December 10, 2019
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Senate Bill 2910

Senate Bill sb2910c2

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    Florida Senate - 2004                    CS for CS for SB 2910

    By the Committees on Banking and Insurance; Health, Aging, and
    Long-Term Care; and Senator Peaden




    311-2442-04

  1                      A bill to be entitled

  2         An act relating to affordable health care;

  3         providing a popular name; providing purpose;

  4         amending s. 381.026, F.S.; requiring certain

  5         licensed facilities to provide public Internet

  6         access to certain financial information;

  7         providing a penalty; amending s. 381.734, F.S.;

  8         including participation by health care

  9         providers, small businesses, and health

10         insurers in the Healthy Communities, Healthy

11         People Program; requiring the Department of

12         Health to provide public Internet access to

13         certain public health programs; requiring the

14         department to monitor and assess the

15         effectiveness of such programs; requiring a

16         report; requiring the Office of Program Policy

17         and Government Accountability to evaluate the

18         effectiveness of such programs; requiring a

19         report; amending s. 395.1041, F.S.; authorizing

20         hospitals to develop certain emergency room

21         diversion programs; amending s. 395.301, F.S.;

22         requiring certain licensed facilities to

23         provide public Internet access to certain

24         financial information; requiring certain

25         licensed facilities to provide prospective

26         patients certain estimates of charges for

27         services; amending s. 408.061, F.S.; requiring

28         the Agency for Health Care Administration to

29         require health care facilities, health care

30         providers, and health insurers to submit

31         certain information; requiring the agency to

                                  1

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    Florida Senate - 2004                    CS for CS for SB 2910
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 1         adopt certain rules; amending s. 408.062, F.S.;

 2         requiring the agency to conduct certain health

 3         care costs and access research, analyses, and

 4         studies; expanding the scope of such studies to

 5         include collection of pharmacy retail price

 6         data, use of emergency departments, and

 7         Internet patient charge information

 8         availability; requiring a report; requiring the

 9         agency to conduct additional data-based studies

10         and make recommendations to the Legislature;

11         requiring the agency to implement a strategy

12         for the use of electronic health records and

13         make recommendations to the Legislature to

14         protect the confidentiality of such records;

15         amending s. 408.05, F.S.; requiring the agency

16         to develop a plan to make performance outcome

17         and financial data available to consumers for

18         health care services comparison purposes;

19         requiring submittal of the plan to the Governor

20         and Legislature; requiring the agency to update

21         the plan; requiring the agency to make the plan

22         available electronically; providing plan

23         requirements; amending s. 409.9066, F.S.;

24         requiring the agency to provide certain

25         information relating to the Medicare

26         prescription discount program; amending s.

27         408.7056, F.S.; renaming the Statewide Provider

28         and Subscriber Assistance Program as the

29         Subscriber Assistance Program; revising

30         provisions to conform; expanding certain

31         records availability provisions; revising

                                  2

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    Florida Senate - 2004                    CS for CS for SB 2910
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 1         membership provisions relating to a subscriber

 2         grievance hearing panel; providing hearing

 3         procedures; amending s. 641.3154, F.S., to

 4         conform to the renaming of the Subscriber

 5         Assistance Program; amending s. 641.511, F.S.,

 6         to conform to the renaming of the Subscriber

 7         Assistance Program; adopting and incorporating

 8         by reference the Employee Retirement Income

 9         Security Act of 1974, as implemented by federal

10         regulations; amending s. 641.58, F.S., to

11         conform to the renaming of the Subscriber

12         Assistance Program; amending s. 408.909, F.S.;

13         expanding a definition of "health flex plan

14         entity" to include public-private partnerships;

15         making a pilot health flex plan program apply

16         permanently statewide; providing additional

17         program requirements; creating s. 381.0271,

18         F.S.; providing definitions; creating the

19         Florida Patient Safety Corporation, which shall

20         be registered, incorporated, organized, and

21         operated in compliance with ch. 617, F.S.;

22         authorizing the corporation to create

23         not-for-profit subsidiaries; specifying that

24         the corporation is not an agency within the

25         meaning of s. 20.03(11), F.S.; requiring the

26         corporation to be subject to public meetings

27         and records requirements; specifying that the

28         corporation is not subject to the provisions of

29         ch. 297, F.S., relating to procurement of

30         personal property and services; providing a

31         purpose for the corporation; establishing the

                                  3

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 1         membership of the board of directors of the

 2         corporation; requiring the formation of certain

 3         advisory committees for the corporation;

 4         requiring the Agency for Health Care

 5         Administration to provide assistance in

 6         establishing the corporation; specifying the

 7         powers and duties of the corporation; requiring

 8         annual reports; requiring the Office of Program

 9         Policy Analysis and Government Accountability,

10         in consultation with the Agency for Health Care

11         Administration and the Department of Health, to

12         develop performance measures for the

13         corporation; requiring a performance audit;

14         requiring a report to the Governor and the

15         Legislature; requiring the Patient Safety

16         Center at the Florida State University College

17         of Medicine to study the return on investment

18         by hospitals from implementing computerized

19         physician order entry and other information

20         technologies related to patient safety;

21         providing requirements for the study; requiring

22         a report to the Governor and the Legislature;

23         amending s. 395.1012, F.S.; providing

24         additional duties of the patient safety

25         committee at hospitals and other licensed

26         facilities; requiring such facilities to adopt

27         a plan to reduce medication errors and adverse

28         drug events, including the use of computerized

29         physician order entry and other information

30         technologies; repealing s. 766.1016(3), F.S.,

31         which requires a patient safety organization to

                                  4

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    Florida Senate - 2004                    CS for CS for SB 2910
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 1         promptly remove patient-identifying information

 2         from patient safety data reported to the

 3         organization and requires such organization to

 4         maintain the confidentiality of

 5         patient-identifying information; amending s.

 6         409.91255, F.S.; expanding assistance to

 7         certain health centers to include community

 8         emergency room diversion programs and urgent

 9         care services; amending s. 627.410, F.S.;

10         requiring insurers to file certain rates with

11         the Office of Insurance Regulation; exempting

12         group health insurance policies insuring groups

13         of a certain size from a requirement to file

14         rates with the Office of Insurance Regulation;

15         creating s. 624.6405, F.S.; making legislative

16         findings related to inappropriate utilization

17         of emergency room care; requiring health

18         insurers to take certain actions and

19         authorizing higher copayments for certain uses

20         of emergency departments; amending s. 627.6487,

21         F.S.; revising a definition; creating s.

22         627.64872, F.S.; providing legislative intent;

23         creating the Florida Health Insurance Plan for

24         certain purposes; providing definitions;

25         providing requirements for operation of the

26         plan; providing for a board of directors;

27         providing for appointment of members; providing

28         for terms; specifying service without

29         compensation; providing for travel and per diem

30         expenses; requiring a plan of operation;

31         providing requirements; providing for powers of

                                  5

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 1         the plan; requiring reports to the Governor and

 2         Legislature; providing certain immunity from

 3         liability for plan obligations; authorizing the

 4         board to provide for indemnification of certain

 5         costs; requiring an annually audited financial

 6         statement; providing for eligibility for

 7         coverage under the plan; providing criteria;

 8         requirements, and limitations; specifying

 9         certain activity as an unfair trade practice;

10         providing for a plan administrator; providing

11         criteria; providing requirements; providing

12         term limits for the plan administrator;

13         providing duties; providing for paying the

14         administrator; providing for funding mechanisms

15         of the plan; providing for premium rates for

16         plan coverage; providing rate limitations;

17         providing for assessing certain insurers

18         providing coverage for persons under the Health

19         Insurance Portability and Accountability Act;

20         specifying benefits under the plan; providing

21         criteria, requirements, and limitations;

22         providing for nonduplication of benefits;

23         providing for annual and maximum lifetime

24         benefits; providing for tax exempt status;

25         providing for abolition of the Florida

26         Comprehensive Health Association upon

27         implementation of the plan; providing for

28         enrollment in the plan of persons enrolled in

29         the association; requiring insurers to pay

30         certain assessments to the board for certain

31         purposes; providing criteria, requirements, and

                                  6

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 1         limitations for such assessments; providing for

 2         repeal of ss. 627.6488, 627.6489, 627.649,

 3         627.6492, 627.6494, 627.6496, and 627.6498,

 4         F.S., relating to the Florida Comprehensive

 5         Health Association, upon implementation of the

 6         plan; amending s. 627.662, F.S.; providing for

 7         application of certain claim payment

 8         methodologies and actions related to

 9         inappropriate use of emergency care to certain

10         types of insurance; amending s. 627.6699, F.S.;

11         revising provisions requiring small employer

12         carriers to offer certain health benefit plans;

13         preserving a right to open enrollment for

14         certain small groups; revising size limits on

15         small employer groups to which premium rate

16         guidelines are applicable for purposes of the

17         Employee Health Care Access Act; requiring

18         small employer carriers to file and provide

19         coverage under certain high deductible plans;

20         including high deductible plans under certain

21         required plan provisions; creating the Small

22         Employers Access Program; providing legislative

23         intent; providing definitions; providing

24         participation eligibility requirements and

25         criteria; requiring the Office of Insurance

26         Regulation to administer the program by

27         selecting an insurer through competitive

28         bidding; providing requirements; specifying

29         insurer qualifications; providing duties of the

30         insurer; providing a contract term; providing

31         insurer reporting requirements; providing

                                  7

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    Florida Senate - 2004                    CS for CS for SB 2910
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 1         application requirements; providing for

 2         benefits under the program; requiring the

 3         office to annually report to the Governor and

 4         Legislature; providing for decreases in

 5         inappropriate use of emergency care; providing

 6         legislative intent; requiring health insurers

 7         to provide certain information electronically

 8         and develop community emergency department

 9         diversion programs; amending s. 627.9175, F.S.;

10         requiring certain health insurers to annually

11         report certain coverage information to the

12         office; providing requirements; deleting

13         certain reporting requirements; creating part I

14         of ch. 636, F.S., relating to prepaid limited

15         health services organization; providing a short

16         title; revising the definition of the term

17         "prepaid limited health services organization";

18         creating part II of ch. 636, F.S., relating to

19         discount medical plan organization; providing a

20         short title; providing definitions; requiring

21         that a person be licensed before conducting

22         business in this state as a discount medical

23         plan organizations; providing for an

24         application to receive a license; providing for

25         the contents of the application; requiring each

26         discount medical plan organization to create an

27         Internet website; authorizing the Office of

28         Insurance Regulation to investigate or examine

29         a discount medical plan organization under

30         certain conditions; specifying the permitted

31         and prohibited activities of a discount medical

                                  8

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    Florida Senate - 2004                    CS for CS for SB 2910
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 1         plan organization; directing each discount

 2         medical plan organization to disclose certain

 3         specified information to members and

 4         prospective members; providing for contracts

 5         and agreements with providers and networks of

 6         providers; detailing the required contents of

 7         the contract or agreement; requiring each

 8         discount medical plan organization to file its

 9         proposed rates with the office; directing each

10         discount medical plan organization to file an

11         annual report with the office; specifying the

12         contents of the report; providing for fines

13         when a discount medical plan organization is

14         delinquent in filing the annual report;

15         requiring minimum capitalization; providing the

16         circumstances and procedures when the office

17         proposes to suspend or revoke the license of a

18         discount medical plan organization; directing

19         each discount medical plan organization to

20         maintain an up-to-date list of the names and

21         addresses of the providers with whom it has a

22         contract to deliver medical services; directing

23         that the list be posted on the organization's

24         website; providing for marketing plans;

25         authorizing the office to adopt rules;

26         providing for service of process; providing for

27         a security deposit by each discount medical

28         plan organization; providing criminal penalties

29         for violations of the act; authorizing the

30         office to seek temporary and permanent

31         injunctive relief against a discount medical

                                  9

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    Florida Senate - 2004                    CS for CS for SB 2910
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 1         plan organization under certain conditions;

 2         providing civil remedies for any person injured

 3         by another acting in violation of the act;

 4         providing venue for a civil action; creating

 5         ss. 627.65626 and 627.6402, F.S.; providing for

 6         insurance rebates for healthy lifestyles;

 7         providing for rebate of certain premiums for

 8         participation in health wellness, maintenance,

 9         or improvement programs under certain

10         circumstances; providing requirements; amending

11         s. 641.31, F.S.; authorizing health maintenance

12         organizations offering certain point-of-service

13         riders to offer such riders to certain

14         employers for certain employees; providing

15         requirements and limitations; providing for

16         application of certain claim payment

17         methodologies to certain types of insurance;

18         providing for rebate of certain premiums for

19         participation in health wellness, maintenance,

20         or improvement programs under certain

21         circumstances; providing requirements;

22         preserving certain rights to enrollment in

23         certain health benefit coverage for certain

24         groups under certain circumstances; creating s.

25         465.0244, F.S.; requiring each pharmacy to make

26         available on its Internet website a link to

27         certain performance outcome and financial data

28         of the Agency for Health Care Administration

29         and a notice of the availability of such

30         information; amending s. 627.6499, F.S.;

31         requiring each health insurer to make available

                                  10

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    Florida Senate - 2004                    CS for CS for SB 2910
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 1         on its Internet website a link to certain

 2         performance outcome and financial data of the

 3         Agency for Health Care Administration and a

 4         notice in policies of the availability of such

 5         information; amending s. 641.54, F.S.;

 6         requiring health maintenance organizations to

 7         make certain insurance financial information

 8         available to subscribers; requiring health

 9         maintenance organizations to make available on

10         its Internet website a link to certain

11         performance outcome and financial data of the

12         Agency for Health Care Administration and a

13         notice in policies of the availability of such

14         information; repealing s. 408.02, F.S.,

15         relating to the development, endorsement,

16         implementation, and evaluation of patient

17         management practice parameters by the Agency

18         for Health Care Administration; repealing s.

19         766.1016(3), F.S., which requires a patient

20         safety organization to promptly remove

21         patient-identifying information from patient

22         safety data reported to the organization and

23         requires such organization to maintain the

24         confidentiality of patient-identifying

25         information; providing appropriations;

26         providing an effective date.

27  

28         WHEREAS, according to the Kaiser Family Foundation,

29  eight out of ten uninsured Americans are workers or dependents

30  of workers and nearly eight out of ten uninsured Americans

31  have family incomes above the poverty level, and

                                  11

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 1         WHEREAS, fifty-five percent of those who do not have

 2  insurance state the reason they don't have insurance is lack

 3  of affordability, and

 4         WHEREAS, average health insurance premium increases for

 5  the last two years have been in the range of ten to twenty

 6  percent for Florida's employers, and

 7         WHEREAS, an increasing number of employers are opting

 8  to cease providing insurance coverage to their employees due

 9  to the high cost, and

10         WHEREAS, an increasing number of employers who continue

11  providing coverage are forced to shift more premium cost to

12  their employees, thus diminishing the value of employee wage

13  increases, and

14         WHEREAS, according to studies, the rate of avoidable

15  hospitalization is fifty to seventy percent lower for the

16  insured versus the uninsured, and

17         WHEREAS, according to Florida Cancer Registry data, the

18  uninsured have a seventy percent greater chance of a late

19  diagnosis, thus decreasing the chances of a positive health

20  outcome, and

21         WHEREAS, according to the Agency for Health Care

22  Administration's 2002 financial data, uncompensated care in

23  Florida's hospitals is growing at the rate of twelve to

24  thirteen percent per year, and, at $4.3 billion in 2001, this

25  cost, when shifted to Floridians who remain insured, is not

26  sustainable, and

27         WHEREAS, the Florida Legislature, through the creation

28  of Health Flex, has already identified the need for lower cost

29  alternatives, and

30         WHEREAS, it is of vital importance and in the best

31  interests of the people of the State of Florida that the issue

                                  12

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    Florida Senate - 2004                    CS for CS for SB 2910
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 1  of available, affordable health care insurance be addressed in

 2  a cohesive and meaningful manner, and

 3         WHEREAS, there is general recognition that the issues

 4  surrounding the problem of access to affordable health

 5  insurance are complicated and multifaceted, NOW, THEREFORE,

 6  

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

 8  

 9         Section 1.  This act may be referred to by the popular

10  name "The 2004 Affordable Health Care for Floridians Act."

11         Section 2.  The purpose of this act is to address the

12  underlying cause of the double-digit increases in health

13  insurance premiums by mitigating the overall growth in health

14  care costs.

15         Section 3.  Paragraph (c) of subsection (4) of section

16  381.026, Florida Statutes, is amended to read:

17         381.026  Florida Patient's Bill of Rights and

18  Responsibilities.--

19         (4)  RIGHTS OF PATIENTS.--Each health care facility or

20  provider shall observe the following standards:

21         (c)  Financial information and disclosure.--

22         1.  A patient has the right to be given, upon request,

23  by the responsible provider, his or her designee, or a

24  representative of the health care facility full information

25  and necessary counseling on the availability of known

26  financial resources for the patient's health care.

27         2.  A health care provider or a health care facility

28  shall, upon request, disclose to each patient who is eligible

29  for Medicare, in advance of treatment, whether the health care

30  provider or the health care facility in which the patient is

31  receiving medical services accepts assignment under Medicare

                                  13

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    Florida Senate - 2004                    CS for CS for SB 2910
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 1  reimbursement as payment in full for medical services and

 2  treatment rendered in the health care provider's office or

 3  health care facility.

 4         3.  A health care provider or a health care facility

 5  shall, upon request, furnish a patient, prior to provision of

 6  medical services, a reasonable estimate of charges for such

 7  services. Such reasonable estimate shall not preclude the

 8  health care provider or health care facility from exceeding

 9  the estimate or making additional charges based on changes in

10  the patient's condition or treatment needs.

11         4.  Each licensed facility not operated by the state

12  shall make available to the public on its Internet website or

13  by other electronic means information regarding package price

14  of service. The term "package pricing" means all

15  facility-related charges for all services typically associated

16  with a procedure or diagnosis-related group. The facility

17  shall maintain on its website a description of and a link to

18  the agency's website which provides an average cost of the top

19  50 inpatient and top 50 outpatient services provided. The

20  facility shall place a notice in the reception areas that such

21  information is available electronically and the website

22  address. The licensed facility may indicate that the pricing

23  information is based on a compilation of charges for the

24  average patient and that each patient's bill may vary from the

25  average depending upon the severity of illness and individual

26  resources consumed. The licensed facility may also indicate

27  that the price of service is negotiable for eligible patients

28  based upon the patient's ability to pay.

29         5.4.  A patient has the right to receive a copy of an

30  itemized bill upon request. A patient has a right to be given

31  an explanation of charges upon request.

                                  14

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 1         6.  Failure to provide data upon request as required by

 2  this paragraph shall result in a fine of $500 for each

 3  instance of the facility's failure to provide the requested

 4  information.

 5         Section 4.  Subsection (1) and paragraph (g) of

 6  subsection (3) of section 381.734, Florida Statutes, are

 7  amended, and subsections (4), (5), and (6) are added to that

 8  section, to read:

 9         381.734  Healthy Communities, Healthy People Program.--

10         (1)  The department shall develop and implement the

11  Healthy Communities, Healthy People Program, a comprehensive

12  and community-based health promotion and wellness program. The

13  program shall be designed to reduce major behavioral risk

14  factors associated with chronic diseases, including those

15  chronic diseases identified in chapter 385, by enhancing the

16  knowledge, skills, motivation, and opportunities for

17  individuals, organizations, health care providers, small

18  businesses, health insurers, and communities to develop and

19  maintain healthy lifestyles.

20         (3)  The program shall include:

21         (g)  The establishment of a comprehensive program to

22  inform the public, health care professionals, health insurers,

23  and communities about the prevalence of chronic diseases in

24  the state; known and potential risks, including social and

25  behavioral risks; and behavior changes that would reduce

26  risks.

27         (4)  The department shall make available on its

28  Internet website, no later than October 1, 2004, and in a

29  hard-copy format upon request, a listing of age-specific,

30  disease-specific, and community-specific health promotion,

31  preventive care, and wellness programs offered and established

                                  15

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 1  under the Healthy Communities, Healthy People Program. The

 2  website shall also provide residents with information to

 3  identify behavior risk factors that lead to diseases that are

 4  preventable by maintaining a healthy lifestyle. The website

 5  shall allow consumers to select by county or region

 6  disease-specific statistical information.

 7         (5)  The department shall monitor and assess the

 8  effectiveness of such programs. The department shall submit a

 9  status report based on this monitoring and assessment to the

10  Governor, the President of the Senate, the Speaker of the

11  House of Representatives, and the substantive committees of

12  each house of the Legislature, with the first annual report

13  due January 31, 2005.

14         (6)  The Office of Program Policy and Government

15  Accountability shall evaluate and report to the Governor, the

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

17  Representatives, by March 1, 2005, on the effectiveness of the

18  department's monitoring and assessment of the program's

19  effectiveness.

