January 19, 2021
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Senate Bill 0838

Senate Bill sb0838c2

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    Florida Senate - 2005                     CS for CS for SB 838

    By the Committees on Ways and Means; Health Care; and Senators
    Peaden, Atwater, Campbell, Carlton, Rich and Saunders




    576-2236-05

  1                      A bill to be entitled

  2         An act relating to Medicaid; amending s.

  3         409.912, F.S.; requiring the Agency for Health

  4         Care Administration to contract with a vendor

  5         to monitor and evaluate the clinical practice

  6         patterns of providers; authorizing the agency

  7         to competitively bid for single-source

  8         providers for certain services; authorizing the

  9         agency to examine whether purchasing certain

10         durable medical equipment is more

11         cost-effective than long-term rental of such

12         equipment; providing that a contract awarded to

13         a provider service network remains in effect

14         for a certain period; defining a provider

15         service network; providing health care

16         providers with a controlling interest in the

17         governing body of the provider service network

18         organization; requiring that the agency, in

19         partnership with the Department of Elderly

20         Affairs, develop an integrated, fixed-payment

21         delivery system for Medicaid recipients age 60

22         and older; deleting an obsolete provision

23         requiring the agency to develop a plan for

24         implementing emergency and crisis care;

25         requiring the agency to develop a system where

26         health care vendors may provide data

27         demonstrating that higher reimbursement for a

28         good or service will be offset by cost savings

29         in other goods or services; requiring the

30         Comprehensive Assessment and Review for

31         Long-Term Care Services (CARES) teams to

                                  1

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    Florida Senate - 2005                     CS for CS for SB 838
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 1         consult with any person making a determination

 2         that a nursing home resident funded by Medicare

 3         is not making progress toward rehabilitation

 4         and assist in any appeals of the decision;

 5         requiring the agency to contract with an entity

 6         to design a clinical-utilization information

 7         database or electronic medical record for

 8         Medicaid providers; requiring that the agency

 9         develop a plan to expand disease-management

10         programs; requiring the agency to coordinate

11         with other entities to create emergency room

12         diversion programs for Medicaid recipients;

13         revising the Medicaid prescription drug

14         spending control program to reduce costs and

15         improve Medicaid recipient safety; requiring

16         that the agency implement a Medicaid

17         prescription drug management system; allowing

18         the agency to require age-related prior

19         authorizations for certain prescription drugs;

20         requiring the agency to determine the extent

21         that prescription drugs are returned and reused

22         in institutional settings and whether this

23         program could be expanded; requiring the agency

24         to develop an in-home, all-inclusive program of

25         services for Medicaid children with

26         life-threatening illnesses; authorizing the

27         agency to pay for emergency mental health

28         services provided through licensed crisis

29         stabilization centers; creating s. 409.91211,

30         F.S.; requiring that the agency develop a pilot

31         program for capitated managed care networks to

                                  2

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 1         deliver Medicaid health care services for all

 2         eligible Medicaid recipients in Medicaid

 3         fee-for-service or the MediPass program;

 4         authorizing the agency to include an

 5         alternative methodology for making additional

 6         Medicaid payments to hospitals; providing

 7         legislative intent; providing powers, duties,

 8         and responsibilities of the agency under the

 9         pilot program; requiring that the agency

10         provide a plan to the Legislature for

11         implementing the pilot program; requiring that

12         the Office of Program Policy Analysis and

13         Government Accountability, in consultation with

14         the Auditor General, evaluate the pilot program

15         and report to the Governor and the Legislature

16         on whether it should be expanded statewide;

17         amending s. 409.9122, F.S.; revising a

18         reference; amending s. 409.913, F.S.; requiring

19         5 percent of all program integrity audits to be

20         conducted on a random basis; requiring that

21         Medicaid recipients be provided with an

22         explanation of benefits; requiring that the

23         agency report to the Legislature on the legal

24         and administrative barriers to enforcing the

25         copayment requirements of s. 409.9081, F.S.;

26         requiring the agency to recommend ways to

27         ensure that Medicaid is the payer of last

28         resort; requiring the agency to conduct a study

29         of provider pay-for-performance systems;

30         requiring the Office of Program Policy Analysis

31         and Government Accountability to conduct a

                                  3

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 1         study of the long-term care diversion programs;

 2         requiring the agency to evaluate the

 3         cost-saving potential of contracting with a

 4         multistate prescription drug purchasing pool;

 5         requiring the agency to determine how many

 6         individuals in long-term care diversion

 7         programs have a patient payment responsibility

 8         that is not being collected and to recommend

 9         how to collect such payments; requiring the

10         Office of Program Policy Analysis and

11         Government Accountability to conduct a study of

12         Medicaid buy-in programs to determine if these

13         programs can be created in this state without

14         expanding the overall Medicaid program budget

15         or if the Medically Needy program can be

16         changed into a Medicaid buy-in program;

17         providing an appropriation for the purpose of

18         contracting to monitor and evaluate clinical

19         practice patterns; providing an appropriation

20         for the purpose of contracting for the database

21         to review real-time utilization of Medicaid

22         services; providing an appropriation for the

23         purpose of developing infrastructure and

24         administrative resources necessary to implement

25         the pilot project as created in s. 409.91211,

26         F.S.; providing an appropriation for developing

27         an encounter data system for Medicaid managed

28         care plans; providing an effective date.

29  

30  Be It Enacted by the Legislature of the State of Florida:

31  

                                  4

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 1         Section 1.  Section 409.912, Florida Statutes, is

 2  amended to read:

 3         409.912  Cost-effective purchasing of health care.--The

 4  agency shall purchase goods and services for Medicaid

 5  recipients in the most cost-effective manner consistent with

 6  the delivery of quality medical care. To ensure that medical

 7  services are effectively utilized, the agency may, in any

 8  case, require a confirmation or second physician's opinion of

 9  the correct diagnosis for purposes of authorizing future

10  services under the Medicaid program. This section does not

11  restrict access to emergency services or poststabilization

12  care services as defined in 42 C.F.R. part 438.114. Such

13  confirmation or second opinion shall be rendered in a manner

14  approved by the agency. The agency shall maximize the use of

15  prepaid per capita and prepaid aggregate fixed-sum basis

16  services when appropriate and other alternative service

17  delivery and reimbursement methodologies, including

18  competitive bidding pursuant to s. 287.057, designed to

19  facilitate the cost-effective purchase of a case-managed

20  continuum of care. The agency shall also require providers to

21  minimize the exposure of recipients to the need for acute

22  inpatient, custodial, and other institutional care and the

23  inappropriate or unnecessary use of high-cost services. The

24  agency shall contract with a vendor to monitor and evaluate

25  the clinical practice patterns of providers in order to

26  identify trends that are outside the normal practice patterns

27  of a provider's professional peers or the national guidelines

28  of a provider's professional association. The vendor must be

29  able to provide information and counseling to a provider whose

30  practice patterns are outside the norms, in consultation with

31  the agency, to improve patient care and reduce inappropriate

                                  5

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 1  utilization. The agency may mandate prior authorization, drug

 2  therapy management, or disease management participation for

 3  certain populations of Medicaid beneficiaries, certain drug

 4  classes, or particular drugs to prevent fraud, abuse, overuse,

 5  and possible dangerous drug interactions. The Pharmaceutical

 6  and Therapeutics Committee shall make recommendations to the

 7  agency on drugs for which prior authorization is required. The

 8  agency shall inform the Pharmaceutical and Therapeutics

 9  Committee of its decisions regarding drugs subject to prior

10  authorization. The agency is authorized to limit the entities

11  it contracts with or enrolls as Medicaid providers by

12  developing a provider network through provider credentialing.

13  The agency may competitively bid single-source-provider

14  contracts if procurement of goods or services results in

15  demonstrated cost savings to the state without limiting access

16  to care. The agency may limit its network based on the

17  assessment of beneficiary access to care, provider

18  availability, provider quality standards, time and distance

19  standards for access to care, the cultural competence of the

20  provider network, demographic characteristics of Medicaid

21  beneficiaries, practice and provider-to-beneficiary standards,

22  appointment wait times, beneficiary use of services, provider

23  turnover, provider profiling, provider licensure history,

24  previous program integrity investigations and findings, peer

25  review, provider Medicaid policy and billing compliance

26  records, clinical and medical record audits, and other

27  factors. Providers shall not be entitled to enrollment in the

28  Medicaid provider network. The agency shall determine

29  instances in which allowing Medicaid beneficiaries to purchase

30  durable medical equipment and other goods is less expensive to

31  the Medicaid program than long-term rental of the equipment or

                                  6

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    Florida Senate - 2005                     CS for CS for SB 838
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 1  goods. The agency may establish rules to facilitate purchases

 2  in lieu of long-term rentals in order to protect against fraud

 3  and abuse in the Medicaid program as defined in s. 409.913.

 4  The agency may is authorized to seek federal waivers necessary

 5  to administer these policies implement this policy.

 6         (1)  The agency shall work with the Department of

 7  Children and Family Services to ensure access of children and

 8  families in the child protection system to needed and

 9  appropriate mental health and substance abuse services.

10         (2)  The agency may enter into agreements with

11  appropriate agents of other state agencies or of any agency of

12  the Federal Government and accept such duties in respect to

13  social welfare or public aid as may be necessary to implement

14  the provisions of Title XIX of the Social Security Act and ss.

15  409.901-409.920.

16         (3)  The agency may contract with health maintenance

17  organizations certified pursuant to part I of chapter 641 for

18  the provision of services to recipients.

19         (4)  The agency may contract with:

20         (a)  An entity that provides no prepaid health care

21  services other than Medicaid services under contract with the

22  agency and which is owned and operated by a county, county

23  health department, or county-owned and operated hospital to

24  provide health care services on a prepaid or fixed-sum basis

25  to recipients, which entity may provide such prepaid services

26  either directly or through arrangements with other providers.

27  Such prepaid health care services entities must be licensed

28  under parts I and III by January 1, 1998, and until then are

29  exempt from the provisions of part I of chapter 641. An entity

30  recognized under this paragraph which demonstrates to the

31  satisfaction of the Office of Insurance Regulation of the

                                  7

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 1  Financial Services Commission that it is backed by the full

 2  faith and credit of the county in which it is located may be

 3  exempted from s. 641.225.

 4         (b)  An entity that is providing comprehensive

 5  behavioral health care services to certain Medicaid recipients

 6  through a capitated, prepaid arrangement pursuant to the

 7  federal waiver provided for by s. 409.905(5). Such an entity

 8  must be licensed under chapter 624, chapter 636, or chapter

 9  641 and must possess the clinical systems and operational

10  competence to manage risk and provide comprehensive behavioral

11  health care to Medicaid recipients. As used in this paragraph,

12  the term "comprehensive behavioral health care services" means

13  covered mental health and substance abuse treatment services

14  that are available to Medicaid recipients. The secretary of

15  the Department of Children and Family Services shall approve

16  provisions of procurements related to children in the

17  department's care or custody prior to enrolling such children

18  in a prepaid behavioral health plan. Any contract awarded

19  under this paragraph must be competitively procured. In

20  developing the behavioral health care prepaid plan procurement

21  document, the agency shall ensure that the procurement

22  document requires the contractor to develop and implement a

23  plan to ensure compliance with s. 394.4574 related to services

24  provided to residents of licensed assisted living facilities

25  that hold a limited mental health license. Except as provided

26  in subparagraph 8., the agency shall seek federal approval to

27  contract with a single entity meeting these requirements to

28  provide comprehensive behavioral health care services to all

29  Medicaid recipients not enrolled in a managed care plan in an

30  AHCA area. Each entity must offer sufficient choice of

31  providers in its network to ensure recipient access to care

                                  8

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 1  and the opportunity to select a provider with whom they are

 2  satisfied. The network shall include all public mental health

 3  hospitals. To ensure unimpaired access to behavioral health

 4  care services by Medicaid recipients, all contracts issued

 5  pursuant to this paragraph shall require 80 percent of the

 6  capitation paid to the managed care plan, including health

 7  maintenance organizations, to be expended for the provision of

 8  behavioral health care services. In the event the managed care

 9  plan expends less than 80 percent of the capitation paid

10  pursuant to this paragraph for the provision of behavioral

11  health care services, the difference shall be returned to the

12  agency. The agency shall provide the managed care plan with a

13  certification letter indicating the amount of capitation paid

14  during each calendar year for the provision of behavioral

15  health care services pursuant to this section. The agency may

16  reimburse for substance abuse treatment services on a

17  fee-for-service basis until the agency finds that adequate

18  funds are available for capitated, prepaid arrangements.

19         1.  By January 1, 2001, the agency shall modify the

20  contracts with the entities providing comprehensive inpatient

21  and outpatient mental health care services to Medicaid

22  recipients in Hillsborough, Highlands, Hardee, Manatee, and

23  Polk Counties, to include substance abuse treatment services.

24         2.  By July 1, 2003, the agency and the Department of

25  Children and Family Services shall execute a written agreement

26  that requires collaboration and joint development of all

27  policy, budgets, procurement documents, contracts, and

28  monitoring plans that have an impact on the state and Medicaid

29  community mental health and targeted case management programs.

30         3.  Except as provided in subparagraph 8., by July 1,

31  2006, the agency and the Department of Children and Family

                                  9

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 1  Services shall contract with managed care entities in each

 2  AHCA area except area 6 or arrange to provide comprehensive

 3  inpatient and outpatient mental health and substance abuse

 4  services through capitated prepaid arrangements to all

 5  Medicaid recipients who are eligible to participate in such

 6  plans under federal law and regulation. In AHCA areas where

 7  eligible individuals number less than 150,000, the agency

 8  shall contract with a single managed care plan to provide

 9  comprehensive behavioral health services to all recipients who

10  are not enrolled in a Medicaid health maintenance

11  organization. The agency may contract with more than one

12  comprehensive behavioral health provider to provide care to

13  recipients who are not enrolled in a Medicaid health

14  maintenance organization in AHCA areas where the eligible

15  population exceeds 150,000. Contracts for comprehensive

16  behavioral health providers awarded pursuant to this section

17  shall be competitively procured. Both for-profit and

18  not-for-profit corporations shall be eligible to compete.

19  Managed care plans contracting with the agency under

20  subsection (3) shall provide and receive payment for the same

21  comprehensive behavioral health benefits as provided in AHCA

22  rules, including handbooks incorporated by reference.

23         4.  By October 1, 2003, the agency and the department

24  shall submit a plan to the Governor, the President of the

25  Senate, and the Speaker of the House of Representatives which

26  provides for the full implementation of capitated prepaid

27  behavioral health care in all areas of the state.

28         a.  Implementation shall begin in 2003 in those AHCA

29  areas of the state where the agency is able to establish

30  sufficient capitation rates.

