Text of RI S 346 (2025)

2025 -- S 0346 ======== LC000271 ======== S T A T E O F R H O D E I S L A N D IN GENERAL ASSEMBLY JANUARY SESSION, A.D. 2025 ____________ A N A C T RELATING TO HEALTH AND SAFETY -- THE RHODE ISLAND COMPREHENSIVE HEALTH INSURANCE PROGRAM Introduced By: Senators Bell, Ujifusa, Murray, Valverde, Lawson, DiMario, Mack, Euer, Quezada, and Kallman Date Introduced: February 21, 2025 Referred To: Senate Health & Human Services It is enacted by the General Assembly as follows: SECTION 1. Title 23 of the General Laws entitled "HEALTH AND SAFETY" is hereby 1 amended by adding thereto the following chapter: 2 CHAPTER 104 3 THE RHODE ISLAND COMPREHENSIVE HEALTH INSURANCE PROGRAM 4 23-104-1. Legislative findings. 5 (1) Health care is a human right, not a commodity available only to those who can afford 6 it; 7 (2) Although the federal Affordable Care Act (ACA) allowed states to offer more people 8 taxpayer subsidized private health insurance, the ACA has not provided universal, comprehensive, 9 affordable coverage for all Rhode Islanders: 10 (i) In 2019, about four and three-tenths percent (4.3%) of Rhode Islanders had no health 11 insurance, causing about forty-three (43) (1 per 1,000 uninsured) unnecessary deaths each year; 12 (ii) An estimated forty-five percent (45%) of Rhode Islanders are under-insured (e.g., not 13 seeking health care because of high deductibles and co-pays); 14 (3) COVID-19 exacerbated and highlighted problems with the status quo health insurance 15 system including: 16 (i) Coverage is too easily lost when health insurance is tied to jobs - between February and 17 May, 2020, about twenty-one thousand (21,000) more Rhode Islanders lost their jobs and their 18 LC000271 - Page 2 of 93 health insurance; 1 (ii) Systemic racism is reinforced - Black and Hispanic/Latinx Rhode Islanders, are more 2 likely to be uninsured or underinsured, have suffered the highest rates of COVID-19 mortality and 3 morbidity; 4 (iii) The fear of out-of-pocket costs for uninsured and underinsured puts everyone at risk 5 because they avoid testing and treatment; 6 (4) In 2016, sixty million (60,000,000) people separated from their job at some point during 7 the year (i.e., about forty-two percent (42%) of the American workforce) and although this act may 8 cause some job loss, on balance, single payer would increase employment in Rhode Island by nearly 9 three percent (3%); 10 (5) The existing US health insurance system has failed to control the cost of health care 11 and to provide universal access to health care in a system which is widely accepted to waste thirty 12 percent (30%) of its revenues on activities that do not improve the health of Americans; 13 (6) Every industrialized nation in the world, except the United States, offers universal 14 health care to its citizens and enjoys better health outcomes for less than two thirds (2/3) to one- 15 half (1/2) the cost; 16 (7) Health care is rationed under our current multi-payer system, despite the fact that Rhode 17 Island patients, businesses and taxpayers already pay enough to have comprehensive and universal 18 health insurance under a single-payer system; 19 (8) About one-third (1/3) of every "healthcare" dollar spent in the U.S. is wasted on 20 unnecessary administrative costs and excessive pharmaceutical company profits due to laws 21 preventing Medicare from negotiating prices and private health insurance companies lacking 22 adequate market share to effectively negotiate prices; 23 (9) Private health insurance companies are incentivized to let the cost of health care rise 24 because higher costs require health insurance companies to charge higher health insurance 25 premiums, increasing companies' revenue and stock price; 26 (10) The healthcare marketplace is not an efficient market and because it represents only 27 eighteen percent (18%) of the US domestic market, significantly restricts economic growth and 28 thus the financial well-being of every American, including every Rhode Islander; 29 (11) Rhode Islanders cannot afford to keep the current multi-payer health insurance system: 30 (i) Between 1991 and 2014, healthcare spending in Rhode Island per person rose by over 31 two hundred fifty percent (250%) rising much faster than income and greatly reducing disposable 32 income; 33 (ii) It is estimated that by 2025, the cost of health insurance for an average family of four 34 LC000271 - Page 3 of 93 (4) will equal about one-half (1/2) of their annual income; 1 (iii) In the U.S., about two-thirds (2/3) of personal bankruptcies are medical cost-related 2 and of these, about three-fourths (3/4) had health insurance at the onset of their medical problems. 3 In no other industrialized country do people worry about going bankrupt over medical costs; 4 (12) Rhode Island private businesses bear most of the costs of employee health insurance 5 coverage and spend significant time and money choosing from a confusing array of increasingly 6 expensive plans which do not provide comprehensive coverage; 7 (13) Rhode Island employees and retirees lose significant wages and pensions as they are 8 forced to pay higher amounts of health insurance and healthcare costs; 9 (14) Rhode Island's hospitals are under increasing financial distress i.e., closing, sold to 10 out-of-state entities, attempting mergers largely due to health insurance reimbursement problems 11 that other nations do not face and are fixed by a single-payer system; 12 (15) The state and its municipalities face enormous other post-employment benefits 13 (OPEB) unfunded liabilities due mostly to health insurance costs; 14 (16) An improved Medicare-for-all style single-payer program would, based on the 15 performance of existing Medicare, eliminate fifty percent (50%) of the administrative waste in the 16 current system of private insurance before other savings achieved through meaningful negotiation 17 of prices and other savings are considered; 18 (17) The high costs of medical care could be lowered significantly if the state could 19 negotiate on behalf of all its residents for bulk purchasing, as well as gain access to usage and price 20 information currently kept confidential by private health insurers as "proprietary information;" 21 (18) Single payer health care would establish a true "free market" system where doctors 22 compete for patients rather than health insurance companies dictating which patients are able to see 23 which doctors and setting reimbursement rates; 24 (19) Healthcare providers would spend significantly less time with administrative work 25 caused by multiple health insurance company requirements and barriers to care delivery and would 26 spend significantly less for overhead costs because of streamlined billing; 27 (20) Rhode Island must act because there are currently no effective state or federal laws 28 that can provide universal coverage and adequately control rising premiums, co-pays, deductibles 29 and medical costs, or prevent private insurance companies from continuing to limit available 30 providers and coverage; 31 (21) In 1962, Canada's successful single-payer program began in the province of 32 Saskatchewan (with approximately the same population as Rhode Island) and became a national 33 program within ten (10) years; and 34 LC000271 - Page 4 of 93 (22) The proposed Rhode Island single payer program was studied by Professor Gerald 1 Friedman at UMass Amherst in 2015 and he concluded that: 2 "Single-payer in Rhode Island will finance medical care with substantial savings compared 3 with the existing multi-payer system of public and private insurers and would improve access to 4 health care by extending coverage to the four percent (4%) of Rhode Island residents still without 5 insurance under the Affordable Care Act and expanding coverage for the growing number with 6 inadequate healthcare coverage. Single-payer would improve the economic health of Rhode Island 7 by: increasing real disposable income for most residents; reducing the burden of health care on 8 businesses and promoting increased employment; and shifting the costs of health care away from 9 working and middle-class residents." 10 23-104-2. Legislative purpose. 11 It is the intent of the general assembly that this chapter establish a universal, 12 comprehensive, affordable single-payer healthcare insurance program that will help control 13 healthcare costs which shall be referred to as, "the Rhode Island comprehensive health insurance 14 program" (RICHIP). The program will be paid for by consolidating government and private 15 payments to multiple insurance carriers into a more economical and efficient improved Medicare- 16 for-all style single-payer program and substituting lower progressive taxes for higher health 17 insurance premiums, co-pays, deductibles and costs in excess of caps. This program will save 18 Rhode Islanders from the current overly expensive, inefficient and unsustainable multi-payer health 19 insurance system that unnecessarily prevents access to medically necessary health care. The 20 program will be established after the standard of care funded by Medicaid has been raised to a 21 Medicare standard. 22 23-104-3. Definitions. 23 As used in this chapter: 24 (1) "Affordable Care Act" or "ACA" means the Federal Patient Protection and Affordable 25 Care Act (Pub. L. 111-148), as amended by the Federal Health Care and Education Reconciliation 26 Act of 2010 (Pub. L. 111-152), and any amendments to, or regulations or guidance issued under, 27 those acts. 28 (2) "Carrier" means either a private health insurer authorized to sell health insurance in 29 Rhode Island or a healthcare service plan, i.e., any person who undertakes to arrange for the 30 provision of healthcare services to subscribers or enrollees, or to pay for or to reimburse any part 31 of the cost for those services, in return for a prepaid or periodic charge paid by or on behalf of the 32 subscribers or enrollees, or any person, whether located within or outside of this state, who solicits 33 or contracts with a subscriber or enrollee in this state to pay for or reimburse any part of the cost 34 LC000271 - Page 5 of 93 of, or who undertakes to arrange or arranges for, the provision of healthcare services that are to be 1 provided, wholly or in part, in a foreign country in return for a prepaid or periodic charge paid by 2 or on behalf of the subscriber or enrollee. 3 (3) "Dependent" has the same definition as set forth in federal tax law (26 U.S.C. § 152). 4 (4) "Emergency and urgently needed services" has the same definition as set forth in the 5 federal Medicare law (42 CFR 422.113). 6 (5) "Federally matched public health program" means the state's Medicaid program under 7 Title XIX of the Social Security Act (42 U.S.C. Sec. 1396 et seq.) and the state's Children's Health 8 Insurance Program (CHIP) under Title XXI of the Social Security Act (42 U.S.C. Sec. 1397aa et 9 seq.). 10 (6) "For-profit provider" means any healthcare professional or healthcare institution that 11 provides payments, profits or dividends to investors or owners who do not directly provide health 12 care. 13 (7) "Health insurance" means any entity subject to the insurance laws and regulations of 14 this state, or subject to the jurisdiction of the health insurance commissioner, that contracts or offers 15 to contract, to provide and/or insuring health services on a prepaid basis, including, but not limited 16 to, policies of accident and sickness insurance, as defined by chapter 18 of title 27, nonprofit 17 hospital service corporation as defined by chapter 19 of title 27, and nonprofit medical service 18 corporation as defined in chapter 20 of title 27, a health maintenance organizations, as defined in 19 chapter 41 of title 27 and also includes a nonprofit dental service corporation, as defined in chapter 20 20.1 of title 27, all nonprofit optometric service corporations, as defined in chapter 20.2 of title 27, 21 a domestic insurance company subject to chapter 1 of title 27 that offers or provides health 22 insurance coverage in the state, and a foreign insurance company, subject to chapter 2 of title 27, 23 all pharmacy benefit managers (PBMs) that contracts to administer or manage prescription drug 24 benefits, any plan preempted by ERISA, but subject to state control (specifically state government, 25 local government, and quasi-public agency ERISA plans). 26 (8) "Medicaid" or "medical assistance" means a program that is one of the following: 27 (i) The state's Medicaid program under Title XIX of the Social Security Act (42 U.S.C. 28 Sec. 1396 et seq.); or 29 (ii) The state's Children's Health Insurance Program under Title XXI of the Social Security 30 Act (42 U.S.C. Sec. 1397aa et seq.). 31 (9) "Medically necessary" means medical, surgical or other services or goods (including 32 prescription drugs) required for the prevention, diagnosis, cure, or treatment of a health-related 33 condition including any such services that are necessary to prevent a detrimental change in either 34 LC000271 - Page 6 of 93 medical or mental health status. Medically necessary services shall be provided in a cost-effective 1 and appropriate setting and shall not be provided solely for the convenience of the patient or service 2 provider. "Medically necessary" does not include services or goods that are primarily for cosmetic 3 purposes; and does not include services or goods that are experimental, unless approved pursuant 4 to § 23-104-6(b). 5 (10) "Medicare" means Title XVIII of the Social Security Act (42 U.S.C. Sec. 1395 et seq.) 6 and the programs thereunder. 7 (11) "Qualified healthcare provider" means any individual who meets requirements set 8 forth in § 23-104-7(a)(1). 9 (12) "Qualified Rhode Island resident" means any individual who is a "resident" as defined 10 by §§ 44-30-5(a)(1) and (a)(2) or a dependent of that resident. 11 (13) "Rhode Island comprehensive health insurance program" or ("RICHIP") means the 12 affordable, comprehensive and effective health insurance program as set forth in this chapter. 13 (14) "RICHIP participant" means a qualified Rhode Island resident who is enrolled in 14 RICHIP (and not disenrolled or disqualified) at the time they seek health care. 15 23-104-4. Rhode Island health insurance program. 16 (a) Organization. This chapter creates the Rhode Island comprehensive health insurance 17 program (RICHIP), as an independent state government agency. 18 (b) Director. A director shall be appointed by the governor, with the advice and consent of 19 the senate, to lead RICHIP and serve a term of four (4) years, subject to oversight by an executive 20 board. The director shall be compensated in accordance with the job title and job classification 21 established by the division of human resources and approved by the general assembly. The duties 22 of the director shall include: 23 (1) Employ staff and authorize reasonable expenditures, as necessary, from the RICHIP 24 trust fund, to pay program expenses and to administer the program, including creation and oversight 25 of RICHIP budgets; 26 (2) Oversee management of the RICHIP trust fund set forth in § 23-104-12(a) to ensure the 27 operational well-being and fiscal solvency of the program, including ensuring that all available 28 funds from all appropriate sources are collected and placed into the trust fund; 29 (3) Take any actions necessary and proper to implement the provisions of this chapter; 30 (4) Implement standardized claims and reporting procedures; 31 (5) Provide for timely payments to participating providers through a structure that is well 32 organized and that eliminates unnecessary administrative costs, i.e., coordinate with the state 33 comptroller to facilitate billing from and payments to providers using the state's computerized 34 LC000271 - Page 7 of 93 financial system, the Rhode Island financial and accounting network system (RIFANS); 1 (6) Coordinate with federal healthcare programs, including Medicare and Medicaid, to 2 obtain necessary waivers and streamline federal funding and reimbursement; 3 (7) Monitor billing and reimbursements to detect inappropriate behavior by providers and 4 patients and create prohibitions and penalties regarding bad faith or criminal RICHIP participation, 5 and procedures by which they will be enforced; 6 (8) Support the development of an integrated healthcare database for healthcare planning 7 and quality assurance and ensure the legally required confidentiality of all health records it 8 contains; 9 (9) Determine eligibility for RICHIP and establish procedures for enrollment, 10 disenrollment and disqualification from RICHIP, as well as procedures for handling complaints 11 and appeals from affected individuals, as set forth in § 29-104-5; 12 (10) Create RICHIP expenditure, status, and assessment reports, including, but not limited 13 to, annual reports with the following: 14 (i) Performance of the program; 15 (ii) Fiscal condition of the program; 16 (iii) Recommendations for statutory changes; 17 (iv) Receipt of payments from the federal government; 18 (v) Whether current year goals and priorities were met; and 19 (vi) Future goals and priorities; 20 (11) Review RICHIP collections and disbursements on at least a quarterly basis and 21 recommend adjustments needed to achieve budgetary targets and permit adequate access to care; 22 (12) Develop procedures for accommodating: 23 (i) Employer retiree health benefits for people who have been members of RICHIP but go 24 to live as retirees out of the state; 25 (ii) Employer retiree health benefits for people who earned or accrued those benefits while 26 residing in the state prior to the implementation of RICHIP and live as retirees out of the state; and 27 (iii) RICHIP coverage of healthcare services currently covered under the workers' 28 compensation system, including whether and how to continue funding for those services under that 29 system and whether and how to incorporate an element of experience rating; and 30 (13) No later than two (2) years after the effective date of this chapter, develop a proposal, 31 consistent with the principles of this chapter, for provision and funding by the program of long- 32 term care coverage. 33 (c) Board. There shall be a RICHIP board composed of nine (9) members serving terms of 34 LC000271 - Page 8 of 93 four (4) years. Members shall be appointed by the governor with advice and consent of the senate. 1 Members of the board shall have no pecuniary interest in any health insurance company or any 2 business subject to regulation of the board and cannot have previously worked for a health 3 insurance company. The duties of the board shall include: 4 (1) Annually establish a RICHIP benefits package for participants, including a formulary 5 and a list of other medically necessary goods, as well as a procedure for handling complaints and 6 appeals relating to the benefits package, pursuant to § 23-104-6. 7 (2) Establish RICHIP provider reimbursement and a procedure for handling provider 8 complaints and appeals as set forth in § 23-104-9; 9 (3) Review budget proposals from providers pursuant to § 23-104-11(b); and 10 (4) The board shall be subject to chapter 46 of title 42 ("open meetings"). 11 23-104-5. Coverage. 12 (a) All qualified Rhode Island residents may participate in RICHIP. The director shall 13 establish procedures to determine eligibility, enrollment, disenrollment and disqualification, 14 including criteria and procedures by which RICHIP can: 15 (1) Identify, automatically enroll, and provide a RICHIP card to qualified Rhode Island 16 residents; 17 (2) Process applications from individuals seeking to obtain RICHIP coverage for 18 dependents after the implementation date; 19 (3) Ensure eligible residents are knowledgeable and aware of their rights to health care; 20 (4) Determine whether an individual should be disenrolled (e.g., for leaving the state); 21 (5) Determine whether an individual should be disqualified (e.g., for fraudulent receipt of 22 benefits or reimbursements); 23 (6) Determine appropriate actions that should be taken with respect to individuals who are 24 disenrolled or disqualified (including civil and criminal penalties); and 25 (7) Permit individuals to request review and appeal decisions to disenroll or disqualify 26 them. 27 (b) Medicare and Medicaid eligible coverage under RICHIP shall be as follows: 28 (1) If all necessary federal waivers are obtained, qualified Rhode Island residents eligible 29 for federal Medicare ("Medicare eligible residents") shall continue to pay required fees to the 30 federal government. RICHIP shall establish procedures to ensure that Medicare eligible residents 31 shall have such amounts deducted from what they owe to RICHIP under § 23-104-12(h). RICHIP 32 shall become the equivalent of qualifying coverage under Medicare part D and Medicare advantage 33 programs, and as such shall be the vendor for coverage to RICHIP participants. RICHIP shall 34 LC000271 - Page 9 of 93 provide Medicare eligible residents benefits equal to those available to all other RICHIP 1 participants and equal to or greater than those available through the federal Medicare program. To 2 streamline the process, RICHIP shall seek to receive federal reimbursements for services and goods 3 to Medicare eligible residents and administer all Medicare funds. 4 (2) If all necessary federal waivers are obtained, RICHIP shall become the state's sole 5 Medicaid provider. RICHIP shall create procedures to enroll all qualified Rhode Island residents 6 eligible for Medicaid ("Medicaid eligible residents") in the federal Medicaid program to ensure a 7 maximum amount of federal Medicaid funds go to the RICHIP trust fund. RICHIP shall provide 8 benefits to Medicaid eligible residents equal to those available to all other RICHIP participants. 9 (3) If all necessary federal waivers are not granted from the Medicaid or Medicare 10 programs operated under Title XVIII or XIX of the Social Security Act, the Medicaid or Medicare 11 program for which a waiver is not granted shall act as the primary insurer for those eligible for such 12 coverage, and RICHIP shall serve as the secondary or supplemental plan of health insurance 13 coverage. Until such time as a waiver is granted, the plan shall not pay for services for persons 14 otherwise eligible for the same healthcare benefits under the Medicaid or Medicare program. The 15 director shall establish procedures for determining amounts owed by Medicare and Medicaid 16 eligible residents for supplemental RICHIP coverage and the extent of such coverage. 17 (4) The director may require Rhode Island residents to provide information necessary to 18 determine whether the resident is eligible for a federally matched public health program or for 19 Medicare, or any program or benefit under Medicare. 20 (5) As a condition of eligibility or continued eligibility for healthcare services under 21 RICHIP, a qualified Rhode Island resident who is eligible for benefits under Medicare shall enroll 22 in Medicare, including Parts A, B, and D. 23 (c) Veterans. RICHIP shall serve as the secondary or supplemental plan of health insurance 24 coverage for military veterans. The director shall establish procedures for determining amounts 25 owed by military veterans who are qualified residents for such supplemental RICHIP coverage and 26 the extent of such coverage. 27 (d) This chapter does not create any employment benefit, nor require, prohibit, or limit the 28 providing of any employment benefit. 29 (e) This chapter does not affect or limit collective action or collective bargaining on the 30 part of a healthcare provider with their employer or any other lawful collective action or collective 31 bargaining. 32 23-104-6. Benefits. 33 (a) This chapter shall provide insurance coverage for services and goods (including 34 LC000271 - Page 10 of 93 prescription drugs) deemed medically necessary by a qualified healthcare provider and that is 1 currently covered under: 2 (1) Services and goods currently covered by the federal Medicare program (Social Security 3 Act title XVIII) parts A, B and D; 4 (2) Services and goods covered by Medicaid as of January 1, 2026; 5 (3) Services and goods currently covered by the state's Children's Health Insurance 6 Program; 7 (4) Essential health benefits mandated by the Affordable Care Act; and 8 (5) Services and goods within the following categories: 9 (i) Primary and preventive care; 10 (ii) Approved dietary and nutritional therapies; 11 (iii) Inpatient care; 12 (iv) Outpatient care; 13 (v) Emergency and urgently needed care; 14 (vi) Prescription drugs and medical devices; 15 (vii) Laboratory and diagnostic services; 16 (viii) Palliative care; 17 (ix) Mental health services; 18 (x) Oral health, including dental services, periodontics, oral surgery, and endodontics; 19 (xi) Substance abuse treatment services; 20 (xii) Physical therapy and chiropractic services; 21 (xiii) Vision care and vision correction; 22 (xiv) Hearing services, including coverage of hearing aids; 23 (xv) Podiatric care; 24 (xvi) Comprehensive family planning, reproductive, maternity, and newborn care; 25 (xvii) Short-term rehabilitative services and devices; 26 (xviii) Durable medical equipment; 27 (xix) Gender affirming health care; and 28 (xx) Diagnostic and routine medical testing. 29 (b) Additional coverage. The director shall create a procedure that may permit additional 30 medically necessary goods and services beyond that provided by federal laws cited herein and 31 within the areas set forth in § 23-104-5, if the coverage is for services and goods deemed medically 32 necessary based on credible scientific evidence published in peer-reviewed medical literature 33 generally recognized by the relevant medical community, physician specialty society 34 LC000271 - Page 11 of 93 recommendations, and the views of physicians practicing in relevant clinical areas and any other 1 relevant factors. The director shall create procedures for handling complaints and appeals 2 concerning the benefits package. 3 (c) Restrictions shall not apply. In order for RICHIP participants to be able to receive 4 medically necessary goods and services, this chapter shall override any state law that restricts the 5 provision or use of state funds for any medically necessary goods or services, including those 6 related to family planning and reproductive healthcare. 7 (d) Medically necessary goods: 8 (1) Prescription drug formulary: 9 (i) In general. The director shall establish a prescription drug formulary system, to be 10 approved by the board, and encourage best-practices in prescribing and discourage the use of 11 ineffective, dangerous, or excessively costly medications when better alternatives are available. 12 (ii) Promotion of generics. The formulary under this subsection shall promote the use of 13 generic medications to the greatest extent possible. 14 (iii) Formulary updates and petition rights. The formulary under this subsection shall be 15 updated frequently and the director shall create a procedure for patients and providers to make 16 requests and appeal denials to add new pharmaceuticals or to remove ineffective or dangerous 17 medications from the formulary. 18 (iv) Use of off-formulary medications. The director shall promulgate rules regarding the 19 use of off-formulary medications which allow for patient access but do not compromise the 20 formulary. 21 (v) Approved devices and equipment. The director shall present a list of medically 22 necessary devices and equipment that shall be covered by RICHIP, subject to final approval by the 23 board. 24 (vi) Bulk purchasing. The director shall seek and implement ways to obtain goods at the 25 lowest possible cost, including bulk purchasing agreements. 26 23-104-7. Providers. 27 (a) Rhode Island providers. 28 (1) Licensing. Participating providers shall meet state licensing requirements in order to 29 participate in RICHIP. No provider whose license is under suspension or has been revoked shall 30 participate in the program. 31 (2) Participation. All providers may participate in RICHIP by providing items on the 32 RICHIP benefits list for which they are licensed. Providers may elect either to participate fully, or 33 not at all, in the program. 34 LC000271 - Page 12 of 93 (3) For-profit providers. For-profit providers may continue to offer services and goods in 1 Rhode Island, but are prohibited from charging patients more than RICHIP reimbursement rates 2 for covered services and goods and shall notify qualified Rhode Island residents when the services 3 and goods they offer will not be reimbursed fully under RICHIP. 4 (b) Out-of-state providers. Except for emergency and urgently needed service, as set forth 5 in § 23-104-7(d), RICHIP shall not pay for healthcare services obtained outside of Rhode Island 6 unless the following requirements are met: 7 (1) The out-of-state provider agrees to accept the RICHIP rate for out-of-state providers; 8 and 9 (2) The services are medically necessary care. 10 (c) Out-of-state provider reimbursement. The program shall pay out-of-state healthcare 11 providers at a rate equal to the average rate paid by commercial insurers or Medicare for the services 12 rendered, whichever is higher. 13 (d) Out-of-state residents. 14 (1) In general. Rhode Island providers who provide any services to individuals who are not 15 RICHIP participants shall not be reimbursed by RICHIP and shall seek reimbursement from those 16 individuals or other sources. 17 (2) Emergency care exception. Nothing in this chapter shall prevent any individual from 18 receiving or any provider from providing emergency healthcare services and goods in Rhode 19 Island. The director shall adopt rules to provide reimbursement; however, the rules shall reasonably 20 limit reimbursement to protect the fiscal integrity of RICHIP. The director shall implement 21 procedures to secure reimbursement from any appropriate third-party funding source or from the 22 individual to whom the emergency services were rendered. 23 23-104-8. Cross border employees. 24 (a) State residents employed out-of-state. If an individual is employed out-of-state by an 25 employer that is subject to Rhode Island state law, the employer and employee shall be required to 26 pay the payroll taxes as to that employee as if the employment were in the state. If an individual is 27 employed out-of-state by an employer that is not subject to Rhode Island state law, the employee 28 health coverage provided by the out-of-state employer to a resident working out-of-state shall serve 29 as the employee's primary plan of health coverage, and RICHIP shall serve as the employee's 30 secondary plan of health coverage. The director shall establish procedures for determining amounts 31 owed by residents employed out-of-state for such supplemental secondary RICHIP coverage and 32 the extent of such coverage. 33 (b) Out-of-state residents employed in the state. The payroll tax set forth in § 23-104-12(i) 34 LC000271 - Page 13 of 93 shall apply to any out-of-state resident who is employed or self-employed in the state. However, 1 such out-of-state residents shall be able to take a credit for amounts they spend on health benefits 2 for themselves that would otherwise be covered by RICHIP if the individual were a RICHIP 3 participant. The out-of-state resident's employer shall be able to take a credit against such payroll 4 taxes regardless of the form of the health benefit (e.g., health insurance, a self-insured plan, direct 5 services, or reimbursement for services), to ensure that the revenue proposal does not relate to 6 employment benefits in violation of the Federal Employee Retirement Income Security Act 7 ("ERISA") law. For non-employment-based spending by individuals, the credit shall be available 8 for and limited to spending for health coverage (not out-of-pocket health spending). The credit shall 9 be available without regard to how little is spent or how sparse the benefit. The credit may only be 10 taken against the payroll taxes set forth in § 23-104-12(i). Any excess amount may not be applied 11 to other tax liability. For employment-based health benefits, the credit shall be distributed between 12 the employer and employee in the same proportion as the spending by each for the benefit. The 13 employer and employee may each apply their respective portion of the credit to their respective 14 portion of the payroll taxes set forth in § 23-104-12(i). If any provision of this clause or any 15 application of it shall be ruled to violate ERISA, the provision or the application of it shall be null 16 and void and the ruling shall not affect any other provision or application of this section or this 17 chapter. 18 23-104-9. Provider reimbursement. 19 (a) Rates for services and goods. RICHIP reimbursement rates to providers shall be 20 determined by the RICHIP board. These rates shall be equal to or greater than the federal Medicare 21 rates available to Rhode Island qualified residents that are in effect at the time services and goods 22 are provided. For outpatient behavioral health services, the minimum rate shall equal one hundred 23 fifty percent (150%) of federal Medicare rates. If the director determines that there are no such 24 federal Medicare reimbursement rates, the director shall set the minimum rate. The director shall 25 review the rates at least annually, recommend changes to the board, and establish procedures by 26 which complaints about reimbursement rates may be reviewed by the board. 