Senate File 505 H-1356 Amend the amendment, H-1345, to Senate File 505, 1 as amended, passed, and reprinted by the Senate, as 2 follows: 3 1. Page 72, after line 20 by inserting: 4 < DIVISION ___ 5 HEALTH POLICY —— OVERSIGHT 6 Sec. ___. NEW SECTION . 2.70 Legislative health 7 policy oversight committee. 8 1. A legislative health policy oversight committee 9 is created to provide a formal venue for oversight of 10 and stakeholder engagement in, the design, development, 11 implementation, administration, and funding associated 12 with general state health care policy, with a 13 particular focus on the Medicaid program. The overall 14 purpose of the committee is to ensure that health care 15 policy in this state is consumer-focused and provides 16 for accessible, accountable, efficient, cost-effective, 17 and quality health care. The goal of the committee 18 is to continue to further health policy that improves 19 health care, improves population health, reduces health 20 care costs, and integrates medical and social services 21 and supports into a holistic health system. 22 2. a. The committee shall include all of the 23 following members: 24 (1) The co-chairpersons and ranking members of 25 the legislative joint appropriations subcommittee 26 on health and human services, or members of the 27 joint appropriations subcommittee designated by the 28 respective co-chairpersons or ranking members. 29 (2) The chairpersons and ranking members of the 30 human resources committees of the senate and house 31 of representatives, or members of the respective 32 committees designated by the respective chairpersons 33 or ranking members. 34 (3) The chairpersons and ranking members of the 35 appropriations committees of the senate and house 36 of representatives, or members of the respective 37 committees designated by the respective chairpersons 38 or ranking members. 39 b. The members of the committee shall receive a per 40 diem as provided in section 2.10. 41 c. The committee shall meet at least quarterly, 42 but may meet as often as necessary. The committee may 43 request information from sources as deemed appropriate, 44 and the department of human services and other agencies 45 of state government shall provide information to the 46 committee as requested. The legislative services 47 agency shall provide staff support to the committee. 48 d. The committee shall select co-chairpersons, one 49 representing the senate and one representing the house 50 -1- H1345.1985 (4) 86 pf/sc 1/ 7 #1.

of representatives, annually, from its membership. 1 A majority of the members of the committee shall 2 constitute a quorum. 3 e. The committee may contract for the services of 4 persons who are qualified by education, expertise, or 5 experience to advise, consult with, or otherwise assist 6 the committee in the performance of its duties. 7 3. The committee shall submit a report to the 8 governor and the general assembly by December 15, 9 annually. 10 Sec. ___. NEW SECTION . 231.44 Utilization 11 of resources —— assistance and advocacy related to 12 long-term services and supports under the Medicaid 13 program. 14 1. The office of long-term care ombudsman may 15 utilize its available resources to provide assistance 16 and advocacy services to potential or actual 17 recipients, or the families or legal representatives 18 of such potential or actual recipients, of long-term 19 services and supports provided through the Medicaid 20 program. Such assistance and advocacy shall include 21 but is not limited to all of the following: 22 a. Providing information, education, consultation, 23 and assistance regarding eligibility for, enrollment 24 in, and the obtaining of long-term services and 25 supports through the Medicaid program. 26 b. Identifying and referring individuals who may 27 be eligible for and in need of long-term services and 28 supports to the Medicaid program. 29 c. Developing procedures for tracking and reporting 30 individual requests for assistance with the obtaining 31 of necessary services and supports. 32 d. Providing consultation for individuals 33 transitioning into or out of an institutional setting 34 or across levels of care. 35 e. Identifying gaps in or duplication of services 36 provided to older individuals and persons with 37 disabilities and developing strategies to improve the 38 delivery and coordination of these services for these 39 individuals. 40 f. Providing advice, assistance, and negotiation 41 relating to the preparation and filing of complaints, 42 grievances, and appeals of complaints or grievances 43 relating to long-term services and supports under the 44 Medicaid program. 45 g. Providing individual case advocacy services in 46 administrative hearings and legal representation for 47 judicial proceedings related to long-term services and 48 supports under the Medicaid program. 49 2. A representative of the office of long-term care 50 -2- H1345.1985 (4) 86 pf/sc 2/ 7

