistent with actuarial review, is not unfairly discriminatory, and complies with the other requirements of 8 V.S.A. § 4089f and the Act.

(b) Initial proposed Catamount Health rates shall be filed no later than five months after the carrier files its letter of intent to sell.

(c) Catamount Health premium rates shall be actuarially determined considering differences in the demographics of the populations and the different levels and methods of payment for health care professionals.

(d) After the initial rate filing referenced in subsection (b) above, Catamount Health carriers shall file for rate approval at least 100 days prior to the proposed implementation of the rates being filed for approval. The Commissioner shall rule on a rate filing within 45 days of receipt. If a rate filing is denied, written request for a hearing may be filed within 30 days of the notice of disapproval.

(i) Rate filings shall include a certification by a member of the American Academy of Actuaries which certifies a carrier’s compliance with this section and the Act. Such certification shall include sufficient detail for the Commissioner to verify that such certification is appropriate. Carriers shall provide additional information as requested by the Commissioner in order to verify representations in the rate filing.

(ii) The following statements by a member of the American Academy of Actuaries shall be included with each filing:

(A) the rates and proposed rating methodology meet the requirements of this Rule and 8 V.S.A. § 4080f; and

(B) the rates are reasonable in relation to the benefits provided, and they are neither excessive, deficient, nor unfairly discriminatory.

(iii) Rate filings shall include, at a minimum, the following:

(A) a description of the base claims experience data;

(B) actuarial support for the health insurance trend factor used to project the base claims experience data forward to the rating period and a copy of the data used to calculate the trend factors;

(C) a description of each element of retention;

(D) a description of all other adjustments or elements included in or used to calculate the rates;

(E) an identification of the effective date that the rates were designed for and the effective period of the rates. For example: “These rates have been designed to apply to [the carrier’s Catamount Health plan], renewing on or after xx/xx/xx and will remain in effect for twelve months following renewal”;

(F) an explanation of adverse selection factors considered by the carrier.

(e) Notice of a premium rate increase shall be provided to insureds at least 45 days prior to implementation, subject to waiver as approved by the Commissioner. In no event shall rate increases be implemented without at least 30 days written notice to the insured.

(i) In the event rate increase notices cannot be provided in a timely manner as defined by this section, the carrier shall extend existing rates at least until applicable notice periods have been satisfied. Existing rates extended under this subsection shall continue in one month intervals until new rates are approved.

(f) To be considered acceptable to the Commissioner, the rates submitted by a Catamount Health carrier shall be effective for at least a twelve-month policy period.

(i) Subject to approval by the Commissioner, premium rates shall be submitted at least for “single”, “two-person” and “family” (more than two persons) classifications.

(g) Catamount Health products shall be community rated. All of a carrier’s Catamount Health products shall have the same premium rate, subject to the classifications referred to in Section 12(f)(i) above, differing benefit levels and to the wellness or healthy discounts authorized by the Act, this Rule and any subsequent applicable law.

(i) Medical underwriting and screening to exclude or individually rate a Catamount insured is not allowed. Catamount Health shall be rated as a single group. Catamount Health carriers shall not use rating plans which contain any provisions for adjustments that are based upon medical underwriting or medical screening.

(ii) Proposed community rates should be based upon reasonable projections of Catamount Health experience that has been incurred or is anticipated to be incurred. To the extent that the carrier’s Catamount Health claims experience is not deemed to be fully credible, it can be combined with the carrier’s other Vermont experience as deemed appropriate by the Commissioner.

Projections of the base claims experience forward to the period for which the proposed community rates are designed to be effective should be accomplished with the use of an appropriate health insurance trend factor.

(iii) In addition to the expected claims cost, the carrier’s community rates may contain appropriate allowances for administrative expenses, taxes, profit (in the case of for-profit carriers) or contribution to reserves (in the case of a nonprofit entity) and the cost of reinsurance, if any, and other elements used by the carrier as approved by the Commissioner.

(iv) The approved premium rates for the Catamount Health product shall not be adjusted for demographics (including age or gender), geographic area, industry, medical underwriting or screening, experience rating, tier rating or durational rating. Credit for healthy lifestyle or wellness program discounts are allowed and shall be shown in the rate filing.

(h) If a carrier discontinues sales of the Catamount Health product pursuant to 8 V.S.A. § 4080f(n), the carrier shall continue to file for rate approval subject to this Rule for those lives that continue to be covered under existing policies. However, if a carrier does not file for rate approval, the Commissioner shall establish the appropriate premium rates in accordance with the statute.

Unified Health Care Budget

Regulation
Wednesday, August 1, 2001
Reg-H-Rule-7.000

File attachments: 

http://www.dfr.vermont.gov/sites/default/files/REG-H-7.000.pdf

Rule 7.000 (Revised August 1, 2001)

UNIFIED HEALTH CARE BUDGET

7.000 General Provisions

7.001 Authority.  This rule is promulgated by the Department of Banking, Insurance, Securities and Health Care Administration under the authority of 18 V.S.A. §§ 9404(d)(2), 9453(b), and 9456(e).