20         Section 5.  Subsection (7) is added to section

21  395.1041, Florida Statutes, to read:

22         395.1041  Access to emergency services and care.--

23         (7)  EMERGENCY ROOM DIVERSION PROGRAMS.--Hospitals may

24  develop emergency room diversion programs, including, but not

25  limited to, an "Emergency Hotline" which allows patients to

26  help determine if emergency department services are

27  appropriate or if other health care settings may be more

28  appropriate for care, and a "Fast Track" program allowing

29  nonemergency patients to be treated at an alternative site.

30  Alternative sites may include health care programs funded with

31  local tax revenue and federally funded community health

                                  16

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 1  centers, county health departments, or other nonhospital

 2  providers of health care services. The program may include

 3  provisions for followup care and case management.

 4         Section 6.  Subsections (7) and (8) are added to

 5  section 395.301, Florida Statutes, to read:

 6         395.301  Itemized patient bill; form and content

 7  prescribed by the agency.--

 8         (7)  Each licensed facility not operated by the state

 9  shall provide, prior to provision of any medical services, an

10  estimate of charges for the proposed service upon request of a

11  prospective patient who does not have insurance coverage or

12  whose insurer or health maintenance organization does not have

13  a contract with the hospital and an emergency medical

14  condition does not exist or the service is not a covered

15  service. The estimate may be the average charges for that

16  diagnosis-related group or the average charges for that

17  procedure. Such estimate shall not preclude the actual charges

18  from exceeding the estimate. The facility shall place a notice

19  in reception areas that such information is available

20  electronically and the website address.

21         (8)  Each licensed facility shall make available on its

22  Internet website a link to the performance outcome and

23  financial data that is published by the Agency for Health Care

24  Administration pursuant to s. 408.05(3)(l).

25         Section 7.  Subsection (1) of section 408.061, Florida

26  Statutes, is amended to read:

27         408.061  Data collection; uniform systems of financial

28  reporting; information relating to physician charges;

29  confidential information; immunity.--

30         (1)  The agency shall may require the submission by

31  health care facilities, health care providers, and health

                                  17

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 1  insurers of data necessary to carry out the agency's duties.

 2  Specifications for data to be collected under this section

 3  shall be developed by the agency with the assistance of

 4  technical advisory panels including representatives of

 5  affected entities, consumers, purchasers, and such other

 6  interested parties as may be determined by the agency.

 7         (a)  Data to be submitted by health care facilities,

 8  including the facilities as defined in chapter 395, shall may

 9  include, but are not limited to: case-mix data, patient

10  admission and or discharge data, outpatient data which shall

11  include the number of patients treated in the emergency

12  department of a licensed hospital reported by patient acuity

13  level, data on hospital-acquired infections as specified by

14  rule, data on complications including date of diagnosis as

15  specified by rule, data on readmissions as specified by rule,

16  with patient and provider-specific identifiers included,

17  actual charge data by diagnostic groups, financial data,

18  accounting data, operating expenses, expenses incurred for

19  rendering services to patients who cannot or do not pay,

20  interest charges, depreciation expenses based on the expected

21  useful life of the property and equipment involved, and

22  demographic data. The agency shall adopt the 3M All Patient

23  Refined DRG software risk and severity adjustment methodology

24  for all data submitted as required by this section. Data may

25  be obtained from documents such as, but not limited to:

26  leases, contracts, debt instruments, itemized patient bills,

27  medical record abstracts, and related diagnostic information.

28  Reported data elements shall be reported electronically in

29  accordance with Rule 59E-7.012, Florida Administrative Code.

30  Data submitted shall be certified by the Chief Executive

31  Officer or an appropriate and duly authorized representative

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 1  or employee of the licensed facility that the information

 2  submitted is true and accurate.

 3         (b)  Data to be submitted by health care providers may

 4  include, but are not limited to: Medicare and Medicaid

 5  participation, types of services offered to patients, amount

 6  of revenue and expenses of the health care provider, and such

 7  other data which are reasonably necessary to study utilization

 8  patterns.

 9         (c)  Data to be submitted by health insurers may

10  include percentage of claims denied, percentage of claims

11  meeting prompt pay requirements, and medical and

12  administrative loss ratios, but are not limited to: claims,

13  premium, administration, and financial information. Data

14  submitted shall be certified by the appropriate and duly

15  authorized representative or employee of the insurer that the

16  information submitted is true and accurate.

17         (d)  Data required to be submitted by health care

18  facilities, health care providers, or health insurers shall

19  not include specific provider contract reimbursement

20  information. However, such specific provider reimbursement

21  data shall be reasonably available for onsite inspection by

22  the agency as is necessary to carry out the agency's

23  regulatory duties. Any such data obtained by the agency as a

24  result of onsite inspections may not be used by the state for

25  purposes of direct provider contracting and are confidential

26  and exempt from the provisions of s. 119.07(1) and s. 24(a),

27  Art. I of the State Constitution.

28         (e)  A requirement to submit data shall be adopted by

29  rule if the submission of data is being required of all

30  members of any type of health care facility, health care

31  provider, or health insurer. Rules are not required, however,

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 1  for the submission of data for a special study mandated by the

 2  Legislature or when information is being requested for a

 3  single health care facility, health care provider, or health

 4  insurer.

 5         Section 8.  Subsections (1) and (4) of section 408.062,

 6  Florida Statutes, are amended to read:

 7         408.062  Research, analyses, studies, and reports.--

 8         (1)  The agency shall have the authority to conduct

 9  research, analyses, and studies relating to health care costs

10  and access to and quality of health care services as access

11  and quality are affected by changes in health care costs. Such

12  research, analyses, and studies shall include, but not be

13  limited to, research and analysis relating to:

14         (a)  The financial status of any health care facility

15  or facilities subject to the provisions of this chapter.

16         (b)  The impact of uncompensated charity care on health

17  care facilities and health care providers.

18         (c)  The state's role in assisting to fund indigent

19  care.

20         (d)  In conjunction with the Office of Insurance

21  Regulation, the availability and affordability of health

22  insurance for small businesses.

23         (e)  Total health care expenditures in the state

24  according to the sources of payment and the type of

25  expenditure.

26         (f)  The quality of health services, using techniques

27  such as small area analysis, severity adjustments, and

28  risk-adjusted mortality rates.

29         (g)  The development of physician information payment

30  systems which are capable of providing data for health care

31  consumers taking into account the amount of resources consumed

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 1  at licensed facilities as defined in chapter 395 and the

 2  outcomes produced in the delivery of care.

 3         (h)  The collection of a statistically valid sample of

 4  data on the retail prices charged by pharmacies for the 50

 5  most frequently prescribed medicines from any pharmacy

 6  licensed by this state as a special study authorized by the

 7  Legislature to be performed by the agency quarterly. If the

 8  drug is available generically, price data shall be reported

 9  for the generic drug and price data of a brand-named drug for

10  which the generic drug is the equivalent shall be reported.

11  The agency shall make drug prices for a 30-day supply at a

12  standard dose available on its Internet website for each

13  pharmacy no later than October 1, 2005. The data collected

14  shall be reported for each drug by pharmacy and by

15  metropolitan statistical area or region and updated quarterly

16  The impact of subacute admissions on hospital revenues and

17  expenses for purposes of calculating adjusted admissions as

18  defined in s. 408.07.

19         (i)  The use of emergency department services by

20  patient acuity level and the implication of increasing

21  hospital cost by providing nonurgent care in emergency

22  departments. The agency shall submit an annual report based on

23  this monitoring and assessment to the Governor, the Speaker of

24  the House of Representatives, the President of the Senate, and

25  the substantive legislative committees with the first report

26  due January 1, 2006.

27         (j)  The making available on its Internet website no

28  later than October 1, 2004, and in a hard-copy format upon

29  request, of patient charge, volumes, length of stay, and

30  performance outcome indicators collected from health care

31  facilities pursuant to s. 408.061(1)(a) for specific medical

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 1  conditions, surgeries, and procedures provided in inpatient

 2  and outpatient facilities as determined by the agency. In

 3  making the determination of specific medical conditions,

 4  surgeries, and procedures to include, the agency shall

 5  consider such factors as volume, severity of the illness,

 6  urgency of admission, individual and societal costs, and

 7  whether the condition is acute or chronic. Performance outcome

 8  indicators shall be risk adjusted or severity adjusted as

 9  applicable using 3M All Patient Refined DRG's. The website

10  shall also provide an interactive search that allows consumers

11  to view and compare the information for specific facilities, a

12  map that allows consumers to select a county or region,

13  definitions of all of the data, descriptions of each

14  procedure, and an explanation about why the data may differ

15  from facility to facility. Such public data shall be updated

16  quarterly. The agency shall submit an annual status report on

17  the collection of data and publication of performance outcome

18  indicators to the Governor, the Speaker of the House of

19  Representatives, the President of the Senate, and the

20  substantive legislative committees with the first status

21  report due January 1, 2005.

22         (4)(a)  The agency shall may conduct data-based studies

23  and evaluations and make recommendations to the Legislature

24  and the Governor concerning exemptions, the effectiveness of

25  limitations of referrals, restrictions on investment interests

26  and compensation arrangements, and the effectiveness of public

27  disclosure. Such analysis shall may include, but need not be

28  limited to, utilization of services, cost of care, quality of

29  care, and access to care. The agency may require the

30  submission of data necessary to carry out this duty, which may

31  include, but need not be limited to, data concerning

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 1  ownership, Medicare and Medicaid, charity care, types of

 2  services offered to patients, revenues and expenses,

 3  patient-encounter data, and other data reasonably necessary to

 4  study utilization patterns and the impact of health care

 5  provider ownership interests in health-care-related entities

 6  on the cost, quality, and accessibility of health care.

 7         (b)  The agency may collect such data from any health

 8  facility or licensed health care provider as a special study.

 9         (5)  The agency shall develop and implement a strategy

10  for the adoption and use of electronic health records. The

11  agency may develop rules to facilitate the functionality and

12  protect the confidentiality of electronic health records. The

13  agency shall report to the Governor, the Speaker of the House,

14  and the President of the Senate on legislative recommendations

15  to protect the confidentiality of electronic health records.

16         Section 9.  Paragraph (l) is added to subsection (3) of

17  section 408.05, Florida Statutes, to read:

18         408.05  State Center for Health Statistics.--

19         (3)  COMPREHENSIVE HEALTH INFORMATION SYSTEM.--In order

20  to produce comparable and uniform health information and

21  statistics, the agency shall perform the following functions:

22         (l)  Develop, in conjunction with the State

23  Comprehensive Health Information System Advisory Council, and

24  implement a long-range plan for making available performance

25  outcome and financial data that will allow consumers to

26  compare health care services. The performance outcomes and

27  financial data the agency must make available shall include,

28  but is not limited to, pharmaceuticals, physicians, health

29  care facilities, and health plans and managed care entities.

30  The agency shall submit the initial plan to the Governor, the

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

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 1  Representatives by March 1, 2005, and shall update the plan

 2  and report on the status of its implementation annually

 3  thereafter. The agency shall also make the plan and status

 4  report available to the public on its Internet website. As

 5  part of the plan, the agency shall identify the process and

 6  timeframes for implementation, any barriers to implementation,

 7  and recommendations of changes in the law that may be enacted

 8  by the Legislature to eliminate the barriers. As preliminary

 9  elements of the plan, the agency shall:

10         1.  Make available performance outcome and patient

11  charge data collected from health care facilities pursuant to

12  s. 408.061(1)(a) and (2). The agency shall determine which

13  conditions and procedures, performance outcomes, and patient

14  charge data to disclose based upon input from the council.

15  When determining which conditions and procedures are to be

16  disclosed, the council and the agency shall consider variation

17  in costs, variation in outcomes, and magnitude of variations

18  and other relevant information. When determining which

19  performance outcomes to disclose, the agency:

20         a.  Shall consider such factors as volume of cases;

21  average patient charges; average length of stay; complication

22  rates; mortality rates; and infection rates, among others,

23  which shall be adjusted for case mix and severity, if

24  applicable.

25         b.  May consider such additional measures that are

26  adopted by the Centers for Medicare and Medicaid Studies,

27  National Quality Forum, the Joint Commission on Accreditation

28  of Healthcare Organizations, the Agency for Healthcare

29  Research and Quality, or a similar national entity that

30  establishes standards to measure the performance of health

31  care providers, or by other states.

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 1  

 2  When determining which patient charge data to disclose, the

 3  agency shall consider such measures as average charge, average

 4  net revenue per adjusted patient day, average cost per

 5  adjusted patient day, and average cost per admission, among

 6  others.

 7         2.  Make available performance measures, benefit

 8  design, and premium cost data from health plans licensed

 9  pursuant to chapter 627 or chapter 641. The agency shall

10  determine which performance outcome and member and subscriber

11  cost data to disclose, based upon input from the council. When

12  determining which data to disclose, the agency shall consider

13  information that may be required by either individual or group

14  purchasers to assess the value of the product, which may

15  include membership satisfaction, quality of care, current

16  enrollment or membership, coverage areas, accreditation

17  status, premium costs, plan costs, premium increases, range of

18  benefits, copayments and deductibles, accuracy and speed of

19  claims payment, credentials of physicians, number of

20  providers, names of network providers, and hospitals in the

21  network.

22         3.  Determine the method and format for public

23  disclosure of data reported pursuant to this paragraph. The

24  agency shall make its determination based upon input from the

25  Comprehensive Health Information System Advisory Council. At a

26  minimum, the data shall be made available on the agency's

27  Internet website in a manner that allows consumers to conduct

28  an interactive search that allows them to view and compare the

29  information for specific providers. The website must include

30  such additional information as is determined necessary to

31  ensure that the website enhances informed decision making

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 1  among consumers and health care purchasers, which shall

 2  include, at a minimum, appropriate guidance on how to use the

 3  data and an explanation of why the data may vary from provider

 4  to provider. The data specified in subparagraph 1. shall be

 5  released no later than March 1, 2005. The data specified in

 6  subparagraph 2. shall be released no later than March 1, 2006.

 7         Section 10.  Subsection (3) of section 409.9066,

 8  Florida Statutes, is amended to read:

 9         409.9066  Medicare prescription discount program.--

10         (3)  The Agency for Health Care Administration shall

11  publish, on a free website available to the public, the most

12  recent average wholesale prices for the 200 drugs most

13  frequently dispensed to the elderly and, to the extent

14  possible, shall provide a mechanism that consumers may use to

15  calculate the retail price and the price that should be paid

16  after the discount required in subsection (1) is applied. The

17  agency shall provide retail information by geographic area and

18  retail information by provider within geographical areas.

19         Section 11.  Section 408.7056, Florida Statutes, is

20  amended to read:

21         408.7056  Statewide Provider and Subscriber Assistance

22  Program.--

23         (1)  As used in this section, the term:

24         (a)  "Agency" means the Agency for Health Care

25  Administration.

26         (b)  "Department" means the Department of Financial

27  Services.

28         (c)  "Grievance procedure" means an established set of

29  rules that specify a process for appeal of an organizational

30  decision.

31  

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 1         (d)  "Health care provider" or "provider" means a

 2  state-licensed or state-authorized facility, a facility

 3  principally supported by a local government or by funds from a

 4  charitable organization that holds a current exemption from

 5  federal income tax under s. 501(c)(3) of the Internal Revenue

 6  Code, a licensed practitioner, a county health department

 7  established under part I of chapter 154, a prescribed

 8  pediatric extended care center defined in s. 400.902, a

 9  federally supported primary care program such as a migrant

10  health center or a community health center authorized under s.

11  329 or s. 330 of the United States Public Health Services Act

12  that delivers health care services to individuals, or a

13  community facility that receives funds from the state under

14  the Community Alcohol, Drug Abuse, and Mental Health Services

15  Act and provides mental health services to individuals.

16         (e)  "Managed care entity" means a health maintenance

17  organization or a prepaid health clinic certified under

18  chapter 641, a prepaid health plan authorized under s.

19  409.912, or an exclusive provider organization certified under

20  s. 627.6472.

21         (f)  "Office" means the Office of Insurance Regulation

22  of the Financial Services Commission.

23         (g)  "Panel" means a statewide provider and subscriber

24  assistance panel selected as provided in subsection (11).

25         (2)  The agency shall adopt and implement a program to

26  provide assistance to subscribers and providers, including

27  those whose grievances are not resolved by the managed care

28  entity to the satisfaction of the subscriber or provider. The

29  program shall consist of one or more panels that meet as often

30  as necessary to timely review, consider, and hear grievances

31  and recommend to the agency or the office any actions that

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 1  should be taken concerning individual cases heard by the

 2  panel. The panel shall hear every grievance filed by

 3  subscribers and providers on behalf of subscribers, unless the

 4  grievance:

 5         (a)  Relates to a managed care entity's refusal to

 6  accept a provider into its network of providers;

 7         (b)  Is part of an internal grievance in a Medicare

 8  managed care entity or a reconsideration appeal through the

 9  Medicare appeals process which does not involve a quality of

10  care issue;

11         (c)  Is related to a health plan not regulated by the

12  state such as an administrative services organization,

13  third-party administrator, or federal employee health benefit

14  program;

15         (d)  Is related to appeals by in-plan suppliers and

16  providers, unless related to quality of care provided by the

17  plan;

18         (e)  Is part of a Medicaid fair hearing pursued under

19  42 C.F.R. ss. 431.220 et seq.;

20         (f)  Is the basis for an action pending in state or

21  federal court;

22         (g)  Is related to an appeal by nonparticipating

23  providers, unless related to the quality of care provided to a

24  subscriber by the managed care entity and the provider is

25  involved in the care provided to the subscriber;

26         (h)  Was filed before the subscriber or provider

27  completed the entire internal grievance procedure of the

28  managed care entity, the managed care entity has complied with

29  its timeframes for completing the internal grievance

30  procedure, and the circumstances described in subsection (6)

31  do not apply;

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 1         (i)  Has been resolved to the satisfaction of the

 2  subscriber or provider who filed the grievance, unless the

 3  managed care entity's initial action is egregious or may be

 4  indicative of a pattern of inappropriate behavior;

 5         (j)  Is limited to seeking damages for pain and

 6  suffering, lost wages, or other incidental expenses, including

 7  accrued interest on unpaid balances, court costs, and

 8  transportation costs associated with a grievance procedure;

 9         (k)  Is limited to issues involving conduct of a health

10  care provider or facility, staff member, or employee of a

11  managed care entity which constitute grounds for disciplinary

12  action by the appropriate professional licensing board and is

13  not indicative of a pattern of inappropriate behavior, and the

14  agency, office, or department has reported these grievances to

15  the appropriate professional licensing board or to the health

16  facility regulation section of the agency for possible

17  investigation; or

18         (l)  Is withdrawn by the subscriber or provider.

19  Failure of the subscriber or the provider to attend the

20  hearing shall be considered a withdrawal of the grievance.

21         (3)  The agency shall review all grievances within 60

22  days after receipt and make a determination whether the

23  grievance shall be heard. Once the agency notifies the panel,

24  the subscriber or provider, and the managed care entity that a

25  grievance will be heard by the panel, the panel shall hear the

26  grievance either in the network area or by teleconference no

27  later than 120 days after the date the grievance was filed.

28  The agency shall notify the parties, in writing, by facsimile

29  transmission, or by phone, of the time and place of the

30  hearing. The panel may take testimony under oath, request

31  certified copies of documents, and take similar actions to

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 1  collect information and documentation that will assist the

 2  panel in making findings of fact and a recommendation. The

 3  panel shall issue a written recommendation, supported by

 4  findings of fact, to the provider or subscriber, to the

 5  managed care entity, and to the agency or the office no later

 6  than 15 working days after hearing the grievance. If at the

 7  hearing the panel requests additional documentation or

 8  additional records, the time for issuing a recommendation is

 9  tolled until the information or documentation requested has

10  been provided to the panel. The proceedings of the panel are

11  not subject to chapter 120.

12         (4)  If, upon receiving a proper patient authorization

13  along with a properly filed grievance, the agency requests

14  medical records from a health care provider or managed care

15  entity, the health care provider or managed care entity that

16  has custody of the records has 10 days to provide the records

17  to the agency. Records include medical records, communication

18  logs associated with the grievance both to and from the

19  subscriber, contracts, and any other contents of the internal

20  grievance file associated with the complaint filed with the

21  Subscriber Assistance Program. Failure to provide requested

22  medical records may result in the imposition of a fine of up

23  to $500. Each day that records are not produced is considered

24  a separate violation.

25         (5)  Grievances that the agency determines pose an

26  immediate and serious threat to a subscriber's health must be

27  given priority over other grievances. The panel may meet at

28  the call of the chair to hear the grievances as quickly as

29  possible but no later than 45 days after the date the

30  grievance is filed, unless the panel receives a waiver of the

31  time requirement from the subscriber. The panel shall issue a

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 1  written recommendation, supported by findings of fact, to the

 2  office or the agency within 10 days after hearing the

 3  expedited grievance.