ombudsman providing assistance and advocacy services 1 authorized under this section for an individual, 2 shall be provided access to the individual, and shall 3 be provided access to the individual’s medical and 4 social records as authorized by the individual or the 5 individual’s legal representative, as necessary to 6 carry out the duties specified in this section. 7 3. A representative of the office of long-term care 8 ombudsman providing assistance and advocacy services 9 authorized under this section for an individual, shall 10 be provided access to administrative records related to 11 the provision of the long-term services and supports to 12 the individual, as necessary to carry out the duties 13 specified in this section. 14 4. For the purposes of this section: 15 a. “Institutional setting” includes a long-term care 16 facility, an elder group home, or an assisted living 17 program. 18 b. “Long-term services and supports” means the broad 19 range of health, health-related, and personal care 20 assistance services and supports, provided in both 21 institutional settings and home and community-based 22 settings, necessary for older individuals and persons 23 with disabilities who experience limitations in their 24 capacity for self-care due to a physical, cognitive, or 25 mental disability or condition. 26 Sec. ___. MEDICAID MANAGED CARE ORGANIZATIONS —— 27 UTILIZATION OF ACTUARILY SOUND CAPITATION PAYMENTS. 28 1. All of the following shall apply to Medicaid 29 managed care contracts and to the actuarily sound 30 Medicaid capitation payments under such contracts 31 entered into on or after July 1, 2015: 32 a. Up to 2 percent of the actuarily sound Medicaid 33 capitation payment amount specified under the contract 34 shall be withheld by the state to be used to provide 35 for Medicaid program oversight, including for a 36 health consumer ombudsman function, and for quality 37 improvement. 38 b. The minimum medical loss ratio applicable to 39 Medicaid managed care shall be established at no less 40 than 85 percent. The portion of the actuarily sound 41 Medicaid capitation payment paid to a Medicaid managed 42 care contractor that is required to be dedicated 43 to meeting the minimum medical loss ratio shall be 44 allocated to a Medicaid claims fund. Expenditures of 45 moneys in the Medicaid claims fund shall comply with 46 all of the following: 47 (1) Only expenditures for medical claims shall be 48 considered in computing the minimum medical loss ratio 49 as specified in the contract. For the purposes of the 50 -3- H1345.1985 (4) 86 pf/sc 3/ 7

computation, “medical claims” means only the costs of 1 claims for direct delivery of covered benefits incurred 2 during the applicable minimum medical loss ratio 3 reporting period, not otherwise defined or designated 4 as administrative costs, population health benefits or 5 quality improvement, or profit in this section. 6 (2) If a Medicaid managed care contractor does not 7 meet the minimum medical loss ratio established under 8 the contract for the reporting period specified, the 9 Medicaid managed care contractor shall remit the excess 10 amount, multiplied by the total contract revenue, to 11 the state for community reinvestment, oversight, and 12 quality improvement. 13 c. The portion of the actuarily sound Medicaid 14 capitation payment that is not required to be dedicated 15 to meeting the minimum medical loss ratio, shall be 16 allocated to an administrative fund. Expenditure or 17 use of moneys in the administrative fund shall comply 18 with all of the following: 19 (1) Funds in the administrative fund may be 20 used for population health and quality improvement 21 activities including conflict free case management, 22 care coordination, community benefit expenditures, 23 nontraditional consumer-centered services that address 24 social determinants of health, health information 25 technology, data collection and analysis, and other 26 population health and quality improvement activities as 27 specified by rule of the department of human services. 28 (2) Administrative costs shall not exceed the 29 percentage applicable to the Medicaid program 30 for administrative costs for FY 2015 of a maximum 31 of 4 percent calculated as a percentage of the 32 actuarily sound Medicaid capitation payment during 33 the applicable minimum medical loss ratio reporting 34 period. Administrative functions and costs shall not 35 be shifted to providers or other entities as a means of 36 administrative cost avoidance. 37 (3) Profit, including reserves and earnings on 38 reserves such as investment income and earned interest, 39 as a percentage of the actuarily sound Medicaid 40 capitation payment, shall be limited to a maximum of 41 3 percent during the applicable minimum medical loss 42 ratio reporting period. 43 (4) Any funds remaining in the administrative fund 44 following allowable expenditures or uses specified in 45 subparagraphs (1), (2), and (3) shall be remitted to 46 the state for community reinvestment, oversight, and 47 quality improvement. 48 2. The department of human services shall specify 49 by rule reporting requirements for Medicaid managed 50 -4- H1345.1985 (4) 86 pf/sc 4/ 7