7.002 Applicability. This rule shall apply to health care facilities, health care providers, and other persons affected by the unified health care budget adopted by the Commissioner pursuant to 18 V.S.A. § 9406(a) and the hospital budget review process under 18 V.S.A. §§ 9451 – 9457.

7.003 Purpose. Section 9406 of Title 18 requires the Department of Banking, Insurance, Securities and Health Care Administration to adopt a unified health care budget as one means of achieving the policies set forth in 18 V.S.A. § 9401, including quality health care for all Vermonters at an affordable price. The budget is to serve as the basic frame­work within which health care costs in Vermont can be controlled, resources directed, and quality and access ensured. This rule establishes the proce­dures through which a unified health care budget will be adopted by the Department.

7.004 Definitions

(A) “Commissioner” means the Commissioner of the Department of Banking, Insurance, Securities and Health Care Administration

(B) “Department” means the Department of Banking, Insurance, Securities and Health Care Administration.

(C) “Division” means the Division of Health Care Administration of the Department of Banking, Insurance, Securities and Health Care Administration established under 18 V.S.A. § 9403.

(D) “File” means receipt by the Division of a written document.

(E) “Fiscal year” or “year” means a twelve-month period designated by the Division under Section 7.900 of this rule.

(F) “Health care facility” means all facilities and institutions, whether public or private, propri­etary or nonprofit, that offer diagnosis, treatment, inpatient or ambulatory care to two or more unrelated persons. The term shall not apply to any facility operated by religious groups relying solely on spiritual means through prayer or heal­ing, but includes all facilities and institutions included in 18 V.S.A. § 9432(10).

(G) “Health care provider” or “provider” means a person, partnership or corpora­tion, other than a facility or institution, licensed or certified or authorized by law to provide professional health care service in Vermont to an individual during that individual’s medical care, treatment or confinement.

(H) “Person” means a natural person, partnership, unincorporated association, corporation, municipality, the state of Vermont or a department, agency or subdivi­sion of the state, or other legal entity.

(I) “Provider bargaining group” means a group of health care providers authorized to negotiate with the Department pursuant to Rule 6.000.

(J) “Public Oversight Commission” means the commission established pursuant to 18 V.S.A. § 9407(a).

(K) “Sector” means a part of the unified health care budget as defined by the Commissioner in accordance with Section 7.100 of this rule.

(L) “Unified health care budget” or “budget” means the annual budget adopted by the Commissioner pursuant to this rule and 18 V.S.A. § 9406.

(M) “Uniform reporting manual” or “manual” means the uniform reporting manual published by the Division, including appendices and supplements, and any subsequent revisions of the manual.

(N) “Vermont resident” or “resident” means a person who is domi­ciled in Vermont and who, if temporarily absent, demonstrates an intent to maintain a principal dwelling place in Vermont indefinitely, coupled with an act or acts consistent with that intent.

7.005 Timelines. The timelines estab­lished in this rule may be changed by the Division as necessary to accommodate the activities of the Division in establishing a unified health care budget from year to year. Any such change shall be effective the budget year following notice by the Division to all hospitals and to all provider bargaining groups approved under Rule 6.000. Notice shall be sent by first-class mail and is deemed given on the date mailed. A copy of such change shall be filed at the same time with the secretary of state’s office.

7.006 Confi­dential­ity. The Division and its advisory groups shall handle all confidential information filed with it under this rule in accordance with the Division’s Confidentiality Code, its policies governing the release of confidential and proprietary information, and any applicable federal or state statute, rule or regulation that prohibits or otherwise affects the release or disclosure of the information.

7.100 Sectors of the Unified Health Care Budget. The Division and its advisory groups shall handle all confidential information filed with it under this rule in accordance with the Division’s Confidentiality Code, its policies governing the release of confidential and proprietary information, and any applicable federal or state statute, rule or regulation that prohibits or otherwise affects the release or disclosure of the information.

7.101 Definition of Sectors. 18 V.S.A. § 9406(a)(3) re­quires the Commissioner to define the various health care sectors of Vermont’s health care system that will be separately identified in the budget. That health care system consists of a variety of people, assets and services, many combinations of which could be considered sectors for purposes of the unified health care budget. Sectors could be defined in many ways, including but not limited to: by providers, by services offered through a state­wide uniform package, by institutions, by integrat­ed systems of care or other managed-care organiza­tions, by geographic region, and by funding source.

(A) New defini­tions.

(1) The Division shall periodically publish changes to its definitions of sectors to be separately identified in the following year’s unified health care budget.

(2) Health care facilities, provider bargain­ing groups, and other interested persons may file with the Division any written responses, comments, or alternatives to the proposed changes to the Division’s sector definitions. Prior to adopting the proposed changed sectors, the Division shall consult with health care facilities, provider bargain­ing groups, and other interested persons and consider their comments.