31  

                                  10

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 1         b.  If the agency determines that the proposed

 2  capitation rate in any area is insufficient to provide

 3  appropriate services, the agency may adjust the capitation

 4  rate to ensure that care will be available. The agency and the

 5  department may use existing general revenue to address any

 6  additional required match but may not over-obligate existing

 7  funds on an annualized basis.

 8         c.  Subject to any limitations provided for in the

 9  General Appropriations Act, the agency, in compliance with

10  appropriate federal authorization, shall develop policies and

11  procedures that allow for certification of local and state

12  funds.

13         5.  Children residing in a statewide inpatient

14  psychiatric program, or in a Department of Juvenile Justice or

15  a Department of Children and Family Services residential

16  program approved as a Medicaid behavioral health overlay

17  services provider shall not be included in a behavioral health

18  care prepaid health plan or any other Medicaid managed care

19  plan pursuant to this paragraph.

20         6.  In converting to a prepaid system of delivery, the

21  agency shall in its procurement document require an entity

22  providing only comprehensive behavioral health care services

23  to prevent the displacement of indigent care patients by

24  enrollees in the Medicaid prepaid health plan providing

25  behavioral health care services from facilities receiving

26  state funding to provide indigent behavioral health care, to

27  facilities licensed under chapter 395 which do not receive

28  state funding for indigent behavioral health care, or

29  reimburse the unsubsidized facility for the cost of behavioral

30  health care provided to the displaced indigent care patient.

31  

                                  11

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 1         7.  Traditional community mental health providers under

 2  contract with the Department of Children and Family Services

 3  pursuant to part IV of chapter 394, child welfare providers

 4  under contract with the Department of Children and Family

 5  Services in areas 1 and 6, and inpatient mental health

 6  providers licensed pursuant to chapter 395 must be offered an

 7  opportunity to accept or decline a contract to participate in

 8  any provider network for prepaid behavioral health services.

 9         8.  For fiscal year 2004-2005, all Medicaid eligible

10  children, except children in areas 1 and 6, whose cases are

11  open for child welfare services in the HomeSafeNet system,

12  shall be enrolled in MediPass or in Medicaid fee-for-service

13  and all their behavioral health care services including

14  inpatient, outpatient psychiatric, community mental health,

15  and case management shall be reimbursed on a fee-for-service

16  basis. Beginning July 1, 2005, such children, who are open for

17  child welfare services in the HomeSafeNet system, shall

18  receive their behavioral health care services through a

19  specialty prepaid plan operated by community-based lead

20  agencies either through a single agency or formal agreements

21  among several agencies. The specialty prepaid plan must result

22  in savings to the state comparable to savings achieved in

23  other Medicaid managed care and prepaid programs. Such plan

24  must provide mechanisms to maximize state and local revenues.

25  The specialty prepaid plan shall be developed by the agency

26  and the Department of Children and Family Services. The agency

27  is authorized to seek any federal waivers to implement this

28  initiative.

29         (c)  A federally qualified health center or an entity

30  owned by one or more federally qualified health centers or an

31  entity owned by other migrant and community health centers

                                  12

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 1  receiving non-Medicaid financial support from the Federal

 2  Government to provide health care services on a prepaid or

 3  fixed-sum basis to recipients. Such prepaid health care

 4  services entity must be licensed under parts I and III of

 5  chapter 641, but shall be prohibited from serving Medicaid

 6  recipients on a prepaid basis, until such licensure has been

 7  obtained. However, such an entity is exempt from s. 641.225 if

 8  the entity meets the requirements specified in subsections

 9  (17) and (18).

10         (d)  A provider service network may be reimbursed on a

11  fee-for-service or prepaid basis. A provider service network

12  which is reimbursed by the agency on a prepaid basis shall be

13  exempt from parts I and III of chapter 641, but must meet

14  appropriate financial reserve, quality assurance, and patient

15  rights requirements as established by the agency. The agency

16  shall award contracts on a competitive bid basis and shall

17  select bidders based upon price and quality of care. Medicaid

18  recipients assigned to a demonstration project shall be chosen

19  equally from those who would otherwise have been assigned to

20  prepaid plans and MediPass. The agency is authorized to seek

21  federal Medicaid waivers as necessary to implement the

22  provisions of this section. Any contract previously awarded to

23  a provider service network operated by a hospital pursuant to

24  this subsection shall remain in effect for a period of 3 years

25  following the current contract-expiration date, regardless of

26  any contractual provisions to the contrary. A provider service

27  network is a network established or organized and operated by

28  a health care provider, or group of affiliated health care

29  providers, which provides a substantial proportion of the

30  health care items and services under a contract directly

31  through the provider or affiliated group of providers and may

                                  13

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 1  make arrangements with physicians or other health care

 2  professionals, health care institutions, or any combination of

 3  such individuals or institutions to assume all or part of the

 4  financial risk on a prospective basis for the provision of

 5  basic health services by the physicians, by other health

 6  professionals, or through the institutions. The health care

 7  providers must have a controlling interest in the governing

 8  body of the provider service network organization.

 9         (e)  An entity that provides only comprehensive

10  behavioral health care services to certain Medicaid recipients

11  through an administrative services organization agreement.

12  Such an entity must possess the clinical systems and

13  operational competence to provide comprehensive health care to

14  Medicaid recipients. As used in this paragraph, the term

15  "comprehensive behavioral health care services" means covered

16  mental health and substance abuse treatment services that are

17  available to Medicaid recipients. Any contract awarded under

18  this paragraph must be competitively procured. The agency must

19  ensure that Medicaid recipients have available the choice of

20  at least two managed care plans for their behavioral health

21  care services.

22         (f)  An entity that provides in-home physician services

23  to test the cost-effectiveness of enhanced home-based medical

24  care to Medicaid recipients with degenerative neurological

25  diseases and other diseases or disabling conditions associated

26  with high costs to Medicaid. The program shall be designed to

27  serve very disabled persons and to reduce Medicaid reimbursed

28  costs for inpatient, outpatient, and emergency department

29  services. The agency shall contract with vendors on a

30  risk-sharing basis.

31  

                                  14

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 1         (g)  Children's provider networks that provide care

 2  coordination and care management for Medicaid-eligible

 3  pediatric patients, primary care, authorization of specialty

 4  care, and other urgent and emergency care through organized

 5  providers designed to service Medicaid eligibles under age 18

 6  and pediatric emergency departments' diversion programs. The

 7  networks shall provide after-hour operations, including

 8  evening and weekend hours, to promote, when appropriate, the

 9  use of the children's networks rather than hospital emergency

10  departments.

11         (h)  An entity authorized in s. 430.205 to contract

12  with the agency and the Department of Elderly Affairs to

13  provide health care and social services on a prepaid or

14  fixed-sum basis to elderly recipients. Such prepaid health

15  care services entities are exempt from the provisions of part

16  I of chapter 641 for the first 3 years of operation. An entity

17  recognized under this paragraph that demonstrates to the

18  satisfaction of the Office of Insurance Regulation that it is

19  backed by the full faith and credit of one or more counties in

20  which it operates may be exempted from s. 641.225.

21         (i)  A Children's Medical Services Network, as defined

22  in s. 391.021.

23         (5)  By December 1, 2005, the Agency for Health Care

24  Administration, in partnership with the Department of Elderly

25  Affairs, shall create an integrated, fixed-payment delivery

26  system for Medicaid recipients who are 60 years of age or

27  older. Eligible Medicaid recipients may participate in the

28  integrated system on a voluntary basis. The program must

29  transfer all Medicaid services for eligible elderly

30  individuals who choose to participate into an integrated-care

31  management model designed to serve Medicaid recipients in the

                                  15

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 1  community. The program must combine all funding for Medicaid

 2  services provided to individuals 60 years of age or older into

 3  the integrated system, including funds for Medicaid home and

 4  community-based waiver services; all Medicaid services

 5  authorized in ss. 409.905 and 409.906, excluding funds for

 6  Medicaid nursing home services unless the agency is able to

 7  demonstrate how the integration of the funds will improve

 8  coordinated care for these services in a less costly manner;

 9  and Medicare premiums, coinsurance, and deductibles for

10  persons dually eligible for Medicaid and Medicare as

11  prescribed in s. 409.908(13). The agency must begin

12  implementing the integrated system in a pilot area that may

13  only include Orange, Osceola, Lake, and Seminole Counties.

14         (a)  Individuals who are 60 years of age or older and

15  enrolled in the the developmental disabilities waiver program,

16  the family and supported-living waiver program, the project

17  AIDS care waiver program, the traumatic brain injury and

18  spinal cord injury waiver program, the consumer-directed care

19  waiver program, and the program of all-inclusive care for the

20  elderly program, and residents of institutional care

21  facilities for the developmentally disabled, must be excluded

22  from the integrated system.

23         (b)  The program must use a competitive-procurement

24  process to select entities to operate the integrated system.

25  Entities eligible to submit bids include managed care

26  organizations licensed under chapter 641, including entities

27  eligible to participate in the nursing home diversion program,

28  other qualified providers as defined in s. 430.703(7),

29  community care for the elderly lead agencies, and other

30  state-certified community service networks that meet

31  comparable standards as defined by the agency, in consultation

                                  16

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 1  with the Department of Elderly Affairs and the Office of

 2  Insurance Regulation, to be financially solvent and able to

 3  take on financial risk for managed care. Community service

 4  networks that are certified pursuant to the comparable

 5  standards defined by the agency are not required to be

 6  licensed under chapter 641.

 7         (c)  The agency must ensure that the

 8  capitation-rate-setting methodology for the integrated system

 9  is actuarially sound and reflects the intent to provide

10  quality care in the least-restrictive setting. The agency must

11  also require integrated-system providers to develop a

12  credentialing system for service providers and to contract

13  with all Gold Seal nursing homes, where feasible, and exclude,

14  where feasible, chronically poor-performing facilities and

15  providers as defined by the agency. The integrated system must

16  provide that if the recipient resides in a noncontracted

17  residential facility licensed under chapter 400 at the time

18  the integrated system is initiated, the recipient must be

19  permitted to continue to reside in the noncontracted facility

20  as long as the recipient desires. The integrated system must

21  also provide that, in the absence of a contract between the

22  integrated-system provider and the residential facility

23  licensed under chapter 400, current Medicaid rates must

24  prevail. The agency and the Department of Elderly Affairs must

25  jointly develop procedures to manage the services provided

26  through the integrated system in order to ensure quality and

27  recipient choice.

28         (d)  The agency may seek federal waivers and adopt

29  rules as necessary to administer the integrated system. By

30  October 1, 2003, the agency and the department shall, to the

31  extent feasible, develop a plan for implementing new Medicaid

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 1  procedure codes for emergency and crisis care, supportive

 2  residential services, and other services designed to maximize

 3  the use of Medicaid funds for Medicaid-eligible recipients.

 4  The agency shall include in the agreement developed pursuant

 5  to subsection (4) a provision that ensures that the match

 6  requirements for these new procedure codes are met by

 7  certifying eligible general revenue or local funds that are

 8  currently expended on these services by the department with

 9  contracted alcohol, drug abuse, and mental health providers.

10  The plan must describe specific procedure codes to be

11  implemented, a projection of the number of procedures to be

12  delivered during fiscal year 2003-2004, and a financial

13  analysis that describes the certified match procedures, and

14  accountability mechanisms, projects the earnings associated

15  with these procedures, and describes the sources of state

16  match. This plan may not be implemented in any part until

17  approved by the Legislative Budget Commission. If such

18  approval has not occurred by December 31, 2003, the plan shall

19  be submitted for consideration by the 2004 Legislature.

20         (6)  The agency may contract with any public or private

21  entity otherwise authorized by this section on a prepaid or

22  fixed-sum basis for the provision of health care services to

23  recipients. An entity may provide prepaid services to

24  recipients, either directly or through arrangements with other

25  entities, if each entity involved in providing services:

26         (a)  Is organized primarily for the purpose of

27  providing health care or other services of the type regularly

28  offered to Medicaid recipients;

29         (b)  Ensures that services meet the standards set by

30  the agency for quality, appropriateness, and timeliness;

31  

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 1         (c)  Makes provisions satisfactory to the agency for

 2  insolvency protection and ensures that neither enrolled

 3  Medicaid recipients nor the agency will be liable for the

 4  debts of the entity;

 5         (d)  Submits to the agency, if a private entity, a

 6  financial plan that the agency finds to be fiscally sound and

 7  that provides for working capital in the form of cash or

 8  equivalent liquid assets excluding revenues from Medicaid

 9  premium payments equal to at least the first 3 months of

10  operating expenses or $200,000, whichever is greater;

11         (e)  Furnishes evidence satisfactory to the agency of

12  adequate liability insurance coverage or an adequate plan of

13  self-insurance to respond to claims for injuries arising out

14  of the furnishing of health care;

15         (f)  Provides, through contract or otherwise, for

16  periodic review of its medical facilities and services, as

17  required by the agency; and

18         (g)  Provides organizational, operational, financial,

19  and other information required by the agency.

20         (7)  The agency may contract on a prepaid or fixed-sum

21  basis with any health insurer that:

22         (a)  Pays for health care services provided to enrolled

23  Medicaid recipients in exchange for a premium payment paid by

24  the agency;

25         (b)  Assumes the underwriting risk; and

26         (c)  Is organized and licensed under applicable

27  provisions of the Florida Insurance Code and is currently in

28  good standing with the Office of Insurance Regulation.

29         (8)  The agency may contract on a prepaid or fixed-sum

30  basis with an exclusive provider organization to provide

31  health care services to Medicaid recipients provided that the

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 1  exclusive provider organization meets applicable managed care

 2  plan requirements in this section, ss. 409.9122, 409.9123,

 3  409.9128, and 627.6472, and other applicable provisions of

 4  law.

 5         (9)  The Agency for Health Care Administration may

 6  provide cost-effective purchasing of chiropractic services on

 7  a fee-for-service basis to Medicaid recipients through

 8  arrangements with a statewide chiropractic preferred provider

 9  organization incorporated in this state as a not-for-profit

10  corporation. The agency shall ensure that the benefit limits

11  and prior authorization requirements in the current Medicaid

12  program shall apply to the services provided by the

13  chiropractic preferred provider organization.

14         (10)  The agency shall not contract on a prepaid or

15  fixed-sum basis for Medicaid services with an entity which

16  knows or reasonably should know that any officer, director,

17  agent, managing employee, or owner of stock or beneficial

18  interest in excess of 5 percent common or preferred stock, or

19  the entity itself, has been found guilty of, regardless of

20  adjudication, or entered a plea of nolo contendere, or guilty,

21  to:

22         (a)  Fraud;

23         (b)  Violation of federal or state antitrust statutes,

24  including those proscribing price fixing between competitors

25  and the allocation of customers among competitors;

26         (c)  Commission of a felony involving embezzlement,

27  theft, forgery, income tax evasion, bribery, falsification or

28  destruction of records, making false statements, receiving

29  stolen property, making false claims, or obstruction of

30  justice; or

31  

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 1         (d)  Any crime in any jurisdiction which directly

 2  relates to the provision of health services on a prepaid or

 3  fixed-sum basis.