care contractors under this section. 1 Sec. ___. PROPOSAL FOR A HEALTH CONSUMER OMBUDSMAN 2 ALLIANCE. The office of long-term care ombudsman 3 shall collaborate with the department on aging, the 4 office of substitute decision maker, the department of 5 veterans affairs, the department of human services, 6 the department of public health, the department of 7 inspections and appeals, the designated protection 8 and advocacy agency as provided in section 135C.2, 9 subsection 4, the civil rights commission, the senior 10 health insurance information program, the Iowa 11 insurance consumer advocate, Iowa legal aid, and other 12 consumer advocates and consumer assistance programs, 13 to develop a proposal for the establishment of a 14 health consumer ombudsman alliance. The purpose of 15 the alliance is to provide a permanent coordinated 16 system of independent consumer supports to ensure 17 that consumers, including consumers covered under 18 Medicaid managed care, obtain and maintain essential 19 health care, are provided unbiased information in 20 understanding coverage models, and are assisted in 21 resolving problems regarding health care services, 22 coverage, access, and rights. The proposal developed 23 shall include annual budget projections and shall be 24 submitted to the governor and the general assembly no 25 later than December 15, 2015. 26 Sec. ___. FUNCTIONAL, LEVEL OF CARE, AND 27 NEEDS-BASED ASSESSMENTS —— CASE MANAGEMENT. 28 1. The department of human services shall contract 29 with a conflict free third party to conduct initial 30 and subsequent functional, level of care, and needs 31 assessments and reassessments of consumers who may be 32 eligible for long-term services and supports and are 33 subject to a Medicaid managed care contract. Such 34 assessments and reassessments shall not be completed 35 by a Medicaid managed care organization under contract 36 with the state or by any entity that is not deemed 37 conflict free. If a managed care contractor becomes 38 aware that an applicant may require long-term services 39 and supports or that an enrolled consumer’s functional 40 level of care, support needs, or medical status has 41 changed, the Medicaid managed care contractor shall 42 notify the department and the conflict free third 43 party shall administer any assessment or reassessment 44 in response to the notification. A case manager 45 or Medicaid managed care contractor shall not alter 46 a consumer’s service plan independent of the prior 47 administration of an assessment or reassessment 48 conducted by the conflict free third party. The 49 department of human services shall retain authority 50 -5- H1345.1985 (4) 86 pf/sc 5/ 7

to determine or redetermine a consumer’s categorical, 1 financial, level of care or needs-based eligibility 2 based on the conflict free third party assessment or 3 reassessment. 4 2. The department of human services shall provide 5 for administration of non-biased, community-based, 6 in-person options counseling by a conflict free third 7 party for applicants for a Medicaid managed care plan. 8 3. Case management under a Medicaid managed care 9 contract shall be administered in a conflict free 10 manner. 11 4. For the purposes of this section, “conflict 12 free” means conflict free pursuant to specifications of 13 the balancing incentive program requirements. 14 Sec. ___. EFFECTIVE UPON ENACTMENT. This division 15 of this Act, being deemed of immediate importance, 16 takes effect upon enactment. 17 Sec. ___. CONTINGENT IMPLEMENTATION. 18 Implementation of this division of this Act is 19 contingent upon receipt of approval from the centers 20 for Medicare and Medicaid services of the United States 21 department of health and human services of the Medicaid 22 waivers necessary to implement Medicaid managed 23 care under the governor’s Medicaid modernization 24 initiative. > 25 2. By renumbering, redesignating, and correcting 26 internal references as necessary. 27 ______________________________ HEDDENS of Story ______________________________ DUNKEL of Dubuque ______________________________ HALL of Woodbury ______________________________ HANSON of Jefferson ______________________________ LENSING of Johnson -6- H1345.1985 (4) 86 pf/sc 6/ 7 #2.