(3) The Division shall consider the written submissions and may, in its discretion, hold one or more meetings with health care facilities, provider bargaining groups, and other interested persons to discuss the changes to the sec­tors to be separately identified in the fol­lowing year’s budget.

(4) The Division shall then adopt the sectors, and shall distribute copies of the adopted sectors to health care facilities, provider bargain­ing groups, and such other persons who request it.

7.200 Data Neces­sary to Support the Uni­fied Health Care Budget.

7.201 Unified Health Care Data Base. Health care providers, health care facilities and other persons shall comply with the data filing require­ments of 18 V.S.A. § 9410 and 9454 and any rules promulgated thereunder.

7.202 Uniform Reporting Manual. In addition to any unified health care data base filing require­ments, hospitals shall file the information required by the uniform reporting manual in the time, place and manner described in the manual.

7.203 Supplemental Information. The Division may require health care providers, health care facilities and other persons to file supplemental information deemed necessary to the development of expenditure analyses, expenditure forecasts, or the unified health care budget.

7.300 Indica­tors.

In preparing its budget forecast each year under Section 7.402 and in adopting a final unified health care budget under Section 7.406 of this rule, the Division may use the following indicators:

(A) Gross state product. The annual change in the gross state product of Vermont.

(B) Inflation indices. Inflation projections as forecast by the federal Health Care Financing Administration or other econom­ic forecasters built upon a market-basket of goods and services for a given industry.

(C) Utilization cost. A variable cost indicator established to measure utilization costs related to changes in ser­vice usage.

(D) Service case mix. Variable costs associated with changes in the intensity of services or care to be provided.

(E) State and federal budgets. Government program reimbursement estimates that affect hospital pricing.

(F) State economic forecast. The annual economic forecast by the Govern­or’s office.

(G) Cost-Shift Impacts. The Division’s estimate of the impact of cost-shifting.

(H) Cost per unit. Costs, including adjustments for case mix and units of service.

(I) Epidemiology measures. Changes to underlying incidence of disease and the demographics of the service area.

(J) Use Rate. A use rate indicator based upon the population of the service area established for evaluating hospital service area utilization.

(K) Other factors. Any other factors or consider­ations deemed appropri­ate by the Division.

7.400 Process for Establishing the Unified Health Care Budget.

The Commissioner shall establish a unified health care budget annually. The process of establishing the budget shall include, but not be limited to, analysis by the Division of the expenditures of health care sectors for the most recent full fiscal year for which data are available, analysis of budget figures submitted by the sectors, and public discussion of the proposed budget forecast.

7.401 Identification of Vermont Expenditures. On or before July 1 of each year, the Division shall publish a health care expenditure analysis. This analysis will identify the total amount of health care expendi­tures collected by Vermont providers and the total amount of health care expenditures made by Vermont resi­dents for the most recently-ended fiscal year for which data are available.

(A) Expenditures by Vermont health care providers and categories of services. Using the data obtained pursuant to Sec­tion 7.200 of this rule and 18 V.S.A. § 9410, the Division shall identify all funds received in the preced­ing fiscal year by Vermont health care facilities and providers. To the extent possible, the Division shall identify which portions of this sum were spent by or on behalf of Vermont residents and which por­tions were spent by or on behalf of resi­dents of other states or countries.

(B) Expenditures on Vermont residents. Using the data obtained pursuant to Sec­tion 7.200 of this rule and 18 V.S.A. § 9410, the Division shall identify all funds spent on health care services in the preced­ing fiscal year by or on behalf of Vermont resi­dents, regardless of where the services were ren­dered or obtained. To the extent possi­ble, the Division shall identify which portions of this sum were paid to health care facilities or providers within Vermont, and which por­tions were paid to health care facilities or providers outside Ver­mont.

(C) Other expenses. The Division shall also identify other expenses affecting Vermont’s health care system, including but not limited to private and public administrative and governmental expenses.

7.402 Establishment of a Unified Health Care Budget Forecast. On or before July 1, the Division shall prepare a proposed budget forecast for the next fiscal year based on its analy­sis of health care expendi­tures under this section, the letters of intent as to proposed new institutional health services filed under 18 V.S.A. §§ 9431 – 9445, the information filed in the unified health care data base otherwise required under Section 7.200 of this rule, the budgets submitted by the hospitals on July 1, and any other information deemed relevant by the Division. A copy of the proposed budget forecast shall be sent to Vermont hospi­tals, provider bargaining groups, the Public Oversight Commission, and such other persons who request it.

7.403 Health Care Facili­t­ies and Health Care Provider Bargaining Groups. The Division may hold one or more meetings with health care facilities, provider bargaining groups, and other interested persons ­regarding the proposed budget forecast. Negotiations with the provider bargain­ing groups shall be conducted pursuant to Section 6.500 of the Department rules relating to provider bargain­ing groups and 18 V.S.A. § 9409(a).