27 (b) Billing and payments. Providers shall submit billing for services to RICHIP participants 28 in the form of electronic invoices entered into RIFANS, the state's computerized financial system. 29 The director shall coordinate the manner of processing and payment with the office of accounts and 30 control and the RIFANS support team within the division of information technology. Payments 31 shall be made by check or electronic funds transfer in accordance with terms and procedures 32 coordinated by the director and the office of accounts and control and consistent with the fiduciary 33 management of the RICHIP trust fund. 34 LC000271 - Page 14 of 93 (c) Provider restrictions. In-state providers who accept any payment from RICHIP shall 1 not bill any patient for any covered benefit. In-state providers cannot use any of their operating 2 budgets for expansion, profit, excessive executive income, including bonuses, marketing, or major 3 capital purchases or leases. 4 23-104-10. Private insurance companies. 5 (a) Non-duplication. It is unlawful for a private health insurer to sell health insurance 6 coverage to qualified Rhode Island residents that duplicates the benefits provided under this 7 chapter. Nothing in this chapter shall be construed as prohibiting the sale of health insurance 8 coverage for any additional benefits not covered by this chapter, including additional benefits that 9 an employer may provide to employees or their dependents, or to former employees or their 10 dependents (e.g., multiemployer plans can continue to provide wrap-around coverage for any 11 benefits not provided by RICHIP). 12 (b) Displaced employees. Re-education and job placement of persons employed in Rhode 13 Island-located enterprises who have lost their jobs as a result of this chapter shall be managed by 14 the Rhode Island department of labor and training or an appropriate federal retraining program. The 15 director may provide funds from RICHIP or funds otherwise appropriated for this purpose for 16 retraining and assisting job transition for individuals employed or previously employed in the fields 17 of health insurance, healthcare service plans, and other third-party payments for health care or those 18 individuals providing services to healthcare providers to deal with third-party payers for health 19 care, whose jobs may be or have been ended as a result of the implementation of the program, 20 consistent with applicable laws. 21 23-104-11. Budgeting. 22 (a) Operating budget. Annually, the director shall create an operating budget for the 23 program that includes the costs for all benefits set forth in § 23-104-5 and the costs for RICHIP 24 administration. The director shall determine appropriate reimbursement rates for benefits pursuant 25 to § 23-104-9(a). The operating budget shall be approved by the executive board prior to 26 submission to the governor and general assembly. 27 (b) Capital expenditures. The director shall work with representatives from state entities 28 involved with provider capital expenditures (e.g., the Rhode Island department of administration 29 office of capital projects, the Rhode Island health and educational building corporation, etc.), and 30 providers to help ensure that capital expenditures proposed by providers, including amounts to be 31 spent on construction and renovation of health facilities and major equipment purchases, will 32 address healthcare needs of RICHIP participants. To the extent that providers are seeking to use 33 RICHIP funds for capital expenditures, the director shall have the authority to approve or deny such 34 LC000271 - Page 15 of 93 expenditures. 1 (c) Prohibition against co-mingling operations and capital improvement funds. It is 2 prohibited to use funds under this chapter that are earmarked: 3 (1) For operations for capital expenditures; or 4 (2) For capital expenditures for operations. 5 23-104-12. Financing. 6 (a) RICHIP trust fund. There shall be established a RICHIP trust fund into which funds 7 collected pursuant to this chapter are deposited and from which funds are distributed. All money 8 collected and received shall be used exclusively to finance RICHIP. The governor or general 9 assembly may provide funds to the RICHIP trust fund, but may not remove or borrow funds from 10 the RICHIP trust fund. 11 (b) Revenue proposal. After approval of the RICHIP executive board, the director shall 12 submit to the governor and the general assembly a revenue plan and, if required, legislation 13 (referred to collectively in this section as the "revenue proposal") to provide the revenue necessary 14 to finance RICHIP. The initial revenue proposal shall be submitted once waiver negotiations have 15 proceeded to a level deemed sufficient by the director and annually, thereafter. The basic structure 16 of the initial revenue proposal will be based on a consideration of: 17 (1) Anticipated savings from a single payer program; 18 (2) Government funds available for health care; 19 (3) Private funds available for health care; and 20 (4) Replacing current regressive health insurance payments made to multiple health 21 insurance carriers with progressive contributions to a single payer (RICHIP) in order to make 22 healthcare insurance affordable and remove unnecessary barriers to healthcare access. 23 Subsequent proposals shall adjust the RICHIP contributions, based on projections from the 24 total RICHIP costs in the previous year, and shall include a five (5) year plan for adjusting RICHIP 25 contributions to best meet the goals set forth in this section and § 23-104-2. 26 (c) Anticipated savings. It is anticipated that RICHIP will lower healthcare costs by: 27 (1) Eliminating payments to private health insurance carriers; 28 (2) Reducing paperwork and administrative expenses for both providers and payers created 29 by the marketing, sales, eligibility checks, network contract management, issues associated 30 multiple benefit packages, and other administrative waste associated with the current multi-payer 31 private health insurance system; 32 (3) Allowing the planning and delivery of a public health strategy for the entire population 33 of Rhode Island; 34 LC000271 - Page 16 of 93 (4) Improving access to preventive healthcare; and 1 (5) Negotiating on behalf of the state for bulk purchasing of medical supplies and 2 pharmaceuticals. 3 (d) Federal funds. The executive office of health and human services, in collaboration with 4 the director, the board and the Medicaid office, shall seek and obtain waivers and other approvals 5 relating to Medicaid, the Children's Health Insurance Program, Medicare, federal tax exemptions 6 for health care, the ACA, and any other relevant federal programs in order that: 7 (1) Federal funds and other subsidies for health care that would otherwise be paid to the 8 state and its residents and healthcare providers, would be paid by the federal government to the 9 state and deposited into the RICHIP trust fund; 10 (2) Programs would be waived and such funding from federal programs in Rhode Island 11 would be replaced or merged into RICHIP in order that it can operate as a single payer program; 12 (3) Maximum federal funding for health care is sought even if any necessary waivers or 13 approvals are not obtained and multiple sources of funding with RICHIP trust fund monies are 14 pooled, in order that RICHIP can act as much as possible like a single payer program to maximize 15 benefits to Rhode Islanders; and 16 (4) Federal financial participation in the programs that are incorporated into RICHIP are 17 not jeopardized. 18 (e) State funds. State funds that would otherwise be appropriated to any governmental 19 agency, office, program, instrumentality, or institution for services and benefits covered under 20 RICHIP shall be directed into the RICHIP trust fund. Payments to the fund pursuant to this section 21 shall be in an amount equal to the money appropriated for those purposes in the fiscal year 22 beginning immediately preceding the effective date of this chapter. 23 (f) Private funds. Private grants (e.g., from nonprofit corporations) and other funds 24 specifically ear-marked for health care (e.g., from litigation against tobacco companies, opioid 25 manufacturers, etc.), shall also be put into the RICHIP trust fund. 26 (g) Assignments from RICHIP participants. Receipt of healthcare services under the plan 27 shall be deemed an assignment by the RICHIP participant of any right to payment for services from 28 a policy of insurance, a health benefit plan or other source. The other source of healthcare benefits 29 shall pay to the fund all amounts it is obligated to pay to, or on behalf of, the RICHIP participant 30 for covered healthcare services. The director may commence any action necessary to recover the 31 amounts due. 32 (h) Replacing current health insurance payments with progressive contributions. Instead of 33 making health insurance payments to multiple carriers (i.e., for premiums, co-pays deductibles, and 34 LC000271 - Page 17 of 93 costs in excess of caps) for limited coverage, individuals and entities subject to Rhode Island 1 taxation pursuant to § 44-30-1 shall pay progressive contributions to the RICHIP trust fund 2 (referred to collectively in this section as the "RICHIP contributions") for comprehensive coverage. 3 These RICHIP contributions shall be set and adjusted over time to an appropriate level to: 4 (1) Cover the actual cost of the program; 5 (2) Ensure that higher brackets of income subject to specified taxes shall be assessed at a 6 higher marginal rate than lower brackets; and 7 (3) Protect the economic welfare of small businesses, low-income earners and working 8 families through tax credits or exemptions. 9 (i) Contributions based on earned income. The amounts currently paid by employers and 10 employees for health insurance shall initially be replaced by a ten percent (10%) payroll tax, based 11 on the projected average payroll of employees over three (3) previous calendar years. The employer 12 shall pay eighty percent (80%) and the employee shall pay twenty percent (20%) of this payroll 13 tax, except that an employer may agree to pay all or part of the employee's share. Self- employed 14 individuals shall initially pay one-hundred percent (100%) of the payroll tax. The ten percent (10%) 15 initial rate will be adjusted by the director in order that higher brackets of income subject to these 16 taxes shall be assessed at a higher marginal rate than lower brackets and in order that small 17 businesses and lower income earners receive a credit or exemption. 18 (j) Contributions based on unearned income. There shall be a progressive contribution 19 based on unearned income, i.e., capital gains, dividends, interest, profits, and rents. Initially, the 20 unearned income RICHIP contributions shall be equal to ten percent (10%) of such unearned 21 income. The ten percent (10%) initial rate may be adjusted by the director to allow for a graduated 22 progressive exemption or credit for individuals with lower unearned income levels. 23 23-104-13. Implementation. 24 (a) State laws and regulations. 25 (1) In general. The director shall work with the executive board and receive such assistance 26 as may be necessary from other state agencies and entities to examine state laws and regulations 27 and to make recommendations necessary to conform such laws and regulations to properly 28 implement the RICHIP program. The director shall report recommendations to the governor and 29 the general assembly. 30 (2) Anti-trust laws. The intent of this chapter is to exempt activities provided for under this 31 chapter from state antitrust laws and to provide immunity from federal antitrust laws through the 32 state action doctrine. 33 (b) The director shall complete an implementation plan to provide healthcare coverage for 34 LC000271 - Page 18 of 93 qualified residents in accordance with this chapter within twelve (12) months of its effective date. 1 (c) The executive office of health and human services, in collaboration with the director, 2 the board, and the Medicaid director, will have the initial responsibility of negotiating the waivers. 3 (d) Severability. If any provision or application of this chapter shall be held to be invalid, 4 or to violate or be inconsistent with any applicable federal law or regulation, that shall not affect 5 other provisions or applications of this chapter which can be given effect without that provision or 6 application; and to that end, the provisions and applications of this chapter are severable. 7 SECTION 2. Chapter 22-11 of the General Laws entitled "Joint Committee on Legislative 8 Services" is hereby amended by adding thereto the following section: 9 22-11-4.1. Employees needed to maximize federal Medicaid funding. 10 The joint committee on legislative services shall fund five (5) new FTEs for the senate 11 fiscal office and five (5) new FTEs for the house fiscal office exclusively devoted to finding ways 12 to maximize federal Medicaid funding, including compiling proposals for expanding eligibility to 13 maximize the eligibility allowed by Centers for Medicare & Medicaid Services (CMS). 14 SECTION 3. Section 27-34.3-7 of the General Laws in Chapter 27-34.3 entitled "Rhode 15 Island Life and Health Insurance Guaranty Association Act" is hereby amended to read as follows: 16 27-34.3-7. Board of directors. 17 (a) The board of directors of the association shall consist of: 18 (1) Not less than five (5) nor more than nine (9) member insurers serving terms as 19 established in the plan of operation Nine (9) members appointed by the governor with advice and 20 consent of the senate; and 21 (2) The commissioner or the commissioner’s designee, who shall chair the board in a non- 22 voting ex officio capacity. Only member insurers shall be eligible to vote. The members of the 23 board shall be selected by member insurers subject to the approval of the commissioner. The board 24 of directors, previously established under § 27-34.1-8 [repealed], shall continue to operate in 25 accordance with the provision of this section. Vacancies on the board shall be filled for the 26 remaining period of the term by a majority vote of the remaining board members, subject to the 27 approval of the commissioner. 28 (b) In approving selections to the board, the commissioner shall consider, among other 29 things, whether all member insurers are fairly represented. 30 (c) Members of the board may be reimbursed from the assets of the association for expenses 31 incurred by them as members of the board of directors but members of the board shall not be 32 compensated by the association for their services. 33 SECTION 4. Section 27-66-24 of the General Laws in Chapter 27-66 entitled "The Health 34 LC000271 - Page 19 of 93 Insurance Conversions Act" is hereby amended to read as follows: 1 27-66-24. Exceptions — Rehabilitation, liquidation, or conservation. 2 No proposed conversion shall be subject to this chapter in In the event that the a health 3 insurance corporation, health maintenance corporation, a nonprofit hospital service corporation, 4 nonprofit medical service corporation, pharmacy benefit manager, nonprofit dental service 5 corporation, managed care organization, nonprofit optometric service corporation, or affiliate or 6 subsidiary of them, hereinafter "the insurer," is subject to an order from the superior court directing 7 the director to rehabilitate, liquidate, or conserve, as provided in §§ 27-19-28, 27-20-24, 27-41-18, 8 or chapter 14.1, 14.2, 14.3, or 14.4 of this title., certain additional conditions shall apply to the 9 insurer: 10 (1) The insolvency, financial condition, or default of the insurer at any time shall not permit 11 the insurer to fail to pay claims in a timely manner. 12 (2) Should the insurer fail to pay claims in a timely manner, those claims shall become a 13 temporary obligation of the state, who shall pay them in a timely manner. Should the state be 14 compelled to pay claims for this reason, the insurer shall owe the state a fine ten (10) times the 15 value of all claims paid. 16 (3) The insolvency, financial condition, or default of the insurer at any time shall not permit 17 the insurer to fail to pay state taxes on time. Should the insurer fail to pay taxes on time, the size of 18 the tax obligation owed shall increase by a factor of ten (10). 19 (4) The Medicaid office shall be guaranteed a right of first refusal to acquire the insurer 20 before alternate buyers are considered. Any obligations due to the state by the insurer shall be 21 counted towards the purchase price of the insurer. The Rhode Island life and health insurance 22 guaranty association, created pursuant to § 27-34.3-6, shall pay the costs of the acquisition, but all 23 ownership shares shall be held by the Medicaid office. 24 SECTION 5. Title 27 of the General Laws entitled "INSURANCE" is hereby amended by 25 adding thereto the following chapter: 26 CHAPTER 83 27 PRIOR AUTHORIZATION OF CERTAIN HEALTH INSURANCE POLICY CHANGES 28 27-83-1. Definitions. 29 For purposes of this chapter: 30 "Health insurer" means any entity subject to the insurance laws and regulations of this state, 31 or subject to the jurisdiction of the health insurance commissioner, that contracts or offers to 32 contract, to provide and/or insuring health services on a prepaid basis, including, but not limited to, 33 policies of accident and sickness insurance subject to chapter 18 of title 27; any nonprofit hospital 34 LC000271 - Page 20 of 93 service corporation subject to chapter 19 of title 27; any nonprofit medical service corporation 1 subject to chapter 20 of title 27; any health maintenance organization subject to chapter 41 of title 2 27; any nonprofit dental service corporation subject to chapter 20.1 of title 27; any nonprofit 3 optometric service corporation subject to chapter 20.2 of title 27; any pharmacy benefit manager; 4 or any health benefit plan issued by the State of Rhode Island, a municipality, a quasi-public 5 agency, or any other political subdivision of the State of Rhode Island to cover employees. 6 27-83-2. Prior authorization of general assembly. 7 (a) Prior authorization of the general assembly shall be required for certain policy changes 8 by health insurers: 9 (1) Any change that increases the average amount charged annually to consumers on a per 10 beneficiary basis; 11 (2) Any change that in any way reduces any benefits offered to plan beneficiaries; 12 (3) Any change that increases any premiums, deductibles, or copays; 13 (4) Ceasing offering any plan a health insurer offers within the State of Rhode Island; or 14 (5) Any other change that the health insurance commissioner or attorney general shall, 15 through regulation, determine to require prior authorization of the general assembly. 16 (b) No rate reviews pursuant to those utilized in §§ 27-18-54, 27-19-30.1, 27-20-25.2, 27- 17 41-27.2, and 42-62-13 shall be construed to exempt any health insurer from the prior authorization 18 requirements of this chapter. 19 SECTION 6. Section 28-57-5 of the General Laws in Chapter 28-57 entitled "Healthy and 20 Safe Families and Workplaces Act" is hereby amended to read as follows: 21 28-57-5. Accrual of paid sick and safe leave time. 22 (a) All employees employed by an employer of eighteen (18) or more employees in Rhode 23 Island shall accrue a minimum of one hour of paid sick and safe leave time for every thirty five 24 (35) hours worked up to a maximum of twenty-four (24) hours during calendar year 2018, thirty- 25 two (32) hours during calendar year 2019, and up to a maximum of forty (40) hours per year from 26 calendar year 2020 through calendar year 2026, and one hundred sixty (160) hours per year 27 thereafter, unless the employer chooses to provide a higher annual limit in both accrual and use. In 28 determining the number of employees who are employed by an employer for compensation, all 29 employees defined in § 28-57-3(7) shall be counted. 30 (b) Employees who are exempt from the overtime requirements under 29 U.S.C. § 31 213(a)(1) of the federal Fair Labor Standards Act, 29 U.S.C. § 201 et seq., will be assumed to work 32 forty (40) hours in each workweek for purposes of paid sick and safe leave time accrual unless their 33 normal workweek is less than forty (40) hours, in which case paid sick and safe leave time accrues 34 LC000271 - Page 21 of 93 based upon that normal workweek. 1 (c) Paid sick and safe leave time as provided in this chapter shall begin to accrue at the 2 commencement of employment or pursuant to the law’s effective date [July 1, 2018], whichever is 3 later. An employer may provide all paid sick and safe leave time that an employee is expected to 4 accrue in a year at the beginning of the year. 5 (d) An employer may require a waiting period for newly hired employees of up to ninety 6 (90) days. During this waiting period, an employee shall accrue earned sick time pursuant to this 7 section or the employer’s policy, if exempt under § 28-57-4(b), but shall not be permitted to use 8 the earned sick time until after he or she has completed the waiting period. 9 (e) Paid sick and safe leave time shall be carried over to the following calendar year; 10 however, an employee’s use of paid sick and safe leave time provided under this chapter in each 11 calendar year shall not exceed twenty-four (24) hours during calendar year 2018, and thirty-two 12 (32) hours during calendar year 2019, and forty (40) hours per year thereafter. Alternatively, in lieu 13 of carryover of unused earned paid sick and safe leave time from one year to the next, an employer 14 may pay an employee for unused earned paid sick and safe leave time at the end of a year and 15 provide the employee with an amount of paid sick and safe leave that meets or exceeds the 16 requirements of this chapter that is available for the employee’s immediate use at the beginning of 17 the subsequent year. 18 (f) Nothing in this chapter shall be construed as requiring financial or other reimbursement 19 to an employee from an employer upon the employee’s termination, resignation, retirement, or 20 other separation from employment for accrued paid sick and safe leave time that has not been used. 21 (g) If an employee is transferred to a separate division, entity, or location within the state, 22 but remains employed by the same employer as defined in 29 C.F.R. § 791.2 of the federal Fair 23 Labor Standards Act, 29 U.S.C. § 201 et seq., the employee is entitled to all paid sick and safe leave 24 time accrued at the prior division, entity, or location and is entitled to use all paid sick and safe 25 leave time as provided in this act. When there is a separation from employment and the employee 26 is rehired within one hundred thirty-five (135) days of separation by the same employer, previously 27 accrued paid sick and safe leave time that had not been used shall be reinstated. Further, the 28 employee shall be entitled to use accrued paid sick and safe leave time and accrue additional sick 29 and safe leave time at the re-commencement of employment. 30 (h) When a different employer succeeds or takes the place of an existing employer, all 31 employees of the original employer who remain employed by the successor employer within the 32 state are entitled to all earned paid sick and safe leave time they accrued when employed by the 33 original employer, and are entitled to use earned paid sick and safe leave time previously accrued. 34 LC000271 - Page 22 of 93 (i) At its discretion, an employer may loan sick and safe leave time to an employee in 1 advance of accrual by such employee. 2 (j) Temporary employees shall be entitled to use accrued paid sick and safe leave time 3 beginning on the one hundred eightieth (180) calendar day following commencement of their 4 employment, unless otherwise permitted by the employer. On and after the one hundred eightieth 5 (180) calendar day of employment, employees may use paid sick and safe leave time as it is 6 accrued. During this waiting period, an employee shall accrue earned sick time pursuant to this 7 chapter, but shall not be permitted to use the earned sick time until after he or she has completed 8 the waiting period. 9 (k) Seasonal employees shall be entitled to use accrued paid sick and safe leave time 10 beginning on the one hundred fiftieth (150) calendar day following commencement of their 11 employment, unless otherwise permitted by the employer. On and after the one hundred fiftieth 12 (150) calendar day of employment, employees may use paid sick and safe leave time as it is 13 accrued. During this waiting period, an employee shall accrue earned sick time pursuant to this 14 chapter, but shall not be permitted to use the earned sick time until after he or she has completed 15 the waiting period. 16 SECTION 7. Sections 40-8-2, 40-8-6, 40-8-10, 40-8-13, 40-8-13.4, 40-8-16, 40-8-19, 40- 17 8-26 and 40-8-32 of the General Laws in Chapter 40-8 entitled "Medical Assistance" are hereby 18 amended to read as follows: 19 40-8-2. Definitions. 20 As used in this chapter, unless the context shall otherwise require: 21 (1) “Dental service” means and includes emergency care, X-rays for diagnoses, extractions, 22 palliative treatment, and the refitting and relining of existing dentures and prosthesis. 23 (2) “Department” means the department of human services. 24 (3) “Director” means the director of human services Medicaid director. 25 (4) “Drug” means and includes only drugs and biologicals prescribed by a licensed dentist 26 or physician as are either included in the United States pharmacopoeia, national formulary, or are 27 new and nonofficial drugs and remedies. 28 (5) “Inpatient” means a person admitted to and under treatment or care of a physician or 29 surgeon in a hospital or nursing facility that meets standards of and complies with rules and 30 regulations promulgated by the director. 31 (6) “Inpatient hospital services” means the following items and services furnished to an 32 inpatient in a hospital other than a hospital, institution, or facility for tuberculosis or mental 33 diseases: 34 LC000271 - Page 23 of 93 (i) Bed and board; 1 (ii) Nursing services and other related services as are customarily furnished by the hospital 2 for the care and treatment of inpatients and drugs, biologicals, supplies, appliances, and equipment 3 for use in the hospital, as are customarily furnished by the hospital for the care and treatment of 4 patients; 5 (iii)(A) Other diagnostic or therapeutic items or services, including, but not limited to, 6 pathology, radiology, and anesthesiology furnished by the hospital or by others under arrangements 7 made by the hospital, as are customarily furnished to inpatients either by the hospital or by others 8 under such arrangements, and services as are customarily provided to inpatients in the hospital by 9 an intern or resident-in-training under a teaching program having the approval of the Council on 10 Medical Education and Hospitals of the American Medical Association or of any other recognized 11 medical society approved by the director. 12 (B) The term “inpatient hospital services” shall be taken to include medical and surgical 13 services provided by the inpatient’s physician, but shall not include the services of a private-duty 14 nurse or services in a hospital, institution, or facility maintained primarily for the treatment and 15 care of patients with tuberculosis or mental diseases. Provided, further, it shall be taken to include 16 only the following organ transplant operations: kidney, liver, cornea, pancreas, bone marrow, lung, 17 heart, and heart/lung, and other organ transplant operations as may be designated by the director 18 after consultation with medical advisory staff or medical consultants; and provided that any such 19 transplant operation is determined by the director or his or her designee to be medically necessary. 20 Prior written approval of the director, or his or her designee, shall be required for all covered organ 21 transplant operations. 22 (C) In determining medical necessity for organ transplant procedures, the state plan shall 23 adopt a case-by-case approach and shall focus on the medical indications and contra-indications in 24 each instance; the progressive nature of the disease; the existence of any alternative therapies; the 25 life-threatening nature of the disease; the general state of health of the patient apart from the 26 particular organ disease; and any other relevant facts and circumstances related to the applicant and 27 the particular transplant procedure. 28 (7) "Medicare equivalent rate" means the amount that would be paid for the relevant 29 services as furnished by the relevant group of facilities under Medicare payment principles 30 delineated in subchapter B of 42 CFR Chapter IV. Should no direct Medicare rates be available for 31 the particular service and facility group, the Medicaid director will estimate the rate. Providers will 32 have standing to bring an action in superior court for a higher rate, but intermediary insurers such 33 as managed care entities shall have no standing to bring an action for a lower rate. 34 LC000271 - Page 24 of 93 (7)(8) “Nursing services” means the following items and services furnished to an inpatient 1 in a nursing facility: 2 (i) Bed and board; 3 (ii) Nursing care and other related services as are customarily furnished to inpatients 4 admitted to the nursing facility, and drugs, biologicals, supplies, appliances, and equipment for use 5 in the facility, as are customarily furnished in the facility for the care and treatment of patients; 6 (iii) Other diagnostic or therapeutic items or services, legally furnished by the facility or 7 by others under arrangements made by the facility, as are customarily furnished to inpatients either 8 by the facility or by others under such arrangement; 9 (iv) Medical services provided in the facility by the inpatient’s physician, or by an intern 10 or resident-in-training of a hospital with which the facility is affiliated or that is under the same 11 control, under a teaching program of the hospital approved as provided in subsection (6); and 12 (v) A personal-needs allowance of seventy-five dollars ($75.00) two hundred dollars 13 ($200) per month. 14 (8)(9) “Relative with whom the dependent child is living” means and includes the father, 15 mother, grandfather, grandmother, brother, sister, stepfather, stepmother, stepbrother, stepsister, 16 uncle, aunt, first cousin, nephew, or niece of any dependent child who maintains a home for the 17 dependent child. 18 (9)(10) “Visiting nurse service” means part-time or intermittent nursing care provided by 19 or under the supervision of a registered professional nurse other than in a hospital or nursing home. 20 40-8-6. Review of application for benefits. 21 The director, or someone designated by him or her, shall review each application for 22 benefits filed in accordance with regulations, and shall make a determination of whether the 23 application will be honored and the extent of the benefits to be made available to the applicant, and 24 shall, within thirty (30) fifteen (15) days after the filing, notify the applicant, in writing, of the 25 determination. If the application is rejected, the notice to the applicant shall set forth therein the 26 reason therefor. The director may at any time reconsider any determination. 27 40-8-10. Recovery of benefits paid in error. 28 Any person, who through error or mistake of himself or herself or another willful and 29 knowingly fraudulent misrepresentation, receives medical care benefits to which he or she is not 30 entitled or with respect to which he or she was ineligible, shall be required to reimburse the state 31 for the benefits paid through error or mistake that were paid out during a time period, not to exceed 32 three years, where the person was not entitled to benefits but received them as a result of the willful 33 and knowing fraudulent misrepresentation. 34 LC000271 - Page 25 of 93 40-8-13. Rules, regulations, and fee schedules. 1 The director shall make and promulgate rules, regulations, and fee schedules not 2 inconsistent with state law and fiscal procedures as he or she deems necessary for the proper 3 administration of this chapter and to carry out the policy and purposes thereof, and to make the 4 department’s plan conform to the provisions of the federal Social Security Act, 42 U.S.C. § 1396 5 et seq., and any rules or regulations promulgated pursuant thereto. Except where explicitly 6 authorized by this title, the director shall have no power to set any fee schedule below the Medicare 7 equivalent rate; provided, however, that the director shall be empowered to provide a lower rate 8 equal to the maximum rate where federal reimbursement can be obtained in the event that federal 9 reimbursement cannot be obtained for the Medicare equivalent rate. For outpatient behavioral 10 health services, the minimum fee schedule shall be set at one hundred fifty percent (150%) of the 11 Medicare equivalent rate. The director shall attempt to obtain federal reimbursement for billing 12 outpatient behavioral health services at one hundred fifty percent (150%) of the Medicare 13 equivalent rate, but the state shall bear the costs of this higher rate for outpatient behavioral health 14 services even if federal reimbursement cannot be obtained. Should federal financial participation 15 be impossible to obtain for outpatient behavioral health services rate of one hundred fifty percent 16 (150%) of the Medicare equivalent rate, the director shall impose a surtax on the tax imposed on 17 health insurers pursuant to chapter 17 of title 44 in the amount necessary to defray the costs of the 18 inability to obtain federal reimbursement for an outpatient behavioral health services rate of one 19 hundred fifty percent (150%) of the Medicare equivalent rate. 20 40-8-13.4. Rate methodology for payment for in-state and out-of-state hospital 21 services. 