HB125 simplifies some of the bureaucratic elements of the healthcare system to better serve patients, providers and employers. The bill brings more transparency to the contracting process, seeks to provide more fairness in contracting, standardizes the credentialing process and begins a study that we hope will lead to standards for a web-based real-time insurance eligibility verification system for providers and patients.
The law does not apply to Medicaid, Medicare fee-for-service, workers comp or contracts with pharmacies or nursing homes.
Transparency in Contracting
Contracting entities (HMOs, Taps and other insurers) are required to fully disclose the terms of their contracts:
-
Negotiated fee schedules
- Reimbursement rules
- List of products covered by the contract
- The term of the contract
- The entity responsible for processing claims payments
- Procedures for resolving disputes
Contracts must include a summary disclosure form-basically a “table of contents” to direct parties to sections of the contract dealing with key contract provisions.
Fairness in Contracting
HB125:
- Prohibits the use of the term “Most Favored Payer” clause, which is an anti competitive contract term
- limits the use of “All-Products” clauses in contracts
- requires contracting entities to give providers 90 days notice of significant contractual amendments
- allows “rental networks” but the selling of a providers contracted rate to another entity must be disclosed and all of the terms and conditions of the original contract apply to the party renting the network
Standardized Credentialing
HB125 empowers the Department of Insurance to develop a standardized credentialing form for non-physician providers and they have designated the national Council for Affordable Quality Healthcare (CAQH) as the form that will be used in
Ohio, with no addenda or additional information to be requested
Credentialing must be completed in 90 days. After the 90th day, there is a $500 per day penalty, or a retroactive reimbursement penalty, if the contracting entity fails to process the credentialing application.
Eligibility Verification and Real Time Claim Adjudication Advisory Committee
HB125 establishes an advisory committee to make recommendations for the development of standards for contracting entities to have a web-based eligibility verification and real time claim adjudication system. The committee will issue findings and recommendations by
Jan. 1, 2009
Applicability
The provisions of HB125 apply to all contracting entities, which would include HMOs, HICs, and third party administrator
(TPAs) administering health benefits plans on behalf of self-insured employers.
Enforcement
HB125 endorses the ADR concept of arbitration to resolve disputes that arise between contracting entities and provider
regarding the rights and obligations provided by this bill. The Ohio Department of Insurance is empowered to use its existing enforcement tools to insure compliance. Issues that are under arbitration cannot be brought to the Department of Insurance at the same time.
Effective Dates/Timelines
Provisions of HB125 affecting contracting are effective
June 25, 2008, for all new or renewed contracts or for contracts that are amended in significant ways. Health insuring corporations with fewer than 15,000 covered lives have until
June 25, 2009to implement the bill.
Credentialing provisions of the bill are effective
September 25, 2008. There is no exception for smaller health insuring corporations.
A Joint Legislative Study Commission on the Most Favored Nation Clauses in Health Care Contracts is to be appointed by
July 25, 2008. It is to report to the legislature by
March 25, 2010. The legislature can extend the moratorium on MFN clauses for on year until
June 24, 2011 and extend the deadline for the Commission report until
December 25, 2011. If the deadline is not extended the report must be submitted by
September 25, 2010.
Read the full description of the bill.