7.404 Budget Forecast Review. In establishing the unified health care budget the Commissioner shall take into consideration the proposed budget forecast, the comments and recommenda­tions of the Public Oversight Commission, and the oral and written comments made in the course of the public hearing conducted pursuant to Section 7.504(B), the comments of health care facilities, provider bargaining groups, or other interested persons received under Section 7.403 and any other consider­ations deemed appro­priate by the Division.

(A) The Public Oversight Commission shall con­sider the proposed budget forecast in conducting its hospital budget reviews under 18 V.S.A. § 9456 and Section 7.500 of this rule.

7.405 Unified Health Care Budget. The Commissioner shall establish a unified health care budget for the next fiscal year on or before October 1.

 

7.500 Application of Unified Health Care Budget to Hospital Budget Reviews.

Pursuant to 18 V.S.A. § 9406(b)(3), the unified health care budget shall apply to the hospital budget review process under subchapter 7 of Title 18. The Division shall have primary responsibility for collecting and evaluating hospital financial information and reviewing all hospital budgets in conformity with the provisions of subchapter 7 and this section, and recommending the budgets to be adopted by the Commissioner. At a minimum, the hospital budgets shall include all acute-care hospitals in Vermont and all expenditures and revenues associated with the hospital organizational reporting structure.

7.501 Uniform Formats for Data Filings. Hospitals shall use the methods and formats set forth in the uni­form reporting manual in reporting their financial, scope-of-services, and utilization data and infor­mation to the Division under Section 7.200 of this rule, using the uniform reporting forms and uniform chart of accounts contained in the manual.

7.502 Establishing Benchmarks. On an annual basis, the Division will develop benchmarks for the indicators in Section 7.300 for development and preparation of the upcoming fiscal year’s hospital budgets. The Division may obtain input from the Public Oversight Commission, the Vermont hospitals, and the Vermont Association of Hospitals and Health Systems prior to establishing the benchmarks. The established benchmarks shall be included in the uniform reporting manual, which shall be provided to the hospitals by March 31.

The uniform reporting manual benchmarks will allow the Division to:

(1) make a determination whether to waive the need for a hospital to present its budget to the Public Oversight Commission at a public hearing; and

(2) will be used by the Commissioner to determine whether a budget may be adjusted.

The established benchmarks, as supported under Section 7.300, may include the following:

1) growth indicators,

2) prior budget performance,

3) efficiency or productivity indicators,

4) capital investment indicators,

5) profitability indicators,

6) cost and price indicators,

7) liquidity indicators,

8) debt structure indicators,

9) other financial measures recognized or used in evaluating budgets and/or financial plans.

7.503 Hospital Duties and Obligations. On or before July 1 of each year, each Vermont hospital shall file the following information with the Division, in addition to any other information re­quired by the uniform reporting manual:

(A) its proposed budget for the next fiscal year, including expenditures and revenues for Vermont residents and non-Vermont residents;

(B) financial information, including but not limited to its costs of operation, revenues, assets, liabili­ties, fund balances, other income, rates, charges, units of service, and wage and salary data;

(C) scope-of-service and volume-of-service information, including but not limited to inpatient services, outpatient services, and ancillary services, by type of service provided;

(D) utilization information;

(E) a description of new hospital services and pro­grams proposed for the next fiscal year, regardless of whether they are or may be subject to the cer­tifi­cate of need review process under subchapter 5 of Title 18;

(F) a projected three-year capital expenditure budget;

(G) the financial condition of the hospital;

(H) the na­ture of the services offered by the hospitals that are subject to the budget;

(I) the needs of the populations served by the hospital;

(J) the spe­cialized or fran­chised services offered by the hospital; and

(K) such other infor­mation as may be re­quired by the Division or Public Oversight Commission.

7.504 Division Review Process After the financial infor­mation required under Section 7.503 is filed with the Division, the Division shall conduct reviews of all proposed hospital budgets, as follows:

(A) Information available to the public. The Division shall make the financial informa­tion filed under Section 7.503 available to all persons upon request. The Division may charge the actual copy­ing costs incurred in providing such information to the persons re­questing the informa­tion.

(B) Public Hearing. Upon receipt by the Division of all financial information filed under Section 7.503, the Division shall arrange for the Public Oversight Commission to hold public hearings concerning the hospitals’ budgets. The hospitals, except for those hospitals exempt from the hearing pursuant to Section 7.504(D), shall provide testimony and respond to questions raised by the Public Oversight Commission, the Division, or the public. The Public Oversight Commission shall advise and make recommendations to the Commissioner concerning the hospital budgets.

(C) Use of Benchmarks. The Division’s established benchmarks, outlined in Section 7.502, shall guide the Commissioner in his/her decision to adjust or not to adjust a hospital’s budget.

(D) Exemption from Public Hearing. Hospitals that meet the established benchmarks may be exempt from the Public Oversight Commission public hearing outlined in Section 7.504(B) in the following instance only:

1. A hospital may be exempt from the public hearing when they meet established benchmarks. Notwithstanding a hospital’s budget meeting the benchmarks, no hospital may be exempt from the public hearing process for more than one year consecutively. In any given year, only four hospitals may be waived from attending a public hearing; hospitals that are waived from attending the public hearing will not have their budgets adjusted.