 4         (6)  When the agency determines that the life of a

 5  subscriber is in imminent and emergent jeopardy, the chair of

 6  the panel may convene an emergency hearing, within 24 hours

 7  after notification to the managed care entity and to the

 8  subscriber, to hear the grievance. The grievance must be heard

 9  notwithstanding that the subscriber has not completed the

10  internal grievance procedure of the managed care entity. The

11  panel shall, upon hearing the grievance, issue a written

12  emergency recommendation, supported by findings of fact, to

13  the managed care entity, to the subscriber, and to the agency

14  or the office for the purpose of deferring the imminent and

15  emergent jeopardy to the subscriber's life. Within 24 hours

16  after receipt of the panel's emergency recommendation, the

17  agency or office may issue an emergency order to the managed

18  care entity. An emergency order remains in force until:

19         (a)  The grievance has been resolved by the managed

20  care entity;

21         (b)  Medical intervention is no longer necessary; or

22         (c)  The panel has conducted a full hearing under

23  subsection (3) and issued a recommendation to the agency or

24  the office, and the agency or office has issued a final order.

25         (7)  After hearing a grievance, the panel shall make a

26  recommendation to the agency or the office which may include

27  specific actions the managed care entity must take to comply

28  with state laws or rules regulating managed care entities.

29         (8)  A managed care entity, subscriber, or provider

30  that is affected by a panel recommendation may within 10 days

31  after receipt of the panel's recommendation, or 72 hours after

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 1  receipt of a recommendation in an expedited grievance, furnish

 2  to the agency or office written evidence in opposition to the

 3  recommendation or findings of fact of the panel.

 4         (9)  No later than 30 days after the issuance of the

 5  panel's recommendation and, for an expedited grievance, no

 6  later than 10 days after the issuance of the panel's

 7  recommendation, the agency or the office may adopt the panel's

 8  recommendation or findings of fact in a proposed order or an

 9  emergency order, as provided in chapter 120, which it shall

10  issue to the managed care entity. The agency or office may

11  issue a proposed order or an emergency order, as provided in

12  chapter 120, imposing fines or sanctions, including those

13  contained in ss. 641.25 and 641.52. The agency or the office

14  may reject all or part of the panel's recommendation. All

15  fines collected under this subsection must be deposited into

16  the Health Care Trust Fund.

17         (10)  In determining any fine or sanction to be

18  imposed, the agency and the office may consider the following

19  factors:

20         (a)  The severity of the noncompliance, including the

21  probability that death or serious harm to the health or safety

22  of the subscriber will result or has resulted, the severity of

23  the actual or potential harm, and the extent to which

24  provisions of chapter 641 were violated.

25         (b)  Actions taken by the managed care entity to

26  resolve or remedy any quality-of-care grievance.

27         (c)  Any previous incidents of noncompliance by the

28  managed care entity.

29         (d)  Any other relevant factors the agency or office

30  considers appropriate in a particular grievance.

31  

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 1         (11)(a)  The panel shall consist of the Insurance

 2  Consumer Advocate, or designee thereof, established by s.

 3  627.0613; at least two members employed by the agency and at

 4  least two members employed by the department, chosen by their

 5  respective agencies; a consumer appointed by the Governor; a

 6  physician appointed by the Governor, as a standing member;

 7  and, if necessary, physicians who have expertise relevant to

 8  the case to be heard, on a rotating basis. The agency may

 9  contract with a medical director, and a primary care

10  physician, or both, who shall provide additional technical

11  expertise to the panel but shall not be voting members of the

12  panel. The medical director shall be selected from a health

13  maintenance organization with a current certificate of

14  authority to operate in Florida.

15         (b)  A majority of those panel members required under

16  paragraph (a) shall constitute a quorum for any meeting or

17  hearing of the panel. A grievance may not be heard or voted

18  upon at any panel meeting or hearing unless a quorum is

19  present, except that a minority of the panel may adjourn a

20  meeting or hearing until a quorum is present. A panel convened

21  for the purpose of hearing a subscriber's grievance in

22  accordance with subsections (2) and (3) shall not consist of

23  more than 11 members.

24         (12)  Every managed care entity shall submit a

25  quarterly report to the agency, the office, and the department

26  listing the number and the nature of all subscribers' and

27  providers' grievances which have not been resolved to the

28  satisfaction of the subscriber or provider after the

29  subscriber or provider follows the entire internal grievance

30  procedure of the managed care entity. The agency shall notify

31  all subscribers and providers included in the quarterly

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 1  reports of their right to file an unresolved grievance with

 2  the panel.

 3         (13)  A proposed order issued by the agency or office

 4  which only requires the managed care entity to take a specific

 5  action under subsection (7) is subject to a summary hearing in

 6  accordance with s. 120.574, unless all of the parties agree

 7  otherwise. If the managed care entity does not prevail at the

 8  hearing, the managed care entity must pay reasonable costs and

 9  attorney's fees of the agency or the office incurred in that

10  proceeding.

11         (14)(a)  Any information that identifies a subscriber

12  which is held by the panel, agency, or department pursuant to

13  this section is confidential and exempt from the provisions of

14  s. 119.07(1) and s. 24(a), Art. I of the State Constitution.

15  However, at the request of a subscriber or managed care entity

16  involved in a grievance procedure, the panel, agency, or

17  department shall release information identifying the

18  subscriber involved in the grievance procedure to the

19  requesting subscriber or managed care entity.

20         (b)  Meetings of the panel shall be open to the public

21  unless the provider or subscriber whose grievance will be

22  heard requests a closed meeting or the agency or the

23  department determines that information which discloses the

24  subscriber's medical treatment or history or information

25  relating to internal risk management programs as defined in s.

26  641.55(5)(c), (6), and (8) may be revealed at the panel

27  meeting, in which case that portion of the meeting during

28  which a subscriber's medical treatment or history or internal

29  risk management program information is discussed shall be

30  exempt from the provisions of s. 286.011 and s. 24(b), Art. I

31  

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 1  of the State Constitution. All closed meetings shall be

 2  recorded by a certified court reporter.

 3         Section 12.  Paragraph (c) of subsection (4) of section

 4  641.3154, Florida Statutes, is amended to read:

 5         641.3154  Organization liability; provider billing

 6  prohibited.--

 7         (4)  A provider or any representative of a provider,

 8  regardless of whether the provider is under contract with the

 9  health maintenance organization, may not collect or attempt to

10  collect money from, maintain any action at law against, or

11  report to a credit agency a subscriber of an organization for

12  payment of services for which the organization is liable, if

13  the provider in good faith knows or should know that the

14  organization is liable. This prohibition applies during the

15  pendency of any claim for payment made by the provider to the

16  organization for payment of the services and any legal

17  proceedings or dispute resolution process to determine whether

18  the organization is liable for the services if the provider is

19  informed that such proceedings are taking place. It is

20  presumed that a provider does not know and should not know

21  that an organization is liable unless:

22         (c)  The office or agency makes a final determination

23  that the organization is required to pay for such services

24  subsequent to a recommendation made by the Statewide Provider

25  and Subscriber Assistance Panel pursuant to s. 408.7056; or

26         Section 13.  Subsection (1), paragraphs (b) and (e) of

27  subsection (3), paragraph (d) of subsection (4), subsection

28  (5), paragraph (g) of subsection (6), and subsections (9),

29  (10), and (11) of section 641.511, Florida Statutes, are

30  amended to read:

31  

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 1         641.511  Subscriber grievance reporting and resolution

 2  requirements.--

 3         (1)  Every organization must have a grievance procedure

 4  available to its subscribers for the purpose of addressing

 5  complaints and grievances. Every organization must notify its

 6  subscribers that a subscriber must submit a grievance within 1

 7  year after the date of occurrence of the action that initiated

 8  the grievance, and may submit the grievance for review to the

 9  Statewide Provider and Subscriber Assistance Program panel as

10  provided in s. 408.7056 after receiving a final disposition of

11  the grievance through the organization's grievance process. An

12  organization shall maintain records of all grievances and

13  shall report annually to the agency the total number of

14  grievances handled, a categorization of the cases underlying

15  the grievances, and the final disposition of the grievances.

16         (3)  Each organization's grievance procedure, as

17  required under subsection (1), must include, at a minimum:

18         (b)  The names of the appropriate employees or a list

19  of grievance departments that are responsible for implementing

20  the organization's grievance procedure. The list must include

21  the address and the toll-free telephone number of each

22  grievance department, the address of the agency and its

23  toll-free telephone hotline number, and the address of the

24  Statewide Provider and Subscriber Assistance Program and its

25  toll-free telephone number.

26         (e)  A notice that a subscriber may voluntarily pursue

27  binding arbitration in accordance with the terms of the

28  contract if offered by the organization, after completing the

29  organization's grievance procedure and as an alternative to

30  the Statewide Provider and Subscriber Assistance Program. Such

31  notice shall include an explanation that the subscriber may

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 1  incur some costs if the subscriber pursues binding

 2  arbitration, depending upon the terms of the subscriber's

 3  contract.

 4         (4)

 5         (d)  In any case when the review process does not

 6  resolve a difference of opinion between the organization and

 7  the subscriber or the provider acting on behalf of the

 8  subscriber, the subscriber or the provider acting on behalf of

 9  the subscriber may submit a written grievance to the Statewide

10  Provider and Subscriber Assistance Program.

11         (5)  Except as provided in subsection (6), the

12  organization shall resolve a grievance within 60 days after

13  receipt of the grievance, or within a maximum of 90 days if

14  the grievance involves the collection of information outside

15  the service area. These time limitations are tolled if the

16  organization has notified the subscriber, in writing, that

17  additional information is required for proper review of the

18  grievance and that such time limitations are tolled until such

19  information is provided. After the organization receives the

20  requested information, the time allowed for completion of the

21  grievance process resumes. The Employee Retirement Income

22  Security Act of 1974, as implemented by 29 C.F.R. 2560.503-1,

23  is adopted and incorporated by reference as applicable to all

24  organizations that administer small and large group health

25  plans that are subject to 29 C.F.R. 2560.503-1. The claims

26  procedures of the regulations of the Employee Retirement

27  Income Security Act of 1974 as implemented by 29 C.F.R.

28  2560.503-1 shall be the minimum standards for grievance

29  processes for claims for benefits for small and large group

30  health plans that are subject to 29 C.F.R. 2560.503-1.

31         (6)

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 1         (g)  In any case when the expedited review process does

 2  not resolve a difference of opinion between the organization

 3  and the subscriber or the provider acting on behalf of the

 4  subscriber, the subscriber or the provider acting on behalf of

 5  the subscriber may submit a written grievance to the Statewide

 6  Provider and Subscriber Assistance Program.

 7         (9)(a)  The agency shall advise subscribers with

 8  grievances to follow their organization's formal grievance

 9  process for resolution prior to review by the Statewide

10  Provider and Subscriber Assistance Program. The subscriber

11  may, however, submit a copy of the grievance to the agency at

12  any time during the process.

13         (b)  Requiring completion of the organization's

14  grievance process before the Statewide Provider and Subscriber

15  Assistance Program panel's review does not preclude the agency

16  from investigating any complaint or grievance before the

17  organization makes its final determination.

18         (10)  Each organization must notify the subscriber in a

19  final decision letter that the subscriber may request review

20  of the organization's decision concerning the grievance by the

21  Statewide Provider and Subscriber Assistance Program, as

22  provided in s. 408.7056, if the grievance is not resolved to

23  the satisfaction of the subscriber. The final decision letter

24  must inform the subscriber that the request for review must be

25  made within 365 days after receipt of the final decision

26  letter, must explain how to initiate such a review, and must

27  include the addresses and toll-free telephone numbers of the

28  agency and the Statewide Provider and Subscriber Assistance

29  Program.

30         (11)  Each organization, as part of its contract with

31  any provider, must require the provider to post a consumer

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 1  assistance notice prominently displayed in the reception area

 2  of the provider and clearly noticeable by all patients. The

 3  consumer assistance notice must state the addresses and

 4  toll-free telephone numbers of the Agency for Health Care

 5  Administration, the Statewide Provider and Subscriber

 6  Assistance Program, and the Department of Financial Services.

 7  The consumer assistance notice must also clearly state that

 8  the address and toll-free telephone number of the

 9  organization's grievance department shall be provided upon

10  request. The agency may adopt rules to implement this section.

11         Section 14.  Subsection (4) of section 641.58, Florida

12  Statutes, is amended to read:

13         641.58  Regulatory assessment; levy and amount; use of

14  funds; tax returns; penalty for failure to pay.--

15         (4)  The moneys received and deposited into the Health

16  Care Trust Fund shall be used to defray the expenses of the

17  agency in the discharge of its administrative and regulatory

18  powers and duties under this part, including conducting an

19  annual survey of the satisfaction of members of health

20  maintenance organizations; contracting with physician

21  consultants for the Statewide Provider and Subscriber

22  Assistance Panel; maintaining offices and necessary supplies,

23  essential equipment, and other materials, salaries and

24  expenses of required personnel; and discharging the

25  administrative and regulatory powers and duties imposed under

26  this part.

27         Section 15.  Paragraph (f) of subsection (2) and

28  subsections (3) and (9) of section 408.909, Florida Statutes,

29  are amended to read:

30         408.909  Health flex plans.--

31         (2)  DEFINITIONS.--As used in this section, the term:

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 1         (f)  "Health flex plan entity" means a health insurer,

 2  health maintenance organization,

 3  health-care-provider-sponsored organization, local government,

 4  health care district, or other public or private

 5  community-based organization, or public-private partnership

 6  that develops and implements an approved health flex plan and

 7  is responsible for administering the health flex plan and

 8  paying all claims for health flex plan coverage by enrollees

 9  of the health flex plan.

10         (3)  PILOT PROGRAM.--The agency and the office shall

11  each approve or disapprove health flex plans that provide

12  health care coverage for eligible participants who reside in

13  the three areas of the state that have the highest number of

14  uninsured persons, as identified in the Florida Health

15  Insurance Study conducted by the agency and in Indian River

16  County . A health flex plan may limit or exclude benefits

17  otherwise required by law for insurers offering coverage in

18  this state, may cap the total amount of claims paid per year

19  per enrollee, may limit the number of enrollees, or may take

20  any combination of those actions. A health flex plan offering

21  may include the option of a catastrophic plan supplementing

22  the health flex plan.

23         (a)  The agency shall develop guidelines for the review

24  of applications for health flex plans and shall disapprove or

25  withdraw approval of plans that do not meet or no longer meet

26  minimum standards for quality of care and access to care. The

27  agency shall ensure that the health flex plans follow

28  standardized grievance procedures similar to those required of

29  health maintenance organizations.

30         (b)  The office shall develop guidelines for the review

31  of health flex plan applications and provide regulatory

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 1  oversight of health flex plan advertisement and marketing

 2  procedures. The office shall disapprove or shall withdraw

 3  approval of plans that:

 4         1.  Contain any ambiguous, inconsistent, or misleading

 5  provisions or any exceptions or conditions that deceptively

 6  affect or limit the benefits purported to be assumed in the

 7  general coverage provided by the health flex plan;

 8         2.  Provide benefits that are unreasonable in relation

 9  to the premium charged or contain provisions that are unfair

10  or inequitable or contrary to the public policy of this state,

11  that encourage misrepresentation, or that result in unfair

12  discrimination in sales practices; or

13         3.  Cannot demonstrate that the health flex plan is

14  financially sound and that the applicant is able to underwrite

15  or finance the health care coverage provided.

16         (c)  The agency and the Financial Services Commission

17  may adopt rules as needed to administer this section.

18         (9)  PROGRAM EVALUATION.--The agency and the office

19  shall evaluate the pilot program and its effect on the

20  entities that seek approval as health flex plans, on the

21  number of enrollees, and on the scope of the health care

22  coverage offered under a health flex plan; shall provide an

23  assessment of the health flex plans and their potential

24  applicability in other settings; shall use health flex plans

25  to gather more information to evaluate low-income consumer

26  driven benefit packages; and shall, by January 1, 2005 2004,

27  jointly submit a report to the Governor, the President of the

28  Senate, and the Speaker of the House of Representatives.

29         Section 16.  Section 381.0271, Florida Statutes, is

30  created to read:

31         381.0271  Florida Patient Safety Corporation.--

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 1         (1)  DEFINITIONS.--As used in this section, the term:

 2         (a)  "Adverse incident" has the same meanings as

 3  provided in ss. 395.0197, 458.351, and 459.026.

 4         (b)  "Corporation" means the Florida Patient Safety

 5  Corporation created in this section.

 6         (c)  "Patient safety data" has the same meaning as

 7  provided in s. 766.1016.

 8         (2)  CREATION.--

 9         (a)  There is created a not-for-profit corporation to

10  be known as the Florida Patient Safety Corporation, which

11  shall be registered, incorporated, organized, and operated in

12  compliance with chapter 617. Upon the prior approval of the

13  board of directors, the corporation may create not-for-profit

14  corporate subsidiaries, organized under the provisions of

15  chapter 617, as necessary to fulfill the mission of the

16  corporation.

17         (b)  The corporation or any authorized and approved

18  subsidiary is not an agency within the meaning of s.

19  20.03(11).

20         (c)  The corporation and its authorized and approved

21  subsidiaries are subject to the public meetings and records

22  requirements of s. 24, Art I of the State Constitution,

23  chapter 119, and s. 286.011.

24         (d)  The corporation and its authorized and approved

25  subsidiaries are not subject to the provisions of chapter 287.

26         (e)  The corporation is a patient safety organization

27  for purposes of s. 766.1016.

28         (3)  PURPOSE.--

29         (a)  The purpose of the Florida Patient Safety

30  Corporation is to serve as a learning organization dedicated

31  to assisting health care providers in the state to improve the

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 1  quality and safety of health care rendered and to reduce harm

 2  to patients. The corporation shall promote the development of

 3  a culture of patient safety in the health care system in the

 4  state. The corporation may not regulate health care providers

 5  in this state.

 6         (b)  In the fulfillment of its purpose, the corporation

 7  shall work with a consortium of patient safety centers and

 8  other patient safety programs within the universities in this

 9  state.

10         (4)  BOARD OF DIRECTORS; MEMBERSHIP.--The corporation

11  shall be governed by a board of directors. The board of

12  directors shall consist of:

13         (a)  The chairperson of the Council of Medical School

14  Deans.

15         (b)  The person responsible for patient safety issues

16  for the authorized health insurer with the largest market

17  share as measured by premiums written in the state for the

18  most recent calendar year, appointed by such insurer.

19         (c)  A representative of the authorized medical

20  malpractice insurer with the largest market share as measured

21  by premiums written in the state for the most recent calendar

22  year, appointed by such insurer.

23         (d)  The president of the Florida Health Care

24  Coalition.

25         (e)  A representative of a hospital in the state that

26  is implementing innovative patient safety initiatives,

27  appointed by the Florida Hospital Association.

28         (f)  A physician with expertise in patient safety,

29  appointed by the Florida Medical Association.

30         (g)  A physician with expertise in patient safety,

31  appointed by the Florida Osteopathic Medical Association.

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 1         (h)  A nurse with expertise in patient safety,

 2  appointed by the Florida Nurses Association.

 3         (i)  An institutional pharmacist, appointed by the

 4  Florida Society of Health System Pharmacists, Inc.

 5         (j)  A representative of Florida AARP, appointed by the

 6  state director of the Florida AARP.

 7         (k)  An independent consultant on health care

 8  information systems, appointed jointly by the Central Florida

 9  Chapter and the South Florida Chapter of the Healthcare

10  Information and Management Systems Society.

11         (5)  ADVISORY COMMITTEES.--In addition to any

12  committees that the corporation may establish, the corporation

13  shall establish the following advisory committees:

14         (a)  A scientific research advisory committee that

15  includes, at a minimum, a representative from each patient

16  safety center or other patient safety program in the

17  universities of this state, who are licensed physicians under

18  ch. 458 or 459, F.S., with experience in patient safety and

19  evidence based medicine.

20         (b)  A technology advisory committee that includes, at

21  a minimum, a representative of a hospital that has implemented

22  a computerized physician order entry system and a health care

23  provider that has implemented an electronic medical records

24  system.

25         (c)  A health care provider advisory committee that

26  includes, at a minimum, representatives of hospitals,

27  ambulatory surgical centers, physicians, nurses, and

28  pharmacists licensed in this state and a representative of the

29  Veterans Integrated Service Network 8 VA Patient Safety

30  Center.

31  

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 1         (d)  A health care consumer advisory committee that

 2  includes, at a minimum, representatives of businesses that

 3  provide health insurance coverage to their employees, consumer

 4  advocacy groups, and representatives of patient organizations.

 5         (e)  A state agency advisory committee that includes,

 6  at a minimum, a representative from each state agency that has

 7  regulatory responsibilities related to patient safety.

 8         (f)  A litigation alternatives advisory committee that

 9  includes, at a minimum, representatives of attorneys who

10  represent plaintiffs and defendants in medical malpractice

11  cases and a representative of each law school in the state.

12         (g)  An education advisory committee that includes, at

13  a minimum, the associate dean for education, or the equivalent

14  position, as a representative from each school of medicine,

15  nursing, public health, or allied health to provide advice on

16  the development, implementation, and measurement of core

17  competencies for patient safety to be considered for

18  incorporation in the educational programs of the universities

19  of this state.