 4         (11)  The agency, after notifying the Legislature, may

 5  apply for waivers of applicable federal laws and regulations

 6  as necessary to implement more appropriate systems of health

 7  care for Medicaid recipients and reduce the cost of the

 8  Medicaid program to the state and federal governments and

 9  shall implement such programs, after legislative approval,

10  within a reasonable period of time after federal approval.

11  These programs must be designed primarily to reduce the need

12  for inpatient care, custodial care and other long-term or

13  institutional care, and other high-cost services.

14         (a)  Prior to seeking legislative approval of such a

15  waiver as authorized by this subsection, the agency shall

16  provide notice and an opportunity for public comment. Notice

17  shall be provided to all persons who have made requests of the

18  agency for advance notice and shall be published in the

19  Florida Administrative Weekly not less than 28 days prior to

20  the intended action.

21         (b)  Notwithstanding s. 216.292, funds that are

22  appropriated to the Department of Elderly Affairs for the

23  Assisted Living for the Elderly Medicaid waiver and are not

24  expended shall be transferred to the agency to fund

25  Medicaid-reimbursed nursing home care.

26         (12)  The agency shall establish a postpayment

27  utilization control program designed to identify recipients

28  who may inappropriately overuse or underuse Medicaid services

29  and shall provide methods to correct such misuse.

30         (13)  The agency shall develop and provide coordinated

31  systems of care for Medicaid recipients and may contract with

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 1  public or private entities to develop and administer such

 2  systems of care among public and private health care providers

 3  in a given geographic area.

 4         (14)(a)  The agency shall operate or contract for the

 5  operation of utilization management and incentive systems

 6  designed to encourage cost-effective use services.

 7         (b)  The agency shall develop a procedure by which

 8  health care providers and service vendors can provide the

 9  Medicaid program with methodologically valid data that

10  demonstrates whether a particular good or service can offset

11  the cost of providing the good or service in an alternative

12  setting or through other means and therefore should receive a

13  higher reimbursement. Any data provided to the agency for such

14  purpose must demonstrate that for every $1 increase in

15  reimbursement rates for the good or service there will be an

16  offset of at least $2 from the decrease in the cost of

17  providing the good or service through the traditional method.

18  The agency shall be the final arbitrator of the cost-benefit

19  analysis and must determine whether the increased

20  reimbursement for a particular good or service offsets the

21  cost of other goods or services in the Medicaid program. If

22  the agency determines that the increased reimbursement is

23  cost-effective, the agency shall recommend a change in the

24  reimbursement schedule for that particular good or service.

25  If, within 12 months after implementing any rate change under

26  this procedure, the agency determines that costs were not

27  offset by the increased reimbursement schedule, the agency may

28  revert to the former reimbursement schedule for the particular

29  good or service.

30         (15)(a)  The agency shall operate the Comprehensive

31  Assessment and Review for Long-Term Care Services (CARES)

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 1  nursing facility preadmission screening program to ensure that

 2  Medicaid payment for nursing facility care is made only for

 3  individuals whose conditions require such care and to ensure

 4  that long-term care services are provided in the setting most

 5  appropriate to the needs of the person and in the most

 6  economical manner possible. The CARES program shall also

 7  ensure that individuals participating in Medicaid home and

 8  community-based waiver programs meet criteria for those

 9  programs, consistent with approved federal waivers.

10         (b)  The agency shall operate the CARES program through

11  an interagency agreement with the Department of Elderly

12  Affairs. The agency, in consultation with the Department of

13  Elderly Affairs, may contract for any function or activity of

14  the CARES program, including any function or activity required

15  by 42 C.F.R. part 483.20, relating to preadmission screening

16  and resident review.

17         (c)  Prior to making payment for nursing facility

18  services for a Medicaid recipient, the agency must verify that

19  the nursing facility preadmission screening program has

20  determined that the individual requires nursing facility care

21  and that the individual cannot be safely served in

22  community-based programs. The nursing facility preadmission

23  screening program shall refer a Medicaid recipient to a

24  community-based program if the individual could be safely

25  served at a lower cost and the recipient chooses to

26  participate in such program. For individuals whose nursing

27  home stay is initially funded by Medicare and Medicare

28  coverage is being terminated for lack of progress towards

29  rehabilitation, CARES staff shall consult with the person

30  making the determination of progress toward rehabilitation to

31  ensure that the recipient is not being inappropriately

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 1  disqualified from Medicare coverage. If, in their professional

 2  judgment, CARES staff believes that a Medicare beneficiary is

 3  still making progress toward rehabilitation, they may assist

 4  the Medicare beneficiary with an appeal of the

 5  disqualification from Medicare coverage.

 6         (d)  For the purpose of initiating immediate

 7  prescreening and diversion assistance for individuals residing

 8  in nursing homes and in order to make families aware of

 9  alternative long-term care resources so that they may choose a

10  more cost-effective setting for long-term placement, CARES

11  staff shall conduct an assessment and review of a sample of

12  individuals whose nursing home stay is expected to exceed 20

13  days, regardless of the initial funding source for the nursing

14  home placement. CARES staff shall provide counseling and

15  referral services to these individuals regarding choosing

16  appropriate long-term care alternatives. This paragraph does

17  not apply to continuing care facilities licensed under chapter

18  651 or to retirement communities that provide a combination of

19  nursing home, independent living, and other long-term care

20  services.

21         (e)  By January 15 of each year, the agency shall

22  submit a report to the Legislature and the Office of

23  Long-Term-Care Policy describing the operations of the CARES

24  program. The report must describe:

25         1.  Rate of diversion to community alternative

26  programs;

27         2.  CARES program staffing needs to achieve additional

28  diversions;

29         3.  Reasons the program is unable to place individuals

30  in less restrictive settings when such individuals desired

31  such services and could have been served in such settings;

                                  24

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 1         4.  Barriers to appropriate placement, including

 2  barriers due to policies or operations of other agencies or

 3  state-funded programs; and

 4         5.  Statutory changes necessary to ensure that

 5  individuals in need of long-term care services receive care in

 6  the least restrictive environment.

 7         (f)  The Department of Elderly Affairs shall track

 8  individuals over time who are assessed under the CARES program

 9  and who are diverted from nursing home placement. By January

10  15 of each year, the department shall submit to the

11  Legislature and the Office of Long-Term-Care Policy a

12  longitudinal study of the individuals who are diverted from

13  nursing home placement. The study must include:

14         1.  The demographic characteristics of the individuals

15  assessed and diverted from nursing home placement, including,

16  but not limited to, age, race, gender, frailty, caregiver

17  status, living arrangements, and geographic location;

18         2.  A summary of community services provided to

19  individuals for 1 year after assessment and diversion;

20         3.  A summary of inpatient hospital admissions for

21  individuals who have been diverted; and

22         4.  A summary of the length of time between diversion

23  and subsequent entry into a nursing home or death.

24         (g)  By July 1, 2005, the department and the Agency for

25  Health Care Administration shall report to the President of

26  the Senate and the Speaker of the House of Representatives

27  regarding the impact to the state of modifying level-of-care

28  criteria to eliminate the Intermediate II level of care.

29         (16)(a)  The agency shall identify health care

30  utilization and price patterns within the Medicaid program

31  which are not cost-effective or medically appropriate and

                                  25

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 1  assess the effectiveness of new or alternate methods of

 2  providing and monitoring service, and may implement such

 3  methods as it considers appropriate. Such methods may include

 4  disease management initiatives, an integrated and systematic

 5  approach for managing the health care needs of recipients who

 6  are at risk of or diagnosed with a specific disease by using

 7  best practices, prevention strategies, clinical-practice

 8  improvement, clinical interventions and protocols, outcomes

 9  research, information technology, and other tools and

10  resources to reduce overall costs and improve measurable

11  outcomes.

12         (b)  The responsibility of the agency under this

13  subsection shall include the development of capabilities to

14  identify actual and optimal practice patterns; patient and

15  provider educational initiatives; methods for determining

16  patient compliance with prescribed treatments; fraud, waste,

17  and abuse prevention and detection programs; and beneficiary

18  case management programs.

19         1.  The practice pattern identification program shall

20  evaluate practitioner prescribing patterns based on national

21  and regional practice guidelines, comparing practitioners to

22  their peer groups. The agency and its Drug Utilization Review

23  Board shall consult with the Department of Health and a panel

24  of practicing health care professionals consisting of the

25  following: the Speaker of the House of Representatives and the

26  President of the Senate shall each appoint three physicians

27  licensed under chapter 458 or chapter 459; and the Governor

28  shall appoint two pharmacists licensed under chapter 465 and

29  one dentist licensed under chapter 466 who is an oral surgeon.

30  Terms of the panel members shall expire at the discretion of

31  the appointing official. The panel shall begin its work by

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 1  August 1, 1999, regardless of the number of appointments made

 2  by that date. The advisory panel shall be responsible for

 3  evaluating treatment guidelines and recommending ways to

 4  incorporate their use in the practice pattern identification

 5  program. Practitioners who are prescribing inappropriately or

 6  inefficiently, as determined by the agency, may have their

 7  prescribing of certain drugs subject to prior authorization or

 8  may be terminated from all participation in the Medicaid

 9  program.

10         2.  The agency shall also develop educational

11  interventions designed to promote the proper use of

12  medications by providers and beneficiaries.

13         3.  The agency shall implement a pharmacy fraud, waste,

14  and abuse initiative that may include a surety bond or letter

15  of credit requirement for participating pharmacies, enhanced

16  provider auditing practices, the use of additional fraud and

17  abuse software, recipient management programs for

18  beneficiaries inappropriately using their benefits, and other

19  steps that will eliminate provider and recipient fraud, waste,

20  and abuse. The initiative shall address enforcement efforts to

21  reduce the number and use of counterfeit prescriptions.

22         4.  By September 30, 2002, the agency shall contract

23  with an entity in the state to implement a wireless handheld

24  clinical pharmacology drug information database for

25  practitioners. The initiative shall be designed to enhance the

26  agency's efforts to reduce fraud, abuse, and errors in the

27  prescription drug benefit program and to otherwise further the

28  intent of this paragraph.

29         5.  By September 30, 2005, the agency shall contract

30  with an entity to design a database of clinical utilization

31  information or electronic medical records for Medicaid

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 1  providers. This system must be web-based and allow providers

 2  to review on a real-time basis the utilization of Medicaid

 3  services, including, but not limited to, physician office

 4  visits, inpatient and outpatient hospitalizations, laboratory

 5  and pathology services, radiological and other imaging

 6  services, dental care, and patterns of dispensing prescription

 7  drugs in order to coordinate care and identify potential fraud

 8  and abuse.

 9         6.  By January 1, 2006, the agency shall provide

10  expanded statewide disease-management programs to provide case

11  management for persons with chronic diseases including

12  diabetes, hypertension, human immunodeficiency virus/acquired

13  immune deficiency syndrome, asthma, congestive heart failure,

14  hemophilia, end-stage renal disease or chronic kidney disease,

15  cancer, sickle cell anemia, chronic fatigue syndrome, and

16  chronic pain. In selecting disease-management vendors,

17  preference must be given to disease-management organizations

18  that are able to provide case management across disease states

19  through coordinated efforts between physicians and

20  pharmacists. The expansion must take two primary forms. The

21  first type of expansion must emphasis changes in clinical

22  practice patterns of physicians and pharmacists in order to

23  meet evidence-based medicine standards and best-practice

24  guidelines for each physician's specialty. The second

25  expansion must emphasize changes in behavior of persons with

26  chronic medical conditions. The expansion must include a

27  randomly assigned, experimental design to evaluate short-term

28  changes in utilization patterns for Medicaid services and

29  clinical outcome measures. The agency shall use an

30  independent, third party to evaluate the expansion of the

31  disease-management program. The agency shall select the

                                  28

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 1  geographic areas in which to expand the disease-management

 2  program, estimate the costs to implement each expansion, and

 3  develop a timeline for statewide implementation. Based on the

 4  evaluation of the expansion, the agency may recommend

 5  statewide expansion of the disease-management programs having

 6  the best fiscal and clinical outcomes.

 7         7.5.  The agency may apply for any federal waivers

 8  needed to administer implement this paragraph.

 9         (17)  An entity contracting on a prepaid or fixed-sum

10  basis shall, in addition to meeting any applicable statutory

11  surplus requirements, also maintain at all times in the form

12  of cash, investments that mature in less than 180 days

13  allowable as admitted assets by the Office of Insurance

14  Regulation, and restricted funds or deposits controlled by the

15  agency or the Office of Insurance Regulation, a surplus amount

16  equal to one-and-one-half times the entity's monthly Medicaid

17  prepaid revenues. As used in this subsection, the term

18  "surplus" means the entity's total assets minus total

19  liabilities. If an entity's surplus falls below an amount

20  equal to one-and-one-half times the entity's monthly Medicaid

21  prepaid revenues, the agency shall prohibit the entity from

22  engaging in marketing and preenrollment activities, shall

23  cease to process new enrollments, and shall not renew the

24  entity's contract until the required balance is achieved. The

25  requirements of this subsection do not apply:

26         (a)  Where a public entity agrees to fund any deficit

27  incurred by the contracting entity; or

28         (b)  Where the entity's performance and obligations are

29  guaranteed in writing by a guaranteeing organization which:

30         1.  Has been in operation for at least 5 years and has

31  assets in excess of $50 million; or

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 1         2.  Submits a written guarantee acceptable to the

 2  agency which is irrevocable during the term of the contracting

 3  entity's contract with the agency and, upon termination of the

 4  contract, until the agency receives proof of satisfaction of

 5  all outstanding obligations incurred under the contract.

 6         (18)(a)  The agency may require an entity contracting

 7  on a prepaid or fixed-sum basis to establish a restricted

 8  insolvency protection account with a federally guaranteed

 9  financial institution licensed to do business in this state.

10  The entity shall deposit into that account 5 percent of the

11  capitation payments made by the agency each month until a

12  maximum total of 2 percent of the total current contract

13  amount is reached. The restricted insolvency protection

14  account may be drawn upon with the authorized signatures of

15  two persons designated by the entity and two representatives

16  of the agency. If the agency finds that the entity is

17  insolvent, the agency may draw upon the account solely with

18  the two authorized signatures of representatives of the

19  agency, and the funds may be disbursed to meet financial

20  obligations incurred by the entity under the prepaid contract.

21  If the contract is terminated, expired, or not continued, the

22  account balance must be released by the agency to the entity

23  upon receipt of proof of satisfaction of all outstanding

24  obligations incurred under this contract.

25         (b)  The agency may waive the insolvency protection

26  account requirement in writing when evidence is on file with

27  the agency of adequate insolvency insurance and reinsurance

28  that will protect enrollees if the entity becomes unable to

29  meet its obligations.