The four (4) largest hospitals, as measured by the hospitals’ previous year’s net patient revenue, shall not be exempt from the public hearings in any year.

(E) Budget Adjustments. Hospitals that do not meet the established benchmarks outlined in Section 7.502 may be subject to budget adjustments.

(F) Review process. The Division shall meet with hospi­tals to review and discuss their pro­posed budgets, as to which the hospitals have the burden of persuasion. The Division’s budget reviews shall take into consider­ation the following, as well as the advice and recommendations of the Public Oversight Commission:

(1) the proposed unified health care budget forecast for the next fiscal year;

(2) utilization information;

(3) the goals and recommendations of the state health plan and CON Guidelines adopted under 18 V.S.A. § 9405, 9556(b)(2), and 9437(5);

(4) the actual performances of hospitals with respect to past budgets;

(5) reports from professional review organizations relating to Vermont hospitals or health care services provided through Vermont hospitals (excluding hospital internal quality and utilization review reports);

(6) the established benchmarks; and

(7) any other information it deems relevant or appropriate to hospital budgets.

(G) Estab­lish­ment of Hospi­tal Budgets. On or before September 15, the Commissioner shall establish Vermont hospital budgets for the next hospital fiscal year based on the review of the proposed budgets by the Division, the advice and recommendations of the Public Oversight Commission, and the comments of the public. On or before October 1, the Commissioner shall issue a written decision establishing the hospitals’ budgets for the next fiscal year. The hospital budgets established by the Commissioner shall modify or supplement the proposed unified health care budget forecast.

7.600 Applica­tion of Unified Health Care Budget to Certificate of Need Review

Pursuant to 18 V.S.A. § 9436(a)(2), the uni­fied health care budget shall apply to the certificate of need (CON) review process under subchapter 5 of Title 18 and any regulations promulgated thereunder.

7.700 Application of Unified Health Care Budget to Other Sectors [Reserved.]

7.800 Enforcement

The Division shall enforce those portions of the unified health care budget affecting hospital budgets and the certificate of need review process as follows.

7.801 Hospitals. The Division shall periodically review the performance of hospitals under the budgets established for them. This review may occur at any time through independent review by the Division of a hospital’s performance.

(A) Review criteria. The Division’s review of a hospital’s performance under an established budget shall take into consideration the following factors:

(1) the variability of a hospital’s actual revenues, which depend on the resources of payers and the methods of payment used by the payers;

(2) the hospital’s ability to limit services to meet its budget, consistent with its obligations to provide appropriate care for all patients;

(3) the financial position of the hospital in relation to other hospitals and to the health care system as a whole, using the statistics developed from information submitted in compliance with the uniform reporting manual;

(4) any other considerations deemed appropriate by the Division, including but not limited to other instances in which a hospital has less than full control over the expendi­tures limited by the budget; and

(5) the hospital’s performance under budgets identified or established under subchapter 7 of Title 18 for the previous three years and its budget projections for the next three years.

(B) Adjustment methods. After making a determination of a hospital’s performance under an established budget, the Division may recommend to the Commissioner an adjustment to the hospital’s budget. Any such adjustment shall take into account the factors set forth in subsection 7.801(A).

(1) Where a determination is made that a hospitals performance has differed substantially from its budget, the Commissioner may adjust its budget by:

(a) changing hospital rates or prices by the amount of net revenues exceeding the budgeted net revenues;

(b) changing the net revenue and/or expenditure levels of future budgets.

(c) allowing hospital rates to be increased for a hospital with a deficit caused by revenues that were less than projected, but whose actual expenditures were within the budget limits;

(d) allowing a hospital to retain surplus funds if the surplus was achieved while the hospital stayed within its established budget;

(e) allowing a hospital to retain a percentage of surplus generated primarily by volume in excess of that projected for a particu­lar year; or

(f) any other circumstance the Commissioner deems appropriate.

(C) Application. Adjustment methods based on past performance shall be applied by the Division in the course of establishing a new budget and may be imposed over a multi-year period. In recommending adjustment of a hospital’s budget, the Division shall consider the financial condition of the hospital and any other factor it deems appropriate.

7.802 Certificate of Need Reviews. Adjustment methods available as to persons subject to the certificate of need review process may be set forth in the Department’s certificate of need regulations.

7.803 Exceptional or Unforeseen Circumstances. In determining the appropriate adjust­ments that will be applied to a person or sector that the Division has determined is not in compliance with the unified health care budget, the Commissioner must consider any exceptional or unforeseen circumstances that may have affected the person’s or sector’s ability to comply.

(A) The person or sector whose compliance is at issue has the burden of proving the existence of exceptional or unforeseen circumstances, as well as the effect those circum­stances had on his or her ability to comply with the applicable portion of the unified health care budget.

