DEPARTMENT OF HEALTH INSURANCE DEPARTMENT External Review under the Affordable Care Act [41 Pa.B. 7041]
[Saturday, December 31, 2011]To Health Insurance Entities, Including Managed Care Plans:
On July 29, 2011, the Federal Department of Health and Human Services issued its determination that the Commonwealth of Pennsylvania does not meet federal requirements for external review under the Affordable Care Act (ACA). In addition, on November 22, 2011, the Director of the Appeals and Grievances Division in the Centers for Consumer Information and Insurance Oversight of the Centers for Medicare and Medicaid Services issued a letter to issuers of health insurance in the Commonwealth, requiring them to make good faith efforts to come into compliance with Federal law and to be fully participating in a Federally-administered external review process on January 1, 2012. Both of those communications are available on the Insurance Department's web site under ''Federal Health Care Reform.'' In light of those communications, we issue this notification.
The Pennsylvania Department of Health and Insurance Department (hereinafter ''the Departments'') hereby remind managed care plans that, while they are required to follow federal law as set out in those communications, the requirements of Article XXI of the Insurance Company Law of 1921, commonly referred to as Act 68, remain in effect after January 1, 2012, except to the extent that federal law has replaced those requirements. Thus, issues of network adequacy, contract review, credentialing, which are dealt with by the Department of Health, and prompt pay, which is dealt with by the Insurance Department, among other matters, will still be reviewed by the relevant department. The Departments will also continue to review as complaints matters that are not considered adverse benefit determinations as defined by the ACA and its regulations1 , in the same manner as before the passage of the ACA. (Examples of the type of complaints that should continue coming to the PA Departments, and not go to HHS, are complaints relating to contract exclusions, and issues relating to co-payments, formulary changes, out-of-network benefits, and services beyond the contractual limitation.) However, adverse benefit determinations, as defined by the ACA, will be subject to Federal review. As more fully described in the ACA and the accompanying regulations, adverse benefit determinations include issues that relate to denials, reductions, terminations or failures to provide or make payment in whole or in part for a benefit.
It is the hope of the Departments that this transition may be effectuated with the least possible disruption to enrollees. In order to facilitate the upcoming transition, the Departments are requesting that each insurer, including each managed care plan, (1) provide to the Departments the name, mailing and e-mail addresses, telephone number, and fax number of the individual or individuals who will be the point persons for both internal and external reviews; and (2) inform the Departments of which Federally-administered external review process the plan has selected. Please provide this information in writing by mail or email (a copy of your response to HHS's November 22, 2011 letter will suffice) to Carolyn Morris, Director, Pennsylvania Insurance Department, Bureau of Consumer Services, 1209 Strawberry Square, Harrisburg, PA 17120 or camorris@pa.gov and to Melanie Waters, Director, Pennsylvania Department of Health, Bureau of Managed Care, Room 912, Health and Welfare Building, 7th & Forester Streets, Harrisburg, PA 17120 or melwaters@pa.gov as soon as possible but no later than January 31, 2012.
To the extent the implementation of an ACA compliant internal review process or a Federally-administered external review process requires revised language in any of the insurer's policy forms relating to the review process only, please submit a certification to the Accident & Health Bureau of the Insurance Department, executed by an authorized representative, that the policy form has been modified to bring it into compliance with Federal law. To accommodate the immediate nature of this implementation requirement, filing of the certification will exempt the form from the prior filing requirements of Act 159 of 1996 (40 P. S. §§ 3801—3815). (The form published by the Insurance Department relating to the PPACA immediate insurance reforms, at 40 Pa.B. 3754, July 3, 2010, may be modified for this purpose.) Subsequent policy form filings, or policy form filings containing changes beyond this one issue, must comply with the filing requirements of Act 159 of 1996 (40 P. S. §§ 3801—3815).
The Departments are attempting to obtain information regarding to whom consumer inquiries may be made on a Federal level, and when that information is obtained, will provide it to insurers for their use.
The Departments thank you in advance for your attention to this notice and for your prompt response. The new HHS requirements require careful consideration of the review process and the Departments pledge to work with you through this transition.
ELI N. AVILA, MD, JD, MPH, FCLM,
SecretaryMICHAEL F. CONSEDINE,
Insurance Commissioner[Pa.B. Doc. No. 11-2254. Filed for public inspection December 30, 2011, 9:00 a.m.] _______
1 42 U.S.C. § 300gg-19 and 45 C.F.R. Part 147 (health insurance reform requirements for the group and individual health insurance markets). An adverse benefit determination is defined in federal law as ''a denial, reduction, or termination of, or a failure to provide or make payment (in whole or in part) for, a benefit, including any such denial, reduction, termination, or failure to provide or make payment that is based on a determination of a participant's or beneficiary's eligibility to participate in a plan, and including, with respect to group health plans, a denial, reduction, or termination of, or a failure to provide or make payment (in whole or in part) for, a benefit resulting from the application of any utilization review, as well as a failure to cover an item or service for which benefits are otherwise provided because it is determined to be experimental or investigational or not medically necessary or appropriate.'' The term also includes a rescission, ''whether or not, in connection with the rescission, there is an adverse effect on any particular benefit at that time.'' See 45 C.F.R. § 147.136(a)(2)(i), incorporating 29 C.F.R § 2560.503-1(m)(4) (definition of ''adverse benefit determination'').