22 (a) The executive office of health and human services (“executive office”) shall implement 23 a new methodology for payment for in-state and out-of-state hospital services in order to ensure 24 access to, and the provision of, high-quality and cost-effective hospital care to its eligible recipients. 25 (b) In order to improve efficiency and cost-effectiveness, the executive office shall: 26 (1)(i) With respect to inpatient services for persons in fee-for-service Medicaid, which is 27 non-managed care, implement a new payment methodology for inpatient services utilizing the 28 Diagnosis Related Groups (DRG) method of payment, which is, a patient-classification method 29 that provides a means of relating payment to the hospitals to the type of patients cared for by the 30 hospitals. It is understood that a payment method based on DRG may include cost outlier payments 31 and other specific exceptions. The executive office will review the DRG-payment method and the 32 DRG base price annually, making adjustments as appropriate in consideration of such elements as 33 trends in hospital input costs; patterns in hospital coding; beneficiary access to care; and the Centers 34 LC000271 - Page 26 of 93 for Medicare and Medicaid Services national CMS Prospective Payment System (IPPS) Hospital 1 Input Price Index. For the twelve-month (12) period beginning July 1, 2015, the DRG base rate for 2 Medicaid fee-for-service inpatient hospital services shall not exceed ninety-seven and one-half 3 percent (97.5%) of the payment rates in effect as of July 1, 2014. Beginning July 1, 2019, the DRG 4 base rate for Medicaid fee-for-service inpatient hospital services shall be 107.2% of the payment 5 rates in effect as of July 1, 2018. Increases in the Medicaid fee-for-service DRG hospital payments 6 for the twelve-month (12) period beginning July 1, 2020, shall be based on the payment rates in 7 effect as of July 1 of the preceding fiscal year, and shall be the Centers for Medicare and Medicaid 8 Services national Prospective Payment System (IPPS) Hospital Input Price Index. Beginning July 9 1, 2022, the DRG base rate for Medicaid fee-for-service inpatient hospital services shall be one 10 hundred five percent (105%) of the payment rates in effect as of July 1, 2021. Increases in the 11 Medicaid fee-for-service DRG hospital payments for each annual twelve-month (12) period 12 beginning July 1, 2023, shall be based on the payment rates in effect as of July 1 of the preceding 13 fiscal year, and shall be the Centers for Medicare and Medicaid Services national Prospective 14 Payment System (IPPS) Hospital Input Price Index. Beginning July 1, 2025, payments for inpatient 15 services in fee-for-service Medicaid shall cease utilizing the DRG method of payment, and 16 payments shall take place on a pure fee-for-services basis, unless a provider shall elect to utilize 17 the DRG payment methodology. DRG rates shall be set equal to ninety percent (90%) of a 18 reasonable estimate of the Medicare equivalent rate. Non-DRG rates shall be set by the Medicaid 19 director through regulation in order that the projected overall per capita expenditures shall equal 20 ninety-five percent (95%) of a reasonable estimate of the equivalent overall per capital expenditures 21 that would have been reached under the Medicare equivalent rate. 22 (ii) With respect to inpatient services, (A) It is required as of January 1, 2011, until 23 December 31, 2011, that the Medicaid managed care payment rates between each hospital and 24 health plan shall not exceed ninety and one-tenth percent (90.1%) of the rate in effect as of June 25 30, 2010. Increases in inpatient hospital payments for each annual twelve-month (12) period 26 beginning January 1, 2012, may not exceed the Centers for Medicare and Medicaid Services 27 national CMS Prospective Payment System (IPPS) Hospital Input Price Index for the applicable 28 period; (B) Provided, however, for the twenty-four-month (24) period beginning July 1, 2013, the 29 Medicaid managed care payment rates between each hospital and health plan shall not exceed the 30 payment rates in effect as of January 1, 2013, and for the twelve-month (12) period beginning July 31 1, 2015, the Medicaid managed care payment inpatient rates between each hospital and health plan 32 shall not exceed ninety-seven and one-half percent (97.5%) of the payment rates in effect as of 33 January 1, 2013; (C) Increases in inpatient hospital payments for each annual twelve-month (12) 34 LC000271 - Page 27 of 93 period beginning July 1, 2017, shall be the Centers for Medicare and Medicaid Services national 1 CMS Prospective Payment System (IPPS) Hospital Input Price Index, less Productivity 2 Adjustment, for the applicable period and shall be paid to each hospital retroactively to July 1; (D) 3 Beginning July 1, 2019, the Medicaid managed care payment inpatient rates between each hospital 4 and health plan shall be 107.2% of the payment rates in effect as of January 1, 2019, and shall be 5 paid to each hospital retroactively to July 1; (E) Increases in inpatient hospital payments for each 6 annual twelve-month (12) period beginning July 1, 2020, shall be based on the payment rates in 7 effect as of January 1 of the preceding fiscal year, and shall be the Centers for Medicare and 8 Medicaid Services national CMS Prospective Payment System (IPPS) Hospital Input Price Index, 9 less Productivity Adjustment, for the applicable period and shall be paid to each hospital 10 retroactively to July 1; the executive office will develop an audit methodology and process to assure 11 that savings associated with the payment reductions will accrue directly to the Rhode Island 12 Medicaid program through reduced managed care plan payments and shall not be retained by the 13 managed care plans; (F) Beginning July 1, 2022, the Medicaid managed care payment inpatient 14 rates between each hospital and health plan shall be one hundred five percent (105%) of the 15 payment rates in effect as of January 1, 2022, and shall be paid to each hospital retroactively to July 16 1 within ninety days of passage; (G) Increases in inpatient hospital payments for each annual 17 twelve-month (12) period beginning July 1, 2023, shall be based on the payment rates in effect as 18 of January 1 of the preceding fiscal year, and shall be the Centers for Medicare and Medicaid 19 Services national CMS Prospective Payment System (IPPS) Hospital Input Price Index, less 20 Productivity Adjustment, for the applicable period and shall be paid to each hospital retroactively 21 to July 1 within ninety days of passage; (H) All hospitals licensed in Rhode Island shall accept such 22 payment rates as payment in full; and (I) For all such hospitals, compliance with the provisions of 23 this section shall be a condition of participation in the Rhode Island Medicaid program. Beginning 24 July 1, 2025, Medicaid managed care payment rates shall equal one hundred five percent (105%) 25 of the fee-for-service rates set in subsection (b)(1)(i) of this section. 26 (2) With respect to outpatient services and notwithstanding any provisions of the law to the 27 contrary, for persons enrolled in fee-for-service Medicaid, the executive office will reimburse 28 hospitals for outpatient services using a rate methodology determined by the executive office and 29 in accordance with federal regulations. Fee-for-service outpatient rates shall align with Medicare 30 payments for similar services. Notwithstanding the above, there shall be no increase in the 31 Medicaid fee-for-service outpatient rates effective on July 1, 2013, July 1, 2014, or July 1, 2015. 32 For the twelve-month (12) period beginning July 1, 2015, Medicaid fee-for-service outpatient rates 33 shall not exceed ninety-seven and one-half percent (97.5%) of the rates in effect as of July 1, 2014. 34 LC000271 - Page 28 of 93 Increases in the outpatient hospital payments for the twelve-month (12) period beginning July 1, 1 2016, may not exceed the CMS national Outpatient Prospective Payment System (OPPS) Hospital 2 Input Price Index. Beginning July 1, 2019, the Medicaid fee-for-service outpatient rates shall be 3 107.2% of the payment rates in effect as of July 1, 2018. Increases in the outpatient hospital 4 payments for the twelve-month (12) period beginning July 1, 2020, shall be based on the payment 5 rates in effect as of July 1 of the preceding fiscal year, and shall be the CMS national Outpatient 6 Prospective Payment System (OPPS) Hospital Input Price Index. Beginning July 1, 2022, the 7 Medicaid fee-for-service outpatient rates shall be one hundred five percent (105%) of the payment 8 rates in effect as of July 1, 2021. Increases in the outpatient hospital payments for each annual 9 twelve-month (12) period beginning July 1, 2023, shall be based on the payment rates in effect as 10 of July 1 of the preceding fiscal year, and shall be the CMS national Outpatient Prospective 11 Payment System (OPPS) Hospital Input Price Index. With respect to the outpatient rate, (i) It is 12 required as of January 1, 2011, until December 31, 2011, that the Medicaid managed care payment 13 rates between each hospital and health plan shall not exceed one hundred percent (100%) of the 14 rate in effect as of June 30, 2010; (ii) Increases in hospital outpatient payments for each annual 15 twelve-month (12) period beginning January 1, 2012, until July 1, 2017, may not exceed the Centers 16 for Medicare and Medicaid Services national CMS Outpatient Prospective Payment System OPPS 17 Hospital Price Index for the applicable period; (iii) Provided, however, for the twenty-four-month 18 (24) period beginning July 1, 2013, the Medicaid managed care outpatient payment rates between 19 each hospital and health plan shall not exceed the payment rates in effect as of January 1, 2013, 20 and for the twelve-month (12) period beginning July 1, 2015, the Medicaid managed care outpatient 21 payment rates between each hospital and health plan shall not exceed ninety-seven and one-half 22 percent (97.5%) of the payment rates in effect as of January 1, 2013; (iv) Increases in outpatient 23 hospital payments for each annual twelve-month (12) period beginning July 1, 2017, shall be the 24 Centers for Medicare and Medicaid Services national CMS OPPS Hospital Input Price Index, less 25 Productivity Adjustment, for the applicable period and shall be paid to each hospital retroactively 26 to July 1; (v) Beginning July 1, 2019, the Medicaid managed care outpatient payment rates between 27 each hospital and health plan shall be one hundred seven and two-tenths percent (107.2%) of the 28 payment rates in effect as of January 1, 2019, and shall be paid to each hospital retroactively to July 29 1; (vi) Increases in outpatient hospital payments for each annual twelve-month (12) period 30 beginning July 1, 2020, shall be based on the payment rates in effect as of January 1 of the preceding 31 fiscal year, and shall be the Centers for Medicare and Medicaid Services national CMS OPPS 32 Hospital Input Price Index, less Productivity Adjustment, for the applicable period and shall be 33 paid to each hospital retroactively to July 1; (vii) Beginning July 1, 2022, the Medicaid managed 34 LC000271 - Page 29 of 93 care outpatient payment rates between each hospital and health plan shall be one hundred five 1 percent (105%) of the payment rates in effect as of January 1, 2022, and shall be paid to each 2 hospital retroactively to July 1 within ninety days of passage; (viii) Increases in outpatient hospital 3 payments for each annual twelve-month (12) period beginning July 1, 2020, shall be based on the 4 payment rates in effect as of January 1 of the preceding fiscal year, and shall be the Centers for 5 Medicare and Medicaid Services national CMS OPPS Hospital Input Price Index, less Productivity 6 Adjustment, for the applicable period and shall be paid to each hospital retroactively to July 1. 7 Beginning July 1, 2025, fee-for-service and managed care outpatient rates shall equal the Medicare 8 equivalent rate. 9 (3) “Hospital,” as used in this section, shall mean the actual facilities and buildings in 10 existence in Rhode Island, licensed pursuant to § 23-17-1 et seq. on June 30, 2010, and thereafter 11 any premises included on that license, regardless of changes in licensure status pursuant to chapter 12 17.14 of title 23 (hospital conversions) and § 23-17-6(b) (change in effective control), that provides 13 short-term, acute inpatient and/or outpatient care to persons who require definitive diagnosis and 14 treatment for injury, illness, disabilities, or pregnancy. Notwithstanding the preceding language, 15 the Medicaid managed care payment rates for a court-approved purchaser that acquires a hospital 16 through receivership, special mastership or other similar state insolvency proceedings (which court- 17 approved purchaser is issued a hospital license after January 1, 2013), shall be based upon the new 18 rates between the court-approved purchaser and the health plan, and such rates shall be effective as 19 of the date that the court-approved purchaser and the health plan execute the initial agreement 20 containing the new rates. The rate-setting methodology for inpatient-hospital payments and 21 outpatient-hospital payments set forth in subsections (b)(1)(ii)(C) and (b)(2), respectively, shall 22 thereafter apply to increases for each annual twelve-month (12) period as of July 1 following the 23 completion of the first full year of the court-approved purchaser’s initial Medicaid managed care 24 contract. 25 (c) It is intended that payment utilizing phasing out the DRG method shall reward hospitals 26 for providing the most efficient highest quality care, and provide the executive office the 27 opportunity to conduct value-based purchasing of inpatient care. 28 (d) The secretary of the executive office is hereby authorized to promulgate such rules and 29 regulations consistent with this chapter, and to establish fiscal procedures he or she deems 30 necessary, for the proper implementation and administration of this chapter in order to provide 31 payment to hospitals using the DRG-payment methodology. Furthermore, amendment of the Rhode 32 Island state plan for Medicaid, pursuant to Title XIX of the federal Social Security Act, 42 U.S.C. 33 § 1396 et seq., is hereby authorized to provide for payment to hospitals for services provided to 34 LC000271 - Page 30 of 93 eligible recipients in accordance with this chapter. 1 (e) The executive office shall comply with all public notice requirements necessary to 2 implement these rate changes. 3 (f) As a condition of participation in the DRG methodology for payment of hospital 4 services, every hospital shall submit year-end settlement reports to the executive office within one 5 year from the close of a hospital’s fiscal year. Should a participating hospital fail to timely submit 6 a year-end settlement report as required by this section, the executive office shall withhold 7 financial-cycle payments due by any state agency with respect to this hospital by not more than ten 8 percent (10%) until the report is submitted. For hospital fiscal year 2010 and all subsequent fiscal 9 years, hospitals will not be required to submit year-end settlement reports on payments for 10 outpatient services. For hospital fiscal year 2011 and all subsequent fiscal years, hospitals will not 11 be required to submit year-end settlement reports on claims for hospital inpatient services. Further, 12 for hospital fiscal year 2010, hospital inpatient claims subject to settlement shall include only those 13 claims received between October 1, 2009, and June 30, 2010. 14 (g) The provisions of this section shall be effective upon implementation of the new 15 payment methodology set forth in this section and § 40-8-13.3, which shall in any event be no later 16 than March 30, 2010, at which time the provisions of §§ 40-8-13.2, 27-19-14, 27-19-15, and 27- 17 19-16 shall be repealed in their entirety. 18 40-8-16. Notification of long-term care alternative. 19 (a) The department of human services, before authorizing care in a nursing home or 20 intermediate-care facility for a person who is eligible to receive benefits pursuant to Title XIX of 21 the federal Social Security Act, 42 U.S.C. § 1396 et seq., and who is being discharged from a 22 hospital to a nursing home, shall notify the person, in writing, of the provisions of the long-term- 23 care alternative, a home- and a community-based program. 24 (b) If a person, eligible to receive benefits pursuant to Title XIX of the federal Social 25 Security Act, requires services in a nursing home and desires to remain in his or her own home or 26 the home of a responsible relative or other adult, the person or his or her representative shall so 27 inform the department. 28 (c) The department shall not make payments pursuant to Title XIX of the federal Social 29 Security Act for benefits until written notification documenting the person’s choice as to a nursing 30 home or home- and community-based services has been filed with the department. 31 40-8-19. Rates of payment to nursing facilities. 32 (a) Rate reform. 33 (1) The rates to be paid by the state to nursing facilities licensed pursuant to chapter 17 of 34 LC000271 - Page 31 of 93 title 23, and certified to participate in Title XIX of the Social Security Act for services rendered to 1 Medicaid-eligible residents, shall be reasonable and adequate to meet the costs that must be 2 incurred by efficiently and economically operated facilities in accordance with 42 U.S.C. § 3 1396a(a)(13). The executive office of health and human services (“executive office”) shall 4 promulgate or modify the principles of reimbursement for nursing facilities in effect as of July 1, 5 2011, to be consistent with the provisions of this section and Title XIX, 42 U.S.C. § 1396 et seq., 6 of the Social Security Act. 7 (2) The executive office shall review the current methodology for providing Medicaid 8 payments to nursing facilities, including other long-term care services providers, and is authorized 9 to modify the principles of reimbursement to replace the current cost-based methodology rates with 10 rates based on a price-based methodology to be paid to all facilities with recognition of the acuity 11 of patients and the relative Medicaid occupancy, and to include the following elements to be 12 developed by the executive office: 13 (i) A direct-care rate adjusted for resident acuity; 14 (ii) An indirect-care and other direct-care rate comprised of a base per diem for all facilities; 15 (iii) Revision of rates as necessary based on increases in direct and indirect costs beginning 16 October 2024 utilizing data from the most recent finalized year of facility cost report. The per diem 17 rate components deferred in subsections (a)(2)(i) and (a)(2)(ii) of this section shall be adjusted 18 accordingly to reflect changes in direct and indirect care costs since the previous rate review; 19 (iv) Application of a fair-rental value system; 20 (v) Application of a pass-through system; and 21 (vi) Adjustment of rates by the change in a recognized national nursing home inflation 22 index to be applied on October 1 of each year, beginning October 1, 2012. This adjustment will not 23 occur on October 1, 2013, October 1, 2014, or October 1, 2015, but will occur on April 1, 2015. 24 The adjustment of rates will also not occur on October 1, 2017, October 1, 2018, October 1, 2019, 25 and October 2022. Effective July 1, 2018, rates paid to nursing facilities from the rates approved 26 by the Centers for Medicare and Medicaid Services and in effect on October 1, 2017, both fee-for- 27 service and managed care, will be increased by one and one-half percent (1.5%) and further 28 increased by one percent (1%) on October 1, 2018, and further increased by one percent (1%) on 29 October 1, 2019. Effective October 1, 2022, rates paid to nursing facilities from the rates approved 30 by the Centers for Medicare and Medicaid Services and in effect on October 1, 2021, both fee-for- 31 service and managed care, will be increased by three percent (3%). In addition to the annual nursing 32 home inflation index adjustment, there shall be a base rate staffing adjustment of one-half percent 33 (0.5%) on October 1, 2021, one percent (1.0%) on October 1, 2022, and one and one-half percent 34 LC000271 - Page 32 of 93 (1.5%) on October 1, 2023. The inflation index shall be applied without regard for the transition 1 factors in subsections (b)(1) and (b)(2). For purposes of October 1, 2016, adjustment only, any rate 2 increase that results from application of the inflation index to subsections (a)(2)(i) and (a)(2)(ii) 3 shall be dedicated to increase compensation for direct-care workers in the following manner: Not 4 less than 85% of this aggregate amount shall be expended to fund an increase in wages, benefits, 5 or related employer costs of direct-care staff of nursing homes. For purposes of this section, direct- 6 care staff shall include registered nurses (RNs), licensed practical nurses (LPNs), certified nursing 7 assistants (CNAs), certified medical technicians, housekeeping staff, laundry staff, dietary staff, or 8 other similar employees providing direct-care services; provided, however, that this definition of 9 direct-care staff shall not include: (i) RNs and LPNs who are classified as “exempt employees” 10 under the federal Fair Labor Standards Act (29 U.S.C. § 201 et seq.); or (ii) CNAs, certified medical 11 technicians, RNs, or LPNs who are contracted, or subcontracted, through a third-party vendor or 12 staffing agency. By July 31, 2017, nursing facilities shall submit to the secretary, or designee, a 13 certification that they have complied with the provisions of this subsection (a)(2)(vi) with respect 14 to the inflation index applied on October 1, 2016. Any facility that does not comply with the terms 15 of such certification shall be subjected to a clawback, paid by the nursing facility to the state, in the 16 amount of increased reimbursement subject to this provision that was not expended in compliance 17 with that certification. 18 (3) Commencing on October 1, 2021, eighty percent (80%) of any rate increase that results 19 from application of the inflation index to subsections (a)(2)(i) and (a)(2)(ii) of this section shall be 20 dedicated to increase compensation for all eligible direct-care workers in the following manner on 21 October 1, of each year. 22 (i) For purposes of this subsection, compensation increases shall include base salary or 23 hourly wage increases, benefits, other compensation, and associated payroll tax increases for 24 eligible direct-care workers. This application of the inflation index shall apply for Medicaid 25 reimbursement in nursing facilities for both managed care and fee-for-service. For purposes of this 26 subsection, direct-care staff shall include registered nurses (RNs), licensed practical nurses (LPNs), 27 certified nursing assistants (CNAs), certified medication technicians, licensed physical therapists, 28 licensed occupational therapists, licensed speech-language pathologists, mental health workers 29 who are also certified nurse assistants, physical therapist assistants, housekeeping staff, laundry 30 staff, dietary staff, or other similar employees providing direct-care services; provided, however 31 that this definition of direct-care staff shall not include: 32 (A) RNs and LPNs who are classified as “exempt employees” under the federal Fair Labor 33 Standards Act (29 U.S.C. § 201 et seq.); or 34 LC000271 - Page 33 of 93 (B) CNAs, certified medication technicians, RNs, or LPNs who are contracted or 1 subcontracted through a third-party vendor or staffing agency. 2 (4)(i) By July 31, 2021, and July 31 of each year thereafter, nursing facilities shall submit 3 to the secretary or designee a certification that they have complied with the provisions of subsection 4 (a)(3) of this section with respect to the inflation index applied on October 1. The executive office 5 of health and human services (EOHHS) shall create the certification form nursing facilities must 6 complete with information on how each individual eligible employee’s compensation increased, 7 including information regarding hourly wages prior to the increase and after the compensation 8 increase, hours paid after the compensation increase, and associated increased payroll taxes. A 9 collective bargaining agreement can be used in lieu of the certification form for represented 10 employees. All data reported on the compliance form is subject to review and audit by EOHHS. 11 The audits may include field or desk audits, and facilities may be required to provide additional 12 supporting documents including, but not limited to, payroll records. 13 (ii) Any facility that does not comply with the terms of certification shall be subjected to a 14 clawback and twenty-five percent (25%) penalty of the unspent or impermissibly spent funds, paid 15 by the nursing facility to the state, in the amount of increased reimbursement subject to this 16 provision that was not expended in compliance with that certification. 17 (iii) In any calendar year where no inflationary index is applied, eighty percent (80%) of 18 the base rate staffing adjustment in that calendar year pursuant to subsection (a)(2)(vi) of this 19 section shall be dedicated to increase compensation for all eligible direct-care workers in the 20 manner referenced in subsections (a)(3)(i), (a)(3)(i)(A), and (a)(3)(i)(B) of this section. 21 (b) Transition to full implementation of rate reform. For no less than four (4) years after 22 the initial application of the price-based methodology described in subsection (a)(2) to payment 23 rates, the executive office of health and human services shall implement a transition plan to 24 moderate the impact of the rate reform on individual nursing facilities. The transition shall include 25 the following components: 26 (1) No nursing facility shall receive reimbursement for direct-care costs that is less than 27 the rate of reimbursement for direct-care costs received under the methodology in effect at the time 28 of passage of this act; for the year beginning October 1, 2017, the reimbursement for direct-care 29 costs under this provision will be phased out in twenty-five-percent (25%) increments each year 30 until October 1, 2021, when the reimbursement will no longer be in effect; and 31 (2) No facility shall lose or gain more than five dollars ($5.00) in its total, per diem rate the 32 first year of the transition. An adjustment to the per diem loss or gain may be phased out by twenty- 33 five percent (25%) each year; except, however, for the years beginning October 1, 2015, there shall 34 LC000271 - Page 34 of 93 be no adjustment to the per diem gain or loss, but the phase out shall resume thereafter; and 1 (3) The transition plan and/or period may be modified upon full implementation of facility 2 per diem rate increases for quality of care-related measures. Said modifications shall be submitted 3 in a report to the general assembly at least six (6) months prior to implementation. 4 (4) Notwithstanding any law to the contrary, for the twelve-month (12) period beginning 5 July 1, 2015, Medicaid payment rates for nursing facilities established pursuant to this section shall 6 not exceed ninety-eight percent (98%) of the rates in effect on April 1, 2015. Consistent with the 7 other provisions of this chapter, nothing in this provision shall require the executive office to restore 8 the rates to those in effect on April 1, 2015, at the end of this twelve-month (12) period. 9 (5) Commencing July 1, 2025, and for each subsequent year, the executive office of health 10 and human services is hereby authorized and directed to amend its regulations for reimbursement 11 to nursing facilities in order that each nursing facility shall be paid the Medicare equivalent rate. 12 The provisions of subsection (a)(3)(iii) shall apply. 13 40-8-26. Community health centers. 14 (a) For the purposes of this section, the term community health centers refers to federally 15 qualified health centers and rural health centers. 16 (b) To support the ability of community health centers to provide high-quality medical care 17 to patients, the executive office of health and human services (“executive office”) may adopt and 18 implement an alternative payment methodology (APM) for determining a Medicaid per-visit 19 reimbursement for community health centers that is compliant with the prospective payment system 20 (PPS) provided for in the Medicare, Medicaid, and SCHIP Benefits Improvement and Protection 21 Act of 2000. The following principles are to ensure that the APM PPS rate determination 22 methodology is part of the executive office overall value purchasing approach. For community 23 health centers that do not agree to the principles of reimbursement that reflect the APM PPS, 24 EOHHS shall reimburse such community health centers at the federal PPS rate, as required per 25 section 1902(bb)(3) of the Social Security Act, 42 U.S.C. § 1396a(bb)(3). For community health 26 centers that are reimbursed at the federal PPS rate, subsections (d) through (f) of this section apply. 27 (c) The APM PPS rate determination methodology will (i) Fairly recognize the reasonable 28 costs of providing services. Recognized reasonable costs will be those appropriate for the 29 organization, management, and direct provision of services and (ii) Provide assurances to the 30 executive office that services are provided in an effective and efficient manner, consistent with 31 industry standards. Except for demonstrated cause and at the discretion of the executive office, the 32 maximum reimbursement rate for a service (e.g., medical, dental) provided by an individual 33 community health center shall not exceed one hundred twenty-five percent (125%) of the median 34 LC000271 - Page 35 of 93 rate for all community health centers within Rhode Island. not only bill the community health center 1 on a fee-for-service basis at the Medicare equivalent rate but also make a series of quality incentive 2 payments if the community health center meets certain quality incentives. Quality incentive 3 payments shall be set at a percentage of the aggregate monthly billing. The quality incentive 4 payments shall be as follows: 5 (1) Ten percent (10%) for meeting benchmarks set by the Medicaid director for screening 6 patients for Medicaid eligibility. 7 (2) Five percent (5%) for meeting benchmarks set by the Medicaid director for enrolling 8 patients who regularly smoke tobacco in smoking cessation programs. 9 (3) Ten percent (10%) for meeting benchmarks set by the director of human services for 10 screening patients for supplemental nutrition assistance program eligibility. 11 (4) Ten percent (10%) for ensuring that no more than one percent (1%) of patients are ever 12 not offered an appointment within a month if they request one. 13 (5) Up to fifteen percent (15%) for meeting benchmarks set by the Medicaid director for 14 the improvement of air quality in patients' homes through directly funding interventions such as: 15 air quality inspections, the installation of air filters, the installation of ventilation, and the 16 replacement of gas stoves with electric stoves. 17 (6) Up to fifteen percent (15%) for meeting benchmarks set by the Medicaid director for 18 the removal or mitigation of environmental toxins in patients' homes through the direct funding of 19 removal or mitigation of environmental toxins. These toxins shall include, but shall not be limited 20 to, lead, radon, asbestos, and carbon monoxide. 21 (d) Community health centers will cooperate fully and timely with reporting requirements 22 established by the executive office. 23 (e) Reimbursement rates established through this methodology shall be incorporated into 24 the PPS reconciliation for services provided to Medicaid-eligible persons who are enrolled in a 25 health plan on the date of service. Monthly payments by the executive office related to PPS for 26 persons enrolled in a health plan shall be made directly to the community health centers. 