(B) Any person or sector relying on the existence of an exceptional or unforeseen circumstance as a reason for a failure to comply with the budget shall also recommend to the Division a proposed course of action that will bring its budget into compliance. Such a course of action includes, but is not limited to, review of the person’s budget compli­ance over a span of years or an adjustment to the person’s base for the succeeding fiscal year.

7.900 Fiscal Year

7.901 Definition. The fiscal year is initially defined as the twelve-month period beginning on October 1 of each year.

7.902 Modification of Fiscal Year. The Division may change the fiscal year as it applies to the unified health care budget or to individual sectors within the budget from time to time. Public notice of such a change shall be made in newspapers of record in the manner provided for the publication of proposed rules under 3 V.S.A. § 839, and notice shall also be given by the Division by first-class mail to all provider bargaining groups approved under Rule 6.000. The change shall be effective 90 days after notice has been given.

7.903 Conforming Amendments to Rule. The Division, upon adoption of a different fiscal year, shall promptly file the necessary proposed changes to this rule so as to conform to the new fiscal year. Proposed changes shall be temporarily effective upon filing of the proposal with the secretary of state under 3 V.S.A. § 838 until the adoption of the final changes.

Provider Bargaining Groups

Regulation
Wednesday, June 15, 1994
Reg-H-Rule-6.000

File attachments: 

http://www.dfr.vermont.gov/sites/default/files/REG-H-6.000.pdf

HEALTH CARE AUTHORITY

Rule 6.000

6.000 PROVIDER BARGAINING GROUPS

6.100 Authority

This rule is promulgated by the Health Care Authority under the authority of 18 V.S.A. §§ 9404(d)(2) and 9409(b).

6.200 Scope and Purpose

Section 9406 of Title 18 requires the Health Care Authority to establish a unified health care budget on an annual basis. In preparing the budget each year, the Authority will engage in discussions with representatives of many sectors of Vermont's health care system, including but not limited to health care providers, so that the budgeting process is based on as much information as possible. Individual health care providers who wish to negotiate with the Authority may feel constrained, however, from full participation for fear that their activities will be deemed anticompetitive behavior subject to sanctions under applicable antitrust laws. This rule allows health care providers to benefit from the "state action immunity doctrine" under which a state may allow certain anticompe­titive behavior, so long as the behavior is clearly articulated and actively supervised. To that end, this rule is designed to implement 18 V.S.A. § 9409(a) by governing the creation of provider bargaining groups, clearly articulating the scope of the matters that groups can negotiate with the Authority and the health care purchasing pool, and providing for active supervision of all approved activities by the state. Once approved under this rule, a provider bargaining group will be able to engage in the types of negotiations authorized herein without the threat of a challenge under the antitrust laws.

6.201 Applicability

This rule shall apply to health care providers negotiating, or desiring to negoti­ate, with the Health Care Authority or the health care purchasing pool any matters authorized under 18 V.S.A. § 9409(a).

6.202 Purpose

Section 9409 of Title 18 permits the Health Care Authority Board to approve the creation of one or more provider bargaining groups, consisting of health care providers who choose to participate in such groups. This rule defines the criteria governing the formation and approval of provider bargaining groups and the activities authorized by § 9409(a).

6.203 Definitions

(A) "Authority" means the Health Care Authority estab­lished under 18 V.S.A. § 9403(a).

(B) "Board" means the board of the Authority estab­lished under 18 V.S.A. § 9403(b).

(C) "Health care facility" means all facilities and institutions, whether public or private, proprietary or nonprofit, that offer diagnosis, treatment, inpatient or ambulatory care to two or more unrelated persons. The term shall not apply to any facility operated by religious groups relying solely on spiritual means through prayer or healing, but includes all facilities and institutions included in 18 V.S.A. § 9432(10).

(D) "Health care provider" or "provider" means a person, partnership or corporation, other than a facility or institution, licensed or certified or authorized by law to provide profession­al health care service in Vermont to an individual during that individual's medical care, treatment or confinement.

(E) "Health care purchasing pool" or "purchasing pool" means the purchasing pool established by the secretary of administration pursuant to 18 V.S.A. § 9413(a).

(F) "Provider bargaining group" means a group of health care providers authorized under this rule to engage in negotiations with the Authority and the purchasing pool.

(G) "Sector" means a part of the unified health care budget as defined by the Authority.

(H) "Unified health care budget" means the annual budget adopted by the Board pursuant to 18 V.S.A. § 9406(b).