20         (6)  ORGANIZATION; MEETINGS.--

21         (a)  The Agency for Health Care Administration shall

22  assist the corporation in its organizational activities

23  required under chapter 617, including, but not limited to:

24         1.  Eliciting appointments for the initial board of

25  directors.

26         2.  Convening the first meeting of the board of

27  directors and assisting with other meetings of the board of

28  directors, upon the request of the board of directors, during

29  the first year of operation of the corporation.

30         3.  Drafting articles of incorporation for the board of

31  directors and, upon the request of the board of directors,

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 1  delivering articles of incorporation to the Department of

 2  State for filing.

 3         4.  Drafting proposed bylaws for the corporation.

 4         5.  Paying fees related to incorporation.

 5         6.  Providing office space and administrative support,

 6  at the request of the board of directors, but not beyond July

 7  1, 2005.

 8         (b)  The board of directors must conduct its first

 9  meeting no later than August 1, 2004, and shall meet

10  thereafter as frequently as necessary to carry out the duties

11  of the corporation.

12         (7)  POWERS AND DUTIES.--In addition to the powers and

13  duties prescribed in chapter 617 and the articles and bylaws

14  adopted under that chapter, the corporation shall directly or

15  through contract:

16         (a)  Secure staff necessary to properly administer the

17  corporation.

18         (b)  Collect, analyze, and evaluate patient safety

19  data, quality and patient safety indicators, medical

20  malpractice closed claims, and adverse incidents reported to

21  the Agency for Health Care Administration and the Department

22  of Health for the purpose of recommending changes in practices

23  and procedures which may be implemented by health care

24  practitioners and health care facilities to improve the

25  quality of health care and to prevent future adverse

26  incidents. Notwithstanding any other law, the Agency for

27  Health Care Administration and the Department of Health shall

28  make available to the corporation any adverse incident report

29  submitted under s. 395.0197, s. 458.351, or s. 459.026. To the

30  extent that adverse incident reports submitted under s.

31  395.0197 are confidential and exempt from disclosure, the

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 1  confidential and exempt status of such reports must be

 2  maintained by the corporation.

 3         (c)  Maintain an active library of best practices

 4  relating to patient safety and patient safety literature,

 5  along with the emerging evidence supporting the retention or

 6  modification of such practices, and make this information

 7  available to health care practitioners, health care

 8  facilities, and the public.

 9         (d)  Assess the patient safety culture at volunteering

10  hospitals and recommend methods to improve the working

11  environment related to patient safety at these hospitals.

12         (e)  Inventory the information technology capabilities

13  related to patient safety of health care facilities and health

14  care practitioners and recommend a plan for expediting

15  implementation of safety technologies statewide.

16         (f)  Facilitate the development of core competencies

17  relevant to patient safety which can be made available to be

18  considered for incorporation into the undergraduate and

19  graduate curriculums in schools of medicine, nursing, and

20  allied health in this state.

21         (g)  Facilitate continuing professional education

22  regarding patient safety for practicing health care

23  practitioners.

24         (h)  Study and facilitate the testing of alternative

25  systems of encouraging the implementation of effective risk

26  management strategies and clinical best practices, and of

27  compensating injured patients as a means of reducing and

28  preventing medical errors and promoting patient safety.

29         (i)  Develop programs to educate the public about the

30  role of health care consumers in promoting patient safety.

31  

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 1         (j)  Provide interagency coordination of patient safety

 2  efforts in this state.

 3         (k)  Conduct other activities identified by the board

 4  of directors to promote patient safety in this state.

 5         (8)  ANNUAL REPORT.--By December 1, 2004, the

 6  corporation shall prepare a report on the start-up activities

 7  of the corporation and any proposals for legislative action

 8  needed to enable the corporation to fulfill its purposes under

 9  this section. By December 1 of each year thereafter, the

10  corporation shall prepare a report for the preceding fiscal

11  year. The report, at a minimum, must include:

12         (a)  A description of the activities of the corporation

13  under this section.

14         (b)  Progress made in improving patient safety and

15  reducing medical errors.

16         (c)  A compliance and financial audit of the accounts

17  and records of the corporation at the end of the preceding

18  fiscal year conducted by an independent certified public

19  accountant.

20         (d)  An assessment of the ability of the corporation to

21  fulfill the duties specified in subsection (7) and the

22  appropriateness of those duties for the corporation.

23         (e)  Recommendations for legislative action needed to

24  improve patient safety in this state.

25  

26  The corporation shall submit the report to the Governor, the

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

28  Representatives.

29         (9)  PERFORMANCE EXPECTATIONS.--The Office of Program

30  Policy Analysis and Government Accountability, in consultation

31  with the Agency for Health Care Administration, the Department

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 1  of Health, and the corporation, shall develop performance

 2  standards by which to measure the success of the corporation

 3  in organizing to fulfill and beginning to implement the

 4  purposes and duties established in this section. The Office of

 5  Program Policy Analysis and Government Accountability shall

 6  conduct a performance audit of the corporation during 2006,

 7  using the performance standards, and shall submit a report to

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

 9  the House of Representatives by January 1, 2007.

10         Section 17.  The Patient Safety Center at the Florida

11  State University College of Medicine, in collaboration with

12  researchers at other state universities, shall conduct a study

13  to analyze the return on investment that hospitals in this

14  state could realize from implementing computerized physician

15  order entry and other information technologies related to

16  patient safety. For the purposes of this analysis, the return

17  on investment shall include both financial results and

18  benefits relating to quality of care and patient safety. The

19  study must include a representative sample of large and small

20  hospitals, located in urban and rural areas, in the north,

21  central, and southern regions of the state. By February 1,

22  2005, the Patient Safety Center at the Florida State

23  University College of Medicine must submit a report to the

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

25  House of Representatives concerning the results of the study.

26         Section 18.  Section 395.1012, Florida Statutes, is

27  amended to read:

28         395.1012  Patient safety.--

29         (1)  Each licensed facility must adopt a patient safety

30  plan. A plan adopted to implement the requirements of 42

31  

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 1  C.F.R. part 482.21 shall be deemed to comply with this

 2  requirement.

 3         (2)  Each licensed facility shall appoint a patient

 4  safety officer and a patient safety committee, which shall

 5  include at least one person who is neither employed by nor

 6  practicing in the facility, for the purpose of promoting the

 7  health and safety of patients, reviewing and evaluating the

 8  quality of patient safety measures used by the facility,

 9  recommending improvements in the patient safety measures used

10  by the facility, and assisting in the implementation of the

11  facility patient safety plan.

12         (3)  Each licensed facility shall adopt a plan to

13  reduce medication errors and adverse drug events, which must

14  consider the use of computerized physician order entry and

15  other information technologies related to patient safety.

16         Section 19.  Subsection (3) of section 409.91255,

17  Florida Statutes, is amended to read:

18         409.91255  Federally qualified health center access

19  program.--

20         (3)  ASSISTANCE TO FEDERALLY QUALIFIED HEALTH

21  CENTERS.--The Department of Health shall develop a program for

22  the expansion of federally qualified health centers for the

23  purpose of providing comprehensive primary and preventive

24  health care and urgent care services, including services that

25  may reduce the morbidity, mortality, and cost of care among

26  the uninsured population of the state. The program shall

27  provide for distribution of financial assistance to federally

28  qualified health centers that apply and demonstrate a need for

29  such assistance in order to sustain or expand the delivery of

30  primary and preventive health care services. In selecting

31  centers to receive this financial assistance, the program:

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 1         (a)  Shall give preference to communities that have few

 2  or no community-based primary care services or in which the

 3  current services are unable to meet the community's needs.

 4         (b)  Shall require that primary care services be

 5  provided to the medically indigent using a sliding fee

 6  schedule based on income.

 7         (c)  Shall allow innovative and creative uses of

 8  federal, state, and local health care resources.

 9         (d)  Shall require that the funds provided be used to

10  pay for operating costs of a projected expansion in patient

11  caseloads or services or for capital improvement projects.

12  Capital improvement projects may include renovations to

13  existing facilities or construction of new facilities,

14  provided that an expansion in patient caseloads or services to

15  a new patient population will occur as a result of the capital

16  expenditures. The department shall include in its standard

17  contract document a requirement that any state funds provided

18  for the purchase of or improvements to real property are

19  contingent upon the contractor granting to the state a

20  security interest in the property at least to the amount of

21  the state funds provided for at least 5 years from the date of

22  purchase or the completion of the improvements or as further

23  required by law. The contract must include a provision that,

24  as a condition of receipt of state funding for this purpose,

25  the contractor agrees that, if it disposes of the property

26  before the department's interest is vacated, the contractor

27  will refund the proportionate share of the state's initial

28  investment, as adjusted by depreciation.

29         (e)  May require in-kind support from other sources.

30  

31  

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 1         (f)  May encourage coordination among federally

 2  qualified health centers, other private-sector providers, and

 3  publicly supported programs.

 4         (g)  Shall allow the development of community emergency

 5  room diversion programs in conjunction with local resources,

 6  providing extended hours of operation to urgent care patients.

 7  Diversion programs shall include case management for emergency

 8  room followup care.

 9         Section 20.  Paragraph (a) of subsection (6) of section

10  627.410, Florida Statutes, is amended to read:

11         627.410  Filing, approval of forms.--

12         (6)(a)  An insurer shall not deliver or issue for

13  delivery or renew in this state any health insurance policy

14  form until it has filed with the office a copy of every

15  applicable rating manual, rating schedule, change in rating

16  manual, and change in rating schedule; if rating manuals and

17  rating schedules are not applicable, the insurer must file

18  with the office order applicable premium rates and any change

19  in applicable premium rates. This paragraph does not apply to

20  group health insurance policies, effectuated and delivered in

21  this state, insuring groups of 26 51 or more persons, except

22  for Medicare supplement insurance, long-term care insurance,

23  and any coverage under which the increase in claim costs over

24  the lifetime of the contract due to advancing age or duration

25  is prefunded in the premium.

26         Section 21.  Section 624.6405, Florida Statutes, is

27  created to read:

28         624.6405  Decrease in inappropriate utilization of

29  emergency care.--

30         (1)  The Legislature finds and declares it to be of

31  vital importance that emergency services and care be provided

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 1  by hospitals and physicians to every person in need of such

 2  care, but with the double-digit increases in health insurance

 3  premiums, health care providers and insurers should encourage

 4  patients and the insured to assume responsibility for their

 5  treatment, including emergency care. The Legislature finds

 6  that inappropriate utilization of emergency department

 7  services increases the overall cost of providing health care

 8  and these costs are ultimately borne by the hospital, the

 9  insured patients, and, many times, by the taxpayers of this

10  state. Finally, the Legislature declares that the providers

11  and insurers must share the responsibility of providing

12  alternative treatment options to urgent care patients outside

13  of the emergency department. Therefore, it is the intent of

14  the Legislature to place the obligation for educating

15  consumers and creating mechanisms for delivery of care that

16  will decrease the overutilization of emergency service on

17  health insurers and providers.

18         (2)  Health insurers shall provide on their websites

19  information regarding appropriate utilization of emergency

20  care services which shall include, but not be limited to, a

21  list of alternative urgent care contracted providers, the

22  types of services offered by these providers, and what to do

23  in the event of a true emergency.

24         (3)  Health insurers shall develop community emergency

25  department diversion programs. Such programs may include, but

26  not be limited to, enlisting providers to be on call to

27  insurers after hours, coordinating care through local

28  community resources, and incentives to providers for case

29  management.

30         (4)  As a disincentive for insureds to inappropriately

31  use emergency department services, health insurers may require

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 1  higher copayments for nonemergency use of emergency

 2  departments and higher copayments for use of out-of-network

 3  emergency departments. For the purposes of this section, the

 4  term "emergency care" has the same meaning as provided in s.

 5  395.002, and shall include services provided to rule out an

 6  emergency medical condition.

 7         Section 22.  Paragraph (b) of subsection (3) of section

 8  627.6487, Florida Statutes, is amended to read:

 9         627.6487  Guaranteed availability of individual health

10  insurance coverage to eligible individuals.--

11         (3)  For the purposes of this section, the term

12  "eligible individual" means an individual:

13         (b)  Who is not eligible for coverage under:

14         1.  A group health plan, as defined in s. 2791 of the

15  Public Health Service Act;

16         2.  A conversion policy or contract issued by an

17  authorized insurer or health maintenance organization under s.

18  627.6675 or s. 641.3921, respectively, offered to an

19  individual who is no longer eligible for coverage under either

20  an insured or self-insured employer plan;

21         3.  Part A or part B of Title XVIII of the Social

22  Security Act; or

23         4.  A state plan under Title XIX of such act, or any

24  successor program, and does not have other health insurance

25  coverage; or

26         5.  The Florida Health Insurance Plan as specified in

27  s. 627.64872 and such plan is accepting new enrollment;

28         Section 23.  Effective upon this act becoming a law,

29  section 627.64872, Florida Statutes, is created to read:

30         627.64872  Florida Health Insurance Plan.--

31  

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 1         (1)  LEGISLATIVE INTENT; FLORIDA HEALTH INSURANCE

 2  PLAN.--

 3         (a)  The Legislature recognizes that to secure a more

 4  stable and orderly health insurance market, the establishment

 5  of a plan to assume risks deemed uninsurable by the private

 6  marketplace is required.

 7         (b)  The Florida Health Insurance Plan is created to

 8  make coverage available to individuals who have no other

 9  option for similar coverage, at a premium that is commensurate

10  with the risk and benefits provided, and with benefit designs

11  that are reasonable in relation to the general market. While

12  plan operations may include supplementary funding, the plan

13  shall fundamentally operate on sound actuarial principles,

14  using basic insurance management techniques to ensure that the

15  plan is run in an economical, cost-efficient, and sound

16  manner, conserving plan resources to serve the maximum number

17  of people possible in a sustainable fashion.

18         (2)  DEFINITIONS.--As used in this section:

19         (a)  "Board" means the board of directors of the plan.

20         (b)  "Commission" means the Financial Services

21  Commission.

22         (c)  "Dependent" means a resident spouse or resident

23  unmarried child under the age of 19 years, a child who is a

24  student under the age of 25 years and who is financially

25  dependent upon the parent, or a child of any age who is

26  disabled and dependent upon the parent.

27         (d)  "Director" means the director of the Office of

28  Insurance Regulation.

29         (e)  "Health insurance" means any hospital or medical

30  expense incurred policy pursuant to this chapter or health

31  maintenance organization subscriber contract pursuant to

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 1  chapter 641. The term does not include short term, accident,

 2  dental-only, vision-only, fixed indemnity, limited benefit,

 3  credit, or disability income insurance; coverage for onsite

 4  medical clinics; insurance coverage specified in federal

 5  regulations issued pursuant to Pub. L. No. 104-191, under

 6  which benefits for medical care are secondary or incidental to

 7  other insurance benefits; benefits for long-term care, nursing

 8  home care, home health care, community-based care, or any

 9  combination thereof, or other similar, limited benefits

10  specified in federal regulations issued pursuant to Pub. L.

11  No. 104-191; benefits provided under a separate policy,

12  certificate, or contract of insurance where there is no

13  coordination between the provision of the benefits and any

14  exclusion of benefits under any group health plan maintained

15  by the same plan sponsor, and the benefits are paid with

16  respect to an event without regard to whether benefits are

17  provided with respect to such an event under any group health

18  plan maintained by the same plan sponsor, such as for coverage

19  only for a specified disease or illness; hospital indemnity or

20  other fixed indemnity insurance; coverage offered as a

21  separate policy, certificate, or contract of insurance, such

22  as Medicare supplemental health insurance as defined under s.

23  1882(g)(1) of the Social Security Act; coverage supplemental

24  to the coverage provided under Chapter 55 of Title 10, United

25  States Code (Civilian Health and Medical Program of the

26  Uniformed Services (CHAMPUS)); similar supplemental coverage

27  provided to coverage under a group health plan; coverage

28  issued as a supplement to liability insurance; insurance

29  arising out of a workers' compensation or similar law;

30  automobile medical-payment insurance; or insurance under which

31  benefits are payable with or without regard to fault and which

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 1  is statutorily required to be contained in any liability

 2  insurance policy or equivalent self-insurance.

 3         (f)  "Implementation" means the effective date on which

 4  the board is established.

 5         (g)  "Insurer" means any entity that provides health

 6  insurance in this state. For purposes of this section, insurer

 7  includes an insurance company with a valid certificate in

 8  accordance with chapter 624, a health maintenance organization

 9  with a valid certificate of authority in accordance with part

10  I or part III of chapter 641, a prepaid health clinic

11  authorized to transact business in this state pursuant to part

12  II of chapter 641, multiple employer welfare arrangements

13  authorized to transact business in this state pursuant to ss.

14  624.436-624.45, or a fraternal benefit society providing

15  health benefits to its members as authorized pursuant to

16  chapter 632.

17         (h)  "Medicare" means coverage under both Parts A and B

18  of Title XVIII of the Social Security Act, 42 USC 1395 et

19  seq., as amended.

20         (i)  "Medicaid" means coverage under Title XIX of the

21  Social Security Act.

22         (j)  "Office" means the Office of Insurance Regulation

23  of the Financial Services Commission.

24         (k)  "Participating insurer" means any insurer

25  providing health insurance to citizens of this state.

26         (l)  "Provider" means any physician, hospital, or other

27  institution, organization, or person that furnishes health

28  care services and is licensed or otherwise authorized to

29  practice in the state.

30         (m)  "Plan" means the Florida Health Insurance Plan

31  created in subsection (1).

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 1         (n)  "Plan of operation" means the articles, bylaws,

 2  and operating rules and procedures adopted by the board

 3  pursuant to this section.

 4         (o)  "Resident" means an individual who has been

 5  legally domiciled in this state for a period of at least 6

 6  months with exception of residents deemed eligible under the

 7  federal Health Insurance Portability and Accountability Act of

 8  1996.

 9         (3)  BOARD OF DIRECTORS.--

10         (a)  The plan shall operate subject to the supervision

11  and control of the board. The board shall consist of the

12  director or his or her designated representative, who shall

13  serve as a member of the board and shall be its chair, and an

14  additional eight members, five of whom shall be appointed by

15  the Governor, at least three of whom shall be individuals not

16  representative of insurers or health care providers, one of

17  whom shall be appointed by the Chief Financial Officer, one of

18  whom shall be appointed by the President of the Senate, and

19  one of whom shall be appointed by the Speaker of the House of

20  Representatives.

21         (b)  The initial board members shall be appointed as

22  follows: one-third of the members to serve a term of 2 years;

23  one-third of the members to serve a term of 4 years; and

24  one-third of the members to serve a term of 6 years.

25  Subsequent board members shall serve for a term of 3 years. A

26  board member's term shall continue until his or her successor

27  is appointed.

28         (c)  Vacancies in the board shall be filled by the

29  appointing authority, such authority being the Governor, the

30  Chief Financial Officer, the President of the Senate, or the

31  

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 1  Speaker of the House of Representatives. Board members may be

 2  removed by the appointing authority for cause.

 3         (d)  The board shall conduct its first meeting by

 4  September 1, 2004.

 5         (e)  Members shall not be compensated in their capacity

 6  as board members but shall be reimbursed for reasonable

 7  expenses incurred in the necessary performance of their duties

 8  in accordance with s. 112.061.

 9         (f)  The board shall submit to the commission a plan of

10  operation for the plan and any amendments thereto necessary or

11  suitable to ensure the fair, reasonable, and equitable

12  administration of the plan. The plan of operation shall ensure

13  that the plan qualifies to apply for any available funding

14  from the Federal Government that adds to the financial

15  viability of the plan. The plan of operation shall become

16  effective upon approval in writing by the commission

17  consistent with the date on which the coverage under this

18  section must be made available. If the board fails to submit a

19  suitable plan of operation within 1 year after the appointment

20  of the board of directors, or at any time thereafter fails to

21  submit suitable amendments to the plan of operation, the

22  commission shall adopt such rules as are necessary or

23  advisable to effectuate the provisions of this section. Such

24  rules shall continue in force until modified by the office or

25  superseded by a plan of operation submitted by the board and

26  approved by the commission.

27         (g)  The board shall take no action to implement the

28  plan, other than the completion of the actuarial study

29  authorized in subsection (6), until funds are appropriated for

30  start-up costs and any projected deficits.

31         (4)  PLAN OF OPERATION.--The plan of operation shall:

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 1         (a)  Establish procedures for operation of the plan.

 2         (b)  Establish procedures for selecting an

 3  administrator in accordance with subsection (11).

 4         (c)  Establish procedures to create a fund, under

 5  management of the board, for administrative expenses.

 6         (d)  Establish procedures for the handling, accounting,

 7  and auditing of assets, moneys, and claims of the plan and the

 8  plan administrator.

 9         (e)  Develop and implement a program to publicize the

10  existence of the plan, plan eligibility requirements, and

11  procedures for enrollment and maintain public awareness of the

12  plan.