27 (f) Reimbursement rates established through this the APM methodology shall not be 28 incorporated into the actuarially certified capitation rates paid to a health plan. The health plan shall 29 be responsible for paying the full amount of the reimbursement rate to the community health center 30 for each service eligible for reimbursement under the Medicare, Medicaid, and SCHIP Benefits 31 Improvement and Protection Act of 2000. If the health plan has an alternative payment arrangement 32 with the community health center opts to utilize the APM methodology, the health plan may 33 establish a PPS reconciliation process for eligible services and make monthly payments related to 34 LC000271 - Page 36 of 93 PPS for persons enrolled in the health plan on the date of service shall bear the full upside and 1 downside risk of decreased or increased costs from the APM methodology. The executive office 2 will review, at least annually, the Medicaid reimbursement rates and reconciliation methodology 3 used by the health plans for community health centers to ensure payments to each are made in 4 compliance with the Medicare, Medicaid, and SCHIP Benefits Improvement and Protection Act of 5 2000. 6 40-8-32. Support for certain patients of nursing facilities. 7 (a) Definitions. For purposes of this section: 8 (1) “Applied income” shall mean the amount of income a Medicaid beneficiary is required 9 to contribute to the cost of his or her care. 10 (2) “Authorized individual” shall mean a person who has authority over the income of a 11 patient of a nursing facility, such as a person who has been given or has otherwise obtained 12 authority over a patient’s bank account; has been named as or has rights as a joint account holder; 13 or is a fiduciary as defined below. 14 (3) “Costs of care” shall mean the costs of providing care to a patient of a nursing facility, 15 including nursing care, personal care, meals, transportation, and any other costs, charges, and 16 expenses incurred by a nursing facility in providing care to a patient. Costs of care shall not exceed 17 the customary rate the nursing facility charges to a patient who pays for his or her care directly 18 rather than through a governmental or other third-party payor. 19 (4) “Fiduciary” shall mean a person to whom power or property has been formally 20 entrusted for the benefit of another, such as an attorney-in-fact, legal guardian, trustee, or 21 representative payee. 22 (5) “Nursing facility” shall mean a nursing facility licensed under chapter 17 of title 23, 23 that is a participating provider in the Rhode Island Medicaid program. 24 (6) “Penalty period” means the period of Medicaid ineligibility imposed pursuant to 42 25 U.S.C. § 1396p(c), as amended from time to time, on a person whose assets have been transferred 26 for less than fair market value. 27 (7) “Uncompensated care” — Care and services provided by a nursing facility to a 28 Medicaid applicant without receiving compensation therefore from Medicaid, Medicare, the 29 Medicaid applicant, or other source. The acceptance of any payment representing actual or 30 estimated applied income shall not disqualify the care and services provided from qualifying as 31 uncompensated care. 32 (b) Penalty period resulting from transfer. Any transfer or assignment of assets resulting in 33 the establishment or imposition of a penalty period shall create a debt that shall be due and owing 34 LC000271 - Page 37 of 93 to a nursing facility for the unpaid costs of care provided during the penalty period to a patient of 1 that facility who has been subject to the penalty period. The amount of the debt established shall 2 not exceed the fair market value of the transferred assets at the time of transfer that are the subject 3 of the penalty period. A nursing facility may bring an action to collect a debt for the unpaid costs 4 of care given to a patient who has been subject to a penalty period, against either the transferor or 5 the transferee, or both. The provisions of this section shall not affect other rights or remedies of the 6 parties. 7 (c) Applied income. A nursing facility may provide written notice to a patient who is a 8 Medicaid recipient and any authorized individual of that patient: 9 (1) Of the amount of applied income due; 10 (2) Of the recipient’s legal obligation to pay the applied income to the nursing facility; and 11 (3) That the recipient’s failure to pay applied income due to a nursing facility not later than 12 thirty (30) days after receiving notice from the nursing facility may result in a court action to 13 recover the amount of applied income due. 14 A nursing facility that is owed applied income may, in addition to any other remedies 15 authorized under law, bring a claim to recover the applied income against a patient and any 16 authorized individual. If a court of competent jurisdiction determines, based upon clear and 17 convincing evidence, that a defendant willfully failed to pay or withheld applied income due and 18 owing to a nursing facility for more than thirty (30) days after receiving notice pursuant to 19 subsection (c), the court may award the amount of the debt owed, court costs, and reasonable 20 attorney’s fees to the nursing facility. 21 (d) Effects. Nothing contained in this section shall prohibit or otherwise diminish any other 22 causes of action possessed by any such nursing facility. The death of the person receiving nursing 23 facility care shall not nullify or otherwise affect the liability of the person or persons charged with 24 the costs of care rendered or the applied income amount as referenced in this section. 25 SECTION 8. Sections 40-8-3.1, 40-8-9.1, 40-8-13.5, 40-8-15, 40-8-19.2 and 40-8-27 of 26 the General Laws in Chapter 40-8 entitled "Medical Assistance" are hereby repealed. 27 40-8-3.1. Life estate in property — Retained powers. 28 When an applicant or recipient of Medicaid owns a life estate in property that is his or her 29 principal place of residence with the reserved power and authority, during his or her lifetime, to 30 sell, convey, mortgage, or otherwise dispose of the real property without the consent or joinder by 31 the holder(s) of the remainder interest, the principal place of residence shall not be regarded as an 32 excluded resource for the purpose of Medicaid eligibility, unless the applicant or recipient 33 individually, or through his or her guardian, conservator, or attorney in fact, conveys all outstanding 34 LC000271 - Page 38 of 93 remainder interest to him or herself. 1 An applicant or recipient who, by a deed created, executed and recorded on or before June 2 30, 2014, has reserved a life estate in property that is his or her principal place of residence with 3 the reserved power and authority, during his or her lifetime, to sell, convey, mortgage, or otherwise 4 dispose of the real property without the consent or joinder by the holder(s) of the remainder interest, 5 shall not be ineligible for Medicaid on the basis of the deed, regardless of whether the transferee of 6 the remainder interest is a person or persons, trust, or entity. 7 40-8-9.1. Notice. 8 Whenever an individual who is receiving medical assistance under this chapter transfers 9 an interest in real or personal property, the individual shall notify the executive office of health and 10 human services within ten (10) days of the transfer. The notice shall be sent to the individual’s local 11 office and the legal office of the executive office of health and human services and include, at a 12 minimum, the individual’s name, social security number or, if different, the executive office of 13 health and human services identification number, the date of transfer, and the dollar value, if any, 14 paid or received by the individual who received benefits under this chapter. In the event an 15 individual fails to provide notice required by this section to the executive office of health and human 16 services and in the event an individual has received medical assistance, any individual and/or entity, 17 who knew or should have known that the individual failed to provide the notice and who receives 18 any distribution of value as a result of the transfer, shall be liable to the executive office of health 19 and human services to the extent of the value of the transfer. Moreover, any such individual shall 20 be subject to the provisions of § 40-6-15 and any remedy provided by applicable state and federal 21 laws and rules and regulations. Failure to comply with the notice requirements set forth in the 22 section shall not affect the marketability of title to real estate transferred while the transferor is 23 receiving medical assistance. 24 40-8-13.5. Hospital Incentive Program (HIP). 25 The secretary of the executive office of health and human services is authorized to seek the 26 federal authorities required to implement a hospital incentive program (HIP). The HIP shall provide 27 the participating licensed hospitals the ability to obtain certain payments for achieving performance 28 goals established by the secretary. HIP payments shall commence no earlier than July 1, 2016. 29 40-8-15. Lien on deceased recipient’s estate for assistance. 30 (a)(1) Upon the death of a recipient of Medicaid under Title XIX of the federal Social 31 Security Act (42 U.S.C. § 1396 et seq. and referred to hereinafter as the “Act”), the total sum for 32 Medicaid benefits so paid on behalf of a beneficiary who was fifty-five (55) years of age or older 33 at the time of receipt shall be and constitute a lien upon the estate, as defined in subsection (a)(2), 34 LC000271 - Page 39 of 93 of the beneficiary in favor of the executive office of health and human services (“executive office”). 1 The lien shall not be effective and shall not attach as against the estate of a beneficiary who is 2 survived by a spouse, or a child who is under the age of twenty-one (21), or a child who is blind or 3 permanently and totally disabled as defined in Title XVI of the federal Social Security Act, 42 4 U.S.C. § 1381 et seq. The lien shall attach against property of a beneficiary, which is included or 5 includable in the decedent’s probate estate, regardless of whether or not a probate proceeding has 6 been commenced in the probate court by the executive office or by any other party. Provided, 7 however, that such lien shall only attach and shall only be effective against the beneficiary’s real 8 property included or includable in the beneficiary’s probate estate if such lien is recorded in the 9 land evidence records and is in accordance with subsection (e). Decedents who have received 10 Medicaid benefits are subject to the assignment and subrogation provisions of §§ 40-6-9 and 40-6- 11 10. 12 (2) For purposes of this section, the term “estate” with respect to a deceased individual 13 shall include all real and personal property and other assets included or includable within the 14 individual’s probate estate. 15 (b) The executive office is authorized to promulgate regulations to implement the terms, 16 intent, and purpose of this section and to require the legal representative(s) and/or the heirs-at-law 17 of the decedent to provide reasonable written notice to the executive office of the death of a 18 beneficiary of Medicaid benefits who was fifty-five (55) years of age or older at the date of death, 19 and to provide a statement identifying the decedent’s property and the names and addresses of all 20 persons entitled to take any share or interest of the estate as legatees or distributees thereof. 21 (c) The amount of reimbursement for Medicaid benefits imposed under this section shall 22 also become a debt to the state from the person or entity liable for the payment thereof. 23 (d) Upon payment of the amount of reimbursement for Medicaid benefits imposed by this 24 section, the secretary of the executive office, or his or her designee, shall issue a written discharge 25 of lien. 26 (e) Provided, however, that no lien created under this section shall attach nor become 27 effective upon any real property unless and until a statement of claim is recorded naming the 28 debtor/owner of record of the property as of the date and time of recording of the statement of 29 claim, and describing the real property by a description containing all of the following: (1) Tax 30 assessor’s plat and lot; and (2) Street address. The statement of claim shall be recorded in the 31 records of land evidence in the town or city where the real property is situated. Notice of the lien 32 shall be sent to the duly appointed executor or administrator, the decedent’s legal representative, if 33 known, or to the decedent’s next of kin or heirs at law as stated in the decedent’s last application 34 LC000271 - Page 40 of 93 for Medicaid benefits. 1 (f) The executive office shall establish procedures, in accordance with the standards 2 specified by the Secretary, United States Department of Health and Human Services, under which 3 the executive office shall waive, in whole or in part, the lien and reimbursement established by this 4 section if the lien and reimbursement would cause an undue hardship, as determined by the 5 executive office, on the basis of the criteria established by the secretary in accordance with 42 6 U.S.C. § 1396p(b)(3). 7 (g) Upon the filing of a petition for admission to probate of a decedent’s will or for 8 administration of a decedent’s estate, when the decedent was fifty-five (55) years or older at the 9 time of death, a copy of the petition and a copy of the death certificate shall be sent to the executive 10 office. Within thirty (30) days of a request by the executive office, an executor or administrator 11 shall complete and send to the executive office a form prescribed by that office and shall provide 12 such additional information as the office may require. In the event a petitioner fails to send a copy 13 of the petition and a copy of the death certificate to the executive office and a decedent has received 14 Medicaid benefits for which the executive office is authorized to recover, no distribution and/or 15 payments, including administration fees, shall be disbursed. Any person and/or entity that receives 16 a distribution of assets from the decedent’s estate shall be liable to the executive office to the extent 17 of such distribution. 18 (h) Compliance with the provisions of this section shall be consistent with the requirements 19 set forth in § 33-11-5 and the requirements of the affidavit of notice set forth in § 33-11-5.2. Nothing 20 in these sections shall limit the executive office from recovery, to the extent of the distribution, in 21 accordance with all state and federal laws. 22 (i) To ensure the financial integrity of the Medicaid eligibility determination, benefit 23 renewal, and estate recovery processes in this and related sections, the secretary of health and 24 human services is authorized and directed to, by no later than August 1, 2018: (1) Implement an 25 automated asset verification system, as mandated by § 1940 of the Act, that uses electronic data 26 sources to verify the ownership and value of countable resources held in financial institutions and 27 any real property for applicants and beneficiaries subject to resource and asset tests pursuant to the 28 Act in § 1902(e)(14)(D); (2) Apply the provisions required under §§ 1902(a)(18) and 1917(c) of 29 the Act pertaining to the disposition of assets for less than fair market value by applicants and 30 beneficiaries for Medicaid long-term services and supports and their spouses, without regard to 31 whether they are subject to or exempted from resources and asset tests as mandated by federal 32 guidance; and (3) Pursue any state plan or waiver amendments from the United States Centers for 33 Medicare and Medicaid Services and promulgate such rules, regulations, and procedures he or she 34 LC000271 - Page 41 of 93 deems necessary to carry out the requirements set forth herein and ensure the state plan and 1 Medicaid policy conform and comply with applicable provisions of Title XIX. 2 40-8-19.2. Nursing Facility Incentive Program (NFIP). 3 The secretary of the executive office of health and human services is authorized to seek the 4 federal authority required to implement a nursing facility incentive program (NFIP). The NFIP 5 shall provide the participating licensed nursing facilities the ability to obtain certain payments for 6 achieving performance goals established by the secretary. NFIP payments shall commence no 7 earlier than July 1, 2016. 8 40-8-27. Cooperation by providers. 9 Medicaid providers who employ individuals applying for benefits under any chapter of this 10 title shall comply in a timely manner with requests made by the department for any documents 11 describing employer-sponsored health insurance coverage or benefits the provider offers that are 12 necessary to determine eligibility for the state’s premium assistance program pursuant to § 40-8.4- 13 12. Documents requested by the department may include, but are not limited to, certificates of 14 coverage or a summary of benefits and employee obligations. Upon receiving notification that the 15 department has determined that the employee is eligible for premium assistance under § 40-8.4-12, 16 the provider shall accept the enrollment of the employee and his or her family in the employer- 17 based health insurance plan without regard to any seasonal enrollment restrictions, including open- 18 enrollment restrictions, and/or the impact on the employee’s wages. Additionally, the Medicaid 19 provider employing such persons shall not offer “pay in lieu of benefits.” Providers who do not 20 comply with the provisions set forth in this section shall be subject to suspension as a participating 21 Medicaid provider. 22 SECTION 9. Sections 40-8.4-4, 40-8.4-5, 40-8.4-10, 40-8.4-12, 40-8.4-15 and 40-8.4-19 23 of the General Laws in Chapter 40-8.4 entitled "Health Care for Families" are hereby amended to 24 read as follows: 25 40-8.4-4. Eligibility. 26 (a) Medical assistance for families. There is hereby established a category of medical 27 assistance eligibility pursuant to § 1931 of Title XIX of the Social Security Act, 42 U.S.C. § 1396u- 28 1, for families whose income and resources are no greater than the standards in effect in the aid to 29 families with dependent children program on July 16, 1996, or such increased standards as the 30 department may determine. The executive office of health and human services is directed to amend 31 the medical assistance Title XIX state plan and to submit to the United States Department of Health 32 and Human Services an amendment to the RIte Care waiver project to provide for medical 33 assistance coverage to families under this chapter in the same amount, scope, and duration as 34 LC000271 - Page 42 of 93 coverage provided to comparable groups under the waiver. The department is further authorized 1 and directed to submit amendments and/or requests for waivers to the Title XXI state plan as may 2 be necessary to maximize federal contribution for provision of medical assistance coverage 3 provided pursuant to this chapter, including providing medical coverage as a “qualified state” in 4 accordance with Title XXI of the Social Security Act, 42 U.S.C. § 1397aa et seq. Implementation 5 of expanded coverage under this chapter shall not be delayed pending federal review of any Title 6 XXI amendment or waiver. 7 (b) Income. The secretary of the executive office of health and human services is authorized 8 and directed to amend the medical assistance Title XIX state plan or RIte Care waiver to provide 9 medical assistance coverage through expanded income disregards or other methodology for parents 10 or relative caretakers whose income levels are below one hundred thirty-three percent (133%) of 11 the federal poverty level. 12 (c) Healthcare coverage provided under this section shall also be provided without regard 13 to availability of federal financial participation to a noncitizen family member who is a resident of 14 Rhode Island, and who is otherwise eligible for such assistance. The department is further 15 authorized to promulgate any regulations necessary, and in accord with title XIX [42 U.S.C. § 1396 16 et seq.] and title XXI [42 U.S.C. § 1397 et seq.] of the Social Security Act as necessary in order to 17 implement the state plan amendment. The executive office of health and human services is directed 18 to ensure that federal financial participation is assessed to the maximum extent allowable to provide 19 coverage pursuant to this section, at least every two (2) years, and that state-only funds will be used 20 only if federal financial participation is not available. 21 40-8.4-5. Managed care. 22 The delivery and financing of the healthcare services provided under this chapter shall may 23 be provided through a system of managed care. A managed care system integrates an efficient 24 financing mechanism with quality service delivery; provides a “medical home” to ensure 25 appropriate care and deter unnecessary and inappropriate care; and places emphasis on preventive 26 and primary health care. Beginning July 1, 2029, all payments shall be provided directly by the 27 state without an intermediate payment to a managed care entity or other form of health insurance 28 company, unless it is owned by the state. Beginning July 1, 2025, no new contracts may be entered 29 into between the Medicaid office and an intermediate payor such as a managed care entity or other 30 form of health insurance company for the payment of healthcare services pursuant to this chapter, 31 unless it is owned by the state. 32 40-8.4-10. Regulations. 33 (a) The department of human services Medicaid director is authorized to promulgate any 34 LC000271 - Page 43 of 93 regulations necessary to implement this chapter. 1 (b) When promulgating any rule or regulation necessary to implement this chapter, or any 2 rule or regulation related to RIte Care, the department Medicaid director shall send the notice 3 referred to in § 42-35-3 and a true copy of the rule referred to in § 42-35-4 of the Rhode Island 4 administrative procedures act to each of the co-chairpersons of the permanent joint committee on 5 health care oversight established by § 40-8.4-14. 6 40-8.4-12. RIte Share health insurance premium assistance program. 7 (a) Basic RIte Share health insurance premium assistance program. Under the terms 8 of Section 1906 of Title XIX of the U.S. Social Security Act, 42 U.S.C. § 1396e, states are permitted 9 to pay a Medicaid-eligible person’s share of the costs for enrolling in employer-sponsored health 10 insurance (ESI) coverage if it is cost-effective to do so. Pursuant to the general assembly’s direction 11 in the Rhode Island health reform act of 2000, the Medicaid agency requested and obtained federal 12 approval under § 1916, 42 U.S.C. § 1396o, to establish the RIte Share premium assistance program 13 to subsidize the costs of enrolling Medicaid-eligible persons and families in employer-sponsored 14 health insurance plans that have been approved as meeting certain cost and coverage requirements. 15 The Medicaid agency also obtained, at the general assembly’s direction, federal authority to require 16 any such persons with access to ESI coverage to enroll as a condition of retaining eligibility 17 providing that doing so meets the criteria established in Title XIX for obtaining federal matching 18 funds. 19 (b) Definitions. For the purposes of this section, the following definitions apply: 20 (1) “Cost-effective” means that the portion of the ESI that the state would subsidize, as 21 well as wrap-around costs, would on average cost less to the state than enrolling that same 22 person/family in a managed-care delivery system. 23 (2) “Cost sharing” means any co-payments, deductibles, or co-insurance associated with 24 ESI. 25 (3) “Employee premium” means the monthly premium share a person or family is required 26 to pay to the employer to obtain and maintain ESI coverage. 27 (4) “Employer-sponsored insurance” or “ESI” means health insurance or a group health 28 plan offered to employees by an employer. This includes plans purchased by small employers 29 through the state health insurance marketplace, healthsource, RI (HSRI). 30 (5) “Policy holder” means the person in the household with access to ESI, typically the 31 employee. 32 (6) “RIte Share-approved employer-sponsored insurance (ESI)” means an employer- 33 sponsored health insurance plan that meets the coverage and cost-effectiveness criteria for RIte 34 LC000271 - Page 44 of 93 Share. 1 (7) “RIte Share buy-in” means the monthly amount an Medicaid-ineligible policy holder 2 must pay toward RIte Share-approved ESI that covers the Medicaid-eligible children, young adults, 3 or spouses with access to the ESI. The buy-in only applies in instances when household income is 4 above one hundred fifty percent (150%) of the FPL. 5 (8) “RIte Share premium assistance program” means the Rhode Island Medicaid premium 6 assistance program in which the State pays the eligible Medicaid member’s share of the cost of 7 enrolling in a RIte Share-approved ESI plan. This allows the state to share the cost of the health 8 insurance coverage with the employer. 9 (9) “RIte Share unit” means the entity within the executive office of health and human 10 services (EOHHS) responsible for assessing the cost-effectiveness of ESI, contacting employers 11 about ESI as appropriate, initiating the RIte Share enrollment and disenrollment process, handling 12 member communications, and managing the overall operations of the RIte Share program. 13 (10) “Third-party liability (TPL)” means other health insurance coverage. This insurance 14 is in addition to Medicaid and is usually provided through an employer. Since Medicaid is always 15 the payer of last resort, the TPL is always the primary coverage. 16 (11) “Wrap-around services or coverage” means any healthcare services not included in 17 the ESI plan that would have been covered had the Medicaid member been enrolled in a RIte Care 18 or Rhody Health Partners plan. Coverage of deductibles and co-insurance is included in the wrap. 19 Co-payments to providers are not covered as part of the wrap-around coverage. 20 (c) RIte Share populations. Medicaid beneficiaries subject to eligible for RIte Share 21 include: children, families, parent and caretakers eligible for Medicaid or the children’s health 22 insurance program (CHIP) under this chapter or chapter 12.3 of title 42; and adults between the 23 ages of nineteen (19) and sixty-four (64) who are eligible under chapter 8.12 of this title, not 24 receiving or eligible to receive Medicare, and are enrolled in managed care delivery systems. The 25 following conditions apply: 26 (1) The income of Medicaid beneficiaries shall affect whether and in what manner they 27 must may participate in RIte Share as follows: 28 (i) Income at or below one hundred fifty percent (150%) of FPL — Persons and families 29 determined to have household income at or below one hundred fifty percent (150%) of the federal 30 poverty level (FPL) guidelines based on the modified adjusted gross income (MAGI) standard or 31 other standard approved by the secretary are required to participate in RIte Share if a Medicaid- 32 eligible adult or parent/caretaker has access to cost-effective ESI. Enrolling in ESI through RIte 33 Share shall be a condition of maintaining Medicaid health coverage for any eligible adult with 34 LC000271 - Page 45 of 93 access to such coverage. 1 (ii) Income above one hundred fifty percent (150%) of FPL and policy holder is not 2 Medicaid-eligible — Premium assistance is available when the household includes Medicaid- 3 eligible members, but the ESI policy holder (typically a parent/caretaker, or spouse) is not eligible 4 for Medicaid. Premium assistance for parents/caretakers and other household members who are not 5 Medicaid-eligible may be provided in circumstances when enrollment of the Medicaid-eligible 6 family members in the approved ESI plan is contingent upon enrollment of the ineligible policy 7 holder and the executive office of health and human services (executive office) determines, based 8 on a methodology adopted for such purposes, that it is cost-effective to provide premium assistance 9 for family or spousal coverage. 10 (d) RIte Share enrollment as not a condition of eligibility. RIte Share enrollment shall 11 be purely voluntary and shall never be a condition of eligibility for Medicaid. For Medicaid 12 beneficiaries over the age of nineteen (19), enrollment in RIte Share shall be a condition of 13 eligibility except as exempted below and by regulations promulgated by the executive office. 14 (1) Medicaid-eligible children and young adults up to age nineteen (19) shall not be 15 required to enroll in a parent/caretaker relative’s ESI as a condition of maintaining Medicaid 16 eligibility if the person with access to RIte Share-approved ESI does not enroll as required. These 17 Medicaid-eligible children and young adults shall remain eligible for Medicaid and shall be 18 enrolled in a RIte Care plan. 19 (2) There shall be a limited six-month (6) exemption from the mandatory enrollment 20 requirement for persons participating in the RI works program pursuant to chapter 5.2 of this title. 21 (e) Approval of health insurance plans for premium assistance. The executive office of 22 health and human services shall adopt regulations providing for the approval of employer-based 23 health insurance plans for premium assistance and shall approve employer-based health insurance 24 plans based on these regulations. In order for an employer-based health insurance plan to gain 25 approval, the executive office must determine that the benefits offered by the employer-based 26 health insurance plan are substantially similar in amount, scope, and duration to the benefits 27 provided to Medicaid-eligible persons enrolled in a Medicaid managed care plan, when the plan is 28 evaluated in conjunction with available supplemental benefits provided by the office. The office 29 shall obtain and make available to persons otherwise eligible for Medicaid identified in this section 30 as supplemental benefits those benefits not reasonably available under employer-based health 31 insurance plans that are required for Medicaid beneficiaries by state law or federal law or 32 regulation. Once it has been determined by the Medicaid agency that the ESI offered by a particular 33 employer is RIte Share-approved, all Medicaid members with access to that employer’s plan are 34 LC000271 - Page 46 of 93 required to participate in RIte Share. Failure to meet the mandatory enrollment requirement shall 1 result in the termination of the Medicaid eligibility of the policy holder and other Medicaid 2 members nineteen (19) or older in the household who could be covered under the ESI until the 3 policy holder complies with the RIte Share enrollment procedures established by the executive 4 office. 5 (f) Premium assistance. The executive office shall provide premium assistance by paying 6 all or a portion of the employee’s cost for covering the eligible person and/or his or her family 7 under such a RIte Share-approved ESI plan subject to the buy-in provisions in this section. 8 (g) Buy-in. Persons who can afford it shall share in the cost. — The executive office is 9 authorized and directed to apply for and obtain any necessary state plan and/or waiver amendments 10 from the Secretary of the United States Department of Health and Human Services (DHHS) to 11 require that persons enrolled in a RIte Share-approved employer-based health plan who have 12 income equal to or greater than one hundred fifty percent (150%) of the FPL to buy-in to pay a 13 share of the costs based on the ability to pay, provided that the buy-in cost shall not exceed five 14 percent (5%) of the person’s annual income. The executive office shall implement the buy-in by 15 regulation, and shall consider co-payments, premium shares, or other reasonable means to do so. 16 (h) Maximization of federal contribution. The executive office of health and human 17 services is authorized and directed to apply for and obtain federal approvals and waivers necessary 18 to maximize the federal contribution for provision of medical assistance coverage under this 19 section, including the authorization to amend the Title XXI state plan and to obtain any waivers 20 necessary to reduce barriers to provide premium assistance to recipients as provided for in Title 21 XXI of the Social Security Act, 42 U.S.C. § 1397aa et seq. 22 (i) Implementation by regulation. The executive office of health and human services is 23 authorized and directed to adopt regulations to ensure the establishment and implementation of the 24 premium assistance program in accordance with the intent and purpose of this section, the 25 requirements of Title XIX, Title XXI, and any approved federal waivers. 26 (j) Outreach and reporting. The executive office of health and human services shall 27 develop a plan to identify Medicaid-eligible individuals who have access to employer-sponsored 28 insurance and increase the use of RIte Share benefits. Beginning October 1, 2019, the executive 29 office shall submit the plan to be included as part of the reporting requirements under § 35-17-1. 30 Starting January 1, 2020, the executive office of health and human services shall include the number 31 of Medicaid recipients with access to employer-sponsored insurance, the number of plans that did 32 not meet the cost-effectiveness criteria for RIte Share, and enrollment in the premium assistance 33 program as part of the reporting requirements under § 35-17-1. 