6.300 Formation and Approval of Provider Bargaining Groups

6.301 Criteria Governing Approval as Provider Bargaining Group

A group of health care providers may be approved by the Authority as a provider bargaining group if the group seeking approval has shown:

(A) Status as health care providers: that all members of the proposed bargaining group are licensed, certified or authorized by law to provide professional health care services in the state of Vermont;

(B) Common interest: that all members of the group are linked by a specified common interest such that negotiations with them as a group, rather than as individual providers, will be effective and efficient; for purposes of this rule, a "common interest" could include, but is not limited to, being licensed in the same profession, practicing in the same health care entity or facility, or belonging to the same professional practice group;

(C) Nondiscrimination:­ that the proposed bargaining group will not exclude from its membership health care pro­viders who share the common interest linking the group under subsection (B) of this section;

(D) Authority to represent members: that the group is represented by one or more individuals with express authority to represent group members' interests before the Authority or the purchasing pool;

(E) Unified health care budget: that the group has, or will have, a significant effect on the costs of one or more sectors of the unified health care budget and on resource allocation consistent with the health resource management plan adopted under 18 V.S.A. § 9405; and

(F) Public interest: that the group is of sufficient size and represents a sufficient sector or portion of health care providers such that it will be in the public interest for the Authority or the purchasing pool to engage in negotiations with it under 18 V.S.A. § 9409.

6.302 Application Procedure for Approval as Provider Bargaining Group

(A) A group of health care providers seeking approval as a provider bargaining group shall file a written application (original and five copies) with the Authority. The application shall set forth in detail how the proposed bargaining group meets the criteria set forth in § 6.301, above.

(B) The Authority shall review the application and, within fifteen working days, notify the applicant either that the application is complete or that additional information is required.

(1) Applicants shall respond to requests for additional information within fifteen working days. Failure of an applicant to do so may, in the discretion of the Board, be considered a withdrawal of the applica­tion. An applicant's response time may be extended by the Authority for good cause shown.

(2) The Authority shall review additional information filed in response to its request and, within fifteen working days, notify the applicant either that the application is complete or that additional information is still required. Further requests for information under this section shall be subject to the same review and response guidelines as the original request for additional information.

(3) If the Authority fails to notify the applicant in a timely manner that an application is either complete or incomplete under this subsection, the application shall be deemed to be complete on the sixteenth working day after the date the application was filed or the last information was received, whichever is later.

(C) When an application has been deemed complete, the Authority shall fully review the application under the criteria established in § 6.301 of this rule.

(1) The Authority may in its discretion schedule a hearing on the completed application, at which time the applicant, and other parties, at the discretion of the Board, will be given the opportunity to present support for the application and the Board will have the opportunity to inquire into the merits of the application.

(2) The applicant may request such a hearing before the Board at the time it files its application or at any time before the application is deemed complete.

(3) A hearing under this subsection is an informal process designed to give the applicant and the Board the opportunity to discuss the merits of the application. It is not a "contested case" as that term is used in the Vermont Administrative Procedure Act and is not subject to the provisions of that act.

(D) The Authority shall complete its review and the Board shall make a decision either to approve or to deny the application within forty-five days of the date the application was deemed complete, or within sixty days if a hearing was requested by the applicant or scheduled by the Authority. For purposes of this rule, the completion date is either the date that notification is sent to the applicant that the application is complete, or the date established under § 6.302(B)(3), above.

(E) The Authority may, in its discretion, issue a conditional approval to a provider bargaining group, including limitations on the matters that a group will be authorized to negotiate under 18 V.S.A. § 9409 and this rule.

6.303 Effect of Approval as Provider Bargaining Group

Once approved, a provider bargaining group may, subject to any limitations imposed under § 6.302(E) of this rule, participate in the activities set forth in § 6.400 of this rule for three years or until its approval is revoked, whichever is earlier.

6.304 Review and Extension or Revocation of Approval as Provider Bargaining Group

(A) The Authority shall review each provider bargaining group's qualifications under the criteria established in § 6.301 of this rule at least three months before a group's approval expires. If the Authority is satisfied that the group continues to meet the criteria, it may extend the bargaining group's approval for another three years; otherwise, it will allow the group's approval to expire.

(B) The Authority may, upon notice, review a provider bargaining group's qualifica­tions under this rule at any time before its approval expires if it has reason to believe that the group may no longer meet the criteria in § 6.301. If the Authority is satisfied that the group continues to meet the criteria, it may either extend the bargaining group's approval for another three years from the time of the review, or allow the original three-year period to continue to elapse, in which case the group will be subject to an additional review in accordance with § 6.304(A), above. If the Authority finds, after a review conducted under this section, that a group no longer satisfies the criteria for recognition as a provider bargaining group, it shall revoke the group's approval effective immediately.

6.400 Scope of Authorized Activities

6.401 Once approved in accordance with § 6.300 of this rule, a provider bargaining group is authorized:

(A) to negotiate with the Authority

(1) the establishment or definition of the sectors of the health care system separately identified in the unified health care budget;

(2) the methods or processes used by the Board in allocating resources among the sectors;

(3) the economic indicators used by the Board to define the parameters of the rate of growth in the cost of the health care system and its sectors;

(4) processes and criteria for responding to exceptional and unforeseen circumstances affecting the system and its sectors;

(5) the establishment of the total amounts to be paid for services provided by the system and its sectors; and

(6) any matter related to the reimbursement of health care providers under the unified health care budget; and

(B) to negotiate with the purchasing pool

(1) contracts for the delivery of health care services, including agreements securing discounts for regular, bulk payments to providers and agreements establishing uniform provider reimburse­ment; and

(2) any matter related to the reimbursement of health care providers by the purchasing pool.

