Senate File 2340 - Introduced SENATE FILE 2340 BY COMMITTEE ON HUMAN RESOURCES (SUCCESSOR TO SF 2221) A BILL FOR An Act relating to Medicaid managed care resolution of payment 1 and notice of change. 2 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 3 TLSB 5779SV (2) 87 pf/rh

S.F. 2340 Section 1. MEDICAID MANAGED CARE —— RESOLUTION OF PAYMENT 1 AND NOTICE OF CHANGE. The department of human services 2 shall adopt rules pursuant to chapter 17A and shall amend 3 all Medicaid managed care contracts, to require all of the 4 following: 5 1. For Medicaid provider claims ultimately found to be 6 incorrectly denied or underpaid through an appeals process or 7 audit, a managed care organization shall pay, in addition to 8 the amount determined to be owed, interest in an amount equal 9 to eighteen percent per annum on the total amount of the claim 10 ultimately authorized as calculated from fifteen days after the 11 date the claim was submitted. 12 2. A managed care organization shall provide written notice 13 to all affected individuals at least sixty days prior to a 14 change in administrative processes or procedures relating to 15 the scope or coverage of benefits, billings and collections 16 provisions, provider network provisions, member or provider 17 services, prior authorization requirements, or any other terms 18 of a managed care contract or agreement upon which an affected 19 individual relies under Medicaid managed care. A managed care 20 organization may comply with the requirement of providing 21 written notice under this subsection by posting such written 22 notice on the managed care organization’s internet site. 23 3. A managed care organization shall pay, contest, deny, or 24 settle a claim, in whole or in part, within forty-five business 25 days after receipt of the claim. If a claim is contested 26 or denied, the managed care organization shall, with as much 27 specificity as possible, identify the claim or portion of the 28 claim affected, provide an explanation and the reasons for 29 contesting or denying the claim, and provide the claimant with 30 instructions for appealing the contested or denied claim. 31 4. A managed care organization shall complete the internal 32 review process for any claim submitted within ninety business 33 days of receipt of the request for internal review. If the 34 first level of review is not completed within the ninety-day 35 -1- LSB 5779SV (2) 87 pf/rh 1/ 2

S.F. 2340 period, the claim shall be subject to contested case review 1 pursuant to chapter 17A, notwithstanding the fact that the 2 claimant has not exhausted the managed care organization’s 3 internal review process and received a final written 4 determination from the managed care organization. 5 EXPLANATION 6 The inclusion of this explanation does not constitute agreement with 7 the explanation’s substance by the members of the general assembly. 8 This bill requires the department of human services (DHS) 9 to adopt administrative rules and amend all Medicaid managed 10 care contracts to provide for compliance with certain notice 11 and payment requirements. 12 The bill requires an MCO to provide written notice to all 13 affected individuals at least 60 days prior to a change in any 14 term of a managed care contract or agreement upon which an 15 affected individual has relied under the Medicaid managed care 16 program. An MCO may comply with the notice requirements by 17 posting the written notice on the MCO’s internet site. 18 The bill requires an MCO to pay, contest, or deny a claim, 19 in whole or in part, within 45 business days after receipt of 20 the claim. If a claim is contested or denied, the managed 21 care organization shall, with as much specificity as possible, 22 identify the claim or portion of the claim affected, provide 23 an explanation and the reasons for contesting or denying the 24 claim, and provide the claimant with instruction for appeal of 25 the claim. 26 The bill requires an MCO to complete the internal review 27 process for any claim submitted within 90 business days of 28 receipt of the request for internal review. If the internal 29 review is not completed within the 90-day period, the claim is 30 subject to contested case review pursuant to Code chapter 17A, 31 notwithstanding the fact that the claimant has not exhausted 32 the managed care organization’s internal review process and 33 received a final written determination from the MCO. 34 -2- LSB 5779SV (2) 87 pf/rh 2/ 2