34 LC000271 - Page 47 of 93 (k) Employer-sponsored insurance. The executive office of health and human services 1 shall dedicate staff and resources to reporting monthly as part of the requirements under § 35-17-1 2 which employer-sponsored insurance plans meet the cost-effectiveness criteria for RIte Share. 3 Information in the report shall be used for screening for Medicaid enrollment to encourage Rite 4 Share participation. By October 1, 2021, the report shall include any employers with 300 or more 5 employees. By January 1, 2022, the report shall include employers with 100 or more employees. 6 The January report shall also be provided to the chairperson of the house finance committee; the 7 chairperson of the senate finance committee; the house fiscal advisor; the senate fiscal advisor; and 8 the state budget officer. 9 40-8.4-15. Advisory commission on health care. 10 (a) There is hereby established an advisory commission to be known as the “advisory 11 commission on health care” to advise the director of the department of human services on all 12 matters relating to the RIte Care and RIte Share programs, and other matters concerning access for 13 all Rhode Islanders to quality health care in the most affordable, economical manner. The director 14 of the department of human services shall serve ex officio as chairperson. The director shall appoint 15 the eighteen (18) members: 16 (1) Three (3) of whom shall represent the healthcare providers; 17 (2) Three (3) of whom shall represent the healthcare insurers; 18 (3)(2) Three (3) of whom shall represent healthcare consumers or consumer organizations; 19 (4)(3) Two (2) of whom shall represent organized labor; 20 (5)(4) One of whom shall be the health care advocate in the office of the attorney general; 21 and 22 (6) Three (3) of whom shall represent employers; and 23 (7)(5) Three (3) Nine (9) of whom shall be other members of the public. 24 (b) The commission may study all aspects of the provisions of the RIte Care and RIte Share 25 programs involving purchasers of health care, including employers, consumers, and the state, health 26 insurers, providers of health care, and healthcare facilities, and all matters related to the interaction 27 among these groups, including methods to achieve more effective and timely resolution of disputes, 28 better communication, speedier, more reliable and less-costly administrative processes, claims, 29 payments, and other reimbursement matters, and the application of new processes or technologies 30 to such issues. 31 (c) Members of the commission shall be appointed in the month of July, each to hold office 32 until the last day of June in the second year of his or her appointment or until his or her successor 33 is appointed by the director. 34 LC000271 - Page 48 of 93 (d) The commission shall meet at least quarterly, and the initial meeting of the commission 1 shall take place on or before September 15, 2000. The commission may meet more frequently than 2 quarterly at the call of the chair or at the call of any three (3) members of the commission. 3 (e) Members of the permanent joint committee on health care oversight established 4 pursuant to § 40-8.4-14 shall be notified of each meeting of the commission and shall be invited to 5 participate. 6 40-8.4-19. Managed healthcare delivery systems for families. Cost sharing. 7 (a) Notwithstanding any other provision of state law, the delivery and financing of the 8 healthcare services provided under this chapter shall be provided through a system of managed 9 care. “Managed care” is defined as systems that: integrate an efficient financing mechanism with 10 quality service delivery; provide a “medical home” to ensure appropriate care and deter 11 unnecessary services; and place emphasis on preventive and primary care. 12 (b) Enrollment in managed care health delivery systems is mandatory for individuals 13 eligible for medical assistance under this chapter. This includes children in substitute care, children 14 receiving medical assistance through an adoption subsidy, and children eligible for medical 15 assistance based on their disability. Beneficiaries with third-party medical coverage or insurance 16 may be exempt from mandatory managed care in accordance with rules and regulations 17 promulgated by the department of human services for such purposes. 18 (c) Individuals who can afford to contribute shall share in the cost. The department of 19 human services is authorized and directed to apply for and obtain any necessary waivers and/or 20 state plan amendments from the Secretary of the United States Department of Health and Human 21 Services, including, but not limited to, a waiver of the appropriate sections of Title XIX, 42 U.S.C. 22 § 1396 et seq., to require that beneficiaries eligible under this chapter or chapter 12.3 of title 42, 23 with incomes equal to or greater than one hundred fifty percent (150%) of the federal poverty level, 24 pay a share of the costs of health coverage based on the ability to pay. The department of human 25 services shall implement this cost-sharing obligation by regulation, and shall consider co-payments, 26 premium shares, or other reasonable means to do so in accordance with approved provisions of 27 appropriate waivers and/or state plan amendments approved by the Secretary of the United States 28 Department of Health and Human Services. 29 SECTION 10. Section 40-8.4-13 of the General Laws in Chapter 40-8.4 entitled "Health 30 Care for Families" is hereby repealed. 31 40-8.4-13. Utilization of available employer-based health insurance. 32 To the extent permitted under Titles XIX and XXI of the Social Security Act, 42 U.S.C. § 33 1396 et seq. and 42 U.S.C. § 1397aa et seq., or by waiver from the Secretary of the United States 34 LC000271 - Page 49 of 93 Department of Health and Human Services, the department of human services shall adopt 1 regulations to restrict eligibility for RIte Care under this chapter and/or chapter 12.3 of title 42, or 2 the RIte Share program under § 40-8.4-12, for certain periods of time for certain individuals or 3 families who have access to, or have refused or terminated employer-based health insurance and 4 for certain periods of time for certain individuals but not including children whose employer has 5 terminated their employer-based health insurance. The department is authorized and directed to 6 amend the medical assistance Title XIX and XXI state plans, and/or to seek and obtain appropriate 7 federal approvals or waivers to implement this section. 8 SECTION 11. Sections 40-8.5-1 and 40-8.5-1.1 of the General Laws in Chapter 40-8.5 9 entitled "Health Care for Elderly and Disabled Residents Act" are hereby amended to read as 10 follows: 11 40-8.5-1. Categorically needy medical assistance coverage. 12 The department of human services is hereby authorized and directed to amend its Title XIX 13 state plan to provide for categorically needy medical assistance coverage as permitted pursuant to 14 Title XIX of the Social Security Act, 42 U.S.C. § 1396 et seq., as amended, to individuals who are 15 sixty-five (65) years or older or are disabled, as determined under § 1614(a)(3) of the Social 16 Security Act, 42 U.S.C. § 1382c(a)(3), as amended, whose income does not exceed one hundred 17 percent (100%) one hundred thirty-three percent (133%) of the federal poverty level (as revised 18 annually) applicable to the individual’s family size, and whose resources do not exceed four 19 thousand dollars ($4,000) per individual, or six thousand dollars ($6,000) per couple. The 20 department shall provide medical assistance coverage to such elderly or disabled persons in the 21 same amount, duration, and scope as provided to other categorically needy persons under the state’s 22 Title XIX state plan. 23 40-8.5-1.1. Managed healthcare delivery systems. 24 (a) The delivery and financing of the healthcare services provided under this chapter may 25 be provided through a system of managed care. Beginning July 1, 2029, all payments shall be 26 provided directly by the state without an intermediate payment to a managed care entity or other 27 form of health insurance company. Beginning July 1, 2025, no new contracts may be entered into 28 between the Medicaid office and an intermediate payor such as a managed care entity or other form 29 of health insurance company for the payment of healthcare services pursuant to this chapter. To 30 ensure that all medical assistance beneficiaries, including the elderly and all individuals with 31 disabilities, have access to quality and affordable health care, the executive office of health and 32 human services (“executive office”) is authorized to implement mandatory managed-care health 33 systems. 34 LC000271 - Page 50 of 93 (b) “Managed care” is defined as systems that: integrate an efficient financing mechanism 1 with quality service delivery; provide a “medical home” to ensure appropriate care and deter 2 unnecessary services; and place emphasis on preventive and primary care. For purposes of this 3 section, managed care systems may also be defined to include a primary care case-management 4 model, community health teams, and/or other such arrangements that meet standards established 5 by the executive office and serve the purposes of this section. Managed care systems may also 6 include services and supports that optimize the health and independence of beneficiaries who are 7 determined to need Medicaid-funded long-term care under chapter 8.10 of this title or to be at risk 8 for the care under applicable federal state plan or waiver authorities and the rules and regulations 9 promulgated by the executive office. Any Medicaid beneficiaries who have third-party medical 10 coverage or insurance may be provided such services through an entity certified by, or in a 11 contractual arrangement with, the executive office or, as deemed appropriate, exempt from 12 mandatory managed care in accordance with rules and regulations promulgated by the executive 13 office. 14 (c) In accordance with § 42-12.4-7, the executive office is authorized to obtain any approval 15 through waiver(s), category II or III changes, and/or state-plan amendments, from the Secretary of 16 the United States Department of Health and Human Services, that are necessary to implement 17 mandatory, managed healthcare delivery systems for all Medicaid beneficiaries. The waiver(s), 18 category II or III changes, and/or state-plan amendments shall include the authorization to extend 19 managed care to cover long-term-care services and supports. Authorization shall also include, as 20 deemed appropriate, exempting certain beneficiaries with third-party medical coverage or 21 insurance from mandatory managed care in accordance with rules and regulations promulgated by 22 the executive office. 23 (d)(b) To ensure the delivery of timely and appropriate services to persons who become 24 eligible for Medicaid by virtue of their eligibility for a United States Social Security Administration 25 program, the executive office is authorized to seek any and all data-sharing agreements or other 26 agreements with the Social Security Administration as may be necessary to receive timely and 27 accurate diagnostic data and clinical assessments. This information shall be used exclusively for 28 the purpose of service planning, and shall be held and exchanged in accordance with all applicable 29 state and federal medical record confidentiality laws and regulations. 30 SECTION 12. Sections 40-8.12-2 and 40-8.12-3 of the General Laws in Chapter 40-8.12 31 entitled "Health Care for Adults" are hereby amended to read as follows: 32 40-8.12-2. Eligibility. 33 (a) Medicaid coverage for nonpregnant adults without children. There is hereby 34 LC000271 - Page 51 of 93 established, effective January 1, 2014, a category of Medicaid eligibility pursuant to Title XIX of 1 the Social Security Act, as amended by the U.S. Patient Protection and Affordable Care Act (ACA) 2 of 2010, 42 U.S.C. § 1396u-1, for adults ages nineteen (19) to sixty-four (64) who do not have 3 dependent children and do not qualify for Medicaid under Rhode Island general laws applying to 4 families with children and adults who are blind, aged, or living with a disability. The executive 5 office of health and human services is directed to make any amendments to the Medicaid state plan 6 and waiver authorities established under Title XIX necessary to implement this expansion in 7 eligibility and ensure the maximum federal contribution for health insurance coverage provided 8 pursuant to this chapter. 9 (b) Income. The secretary of the executive office of health and human services is authorized 10 and directed to amend the Medicaid Title XIX state plan and, as deemed necessary, any waiver 11 authority to effectuate this expansion of coverage to any Rhode Islander who qualifies for Medicaid 12 eligibility under this chapter with income at or below one hundred and thirty-three percent (133%) 13 of the federal poverty level, based on modified adjusted-gross income. 14 (c) Delivery system. The executive office of health and human services is authorized and 15 directed to apply for and obtain any waiver authorities necessary to provide persons eligible under 16 this chapter with managed, coordinated healthcare coverage consistent with the principles set forth 17 in chapter 12.4 of title 42, pertaining to a healthcare home. Beginning July 1, 2029, all payments 18 shall be provided directly by the state without an intermediate payment to a managed care entity or 19 other form of health insurance company. Beginning July 1, 2025, no new contracts may be entered 20 into between the Medicaid office and an intermediate payor such as a managed care entity or other 21 form of health insurance company for the payment of healthcare services pursuant to this chapter. 22 40-8.12-3. Premium assistance program. 23 (a) The executive office of health and human services is directed to amend its rules and 24 regulations to implement a premium assistance program for adults with dependent children, 25 enrolled in the state’s health-benefits exchange, whose annual income and resources meet the 26 guidelines established in § 40-8.4-4 in effect on December 1, 2013. The premium assistance will 27 pay one-half of the cost of a commercial plan that a parent may incur after subtracting the cost- 28 sharing requirement under § 40-8.4-4 as of December 31, 2013, and any applicable federal tax 29 credits available. The office is also directed to amend the 1115 waiver demonstration extension and 30 the medical assistance Title XIX state plan for this program if it is determined that it is eligible for 31 funding pursuant to Title XIX of the Social Security Act, 42 U.S.C. § 1396 et seq. 32 (b) The executive office of health and human services shall require any individual receiving 33 benefits under a state-funded, healthcare assistance program to apply for any health insurance for 34 LC000271 - Page 52 of 93 which he or she is eligible, including health insurance available through the health benefits 1 exchange. Nothing shall preclude the state from using funds appropriated for Affordable Care Act 2 transition expenses to reduce the impact on an individual who has been transitioned from a state 3 program to a health insurance plan available through the health benefits exchange. It shall not be 4 deemed cost-effective for the state if it would result in a loss of benefits or an increase in the cost 5 of healthcare services for the person above an amount deemed de minimus as determined by state 6 regulation. 7 SECTION 13. Chapter 40-8.13 of the General Laws entitled "Long-Term Managed Care 8 Arrangements" is hereby repealed in its entirety. 9 CHAPTER 40-8.13 10 Long-Term Managed Care Arrangements 11 40-8.13-1. Definitions. 12 For purposes of this section the following terms shall have the meanings indicated: 13 (1) “Beneficiary” means an individual who is eligible for medical assistance under the 14 Rhode Island Medicaid state plan established in accordance with 42 U.S.C. § 1396, and includes 15 individuals who are additionally eligible for benefits under the Medicare program (42 U.S.C. § 16 1395 et seq.) or other health plan. 17 (2) “Duals demonstration project” means a demonstration project established pursuant to 18 the financial alignment demonstration established under section 2602 of the Patient Protection and 19 Affordable Care Act (Pub. L. No. 111-148) [42 U.S.C. § 1315b], involving a three-way contract 20 between Rhode Island, the federal Centers for Medicare and Medicaid Services (“CMS”), and 21 qualified health plans, and covering healthcare services provided to beneficiaries. 22 (3) “EOHHS” means the Rhode Island executive office of health and human services. 23 (4) “EOHHS level-of-care tool” refers to a set of criteria established by EOHHS and used 24 in January, 2014 to determine the long-term-care needs of a beneficiary as well as the appropriate 25 setting for delivery of that care. 26 (5) “Long-term-care services and supports” means a spectrum of services covered by the 27 Rhode Island Medicaid program and/or the Medicare program, that are required by individuals with 28 functional impairments and/or chronic illness, and includes skilled or custodial nursing facility 29 care, as well as various home- and community-based services. 30 (6) “Managed care organization” means any health plan, health-maintenance organization, 31 managed care plan, or other person or entity that enters into a contract with the state under which 32 it is granted the authority to arrange for the provision of, and/or payment for, long-term-care 33 supports and services to eligible beneficiaries under a managed long-term-care arrangement. 34 LC000271 - Page 53 of 93 (7) “Managed long-term-care arrangement” means any arrangement under which a 1 managed care organization is granted some or all of the responsibility for providing and/or paying 2 for long-term-care services and supports that would otherwise be provided or paid under the Rhode 3 Island Medicaid program. The term includes, but is not limited to, a duals demonstration project, 4 and/or phase I and phase II of the integrated care initiative established by the executive office of 5 health and human services. 6 (8) “Plan of care” means a care plan established by a nursing facility in accordance with 7 state and federal regulations and that identifies specific care and services provided to a beneficiary. 8 40-8.13-2. Beneficiary choice. 9 Any managed long-term-care arrangement shall offer beneficiaries the option to decline 10 participation and remain in traditional Medicaid and, if a duals demonstration project, traditional 11 Medicare. Beneficiaries must be provided with sufficient information to make an informed choice 12 regarding enrollment, including: 13 (1) Any changes in the beneficiary’s payment or other financial obligations with respect to 14 long-term-care services and supports as a result of enrollment; 15 (2) Any changes in the nature of the long-term-care services and supports available to the 16 beneficiary as a result of enrollment, including specific descriptions of new services that will be 17 available or existing services that will be curtailed or terminated; 18 (3) A contact person who can assist the beneficiary in making decisions about enrollment; 19 (4) Individualized information regarding whether the managed care organization’s network 20 includes the healthcare providers with whom beneficiaries have established provider relationships. 21 Directing beneficiaries to a website identifying the plan’s provider network shall not be sufficient 22 to satisfy this requirement; and 23 (5) The deadline by which the beneficiary must make a choice regarding enrollment, and 24 the length of time a beneficiary must remain enrolled in a managed care organization before being 25 permitted to change plans or opt out of the arrangement. 26 40-8.13-3. Ombudsman process. 27 EOHHS shall designate an ombudsperson to advocate for beneficiaries enrolled in a 28 managed long-term-care arrangement. The ombudsperson shall advocate for beneficiaries through 29 complaint and appeal processes and ensure that necessary healthcare services are provided. At the 30 time of enrollment, a managed care organization must inform enrollees of the availability of the 31 ombudsperson, including contact information. 32 40-8.13-4. Provider/plan liaison. 33 EOHHS shall designate an individual, not employed by or otherwise under contract with a 34 LC000271 - Page 54 of 93 participating managed care organization, who shall act as liaison between healthcare providers and 1 managed care organizations, for the purpose of facilitating communications and ensuring that issues 2 and concerns are promptly addressed. 3 40-8.13-5. Financial principles under managed care. 4 (a) To the extent that financial savings are a goal under any managed long-term-care 5 arrangement, it is the intent of the legislature to achieve savings through administrative efficiencies, 6 care coordination, improvements in care outcomes and in a way that encourages the highest quality 7 care for patients and maximizes value for the managed-care organization and the state. Therefore, 8 any managed long-term-care arrangement shall include a requirement that the managed care 9 organization reimburse providers for services in accordance with these principles. Notwithstanding 10 any law to the contrary, for the twelve-month (12) period beginning July 1, 2015, Medicaid 11 managed long-term-care payment rates to nursing facilities established pursuant to this section shall 12 not exceed ninety-eight percent (98.0%) of the rates in effect on April 1, 2015. 13 (1) For a duals demonstration project, the managed care organization: 14 (i) Shall not combine the rates of payment for post-acute skilled and rehabilitation care 15 provided by a nursing facility and long-term and chronic care provided by a nursing facility in order 16 to establish a single-payment rate for dual eligible beneficiaries requiring skilled nursing services; 17 (ii) Shall pay nursing facilities providing post-acute skilled and rehabilitation care or long- 18 term and chronic care rates that reflect the different level of services and intensity required to 19 provide these services; and 20 (iii) For purposes of determining the appropriate rate for the type of care identified in 21 subsection (a)(1)(ii) of this section, the managed care organization shall pay no less than the rates 22 that would be paid for that care under traditional Medicare and Rhode Island Medicaid for these 23 service types. The managed care organization shall not, however, be required to use the same 24 payment methodology. 25 The state shall not enter into any agreement with a managed care organization in connection 26 with a duals demonstration project unless that agreement conforms to this section, and any existing 27 such agreement shall be amended as necessary to conform to this subsection. 28 (2) For a managed long-term-care arrangement that is not a duals demonstration project, 29 the managed care organization shall reimburse providers in an amount not less than the amount that 30 would be paid for the same care by the executive office of health and human services under the 31 Medicaid program. The managed care organization shall not, however, be required to use the same 32 payment methodology as the executive office of health and human services. 33 (3) Notwithstanding any provisions of the general or public laws to the contrary, the 34 LC000271 - Page 55 of 93 protections of subsections (a)(1) and (a)(2) of this section may be waived by a nursing facility in 1 the event it elects to accept a payment model developed jointly by the managed care organization 2 and skilled nursing facilities, that is intended to promote quality of care and cost-effectiveness, 3 including, but not limited to, bundled-payment initiatives, value-based purchasing arrangements, 4 gainsharing, and similar models. 5 (b) Notwithstanding any law to the contrary, for the twelve-month (12) period beginning 6 July 1, 2015, Medicaid managed long-term-care payment rates to nursing facilities established 7 pursuant to this section shall not exceed ninety-eight percent (98.0%) of the rates in effect on April 8 1, 2015. 9 40-8.13-6. Payment incentives. 10 In order to encourage quality improvement and promote appropriate utilization incentives 11 for providers in a managed long-term-care arrangement, a managed care organization may use 12 incentive or bonus payment programs that are in addition to the rates identified in § 40-8.13-5. 13 40-8.13-7. Willing provider. 14 A managed care organization must contract with and cover services furnished by any 15 nursing facility licensed under chapter 17 of title 23 and certified by CMS that provides Medicaid- 16 covered nursing facility services pursuant to a provider agreement with the state, provided that the 17 nursing facility is not disqualified under the managed care organization’s quality standards that are 18 applicable to all nursing facilities; and the nursing facility is willing to accept the reimbursement 19 rates described in § 40-8.13-5. 20 40-8.13-8. Level-of-care tool. 21 A managed long-term-care arrangement must require that all participating managed care 22 organizations use only the EOHHS level-of-care tool in determining coverage of long-term-care 23 supports and services for beneficiaries. EOHHS may amend the level-of-care tool provided that 24 any changes are established in consultation with beneficiaries and providers of Medicaid-covered 25 long-term-care supports and services, and are based upon reasonable medical evidence or 26 consensus, in consideration of the specific needs of Rhode Island beneficiaries. Notwithstanding 27 any other provisions herein, however, in the case of a duals demonstration project, a managed care 28 organization may use a different level-of-care tool for determining coverage of services that would 29 otherwise be covered by Medicare, since the criteria established by EOHHS are directed towards 30 Medicaid-covered services; provided, that the level-of-care tool is based on reasonable medical 31 evidence or consensus in consideration of the specific needs of Rhode Island beneficiaries. 32 40-8.13-9. Case management/plan of care. 33 No managed care organization acting under a managed long-term-care arrangement may 34 LC000271 - Page 56 of 93 require a provider to change a plan of care if the provider reasonably believes that such an action 1 would conflict with the provider’s responsibility to develop an appropriate care plan under state 2 and federal regulations. 3 40-8.13-10. Care transitions. 4 In the event that a beneficiary: 5 (1) Has been determined to meet level-of-care requirements for nursing facility coverage 6 as of the date of his or her enrollment in a managed care organization; or 7 (2) Has been determined to meet level of care requirements for nursing facility coverage 8 by a managed care organization after enrollment; and there is a change in condition whereby the 9 managed care organization determines that the beneficiary no longer meets such level-of-care 10 requirements, the nursing facility shall promptly arrange for an appropriate and safe discharge (with 11 the assistance of the managed care organization if the facility requests it), and the managed care 12 organization shall continue to pay for the beneficiary’s nursing facility care at the same rate until 13 the beneficiary is discharged. 14 40-8.13-11. Reporting requirements. 15 EOHHS shall report to the general assembly and shall make available to interested persons 16 a separate accounting of state expenditures for long-term-care supports and services under any 17 managed long-term-care arrangement, specifically and separately identifying expenditures for 18 home- and community-based services, assisted-living services, hospice services within nursing 19 facilities, hospice services outside of nursing facilities, and nursing facility services. Such reports 20 shall be made twice annually, six (6) months apart, beginning six (6) months following the 21 implementation of any managed long-term-care arrangement, and shall include a detailed report of 22 utilization of each service. In order to facilitate reporting, any managed long-term-care arrangement 23 shall include a requirement that a participating managed care organization make timely reports of 24 the data necessary to compile the reports. 25 SECTION 14. Sections 42-7.2-10, 42-7.2-16 and 42-7.2-16.1 of the General Laws in 26 Chapter 42-7.2 entitled "Office of Health and Human Services" are hereby amended to read as 27 follows: 28 42-7.2-10. Appropriations and disbursements. 29 (a) The general assembly shall annually appropriate such sums as it may deem necessary 30 for the purpose of carrying out the provisions of this chapter. The state controller is hereby 31 authorized and directed to draw his or her orders upon the general treasurer for the payment of such 32 sum or sums, or so much thereof as may from time to time be required, upon receipt by him or her 33 of proper vouchers approved by the secretary of the executive office of health and human services, 34 LC000271 - Page 57 of 93 or his or her designee. 1 (b) The general assembly shall, through the utilization of federal Medicaid reimbursement 2 for administrative costs, and additional funds, appropriate such funds as may be necessary to hire 3 additional personnel for the Medicaid office as follows: one hundred (100) outreach social workers 4 to encourage, assist and expedite individuals applying for Medicaid benefits; one hundred (100) 5 new programmers in order to build digital infrastructure for the Medicaid office; thirty (30) new 6 social workers and ten (10) new programmers to help increase spend down program utilization and 7 feasibility and examine possible legal changes necessary to increase spend down program 8 eligibility; and fifty (50) additional personnel for building administrative capacity. The Medicaid 9 office shall be exempt from any limitations placed on the number of full-time equivalent personnel 10 employed by the executive office of health and human services. 11 (b)(c) For the purpose of recording federal financial participation associated with 12 qualifying healthcare workforce development activities at the state’s public institutions of higher 13 education, and pursuant to the Rhode Island designated state health programs (DSHP), as approved 14 by the Centers for Medicare & Medicaid Services (CMC) October 20, 2016, in the 11-W-00242/1 15 amendment to Rhode Island’s section 1115 Demonstration Waiver, there is hereby established a 16 restricted-receipt account entitled “Health System Transformation Project” in the general fund of 17 the state and included in the budget of the office of health and human services. Due to the COVID- 18 19 pandemic, the office of health and human services is forbidden from utilizing any funds within 19 the health system transformation project restricted receipts account for any imposition of downside 20 risk for providers. No payment models that impose downside risk or in any way deviate from fee- 21 for-service shall be utilized for the Medicaid program without explicit authorization by the general 22 assembly. 23 (c)(d) There are hereby created within the general fund of the state and housed within the 24 budget of the office of health and human services two restricted receipt accounts, respectively 25 entitled “HCBS Support-ARPA” and “HCBS Admin Support-ARPA”. Amounts deposited into 26 these accounts are equivalent to the general revenue savings generated by the enhanced federal 27 match received on eligible home and community-based services between April 1, 2021, and March 28 31, 2022, allowable under Section 9817 of the American Rescue Plan Act of 2021, Pub. L. No. 29 117-2. Funds deposited into the “HCBS Support-ARPA” account will be used to finance the state 30 share of newly eligible Medicaid expenditures by the office of health and human services and its 31 sister agencies, including the department of children, youth and families, the department of health, 32 and the department of behavioral healthcare, developmental disabilities and hospitals. Funds 33 deposited into the “HCBS Admin Support-ARPA” account will be used to finance the state share 34 LC000271 - Page 58 of 93 of allowable administrative expenditures attendant to the implementation of these newly eligible 1 Medicaid expenditures. The accounts created under this subsection shall be exempt from the 2 indirect cost recovery provisions of § 35-4-27. 