13         (f)  Establish procedures under which applicants and

14  participants may have grievances reviewed by a grievance

15  committee appointed by the board. The grievances shall be

16  reported to the board after completion of the review, with the

17  committee's recommendation for grievance resolution. The board

18  shall retain all written grievances regarding the plan for at

19  least 3 years.

20         (g)  Provide for other matters as may be necessary and

21  proper for the execution of the board's powers, duties, and

22  obligations under this section.

23         (5)  POWERS OF THE PLAN.--The plan shall have the

24  general powers and authority granted under the laws of this

25  state to health insurers and, in addition thereto, the

26  specific authority to:

27         (a)  Enter into such contracts as are necessary or

28  proper to carry out the provisions and purposes of this

29  section, including the authority, with the approval of the

30  commission, to enter into contracts with similar plans of

31  other states for the joint performance of common

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 1  administrative functions, or with persons or other

 2  organizations for the performance of administrative functions.

 3         (b)  Take any legal actions necessary or proper to

 4  recover or collect assessments due the plan.

 5         (c)  Take such legal action as is necessary to:

 6         1.  Avoid payment of improper claims against the plan

 7  or the coverage provided by or through the plan;

 8         2.  Recover any amounts erroneously or improperly paid

 9  by the plan;

10         3.  Recover any amounts paid by the plan as a result of

11  mistake of fact or law; or

12         4.  Recover other amounts due the plan.

13         (d)  Establish, and modify as appropriate, rates, rate

14  schedules, rate adjustments, expense allowances, agents'

15  commissions, claims reserve formulas, and any other actuarial

16  functions appropriate to the operation of the plan. Rates and

17  rate schedules may be adjusted for appropriate factors such as

18  age, sex, and geographic variation in claim cost and shall

19  take into consideration appropriate factors in accordance with

20  established actuarial and underwriting practices. For purposes

21  of this paragraph, usual and customary agent's commissions

22  shall be paid for the initial placement of coverage with the

23  plan and for one renewal only.

24         (e)  Issue policies of insurance in accordance with the

25  requirements of this section.

26         (f)  Appoint appropriate legal, actuarial, investment,

27  and other committees as necessary to provide technical

28  assistance in the operation of the plan and develop and

29  educate its policyholders regarding health savings accounts,

30  policy and contract design, and any other function within the

31  authority of the plan.

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 1         (g)  Borrow money to effectuate the purposes of the

 2  plan. Any notes or other evidence of indebtedness of the plan

 3  not in default shall be legal investments for insurers and may

 4  be carried as admitted assets.

 5         (h)  Employ and fix the compensation of employees.

 6         (i)  Prepare and distribute certificate of eligibility

 7  forms and enrollment instruction forms to insurance producers

 8  and to the general public.

 9         (j)  Provide for reinsurance of risks incurred by the

10  plan.

11         (k)  Provide for and employ cost-containment measures

12  and requirements, including, but not limited to, preadmission

13  screening, second surgical opinion, concurrent utilization

14  review, and individual case management for the purpose of

15  making the plan more cost-effective.

16         (l)  Design, use, contract, or otherwise arrange for

17  the delivery of cost-effective health care services,

18  including, but not limited to, establishing or contracting

19  with preferred provider organizations, health maintenance

20  organizations, and other limited network provider

21  arrangements.

22         (m)  Adopt such bylaws, policies, and procedures as may

23  be necessary or convenient for the implementation of this

24  section and the operation of the plan.

25         (6)(a)  Interim report.--No later than December 1,

26  2004, the board shall submit to the Governor, the President of

27  the Senate, and the Speaker of the House of Representatives an

28  actuarial study to determine, including, but not limited to:

29         1.  The impact the creation of this plan will have on

30  the small group insurance market, specifically on the premiums

31  paid by insureds. This shall include an estimate of the total

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 1  anticipated aggregate savings for all small employers in the

 2  state.

 3         2.  The number of individuals the pool could reasonably

 4  cover at various funding levels.

 5         3.  A recommendation as to the best source of funding

 6  for the anticipated deficits of the pool.

 7         (b)  Annual report.--No later than December 1, 2005,

 8  and annually thereafter, the board shall submit to the

 9  Governor, the President of the Senate, the Speaker of the

10  House of Representatives, and the substantive legislative

11  committees of the Legislature a report which includes an

12  independent actuarial study to determine, including, but not

13  be limited to:

14         1.  The impact the creation of the plan has on the

15  small group and individual insurance market, specifically on

16  the premiums paid by insureds. This shall include an estimate

17  of the total anticipated aggregate savings for all small

18  employers in the state.

19         2.  The actual number of individuals covered at the

20  current funding and benefit level, the projected number of

21  individuals that may seek coverage in the forthcoming fiscal

22  year, and the projected funding needed to cover anticipated

23  increase or decrease in plan participation.

24         3.  A recommendation as to the best source of funding

25  for the anticipated deficits of the pool.

26         4.  A summarization of the activities of the plan in

27  the preceding calendar year, including the net written and

28  earned premiums, plan enrollment, the expense of

29  administration, and the paid and incurred losses.

30         5.  A review of the operation of the plan as to whether

31  the plan has met the intent of this section.

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 1         (7)  LIABILITY OF THE PLAN.--Neither the board nor its

 2  employees shall be liable for any obligations of the plan. No

 3  member or employee of the board shall be liable, and no cause

 4  of action of any nature may arise against a member or employee

 5  of the board, for any act or omission related to the

 6  performance of any powers and duties under this section,

 7  unless such act or omission constitutes willful or wanton

 8  misconduct. The board may provide in its bylaws or rules for

 9  indemnification of, and legal representation for, its members

10  and employees.

11         (8)  AUDITED FINANCIAL STATEMENT.--No later than June 1

12  following the close of each calendar year, the plan shall

13  submit to the Governor an audited financial statement prepared

14  in accordance with statutory accounting principles as adopted

15  by the National Association of Insurance Commissioners.

16         (9)  ELIGIBILITY.--

17         (a)  Any individual person who is and continues to be a

18  resident of this state shall be eligible for coverage under

19  the plan if:

20         1.  Evidence is provided that the person received at

21  least two notices of rejection or refusal to issue

22  substantially similar insurance for health reasons by one

23  insurer. A rejection or refusal by an insurer offering only

24  stoploss, excess of loss, or reinsurance coverage with respect

25  to the applicant shall not be sufficient evidence under this

26  paragraph; or

27         2.  The person is enrolled in the Florida Comprehensive

28  Health Association as of the date the plan is implemented.

29         (b)  Each resident dependent of a person who is

30  eligible for coverage under the plan shall also be eligible

31  for such coverage.

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 1         (c)  A person shall not be eligible for coverage under

 2  the plan if:

 3         1.  The person has or obtains health insurance coverage

 4  substantially similar to or more comprehensive than a plan

 5  policy, or would be eligible to obtain such coverage, unless a

 6  person may maintain other coverage for the period of time the

 7  person is satisfying any preexisting condition waiting period

 8  under a plan policy or may main tain plan coverage for the

 9  period of time the person is satisfying a preexisting

10  condition waiting period under another health insurance policy

11  intended to replace the plan policy;

12         2.  The person is determined to be eligible for health

13  care benefits under Medicaid, Medicare, the state's children's

14  health insurance program, or any other federal, state, or

15  local government program that provides health benefits;

16         3.  The person voluntarily terminated plan coverage

17  unless 12 months have elapsed since such termination;

18         4.  The person is an inmate or resident of a public

19  institution; or

20         5.  The person's premiums are paid for or reimbursed

21  under any government-sponsored program or by any government

22  agency or health care provider.

23         (d)  Coverage shall cease:

24         1.  On the date a person is no longer a resident of

25  this state;

26         2.  On the date a person requests coverage to end;

27         3.  Upon the death of the covered person;

28         4.  On the date state law requires cancellation or

29  nonrenewal of the policy;

30  

31  

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 1         5.  At the option of the plan, 30 days after the plan

 2  makes any inquiry concerning the person's eligibility or place

 3  of residence to which the person does not reply; or

 4         6.  Upon failure of the insured to pay for continued

 5  coverage.

 6         (e)  Except under the circumstances described in this

 7  subsection, coverage of a person who ceased to meet the

 8  eligibility requirements of this subsection shall be

 9  terminated at the end of the policy period for which the

10  necessary premiums have been paid.

11         (10)  UNFAIR REFERRAL TO PLAN.--It is an unfair trade

12  practice for the purposes of part IX of chapter 626 or s.

13  641.3901 for an insurer, health maintenance organization

14  insurance agent, insurance broker, or third-party

15  administrator to refer an individual employee to the plan, or

16  arrange for an individual employee to apply to the plan, for

17  the purpose of separating that employee from group health

18  insurance coverage provided in connection with the employee's

19  employment.

20         (11)  PLAN ADMINISTRATOR.--The board shall select

21  through a competitive bidding process a plan administrator to

22  administer the plan. The board shall evaluate bids submitted

23  based on criteria established by the board, which shall

24  include:

25         (a)  The plan administrator's proven ability to handle

26  health insurance coverage to individuals.

27         (b)  The efficiency and timeliness of the plan

28  administrator's claim processing procedures.

29         (c)  An estimate of total charges for administering the

30  plan.

31  

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 1         (d)  The plan administrator's ability to apply

 2  effective cost-containment programs and procedures and to

 3  administer the plan in a cost-efficient manner.

 4         (e)  The financial condition and stability of the plan

 5  administrator.

 6  

 7  The administrator shall be an insurer, a health maintenance

 8  organization, or a third-party administrator, or another

 9  organization duly authorized to provide insurance pursuant to

10  the Florida Insurance Code.

11         (12)  ADMINISTRATOR TERM LIMITS.--The plan

12  administrator shall serve for a period specified in the

13  contract between the plan and the plan administrator subject

14  to removal for cause and subject to any terms, conditions, and

15  limitations of the contract between the plan and the plan

16  administrator. At least 1 year prior to the expiration of each

17  period of service by a plan administrator, the board shall

18  invite eligible entities, including the current plan

19  administrator, to submit bids to serve as the plan

20  administrator. Selection of the plan administrator for each

21  succeeding period shall be made at least 6 months prior to the

22  end of the current period.

23         (13)  DUTIES OF THE PLAN ADMINISTRATOR.--

24         (a)  The plan administrator shall perform such

25  functions relating to the plan as may be assigned to it,

26  including, but not limited to:

27         1.  Determination of eligibility.

28         2.  Payment of claims.

29         3.  Establishment of a premium billing procedure for

30  collection of premiums from persons covered under the plan.

31  

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 1         4.  Other necessary functions to ensure timely payment

 2  of benefits to covered persons under the plan.

 3         (b)  The plan administrator shall submit regular

 4  reports to the board regarding the operation of the plan. The

 5  frequency, content, and form of the reports shall be specified

 6  in the contract between the board and the plan administrator.

 7         (c)  On March 1 following the close of each calendar

 8  year, the plan administrator shall determine net written and

 9  earned premiums, the expense of administration, and the paid

10  and incurred losses for the year and report this information

11  to the board and the Governor on a form prescribed by the

12  Governor.

13         (14)  PAYMENT OF THE PLAN ADMINISTRATOR.--The plan

14  administrator shall be paid as provided in the contract

15  between the plan and the plan administrator.

16         (15)  FUNDING OF THE PLAN.--

17         (a)  Premiums.--

18         1.  The plan shall establish premium rates for plan

19  coverage as provided in this section. Separate schedules of

20  premium rates based on age, sex, and geographical location may

21  apply for individual risks. Premium rates and schedules shall

22  be submitted to the office for approval prior to use.

23         2.  Initial rates for plan coverage shall be limited to

24  200 percent of rates established as applicable for individual

25  standard risks as specified in s. 627.6675(3)(c). Subject to

26  the limits provided in this paragraph, subsequent rates shall

27  be established to provide fully for the expected costs of

28  claims, including recovery of prior losses, expenses of

29  operation, investment income of claim reserves, and any other

30  cost factors subject to the limitations described herein, but

31  in no event shall premiums exceed the 200-percent rate

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 1  limitation provided in this section. Notwithstanding the

 2  200-percent rate limitation, sliding scale premium surcharges

 3  based upon the insured's income may apply to all enrollees

 4  except those obtaining coverage in accordance with s.

 5  627.6487, provided that such premiums do not exceed 300

 6  percent of the standard risk rate.

 7         (b)  Sources of additional revenue.--Any deficit

 8  incurred by the plan shall be primarily funded through amounts

 9  appropriated by the Legislature from general revenue sources,

10  including, but not limited to, a portion of the annual growth

11  in existing net insurance premium taxes. The board shall

12  operate the plan in such a manner that the estimated cost of

13  providing health insurance during any fiscal year will not

14  exceed total income the plan expects to receive from policy

15  premiums and funds appropriated by the Legislature, including

16  any interest on investments. After determining the amount of

17  funds appropriated to the board for a fiscal year, the board

18  shall estimate the number of new policies it believes the plan

19  has the financial capacity to insure during that year so that

20  costs do not exceed income. The board shall take steps

21  necessary to ensure that plan enrollment does not exceed the

22  number of residents it has estimated it has the financial

23  capacity to insure.

24         (16)  BENEFITS.--

25         (a)  The benefits provided shall be the same as the

26  standard and basic plans for small employers as outlined in s.

27  627.6699. The board shall also establish an option of

28  alternative coverage such as catastrophic coverage that

29  includes a minimum level of primary care coverage and a high

30  deductible plan that meets the federal requirements of a

31  health savings account.

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 1         (b)  In establishing the plan coverage, the board shall

 2  take into consideration the levels of health insurance

 3  provided in the state and such medical economic factors as may

 4  be deemed appropriate and adopt benefit levels, deductibles,

 5  copayments, coinsurance factors, exclusions, and limitations

 6  determined to be generally reflective of and commensurate with

 7  health insurance provided through a representative number of

 8  large employers in the state.

 9         (c)  The board may adjust any deductibles and

10  coinsurance factors annually according to the medical

11  component of the Consumer Price Index.

12         (d)1.  Plan coverage shall exclude charges or expenses

13  incurred during the first 6 months following the effective

14  date of coverage for any condition for which medical advice,

15  care, or treatment was recommended or received for such

16  condition during the 6-month period immediately preceding the

17  effective date of coverage.

18         2.  Such preexisting condition exclusions shall be

19  waived to the extent that similar exclusions, if any, have

20  been satisfied under any prior health insurance coverage which

21  was involuntarily terminated, provided application for pool

22  coverage is made not later than 63 days following such

23  involuntary termination. In such case, coverage under the plan

24  shall be effective from the date on which such prior coverage

25  was terminated and the applicant is not eligible for

26  continuation or conversion rights that would provide coverage

27  substantially similar to plan coverage.

28         (17)  NONDUPLICATION OF BENEFITS.--

29         (a)  The plan shall be payor of last resort of benefits

30  whenever any other benefit or source of third-party payment is

31  available. Benefits otherwise payable under plan coverage

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 1  shall be reduced by all amounts paid or payable through any

 2  other health insurance, by all hospital and medical expense

 3  benefits paid or payable under any workers' compensation

 4  coverage, automobile medical payment, or liability insurance,

 5  whether provided on the basis of fault or nonfault, and by any

 6  hospital or medical benefits paid or payable under or provided

 7  pursuant to any state or federal law or program.

 8         (b)  The plan shall have a cause of action against an

 9  eligible person for the recovery of the amount of benefits

10  paid that are not for covered expenses. Benefits due from the

11  plan may be reduced or refused as a setoff against any amount

12  recoverable under this paragraph.

13         (18)  ANNUAL AND MAXIMUM BENEFITS.--Maximum benefits

14  under the plan shall be determined by the board.

15         (19)  TAXATION.--The plan is exempt from any tax

16  imposed by this state. The plan shall apply for federal tax

17  exemption status.

18         (20)  COMBINING MEMBERSHIP OF THE FLORIDA COMPREHENSIVE

19  HEALTH ASSOCIATION.--

20         (a)1. Upon implementation of the plan, the Florida

21  Comprehensive Health Association is abolished and all

22  high-risk individuals actively enrolled in the Florida

23  Comprehensive Health Association shall be enrolled in the plan

24  subject to its rules and requirements.

25         2.  Persons formerly enrolled in the Florida

26  Comprehensive Health Association are only eligible for the

27  benefits authorized under subsection (18). Maximum lifetime

28  benefits paid to an individual in the plan shall not exceed

29  the amount established under subsection (18), and benefits

30  previously paid for any individual by the Florida

31  

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 1  Comprehensive Health Association shall be used in determining

 2  the total lifetime benefits paid under the plan.

 3         3.  Except as otherwise provided in this section, the

 4  Florida Comprehensive Health Association shall operate under

 5  the existing plan of operation without modification until the

 6  adoption of the new plan of operation for the Florida Health

 7  Insurance Plan.

 8         (b)1.  As a condition of doing business in this state,

 9  an insurer shall pay an assessment to the board in the amount

10  prescribed by this paragraph. For operating losses incurred on

11  or after July 1, 2004, by persons previously enrolled in the

12  Florida Comprehensive Health Association, each insurer shall

13  annually be assessed by the board in the following calendar

14  year a portion of such incurred operating losses of the plan.

15  Such portion shall be determined by multiplying such operating

16  losses by a fraction, the numerator of which equals the

17  insurer's earned premium pertaining to direct writings of

18  health insurance in the state during the calendar year

19  proceeding that for which the assessment is levied, and the

20  denominator of which equals the total of all such premiums

21  earned by participating insurers in the state during such

22  calendar year.

23         2.  The total of all assessments under this paragraph

24  upon a participating insurer shall not exceed 1 percent of

25  such insurer's health insurance premium earned in this state

26  during the calendar year preceding the year for which the

27  assessments were levied.

28         3.  All rights, title, and interest in the assessment

29  funds collected under this paragraph shall vest in this state.

30  However, all of such funds and interest earned shall be used

31  by the plan to pay claims and administrative expenses.

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 1         (c)  If assessments and other receipts by the plan,

 2  board, or plan administrator exceed the actual losses and

 3  administrative expenses of the plan, the excess shall be held

 4  in interest and used by the board to offset future losses. As

 5  used in this subsection, the term "future losses" includes

 6  reserves for claims incurred but not reported.

 7         (d)  Each insurer's assessment shall be determined

 8  annually by the board or plan administrator based on annual

 9  statements and other reports deemed necessary by the board or

10  plan administrator and filed with the board or plan

11  administrator by the insurer. Any deficit incurred under the

12  plan by persons previously enrolled in the Florida

13  Comprehensive Health Association shall be recouped by the

14  assessments against participating insurers by the board or

15  plan administrator in the manner provided in paragraph (b),

16  and the insurers may recover the assessment in the normal

17  course of their respective businesses without time limitation.

18         (e)  If a person enrolled in the Florida Comprehensive

19  Health Association as of July 1, 2004, loses eligibility for

20  participation in the plan, such person shall not be included

21  in the calculation of incurred operational losses as described

22  in paragraph (b) if the person later regains eligibility for

23  participation in the plan.

24         (f)  After all persons enrolled in the Florida

25  Comprehensive Health Association as of July 1, 2004, are no

26  longer eligible for participation in the plan, the plan,

27  board, or plan administrator shall no longer be allowed to

28  assess insurers in this state for incurred losses as described

29  in paragraph (b).

30         Section 24.  Upon implementation, as defined in section

31  627.64872(2), Florida Statutes, and provided in section

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 1  627.64872(20), Florida Statutes, of the Florida Health Benefit

 2  Plan created under section 627.64872, Florida Statutes,

 3  sections 627.6488, 627.6489, 627.649, 627.6492, 627.6494,

 4  627.6496, and 627.6498, Florida Statutes, are repealed.

 5         Section 25.  Subsections (12) and (13) are added to

 6  section 627.662, Florida Statutes, to read:

 7         627.662  Other provisions applicable.--The following

 8  provisions apply to group health insurance, blanket health

 9  insurance, and franchise health insurance:

10         (12)  Section 627.6044, relating to the use of specific

11  methodology for payment of claims.

12         (13)  Section 627.6405, relating to inappropriate

13  utilization of emergency care.

14         Section 26.  Paragraphs (c) and (d) of subsection (5),

15  subsection (6), and subsection (12) of section 627.6699,

16  Florida Statutes, are amended, subsections (15) and (16) of

17  that section are renumbered as subsections (16) and (17),

18  respectively, present subsection (15) of that section is

19  amended, and new subsections (15) and (18) are added to that

20  section, to read:

21         627.6699  Employee Health Care Access Act.--

22         (5)  AVAILABILITY OF COVERAGE.--

23         (c)  Every small employer carrier must, as a condition

24  of transacting business in this state:

25         1.  Offer and issue all small employer health benefit

26  plans on a guaranteed-issue basis to every eligible small

27  employer, with 2 to 50 eligible employees, that elects to be

28  covered under such plan, agrees to make the required premium

29  payments, and satisfies the other provisions of the plan. A

30  rider for additional or increased benefits may be medically

31  underwritten and may only be added to the standard health

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 1  benefit plan. The increased rate charged for the additional or

 2  increased benefit must be rated in accordance with this

 3  section.