30         (19)  An entity that contracts with the agency on a

31  prepaid or fixed-sum basis for the provision of Medicaid

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 1  services shall reimburse any hospital or physician that is

 2  outside the entity's authorized geographic service area as

 3  specified in its contract with the agency, and that provides

 4  services authorized by the entity to its members, at a rate

 5  negotiated with the hospital or physician for the provision of

 6  services or according to the lesser of the following:

 7         (a)  The usual and customary charges made to the

 8  general public by the hospital or physician; or

 9         (b)  The Florida Medicaid reimbursement rate

10  established for the hospital or physician.

11         (20)  When a merger or acquisition of a Medicaid

12  prepaid contractor has been approved by the Office of

13  Insurance Regulation pursuant to s. 628.4615, the agency shall

14  approve the assignment or transfer of the appropriate Medicaid

15  prepaid contract upon request of the surviving entity of the

16  merger or acquisition if the contractor and the other entity

17  have been in good standing with the agency for the most recent

18  12-month period, unless the agency determines that the

19  assignment or transfer would be detrimental to the Medicaid

20  recipients or the Medicaid program. To be in good standing, an

21  entity must not have failed accreditation or committed any

22  material violation of the requirements of s. 641.52 and must

23  meet the Medicaid contract requirements. For purposes of this

24  section, a merger or acquisition means a change in controlling

25  interest of an entity, including an asset or stock purchase.

26         (21)  Any entity contracting with the agency pursuant

27  to this section to provide health care services to Medicaid

28  recipients is prohibited from engaging in any of the following

29  practices or activities:

30  

31  

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 1         (a)  Practices that are discriminatory, including, but

 2  not limited to, attempts to discourage participation on the

 3  basis of actual or perceived health status.

 4         (b)  Activities that could mislead or confuse

 5  recipients, or misrepresent the organization, its marketing

 6  representatives, or the agency. Violations of this paragraph

 7  include, but are not limited to:

 8         1.  False or misleading claims that marketing

 9  representatives are employees or representatives of the state

10  or county, or of anyone other than the entity or the

11  organization by whom they are reimbursed.

12         2.  False or misleading claims that the entity is

13  recommended or endorsed by any state or county agency, or by

14  any other organization which has not certified its endorsement

15  in writing to the entity.

16         3.  False or misleading claims that the state or county

17  recommends that a Medicaid recipient enroll with an entity.

18         4.  Claims that a Medicaid recipient will lose benefits

19  under the Medicaid program, or any other health or welfare

20  benefits to which the recipient is legally entitled, if the

21  recipient does not enroll with the entity.

22         (c)  Granting or offering of any monetary or other

23  valuable consideration for enrollment, except as authorized by

24  subsection (24).

25         (d)  Door-to-door solicitation of recipients who have

26  not contacted the entity or who have not invited the entity to

27  make a presentation.

28         (e)  Solicitation of Medicaid recipients by marketing

29  representatives stationed in state offices unless approved and

30  supervised by the agency or its agent and approved by the

31  affected state agency when solicitation occurs in an office of

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 1  the state agency. The agency shall ensure that marketing

 2  representatives stationed in state offices shall market their

 3  managed care plans to Medicaid recipients only in designated

 4  areas and in such a way as to not interfere with the

 5  recipients' activities in the state office.

 6         (f)  Enrollment of Medicaid recipients.

 7         (22)  The agency may impose a fine for a violation of

 8  this section or the contract with the agency by a person or

 9  entity that is under contract with the agency. With respect to

10  any nonwillful violation, such fine shall not exceed $2,500

11  per violation. In no event shall such fine exceed an aggregate

12  amount of $10,000 for all nonwillful violations arising out of

13  the same action. With respect to any knowing and willful

14  violation of this section or the contract with the agency, the

15  agency may impose a fine upon the entity in an amount not to

16  exceed $20,000 for each such violation. In no event shall such

17  fine exceed an aggregate amount of $100,000 for all knowing

18  and willful violations arising out of the same action.

19         (23)  A health maintenance organization or a person or

20  entity exempt from chapter 641 that is under contract with the

21  agency for the provision of health care services to Medicaid

22  recipients may not use or distribute marketing materials used

23  to solicit Medicaid recipients, unless such materials have

24  been approved by the agency. The provisions of this subsection

25  do not apply to general advertising and marketing materials

26  used by a health maintenance organization to solicit both

27  non-Medicaid subscribers and Medicaid recipients.

28         (24)  Upon approval by the agency, health maintenance

29  organizations and persons or entities exempt from chapter 641

30  that are under contract with the agency for the provision of

31  health care services to Medicaid recipients may be permitted

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 1  within the capitation rate to provide additional health

 2  benefits that the agency has found are of high quality, are

 3  practicably available, provide reasonable value to the

 4  recipient, and are provided at no additional cost to the

 5  state.

 6         (25)  The agency shall utilize the statewide health

 7  maintenance organization complaint hotline for the purpose of

 8  investigating and resolving Medicaid and prepaid health plan

 9  complaints, maintaining a record of complaints and confirmed

10  problems, and receiving disenrollment requests made by

11  recipients.

12         (26)  The agency shall require the publication of the

13  health maintenance organization's and the prepaid health

14  plan's consumer services telephone numbers and the "800"

15  telephone number of the statewide health maintenance

16  organization complaint hotline on each Medicaid identification

17  card issued by a health maintenance organization or prepaid

18  health plan contracting with the agency to serve Medicaid

19  recipients and on each subscriber handbook issued to a

20  Medicaid recipient.

21         (27)  The agency shall establish a health care quality

22  improvement system for those entities contracting with the

23  agency pursuant to this section, incorporating all the

24  standards and guidelines developed by the Medicaid Bureau of

25  the Health Care Financing Administration as a part of the

26  quality assurance reform initiative. The system shall include,

27  but need not be limited to, the following:

28         (a)  Guidelines for internal quality assurance

29  programs, including standards for:

30         1.  Written quality assurance program descriptions.

31  

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 1         2.  Responsibilities of the governing body for

 2  monitoring, evaluating, and making improvements to care.

 3         3.  An active quality assurance committee.

 4         4.  Quality assurance program supervision.

 5         5.  Requiring the program to have adequate resources to

 6  effectively carry out its specified activities.

 7         6.  Provider participation in the quality assurance

 8  program.

 9         7.  Delegation of quality assurance program activities.

10         8.  Credentialing and recredentialing.

11         9.  Enrollee rights and responsibilities.

12         10.  Availability and accessibility to services and

13  care.

14         11.  Ambulatory care facilities.

15         12.  Accessibility and availability of medical records,

16  as well as proper recordkeeping and process for record review.

17         13.  Utilization review.

18         14.  A continuity of care system.

19         15.  Quality assurance program documentation.

20         16.  Coordination of quality assurance activity with

21  other management activity.

22         17.  Delivering care to pregnant women and infants; to

23  elderly and disabled recipients, especially those who are at

24  risk of institutional placement; to persons with developmental

25  disabilities; and to adults who have chronic, high-cost

26  medical conditions.

27         (b)  Guidelines which require the entities to conduct

28  quality-of-care studies which:

29         1.  Target specific conditions and specific health

30  service delivery issues for focused monitoring and evaluation.

31  

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 1         2.  Use clinical care standards or practice guidelines

 2  to objectively evaluate the care the entity delivers or fails

 3  to deliver for the targeted clinical conditions and health

 4  services delivery issues.

 5         3.  Use quality indicators derived from the clinical

 6  care standards or practice guidelines to screen and monitor

 7  care and services delivered.

 8         (c)  Guidelines for external quality review of each

 9  contractor which require: focused studies of patterns of care;

10  individual care review in specific situations; and followup

11  activities on previous pattern-of-care study findings and

12  individual-care-review findings. In designing the external

13  quality review function and determining how it is to operate

14  as part of the state's overall quality improvement system, the

15  agency shall construct its external quality review

16  organization and entity contracts to address each of the

17  following:

18         1.  Delineating the role of the external quality review

19  organization.

20         2.  Length of the external quality review organization

21  contract with the state.

22         3.  Participation of the contracting entities in

23  designing external quality review organization review

24  activities.

25         4.  Potential variation in the type of clinical

26  conditions and health services delivery issues to be studied

27  at each plan.

28         5.  Determining the number of focused pattern-of-care

29  studies to be conducted for each plan.

30         6.  Methods for implementing focused studies.

31         7.  Individual care review.

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 1         8.  Followup activities.

 2         (28)  In order to ensure that children receive health

 3  care services for which an entity has already been

 4  compensated, an entity contracting with the agency pursuant to

 5  this section shall achieve an annual Early and Periodic

 6  Screening, Diagnosis, and Treatment (EPSDT) Service screening

 7  rate of at least 60 percent for those recipients continuously

 8  enrolled for at least 8 months. The agency shall develop a

 9  method by which the EPSDT screening rate shall be calculated.

10  For any entity which does not achieve the annual 60 percent

11  rate, the entity must submit a corrective action plan for the

12  agency's approval. If the entity does not meet the standard

13  established in the corrective action plan during the specified

14  timeframe, the agency is authorized to impose appropriate

15  contract sanctions. At least annually, the agency shall

16  publicly release the EPSDT Services screening rates of each

17  entity it has contracted with on a prepaid basis to serve

18  Medicaid recipients.

19         (29)  The agency shall perform enrollments and

20  disenrollments for Medicaid recipients who are eligible for

21  MediPass or managed care plans. Notwithstanding the

22  prohibition contained in paragraph (21)(f), managed care plans

23  may perform preenrollments of Medicaid recipients under the

24  supervision of the agency or its agents. For the purposes of

25  this section, "preenrollment" means the provision of marketing

26  and educational materials to a Medicaid recipient and

27  assistance in completing the application forms, but shall not

28  include actual enrollment into a managed care plan. An

29  application for enrollment shall not be deemed complete until

30  the agency or its agent verifies that the recipient made an

31  informed, voluntary choice. The agency, in cooperation with

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 1  the Department of Children and Family Services, may test new

 2  marketing initiatives to inform Medicaid recipients about

 3  their managed care options at selected sites. The agency shall

 4  report to the Legislature on the effectiveness of such

 5  initiatives. The agency may contract with a third party to

 6  perform managed care plan and MediPass enrollment and

 7  disenrollment services for Medicaid recipients and is

 8  authorized to adopt rules to implement such services. The

 9  agency may adjust the capitation rate only to cover the costs

10  of a third-party enrollment and disenrollment contract, and

11  for agency supervision and management of the managed care plan

12  enrollment and disenrollment contract.

13         (30)  Any lists of providers made available to Medicaid

14  recipients, MediPass enrollees, or managed care plan enrollees

15  shall be arranged alphabetically showing the provider's name

16  and specialty and, separately, by specialty in alphabetical

17  order.

18         (31)  The agency shall establish an enhanced managed

19  care quality assurance oversight function, to include at least

20  the following components:

21         (a)  At least quarterly analysis and followup,

22  including sanctions as appropriate, of managed care

23  participant utilization of services.

24         (b)  At least quarterly analysis and followup,

25  including sanctions as appropriate, of quality findings of the

26  Medicaid peer review organization and other external quality

27  assurance programs.

28         (c)  At least quarterly analysis and followup,

29  including sanctions as appropriate, of the fiscal viability of

30  managed care plans.

31  

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 1         (d)  At least quarterly analysis and followup,

 2  including sanctions as appropriate, of managed care

 3  participant satisfaction and disenrollment surveys.

 4         (e)  The agency shall conduct regular and ongoing

 5  Medicaid recipient satisfaction surveys.

 6  

 7  The analyses and followup activities conducted by the agency

 8  under its enhanced managed care quality assurance oversight

 9  function shall not duplicate the activities of accreditation

10  reviewers for entities regulated under part III of chapter

11  641, but may include a review of the finding of such

12  reviewers.

13         (32)  Each managed care plan that is under contract

14  with the agency to provide health care services to Medicaid

15  recipients shall annually conduct a background check with the

16  Florida Department of Law Enforcement of all persons with

17  ownership interest of 5 percent or more or executive

18  management responsibility for the managed care plan and shall

19  submit to the agency information concerning any such person

20  who has been found guilty of, regardless of adjudication, or

21  has entered a plea of nolo contendere or guilty to, any of the

22  offenses listed in s. 435.03.

23         (33)  The agency shall, by rule, develop a process

24  whereby a Medicaid managed care plan enrollee who wishes to

25  enter hospice care may be disenrolled from the managed care

26  plan within 24 hours after contacting the agency regarding

27  such request. The agency rule shall include a methodology for

28  the agency to recoup managed care plan payments on a pro rata

29  basis if payment has been made for the enrollment month when

30  disenrollment occurs.

31  

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 1         (34)  The agency and entities that which contract with

 2  the agency to provide health care services to Medicaid

 3  recipients under this section or ss. 409.91211 and s. 409.9122

 4  must comply with the provisions of s. 641.513 in providing

 5  emergency services and care to Medicaid recipients and

 6  MediPass recipients. Where feasible, safe, and cost-effective,

 7  the agency shall encourage hospitals, emergency medical

 8  services providers, and other public and private health care

 9  providers to work together in their local communities to enter

10  into agreements or arrangements to ensure access to

11  alternatives to emergency services and care for those Medicaid

12  recipients who need nonemergent care. The agency shall

13  coordinate with hospitals, emergency medical services

14  providers, private health plans, capitated managed care

15  networks as established in s. 409.91211, and other public and

16  private health care providers to implement the provisions of

17  ss. 395.1041(7), 409.91255(3)(g), 627.6405, and 641.31097 to

18  develop and implement emergency department diversion programs

19  for Medicaid recipients.

20         (35)  All entities providing health care services to

21  Medicaid recipients shall make available, and encourage all

22  pregnant women and mothers with infants to receive, and

23  provide documentation in the medical records to reflect, the

24  following:

25         (a)  Healthy Start prenatal or infant screening.

26         (b)  Healthy Start care coordination, when screening or

27  other factors indicate need.

28         (c)  Healthy Start enhanced services in accordance with

29  the prenatal or infant screening results.

30         (d)  Immunizations in accordance with recommendations

31  of the Advisory Committee on Immunization Practices of the

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 1  United States Public Health Service and the American Academy

 2  of Pediatrics, as appropriate.

 3         (e)  Counseling and services for family planning to all

 4  women and their partners.

 5         (f)  A scheduled postpartum visit for the purpose of

 6  voluntary family planning, to include discussion of all

 7  methods of contraception, as appropriate.

 8         (g)  Referral to the Special Supplemental Nutrition

 9  Program for Women, Infants, and Children (WIC).

10         (36)  Any entity that provides Medicaid prepaid health

11  plan services shall ensure the appropriate coordination of

12  health care services with an assisted living facility in cases

13  where a Medicaid recipient is both a member of the entity's

14  prepaid health plan and a resident of the assisted living

15  facility. If the entity is at risk for Medicaid targeted case

16  management and behavioral health services, the entity shall

17  inform the assisted living facility of the procedures to

18  follow should an emergent condition arise.