6.402 Nothing in this section shall be construed to authorize a provider bargaining group to engage in any activities other than those specified in 18 V.S.A. § 9409(a) and in § 6.401 of this rule.

6.500 Procedures for Authorized Activities

6.501 Negotiations with the Authority Related to Sectors of the Unified Health Care Budget

(A) On or before October 1 of each year, the Authority shall notify all provider bargaining groups that negotiations will begin for the adoption of the next fiscal year's unified health care budget. The Authority may, in its discretion, furnish copies of its proposed unified health care budget, including the sectors to be included in the budget, if any, to the groups at that time.

(B) On or before November 1, if the Authority has furnished provider bargaining groups with copies of a proposed budget, each group shall file with the Authority, in writing, its response to the proposed budget, and shall furnish copies of its response to all other provider bargaining groups approved under this rule. The Authority shall conduct at least one public hearing on the responses filed by provider bargaining groups.

(C) Between November 2 and March 1, the Authority shall meet with provider bargaining groups to negotiate any matter authorized by 18 V.S.A. § 9409(a) and Section 6.401 of this rule relating to the unified health care budget, including the reimbursement of sectors once defined. If in the course of these negotiations the Authority and a provider bargaining group reach agreement as to the reimbursement of the health care providers represented by the bargaining group, on or before July 1 the Authority may enter into a nonbinding reimbursement contract with the group.

(D) If the provider bargaining groups and the Authority do not agree on resolution of the matters being negotiated, including the designation and establishment of appropriate sectors within the unified health care budget, any such issue shall be referred to an arbitration panel no later than March 1.

(1) The arbitration panel shall consist of one member chosen by the Health Care Authority, one member chosen by the provider bargain­ing groups involved in the dispute, and one member to be chosen by the first two panel members.

(2) The arbitration panel shall review the matters in dispute and make a recommendation as to resolution of those matters to the Board within thirty days, but in no event later than April 1.

(3) Nothing in these rules shall be construed to limit the Board's authority to reject the recommendation or decision of the arbitration panel or to limit the Board's authority under 18 V.S.A. § 9406 to establish the unified health care budget.

(E) The Authority may elect to hold one or more public hearings between March 1 and April 30 relating to the results of its negotiations with provider bargaining groups on the proposed unified health care budget.

6.502 General Negotiations with the Authority as to Provider Reimbursement

The Authority shall meet with a provider bargaining group, from time to time, at its discretion or at the request of the group, to negotiate any matter related to the reimbursement, under the unified health care budget, of the health care providers represented by the group, and may enter into a nonbinding contract with the group as to reimbursement.

6.503 Purchasing Pool

The purchasing pool shall meet with a provider bargaining group from time to time, at its discretion or at the request of the group, to negotiate any matter related to contracts with the pool for the delivery of health care services by the health care providers represented by the group and the reimbursement of such health care providers by the purchasing pool, and may enter into a contract with the group as to reimbursement.

6.504 Timelines

The timelines established in Section 6.501 of this rule may be changed by the Authority as necessary to accommodate the activities of the Authority in establishing a unified health care budget from year to year. Any such change shall be effective thirty days after notice by the Authority to all approved provider bargaining groups. Notice shall be sent by first-class mail and is deemed given on the date mailed. A copy of such change shall be filed at the same time with the Secretary of State's office.

6.600 Active Oversight of Authorized Activities

The Authority shall actively monitor and oversee the activities engaged in by provider bargaining groups. Such active monitoring and oversight shall consist of at least the following:

(A) No provider bargaining group shall engage in negotiations with the Authority or the purchasing pool until the group has applied for status as, and been approved as, a provider bargaining group pursuant to § 6.300 of this rule.

(B) The Authority, as set forth in § 6.304 of this rule, shall periodically review each provider bargaining group to ensure that the group continues to meet the criteria required for the establishment and approval of a provider bargaining group.

(C) The Authority shall actively participate in all negotiations with provider bargaining groups, either singly or jointly, to ensure that any anticompetitive activities are in conformity with and within the scope of the legislative mandate of 18 V.S.A. § 9409 authorizing the creation and activities of provider bargaining groups.

(D) This rule shall not be construed as requiring the Authority to accept the position of any provider bargaining group. In addition, as stated in § 6.501(D)(3) of this rule, the Board has the discretion to reject any recommendation or decision of an arbitration panel called upon to assist the Board and provider bargaining groups to resolve disputes among them.

(E) If a contract for provider reimbursement is negotiated between the Authority and a provider bargaining group or between the purchasing pool and a provider bargaining group, the contract shall not take effect unless approved by the Board upon a finding that it is consistent with the unified health care budget and the health resource management plan adopted under 18 V.S.A. § 9405 and that the contract is consistent with the public good of the state of Vermont.

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