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BILL AS PASSED BY SENATE 2007-2008

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S.114

AN ACT RELATING TO ENHANCING MENTAL HEALTH PARITY

It is hereby enacted by the General Assembly of the State of Vermont:

Sec. 1.  8 V.S.A. § 4089b(b) is amended to read:

(b)  A health insurance plan shall provide coverage for treatment of a mental health condition and shall:

(1)  not establish any rate, term, or condition that places a greater financial burden on an insured for access to treatment for a mental health condition than for access to treatment for a physical health condition;

* * *

Sec. 2.  8 V.S.A. § 4089b(c) is amended to read:

(c)(1)(A) A health insurance plan that does not otherwise provide for management of care under the plan, or that does not provide for the same degree of management of care for all health conditions, may provide coverage for treatment of mental health conditions through a managed care organization provided that the managed care organization is in compliance with the rules adopted by the commissioner that assure that the system for delivery of treatment for mental health conditions does not diminish or negate the purpose of this section.

(B)  The rules adopted by the commissioner shall assure that:

(i)  timely and appropriate access to care is available; that

(ii)  the quantity, location and specialty distribution of health care providers is adequate; and that

(iii)  administrative or clinical protocols do not serve to reduce access to medically necessary treatment for any insured;

(iv)  utilization review and other administrative and clinical protocols do not deter timely and appropriate emergency hospital admissions;

(v)  in the case of a managed care organization which contracts with a health insurer to administer the insurer’s mental health benefits, the portion of a health insurer’s premium rate attributable to the coverage of mental health benefits is reviewed under sections 4062, 4513, 4584, or 5104 of this title to determine whether it is excessive, inadequate, unfairly discriminatory, unjust, unfair, inequitable, misleading or contrary to the laws of this state; and

(vi)  the health insurance plan is consistent with the Blueprint for Health with respect to mental health conditions, as determined by the commissioner under section 9414(b)(2) of Title 18.

(C)  Prior to the adoption of rules pursuant to this subdivision, the commissioner shall consult with the commissioner of mental health concerning:

(i)  developing incentives and other measures addressing the availability of providers of care and treatment for mental health conditions, especially in medically underserved areas;

(ii)  incorporating best practices and evidence-based guidelines into the utilization review of mental health conditions; and

(iii)  establishing benefit design, infrastructure support, and payment methodology standards for evaluating the health insurance plan’s consistency with the Blueprint for Health with respect to the care and treatment of mental health conditions.

(2)  A managed care organization providing or administering coverage for treatment of mental health conditions on behalf of a health insurance plan shall comply with this section, sections 4089a and 4724 of this title, and section 9414 of Title 18, with rules adopted pursuant to those provisions of law, and with all other obligations, under Title 18 and under this title, of the health insurance plan and the health insurer on behalf of which the review agent is providing or administering coverage.  A violation of any provision of this section shall constitute an unfair act or practice in the business of insurance in violation of section 4723 of this title.

(3)  A health insurer that contracts with a managed care organization to provide or administer coverage for treatment of mental health conditions is fully responsible for the acts and omissions of the managed care organization, including any violations of this section or a rule adopted pursuant to this section.

(4)  In addition to any other remedy or sanction provided for by law, if the commissioner, after notice and an opportunity to be heard, finds that a health insurance plan or managed care organization has violated this section or any rule adopted pursuant to this section, the commissioner may:

(A)  Assess a penalty on the health insurer or managed care organization under section 4726 of this title;

(B)  Order the health insurer or managed care organization to cease and desist in further violations;

(C)  Order the health insurer or managed care organization to remediate the violation, including issuing an order to the health insurer to terminate its contract with the managed care organization; and

(D)  Revoke or suspend the license of a health insurer or managed care organization, or permit continued licensure subject to such conditions as the commissioner deems necessary to carry out the purposes of this section.