19         (37)  The agency may seek and implement federal waivers

20  necessary to provide for cost-effective purchasing of home

21  health services, private duty nursing services,

22  transportation, independent laboratory services, and durable

23  medical equipment and supplies through competitive bidding

24  pursuant to s. 287.057. The agency may request appropriate

25  waivers from the federal Health Care Financing Administration

26  in order to competitively bid such services. The agency may

27  exclude providers not selected through the bidding process

28  from the Medicaid provider network.

29         (38)  The agency shall enter into agreements with

30  not-for-profit organizations based in this state for the

31  purpose of providing vision screening.

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 1         (39)(a)  The agency shall implement a Medicaid

 2  prescribed-drug spending-control program that includes the

 3  following components:

 4         1.  A Medicaid preferred drug list, which shall be a

 5  listing of cost-effective therapeutic options recommended by

 6  the Medicaid Pharmacy and Therapeutics Committee established

 7  under s. 409.91195 and adopted by the agency for each

 8  therapeutic class on the preferred drug list. At the

 9  discretion of the committee, and when feasible, the preferred

10  drug list should include at least two products in a

11  therapeutic class. Medicaid prescribed-drug coverage for

12  brand-name drugs for adult Medicaid recipients is limited to

13  eight the dispensing of four brand-name drugs per month per

14  recipient. Prior authorization is required for all additional

15  prescriptions above the eight-drug limit and must meet the

16  requirements for step therapy and for listing as a preferred

17  drug. Children are exempt from this restriction.

18  Antiretroviral agents are excluded from this limitation. No

19  requirements for prior authorization or other restrictions on

20  medications used to treat mental illnesses such as

21  schizophrenia, severe depression, or bipolar disorder may be

22  imposed on Medicaid recipients. Medications that will be

23  available without restriction for persons with mental

24  illnesses include atypical antipsychotic medications,

25  conventional antipsychotic medications, selective serotonin

26  reuptake inhibitors, and other medications used for the

27  treatment of serious mental illnesses. The agency shall also

28  limit the amount of a prescribed drug dispensed to no more

29  than a 34-day supply unless the drug products' smallest

30  marketed package is greater than a 34-day supply, or the drug

31  is determined by the agency to be a maintenance drug, in which

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 1  case a 180-day maximum supply may be authorized. The agency

 2  may seek any federal waivers necessary to implement these

 3  cost-control programs and to continue participation in the

 4  federal Medicaid rebate program, or alternatively to negotiate

 5  state-only manufacturer rebates. The agency may adopt rules to

 6  administer this subparagraph. The agency shall continue to

 7  provide unlimited generic drugs, contraceptive drugs and

 8  items, and diabetic supplies. Although a drug may be included

 9  on the preferred drug formulary, it would not be exempt from

10  the four-brand limit. The agency may authorize exceptions to

11  the brand-name-drug restriction based upon the treatment needs

12  of the patients, only when such exceptions are based on prior

13  consultation provided by the agency or an agency contractor,

14  but The agency must establish procedures to ensure that:

15         a.  There will be a response to a request for prior

16  consultation by telephone or other telecommunication device

17  within 24 hours after receipt of a request for prior

18  consultation; and

19         b.  A 72-hour supply of the drug prescribed will be

20  provided in an emergency or when the agency does not provide a

21  response within 24 hours as required by sub-subparagraph a.;

22  and

23         c.  Except for the exception for nursing home residents

24  and other institutionalized adults and except for drugs on the

25  restricted formulary for which prior authorization may be

26  sought by an institutional or community pharmacy, prior

27  authorization for an exception to the brand-name-drug

28  restriction is sought by the prescriber and not by the

29  pharmacy. When prior authorization is granted for a patient in

30  an institutional setting beyond the brand-name-drug

31  

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 1  restriction, such approval is authorized for 12 months and

 2  monthly prior authorization is not required for that patient.

 3         2.  Reimbursement to pharmacies for Medicaid prescribed

 4  drugs shall be set at the lesser of: the average wholesale

 5  price (AWP) minus 15.4 percent, the wholesaler acquisition

 6  cost (WAC) plus 5.75 percent, the federal upper limit (FUL),

 7  the state maximum allowable cost (SMAC), or the usual and

 8  customary (UAC) charge billed by the provider.

 9         3.  The agency shall develop and implement a process

10  for managing the drug therapies of Medicaid recipients who are

11  using significant numbers of prescribed drugs each month. The

12  management process may include, but is not limited to,

13  comprehensive, physician-directed medical-record reviews,

14  claims analyses, and case evaluations to determine the medical

15  necessity and appropriateness of a patient's treatment plan

16  and drug therapies. The agency may contract with a private

17  organization to provide drug-program-management services. The

18  Medicaid drug benefit management program shall include

19  initiatives to manage drug therapies for HIV/AIDS patients,

20  patients using 20 or more unique prescriptions in a 180-day

21  period, and the top 1,000 patients in annual spending. The

22  agency shall enroll any Medicaid recipient in the drug benefit

23  management program if he or she meets the specifications of

24  this provision and is not enrolled in a Medicaid health

25  maintenance organization.

26         4.  The agency may limit the size of its pharmacy

27  network based on need, competitive bidding, price

28  negotiations, credentialing, or similar criteria. The agency

29  shall give special consideration to rural areas in determining

30  the size and location of pharmacies included in the Medicaid

31  pharmacy network. A pharmacy credentialing process may include

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 1  criteria such as a pharmacy's full-service status, location,

 2  size, patient educational programs, patient consultation,

 3  disease-management services, and other characteristics. The

 4  agency may impose a moratorium on Medicaid pharmacy enrollment

 5  when it is determined that it has a sufficient number of

 6  Medicaid-participating providers. The agency must allow

 7  dispensing practitioners to participate as a part of the

 8  Medicaid pharmacy network regardless of the practitioner's

 9  proximity to any other entity that is dispensing prescription

10  drugs under the Medicaid program. A dispensing practitioner

11  must meet all credentialing requirements applicable to his or

12  her practice, as determined by the agency.

13         5.  The agency shall develop and implement a program

14  that requires Medicaid practitioners who prescribe drugs to

15  use a counterfeit-proof prescription pad for Medicaid

16  prescriptions. The agency shall require the use of

17  standardized counterfeit-proof prescription pads by

18  Medicaid-participating prescribers or prescribers who write

19  prescriptions for Medicaid recipients. The agency may

20  implement the program in targeted geographic areas or

21  statewide.

22         6.  The agency may enter into arrangements that require

23  manufacturers of generic drugs prescribed to Medicaid

24  recipients to provide rebates of at least 15.1 percent of the

25  average manufacturer price for the manufacturer's generic

26  products. These arrangements shall require that if a

27  generic-drug manufacturer pays federal rebates for

28  Medicaid-reimbursed drugs at a level below 15.1 percent, the

29  manufacturer must provide a supplemental rebate to the state

30  in an amount necessary to achieve a 15.1-percent rebate level.

31  

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 1         7.  The agency may establish a preferred drug list as

 2  described in this subsection formulary in accordance with 42

 3  U.S.C. s. 1396r-8, and, pursuant to the establishment of such

 4  drug list formulary, it may is authorized to negotiate

 5  supplemental rebates from manufacturers which that are in

 6  addition to those required by Title XIX of the Social Security

 7  Act and at no less than 14 percent of the average manufacturer

 8  price as defined in 42 U.S.C. s. 1936 on the last day of a

 9  quarter unless the federal or supplemental rebate, or both,

10  equals or exceeds 29 percent. There is no upper limit on the

11  supplemental rebates the agency may negotiate. The agency may

12  determine that specific products, brand-name or generic, are

13  competitive at lower rebate percentages. Agreement to pay the

14  minimum supplemental rebate percentage will guarantee a

15  manufacturer that the Medicaid Pharmaceutical and Therapeutics

16  Committee will consider a product for inclusion on the

17  preferred drug list formulary. However, a pharmaceutical

18  manufacturer is not guaranteed placement on the preferred drug

19  list formulary by simply paying the minimum supplemental

20  rebate. Agency decisions will be made on the clinical efficacy

21  of a drug and recommendations of the Medicaid Pharmaceutical

22  and Therapeutics Committee, as well as the price of competing

23  products minus federal and state rebates. The agency is

24  authorized to contract with an outside agency or contractor to

25  conduct negotiations for supplemental rebates. For the

26  purposes of this section, the term "supplemental rebates"

27  means cash rebates. Effective July 1, 2004, value-added

28  programs as a substitution for supplemental rebates are

29  prohibited. The agency is authorized to seek any federal

30  waivers to implement this initiative.

31  

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 1         8.  The agency shall establish an advisory committee

 2  for the purposes of studying the feasibility of using a

 3  restricted drug formulary for nursing home residents and other

 4  institutionalized adults. The committee shall be comprised of

 5  seven members appointed by the Secretary of Health Care

 6  Administration. The committee members shall include two

 7  physicians licensed under chapter 458 or chapter 459; three

 8  pharmacists licensed under chapter 465 and appointed from a

 9  list of recommendations provided by the Florida Long-Term Care

10  Pharmacy Alliance; and two pharmacists licensed under chapter

11  465.

12         8.9.  The Agency for Health Care Administration shall

13  expand home delivery of pharmacy products. To assist Medicaid

14  patients in securing their prescriptions and reduce program

15  costs, the agency shall expand its current mail-order-pharmacy

16  diabetes-supply program to include all generic and brand-name

17  drugs used by Medicaid patients with diabetes. Medicaid

18  recipients in the current program may obtain nondiabetes drugs

19  on a voluntary basis. This initiative is limited to the

20  geographic area covered by the current contract. The agency

21  may seek and implement any federal waivers necessary to

22  implement this subparagraph.

23         9.10.  The agency shall limit to one dose per month any

24  drug prescribed to treat erectile dysfunction.

25         10.11.a.  The agency shall implement a Medicaid

26  behavioral drug management system. The agency may contract

27  with a vendor that has experience in operating behavioral drug

28  management systems to implement this program. The agency is

29  authorized to seek federal waivers to implement this program.

30         b.  The agency, in conjunction with the Department of

31  Children and Family Services, may implement the Medicaid

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 1  behavioral drug management system that is designed to improve

 2  the quality of care and behavioral health prescribing

 3  practices based on best practice guidelines, improve patient

 4  adherence to medication plans, reduce clinical risk, and lower

 5  prescribed drug costs and the rate of inappropriate spending

 6  on Medicaid behavioral drugs. The program shall include the

 7  following elements:

 8         (I)  Provide for the development and adoption of best

 9  practice guidelines for behavioral health-related drugs such

10  as antipsychotics, antidepressants, and medications for

11  treating bipolar disorders and other behavioral conditions;

12  translate them into practice; review behavioral health

13  prescribers and compare their prescribing patterns to a number

14  of indicators that are based on national standards; and

15  determine deviations from best practice guidelines.

16         (II)  Implement processes for providing feedback to and

17  educating prescribers using best practice educational

18  materials and peer-to-peer consultation.

19         (III)  Assess Medicaid beneficiaries who are outliers

20  in their use of behavioral health drugs with regard to the

21  numbers and types of drugs taken, drug dosages, combination

22  drug therapies, and other indicators of improper use of

23  behavioral health drugs.

24         (IV)  Alert prescribers to patients who fail to refill

25  prescriptions in a timely fashion, are prescribed multiple

26  same-class behavioral health drugs, and may have other

27  potential medication problems.

28         (V)  Track spending trends for behavioral health drugs

29  and deviation from best practice guidelines.

30  

31  

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 1         (VI)  Use educational and technological approaches to

 2  promote best practices, educate consumers, and train

 3  prescribers in the use of practice guidelines.

 4         (VII)  Disseminate electronic and published materials.

 5         (VIII)  Hold statewide and regional conferences.

 6         (IX)  Implement a disease management program with a

 7  model quality-based medication component for severely mentally

 8  ill individuals and emotionally disturbed children who are

 9  high users of care.

10         c.  If the agency is unable to negotiate a contract

11  with one or more manufacturers to finance and guarantee

12  savings associated with a behavioral drug management program

13  by September 1, 2004, the four-brand drug limit and preferred

14  drug list prior-authorization requirements shall apply to

15  mental health-related drugs, notwithstanding any provision in

16  subparagraph 1. The agency is authorized to seek federal

17  waivers to implement this policy.

18         11.a.  The agency shall implement a Medicaid

19  prescription-drug-management system. The agency may contract

20  with a vendor that has experience in operating

21  prescription-drug-management systems in order to implement

22  this system. Any management system that is implemented in

23  accordance with this subparagraph must rely on cooperation

24  between physicians and pharmacists to determine appropriate

25  practice patterns and clinical guidelines to improve the

26  prescribing, dispensing, and use of drugs in the Medicaid

27  program. The agency may seek federal waivers to implement this

28  program.

29         b.  The drug-management system must be designed to

30  improve the quality of care and prescribing practices based on

31  best-practice guidelines, improve patient adherence to

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 1  medication plans, reduce clinical risk, and lower prescribed

 2  drug costs and the rate of inappropriate spending on Medicaid

 3  prescription drugs. The program must:

 4         (I)  Provide for the development and adoption of

 5  best-practice guidelines for the prescribing and use of drugs

 6  in the Medicaid program, including translating best-practice

 7  guidelines into practice; reviewing prescriber patterns and

 8  comparing them to indicators that are based on national

 9  standards and practice patterns of clinical peers in their

10  community, statewide, and nationally; and determine deviations

11  from best-practice guidelines.

12         (II)  Implement processes for providing feedback to and

13  educating prescribers using best-practice educational

14  materials and peer-to-peer consultation.

15         (III)  Assess Medicaid recipients who are outliers in

16  their use of a single or multiple prescription drugs with

17  regard to the numbers and types of drugs taken, drug dosages,

18  combination drug therapies, and other indicators of improper

19  use of prescription drugs.

20         (IV)  Alert prescribers to patients who fail to refill

21  prescriptions in a timely fashion, are prescribed multiple

22  drugs that may be redundant or contraindicated, or may have

23  other potential medication problems.

24         (V)  Track spending trends for prescription drugs and

25  deviation from best practice guidelines.

26         (VI)  Use educational and technological approaches to

27  promote best practices, educate consumers, and train

28  prescribers in the use of practice guidelines.

29         (VII)  Disseminate electronic and published materials.

30         (VIII)  Hold statewide and regional conferences.

31  

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 1         (IX)  Implement disease-management programs in

 2  cooperation with physicians and pharmacists, along with a

 3  model quality-based medication component for individuals

 4  having chronic medical conditions.

 5         12.  The agency is authorized to contract for drug

 6  rebate administration, including, but not limited to,

 7  calculating rebate amounts, invoicing manufacturers,

 8  negotiating disputes with manufacturers, and maintaining a

 9  database of rebate collections.