 4         2.  In the absence of enrollment availability in the

 5  Florida Health Insurance Plan, offer and issue basic and

 6  standard small employer health benefit plans on a

 7  guaranteed-issue basis, during a 31-day open enrollment period

 8  of August 1 through August 31 of each year, to every eligible

 9  small employer, with fewer than two eligible employees, which

10  small employer is not formed primarily for the purpose of

11  buying health insurance and which elects to be covered under

12  such plan, agrees to make the required premium payments, and

13  satisfies the other provisions of the plan. Coverage provided

14  under this subparagraph shall begin on October 1 of the same

15  year as the date of enrollment, unless the small employer

16  carrier and the small employer agree to a different date. A

17  rider for additional or increased benefits may be medically

18  underwritten and may only be added to the standard health

19  benefit plan. The increased rate charged for the additional or

20  increased benefit must be rated in accordance with this

21  section. For purposes of this subparagraph, a person, his or

22  her spouse, and his or her dependent children constitute a

23  single eligible employee if that person and spouse are

24  employed by the same small employer and either that person or

25  his or her spouse has a normal work week of less than 25

26  hours. Any right to an open enrollment of health benefit

27  coverage for groups of fewer than two employees, pursuant to

28  this section, shall remain in full force and effect in the

29  absence of the availability of new enrollment into the Florida

30  Health Insurance Plan.

31  

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 1         3.  This paragraph does not limit a carrier's ability

 2  to offer other health benefit plans to small employers if the

 3  standard and basic health benefit plans are offered and

 4  rejected.

 5         (d)  A small employer carrier must file with the

 6  office, in a format and manner prescribed by the committee, a

 7  standard health care plan, a high deductible plan that meets

 8  the federal requirements of a health savings account plan, and

 9  a basic health care plan to be used by the carrier.

10         (6)  RESTRICTIONS RELATING TO PREMIUM RATES.--

11         (a)  The commission may, by rule, establish regulations

12  to administer this section and to assure that rating practices

13  used by small employer carriers are consistent with the

14  purpose of this section, including assuring that differences

15  in rates charged for health benefit plans by small employer

16  carriers are reasonable and reflect objective differences in

17  plan design, not including differences due to the nature of

18  the groups assumed to select particular health benefit plans.

19         (b)  For all small employer health benefit plans that

20  are subject to this section and are issued by small employer

21  carriers to small employer groups with 2-25 eligible employees

22  on or after January 1, 1994, premium rates for health benefit

23  plans subject to this section are subject to the following:

24         1.  Small employer carriers must use a modified

25  community rating methodology in which the premium for each

26  small employer must be determined solely on the basis of the

27  eligible employee's and eligible dependent's gender, age,

28  family composition, tobacco use, or geographic area as

29  determined under paragraph (5)(j) and in which the premium may

30  be adjusted as permitted by this paragraph.

31  

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 1         2.  Rating factors related to age, gender, family

 2  composition, tobacco use, or geographic location may be

 3  developed by each carrier to reflect the carrier's experience.

 4  The factors used by carriers are subject to office review and

 5  approval.

 6         3.  Small employer carriers may not modify the rate for

 7  a small employer for 12 months from the initial issue date or

 8  renewal date, unless the composition of the group changes or

 9  benefits are changed. However, a small employer carrier may

10  modify the rate one time prior to 12 months after the initial

11  issue date for a small employer who enrolls under a previously

12  issued group policy that has a common anniversary date for all

13  employers covered under the policy if:

14         a.  The carrier discloses to the employer in a clear

15  and conspicuous manner the date of the first renewal and the

16  fact that the premium may increase on or after that date.

17         b.  The insurer demonstrates to the office that

18  efficiencies in administration are achieved and reflected in

19  the rates charged to small employers covered under the policy.

20         4.  A carrier may issue a group health insurance policy

21  to a small employer health alliance or other group association

22  with rates that reflect a premium credit for expense savings

23  attributable to administrative activities being performed by

24  the alliance or group association if such expense savings are

25  specifically documented in the insurer's rate filing and are

26  approved by the office.  Any such credit may not be based on

27  different morbidity assumptions or on any other factor related

28  to the health status or claims experience of any person

29  covered under the policy. Nothing in this subparagraph exempts

30  an alliance or group association from licensure for any

31  activities that require licensure under the insurance code. A

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 1  carrier issuing a group health insurance policy to a small

 2  employer health alliance or other group association shall

 3  allow any properly licensed and appointed agent of that

 4  carrier to market and sell the small employer health alliance

 5  or other group association policy. Such agent shall be paid

 6  the usual and customary commission paid to any agent selling

 7  the policy.

 8         5.  Any adjustments in rates for claims experience,

 9  health status, or duration of coverage may not be charged to

10  individual employees or dependents. For a small employer's

11  policy, such adjustments may not result in a rate for the

12  small employer which deviates more than 15 percent from the

13  carrier's approved rate. Any such adjustment must be applied

14  uniformly to the rates charged for all employees and

15  dependents of the small employer. A small employer carrier may

16  make an adjustment to a small employer's renewal premium, not

17  to exceed 10 percent annually, due to the claims experience,

18  health status, or duration of coverage of the employees or

19  dependents of the small employer. Semiannually, small group

20  carriers shall report information on forms adopted by rule by

21  the commission, to enable the office to monitor the

22  relationship of aggregate adjusted premiums actually charged

23  policyholders by each carrier to the premiums that would have

24  been charged by application of the carrier's approved modified

25  community rates. If the aggregate resulting from the

26  application of such adjustment exceeds the premium that would

27  have been charged by application of the approved modified

28  community rate by 4 5 percent for the current reporting

29  period, the carrier shall limit the application of such

30  adjustments only to minus adjustments beginning not more than

31  60 days after the report is sent to the office. For any

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 1  subsequent reporting period, if the total aggregate adjusted

 2  premium actually charged does not exceed the premium that

 3  would have been charged by application of the approved

 4  modified community rate by 4 5 percent, the carrier may apply

 5  both plus and minus adjustments. A small employer carrier may

 6  provide a credit to a small employer's premium based on

 7  administrative and acquisition expense differences resulting

 8  from the size of the group. Group size administrative and

 9  acquisition expense factors may be developed by each carrier

10  to reflect the carrier's experience and are subject to office

11  review and approval.

12         6.  A small employer carrier rating methodology may

13  include separate rating categories for one dependent child,

14  for two dependent children, and for three or more dependent

15  children for family coverage of employees having a spouse and

16  dependent children or employees having dependent children

17  only. A small employer carrier may have fewer, but not

18  greater, numbers of categories for dependent children than

19  those specified in this subparagraph.

20         7.  Small employer carriers may not use a composite

21  rating methodology to rate a small employer with fewer than 10

22  employees. For the purposes of this subparagraph, a "composite

23  rating methodology" means a rating methodology that averages

24  the impact of the rating factors for age and gender in the

25  premiums charged to all of the employees of a small employer.

26         8.a.  A carrier may separate the experience of small

27  employer groups with fewer less than 2 eligible employees from

28  the experience of small employer groups with 2-25 2-50

29  eligible employees for purposes of determining an alternative

30  modified community rating.

31  

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 1         b.  If a carrier separates the experience of small

 2  employer groups as provided in sub-subparagraph a., the rate

 3  to be charged to small employer groups of fewer less than 2

 4  eligible employees may not exceed 150 percent of the rate

 5  determined for small employer groups of 2-25 2-50 eligible

 6  employees. However, the carrier may charge excess losses of

 7  the experience pool consisting of small employer groups with

 8  fewer less than 2 eligible employees to the experience pool

 9  consisting of small employer groups with 2-25 2-50 eligible

10  employees so that all losses are allocated and the 150-percent

11  rate limit on the experience pool consisting of small employer

12  groups with fewer less than 2 eligible employees is

13  maintained. Notwithstanding s. 627.411(1), the rate to be

14  charged to a small employer group of fewer than 2 eligible

15  employees, insured as of July 1, 2002, may be up to 125

16  percent of the rate determined for small employer groups of

17  2-25 2-50 eligible employees for the first annual renewal and

18  150 percent for subsequent annual renewals.

19         (c)  For all small employer health benefit plans that

20  are subject to this section, that are issued by small employer

21  carriers before January 1, 1994, and that are renewed on or

22  after January 1, 1995, renewal rates must be based on the same

23  modified community rating standard applied to new business.

24         (d)  Notwithstanding s. 627.401(2), this section and

25  ss. 627.410 and 627.411 apply to any health benefit plan

26  provided by a small employer carrier that is an insurer, and

27  this section and s. 641.31 apply to any health benefit

28  provided by a small employer carrier that is a health

29  maintenance organization, that provides coverage to one or

30  more employees of a small employer regardless of where the

31  policy, certificate, or contract is issued or delivered, if

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 1  the health benefit plan covers employees or their covered

 2  dependents who are residents of this state.

 3         (12)  STANDARD, BASIC, HIGH DEDUCTIBLE, AND LIMITED

 4  HEALTH BENEFIT PLANS.--

 5         (a)1.  The Chief Financial Officer shall appoint a

 6  health benefit plan committee composed of four representatives

 7  of carriers which shall include at least two representatives

 8  of HMOs, at least one of which is a staff model HMO, two

 9  representatives of agents, four representatives of small

10  employers, and one employee of a small employer. The carrier

11  members shall be selected from a list of individuals

12  recommended by the board. The Chief Financial Officer may

13  require the board to submit additional recommendations of

14  individuals for appointment.

15         2.  The plans shall comply with all of the requirements

16  of this subsection.

17         3.  The plans must be filed with and approved by the

18  office prior to issuance or delivery by any small employer

19  carrier.

20         4.  After approval of the revised health benefit plans,

21  if the office determines that modifications to a plan might be

22  appropriate, the Chief Financial Officer shall appoint a new

23  health benefit plan committee in the manner provided in

24  subparagraph 1. to submit recommended modifications to the

25  office for approval.

26         (b)1.  Each small employer carrier issuing new health

27  benefit plans shall offer to any small employer, upon request,

28  a standard health benefit plan, and a basic health benefit

29  plan, and a high deductible plan that meets the requirements

30  of a health savings account plan as defined by federal law,

31  that meet meets the criteria set forth in this section.

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 1         2.  For purposes of this subsection, the terms

 2  "standard health benefit plan," and "basic health benefit

 3  plan," and "high deductible plan" mean policies or contracts

 4  that a small employer carrier offers to eligible small

 5  employers that contain:

 6         a.  An exclusion for services that are not medically

 7  necessary or that are not covered preventive health services;

 8  and

 9         b.  A procedure for preauthorization by the small

10  employer carrier, or its designees.

11         3.  A small employer carrier may include the following

12  managed care provisions in the policy or contract to control

13  costs:

14         a.  A preferred provider arrangement or exclusive

15  provider organization or any combination thereof, in which a

16  small employer carrier enters into a written agreement with

17  the provider to provide services at specified levels of

18  reimbursement or to provide reimbursement to specified

19  providers. Any such written agreement between a provider and a

20  small employer carrier must contain a provision under which

21  the parties agree that the insured individual or covered

22  member has no obligation to make payment for any medical

23  service rendered by the provider which is determined not to be

24  medically necessary. A carrier may use preferred provider

25  arrangements or exclusive provider arrangements to the same

26  extent as allowed in group products that are not issued to

27  small employers.

28         b.  A procedure for utilization review by the small

29  employer carrier or its designees.

30  

31  

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 1  This subparagraph does not prohibit a small employer carrier

 2  from including in its policy or contract additional managed

 3  care and cost containment provisions, subject to the approval

 4  of the office, which have potential for controlling costs in a

 5  manner that does not result in inequitable treatment of

 6  insureds or subscribers. The carrier may use such provisions

 7  to the same extent as authorized for group products that are

 8  not issued to small employers.

 9         4.  The standard health benefit plan shall include:

10         a.  Coverage for inpatient hospitalization;

11         b.  Coverage for outpatient services;

12         c.  Coverage for newborn children pursuant to s.

13  627.6575;

14         d.  Coverage for child care supervision services

15  pursuant to s. 627.6579;

16         e.  Coverage for adopted children upon placement in the

17  residence pursuant to s. 627.6578;

18         f.  Coverage for mammograms pursuant to s. 627.6613;

19         g.  Coverage for handicapped children pursuant to s.

20  627.6615;

21         h.  Emergency or urgent care out of the geographic

22  service area; and

23         i.  Coverage for services provided by a hospice

24  licensed under s. 400.602 in cases where such coverage would

25  be the most appropriate and the most cost-effective method for

26  treating a covered illness.

27         5.  The standard health benefit plan and the basic

28  health benefit plan may include a schedule of benefit

29  limitations for specified services and procedures. If the

30  committee develops such a schedule of benefits limitation for

31  the standard health benefit plan or the basic health benefit

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 1  plan, a small employer carrier offering the plan must offer

 2  the employer an option for increasing the benefit schedule

 3  amounts by 4 percent annually.

 4         6.  The basic health benefit plan shall include all of

 5  the benefits specified in subparagraph 4.; however, the basic

 6  health benefit plan shall place additional restrictions on the

 7  benefits and utilization and may also impose additional cost

 8  containment measures.

 9         7.  Sections 627.419(2), (3), and (4), 627.6574,

10  627.6612, 627.66121, 627.66122, 627.6616, 627.6618, 627.668,

11  and 627.66911 apply to the standard health benefit plan and to

12  the basic health benefit plan. However, notwithstanding said

13  provisions, the plans may specify limits on the number of

14  authorized treatments, if such limits are reasonable and do

15  not discriminate against any type of provider.

16         8.  The plan associated with a health savings account

17  shall include all the benefits specified in subparagraph 4.

18         9.8.  Each small employer carrier that provides for

19  inpatient and outpatient services by allopathic hospitals may

20  provide as an option of the insured similar inpatient and

21  outpatient services by hospitals accredited by the American

22  Osteopathic Association when such services are available and

23  the osteopathic hospital agrees to provide the service.

24         (c)  If a small employer rejects, in writing, the

25  standard health benefit plan, and the basic health benefit

26  plan, and the high deductible health savings account plan, the

27  small employer carrier may offer the small employer a limited

28  benefit policy or contract.

29         (d)1.  Upon offering coverage under a standard health

30  benefit plan, a basic health benefit plan, or a limited

31  benefit policy or contract for any small employer, the small

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 1  employer carrier shall provide such employer group with a

 2  written statement that contains, at a minimum:

 3         a.  An explanation of those mandated benefits and

 4  providers that are not covered by the policy or contract;

 5         b.  An explanation of the managed care and cost control

 6  features of the policy or contract, along with all appropriate

 7  mailing addresses and telephone numbers to be used by insureds

 8  in seeking information or authorization; and

 9         c.  An explanation of the primary and preventive care

10  features of the policy or contract.

11  

12  Such disclosure statement must be presented in a clear and

13  understandable form and format and must be separate from the

14  policy or certificate or evidence of coverage provided to the

15  employer group.

16         2.  Before a small employer carrier issues a standard

17  health benefit plan, a basic health benefit plan, or a limited

18  benefit policy or contract, it must obtain from the

19  prospective policyholder a signed written statement in which

20  the prospective policyholder:

21         a.  Certifies as to eligibility for coverage under the

22  standard health benefit plan, basic health benefit plan, or

23  limited benefit policy or contract;

24         b.  Acknowledges the limited nature of the coverage and

25  an understanding of the managed care and cost control features

26  of the policy or contract;

27         c.  Acknowledges that if misrepresentations are made

28  regarding eligibility for coverage under a standard health

29  benefit plan, a basic health benefit plan, or a limited

30  benefit policy or contract, the person making such

31  

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 1  misrepresentations forfeits coverage provided by the policy or

 2  contract; and

 3         d.  If a limited plan is requested, acknowledges that

 4  the prospective policyholder had been offered, at the time of

 5  application for the insurance policy or contract, the

 6  opportunity to purchase any health benefit plan offered by the

 7  carrier and that the prospective policyholder had rejected

 8  that coverage.

 9  

10  A copy of such written statement shall be provided to the

11  prospective policyholder no later than at the time of delivery

12  of the policy or contract, and the original of such written

13  statement shall be retained in the files of the small employer

14  carrier for the period of time that the policy or contract

15  remains in effect or for 5 years, whichever period is longer.

16         3.  Any material statement made by an applicant for

17  coverage under a health benefit plan which falsely certifies

18  as to the applicant's eligibility for coverage serves as the

19  basis for terminating coverage under the policy or contract.

20         4.  Each marketing communication that is intended to be

21  used in the marketing of a health benefit plan in this state

22  must be submitted for review by the office prior to use and

23  must contain the disclosures stated in this subsection.

24         (e)  A small employer carrier may not use any policy,

25  contract, form, or rate under this section, including

26  applications, enrollment forms, policies, contracts,

27  certificates, evidences of coverage, riders, amendments,

28  endorsements, and disclosure forms, until the insurer has

29  filed it with the office and the office has approved it under

30  ss. 627.410 and 627.411 and this section.

31         (15)  SMALL EMPLOYERS ACCESS PROGRAM.--

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 1         (a)  Popular name.--This subsection may be referred to

 2  by the popular name "The Small Employers Access Program."

 3         (b)  Intent.--The Legislature finds that increased

 4  access to health care coverage for small employers with up to

 5  25 employees could improve employees' health and reduce the

 6  incidence and costs of illness and disabilities among

 7  residents in this state. Many employers do not offer health

 8  care benefits to their employees citing the increased cost of

 9  this benefit. It is the intent of the Legislature to create

10  the Small Business Health Plan to provide small employers the

11  option and ability to provide health care benefits to their

12  employees at an affordable cost through the creation of

13  purchasing pools for employers with up to 25 employees, and

14  rural hospital employers and nursing home employers regardless

15  of the number of employees.

16         (c)  Definitions.--For purposes of this subsection, the

17  term:

18         1.  "Fair commission" means a commission structure

19  determined by the insurers and reflected in the insurers' rate

20  filings made pursuant to this subsection.

21         2.  "Insurer" means any entity that provides health

22  insurance in this state. For purposes of this subsection,

23  insurer includes an insurance company holding a certificate of

24  authority pursuant to chapter 624 or a health maintenance

25  organization holding a certificate of authority pursuant to

26  chapter 641, which qualifies to provide coverage to small

27  employer groups pursuant to this section.

28         3.  "Mutually supported benefit plan" means an optional

29  alternative coverage plan developed within a defined

30  geographic region which may include, but is not limited to, a

31  minimum level of primary care coverage in which the percentage

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 1  of the premium is distributed among the employer, the

 2  employee, and community-generated revenue either alone or in

 3  conjunction with federal matching funds.

 4         4.  "Office" means the Office of Insurance Regulation

 5  of the Department of Financial Services.

 6         5.  "Participating insurer" means any insurer providing

 7  health insurance to small employers that has been selected by

 8  the office in accordance with this subsection for its

 9  designated region.

10         6.  "Program" means the Small Employer Access Program

11  as created by this subsection.

12         (d)  Eligibility.--

13         1.  Any small employer group of up to 25 employees.

14         2.  Any municipality, county, school district, or

15  hospital located in a rural community as defined in s.

16  288.0636(2)(b).

17         3.  Nursing home employers may participate.

18         4.  Each dependent of a person eligible for coverage is

19  also eligible to participate.

20         5.  Any small employer that is actively engaged in

21  business, has its principal place of business in this state,

22  employed up to 25 eligible employees on business days during

23  the preceding calendar year, and employs at least 2 employees

24  on the first day of the plan year may participate.

25  

26  Coverage for a small employer group that ceases to meet the

27  eligibility requirements of this section may be terminated at

28  the end of the policy period for which the necessary premiums

29  have been paid.

30         (e)  Administration.--

31  

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 1         1.  The office shall by competitive bid, in accordance

 2  with current state law, select an insurer to provide coverage

 3  through the program to eligible small employers within an

 4  established geographical area of this state. The office may

 5  develop exclusive regions for the program similar to those

 6  used by the Healthy Kids Corporation. However the office is

 7  not precluded from developing, in conjunction with insurers,

 8  regions different from those used by the Healthy Kids

 9  Corporation if the office deems that such a region will carry

10  out the intentions of this subsection.

11         2.  The office shall evaluate bids submitted based upon

12  criteria established by the office, which shall include, but

13  not be limited to:

14         a.  The insurer's proven ability to handle health

15  insurance coverage to small employer groups.

16         b.  The efficiency and timeliness of the insurer's

17  claim processing procedures.

18         c.  The insurer's ability to apply effective

19  cost-containment programs and procedures and to administer the

20  program in a cost-efficient manner.

21         d.  The financial condition and stability of the

22  insurer.

23         e.  The insurer's ability to develop an optional

24  mutually supported benefit plan.