(5)  As used in this subsection, the term “managed care organization” includes any of the following entities that provide or administer the coverage of mental health benefits on behalf of a health insurance plan:

(A)  a review agent as defined in section 4089a of this title;

(B)  a health insurer or an affiliate of a health insurer as defined in section 9402 of Title 18;

(C)  a managed care organization or an affiliate of a managed care organization as defined in section 9402 of Title 18; and

(D)  a person or entity that should be licensed as a managed care organization.

Sec. 3.  8 V.S.A. § 4089b(g) is amended to read:

(g)  The commissioner shall establish a task force to develop performance quality measures, and address oversight issues for managed behavioral health care organizations, and review the results of any quality improvement projects not otherwise confidential or privileged, undertaken by managed care organizations for mental health and substance abuse care and treatment under section 9414(i) of Title 18.  The task force shall report to the senate committees on health and welfare of the senate and the house of representatives committees on health care and on human services on or before January 15 of each year with a report on the activities and recommendations of the task force.  The task force shall include the following:

(1)  the commissioner of developmental and mental health services or a designee;

(2)  the director of the office of Vermont health access or a designee;

(3)  the commissioner of banking, insurance, securities, and health care administration or a designee;

(4)  fourteen additional members appointed by the commissioner of banking, insurance, securities, and health care administration, including:

(A)  four representatives of the health insurance and behavioral managed care organization industry;

(B)  two consumers, after consultation with the health care ombudsman;

(C)  one psychologist, after consultation with the Vermont psychological association;

(D)  one psychiatrist, after consultation with the Vermont psychiatric association;

(E)  one social worker, after consultation with the National Association of Social Workers, Vermont Chapter;

(F)  one mental health counselor, after consultation with the Vermont mental health counselors association;

(G)  one drug and alcohol counselor, after consultation with the Vermont association of drug and alcohol counselors;

(H)  one representative from a consumer or citizen's organization;

(I)  one representative from the business community; and

(J)  one representative of community mental health centers.

Sec. 4.  18 V.S.A. § 9414(g) is amended to read:

(g)(1)  If In addition to any other remedy or sanction provided by law, after notice and an opportunity to be heard, if the commissioner determines that a managed care organization has violated or failed to comply with any of the provisions of this section or any rule adopted pursuant to this section, the commissioner may:

(A)  sanction the violation or failure to comply as provided in Title 8, including sanctions provided by or incorporated in sections 5108 and 5109 of Title 8 and section 4726 of Title 8, and may use any information obtained during the course of any legal or regulatory action against a managed care organization;

(B)  order the managed care organization to cease and desist in further violations; and

(C)  order the managed care organization to remediate the violation, including issuing an order to the managed care organization to terminate its contract with any person or entity which administers claims or the coverage of benefits on behalf of the managed care organization.

(2)  A managed care organization that contracts with a person or entity to administer claims or provide coverage of health benefits is fully responsible for the acts and omissions of such person or entity.  Such person or entity shall comply with all obligations, under this title and Title 8, of the health insurance plan and the health insurer on behalf of which the such person or entity is providing or administering coverage.

(3)  A violation of any provision of this section or a rule adopted pursuant to this section shall constitute an unfair act or practice in the business of insurance in a violation of section 4723 of Title 8.

Sec. 5.  18 V.S.A. § 9414(i) is added to read:

(3)  Upon review of the managed care organization’s clinical data, or after consideration of claims or other data, the commissioner may:

(A)  identify quality issues in need of improvement; and

(B)  direct the managed care organization to propose quality improvement initiatives to remediate those issues.

Sec. 6.  EFFECTIVE DATE; LEGISLATIVE INTENT; APPLICABILITY

(a)  This act shall take effect upon passage, except that Secs. 2 and 4 of this act shall take effect July 1, 2008.

(b)  The provisions of 8 V.S.A. § 4089b(c)(2) and (3), and 18 V.S.A. § 9414(g)(2) and (3) are intended to clarify existing law.  The remedies provided for in 8 V.S.A. § 4089b(c)(4), and 18 V.S.A. § 9414(g)(1) shall apply to legal or regulatory violations that occur before and after passage of this act.



Published by:

The Vermont General Assembly
115 State Street
Montpelier, Vermont


www.leg.state.vt.us