3 (d)(e) There is hereby created within the general fund of the state and housed within the 4 budget of the office of health and human services a restricted receipt account entitled “Rhode Island 5 Statewide Opioid Abatement Account” for the purpose of receiving and expending monies from 6 settlement agreements with opioid manufacturers, pharmaceutical distributors, pharmacies, or their 7 affiliates, as well as monies resulting from bankruptcy proceedings of the same entities. The 8 executive office of health and human services shall deposit any revenues from such sources that 9 are designated for opioid abatement purposes into the restricted receipt account. Funds from this 10 account shall only be used for forward-looking opioid abatement efforts as defined and limited by 11 any settlement agreements, state-city and town agreements, or court orders pertaining to the use of 12 such funds. By January 1 of each calendar year, the secretary of health and human services shall 13 report to the governor, the speaker of the house of representatives, the president of the senate, and 14 the attorney general on the expenditures that were funded using monies from the Rhode Island 15 statewide opioid abatement account and the amount of funds spent. The account created under this 16 subsection shall be exempt from the indirect cost recovery provisions of § 35-4-27. No 17 governmental entity has the authority to assert a claim against the entities with which the attorney 18 general has entered into settlement agreements concerning the manufacturing, marketing, 19 distributing, or selling of opioids that are the subject of the Rhode Island Memorandum of 20 Understanding Between the State and Cities and Towns Receiving Opioid Settlement Funds 21 executed by every city and town and the attorney general and wherein every city and town agreed 22 to release all such claims against these settling entities, and any amendment thereto. Governmental 23 entity means any state or local governmental entity or sub-entity and includes, but is not limited to, 24 school districts, fire districts, and any other such districts. The claims that shall not be asserted are 25 the released claims, as that term is defined in the settlement agreements executed by the attorney 26 general, or, if not defined therein, the claims sought to be released in such settlement agreements. 27 42-7.2-16. Medicaid System Reform 2008. Medicaid System Reform. 28 (a) The executive office of health and human services, in conjunction with the department 29 of human services, the department of children, youth and families, the department of health and the 30 department of behavioral healthcare, developmental disabilities and hospitals, is authorized to 31 design options that further the reforms in Medicaid initiated in 2008 Medicaid reform to ensure that 32 the program: transitions to a Medicare level of care as a first step in the transition to a state-level 33 Medicare for All system; phases out the use of intermediary privatized insurance companies such 34 LC000271 - Page 59 of 93 as managed care entities; transitions to the management of health insurers acquired due to 1 insolvency, smoothly integrating publicly owned health insurers with the Medicaid system; utilizes 2 payment models such as fee-for-service that incentivize higher quality of care and more utilization 3 of care; provides for the financial health of Rhode Island healthcare providers; encourages fair 4 wages and benefits for Rhode Island's healthcare workforce; develops and builds out the Medicaid 5 office's human capital, technological infrastructure, expertise, and general ability to manage 6 healthcare payments to prepare for the transition to a single-payer Medicare-for-All system; and 7 guides the transition of the Rhode Island healthcare funding system to a state-level Medicare-for- 8 All system. utilizes competitive and value based purchasing to maximize the available service 9 options, promotes accountability and transparency, and encourages and rewards healthy outcomes, 10 independence, and responsible choices; promotes efficiencies and the coordination of services 11 across all health and human services agencies; and ensures the state will have a fiscally sound 12 source of publicly-financed health care for Rhode Islanders in need. 13 (b) Principles and goals. In developing and implementing this system of reform, the 14 executive office of health and human services and the four (4) health and human services 15 departments shall pursue the following principles and goals: 16 (1) Empower consumers to make reasoned and cost-effective choices about their health by 17 providing them with the information and array of service options they need and offering rewards 18 for healthy decisions; 19 (2) Encourage personal responsibility by assuring the information available to beneficiaries 20 is easy to understand and accurate, provide that a fiscal intermediary is provided when necessary, 21 and adequate access to needed services; 22 (3) When appropriate, promote community-based care solutions by transitioning 23 beneficiaries from institutional settings back into the community and by providing the needed 24 assistance and supports to beneficiaries requiring long-term care or residential services who wish 25 to remain, or are better served in the community; 26 (4) Enable consumers to receive individualized health care that is outcome-oriented, 27 focused on prevention, disease management, recovery and maintaining independence; 28 (5) Promote competition between healthcare providers to ensure best value purchasing, to 29 leverage resources and to create opportunities for improving service quality and performance; 30 (6) Redesign purchasing and payment methods to assure fiscal accountability and 31 encourage and to reward service quality and cost-effectiveness by tying reimbursements to 32 evidence-based performance measures and standards, including those related to patient satisfaction 33 promote payment models such as fee-for-service that incentivize higher quality of care and phase 34 LC000271 - Page 60 of 93 out the use of payment models that shift risk to providers, such as capitation, episode-based 1 payments, global budgets, and similar models; and 2 (7) Continually improve technology to take advantage of recent innovations and advances 3 that help decision makers, consumers and providers to make informed and cost-effective decisions 4 regarding health care. 5 (c) The executive office of health and human services shall annually submit a report to the 6 governor and the general assembly describing the status of the administration and implementation 7 of the Medicaid Section 1115 demonstration waiver. 8 42-7.2-16.1. Reinventing Medicaid Act of 2015. 9 (a) Findings. The Rhode Island Medicaid program is an integral component of the state’s 10 healthcare system that provides crucial services and supports to many Rhode Islanders. As the 11 program’s reach has expanded, the costs of the program have continued to rise and the delivery of 12 care has become more fragmented and uncoordinated. Given the crucial role of the Medicaid 13 program to the state, it is of compelling importance that the state conduct a fundamental 14 restructuring of its Medicaid program that achieves measurable improvement in health outcomes 15 for the people and transforms the healthcare system to one that pays for the outcomes and quality 16 they deserve at a sustainable, predictable and affordable cost. The Reinventing Medicaid Act of 17 2015, as implemented in the budget for fiscal year two thousand sixteen (FY2016), involved drastic 18 cuts to the Medicaid program, along with policies that shifted risk to providers away from 19 intermediary insurers. Since the passage of that act, the finances of healthcare providers in Rhode 20 Island have deteriorated significantly, and it is therefore the duty of the general assembly to seek 21 corrective action to restore critical investments in the Medicaid system and redesign payment 22 models to remove risk from providers and concentrate risk in private insurance companies during 23 their phase-out period along the transition to Medicare-for-All. 24 (b) The Working Group to Reinvent Medicaid, which was established to refine the 25 principles and goals of the Medicaid reforms begun in 2008, was directed to present to the general 26 assembly and the governor initiatives to improve the value, quality, and outcomes of the health care 27 funded by the Medicaid program. 28 SECTION 15. Chapter 42-12.1 of the General Laws entitled "Department of Behavioral 29 Healthcare, Developmental Disabilities and Hospitals" is hereby amended by adding thereto the 30 following section: 31 42-12.1-11. The Rhode Island mental health nursing facility. 32 (a) There is hereby established a state nursing facility for the care for Rhode Islanders in 33 need of nursing facility-level inpatient behavioral healthcare known as the Rhode Island mental 34 LC000271 - Page 61 of 93 health nursing facility. The Rhode Island mental health nursing facility shall fall within the purview 1 of the department, and the chief executive officer, chief financial officer, and chief medical officer 2 shall be appointed by the governor with advice and consent of the senate. 3 SECTION 16. Sections 42-12.3-3, 42-12.3-5, 42-12.3-7 and 42-12.3-9 of the General Laws 4 in Chapter 42-12.3 entitled "Health Care for Children and Pregnant Women" are hereby amended 5 to read as follows: 6 42-12.3-3. Medical assistance expansion for pregnancy/RIte Start. 7 (a) The secretary of the executive office of health and human services is authorized to 8 amend its Title XIX state plan pursuant to Title XIX of the Social Security Act to provide Medicaid 9 coverage and to amend its Title XXI state plan pursuant to Title XXI of the Social Security Act to 10 provide medical assistance coverage through expanded family income disregards for pregnant 11 persons whose family income levels are between one hundred eighty-five percent (185%) and two 12 hundred fifty percent (250%) of the federal poverty level. The department is further authorized to 13 promulgate any regulations necessary and in accord with Title XIX [42 U.S.C. § 1396 et seq.] and 14 Title XXI [42 U.S.C. § 1397aa et seq.] of the Social Security Act necessary in order to implement 15 said state plan amendment. The services provided shall be in accord with Title XIX [42 U.S.C. § 16 1396 et seq.] and Title XXI [42 U.S.C. § 1397aa et seq.] of the Social Security Act. 17 (b) The secretary of health and human services is authorized and directed to establish a 18 payor of last resort program to cover prenatal, delivery and postpartum care. The program shall 19 cover the cost of maternity care for any person who lacks health insurance coverage for maternity 20 care and who is not eligible for medical assistance under Title XIX [42 U.S.C. § 1396 et seq.] and 21 Title XXI [42 U.S.C. § 1397aa et seq.] of the Social Security Act including, but not limited to, a 22 noncitizen pregnant person lawfully admitted for permanent residence on or after August 22, 1996, 23 without regard to the availability of federal financial participation, provided such pregnant person 24 satisfies all other eligibility requirements. The secretary shall promulgate regulations to implement 25 this program. Such regulations shall include specific eligibility criteria; the scope of services to be 26 covered; procedures for administration and service delivery; referrals for non-covered services; 27 outreach; and public education. 28 (c) The secretary of health and human services may enter into cooperative agreements with 29 the department of health and/or other state agencies to provide services to individuals eligible for 30 services under subsections (a) and (b) above. 31 (d) The following services shall be provided through the program: 32 (1) Ante-partum and postpartum care; 33 (2) Delivery; 34 LC000271 - Page 62 of 93 (3) Cesarean section; 1 (4) Newborn hospital care; 2 (5) Inpatient transportation from one hospital to another when authorized by a medical 3 provider; and 4 (6) Prescription medications and laboratory tests. 5 (e) The secretary of health and human services shall provide enhanced services, as 6 appropriate, to pregnant persons as defined in subsections (a) and (b), as well as to other pregnant 7 persons eligible for medical assistance. These services shall include: care coordination; nutrition 8 and social service counseling; high-risk obstetrical care; childbirth and parenting preparation 9 programs; smoking cessation programs; outpatient counseling for drug-alcohol use; interpreter 10 services; mental health services; and home visitation. The provision of enhanced services is subject 11 to available appropriations. In the event that appropriations are not adequate for the provision of 12 these services, the executive office has the authority to limit the amount, scope, and duration of 13 these enhanced services. 14 (f) The executive office of health and human services shall provide for extended family 15 planning services for up to twenty-four (24) months postpartum. These services shall be available 16 to persons who have been determined eligible for RIte Start or for medical assistance under Title 17 XIX [42 U.S.C. § 1396 et seq.] or Title XXI [42 U.S.C. § 1397aa et seq.] of the Social Security 18 Act. 19 (g) Effective October 1, 2022, individuals eligible for RIte Start pursuant to this section or 20 for medical assistance under Title XIX or Title XXI of the Social Security Act while pregnant 21 (including during a period of retroactive eligibility), are eligible for full Medicaid benefits through 22 the last day of the month in which their twelve-month (12) postpartum period ends. This benefit 23 will be provided to eligible Rhode Island residents without regard to the availability of federal 24 financial participation. The executive office of health and human services is directed to ensure that 25 federal financial participation is used to the maximum extent allowable to provide coverage 26 pursuant to this section, and that state-only funds will be used only if federal financial participation 27 is not available. 28 (h) Any person eligible for services under subsections (a) and (b) of this section, or 29 otherwise eligible for medical assistance under Title XIX [42 U.S.C. § 1396 et seq.] and Title XXI 30 [42 U.S.C. § 1397aa et seq.] of the Social Security Act, shall also be entitled to services for any 31 termination of pregnancy permitted under § 23-4.13-2; provided, however, that no federal funds 32 shall be used to pay for such services, except as authorized under federal law. 33 42-12.3-5. Managed care. 34 LC000271 - Page 63 of 93 The delivery and financing of the health care services provided pursuant to §§ 42-12.3-3 1 and 42-12.3-4 shall may be provided through a system of managed care. The delivery and financing 2 of the healthcare services provided under this chapter may be provided through a system of 3 managed care. Beginning July 1, 2029, all payments shall be provided directly by the state without 4 an intermediate payment to a managed care entity or other form of health insurance company, 5 unless the intermediate payor is owned by the Medicaid office or another branch of state 6 government. Beginning July 1, 2025, no new contracts may be entered into between the Medicaid 7 office and an intermediate payor such as a managed care entity or other form of health insurance 8 company for the payment of healthcare services pursuant to this chapter, unless the intermediate 9 payor is owned by the Medicaid office or another branch of state government. 10 A managed care system integrates an efficient financing mechanism with quality service 11 delivery, provides a “medical home” to assure appropriate care and deter unnecessary and 12 inappropriate care, and places emphasis on preventive and primary health care. In developing a 13 managed care system the department of human services shall consider managed care models 14 recognized by the health care financing administration. The department of human services is hereby 15 authorized and directed to seek any necessary approvals or waivers from the U.S. Department of 16 Health and Human Services, Health Care Financing Administration, needed to assure that services 17 are provided through a mandatory managed care system. Certain health services may be provided 18 on an interim basis through a fee for service arrangement upon a finding that there are temporary 19 barriers to implementation of mandatory managed care for a particular population or particular 20 geographic area. Nothing in this section shall prohibit the department of human services from 21 providing enhanced services to medical assistance recipients within existing appropriations. 22 42-12.3-7. Financial contributions. 23 The department of human services may not require the payment of enrollment fees, sliding 24 fees, deductibles, co-payments, and/or other contributions based on ability to pay. These fees shall 25 be established by rules and regulations to be promulgated by the department of human services or 26 the department of health, as appropriate. 27 42-12.3-9. Insurance coverage — Third party insurance. 28 (a) No payment will be made nor service provided in the RIte Start or RIte Track program 29 with respect to any health care that is covered or would be covered, by any employee welfare benefit 30 plan under which a woman or child is either covered or eligible to be covered either as an employee 31 or dependent, whether or not coverage under such plan is elected. 32 (b) A premium may be charged for participation in the RIte Track or RIte Start programs 33 for eligible individuals whose family incomes are in excess of two hundred fifty percent (250%) of 34 LC000271 - Page 64 of 93 the federal poverty level and who have voluntarily terminated health care insurance within one year 1 of the date of application for benefits under this chapter. 2 (c)(b) Every family who is eligible to participate in the RIte Track program, who has an 3 additional child who because of age is not eligible for RIte Track, or whose child becomes ineligible 4 for RIte Track because of his or her age, may be offered by the managed care provider with whom 5 the family is enrolled, the opportunity to enroll such ineligible child or children in the same 6 managed care program on a self-pay basis at the same cost, charge or premium as is being charged 7 to the state under the provisions of this chapter for other covered children within the managed care 8 program. The family may also purchase a package of enhanced services at the same cost or charge 9 to the department. 10 SECTION 17. Section 42-12.3-14 of the General Laws in Chapter 42-12.3 entitled "Health 11 Care for Children and Pregnant Women" is hereby repealed. 12 42-12.3-14. Benefits and coverage — Exclusion. 13 For as long as the United States Department of Health and Human Services, Health Care 14 Financing Administration Project No. 11-W-0004/1-01 entitled “RIte Care” remains in effect, any 15 health care services provided pursuant to this chapter shall be exempt from all mandatory benefits 16 and coverage as may otherwise be provided for in the general laws. 17 SECTION 18. Sections 42-14.5-2 and 42-14.5-3 of the General Laws in Chapter 42-14.5 18 entitled "The Rhode Island Health Care Reform Act of 2004 — Health Insurance Oversight" are 19 hereby amended to read as follows: 20 42-14.5-2. Purpose. 21 With respect to health insurance as defined in § 42-14-5, the health insurance commissioner 22 shall discharge the powers and duties of office to: 23 (1) Guard the solvency of health insurers Claw back excessive profits, reserves charges, 24 and other monies that health insurers may have accumulated against the public interest of the people 25 of Rhode Island; 26 (2) Protect the interests of consumers; 27 (3) Encourage fair treatment of health care providers; 28 (4) Encourage policies and developments that improve the quality and efficiency of health 29 care service delivery and outcomes; and 30 (5) View the health care system as a comprehensive entity and encourage and direct 31 insurers towards policies that advance the welfare of the public through overall efficiency, 32 improved health care quality, and appropriate access; and 33 (6) Facilitate the transformation of the healthcare payments system to a state-level 34 LC000271 - Page 65 of 93 Medicare-for-All system. 1 42-14.5-3. Powers and duties. 2 The health insurance commissioner shall have the following powers and duties: 3 (a) To conduct quarterly public meetings throughout the state, separate and distinct from 4 rate hearings pursuant to § 42-62-13, regarding the rates, services, and operations of insurers 5 licensed to provide health insurance in the state; the effects of such rates, services, and operations 6 on consumers, medical care providers, patients, and the market environment in which the insurers 7 operate; and efforts to bring new health insurers into the Rhode Island market. Notice of not less 8 than ten (10) days of the hearing(s) shall go to the general assembly, the governor, the Rhode Island 9 Medical Society, the Hospital Association of Rhode Island, the director of health, the attorney 10 general, and the chambers of commerce. Public notice shall be posted on the department’s website 11 and given in the newspaper of general circulation, and to any entity in writing requesting notice. 12 (b) To make recommendations to the governor and the house of representatives and senate 13 finance committees regarding healthcare insurance and the regulations, rates, services, 14 administrative expenses, reserve requirements, and operations of insurers providing health 15 insurance in the state, and to prepare or comment on, upon the request of the governor or 16 chairpersons of the house or senate finance committees, draft legislation to improve the regulation 17 of health insurance. In making the recommendations, the commissioner shall recognize that it is 18 the intent of the legislature that the maximum disclosure be provided regarding the reasonableness 19 of individual administrative expenditures as well as total administrative costs. The commissioner 20 shall make recommendations on the levels of reserves, including consideration of: targeted reserve 21 levels; trends in the increase or decrease of reserve levels; and insurer plans for distributing excess 22 reserves. 23 (c) To establish a consumer/business/labor/medical advisory council to obtain information 24 and present concerns of consumers, business, and medical providers affected by health insurance 25 decisions. The council shall develop proposals to allow the market for small business health 26 insurance to be affordable and fairer. The council shall be involved in the planning and conduct of 27 the quarterly public meetings in accordance with subsection (a). The advisory council shall develop 28 measures to inform small businesses of an insurance complaint process to ensure that small 29 businesses that experience rate increases in a given year may request and receive a formal review 30 by the department. The advisory council shall assess views of the health provider community 31 relative to insurance rates of reimbursement, billing, and reimbursement procedures, and the 32 insurers’ role in promoting efficient and high-quality health care. The advisory council shall issue 33 an annual report of findings and recommendations to the governor and the general assembly and 34 LC000271 - Page 66 of 93 present its findings at hearings before the house and senate finance committees. The advisory 1 council is to be diverse in interests and shall include representatives of community consumer 2 organizations; small businesses, other than those involved in the sale of insurance products; and 3 hospital, medical, and other health provider organizations. Such representatives shall be nominated 4 by their respective organizations. The advisory council shall be co-chaired by the health insurance 5 commissioner and a community consumer organization or small business member to be elected by 6 the full advisory council. 7 (d) To establish and provide guidance and assistance to a subcommittee (“the professional- 8 provider-health-plan work group”) of the advisory council created pursuant to subsection (c), 9 composed of healthcare providers and Rhode Island licensed health plans. This subcommittee The 10 health commissioner shall include provide in its annual report and presentation before the house 11 and senate finance committees the following information: 12 (1) A method whereby health plans shall disclose to contracted providers the fee schedules 13 used to provide payment to those providers for services rendered to covered patients; 14 (2) A standardized provider application and credentials verification process, for the 15 purpose of verifying professional qualifications of participating healthcare providers; 16 (3) The uniform health plan claim form utilized by participating providers; 17 (4) Methods for health maintenance organizations, as defined by § 27-41-2, and nonprofit 18 hospital or medical service corporations, as defined by chapters 19 and 20 of title 27, to make 19 facility-specific data and other medical service-specific data available in reasonably consistent 20 formats to patients regarding quality and costs. This information would help consumers make 21 informed choices regarding the facilities and clinicians or physician practices at which to seek care. 22 Among the items considered would be the unique health services and other public goods provided 23 by facilities and clinicians or physician practices in establishing the most appropriate cost 24 comparisons; 25 (5) All activities related to contractual disclosure to participating providers of the 26 mechanisms for resolving health plan/provider disputes; 27 (6) The uniform process being utilized for confirming, in real time, patient insurance 28 enrollment status, benefits coverage, including copays and deductibles; 29 (7) Information related to temporary credentialing of providers seeking to participate in the 30 plan’s network and the impact of the activity on health plan accreditation; 31 (8) The feasibility of regular contract renegotiations between plans and the providers in 32 their networks; and 33 (9) Efforts conducted related to reviewing impact of silent PPOs on physician practices. 34 LC000271 - Page 67 of 93 (e) To enforce the provisions of title 27 and title 42 as set forth in § 42-14-5(d). 1 (f) To provide analysis of the Rhode Island affordable health plan reinsurance fund. The 2 fund shall be used to effectuate the provisions of §§ 27-18.5-9 and 27-50-17. 3 (g) To analyze the impact of changing the rating guidelines and/or merging the individual 4 health insurance market, as defined in chapter 18.5 of title 27, and the small-employer health 5 insurance market, as defined in chapter 50 of title 27, in accordance with the following: 6 (1) The analysis shall forecast the likely rate increases required to effect the changes 7 recommended pursuant to the preceding subsection (g) in the direct-pay market and small-employer 8 health insurance market over the next five (5) years, based on the current rating structure and 9 current products. 10 (2) The analysis shall include examining the impact of merging the individual and small- 11 employer markets on premiums charged to individuals and small-employer groups. 12 (3) The analysis shall include examining the impact on rates in each of the individual and 13 small-employer health insurance markets and the number of insureds in the context of possible 14 changes to the rating guidelines used for small-employer groups, including: community rating 15 principles; expanding small-employer rate bonds beyond the current range; increasing the employer 16 group size in the small-group market; and/or adding rating factors for broker and/or tobacco use. 17 (4) The analysis shall include examining the adequacy of current statutory and regulatory 18 oversight of the rating process and factors employed by the participants in the proposed, new 19 merged market. 20 (5) The analysis shall include assessment of possible reinsurance mechanisms and/or 21 federal high-risk pool structures and funding to support the health insurance market in Rhode Island 22 by reducing the risk of adverse selection and the incremental insurance premiums charged for this 23 risk, and/or by making health insurance affordable for a selected at-risk population. 24 (6) The health insurance commissioner shall work with an insurance market merger task 25 force to assist with the analysis. The task force shall be chaired by the health insurance 26 commissioner and shall include, but not be limited to, representatives of the general assembly, the 27 business community, small-employer carriers as defined in § 27-50-3, carriers offering coverage in 28 the individual market in Rhode Island, health insurance brokers, and members of the general public. 29 (7) For the purposes of conducting this analysis, the commissioner may contract with an 30 outside organization with expertise in fiscal analysis of the private insurance market. In conducting 31 its study, the organization shall, to the extent possible, obtain and use actual health plan data. Said 32 data shall be subject to state and federal laws and regulations governing confidentiality of health 33 care and proprietary information. 34 LC000271 - Page 68 of 93 (8) The task force shall meet as necessary and include its findings in the annual report, and 1 the commissioner shall include the information in the annual presentation before the house and 2 senate finance committees. 3 (h) To establish and convene a workgroup representing healthcare providers and health 4 insurers for the purpose of coordinating the development of processes, guidelines, and standards to 5 streamline healthcare administration that are to be adopted by payors and providers of healthcare 6 services operating in the state. This workgroup shall include representatives with expertise who 7 would contribute to the streamlining of healthcare administration and who are selected from 8 hospitals, physician practices, community behavioral health organizations, each health insurer, 9 labor union representing healthcare workers, and other affected entities. The workgroup shall also 10 include at least one designee each from the Rhode Island Medical Society, Rhode Island Council 11 of Community Mental Health Organizations, the Rhode Island Health Center Association, and the 12 Hospital Association of Rhode Island. In any year that the workgroup meets and submits 13 recommendations to the office of the health insurance commissioner, the office of the health 14 insurance commissioner shall submit such recommendations to the health and human services 15 committees of the Rhode Island house of representatives and the Rhode Island senate prior to the 16 implementation of any such recommendations and subsequently shall submit a report to the general 17 assembly by June 30, 2024. The report shall include the recommendations the commissioner may 18 implement, with supporting rationale. The workgroup shall consider and make recommendations 19 for: 20 (1) Establishing a consistent standard for electronic eligibility and coverage verification. 21 Such standard shall: 22 (i) Include standards for eligibility inquiry and response and, wherever possible, be 23 consistent with the standards adopted by nationally recognized organizations, such as the Centers 24 for Medicare & Medicaid Services; 25 (ii) Enable providers and payors to exchange eligibility requests and responses on a system- 26 to-system basis or using a payor-supported web browser; 27 (iii) Provide reasonably detailed information on a consumer’s eligibility for healthcare 28 coverage; scope of benefits; limitations and exclusions provided under that coverage; cost-sharing 29 requirements for specific services at the specific time of the inquiry; current deductible amounts; 30 accumulated or limited benefits; out-of-pocket maximums; any maximum policy amounts; and 31 other information required for the provider to collect the patient’s portion of the bill; 32 (iv) Reflect the necessary limitations imposed on payors by the originator of the eligibility 33 and benefits information; 34 LC000271 - Page 69 of 93 (v) Recommend a standard or common process to protect all providers from the costs of 1 services to patients who are ineligible for insurance coverage in circumstances where a payor 2 provides eligibility verification based on best information available to the payor at the date of the 3 request of eligibility. 4 (2) Developing implementation guidelines and promoting adoption of the guidelines for: 5 (i) The use of the National Correct Coding Initiative code-edit policy by payors and 6 providers in the state; 7 (ii) Publishing any variations from codes and mutually exclusive codes by payors in a 8 manner that makes for simple retrieval and implementation by providers; 9 (iii) Use of Health Insurance Portability and Accountability Act standard group codes, 10 reason codes, and remark codes by payors in electronic remittances sent to providers; 11 (iv) Uniformity in the processing of claims by payors; and the processing of corrections to 12 claims by providers and payors; 13 (v) A standard payor-denial review process for providers when they request a 14 reconsideration of a denial of a claim that results from differences in clinical edits where no single, 15 common-standards body or process exists and multiple conflicting sources are in use by payors and 16 providers. 17 (vi) Nothing in this section, nor in the guidelines developed, shall inhibit an individual 18 payor’s ability to employ, and not disclose to providers, temporary code edits for the purpose of 19 detecting and deterring fraudulent billing activities. The guidelines shall require that each payor 20 disclose to the provider its adjudication decision on a claim that was denied or adjusted based on 21 the application of such edits and that the provider have access to the payor’s review and appeal 22 process to challenge the payor’s adjudication decision. 