25  

26  The office may use any financial information available to it

27  through its regulatory duties to make this evaluation.

28         (f)  Insurer qualifications.--The insurer shall be a

29  duly authorized insurer or health maintenance organization.

30         (g)  Duties of the insurer.--The insurer shall:

31  

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 1         1.  Develop and implement a program to publicize the

 2  existence of the program, program eligibility requirements,

 3  and procedures for enrollment and maintain public awareness of

 4  the program.

 5         2.  Maintain employer awareness of the program.

 6         3.  Demonstrate the ability to use delivery of

 7  cost-effective health care services.

 8         4.  Encourage, educate, advise, and administer the

 9  effective use of health savings accounts by covered employees

10  and dependents.

11         5.  Serve for a period specified in the contract

12  between the office and the insurer, subject to removal for

13  cause and subject to any terms, conditions, and limitations of

14  the contract between the office and the insurer as may be

15  specified in the request for proposal.

16         (h)  Contract term.--The contract term shall not exceed

17  3 years. At least 6 months prior to the expiration of each

18  contract period, the office shall invite eligible entities,

19  including the current insurer, to submit bids to serve as the

20  insurer for a designated geographic area. Selection of the

21  insurer for the succeeding period shall be made at least 3

22  months prior to the end of the current period. If a protest is

23  filed and not resolved by the end of the contract period, the

24  contract with the existing administrator may be extended for a

25  period not to exceed 6 months. During the contract extension

26  period, the administrator shall be paid at a rate to be

27  negotiated by the office.

28         (i)  Insurer reporting requirements.--On March 1

29  following the close of each calendar year, the insurer shall

30  determine net written and earned premiums, the expense of

31  administration, and the paid and incurred losses for the year

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 1  and report this information to the office on a form prescribed

 2  by the office.

 3         (j)  Application requirements.--The insurer shall

 4  permit or allow any licensed and duly appointed health

 5  insurance agent residing in the designated region to submit

 6  applications for coverage, and such agent shall be paid a fair

 7  commission if coverage is written. The agent must be appointed

 8  to at least one insurer.

 9         (k)  Benefits.--The benefits provided by the plan shall

10  be the same as the coverage required for small employers under

11  subsection (12). Upon the approval of the office, the insurer

12  may also establish an optional mutually supported benefit plan

13  which is an alternative plan developed within a defined

14  geographic region of this state or any other such alternative

15  plan which will carry out the intent of this subsection. Any

16  small employer carrier issuing new health benefit plans may

17  offer a benefit plan with coverages similar to, but not less

18  than, any alternative coverage plan developed pursuant to this

19  subsection.

20         (l)  Annual reporting.--The office shall make an annual

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

22  Speaker of the House of Representatives. The report shall

23  summarize the activities of the program in the preceding

24  calendar year, including the net written and earned premiums,

25  program enrollment, the expense of administration, and the

26  paid and incurred losses. The report shall be submitted no

27  later than March 15 following the close of the prior calendar

28  year.

29         (16)(15)  APPLICABILITY OF OTHER STATE LAWS.--

30         (a)  Except as expressly provided in this section, a

31  law requiring coverage for a specific health care service or

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 1  benefit, or a law requiring reimbursement, utilization, or

 2  consideration of a specific category of licensed health care

 3  practitioner, does not apply to a standard or basic health

 4  benefit plan policy or contract or a limited benefit policy or

 5  contract offered or delivered to a small employer unless that

 6  law is made expressly applicable to such policies or

 7  contracts. A law restricting or limiting deductibles,

 8  coinsurance, copayments, or annual or lifetime maximum

 9  payments does not apply to any health plan policy, including a

10  standard or basic health benefit plan policy or contract,

11  offered or delivered to a small employer unless such law is

12  made expressly applicable to such policy or contract. However,

13  every small employer carrier must offer to eligible small

14  employers the standard benefit plan and the basic benefit

15  plan, as required by subsection (5), as such plans have been

16  approved by the office pursuant to subsection (12).

17         (b)  Except as provided in this section, a standard or

18  basic health benefit plan policy or contract or limited

19  benefit policy or contract offered to a small employer is not

20  subject to any provision of this code which:

21         1.  Inhibits a small employer carrier from contracting

22  with providers or groups of providers with respect to health

23  care services or benefits;

24         2.  Imposes any restriction on a small employer

25  carrier's ability to negotiate with providers regarding the

26  level or method of reimbursing care or services provided under

27  a health benefit plan; or

28         3.  Requires a small employer carrier to either include

29  a specific provider or class of providers when contracting for

30  health care services or benefits or to exclude any class of

31  

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 1  providers that is generally authorized by statute to provide

 2  such care.

 3         (c)  Any second tier assessment paid by a carrier

 4  pursuant to paragraph (11)(j) may be credited against

 5  assessments levied against the carrier pursuant to s.

 6  627.6494.

 7         (d)  Notwithstanding chapter 641, a health maintenance

 8  organization is authorized to issue contracts providing

 9  benefits equal to the standard health benefit plan, the basic

10  health benefit plan, and the limited benefit policy authorized

11  by this section.

12         (17)(16)  RULEMAKING AUTHORITY.--The commission may

13  adopt rules to administer this section, including rules

14  governing compliance by small employer carriers and small

15  employers.

16         Section 27.  Section 627.9175, Florida Statutes, is

17  amended to read:

18         627.9175  Reports of information on health and accident

19  insurance.--

20         (1)  Each health insurer, prepaid limited health

21  services organization, and health maintenance organization

22  shall submit, no later than April 1 of each year, annually to

23  the office information concerning health and accident

24  insurance coverage and medical plans being marketed and

25  currently in force in this state. The required information

26  shall be described by market segment, including, but not

27  limited to:

28         (a)  Issuing, servicing company, and entity contact

29  information.

30         (b)  Information on all health and accident insurance

31  policies and prepaid limited health service organizations and

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 1  health maintenance organization contracts in force and issued

 2  in the previous year. Such information shall include, but not

 3  be limited to, direct premiums earned, direct losses incurred,

 4  number of policies, number of certificates, number of covered

 5  lives, number or the percentage of claims denied and claims

 6  meeting prompt pay requirements, and the average number of

 7  days taken to pay claims. as to policies of individual health

 8  insurance:

 9         (a)  A summary of typical benefits, exclusions, and

10  limitations for each type of individual policy form currently

11  being issued in the state. The summary shall include, as

12  appropriate:

13         1.  The deductible amount;

14         2.  The coinsurance percentage;

15         3.  The out-of-pocket maximum;

16         4.  Outpatient benefits;

17         5.  Inpatient benefits; and

18         6.  Any exclusions for preexisting conditions.

19  

20  The commission shall determine other appropriate benefits,

21  exclusions, and limitations to be reported for inclusion in

22  the consumer's guide published pursuant to this section.

23         (b)  A schedule of rates for each type of individual

24  policy form reflecting typical variations by age, sex, region

25  of the state, or any other applicable factor which is in use

26  and is determined to be appropriate for inclusion by the

27  commission.

28  

29  The commission may establish rules governing shall provide by

30  rule a uniform format for the submission of this information

31  described in this section, including the use of uniform

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 1  formats and electronic data transmission order to allow for

 2  meaningful comparisons of premiums charged for comparable

 3  benefits. The office shall provide this information to the

 4  department, which shall publish annually a consumer's guide

 5  which summarizes and compares the information required to be

 6  reported under this subsection.

 7         (2)(a)  Every insurer transacting health insurance in

 8  this state shall report annually to the office, not later than

 9  April 1, information relating to any measure the insurer has

10  implemented or proposes to implement during the next calendar

11  year for the purpose of containing health insurance costs or

12  cost increases. The reports shall identify each measure and

13  the forms to which the measure is applied, shall provide an

14  explanation as to how the measure is used, and shall provide

15  an estimate of the cost effect of the measure.

16         (b)  The commission shall promulgate forms to be used

17  by insurers in reporting information pursuant to this

18  subsection and shall utilize such forms to analyze the effects

19  of health care cost containment programs used by health

20  insurers in this state.

21         (c)  The office shall analyze the data reported under

22  this subsection and shall annually make available to the

23  department which shall provide to the public a summary of its

24  findings as to the types of cost containment measures reported

25  and the estimated effect of these measures.

26         Section 28.  (1)  Effective January 1, 2005, chapter

27  636, Florida Statutes, is redesignated as "Prepaid Limited

28  Health Service Organizations and Discount Medical Plan

29  Organizations."

30         (2)  Effective January 1, 2005, sections

31  636.002-636.067, Florida Statutes, are designated as part I of

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 1  chapter 636, Florida Statutes, entitled "Prepaid Limited

 2  Health Service Organizations."

 3         Section 29.  Effective January 1, 2005, section

 4  636.002, Florida Statutes, is amended to read:

 5         636.002  Short title.--This part Sections 1-57, chapter

 6  93-148, Laws of Florida, may be cited as the "Prepaid Limited

 7  Health Service Organization Act of Florida."

 8         Section 30.  Effective January 1, 2005, subsection (7)

 9  of section 636.003, Florida Statutes, is amended to read:

10         636.003  Definitions.--As used in this act, the term:

11         (7)  "Prepaid limited health service organization"

12  means any person, corporation, partnership, or any other

13  entity which, in return for a prepayment, undertakes to

14  provide or arrange for, or provide access to, the provision of

15  a limited health service to enrollees through an exclusive

16  panel of providers. Prepaid limited health service

17  organization does not include:

18         (a)  An entity otherwise authorized pursuant to the

19  laws of this state to indemnify for any limited health

20  service;

21         (b)  A provider or entity when providing limited health

22  services pursuant to a contract with a prepaid limited health

23  service organization, a health maintenance organization, a

24  health insurer, or a self-insurance plan; or

25         (c)  Any person who is licensed pursuant to part II of

26  this chapter as a discount medical plan organization, in

27  exchange for fees, dues, charges or other consideration,

28  provides access to a limited health service provider without

29  assuming any responsibility for payment for the limited health

30  service or any portion thereof.

31  

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 1         Section 31.  Effective January 1, 2005, part II of

 2  chapter 636, Florida Statutes, consisting of sections 636.202,

 3  636.204, 636.206, 636.208, 636.210, 636.212, 636.214, 636.216,

 4  636.218, 636.220, 636.222, 636.224, 636.226, 636.228, 636.230,

 5  636.232, 636.234, 636.236, 636.238, 636.240, 636.242, and

 6  636.244, is created to read:

 7                             Part II

 8               Discount Medical Plan Organizations

 9         636.202  Definitions.--As used in this part, the term:

10         (1)  "Commission" means the Financial Services

11  Commission.

12         (2)  "Discount medical plan" means a business

13  arrangement or contract in which a person, in exchange for

14  fees, dues, charges, or other consideration, provides access

15  for plan members to providers of medical services and the

16  right to receive medical services from those providers at a

17  discount.

18         (3)  "Discount medical plan organization" means a

19  person who, in exchange for fees, dues, charges, or other

20  consideration, provides members a discount medical plan.

21         (4)  "Marketer" means a person that markets, promotes,

22  sells, or distributes a discount medical plan, including a

23  private label entity which places its name on and markets or

24  distributes a discount medical plan, but does not operate a

25  discount medical plan.

26         (5)  "Medical services" means any care, service, or

27  treatment of an illness or a dysfunction of, or injury to, the

28  human body, including, but not limited to, physician care,

29  inpatient care, hospital surgical services, emergency

30  services, ambulance services, dental care services, vision

31  care services, mental health services, substance abuse

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 1  services, chiropractic services, podiatric care services,

 2  laboratory services, medical equipment and supplies. The term

 3  does not include pharmaceutical supplies or prescriptions.

 4         (6)  "Member" means any person who pays fees, dues,

 5  charges, or other consideration for the right to receive the

 6  benefits of a discount medical plan.

 7         (7)  "Office" means the Office of Insurance Regulation

 8  of the Financial Services Commission.

 9         (8)  "Provider" means any person that contracts,

10  directly or indirectly, with a discount medical plan

11  organization to provide medical services to members.

12         (9)  "Provider network" means an entity that negotiates

13  on behalf of more than one provider with a discount medical

14  plan organization to provide medical services to members.

15         636.204  License.--

16         (1)  A person may not conduct business in this state as

17  a discount medical plan organization unless the person:

18         (a)  Is a corporation, either incorporated under the

19  laws of this state, or, if a foreign corporation, is

20  authorized to transact business in this state; and

21         (b)  Is licensed as a discount medical plan

22  organization by the office.

23         (2)  An application for a license to operate as a

24  discount medical plan organization must be filed with the

25  office on a form prescribed by the commission. The application

26  must be sworn to by an officer or authorized representative of

27  the applicant and must be accompanied by the following:

28         (a)  A copy of the applicant's articles of

29  incorporation, including all amendments.

30         (b)  A copy of the corporate bylaws.

31  

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 1         (c)  A list of the names, addresses, official

 2  positions, and biographical information of the individuals

 3  responsible for conducting the applicant's affairs, including,

 4  but not limited to, all members of the board of directors,

 5  board of trustees, executive committee, or other governing

 6  board or committee, the officers, contracted management

 7  company personnel, and any person or entity owning or having

 8  the right to acquire 10 percent or more of the voting

 9  securities of the applicant. The list must fully disclose the

10  extent and nature of any contract or arrangement between any

11  individual who is responsible for conducting the applicant's

12  affairs and the discount medical plan organization, including

13  any possible conflicts of interest.

14         (d)  A complete biographical statement, on forms

15  prescribed by the commission, an independent investigation

16  report, and a set of fingerprints, as provided in chapter 624,

17  from each individual identified in subsection (c).

18         (e)  A statement describing the applicant, its

19  facilities, and personnel and the medical services it proposes

20  to offer.

21         (f)  A copy of any form contract used by the applicant

22  with any provider or provider network regarding the provision

23  of medical services to members.

24         (g)  A copy of any form contract used by the applicant

25  with any person listed in subsection (c).

26         (h)  A copy of any form contract used by the applicant

27  with any person, corporation, partnership, or other entity for

28  the performance on the applicant's behalf of any function,

29  including, but not limited to, marketing, administration,

30  enrollment, investment management, and subcontracting for the

31  provision of health services to members.

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 1         (i)  A copy of the applicant's most recent financial

 2  statements that have been audited by an independent certified

 3  public accountant.

 4         (j)  A description of the applicant's proposed method

 5  of marketing.

 6         (k)  A description of the member's complaint procedures

 7  to be established and maintained by the applicant.

 8         (l)  The fee for issuance of a license.

 9         (m)  Such other information as the commission or office

10  may request from the applicant.

11         (3)  The office shall issue a license that expires 1

12  year after the date of issuance, and each year on that date

13  thereafter. The office shall renew the license if the licensee

14  pays the annual license fee of $50 and if the licensee is in

15  compliance with this part.

16         (4)  Before the office issues a license, each medical

17  discount plan organization must establish a website in order

18  to conform with the requirements of s. 636.226.

19         (5)  The license fee under this section is $50 per

20  year, per licensee.  All amounts collected shall be deposited

21  in the General Revenue Fund.

22         (6)  This part does not require a provider who provides

23  discounts to his or her own patients to obtain and maintain a

24  license as a discount medical plan organization.

25         636.206  Examinations and investigations.--

26         (1)  The office may examine or investigate any discount

27  medical plan organization. The office may order any discount

28  medical plan organization or applicant to produce any records,

29  books, files, advertising and solicitation materials, or other

30  information and may take statements under oath to determine

31  whether the discount medical plan organization or applicant is

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 1  in violation of the law or is acting contrary to the public

 2  interest. The expenses incurred in conducting an examination

 3  or investigation must be paid by the discount medical plan

 4  organization or applicant. Examinations and investigations

 5  must be conducted as provided in chapter 624 and a discount

 6  medical plan organization is subject to all applicable

 7  provisions of the Florida Insurance Code.

 8         (2)  Failure by a discount medical plan organization to

 9  pay the costs incurred under this section is grounds for

10  denial or revocation of a license.

11         636.208  Permitted activities of a discount medical

12  plan.--A discount medical plan organization may engage in the

13  following activities:

14         (1)  Charge a monthly fee to its members. However, if a

15  discount medical plan charges a fee for a time period

16  exceeding 1 month, it must, in the event of cancellation of

17  the membership by either party, make a pro rata reimbursement

18  of the fee to the member.

19         (2)  Enter into contracts with a provider or provider

20  network in which the provider or provider network agrees to

21  provide medical services at a discount to plan members.

22         636.210  Prohibited activities of a discount medical

23  plan.--

24         (1)  A discount medical plan organization may not:

25         (a)  Use in its advertisements, marketing material,

26  brochures, or discount cards the term "insurance" except as

27  otherwise authorized in this part;

28         (b)  Use in its advertisements, marketing material,

29  brochures, or discount cards the terms "affordable

30  healthcare", "health plan", "coverage", "co-pay",

31  "co-payments", "pre-existing conditions", "guaranteed issue",

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 1  "premium" or other terms that could reasonably mislead a

 2  person into believing the discount medical plan was health

 3  insurance;

 4         (c)  Have restrictions on free access to plan

 5  providers, including, but not limited to, waiting periods and

 6  notification periods; or

 7         (d)  Pay providers any fees for medical services.

 8         (2)  A discount medical plan organization is prohibited

 9  from collecting or accepting money from a member for payment

10  to a provider for specific medical services furnished or to be

11  furnished to the member unless it has an active certificate of

12  authority from the office to act as an administrator.

13         636.212  Disclosures.--The following disclosures must

14  be made in writing to any prospective member, and must be on

15  the first page of any advertisements, marketing material, or

16  brochures relating to a discount medical plan. The disclosures

17  must be printed in not less than 10-point type or no smaller

18  than the largest type on the page if larger than 10-point

19  type, and must state that:

20         (1)  The plan is not insurance;

21         (2)  The plan does not make payments directly to

22  providers of medical services;

23         (3)  The plan member is obligated to pay to the

24  provider the full amount of the discounted fees; and

25         (4)  The corporate name and the locations of the

26  licensed discount medical plan organization.

27         636.214  Provider agreements.--

28         (1)  A provider offering medical services to a member

29  under a discount medical plan must provide the service under a

30  written agreement with the organization. The agreement may be

31  

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 1  entered into directly by the provider or by a provider network

 2  to which the provider belongs.

 3         (2)  A provider agreement must contain the following:

 4         (a)  A list of the services and products to be

 5  delivered at a discount;

 6         (b)  A statement specifying the amount of the discounts

 7  offered or, alternatively, a fee schedule that reflects the

 8  provider's discounted rates; and

 9         (c)  A statement that the provider will not charge

10  members more than the discounted rates.

11         (3)  A provider agreement between a discount medical

12  plan organization and a provider network shall require the

13  provider network to have written agreements with each

14  provider. An agreement must:

15         (a)  Contain the elements described in subsection (2);

16         (b)  Authorize the provider network to contract with

17  the medical discount medical plan organization on behalf of

18  the provider; and

19         (c)  Require the provider network to maintain an

20  up-to-date list of the providers with whom it has a contract

21  and to deliver that list to the discount medical plan

22  organization each month.

23         (4)  The discount medical plan organization shall

24  maintain a copy of each active provider agreement.

25         636.216  Form and rate filings.--

26         (1)  All fees charged to members must be filed with the

27  office and must be approved by the office before they can be

28  imposed on a member. The discount medical plan organization

29  has the burden of proof that the fees charged bear a

30  reasonable relation to the benefits received by the member.

31  

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 1         (2)  There must be a written agreement between the

 2  discount medical plan organization and the member specifying

 3  the benefits under the discount medical plan and complying

 4  with the disclosure requirements of this part.

 5         (3)  Any form used by the discount medical plan

 6  organization, including the written agreement between the

 7  organization and the member, must first be filed with and

 8  approved by the office. Every form filed shall be identified

 9  by a unique form number placed in the lower left corner of

10  each form.

11         (4)  If the office disapproves any filing, the office

12  shall notify the discount medical plan organization in writing

13  and must specify the reasons why the office disapproved the

14  filing. The discount medical plan organization has 21 days

15  from the date it receives the disapproval notice to request a

16  hearing before the office under chapter 120.

17         636.218  Annual reports.--

18         (1)  Each discount medical plan organization must file

19  with the office an annual report no later than 3 months after

20  the end of the organization's fiscal year.

21         (2)  The report must be on a form and in a format

22  prescribed by the commission and must include:

23         (a)  Audited financial statements prepared in

24  accordance with generally accepted accounting principles and

25  certified by an independent certified public accountant. The

26  financial statements shall include the organization's balance

27  sheet, income statement, and statement of changes in cash flow

28  for the preceding year.

29         (b)  A list of the names and residence addresses of all

30  persons responsible for the conduct of its affairs, together

31  with a disclosure of the extent and nature of any contracts or

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 1  arrangements between these persons and the discount medical

 2  plan organization, including any possible conflicts of

 3  interest.

 4         (c)  The number of discount medical plan members.

 5         (d)  Such other information relating to the performance

 6  of the discount medical plan organization that is required by

 7  the commission or office.