10         13.  The agency may specify the preferred daily dosing

11  form or strength for the purpose of promoting best practices

12  with regard to the prescribing of certain drugs as specified

13  in the General Appropriations Act and ensuring cost-effective

14  prescribing practices.

15         14.  The agency may require prior authorization for the

16  off-label use of Medicaid-covered prescribed drugs as

17  specified in the General Appropriations Act. The agency may,

18  but is not required to, preauthorize the use of a product for

19  an indication not in the approved labeling. Prior

20  authorization may require the prescribing professional to

21  provide information about the rationale and supporting medical

22  evidence for the off-label use of a drug.

23         15.  The agency, in conjunction with the Pharmaceutical

24  and Therapeutics Committee, may require age-related prior

25  authorizations for certain prescribed drugs. The agency may

26  preauthorize the use of a drug for a recipient who may not

27  meet the age requirement or may exceed the length of therapy

28  for use of this product as recommended by the manufacturer and

29  approved by the United States Food and Drug Administration.

30  Prior authorization may require the prescribing professional

31  

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 1  to provide information about the rationale and supporting

 2  medical evidence for the use of a drug.

 3         16.  The agency shall implement a step-therapy

 4  prior-authorization-approval process for medications excluded

 5  from the preferred drug list. Medications listed on the

 6  preferred drug list must be used within the previous 12 months

 7  prior to the alternative medications that are not listed. The

 8  step-therapy prior authorization may require the prescriber to

 9  use the medications of a similar drug class or for a similar

10  medical indication unless contraindicated in the labeling by

11  the Food and Drug Administration. The trial period between the

12  specified steps may vary according to the medical indication.

13  The step-therapy-approval process shall be developed in

14  accordance with the committee as stated in s. 409.91195(7) and

15  (8).

16         17.15.  The agency shall implement a return and reuse

17  program for drugs dispensed by pharmacies to institutional

18  recipients, which includes payment of a $5 restocking fee for

19  the implementation and operation of the program. The return

20  and reuse program shall be implemented electronically and in a

21  manner that promotes efficiency. The program must permit a

22  pharmacy to exclude drugs from the program if it is not

23  practical or cost-effective for the drug to be included and

24  must provide for the return to inventory of drugs that cannot

25  be credited or returned in a cost-effective manner. The agency

26  shall determine if the program has reduced the amount of

27  Medicaid prescription drugs which are destroyed on an annual

28  basis and if there are additional ways to ensure more

29  prescription drugs are not destroyed which could safely be

30  reused. The agency's conclusion and recommendations shall be

31  reported to the Legislature by December 1, 2005.

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 1         (b)  The agency shall implement this subsection to the

 2  extent that funds are appropriated to administer the Medicaid

 3  prescribed-drug spending-control program. The agency may

 4  contract all or any part of this program to private

 5  organizations.

 6         (c)  The agency shall submit quarterly reports to the

 7  Governor, the President of the Senate, and the Speaker of the

 8  House of Representatives which must include, but need not be

 9  limited to, the progress made in implementing this subsection

10  and its effect on Medicaid prescribed-drug expenditures.

11         (40)  Notwithstanding the provisions of chapter 287,

12  the agency may, at its discretion, renew a contract or

13  contracts for fiscal intermediary services one or more times

14  for such periods as the agency may decide; however, all such

15  renewals may not combine to exceed a total period longer than

16  the term of the original contract.

17         (41)  The agency shall provide for the development of a

18  demonstration project by establishment in Miami-Dade County of

19  a long-term-care facility licensed pursuant to chapter 395 to

20  improve access to health care for a predominantly minority,

21  medically underserved, and medically complex population and to

22  evaluate alternatives to nursing home care and general acute

23  care for such population. Such project is to be located in a

24  health care condominium and colocated with licensed facilities

25  providing a continuum of care. The establishment of this

26  project is not subject to the provisions of s. 408.036 or s.

27  408.039. The agency shall report its findings to the Governor,

28  the President of the Senate, and the Speaker of the House of

29  Representatives by January 1, 2003.

30         (42)  The agency shall develop and implement a

31  utilization management program for Medicaid-eligible

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 1  recipients for the management of occupational, physical,

 2  respiratory, and speech therapies. The agency shall establish

 3  a utilization program that may require prior authorization in

 4  order to ensure medically necessary and cost-effective

 5  treatments. The program shall be operated in accordance with a

 6  federally approved waiver program or state plan amendment. The

 7  agency may seek a federal waiver or state plan amendment to

 8  implement this program. The agency may also competitively

 9  procure these services from an outside vendor on a regional or

10  statewide basis.

11         (43)  The agency may contract on a prepaid or fixed-sum

12  basis with appropriately licensed prepaid dental health plans

13  to provide dental services.

14         (44)  The Agency for Health Care Administration shall

15  ensure that any Medicaid managed care plan as defined in s.

16  409.9122(2)(h), whether paid on a capitated basis or a shared

17  savings basis, is cost-effective. For purposes of this

18  subsection, the term "cost-effective" means that a network's

19  per-member, per-month costs to the state, including, but not

20  limited to, fee-for-service costs, administrative costs, and

21  case-management fees, must be no greater than the state's

22  costs associated with contracts for Medicaid services

23  established under subsection (3), which shall be actuarially

24  adjusted for case mix, model, and service area. The agency

25  shall conduct actuarially sound audits adjusted for case mix

26  and model in order to ensure such cost-effectiveness and shall

27  publish the audit results on its Internet website and submit

28  the audit results annually to the Governor, the President of

29  the Senate, and the Speaker of the House of Representatives no

30  later than December 31 of each year. Contracts established

31  

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 1  pursuant to this subsection which are not cost-effective may

 2  not be renewed.

 3         (45)  Subject to the availability of funds, the agency

 4  shall mandate a recipient's participation in a provider

 5  lock-in program, when appropriate, if a recipient is found by

 6  the agency to have used Medicaid goods or services at a

 7  frequency or amount not medically necessary, limiting the

 8  receipt of goods or services to medically necessary providers

 9  after the 21-day appeal process has ended, for a period of not

10  less than 1 year. The lock-in programs shall include, but are

11  not limited to, pharmacies, medical doctors, and infusion

12  clinics. The limitation does not apply to emergency services

13  and care provided to the recipient in a hospital emergency

14  department. The agency shall seek any federal waivers

15  necessary to implement this subsection. The agency shall adopt

16  any rules necessary to comply with or administer this

17  subsection.

18         (46)  The agency shall seek a federal waiver for

19  permission to terminate the eligibility of a Medicaid

20  recipient who has been found to have committed fraud, through

21  judicial or administrative determination, two times in a

22  period of 5 years.

23         (47)  The agency shall conduct a study of available

24  electronic systems for the purpose of verifying the identity

25  and eligibility of a Medicaid recipient. The agency shall

26  recommend to the Legislature a plan to implement an electronic

27  verification system for Medicaid recipients by January 31,

28  2005.

29         (48)  A provider is not entitled to enrollment in the

30  Medicaid provider network. The agency may implement a Medicaid

31  fee-for-service provider network controls, including, but not

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 1  limited to, competitive procurement and provider

 2  credentialing. If a credentialing process is used, the agency

 3  may limit its provider network based upon the following

 4  considerations: beneficiary access to care, provider

 5  availability, provider quality standards and quality assurance

 6  processes, cultural competency, demographic characteristics of

 7  beneficiaries, practice standards, service wait times,

 8  provider turnover, provider licensure and accreditation

 9  history, program integrity history, peer review, Medicaid

10  policy and billing compliance records, clinical and medical

11  record audit findings, and such other areas that are

12  considered necessary by the agency to ensure the integrity of

13  the program.

14         (49)  The agency shall contract with established

15  minority physician networks that provide services to

16  historically underserved minority patients. The networks must

17  provide cost-effective Medicaid services, comply with the

18  requirements to be a MediPass provider, and provide their

19  primary care physicians with access to data and other

20  management tools necessary to assist them in ensuring the

21  appropriate use of services, including inpatient hospital

22  services and pharmaceuticals.

23         (a)  The agency shall provide for the development and

24  expansion of minority physician networks in each service area

25  to provide services to Medicaid recipients who are eligible to

26  participate under federal law and rules.

27         (b)  The agency shall reimburse each minority physician

28  network as a fee-for-service provider, including the case

29  management fee for primary care, or as a capitated rate

30  provider for Medicaid services. Any savings shall be shared

31  with the minority physician networks pursuant to the contract.

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 1         (c)  For purposes of this subsection, the term

 2  "cost-effective" means that a network's per-member, per-month

 3  costs to the state, including, but not limited to,

 4  fee-for-service costs, administrative costs, and

 5  case-management fees, must be no greater than the state's

 6  costs associated with contracts for Medicaid services

 7  established under subsection (3), which shall be actuarially

 8  adjusted for case mix, model, and service area. The agency

 9  shall conduct actuarially sound audits adjusted for case mix

10  and model in order to ensure such cost-effectiveness and shall

11  publish the audit results on its Internet website and submit

12  the audit results annually to the Governor, the President of

13  the Senate, and the Speaker of the House of Representatives no

14  later than December 31. Contracts established pursuant to this

15  subsection which are not cost-effective may not be renewed.

16         (d)  The agency may apply for any federal waivers

17  needed to implement this subsection.

18         (50)  The agency shall implement a program of

19  all-inclusive care for children. The program of all-inclusive

20  care for children shall be established in order to provide

21  in-home, hospice-like support services to children diagnosed

22  as having a life-threatening illness and who are enrolled in

23  the Children's Medical Services network and to reduce

24  hospitalizations as appropriate. The agency, in consultation

25  with the Department of Health, may implement the program of

26  all-inclusive care for children after obtaining approval from

27  the Centers for Medicare and Medicaid Services.

28         (51)  To the extent permitted by federal law and as

29  allowed under s. 409.906, the agency shall provide

30  reimbursement for emergency mental health care services for

31  Medicaid recipients in crisis-stabilization facilities

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 1  licensed under s. 394.875 as long as those services are less

 2  expensive than the same services provided in a hospital

 3  setting.

 4         Section 2.  Section 409.91211, Florida Statutes, is

 5  created to read:

 6         409.91211  Medicaid managed care pilot program.--

 7         (1)(a)  The agency shall develop a pilot program to

 8  deliver health care services specified in ss. 409.905 and

 9  409.906 through capitated managed care networks under the

10  Medicaid program to persons in Medicaid fee-for-service or the

11  MediPass program, contingent upon federal approval to preserve

12  the upper-payment-limit funding mechanism for hospitals,

13  including a guarantee of a reasonable growth factor, a

14  methodology to allow the use of a portion of these funds to

15  serve as risk pool for pilot sites, provisions to preserve the

16  state's ability to use intergovernmental transfers, and

17  provisions to protect the disproportionate share program

18  authorized pursuant to this chapter.

19         (b)  The agency may include, as part of the waiver

20  request, an alternative methodology for making additional

21  Medicaid payments to hospitals based on the level of Medicaid

22  or care provided to the uninsured. Any alternative

23  methodology, however, must provide the same level of federal

24  funding as the current upper payment limit and include a

25  reasonable growth factor. Absent federal approval of a

26  reasonable growth factor, the Agency for Health Care

27  Administration shall provide the Legislature, pursuant to the

28  implementation plan provided for in section 3 of this act, the

29  following:

30         1.  Based on the historical growth and current federal

31  rules governing the upper-payment-limit funding, an estimate

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 1  of the projected growth of funding over the next 10 years and

 2  an estimate of the loss of federal funding which can be

 3  attributed to the implementation of any Medicaid waiver.

 4         2.  An analysis showing the amount of additional

 5  upper-payment-limit-funds that this state would have received

 6  if it had been granted the exceptions to the

 7  upper-payment-limit cap provided to other states in 42 C.F.R.

 8  s. 447.272 from the 2002 through 2009 state fiscal years.

 9         3.  An analysis with accompanying rationale supporting

10  the implementation of any waiver that would result in

11  hospitals in this state which provide safety net services

12  receiving less federal funds relative to the federal support

13  given to similar hospitals in other states.

14         (2)  The Legislature intends for the capitated managed

15  care pilot program to:

16         (a)  Provide recipients in Medicaid fee-for-service or

17  the MediPass program a comprehensive and coordinated capitated

18  managed care system for all health care services specified in

19  ss. 409.905 and 409.906.

20         (b)  Stabilize Medicaid expenditures under the pilot

21  program compared to Medicaid expenditures in the pilot area

22  for the 3 years before implementation of the pilot program,

23  while ensuring:

24         1.  Consumer education and choice.

25         2.  Access to medically necessary services.

26         3.  Coordination of preventative, acute, and long-term

27  care.

28         4.  Reductions in unnecessary service utilization.

29         (c)  Provide an opportunity to evaluate the feasibility

30  of statewide implementation of capitated managed care networks

31  

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 1  as a replacement for the current Medicaid fee-for-service and

 2  MediPass systems.

 3         (3)  The agency shall have the following powers,

 4  duties, and responsibilities with respect to the development

 5  of a pilot program to deliver all health care services

 6  specified in ss. 409.905 and 409.906 in the form of capitated

 7  managed care networks under the Medicaid program to persons in

 8  Medicaid fee-for-service or the MediPass program:

 9         (a)  To define and recommend the medical and financial

10  eligibility standards for capitated managed care networks in

11  the pilot program. This paragraph does not relieve an entity

12  that qualifies as a capitated managed care network under this

13  section from any other licensure or regulatory requirements

14  contained in state or federal law which would otherwise apply

15  to the entity.

16         (b)  To include two geographic areas in the pilot

17  program and recommend Medicaid-eligibility categories, from

18  those specified in ss. 409.903 and 409.904, which shall be

19  included in the pilot program. One pilot program must include

20  only Broward County. A second pilot program must initially

21  include Duval County and may be expanded to Baker, Clay, and

22  Nassau Counties after the Duval County program has been

23  operating for at least 1 year. A Medicaid recipient may not be

24  enrolled in or assigned to a capitated managed care plan

25  unless the capitated managed care plan has complied with the

26  standards and credentialing requirements specified in

27  paragraph (e).

28         (c)  To determine and recommend how to design the

29  managed care delivery system in order to take maximum

30  advantage of all available state and federal funds, including

31  those obtained through intergovernmental transfers, the

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 1  upper-payment-level funding systems, and the disproportionate

 2  share program.

 3         (d)  To determine and recommend actuarially sound,

 4  risk-adjusted capitation rates for Medicaid recipients in the

 5  pilot program which can be separated to cover comprehensive

 6  care, enhanced services, and catastrophic care.

 7         (e)  To determine and recommend policies and guidelines

 8  for phasing in financial risk for approved provider service

 9  networks over a 3-year period. These shall include an option

10  to pay fee-for-service rates that may include a

11  savings-settlement option for at least 2 years. This model may

12  be converted to a risk adjusted capitated rate in the third

13  year of operation.