23 (vii) Nothing in this subsection shall be construed to modify the rights or obligations of 24 payors or providers with respect to procedures relating to the investigation, reporting, appeal, or 25 prosecution under applicable law of potentially fraudulent billing activities. 26 (3) Developing and promoting widespread adoption by payors and providers of guidelines 27 to: 28 (i) Ensure payors do not automatically deny claims for services when extenuating 29 circumstances make it impossible for the provider to obtain a preauthorization before services are 30 performed or notify a payor within an appropriate standardized timeline of a patient’s admission; 31 (ii) Require payors to use common and consistent processes and time frames when 32 responding to provider requests for medical management approvals. Whenever possible, such time 33 frames shall be consistent with those established by leading national organizations and be based 34 LC000271 - Page 70 of 93 upon the acuity of the patient’s need for care or treatment. For the purposes of this section, medical 1 management includes prior authorization of services, preauthorization of services, precertification 2 of services, post-service review, medical-necessity review, and benefits advisory; 3 (iii) Develop, maintain, and promote widespread adoption of a single, common website 4 where providers can obtain payors’ preauthorization, benefits advisory, and preadmission 5 requirements; 6 (iv) Establish guidelines for payors to develop and maintain a website that providers can 7 use to request a preauthorization, including a prospective clinical necessity review; receive an 8 authorization number; and transmit an admission notification; 9 (v) Develop and implement the use of programs that implement selective prior 10 authorization requirements, based on stratification of healthcare providers’ performance and 11 adherence to evidence-based medicine with the input of contracted healthcare providers and/or 12 provider organizations. Such criteria shall be transparent and easily accessible to contracted 13 providers. Such selective prior authorization programs shall be available when healthcare providers 14 participate directly with the insurer in risk-based payment contracts and may be available to 15 providers who do not participate in risk-based contracts; 16 (vi) Require the review of medical services, including behavioral health services, and 17 prescription drugs, subject to prior authorization on at least an annual basis, with the input of 18 contracted healthcare providers and/or provider organizations. Any changes to the list of medical 19 services, including behavioral health services, and prescription drugs requiring prior authorization, 20 shall be shared via provider-accessible websites; 21 (vii) Improve communication channels between health plans, healthcare providers, and 22 patients by: 23 (A) Requiring transparency and easy accessibility of prior authorization requirements, 24 criteria, rationale, and program changes to contracted healthcare providers and patients/health plan 25 enrollees which may be satisfied by posting to provider-accessible and member-accessible 26 websites; and 27 (B) Supporting: 28 (I) Timely submission by healthcare providers of the complete information necessary to 29 make a prior authorization determination, as early in the process as possible; and 30 (II) Timely notification of prior authorization determinations by health plans to impacted 31 health plan enrollees, and healthcare providers, including, but not limited to, ordering providers, 32 and/or rendering providers, and dispensing pharmacists which may be satisfied by posting to 33 provider-accessible websites or similar electronic portals or services; 34 LC000271 - Page 71 of 93 (viii) Increase and strengthen continuity of patient care by: 1 (A) Defining protections for continuity of care during a transition period for patients 2 undergoing an active course of treatment, when there is a formulary or treatment coverage change 3 or change of health plan that may disrupt their current course of treatment and when the treating 4 physician determines that a transition may place the patient at risk; and for prescription medication 5 by allowing a grace period of coverage to allow consideration of referred health plan options or 6 establishment of medical necessity of the current course of treatment; 7 (B) Requiring continuity of care for medical services, including behavioral health services, 8 and prescription medications for patients on appropriate, chronic, stable therapy through 9 minimizing repetitive prior authorization requirements; and which for prescription medication shall 10 be allowed only on an annual review, with exception for labeled limitation, to establish continued 11 benefit of treatment; and 12 (C) Requiring communication between healthcare providers, health plans, and patients to 13 facilitate continuity of care and minimize disruptions in needed treatment which may be satisfied 14 by posting to provider-accessible websites or similar electronic portals or services; 15 (D) Continuity of care for formulary or drug coverage shall distinguish between FDA 16 designated interchangeable products and proprietary or marketed versions of a medication; 17 (ix) Encourage healthcare providers and/or provider organizations and health plans to 18 accelerate use of electronic prior authorization technology, including adoption of national standards 19 where applicable; and 20 (x) For the purposes of subsections (h)(3)(v) through (h)(3)(x) of this section, the 21 workgroup meeting may be conducted in part or whole through electronic methods. 22 (4) To provide a report to the house and senate, on or before January 1, 2017, with 23 recommendations for establishing guidelines and regulations for systems that give patients 24 electronic access to their claims information, particularly to information regarding their obligations 25 to pay for received medical services, pursuant to 45 C.F.R. § 164.524. 26 (5) No provision of this subsection (h) shall preclude the ongoing work of the office of 27 health insurance commissioner’s administrative simplification task force, which includes meetings 28 with key stakeholders in order to improve, and provide recommendations regarding, the prior 29 authorization process. 30 (i) To issue an anti-cancer medication report. Not later than June 30, 2014, and annually 31 thereafter, the office of the health insurance commissioner (OHIC) shall provide the senate 32 committee on health and human services, and the house committee on corporations, with: (1) 33 Information on the availability in the commercial market of coverage for anti-cancer medication 34 LC000271 - Page 72 of 93 options; (2) For the state employee’s health benefit plan, the costs of various cancer-treatment 1 options; (3) The changes in drug prices over the prior thirty-six (36) months; and (4) Member 2 utilization and cost-sharing expense. 3 (j) To monitor the adequacy of each health plan’s compliance with the provisions of the 4 federal Mental Health Parity Act, including a review of related claims processing and 5 reimbursement procedures. Findings, recommendations, and assessments shall be made available 6 to the public. 7 (k) To monitor the prevent by regulation transition from fee-for-service and toward global 8 and other alternative payment methodologies for the payment for healthcare services that the health 9 insurance commissioner shall deem against the interest of public health. The health insurance 10 commissioner shall have no power to impose, encourage, or in any way incentivize any rate caps, 11 global budgets, episode-based payments, or capitation structures in the payment models utilized in 12 contracts between health insurers and providers. Alternative payment methodologies should be 13 assessed for their likelihood to promote damage access to affordable health insurance care, health 14 outcomes, and performance. 15 (l) To report annually, no later than July 1, 2014, then biannually thereafter, on hospital 16 payment variation, including findings and recommendations, subject to available resources. 17 (m) Notwithstanding any provision of the general or public laws or regulation to the 18 contrary, provide a report with findings and recommendations to the president of the senate and the 19 speaker of the house, on or before April 1, 2014, including, but not limited to, the following 20 information: 21 (1) The impact of the current, mandated healthcare benefits as defined in §§ 27-18-48.1, 22 27-18-60, 27-18-62, 27-18-64, similar provisions in chapters 19, 20 and 41 of title 27, and §§ 27- 23 18-3(c), 27-38.2-1 et seq., or others as determined by the commissioner, on the cost of health 24 insurance for fully insured employers, subject to available resources; 25 (2) Current provider and insurer mandates that are unnecessary and/or duplicative due to 26 the existing standards of care and/or delivery of services in the healthcare system; 27 (3) A state-by-state comparison of health insurance mandates and the extent to which 28 Rhode Island mandates exceed other states benefits; and 29 (4) Recommendations for amendments to existing mandated benefits based on the findings 30 in (m)(1), (m)(2), and (m)(3) above. 31 (n) On or before July 1, 2014, the office of the health insurance commissioner, in 32 collaboration with the director of health and lieutenant governor’s office, shall submit a report to 33 the general assembly and the governor to inform the design of accountable care organizations 34 LC000271 - Page 73 of 93 (ACOs) in Rhode Island as unique structures for comprehensive healthcare delivery and value- 1 based payment arrangements, that shall include, but not be limited to: 2 (1) Utilization review; 3 (2) Contracting; and 4 (3) Licensing and regulation. 5 (o) On or before February 3, 2015, the office of the health insurance commissioner shall 6 submit a report to the general assembly and the governor that describes, analyzes, and proposes 7 recommendations to improve compliance of insurers with the provisions of § 27-18-76 with regard 8 to patients with mental health and substance use disorders. 9 (p) To work to ensure the health insurance coverage of behavioral health care under the 10 same terms and conditions as other health care, and to integrate behavioral health parity 11 requirements into the office of the health insurance commissioner insurance oversight and 12 healthcare transformation efforts. 13 (q) To work with other state agencies to seek delivery system improvements that enhance 14 access to a continuum of mental health and substance use disorder treatment in the state; and 15 integrate that treatment with primary and other medical care to the fullest extent possible. 16 (r) To direct insurers toward policies and practices that address the behavioral health needs 17 of the public and greater integration of physical and behavioral healthcare delivery. 18 (s) The office of the health insurance commissioner shall conduct an analysis of the impact 19 of the provisions of § 27-38.2-1(i) on health insurance premiums and access in Rhode Island and 20 submit a report of its findings to the general assembly on or before June 1, 2023. 21 (t) To undertake the analyses, reports, and studies contained in this section: 22 (1) The office shall hire the necessary staff and prepare a request for proposal for a qualified 23 and competent firm or firms to undertake the following analyses, reports, and studies: 24 (i) The firm shall undertake a comprehensive review of all social and human service 25 programs having a contract with or licensed by the state or any subdivision of the department of 26 children, youth and families (DCYF), the department of behavioral healthcare, developmental 27 disabilities and hospitals (BHDDH), the department of human services (DHS), the department of 28 health (DOH), and Medicaid for the purposes of: 29 (A) Establishing a baseline of the eligibility factors for receiving services; 30 (B) Establishing a baseline of the service offering through each agency for those 31 determined eligible; 32 (C) Establishing a baseline understanding of reimbursement rates for all social and human 33 service programs including rates currently being paid, the date of the last increase, and a proposed 34 LC000271 - Page 74 of 93 model that the state may use to conduct future studies and analyses; 1 (D) Ensuring accurate and adequate reimbursement to social and human service providers 2 that facilitate the availability of high-quality services to individuals receiving home and 3 community-based long-term services and supports provided by social and human service providers; 4 (E) Ensuring the general assembly is provided accurate financial projections on social and 5 human service program costs, demand for services, and workforce needs to ensure access to entitled 6 beneficiaries and services; 7 (F) Establishing a baseline and determining the relationship between state government and 8 the provider network including functions, responsibilities, and duties; 9 (G) Determining a set of measures and accountability standards to be used by EOHHS and 10 the general assembly to measure the outcomes of the provision of services including budgetary 11 reporting requirements, transparency portals, and other methods; and 12 (H) Reporting the findings of human services analyses and reports to the speaker of the 13 house, senate president, chairs of the house and senate finance committees, chairs of the house and 14 senate health and human services committees, and the governor. 15 (2) The analyses, reports, and studies required pursuant to this section shall be 16 accomplished and published as follows and shall provide: 17 (i) An assessment and detailed reporting on all social and human service program rates to 18 be completed by January 1, 2023, including rates currently being paid and the date of the last 19 increase; 20 (ii) An assessment and detailed reporting on eligibility standards and processes of all 21 mandatory and discretionary social and human service programs to be completed by January 1, 22 2023; 23 (iii) An assessment and detailed reporting on utilization trends from the period of January 24 1, 2017, through December 31, 2021, for social and human service programs to be completed by 25 January 1, 2023; 26 (iv) An assessment and detailed reporting on the structure of the state government as it 27 relates to the provision of services by social and human service providers including eligibility and 28 functions of the provider network to be completed by January 1, 2023; 29 (v) An assessment and detailed reporting on accountability standards for services for social 30 and human service programs to be completed by January 1, 2023; 31 (vi) An assessment and detailed reporting by April 1, 2023, on all professional licensed 32 and unlicensed personnel requirements for established rates for social and human service programs 33 pursuant to a contract or established fee schedule; 34 LC000271 - Page 75 of 93 (vii) An assessment and reporting on access to social and human service programs, to 1 include any wait lists and length of time on wait lists, in each service category by April 1, 2023; 2 (viii) An assessment and reporting of national and regional Medicaid rates in comparison 3 to Rhode Island social and human service provider rates by April 1, 2023; 4 (ix) An assessment and reporting on usual and customary rates paid by private insurers and 5 private pay for similar social and human service providers, both nationally and regionally, by April 6 1, 2023; and 7 (x) Completion of the development of an assessment and review process that includes the 8 following components: eligibility; scope of services; relationship of social and human service 9 provider and the state; national and regional rate comparisons and accountability standards that 10 result in recommended rate adjustments; and this process shall be completed by September 1, 2023, 11 and conducted biennially hereafter. The biennial rate setting shall be consistent with payment 12 requirements established in § 1902(a)(30)(A) of the Social Security Act, 42 U.S.C. § 13 1396a(a)(30)(A), and all federal and state law, regulations, and quality and safety standards. The 14 results and findings of this process shall be transparent, and public meetings shall be conducted to 15 allow providers, recipients, and other interested parties an opportunity to ask questions and provide 16 comment beginning in September 2023 and biennially thereafter. 17 (3) In fulfillment of the responsibilities defined in subsection (t), the office of the health 18 insurance commissioner shall consult with the Executive Office of Health and Human Services. 19 (u) Annually, each department (namely, EOHHS, DCYF, DOH, DHS, and BHDDH) shall 20 include the corresponding components of the assessment and review (i.e., eligibility; scope of 21 services; relationship of social and human service provider and the state; and national and regional 22 rate comparisons and accountability standards including any changes or substantive issues between 23 biennial reviews) including the recommended rates from the most recent assessment and review 24 with their annual budget submission to the office of management and budget and provide a detailed 25 explanation and impact statement if any rate variances exist between submitted recommended 26 budget and the corresponding recommended rate from the most recent assessment and review 27 process starting October 1, 2023, and biennially thereafter. 28 (v) The general assembly shall appropriate adequate funding as it deems necessary to 29 undertake the analyses, reports, and studies contained in this section relating to the powers and 30 duties of the office of the health insurance commissioner. 31 (w) To approve or deny any compensation of employees of health insurers subject to the 32 laws of the State of Rhode Island in excess of one million dollars ($1,000,000) per employee. 33 (x) To approve or deny dividends of stock buybacks of health insurers subject to the laws 34 LC000271 - Page 76 of 93 of the State of Rhode Island. 1 SECTION 19. Section 44-17-1 of the General Laws in Chapter 44-17 entitled "Taxation of 2 Insurance Companies" is hereby amended to read as follows: 3 44-17-1. Companies required to file — Payment of tax — Retaliatory rates. 4 (a) Every domestic, foreign, or alien insurance company, mutual association, organization, 5 or other insurer, including any health maintenance organization as defined in § 27-41-2, any 6 medical malpractice insurance joint underwriters association as defined in § 42-14.1-1, any 7 nonprofit dental service corporation as defined in § 27-20.1-2 and any nonprofit hospital or medical 8 service corporation as defined in chapters 19 and 20 of title 27, except companies mentioned in § 9 44-17-6 and organizations defined in § 27-25-1, transacting business in this state, shall, on or before 10 April 15 in each year, file with the tax administrator, in the form that he or she may prescribe, a 11 return under oath or affirmation signed by a duly authorized officer or agent of the company, 12 containing information that may be deemed necessary for the determination of the tax imposed by 13 this chapter, and shall at the same time pay an annual tax to the tax administrator of two percent 14 (2%) three percent (3%) of the gross premiums on contracts of insurance and six percent (6%) of 15 all Medicaid payments received by an insurance company, except for ocean marine insurance as 16 referred to in § 44-17-6, covering property and risks within the state, written during the calendar 17 year ending December 31st next preceding. 18 (b) Qualifying insurers for purposes of this section means every domestic, foreign, or alien 19 insurance company, mutual association, organization, or other insurer and excludes: 20 (1) Health maintenance organizations, as defined in § 27-41-2; 21 (2) Nonprofit dental service corporations, as defined in § 27-20.1-2; and 22 (3) Nonprofit hospital or medical service corporations, as defined in §§ 27-19-1 and 27- 23 20-1. 24 (c) For tax years 2018 and thereafter, the rate of taxation may be reduced as set forth below 25 and, if so reduced, shall be fully applicable to qualifying insurers instead of the two percent (2%) 26 rate listed in subsection (a). In the case of foreign or alien companies, except as provided in § 27- 27 2-17(d), the tax shall not be less in amount than is imposed by the laws of the state or country under 28 which the companies are organized upon like companies incorporated in this state or upon its 29 agents, if doing business to the same extent in the state or country. The tax rate shall not be reduced 30 for gross premiums written on contracts of health insurance as defined in § 42-14-5(c) but shall 31 remain at two percent (2%) three percent (3%) or the appropriate retaliatory tax rate, whichever is 32 higher. 33 (d) For qualifying insurers, the premium tax rate may be decreased based upon Rhode 34 LC000271 - Page 77 of 93 Island jobs added by the industry as detailed below: 1 (1) A committee shall be established for the purpose of implementing tax rates using the 2 framework established herein. The committee shall be comprised of the following persons or their 3 designees: the secretary of commerce, the director of the department of business regulation, the 4 director of the department of revenue, and the director of the office of management and budget. No 5 rule may be issued pursuant to this section without the prior, unanimous approval of the committee; 6 (2) On the timetable listed below, the committee shall determine whether qualifying 7 insurers have added new qualifying jobs in this state in the preceding calendar year. A qualifying 8 job for purposes of this section is any employee with total annual wages equal to or greater than 9 forty percent (40%) of the average annual wages of the Rhode Island insurance industry, as 10 published by the annual employment and wages report of the Rhode Island department of labor and 11 training, in NAICS code 5241; 12 (3) If the committee determines that there has been a sufficient net increase in qualifying 13 jobs in the preceding calendar year(s) to offset a material reduction in the premium tax, it shall 14 calculate a reduced premium tax rate. Such rate shall be determined via a method selected by the 15 committee and designed such that the estimated personal income tax generated by the increase in 16 qualifying jobs is at least one hundred and twenty-five percent (125%) of the anticipated reduction 17 in premium tax receipts resulting from the new rate. For purposes of this calculation, the committee 18 may consider personal income tax withholdings or receipts, but in no event may the committee 19 include for the purposes of determining revenue neutrality income taxes that are subject to 20 segregation pursuant to § 44-48.3-8(f) or that are otherwise available to the general fund; 21 (4) Any reduced rate established pursuant to this section must be established in a 22 rulemaking proceeding pursuant to chapter 35 of title 42, subject to the following conditions: 23 (i) Any net increase in qualifying jobs and the resultant premium tax reduction and revenue 24 impact shall be determined in any rulemaking proceeding conducted under this section and shall 25 be set forth in a report included in the rulemaking record, which report shall also include a 26 description of the data sources and calculation methods used. The first such report shall also include 27 a calculation of the baseline level of employment of qualifying insurers for the calendar year 2015; 28 and 29 (ii) Notwithstanding any provision of the law to the contrary, no rule changing the tax rate 30 shall take effect until one hundred and twenty (120) days after notice of the rate change is provided 31 to the speaker of the house, the president of the senate, the house and senate fiscal advisors, and 32 the auditor general, which notice shall include the report required under the preceding provision. 33 (5) For each of the first three (3) rulemaking proceedings required under this section, the 34 LC000271 - Page 78 of 93 tax rate may remain unchanged or be decreased consistent with the requirements of this section, 1 but may not be increased. These first three (3) rulemaking proceedings shall be conducted by the 2 division of taxation and occur in the following manner: 3 (i) The first rulemaking proceeding shall take place in calendar year 2017. This proceeding 4 shall establish a rule that sets forth: (A) A new premium tax rate, if allowed under the requirements 5 of this section, which rate shall take effect in 2018, and (B) A method for calculating the number 6 of jobs at qualifying insurers; 7 (ii) The second rulemaking proceeding shall take place in calendar year 2018. This 8 proceeding shall establish a rule that sets forth: (A) A new premium tax rate, if allowed under the 9 requirements of this section, which rate shall take effect in 2019, and (B) The changes, if any, to 10 the method for calculating the number of jobs at qualifying insurers; and 11 (iii) The third rulemaking proceeding shall take place in calendar year 2019. This 12 proceeding shall establish a rule that sets forth: (A) A new premium tax rate, if allowed under the 13 requirements of this section, which rate shall take effect in 2020, and (B) The changes, if any, to 14 the method for calculating the number of jobs at qualifying insurers. 15 (6) The tax rate established in the regulation following regulatory proceedings that take 16 place in 2019 shall remain in effect through and including 2023. In calendar year 2023, the 17 department of business regulation will conduct a rulemaking proceeding and issue a rule that sets 18 forth: (A) A new premium tax rate, if allowed under the requirements of this section, which rate 19 shall take effect in 2024, and (B) The changes, if any, to the method for calculating the number of 20 jobs at qualifying insurers. A rule issued by the department of business regulation may decrease 21 the tax rate if the requirements for a rate reduction contained in this section are met, or it may 22 increase the tax rate to the extent necessary to achieve the overall revenue level sought when the 23 then-existing tax rate was established. Any rate established shall be no lower than one percent (1%) 24 and no higher than two percent (2%). This proceeding shall be repeated every three (3) calendar 25 years thereafter, however, the base for determination of job increases or decreases shall remain the 26 number of jobs existing during calendar year 2022; 27 (7) No reduction in the premium tax rate pursuant to this section shall be allowed absent a 28 determination that qualifying insurers have added in this state at least three hundred fifty (350) 29 new, full-time, qualifying jobs above the baseline level of employment of qualifying insurers for 30 the calendar year 2015; 31 (8) Notwithstanding any provision of this section to the contrary, the premium tax rate shall 32 never be set lower than one percent (1%); 33 (9) The division of taxation may adopt implementation guidelines, directives, criteria, rules 34 LC000271 - Page 79 of 93 and regulations pursuant to chapter 35 of title 42 as are necessary to implement this section; and 1 (10) The calculation of revenue impacts under this section is at the sole discretion of the 2 committee established under subsection (d)(1). Notwithstanding any provision of law to the 3 contrary, any administrative action or rule setting a tax rate pursuant to this section or failing or 4 declining to alter a tax rate pursuant to this section shall not be subject to judicial review under 5 chapter 35 of title 42. 6 (d) The department of revenue shall calculate the impacts of changes made to Medicaid 7 taking effect during or after fiscal year two thousand twenty-six (FY2026) on state funds, excluding 8 increased federal reimbursements, hereinafter the "Medicaid adjustment." Should the Medicaid 9 adjustment exceed the revenue impact of raising the gross premiums tax rate from two percent (2%) 10 to three percent (3%), hereinafter the "insurance premium tax rate adjustment revenue bonus," a 11 surtax shall be imposed on gross premiums written on contracts of health insurance as defined in § 12 42-14-5(c) at the rate that shall raise aggregate revenue equal to the Medicaid adjustment minus 13 the insurance premium tax rate adjustment revenue bonus. 14 SECTION 20. Section 44-51-3 of the General Laws in Chapter 44-51 entitled "Nursing 15 Facility Provider Assessment Act" is hereby amended to read as follows: 16 44-51-3. Imposition of assessment — Nursing facilities. 17 (a) For purposes of this section, a “nursing facility” means a person or governmental unit 18 licensed in accordance with chapter 17 of title 23 to establish, maintain, and operate a nursing 19 facility. 20 (b) An assessment is imposed upon the gross patient revenue received by every nursing 21 facility in each month beginning January 1, 2008, at a rate of five and one-half percent (5.5%) six 22 percent (6%) for services provided on or after January 1, 2008. Every provider shall pay the 23 monthly assessment no later than the twenty-fifth (25th) day of each month following the month of 24 receipt of gross patient revenue. 25 (c) The assessment imposed by this section shall be repealed on the effective date of the 26 repeal or a restricted amendment of those provisions of the Medicaid Voluntary Contribution and 27 Provider-Specific Tax Amendments of 1991 (P.L. 102-234) that permit federal financial 28 participation to match state funds generated by taxes. 29 (d) If, after applying the applicable federal law and/or rules, regulations, or standards 30 relating to health care providers, the tax administrator determines that the assessment rate 31 established in subsection (b) of this section exceeds the maximum rate of assessment that federal 32 law will allow without reduction in federal financial participation, then the tax administrator is 33 directed to reduce the assessment to a rate equal to the maximum rate which the federal law will 34 LC000271 - Page 80 of 93 allow without reduction in federal participation. Provided, however, that the authority of the tax 1 administrator to lower the assessment rate established in subsection (b) of this section shall be 2 limited solely to such determination. 3 (e) In order that the tax administrator may properly carry out his/her responsibilities under 4 this section, the director of the department of human services shall notify the tax administrator of 5 any damages in federal law and/or any rules, regulations, or standards which affect any rates for 6 health care provider assessments. 7 SECTION 21. Title 44 of the General Laws entitled "TAXATION" is hereby amended by 8 adding thereto the following chapter: 9 CHAPTER 72 10 PRIVATE HEALTHCARE PROVIDERS ASSESSMENT ACT 11 44-72-1. Short title. 12 This chapter shall be known and may be cited as the "Private HealthCare Providers 13 Assessment Act." 14 44-72-2. Definitions. 15 Except where the context otherwise requires, the following words and phrases as used in 16 this chapter shall have the following meaning: 17 (1) "Administrator" means the tax administrator. 18 (2) "Assessment" means the assessment imposed upon gross patient revenue pursuant to 19 this chapter. 20 (3) "Eligible provider" means a privately operated healthcare facility, which is eligible for 21 taxation up to six percent (6%) of gross patient revenue pursuant to 42 CFR 433.68. Nursing 22 facilities taxed pursuant to § 44-51-3 and hospital facilities taxed pursuant to § 23-17-38.1 shall not 23 be considered providers subject to taxation under this chapter. 24 (4) "Gross patient revenue" means the gross amount received on a cash basis by the 25 provider from all patient care services. Charitable contributions, donated goods and services, fund 26 raising proceeds, endowment support, income from meals on wheels, income from investments, 27 and other nonpatient revenues defined by the tax administrator upon the recommendation of the 28 department of human services shall not be considered as "gross patient revenue". 29 (5) "Person" means any individual, corporation, company, association, partnership, joint 30 stock association, and the legal successor thereof. 31 44-72-3. Imposition of assessment. 32 (a) An assessment is imposed upon the gross patient revenue received by every eligible 33 provider in each month beginning July 1, 2025, at a rate of six percent (6%) for services provided 34 LC000271 - Page 81 of 93 on or after July 1, 2025. Every eligible provider shall pay the monthly assessment no later than the 1 twenty-fifth day of each month following the month of receipt of gross patient revenue. 2 (b) The assessment rate established in subsection (a) of this section shall be reduced by the 3 effective rate of any tax subject to the six percent (6%) limit established pursuant to 42 CFR 433.68 4 imposed on the eligible provider in other chapters of the general laws in order that the total 5 aggregate tax shall be at a rate of six percent (6%). 