 8         (3)  A discount medical plan organization that fails to

 9  file an annual report in the form and within the time required

10  by this section shall forfeit up to $500 for each day for the

11  first 10 days during which the report is delinquent and shall

12  forfeit up to $1,000 for each day after the first 10 days

13  during which the report is delinquent. Upon notice by the

14  office, the organization may no longer enroll new members or

15  do business in this state until the organization complies with

16  this section. The office shall deposit all sums collected by

17  it under this section to the credit of the Insurance

18  Regulatory Trust Fund. The office may not collect more than

19  $50,000 for each delinquent report.

20         636.220  Minimum capital requirements.--

21         (1)  Each discount medical plan organization must at

22  all times maintain a net worth of at least $150,000.

23         (2)  The office may not issue a license unless the

24  medical discount medical plan organization has a net worth of

25  at least $150,000.

26         636.222  Suspension or revocation of license;

27  suspension of enrollment of new members; terms of

28  suspension.--

29         (1)  The office may suspend the authority of a discount

30  medical plan organization to enroll new members, may revoke a

31  license issued to a discount medical plan organization, or may

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 1  order compliance if it finds that any of the following

 2  conditions exist:

 3         (a)  The organization is not operating in compliance

 4  with this part.

 5         (b)  The discount medical plan organization does not

 6  have the minimum net worth as required by this part.

 7         (c)  The organization has advertised, merchandised, or

 8  attempted to merchandise its services in a manner as to

 9  misrepresent its services or capacity for service or has

10  engaged in deceptive, misleading, or unfair practices with

11  respect to advertising or merchandising.

12         (d)  The discount medical plan organization is not

13  fulfilling its obligations as a discount medical plan

14  organization.

15         (e)  The continued operation of the discount medical

16  plan organization would be hazardous to its members.

17         (2)  If the office has cause to believe that grounds

18  for the suspension or revocation of a license exist, it shall

19  notify the discount medical plan organization in writing

20  specifically stating the grounds for suspension or revocation

21  and shall pursue a hearing on the matter in accordance with

22  chapter 120.

23         (3)  If the license of a discount medical plan

24  organization is surrendered or revoked, the organization must

25  proceed, immediately following the effective date of the order

26  of revocation, to wind up its affairs transacted under the

27  license. It may not engage in any further advertising,

28  solicitation, collecting of fees, or renewal of contracts.

29         (4)  The office shall, in its order suspending the

30  authority of a discount medical plan organization to enroll

31  new members, specify the period during which the suspension is

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 1  to be in effect and the conditions, if any, which must be met

 2  by the discount medical plan organization before reinstatement

 3  of its license to enroll new members. The order of suspension

 4  is subject to rescission or modification by further order of

 5  the office before expiration of the suspension period.

 6  Reinstatement may not be made unless requested by the discount

 7  medical plan organization. However, the office may not grant

 8  reinstatement if it finds that the circumstances for which the

 9  suspension occurred still exist or are likely to recur.

10         636.224  Notice of change of name or address of

11  discount medical plan organization.--Each discount medical

12  plan organization must notify the office at least 30 days in

13  advance of any change in the discount medical plan

14  organization's name, address, principal business address, or

15  mailing address.

16         636.226  Provider name listing.--

17         (1)  Each discount medical plan organization must

18  maintain an up-to-date list of the names and addresses of the

19  providers with whom it has a contract to deliver medical

20  services. The list must be stored on its website, the Internet

21  address of which must be prominently displayed on all its

22  advertisements, marketing material, brochures, and discount

23  cards.

24         (2)  This section applies to providers with whom the

25  discount medical plan organization has contracted directly and

26  to those who are members of a provider network with which the

27  discount medical plan organization has a contract to deliver

28  medical services.

29         636.228  Marketing of discount medical plans.--

30  

31  

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 1         (1)  All advertisements, marketing material, brochures,

 2  and discount cards used by marketers must be approved in

 3  writing for use by the discount medical plan organization.

 4         (2)  The discount medical plan organization shall have

 5  an executed written agreement with a marketer before the

 6  marketer marketing, promoting, selling, or distributing the

 7  discount medical plan.

 8         (3)  A person may not act in the capacity of a marketer

 9  unless licensed as an agent as defined in s. 626.015(2).

10         (4)  A person may not act as a marketer for a discount

11  medical plan program unless appointed by the discount medical

12  plan program, using a form prescribed by the commission.

13         636.230  Bundling discount medical plans with other

14  insurance products.--When a marketer or discount medical plan

15  organization sells a discount medical plan along with any

16  other product, the fees for each product must be itemized

17  separately and provided to the members in writing.

18         636.232  Rules.--The commission may adopt rules to

19  administer this part, including rules for the licensing of

20  discount medical plan organizations; establishing standards

21  for evaluating forms, advertisements, marketing material,

22  brochures, and discount cards; the collection of data;

23  disclosures to plan members; and rules defining terms used in

24  this act.

25         636.234  Service of process on a discount medical plan

26  organization.--Sections 624.422 and 624.423 apply to a

27  discount medical plan organization as if a discount medical

28  plan organization were an insurer.

29         636.236  Security deposit.--

30         (1)  A licensed discount medical plan organization must

31  deposit, and maintain deposited in trust with the department,

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 1  securities eligible for deposit under s. 625.52, in order that

 2  the office might protect plan members. The securities must, at

 3  all times, have a value of not less than $35,000.

 4         (2)  A judgment creditor or other claimant of a

 5  discount medical plan organization, other than the office or

 6  the Department of Financial Services, does not have the right

 7  to levy upon any of the assets or securities held in this

 8  state as a deposit under this section.

 9         636.238  Penalties for violation of this part.--

10         (1)  Except as provided in subsection (2), a person who

11  violates this part commits a misdemeanor of the second degree,

12  punishable as provided in s. 775.082 or s. 775.083.

13         (2)  A person who operates as or aids and abets another

14  operating as a discount medical plan organization in violation

15  of s. 636.204(1) commits a felony punishable as provided for

16  in s. 624.401(4)(b), as if the unlicensed discount medical

17  plan organization were an unauthorized insurer, and the fees,

18  dues, charges, or other consideration collected from the

19  members by the unlicensed discount medical plan organization

20  or marketer were insurance premium.

21         (3)  A person who collects fees for purported

22  membership in a discount medical plan but fails to provide the

23  promised benefits commits a theft punishable as provided in s.

24  812.014.

25         636.240  Injunction.--

26         (1)  In addition to the penalties and other enforcement

27  provisions of this act, the office may commence an action for

28  temporary and permanent injunctive relief if:

29         (a)  A discount medical plan is operated by a person

30  that is not licensed under this part.

31  

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 1         (b)  A person, entity, or discount medical plan

 2  organization has engaged in any activity prohibited by this

 3  act or any rule adopted under this act.

 4         (2)  Venue for any proceeding bought under this section

 5  shall be in the Circuit Court for Leon County.

 6         (3)  The office's authority to seek injunctive relief

 7  is not conditioned on having conducted any proceeding under

 8  chapter 120.

 9         636.242  Civil remedies.--Any person injured by a

10  person acting in violation of this part may bring a civil

11  action against the person committing the violation in the

12  circuit court of the county in which the alleged violator

13  resides or has a principal place of business or in the county

14  where the alleged violation occurred. If the defendant is

15  found to have injured the plaintiff, the defendant is liable

16  for damages and the court may also award the prevailing

17  plaintiff court costs and reasonable attorney's fees. If so

18  awarded, the court costs and attorney's fees must be included

19  in the judgment or decree rendered in the case. If it appears

20  to the court that the suit brought by the plaintiff is

21  frivolous or brought for purposes of harassment, the court may

22  award the defendant court costs and reasonable attorney's fees

23  and may apply sanctions against the plaintiff in accordance

24  with chapter 57.

25         636.244  Unlicensed discount medical plan

26  organizations.--Sections 626.901 through 626.912 apply to the

27  activities of an unlicensed discount medical plan organization

28  as if an unlicensed discount medical plan organization were an

29  unauthorized insurer.

30         Section 32.  Section 627.65626, Florida Statutes, is

31  created to read:

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 1         627.65626  Insurance rebates for healthy lifestyles.--

 2         (1)  Any rate, rating schedule, or rating manual for a

 3  health insurance policy filed with the office shall provide

 4  for an appropriate rebate of premiums paid in the last

 5  calendar year when the majority of members of a health plan

 6  have enrolled and maintained participation in any health

 7  wellness, maintenance, or improvement program offered by the

 8  employer. The employer must provide evidence of demonstrative

 9  maintenance or improvement of the enrollees' health status as

10  determined by assessments of agreed-upon health status

11  indicators between the employer and the health insurer,

12  including, but not limited to, reduction in weight, body mass

13  index, and smoking cessation. Any rebate provided by the

14  health insurer is presumed to be appropriate unless credible

15  data demonstrates otherwise, but shall not exceed 10 percent

16  of paid premiums.

17         (2)  The premium rebate authorized by this section

18  shall be effective for an insured on an annual basis, unless

19  the number of participating employees becomes less than the

20  majority of the employees eligible for participation in the

21  wellness program.

22         Section 33.  Section 627.6402, Florida Statutes, is

23  created to read:

24         627.6402  Insurance rebates for healthy lifestyles.--

25         (1)  Any rate, rating schedule, or rating manual for an

26  individual health insurance policy filed with the office shall

27  provide for an appropriate rebate of premiums paid in the last

28  calendar year when the individual covered by such plan is

29  enrolled in and maintains participation in any health

30  wellness, maintenance, or improvement program approved by the

31  health plan. The individual must provide evidence of

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 1  demonstrative maintenance or improvement of the individual's

 2  health status as determined by assessments of agreed-upon

 3  health status indicators between the individual and the health

 4  insurer, including, but not limited to, reduction in weight,

 5  body mass index, and smoking cessation. Any rebate provided by

 6  the health insurer is presumed to be appropriate unless

 7  credible data demonstrates otherwise, but shall not exceed 10

 8  percent of paid premiums.

 9         (2)  The premium rebate authorized by this section

10  shall be effective for an insured on an annual basis, unless

11  the individual fails to maintain or improve his or her health

12  status while participating in an approved wellness program, or

13  credible evidence demonstrates that the individual is not

14  participating in the approved wellness program.

15         Section 34.  Subsection (38) of section 641.31, Florida

16  Statutes, is amended, and subsection (40) is added to that

17  section, to read:

18         641.31  Health maintenance contracts.--

19         (38)(a)  Notwithstanding any other provision of this

20  part, a health maintenance organization that meets the

21  requirements of paragraph (b) may, through a point-of-service

22  rider to its contract providing comprehensive health care

23  services, include a point-of-service benefit. Under such a

24  rider, a subscriber or other covered person of the health

25  maintenance organization may choose, at the time of covered

26  service, a provider with whom the health maintenance

27  organization does not have a health maintenance organization

28  provider contract. The rider may not require a referral from

29  the health maintenance organization for the point-of-service

30  benefits.

31  

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 1         (b)  A health maintenance organization offering a

 2  point-of-service rider under this subsection must have a valid

 3  certificate of authority issued under the provisions of the

 4  chapter, must have been licensed under this chapter for a

 5  minimum of 3 years, and must at all times that it has riders

 6  in effect maintain a minimum surplus of $5 million. A health

 7  maintenance organization offering a point-of-service rider to

 8  its contract providing comprehensive health care services may

 9  offer the rider to employers who have employees living and

10  working outside the health maintenance organization's approved

11  geographic service area without having to obtain a health care

12  provider certificate, as long as the master group contract is

13  issued to an employer that maintains its primary place of

14  business within the health maintenance organization's approved

15  service area. Any member or subscriber that lives and works

16  outside the health maintenance organization's service area and

17  elects coverage under the health maintenance organization's

18  point-of-service rider must provide a statement to the health

19  maintenance organization which indicates that the member or

20  subscriber understands the limitations of his or her policy

21  and that only those benefits under the point-of-service rider

22  will be covered when services are provided outside the service

23  area.

24         (c)  Premiums paid in for the point-of-service riders

25  may not exceed 15 percent of total premiums for all health

26  plan products sold by the health maintenance organization

27  offering the rider. If the premiums paid for point-of-service

28  riders exceed 15 percent, the health maintenance organization

29  must notify the office and, once this fact is known, must

30  immediately cease offering such a rider until it is in

31  compliance with the rider premium cap.

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 1         (d)  Notwithstanding the limitations of deductibles and

 2  copayment provisions in this part, a point-of-service rider

 3  may require the subscriber to pay a reasonable copayment for

 4  each visit for services provided by a noncontracted provider

 5  chosen at the time of the service. The copayment by the

 6  subscriber may either be a specific dollar amount or a

 7  percentage of the reimbursable provider charges covered by the

 8  contract and must be paid by the subscriber to the

 9  noncontracted provider upon receipt of covered services. The

10  point-of-service rider may require that a reasonable annual

11  deductible for the expenses associated with the

12  point-of-service rider be met and may include a lifetime

13  maximum benefit amount. The rider must include the language

14  required by s. 627.6044 and must comply with copayment limits

15  described in s. 627.6471. Section 641.3154 does not apply to a

16  point-of-service rider authorized under this subsection.

17         (e)  The point-of-service rider must contain provisions

18  that comply with s. 627.6044.

19         (f)(e)  The term "point of service" may not be used by

20  a health maintenance organization except with riders permitted

21  under this section or with forms approved by the office in

22  which a point-of-service product is offered with an indemnity

23  carrier.

24         (g)(f)  A point-of-service rider must be filed and

25  approved under ss. 627.410 and 627.411.

26         (40)(a)  Any rate, rating schedule, or rating manual

27  for a health maintenance organization policy filed with the

28  office shall provide for an appropriate rebate of premiums

29  paid in the last calendar year when the individual covered by

30  such plan is enrolled in and maintains participation in any

31  health wellness, maintenance, or improvement program approved

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 1  by the health plan. The individual must provide evidence of

 2  demonstrative maintenance or improvement of his or her health

 3  status as determined by assessments of agreed-upon health

 4  status indicators between the individual and the health

 5  insurer, including, but not limited to, reduction in weight,

 6  body mass index, and smoking cessation. Any rebate provided by

 7  the health insurer is presumed to be appropriate unless

 8  credible data demonstrates otherwise, but shall not exceed 10

 9  percent of paid premiums.

10         (b)  The premium rebate authorized by this section

11  shall be effective for an insured on an annual basis, unless

12  the individual fails to maintain or improve his or her health

13  status while participating in an approved wellness program, or

14  credible evidence demonstrates that the individual is not

15  participating in the approved wellness program.

16         Section 35.  Notwithstanding the amendment to section

17  627.6699(5)(c), Florida Statutes, by this act, any right to an

18  open enrollment offer of health benefit coverage for groups of

19  fewer than two employees, pursuant to section 627.6699(5)(c),

20  Florida Statutes, as it existed immediately before the

21  effective date of this act, shall remain in full force and

22  effect until the enactment of section 627.64872, Florida

23  Statutes, and the subsequent date upon which such plan begins

24  to accept new risks or members.

25         Section 36.  Section 465.0244, Florida Statutes, is

26  created to read:

27         465.0244  Information disclosure.--Every pharmacy shall

28  make available on its Internet website a link to the

29  performance outcome and financial data that is published by

30  the Agency for Health Care Administration pursuant to s.

31  408.05(3)(l) and shall place in the area where customers

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 1  receive filled prescriptions notice that such information is

 2  available electronically and the address of its Internet

 3  website.

 4         Section 37.  Section 627.6499, Florida Statutes, is

 5  amended to read:

 6         627.6499  Reporting by insurers and third-party

 7  administrators.--

 8         (1)  The office may require any insurer, third-party

 9  administrator, or service company to report any information

10  reasonably required to assist the board in assessing insurers

11  as required by this act.

12         (2)  Each health insurance issuer shall make available

13  on its Internet website a link to the performance outcome and

14  financial data that is published by the Agency for Health Care

15  Administration pursuant to s. 408.05(3)(l) and shall include

16  in every policy delivered or issued for delivery to any person

17  in the state or any materials provided as required by s.

18  627.64725 notice that such information is available

19  electronically and the address of its Internet website.

20         Section 38.  Subsections (6) and (7) are added to

21  section 641.54, Florida Statutes, to read:

22         641.54  Information disclosure.--

23         (6)  Each health maintenance organization shall make

24  available to its subscribers the estimated co-pay,

25  coinsurance, or deductible, whichever is applicable, for any

26  covered services, the status of the subscriber's maximum

27  annual out-of-pocket payments for a covered individual or

28  family, and the status of the subscriber's maximum lifetime

29  benefit. Such estimate shall not preclude the actual co-pay,

30  coinsurance, or deductible, whichever is applicable, from

31  exceeding the estimate.

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 1         (7)  Each health maintenance organization shall make

 2  available on its Internet website a link to the performance

 3  outcome and financial data that is published by the Agency for

 4  Health Care Administration pursuant to s. 408.05(3)(l) and

 5  shall include in every policy delivered or issued for delivery

 6  to any person in the state or any materials provided as

 7  required by s. 627.64725 notice that such information is

 8  available electronically and the address of its Internet

 9  website.

10         Section 39.  Section 408.02, Florida Statutes, is

11  repealed.

12         Section 40.  Subsection (3) of section 766.1016,

13  Florida Statutes, is repealed.

14         Section 41.  The sum of $250,000 is appropriated from

15  the Insurance Regulatory Trust Fund in the Department of

16  Financial Services to the Office of Insurance Regulation for

17  the purpose of implementing the provisions in this act

18  relating to the Small Employers Access Program.

19         Section 42.  The sum of $350,000 in nonrecurring

20  general revenue funds is appropriated to the Agency for Health

21  Care Administration to support the establishment of and to

22  contract with the Florida Patient Safety Corporation to

23  implement the provisions of section 16 of this act during the

24  2004-2005 fiscal year.

25         Section 43.  The sum of $113,500 in nonrecurring

26  general revenue funds is appropriated to the Florida State

27  University College of Medicine for the purpose of conducting

28  the study required in section 17 of this act during the

29  2004-2005 fiscal year.

30         Section 44.  The sum of $250,000 in nonrecurring

31  general funds is appropriated to the board of the Florida

                                 117

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    Florida Senate - 2004                    CS for CS for SB 2910
    311-2442-04




 1  Health Insurance Plan to contract for an independent actuarial

 2  study for the interim report that the board is required to

 3  submit pursuant to section 627.64872, Florida Statutes, as

 4  created by this act.

 5         Section 45.  The sum of $2 million in nonrecurring

 6  general revenue funds is appropriated to the Agency for Health

 7  Care Administration for its activities during the 2004-2005

 8  fiscal year related to developing and implementing a strategy

 9  for the adoption and use of electronic health records.

10         Section 46.  Except as otherwise expressly provided in

11  this act, this act shall take effect July 1, 2004.

12  

13  

14  

15  

16  

17  

18  

19  

20  

21  

22  

23  

24  

25  

26  

27  

28  

29  

30  

31  

                                 118

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    Florida Senate - 2004                    CS for CS for SB 2910
    311-2442-04




 1          STATEMENT OF SUBSTANTIAL CHANGES CONTAINED IN
                       COMMITTEE SUBSTITUTE FOR
 2                          CS for SB 2910

 3                                 

 4  Revises requirements for health care facilities to publish the
    average cost of certain services.
 5  
    Requires health care facilities, providers, and health
 6  insurers to submit data to the Agency for Health Care
    Administration (AHCA) and for AHCA to make performance outcome
 7  and financial data available to consumers.

 8  Revises the requirements for the Florida Health Insurance
    Plan.
 9  
    Revises requirements for the Health Flex Program, which is
10  expanded statewide.

11  Provides that policies for small employers with 26 to 50
    employees would no longer be subject to the modified community
12  rating requirements and the rates for such policies would not
    be required to be filed with or approved by the Office of
13  Insurance Regulation.

14  Revises requirements for small group policies.

15  Requires persons who provide access to any discounted medical
    services to be licensed by the Office of Insurance Regulation.
16  
    Require health insurers to provide for a rebate of premiums
17  when the majority of members of a health plan have maintained
    participation in a wellness program.
18  
    Creates the Florida Patient Safety Corporation to assist
19  health care providers to improve the quality and safety of
    health care rendered and to reduce harm to patients.
20  
    Requires the Patient Safety Center at the Florida State
21  University College of Medicine to conduct a study on
    hospitals.
22  
    Requires patient safety officers and patient safety committees
23  at licensed facilities to recommend improvements in the
    patient safety measures.
24  
    Requires AHCA to develop and implement a strategy for the
25  adoption and use of electronic health records.

26  Allows hospitals and federally quality health centers to
    develop emergency room diversion programs.
27  
    Renames the Statewide Provider and Subscriber Assistance
28  Program as the Subscriber Assistance Program and revises
    requirements for the program.
29  
    Makes appropriations.
30  

31  

                                 119

CODING: Words stricken are deletions; words underlined are additions.

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