14         (f)  To determine and recommend provisions related to

15  stop-loss requirements and the transfer of excess cost to

16  catastrophic coverage that accommodates the risks associated

17  with the development of the pilot projects.

18         (g)  To determine and recommend a process to be used by

19  the Social Services Estimating Conference to determine and

20  validate the rate of growth of the per-member costs of

21  providing Medicaid services under the managed care initiative.

22         (h)  To determine and recommend descriptions of the

23  eligibility assignment processes that will be used to

24  facilitate client choice while ensuring pilot projects of

25  adequate enrollment levels. These processes shall ensure that

26  pilot sites have sufficient levels of enrollment to conduct a

27  valid test of the managed care pilot project model within a

28  2-year timeframe.

29         (i)  To determine and recommend program standards and

30  credentialing requirements for capitated managed care networks

31  to participate in the pilot program, including those related

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 1  to fiscal solvency, quality of care, and adequacy of access to

 2  health care providers. This paragraph does not relieve an

 3  entity that qualifies as a capitated managed care network

 4  under this section from any other licensure or regulatory

 5  requirements contained in state or federal law that would

 6  otherwise apply to the entity. These standards must address,

 7  but are not limited to:

 8         1.  Compliance with the accreditation requirements as

 9  provided in s. 641.512.

10         2.  Compliance with early and periodic screening,

11  diagnosis, and treatment screening requirements under federal

12  law.

13         3.  The percentage of voluntary disenrollments.

14         4.  Immunization rates.

15         5.  Standards of the National Committee for Quality

16  Assurance and other approved accrediting bodies.

17         6.  Recommendations of other authoritative bodies.

18         7.  Specific requirements of the Medicaid program, or

19  standards designed to specifically meet the unique needs of

20  Medicaid recipients.

21         8.  Compliance with the health quality improvement

22  system as established by the agency, which incorporates

23  standards and guidelines developed by the Centers for Medicare

24  and Medicaid Services as part of the quality assurance reform

25  initiative.

26         (j)  To develop and recommend a mechanism for providing

27  information to Medicaid recipients for the purpose of

28  selecting a capitated managed care plan. Examples of such

29  mechanisms may include, but are not limited to, interactive

30  information systems, mailings, mass marketing materials,

31  

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 1  public information and enrollment fairs, contracted one-on-one

 2  counseling services, and peer counseling services.

 3         (k)  To develop and recommend a system that prohibits

 4  capitated managed care plans, their representatives, and

 5  providers employed by or contracted with the capitated managed

 6  care plans from recruiting persons eligible for or enrolled in

 7  Medicaid, from providing inducements to Medicaid recipients to

 8  select a particular capitated managed care plan, and from

 9  prejudicing Medicaid recipients against other capitated

10  managed care plans.

11         (l)  To develop and recommend a system to monitor the

12  provision of health care services in the pilot program,

13  including utilization and quality of health care services for

14  the purpose of ensuring access to medically necessary

15  services. This system shall include an encounter

16  data-information system that collects and reports utilization

17  information. The system shall include a method for verifying

18  data integrity within the database and within the provider's

19  medical records.

20         (m)  To recommend a grievance-resolution process for

21  Medicaid recipients enrolled in a capitated managed care

22  network under the pilot program modeled after the subscriber

23  assistance panel, as created in s. 408.7056. This process

24  shall include a mechanism for an expedited review of no

25  greater than 24 hours after notification of a grievance if the

26  life of a Medicaid recipient is in imminent and emergent

27  jeopardy.

28         (n)  To recommend a grievance-resolution process for

29  health care providers employed by or contracted with a

30  capitated managed care network under the pilot program in

31  

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 1  order to settle disputes among the provider and the managed

 2  care network or the provider and the agency.

 3         (o)  To develop and recommend criteria to designate

 4  health care providers as eligible to participate in the pilot

 5  program. The agency and capitated managed care networks must

 6  follow national guidelines for selecting health care

 7  providers, whenever available. These criteria must include at

 8  a minimum those criteria specified in s. 409.907.

 9         (p)  To develop and recommend health care provider

10  agreements for participation in the pilot program.

11         (q)  To require that all health care providers under

12  contract with the pilot program be duly licensed in the state,

13  if such licensure is available, and meet other criteria as may

14  be established by the agency. These criteria shall include at

15  a minimum those criteria specified in s. 409.907.

16         (r)  To develop and recommend agreements with other

17  state or local governmental programs or institutions for the

18  coordination of health care to eligible individuals receiving

19  services from such programs or institutions.

20         (s)  To develop and recommend a system to oversee the

21  activities of pilot program participants, health care

22  providers, capitated managed care networks, and their

23  representatives in order to prevent fraud or abuse,

24  overutilization or duplicative utilization, underutilization

25  or inappropriate denial of services, and neglect of

26  participants and to recover overpayments as appropriate. For

27  the purposes of this paragraph, the terms "abuse" and "fraud"

28  have the meanings as provided in s. 409.913. The agency must

29  refer incidents of suspected fraud, abuse, overutilization and

30  duplicative utilization, and underutilization or inappropriate

31  denial of services to the appropriate regulatory agency.

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 1         (t)  To develop and provide actuarial and benefit

 2  design analyses that indicate the effect on capitation rates

 3  and benefits offered in the pilot program over a prospective

 4  5-year period based on the following assumptions:

 5         1.  Growth in capitation rates which is limited to the

 6  estimated growth rate in general revenue.

 7         2.  Growth in capitation rates which is limited to the

 8  average growth rate over the last 3 years in per-recipient

 9  Medicaid expenditures.

10         3.  Growth in capitation rates which is limited to the

11  growth rate of aggregate Medicaid expenditures between the

12  2003-2004 fiscal year and the 2004-2005 fiscal year.

13         (u)  To develop a mechanism to require capitated

14  managed care plans to reimburse qualified emergency service

15  providers, including, but not limited to, ambulance services,

16  in accordance with ss. 409.908 and 409.9128.

17         (v)  To develop a system whereby school districts

18  participating in the certified school match program pursuant

19  to ss. 409.908(21) and 1011.70 shall be reimbursed by

20  Medicaid, subject to the limitations of s. 1011.70(1), for a

21  Medicaid-eligible child participating in the services as

22  authorized in s. 1011.70, as provided for in s. 409.9071,

23  regardless of whether the child is enrolled in a capitated

24  managed care network. Capitated managed care networks must

25  make a good-faith effort to execute agreements with school

26  districts regarding the coordinated provision of services

27  authorized under s. 1011.70. County health departments

28  delivering school-based services pursuant to ss. 381.0056 and

29  381.0057 must be reimbursed by Medicaid for the federal share

30  for a Medicaid-eligible child who receives Medicaid-covered

31  services in a school setting, regardless of whether the child

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 1  is enrolled in a capitated managed care network. Capitated

 2  managed care networks must make a good-faith effort to execute

 3  agreements with county health departments regarding the

 4  coordinated provision of services to a Medicaid-eligible

 5  child. To ensure continuity of care for Medicaid patients, the

 6  agency, the Department of Health, and the Department of

 7  Education shall develop procedures for ensuring that a

 8  student's capitated managed care network provider receives

 9  information relating to services provided in accordance with

10  ss. 381.0056, 381.0057, 409.9071, and 1011.70.

11         (w)  To develop and recommend a mechanism whereby

12  Medicaid recipients who are already enrolled in a managed care

13  plan or the MediPass program in the pilot areas shall be

14  offered the opportunity to change to capitated managed care

15  plans on a staggered basis, as defined by the agency. All

16  Medicaid recipients shall have 30 days in which to make a

17  choice of capitated managed care plans. Those Medicaid

18  recipients who do not make a choice shall be assigned to a

19  capitated managed care plan in accordance with paragraph

20  (4)(a). To facilitate continuity of care for a Medicaid

21  recipient who is also a recipient of Supplemental Security

22  Income (SSI), prior to assigning the SSI recipient to a

23  capitated managed care plan, the agency shall determine

24  whether the SSI recipient has an ongoing relationship with a

25  provider or capitated managed care plan, and if so, the agency

26  shall assign the SSI recipient to that provider or capitated

27  managed care plan where feasible. Those SSI recipients who do

28  not have such a provider relationship shall be assigned to a

29  capitated managed care plan provider in accordance with

30  paragraph (4)(a).

31  

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 1         (x)  To develop and recommend a service delivery

 2  alternative for children having chronic medical conditions

 3  which establishes a medical home project to provide primary

 4  care services to this population. The project shall provide

 5  community-based primary care services that are integrated with

 6  other subspecialties to meet the medical, developmental, and

 7  emotional needs for children and their families. This project

 8  shall include an evaluation component to determine impacts on

 9  hospitalizations, length of stays, emergency room visits,

10  costs, and access to care, including specialty care and

11  patient, and family satisfaction.

12         (4)(a)  A Medicaid recipient in the pilot area who is

13  not currently enrolled in a capitated managed care plan upon

14  implementation is not eligible for services as specified in

15  ss. 409.905 and 409.906, for the amount of time that the

16  recipient does not enroll in a capitated managed care network.

17  If a Medicaid recipient has not enrolled in a capitated

18  managed care plan within 30 days after eligibility, the agency

19  shall assign the Medicaid recipient to a capitated managed

20  care plan based on the assessed needs of the recipient as

21  determined by the agency. When making assignments, the agency

22  shall take into account the following criteria:

23         1.  A capitated managed care network has sufficient

24  network capacity to meet the need of members.

25         2.  The capitated managed care network has previously

26  enrolled the recipient as a member, or one of the capitated

27  managed care network's primary care providers has previously

28  provided health care to the recipient.

29         3.  The agency has knowledge that the member has

30  previously expressed a preference for a particular capitated

31  

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 1  managed care network as indicated by Medicaid fee-for-service

 2  claims data, but has failed to make a choice.

 3         4.  The capitated managed care network's primary care

 4  providers are geographically accessible to the recipient's

 5  residence.

 6         (b)  When more than one capitated managed care network

 7  provider meets the criteria specified in paragraph (3)(j), the

 8  agency shall make recipient assignments consecutively by

 9  family unit.

10         (c)  The agency may not engage in practices that are

11  designed to favor one capitated managed care plan over another

12  or that are designed to influence Medicaid recipients to

13  enroll in a particular capitated managed care network in order

14  to strengthen its particular fiscal viability.

15         (d)  After a recipient has made a selection or has been

16  enrolled in a capitated managed care network, the recipient

17  shall have 90 days in which to voluntarily disenroll and

18  select another capitated managed care network. After 90 days,

19  no further changes may be made except for cause. Cause shall

20  include, but not be limited to, poor quality of care, lack of

21  access to necessary specialty services, an unreasonable delay

22  or denial of service, inordinate or inappropriate changes of

23  primary care providers, service access impairments due to

24  significant changes in the geographic location of services, or

25  fraudulent enrollment. The agency may require a recipient to

26  use the capitated managed care network's grievance process as

27  specified in paragraph (3)(h) prior to the agency's

28  determination of cause, except in cases in which immediate

29  risk of permanent damage to the recipient's health is alleged.

30  The grievance process, when used, must be completed in time to

31  permit the recipient to disenroll no later than the first day

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 1  of the second month after the month the disenrollment request

 2  was made. If the capitated managed care network, as a result

 3  of the grievance process, approves an enrollee's request to

 4  disenroll, the agency is not required to make a determination

 5  in the case. The agency must make a determination and take

 6  final action on a recipient's request so that disenrollment

 7  occurs no later than the first day of the second month after

 8  the month the request was made. If the agency fails to act

 9  within the specified timeframe, the recipient's request to

10  disenroll is deemed to be approved as of the date agency

11  action was required. Recipients who disagree with the agency's

12  finding that cause does not exist for disenrollment shall be

13  advised of their right to pursue a Medicaid fair hearing to

14  dispute the agency's finding.

15         (e)  The agency shall apply for federal waivers from

16  the Centers for Medicare and Medicaid Services to lock

17  eligible Medicaid recipients into a capitated managed care

18  network for 12 months after an open enrollment period. After

19  12 months of enrollment, a recipient may select another

20  capitated managed care network. However, nothing shall prevent

21  a Medicaid recipient from changing primary care providers

22  within the capitated managed care network during the 12-month

23  period.

24         (f)  The agency shall develop and submit for approval

25  applications for waivers of applicable federal laws and

26  regulations as necessary to implement the capitated managed

27  care pilot program as defined in this section. The agency

28  shall post all waiver applications under this section on its

29  Internet website 30 days before submitting the applications to

30  the United States Centers for Medicare and Medicaid Services.

31  Notwithstanding s. 409.912(11), all waiver applications shall

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 1  be submitted to the Senate and House of Representatives Select

 2  Committees on Medicaid Reform to be approved for submission.

 3  All waivers submitted to and approved by the United States

 4  Centers for Medicare and Medicaid Services under this section

 5  must be submitted to the Senate and House of Representatives

 6  Select Committees on Medicaid Reform in order to obtain

 7  authority for implementation as required by s. 409.912(11)

 8  before program implementation. The Select Committees on

 9  Medicaid Reform shall recommend whether to approve the

10  implementation of the waivers to the Legislature or to the

11  Legislative Budget Commission if the Legislature is not in

12  regular or special session.

13         (5)  Upon review and approval of the applications for

14  waivers of applicable federal laws and regulations to

15  implement the pilot project by the Legislature, the Agency for

16  Health Care Administration may initiate adoption of rules

17  pursuant to ss. 120.536(1) and 120.54 to implement and

18  administer the managed care pilot program as provided in this

19  section.

20         Section 3.  The Agency for Health Care Administration

21  shall submit an implementation plan for the managed care pilot

22  program created under section 409.91211, Florida Statutes, to

23  the Senate and House of Representatives Select Committees on

24  Medicaid Reform upon approval of all waivers of federal laws

25  and regulations by the United States Centers for Medicare and

26  Medicaid Services which are necessary to implement the managed

27  care pilot program. Based on the review of the implementation

28  plan, the Senate and House Select Committees on Medicaid

29  Reform shall determine whether to recommend implementation of

30  the pilot program for approval by the Legislature or by the

31  Legislative Budget Commission if the Legislature is not in

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 1  regular or special session. The implementation plan must

 2  include all information specified in section 409.91211(3) and

 3  (4), Florida Statutes. The plan must contain a detailed

 4  timeline for implementation. The plan must contain budgetary

 5  projections of the effect of the pilot program on the total

 6  Medicaid budget for the 2006-2007 through 2009-2010 fiscal

 7  years.