6 (c) If, after applying the applicable federal law and/or rules, regulations, or standards 7 relating to healthcare providers, the tax administrator determines that the assessment rate 8 established in subsection (a) of this section exceeds the maximum rate of assessment that federal 9 law will allow without reduction in federal financial participation, then the tax administrator is 10 directed to reduce the assessment to a rate equal to the maximum rate which the federal law will 11 allow without reduction in federal participation. Provided, however, that the authority of the tax 12 administrator to lower the assessment rate established in subsection (a) of this section shall be 13 limited solely to such determination. In order that the tax administrator may properly carry out 14 his/her responsibilities under this section, the director of the department of human services shall 15 notify the tax administrator of any changes in federal law and/or any rules, regulations, or standards 16 which affect any rates for healthcare provider assessments. 17 44-72-4. Returns. 18 (a) Every eligible provider shall on or before the twenty-fifth day of the month following 19 the month of receipt of gross patient revenue make a return to the tax administrator. 20 (b) The tax administrator shall adopt rules, pursuant to this chapter, relative to the form of 21 the return and the data which it must contain for the correct computation of gross patient revenue 22 and the assessment upon that amount. All returns shall be signed by the eligible provider or by its 23 authorized representative, subject to the pains and penalties of perjury. If a return shows an 24 overpayment of the assessment due, the tax administrator shall refund or credit the overpayment to 25 the eligible provider. 26 (c) For good cause, the tax administrator may extend the time within which an eligible 27 provider is required to file a return, and if the return is filed during the period of extension, no 28 penalty or late filing charge may be imposed for failure to file the return at the time required by this 29 chapter, but the provider may be liable for interest as prescribed in this chapter. Failure to file the 30 return during the period for the extension shall void the extension. 31 44-72-5. Set-off for delinquent assessments. 32 If an eligible provider shall fail to pay an assessment within thirty (30) days of its due date, 33 the tax administrator may request any agency of state government making payments to the eligible 34 LC000271 - Page 82 of 93 provider to set off the amount of the delinquency against any payment due the provider from the 1 agency of state government and remit the sum to the tax administrator. Upon receipt of the set off 2 request from the tax administrator, any agency of state government is authorized and empowered 3 to set off the amount of the delinquency against any payment or amounts due the eligible provider. 4 The amount of set-off shall be credited against the assessment due from the eligible provider. 5 44-72-6. Assessment on available information -- Interest on delinquencies -- Penalties 6 -- Collection powers. 7 If any eligible provider shall fail to file a return within the time required by this chapter, or 8 shall file an insufficient or incorrect return, or shall not pay the assessment imposed by this chapter 9 when it is due, the tax administrator shall assess upon the information as may be available, which 10 shall be payable upon demand and shall bear interest at the annual rate provided by § 44-1-7 from 11 the date when the assessment should have been paid. If any part of the assessment made is due to 12 negligence or intentional disregard of the provisions of this chapter, a penalty of ten percent (10%) 13 of the amount of the determination shall be added to the assessment. The tax administrator shall 14 collect the assessment with interest in the same manner and with the same powers as are prescribed 15 for collection of taxes in this title. 16 44-72-7. Claims for refund -- Hearing upon denial. 17 (a) Any eligible provider subject to the provisions of this chapter may file a claim for refund 18 with the tax administrator at any time within two (2) years after the assessment has been paid. If 19 the tax administrator shall determine that the assessment has been overpaid, he or she shall make a 20 refund with interest from the date of overpayment. 21 (b) Any eligible provider whose claim for refund has been denied may, within thirty (30) 22 days from the date of the mailing by the tax administrator of the notice of the decision, request a 23 hearing and the tax administrator shall, as soon as practicable, set a time and place for the hearing 24 and shall notify the eligible provider. 25 44-72-8. Hearing by administrator on application. 26 Any eligible provider aggrieved by the action of the tax administrator in determining the 27 amount of any assessment or penalty imposed under the provisions of this chapter may apply to the 28 tax administrator, in writing, within thirty (30) days after the notice of the action is mailed to it, for 29 a hearing relative to the assessment or penalty. The tax administrator shall fix a time and place for 30 the hearing and shall notify the provider. Upon the hearing, the tax administrator shall correct 31 manifest errors, if any, disclosed at the hearing and assess and collect the amount lawfully due 32 together with any penalty or interest. 33 44-72-9. Appeals. 34 LC000271 - Page 83 of 93 Appeals from administrative orders or decisions made pursuant to any provisions of this 1 chapter shall be to the sixth division district court pursuant to §§ 8-8-24 through 8-8-29. The eligible 2 provider's right to appeal under this section shall be expressly made conditional upon prepayment 3 of all assessments, interest, and penalties unless the provider moves for and is granted an exemption 4 from the prepayment requirement pursuant to § 8-8-26. If the court, after appeal, holds that the 5 eligible provider is entitled to a refund, the eligible provider shall also be paid interest on the amount 6 at the rate provided in § 44-1-7.1. 7 44-72-10. Eligible provider records. 8 Every eligible provider shall: 9 (1) Keep records as may be necessary to determine the amount of its liability under this 10 chapter. 11 (2) Preserve those records for the period of three (3) years following the date of filing of 12 any return required by this chapter, or until any litigation or prosecution under this chapter is finally 13 determined. 14 (3) Make those records available for inspection by the tax administrator or the 15 administrator's authorized agents, upon demand, at reasonable times during regular business hours. 16 44-72-11. Method of payment and deposit of assessment. 17 (a) The payments required by this chapter may be made by electronic transfer of monies to 18 the general treasurer and deposited to the general fund. 19 (b) The general treasurer is authorized to establish an account or accounts and to take all 20 steps necessary to facilitate the electronic transfer of monies. The general treasurer shall provide 21 the tax administrator with a record of any monies transferred and deposited. 22 44-72-12. Rules and regulations. 23 The tax administrator shall make and promulgate rules, regulations, and procedures not 24 inconsistent with state law and fiscal procedures as the tax administrator deems necessary for the 25 proper administration of this chapter and to implement the provisions, policy, and purposes of this 26 chapter. 27 44-72-13. Release of assessment information. 28 Notwithstanding any other provisions of the general laws, the tax administrator shall not 29 be prohibited from providing assessment information to the director of the department of human 30 services or his or her designee, with respect to the assessment imposed by this chapter; provided 31 that, the director of human services and the director's agents and employees may use or disclose 32 that information only for purposes directly connected with the administration of the duties and 33 programs of the department of human services. 34 LC000271 - Page 84 of 93 44-72-14. Severability. 1 If any provision of this chapter or the application of this chapter to any person or 2 circumstances is held invalid, that invalidity shall not affect other provisions or applications of the 3 chapter which can be given effect without the invalid provision or application, and to this end the 4 provisions of this chapter are declared to be severable. 5 SECTION 22. Relating to Capital Development Programs - Statewide Referendum. 6 Section 1. Proposition to be submitted to the people. -- At the general election to be held 7 on the Tuesday next after the first Monday in November, 2026, there shall be submitted to the 8 people of the State of Rhode Island, for their approval or rejection, the following proposition: 9 "Shall the action of the general assembly, by an act passed at the January 2023 session, 10 authorizing the issuance of a bond, refunding bond, and/or temporary note of the State of Rhode 11 Island for the local capital projects and in the total amount with respect to the projects listed below 12 be approved, and the issuance of a bond, refunding bond, and/or temporary note authorized in 13 accordance with the provisions of said act? 14 Funding 15 The bond, refunding bond and/or temporary note shall be allocated to the Medicaid office 16 for oversight of the funds. 17 Project 18 (1) Group homes, assisted living facilities, and recovery beds $300,000,000 19 Approval of this question will allow the State of Rhode Island to issue general obligation 20 bonds, refunding bonds, and/or temporary notes in an amount not to exceed three hundred million 21 dollars ($300,000,000) for expansion of and investment in Rhode Island Community Living and 22 Supports. One hundred million dollars ($100,000,000) shall be allocated for investment in and 23 expansion of state group homes operated by Rhode Island Community Living and Supports. One 24 hundred million dollars ($100,000,000) shall be allocated for the construction of assisted living- 25 level care facilities for people with mental illnesses and developmental disabilities operated by 26 Rhode Island Community Living and Supports for persons who are eligible for Medicaid. One 27 hundred million dollars ($100,000,000) shall be allocated for the construction of inpatient recovery 28 facilities operated by Rhode Island Community Living and Supports for persons who are eligible 29 for Medicaid and suffering from substance abuse issues in need of inpatient recovery services. 30 None of these funds may be allocated to private facilities. 31 (2) Hospital facilities expansion $50,000,000 32 Approval of this question will allow the State of Rhode Island to issue general obligation 33 bonds, refunding bonds, and/or temporary notes in an amount not to exceed fifty million dollars 34 LC000271 - Page 85 of 93 ($50,000,000) for the improvement of state operated hospital facilities. 1 (3) University of Rhode Island Medical School $500,000,000 2 Approval of this question will allow the State of Rhode Island to issue a general obligation 3 bond, refunding bond, and/or temporary note in an amount not to exceed five hundred million 4 dollars ($500,000,000) for the construction of a medical school at the University of Rhode Island. 5 The Medicaid office shall work with the University of Rhode Island Medical School to establish a 6 reasonable annual contribution to fund the debt service on this bond from tuition revenue. While 7 these contributions shall continue until the entire debt service costs are paid, the Medicaid office 8 may allow for an amortization schedule that lasts for up to fifty (50) years." 9 Section 2. Ballot labels and applicability of general election laws. -- The secretary of state 10 shall prepare and deliver to the state board of elections ballot labels for each of the projects provided 11 for in Section 1 hereof with the designations "approve" or "reject" provided next to the description 12 of each such project to enable voters to approve or reject each such proposition. The general 13 election laws, so far as consistent herewith, shall apply to this proposition. 14 Section 3. Approval of projects by people. -- If a majority of the people voting on the 15 proposition in Section 1 hereof shall vote to approve any project stated therein, said project shall 16 be deemed to be approved by the people. The authority to issue bonds, refunding bonds and/or 17 temporary notes of the state shall be limited to the aggregate amount for all such projects as set 18 forth in the proposition, which have been approved by the people. 19 Section 4. Bonds for capital development program. -- The general treasurer is hereby 20 authorized and empowered, with the approval of the governor, and in accordance with the 21 provisions of this act to issue capital development bonds in serial form, in the name of and on behalf 22 of the State of Rhode Island, in amounts as may be specified by the governor in an aggregate 23 principal amount not to exceed the total amount for all projects approved by the people and 24 designated as "capital development loan of 2026 bonds." Provided, however, that the aggregate 25 principal amount of such capital development bonds and of any temporary notes outstanding at any 26 one time issued in anticipation thereof pursuant to Section 7 hereof shall not exceed the total amount 27 for all such projects approved by the people. All provisions in this act relating to "bonds" shall also 28 be deemed to apply to "refunding bonds." 29 Capital development bonds issued under this act shall be in denominations of one thousand 30 dollars ($1,000) each, or multiples thereof, and shall be payable in any coin or currency of the 31 United States which at the time of payment shall be legal tender for public and private debts. 32 These capital development bonds shall bear such date or dates, mature at specified time or 33 times, but not mature beyond the end of the twentieth state fiscal year following the fiscal year in 34 LC000271 - Page 86 of 93 which they are issued; bear interest payable semi-annually at a specified rate or different or varying 1 rates; be payable at designated time or times at specified place or places; be subject to express terms 2 of redemption or recall, with or without premium; be in a form, with or without interest coupons 3 attached; carry such registration, conversion, reconversion, transfer, debt retirement, acceleration 4 and other provisions as may be fixed by the general treasurer, with the approval of the governor, 5 upon each issue of such capital development bonds at the time of each issue. Whenever the 6 governor shall approve the issuance of such capital development bonds, the governor's approval 7 shall be certified to the secretary of state; the bonds shall be signed by the general treasurer and 8 countersigned by the secretary of state and shall bear the seal of the state. The signature approval 9 of the governor shall be endorsed on each bond. 10 Section 5. Refunding bonds for 2026 capital development program. -- The general treasurer 11 is hereby authorized and empowered, with the approval of the governor, and in accordance with 12 the provisions of this act, to issue bonds to refund the 2026 capital development program bonds, in 13 the name of and on behalf of the state, in amounts as may be specified by the governor in an 14 aggregate principal amount not to exceed the total amount approved by the people, to be designated 15 as "capital development program loan of 2026 refunding bonds" (hereinafter "refunding bonds"). 16 The general treasurer with the approval of the governor shall fix the terms and form of any 17 refunding bonds issued under this act in the same manner as the capital development bonds issued 18 under this act, except that the refunding bonds may not mature more than twenty (20) years from 19 the date of original issue of the capital development bonds being refunded. The proceeds of the 20 refunding bonds, exclusive of any premium and accrual interest and net the underwriters' cost, and 21 cost of bond insurance, shall, upon their receipt, be paid by the general treasurer immediately to 22 the paying agent for the capital development bonds which are to be called and prepaid. The paying 23 agent shall hold the refunding bond proceeds in trust until they are applied to prepay the capital 24 development bonds. While the proceeds are held in trust, the proceeds may be invested for the 25 benefit of the state in obligations of the United States of America or the State of Rhode Island. 26 If the general treasurer shall deposit with the paying agent for the capital development 27 bonds the proceeds of the refunding bonds, or proceeds from other sources, amounts that, when 28 invested in obligations of the United States or the State of Rhode Island, are sufficient to pay all 29 principal, interest, and premium, if any, on the capital development bonds until these bonds are 30 called for prepayment, then such capital development bonds shall not be considered debts of the 31 State of Rhode Island for any purpose starting from the date of deposit of such monies with the 32 paying agent. The refunding bonds shall continue to be a debt of the state until paid. 33 The term "bond" shall include "note," and the term "refunding bonds" shall include 34 LC000271 - Page 87 of 93 "refunding notes" when used in this act. 1 Section 6. Proceeds of capital development program. -- The general treasurer is directed to 2 deposit the proceeds from the sale of capital development bonds issued under this act, exclusive of 3 premiums and accrued interest and net the underwriters' cost, and cost of bond insurance, in one or 4 more of the depositories in which the funds of the state may be lawfully kept in special accounts 5 (hereinafter cumulatively referred to as "such capital development bond fund") appropriately 6 designated for each of the projects set forth in Section 1 hereof which shall have been approved by 7 the people to be used for the purpose of paying the cost of all such projects so approved. 8 All monies in the capital development bond fund shall be expended for the purposes 9 specified in the proposition provided for in Section 1 hereof under the direction and supervision of 10 the director of administration (hereinafter referred to as "director"). The director, or designee, shall 11 be vested with all power and authority necessary or incidental to the purposes of this act, including, 12 but not limited to, the following authority: 13 (1) To acquire land or other real property or any interest, estate, or right therein as may be 14 necessary or advantageous to accomplish the purposes of this act; 15 (2) To direct payment for the preparation of any reports, plans and specifications, and 16 relocation expenses and other costs such as for furnishings, equipment designing, inspecting, and 17 engineering, required in connection with the implementation of any projects set forth in Section 1 18 hereof; 19 (3) To direct payment for the costs of construction, rehabilitation, enlargement, provision 20 of service utilities, and razing of facilities, and other improvements to land in connection with the 21 implementation of any projects set forth in Section 1 hereof; and 22 (4) To direct payment for the cost of equipment, supplies, devices, materials, and labor for 23 repair, renovation, or conversion of systems and structures as necessary for the 2023 capital 24 development program bonds or notes hereunder from the proceeds thereof. No funds shall be 25 expended in excess of the amount of the capital development bond fund designated for each project 26 authorized in Section 1 hereof. 27 Section 7. Sale of bonds and notes. --Any bonds or notes issued under the authority of this 28 act shall be sold at not less than the principal amount thereof, in such mode and on such terms and 29 conditions as the general treasurer, with the approval of the governor, shall deem to be in the best 30 interests of the state. 31 Any bonds or notes issued under the provisions of this act and coupons on any capital 32 development bonds, if properly executed by the manual or electronic signatures of officers of the 33 state in office on the date of execution, shall be valid and binding according. to their tenor, 34 LC000271 - Page 88 of 93 notwithstanding that before the delivery thereof and payment therefor, any or all such officers shall 1 for any reason have ceased to hold office. 2 Section 8. Bonds and notes to be tax exempt and general obligations of the state. -- All 3 bonds and notes issued under the authority of this act shall be exempt from taxation in the state and 4 shall be general obligations of the state, and the full faith and credit of the state is hereby pledged 5 for the due payment of the principal and interest on each of such bonds and notes as the same shall 6 become due. 7 Section 9. Investment of monies in fund. -- All monies in the capital development fund not 8 immediately required for payment pursuant to the provisions of this act may be invested by the 9 investment commission, as established by chapter 10 of title 35, entitled "state investment 10 commission," pursuant to the provisions of such chapter; provided, however, that the securities in 11 which the capital development fund is invested shall remain a part of the capital development fund 12 until exchanged for other securities; and provided further, that the income from investments of the 13 capital development fund shall become a part of the general fund of the state and shall be applied 14 to the payment of debt service charges of the state, unless directed by federal law or regulation to 15 be used for some other purpose, or to the extent necessary, to rebate to the United States treasury 16 any income from investments (including gains from the disposition of investments) of proceeds of 17 bonds or notes to the extent deemed necessary to exempt (in whole or in part) the interest paid on 18 such bonds or notes from federal income taxation. 19 Section 10. Appropriation. -- To the extent the debt service on these bonds is not otherwise 20 provided, a sum sufficient to pay the interest and principal due each year on bonds and notes 21 hereunder is hereby annually appropriated out of any money in the treasury not otherwise 22 appropriated. 23 Section 11. Advances from general fund. -- The general treasurer is authorized, with the 24 approval of the director and the governor, in anticipation of the issuance of bonds or notes under 25 the authority of this act, to advance to the capital development bond fund for the purposes specified 26 in Section 1 hereof, any funds of the state not specifically held for any particular purpose; provided, 27 however, that all advances made to the capital development bond fund shall be returned to the 28 general fund from the capital development bond fund forthwith upon the receipt by the capital 29 development fund of proceeds resulting from the issue of bonds or notes to the extent of such 30 advances. 31 Section 12. Federal assistance and private funds. -- In carrying out this act, the director, or 32 designee, is authorized on behalf of the state, with the approval of the governor, to apply for and 33 accept any federal assistance which may become available for the purpose of this act, whether in 34 LC000271 - Page 89 of 93 the form of a loan or grant or otherwise, to accept the provision of any federal legislation therefor, 1 to enter into, act and carry out contracts in connection therewith, to act as agent for the federal 2 government in connection therewith, or to designate a subordinate so to act. Where federal 3 assistance is made available, the project shall be carried out in accordance with applicable federal 4 law, the rules and regulations thereunder and the contract or contracts providing for federal 5 assistance, notwithstanding any contrary provisions of state law. Subject to the foregoing, any 6 federal funds received for the purposes of this act shall be deposited in the capital development 7 bond fund and expended as a part thereof. The director or designee may also utilize any private 8 funds that may be made available for the purposes of this act. 9 Section 13. Effective Date. -- Sections 1, 2, 3, 10, 11 and 12 of this act shall take effect 10 upon passage. The remaining sections of this act shall take effect when and if the state board of 11 elections shall certify to the secretary of state that a majority of the qualified electors voting on the 12 proposition contained in Section 1 hereof have indicated their approval of all or any projects 13 thereunder. 14 SECTION 22. Rhode Island Medicaid Reform Act of 2008 Joint Resolution. 15 WHEREAS, The General Assembly enacted chapter 12.4 of title 42 entitled "The Rhode 16 Island Medicaid Reform Act of 2008"; and 17 WHEREAS, A legislative enactment is required pursuant to Rhode Island General Laws 18 chapter 12.4 of title 42; and 19 WHEREAS, Rhode Island General Laws § 42-7.2-5(3)(i) provides that the Secretary of the 20 Executive Office of Health and Human Services ("Executive Office") is responsible for the 21 implementation of Medicaid policies; and 22 WHEREAS, In pursuit of a higher quality system of care, the General Assembly grants 23 legislative approval of the following proposals and directs the Secretary to implement them; and 24 WHEREAS, If implementation requires changes to rules, regulations, procedures, the 25 Medicaid state plan, and/or the section 1115 waiver, the General Assembly directs and empowers 26 the Secretary to make said changes; further, adoption of new or amended rules, regulations and 27 procedures may also be required: 28 (a) Raising Nursing Facility Personal Needs Allowance. The Executive Office will raise 29 the personal needs allowance for nursing facility residents to two hundred dollars ($200). 30 (b) Medicare Equivalent Rate. The Executive Office will raise all Medicaid rates, except 31 for hospital rates, dental rates, and outpatient behavioral health rates to equal the Medicare 32 equivalent rate. Specific to early intervention services, a payment of fifty dollars ($50.00) per 33 member per month payment shall be established in addition to these rates, and a floor of fifty 34 LC000271 - Page 90 of 93 percent (50%) rate increase shall be established within the calculation of the Medicare equivalent 1 rate. 2 (c) Setting Outpatient Behavioral Healthcare Rates at one hundred fifty percent (150%) of 3 Medicare Equivalent Rates. The Executive Office will set outpatient behavioral health rates at one 4 hundred fifty percent (150%) of the Medicare equivalent rate. The Executive Office will maximize 5 federal financial participation if and when available, though state-only funds will be used if federal 6 financial participation is not available. 7 (d) FQHC APM Modernization. The Executive Office will make certain modifications to 8 modernize and standardize the alternative payment methodology option for federally qualified 9 health centers. 10 (e) Hospital Payment Modernization. The Executive Office will make changes to hospital 11 payment rates to modernize payment methodologies to encourage utilization and quality. Inpatient 12 FFS DRG rates will be set at ninety percent (90%) of the Medicare equivalent rate, inpatient non- 13 DRG FFS rates will be established at ninety-five percent (95%) of the Medicare equivalent rate, 14 inpatient managed care rates will be set at one hundred five percent (105%) of FFS rates, and 15 outpatient rates will be set at one hundred percent (100%) of Medicare rates. 16 (f) RIteShare Freedom of Choice. The Executive Office will make employee participation 17 in the RIteShare program voluntary. 18 (g) Elderly and Disabled Eligibility Expansion. The Executive Office will expand 19 Medicaid eligibility for elderly and disabled residents to one hundred thirty-three percent (133%) 20 of the federal poverty level. 21 (h) Payments Streamlining. The Executive Office will conduct a multifaceted initiative to 22 begin the phase-out of intermediary payers such as managed care entities, streamlining payments 23 and reducing wasteful expenditures on intermediary payers. 24 (i) Medicaid Office Expansion. The Executive Office will expand Medicaid office staffing 25 to improve administrative capacities. 26 (j) End to Health System Transformation Project. The Executive Office will end the Health 27 System Transformation Project to reduce risk exposure to providers and increase the efficiency of 28 the payments system. 29 (k) Rhode Island Mental Health Nursing Facility. The Executive Office will open a state 30 nursing facility to serve patients with significant mental health needs. 31 (l) Raising Nursing Facility Assessment Rate. The Executive Office will raise the nursing 32 facility assessment rate to six percent (6%). 33 (m) Universal Provider Assessment. Consistent with overall goals of transitioning all 34 LC000271 - Page 91 of 93 services to a model where rates are at the Medicare equivalent rate, the Executive Office will extend 1 the existing nursing facility assessment model to cover all providers eligible for taxation under 2 federal regulations to help defray the costs of the state component. 3 (n) Dental Optimization. The Executive Office will make an array of changes to dental 4 benefits offered under Medicaid. Rates will be the rates utilized in § 27-18-54; § 27-19-30.1 § 27- 5 20-25.2; and § 27-41-27.2; billing will be extended to teledentistry services, Silver Diamine 6 Fluoride (code D1354), and denture billing (codes D5130, D5140, D5221, D5222, D5213, and 7 D5214); the mobile dentistry encounter rate will be raised to the FQHC rate; and a fifty percent 8 (50%) payment shall be established for undeliverable dentures. 9 (o) Transition to State-Level Medicare for All. The Executive Office is empowered to 10 begin the process of negotiating the necessary waivers for a transition to a state-level Medicare for 11 All health care payments system for Rhode Island. These waivers shall include the combining of 12 all federal health care funding streams into the system financing including, but not limited to, 13 Medicaid, Medicare, federal health care tax exemptions, and exchange subsides established 14 pursuant to the U.S. Patient Protection and Affordable Care Act of 2010. The Executive Office 15 plans to begin the transition process after the completion of the raising of the Medicaid system to 16 a Medicare standard of care and the associated stabilization of the Rhode Island health care 17 workforce and provider network; provided, however, that the Executive Office, understanding the 18 complexity of the proposed waiver application, reserves the right to begin the waiver negotiation 19 process before the transition of Medicaid to a Medicare standard is complete. The Executive Office 20 shall only proceed with the waiver and transition should waiver conditions be favorable to the state 21 as a whole, in the judgment of the Executive Office. In the event that a full waiver cannot be 22 complete, and health insurers have been acquired by the Medicaid Office due to insolvency and the 23 Medicaid Office's goal of payer system stabilization, the Executive Office is empowered to seek 24 limited waivers for the streamlining and integration of acquired health insurers with the Medicaid 25 system. The Executive Office shall submit the final approved waiver and transition plan to the 26 general assembly for final approval. 27 Now, therefore, be it: 28 RESOLVED, That the General Assembly hereby approves the proposals stated above in 29 the recitals; and be it further; 30 RESOLVED, That the Secretary of the Executive Office of Health and Human Services is 31 authorized to pursue and implement any waiver amendments, state plan amendments, and/or 32 changes to the applicable department's rules, regulations and procedures approved herein and as 33 authorized by chapter 12.4 of title 42; and be it further; 34 LC000271 - Page 92 of 93 RESOLVED, That this Joint Resolution shall take effect upon passage. 1 SECTION 23. This act shall take effect upon passage; however, the RICHIP program shall 2 not come into operation until the necessary waivers are obtained, and the final financing proposal 3 is approved by the general assembly. 4 ======== LC000271 ======== LC000271 - Page 93 of 93 EXPLANATION BY THE LEGISLATIVE COUNCIL OF A N A C T RELATING TO HEALTH AND SAFETY -- THE RHODE ISLAND COMPREHENSIVE HEALTH INSURANCE PROGRAM *** This act would establish a universal, comprehensive, affordable single-payer health care 1 insurance program and help control health care costs, which would be referred to as, "the Rhode 2 Island Comprehensive Health Insurance Program" (RICHIP). The program would be paid for by 3 consolidating government and private payments to multiple insurance carriers into a more 4 economical and efficient improved Medicare-for-all style single-payer program and substituting 5 lower progressive taxes for higher health insurance premiums, co-pays, deductibles and costs due 6 to caps. This program would save Rhode Islanders from the current overly expensive, inefficient 7 and unsustainable multi-payer health insurance system that unnecessarily prevents access to 8 medically necessary health care. 9 This act would take effect upon passage; however, the RICHIP program would not come 10 into operation until the necessary waivers are obtained, and the final financing proposal is approved 11 by the general assembly. 12 ======== LC000271 ========