 8         Section 4.  The Office of Program Policy Analysis and

 9  Government Accountability, in consultation with the Auditor

10  General, shall comprehensively evaluate the two managed care

11  pilot programs created under section 409.91211, Florida

12  Statutes. The evaluation shall begin with the implementation

13  of the managed care model in the pilot areas and continue for

14  24 months after the two pilot programs have enrolled Medicaid

15  recipients and started providing health care services. The

16  evaluation must include assessments of cost savings; consumer

17  education, choice, and access to services; coordination of

18  care; and quality of care by each eligibility category and

19  managed care plan in each pilot site. The evaluation must

20  describe administrative or legal barriers to the

21  implementation and operation of each pilot program and include

22  recommendations regarding statewide expansion of the managed

23  care pilot programs. The office shall submit an evaluation

24  report to the Governor, the President of the Senate, and the

25  Speaker of the House of Representatives no later than June 30,

26  2008. The managed care pilot program may not be expanded to

27  any additional counties that are not identified in this

28  section without the authorization of the Legislature.

29         Section 5.  Paragraphs (a) and (j) of subsection (2) of

30  section 409.9122, Florida Statutes, are amended to read:

31  

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 1         409.9122  Mandatory Medicaid managed care enrollment;

 2  programs and procedures.--

 3         (2)(a)  The agency shall enroll in a managed care plan

 4  or MediPass all Medicaid recipients, except those Medicaid

 5  recipients who are: in an institution; enrolled in the

 6  Medicaid medically needy program; or eligible for both

 7  Medicaid and Medicare. Upon enrollment, individuals will be

 8  able to change their managed care option during the 90-day opt

 9  out period required by federal Medicaid regulations. The

10  agency is authorized to seek the necessary Medicaid state plan

11  amendment to implement this policy. However, to the extent

12  permitted by federal law, the agency may enroll in a managed

13  care plan or MediPass a Medicaid recipient who is exempt from

14  mandatory managed care enrollment, provided that:

15         1.  The recipient's decision to enroll in a managed

16  care plan or MediPass is voluntary;

17         2.  If the recipient chooses to enroll in a managed

18  care plan, the agency has determined that the managed care

19  plan provides specific programs and services which address the

20  special health needs of the recipient; and

21         3.  The agency receives any necessary waivers from the

22  federal Centers for Medicare and Medicaid Services Health Care

23  Financing Administration.

24  

25  The agency shall develop rules to establish policies by which

26  exceptions to the mandatory managed care enrollment

27  requirement may be made on a case-by-case basis. The rules

28  shall include the specific criteria to be applied when making

29  a determination as to whether to exempt a recipient from

30  mandatory enrollment in a managed care plan or MediPass.

31  School districts participating in the certified school match

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 1  program pursuant to ss. 409.908(21) and 1011.70 shall be

 2  reimbursed by Medicaid, subject to the limitations of s.

 3  1011.70(1), for a Medicaid-eligible child participating in the

 4  services as authorized in s. 1011.70, as provided for in s.

 5  409.9071, regardless of whether the child is enrolled in

 6  MediPass or a managed care plan. Managed care plans shall make

 7  a good faith effort to execute agreements with school

 8  districts regarding the coordinated provision of services

 9  authorized under s. 1011.70. County health departments

10  delivering school-based services pursuant to ss. 381.0056 and

11  381.0057 shall be reimbursed by Medicaid for the federal share

12  for a Medicaid-eligible child who receives Medicaid-covered

13  services in a school setting, regardless of whether the child

14  is enrolled in MediPass or a managed care plan. Managed care

15  plans shall make a good faith effort to execute agreements

16  with county health departments regarding the coordinated

17  provision of services to a Medicaid-eligible child. To ensure

18  continuity of care for Medicaid patients, the agency, the

19  Department of Health, and the Department of Education shall

20  develop procedures for ensuring that a student's managed care

21  plan or MediPass provider receives information relating to

22  services provided in accordance with ss. 381.0056, 381.0057,

23  409.9071, and 1011.70.

24         (j)  The agency shall apply for a federal waiver from

25  the Centers for Medicare and Medicaid Services Health Care

26  Financing Administration to lock eligible Medicaid recipients

27  into a managed care plan or MediPass for 12 months after an

28  open enrollment period. After 12 months' enrollment, a

29  recipient may select another managed care plan or MediPass

30  provider. However, nothing shall prevent a Medicaid recipient

31  

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 1  from changing primary care providers within the managed care

 2  plan or MediPass program during the 12-month period.

 3         Section 6.  Subsection (2) of section 409.913, Florida

 4  Statutes, is amended, and subsection (36) is added to that

 5  section, to read:

 6         409.913  Oversight of the integrity of the Medicaid

 7  program.--The agency shall operate a program to oversee the

 8  activities of Florida Medicaid recipients, and providers and

 9  their representatives, to ensure that fraudulent and abusive

10  behavior and neglect of recipients occur to the minimum extent

11  possible, and to recover overpayments and impose sanctions as

12  appropriate. Beginning January 1, 2003, and each year

13  thereafter, the agency and the Medicaid Fraud Control Unit of

14  the Department of Legal Affairs shall submit a joint report to

15  the Legislature documenting the effectiveness of the state's

16  efforts to control Medicaid fraud and abuse and to recover

17  Medicaid overpayments during the previous fiscal year. The

18  report must describe the number of cases opened and

19  investigated each year; the sources of the cases opened; the

20  disposition of the cases closed each year; the amount of

21  overpayments alleged in preliminary and final audit letters;

22  the number and amount of fines or penalties imposed; any

23  reductions in overpayment amounts negotiated in settlement

24  agreements or by other means; the amount of final agency

25  determinations of overpayments; the amount deducted from

26  federal claiming as a result of overpayments; the amount of

27  overpayments recovered each year; the amount of cost of

28  investigation recovered each year; the average length of time

29  to collect from the time the case was opened until the

30  overpayment is paid in full; the amount determined as

31  uncollectible and the portion of the uncollectible amount

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 1  subsequently reclaimed from the Federal Government; the number

 2  of providers, by type, that are terminated from participation

 3  in the Medicaid program as a result of fraud and abuse; and

 4  all costs associated with discovering and prosecuting cases of

 5  Medicaid overpayments and making recoveries in such cases. The

 6  report must also document actions taken to prevent

 7  overpayments and the number of providers prevented from

 8  enrolling in or reenrolling in the Medicaid program as a

 9  result of documented Medicaid fraud and abuse and must

10  recommend changes necessary to prevent or recover

11  overpayments.

12         (2)  The agency shall conduct, or cause to be conducted

13  by contract or otherwise, reviews, investigations, analyses,

14  audits, or any combination thereof, to determine possible

15  fraud, abuse, overpayment, or recipient neglect in the

16  Medicaid program and shall report the findings of any

17  overpayments in audit reports as appropriate. At least 5

18  percent of all audits shall be conducted on a random basis.

19         (36)  The agency shall provide to each Medicaid

20  recipient or his or her representative an explanation of

21  benefits in the form of a letter that is mailed to the most

22  recent address of the recipient on the record with the

23  Department of Children and Family Services. The explanation of

24  benefits must include the patient's name, the name of the

25  health care provider and the address of the location where the

26  service was provided, a description of all services billed to

27  Medicaid in terminology that should be understood by a

28  reasonable person, and information on how to report

29  inappropriate or incorrect billing to the agency or other law

30  enforcement entities for review or investigation.

31  

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 1         Section 7.  The Agency for Health Care Administration

 2  shall submit to the Legislature by December 15, 2005, a report

 3  on the legal and administrative barriers to enforcing section

 4  409.9081, Florida Statutes. The report must describe how many

 5  services require copayments, which providers collect

 6  copayments, and the total amount of copayments collected from

 7  recipients for all services required under section 409.9081,

 8  Florida Statutes, by provider type for the 2001-2002 through

 9  2004-2005 fiscal years. The agency shall recommend a mechanism

10  to enforce the requirement for Medicaid recipients to make

11  copayments which does not shift the copayment amount to the

12  provider. The agency shall also identify the federal or state

13  laws or regulations that permit Medicaid recipients to declare

14  impoverishment in order to avoid paying the copayment and

15  extent to which these statements of impoverishment are

16  verified. If claims of impoverishment are not currently

17  verified, the agency shall recommend a system for such

18  verification. The report must also identify any other

19  cost-sharing measures that could be imposed on Medicaid

20  recipients.

21         Section 8.  The Agency for Health Care Administration

22  shall submit to the Legislature by January 15, 2006,

23  recommendations to ensure that Medicaid is the payer of last

24  resort as required by section 409.910, Florida Statutes. The

25  report must identify the public and private entities that are

26  liable for primary payment of health care services and

27  recommend methods to improve enforcement of third-party

28  liability responsibility and repayment of benefits to the

29  state Medicaid program. The report must estimate the potential

30  recoveries that may be achieved through third-party liability

31  efforts if administrative and legal barriers are removed. The

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 1  report must recommend whether modifications to the agency's

 2  contingency-fee contract for third-party liability could

 3  enhance third-party liability for benefits provided to

 4  Medicaid recipients.

 5         Section 9.  The Agency for Health Care Administration

 6  shall study provider pay-for-performance systems developed by

 7  the United States Centers for Medicare and Medicaid Services

 8  for use in the federal Medicare system and those developed by

 9  private health insurance market to determine if these systems

10  can be used in this state's Medicaid program to improve the

11  quality of care while reducing inappropriate utilization. The

12  study must include a cost-benefit analysis to determine the

13  fiscal viability of introducing a pay-for-performance system

14  in this state's Medicaid program. The study must identify any

15  waivers of federal laws or regulations which would be

16  necessary to implement a pay-for-performance system and any

17  changes in provider contracts which are necessary to implement

18  this type of incentive system. The agency shall submit a

19  report on provider pay-for-performance systems to the

20  Legislature by January 15, 2006.

21         Section 10.  By January 15, 2006, the Office of Program

22  Policy Analysis and Government Accountability shall submit to

23  the Legislature a study of the nursing home diversion programs

24  of the Department of Elderly Affairs. The study may be

25  conducted by Office of Program Policy Analysis and Government

26  Accountability staff or by a consultant obtained through a

27  competitive bid. The study must use a statistically-valid

28  methodology to assess the percent of persons over a period of

29  2 years in the diversion program who would have entered a

30  nursing home without the diversion services, which services

31  are most frequently used, and which services are least

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 1  frequently used in the diversion programs. The study must

 2  determine whether the diversion programs are cost-effective or

 3  are an expansion of the Medicaid program because persons in

 4  the program would not have entered a nursing home within a

 5  2-year period regardless of the availability of the diversion

 6  programs.

 7         Section 11.  The Agency for Health Care Administration

 8  shall conduct an analysis of potential costs savings achieved

 9  through contracting with a multistate purchasing pool approved

10  by the federal Centers for Medicare and Medicaid Services for

11  drug-rebate administration, including, but not limited to,

12  calculating rebate amounts, invoicing manufacturers,

13  negotiating prices with manufacturers, negotiating disputes

14  with manufacturers, and maintaining a database of rebate

15  collections. The agency must submit to the Legislature its

16  analysis of this state's participation in multistate

17  purchasing pools by December 1, 2005.

18         Section 12.  The Agency for Health Care Administration

19  shall identify how many individuals in the long-term care

20  diversion programs who receive care at home have a

21  patient-responsibility payment associated with their

22  participation in the diversion program. If no system is

23  available to assess this information, the agency shall

24  determine the cost of creating a system to identify and

25  collect these payments and whether the cost of developing a

26  system for this purpose is offset by the amount of

27  patient-responsibility payments which could be collected with

28  the system. The agency shall report this information to the

29  Legislature by December 1, 2005.

30         Section 13.  The Office of Program Policy Analysis and

31  Government Accountability shall conduct a study of state

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 1  programs that allow non-Medicaid eligible persons under a

 2  certain income level to buy into the Medicaid program as if it

 3  was private insurance. The study shall examine Medicaid buy-in

 4  programs in other states to determine if there are any models

 5  that can be implemented in Florida which would provide access

 6  to uninsured Floridians and what effect this program would

 7  have on Medicaid expenditures based on the experience of

 8  similar states. The study must also examine whether the

 9  Medically Needy program could be redesigned to be a Medicaid

10  buy-in program. The study must be submitted to the Legislature

11  by January 1, 2006.

12         Section 14.  The sums of $850,000 in recurring funds

13  from the General Revenue Fund and $850,000 in recurring funds

14  from the Administrative Trust Fund are appropriated to the

15  Agency for Health Care Administration for the purpose of

16  contracting with a vendor to monitor and evaluate the clinical

17  practice patterns of providers and provide information to

18  improve patient care and reduce utilization as established in

19  section 1 of this act during the 2005-2006 fiscal year.

20         Section 15.  The sums of $1,100,000 in recurring funds

21  from the General Revenue Fund and $1,100,000 in recurring

22  funds from the Administrative Trust Fund are appropriated to

23  the Agency for Health Care Administration for the purpose of

24  contracting with a vendor to design a web-based database to

25  allow providers to review real-time utilization of Medicaid

26  services in order to coordinate care and identify potential

27  fraud and abuse as established in section 1 of this act during

28  the 2005-2006 fiscal year.

29         Section 16.  The sums of $7,500,000 in nonrecurring

30  funds from the General Revenue Fund and $7,500,000 in

31  nonrecurring funds from the Administrative Trust Fund are

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 1  appropriated to the Agency for Health Care Administration for

 2  the purpose of developing infrastructure and administrative

 3  resources necessary to develop the capitated managed care

 4  pilot program established in section 2 of this act during the

 5  2005-2006 fiscal year.

 6         Section 17.  The sums of $845,223 in recurring funds

 7  from the General Revenue Fund and $2,324,224 in recurring

 8  funds from the Administrative Trust Fund, and the sums of

 9  $3,935 in nonrecurring funds from the General Revenue Fund and

10  $3,934 in nonrecurring funds from the Administrative Trust

11  Fund are appropriated to the Agency for Health Care

12  Administration, and three positions are authorized, for the

13  purpose of developing a managed care encounter data

14  information system during the 2005-2006 fiscal year.

15         Section 18.  This act shall take effect July 1, 2005.

16  

17          STATEMENT OF SUBSTANTIAL CHANGES CONTAINED IN
                       COMMITTEE SUBSTITUTE FOR
18                        CS Senate Bill 838

19                                 

20  -    Appropriates $15,000,000 in non-recurring funds to AHCA
         for the ose of developing administrative infrastructure
21       necessary for the managed care pilot project.

22  -    Appropriates $1,700,000 in recurring funds to AHCA for
         the purpose of contracting with a vendor to monitor and
23       evaluate the clinical practice patterns of providers and
         provide information to improve patient care and reduce
24       utilization.

25  -    Appropriates $2,200,000 in recurring funds to AHCA for
         the purpose of contracting with a vendor to design a
26       web-based database to allow providers to review real-time
         utilization in order to coordinate care and identify
27       fraud and abuse.

28  -    Appropriates $3,169,447 in recurring funds, $7,869 in
         non-recurring funds, and three FTEs to AHCA for the
29       purpose of developing a managed care encounter data
         information system.
30  

31  

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