H.F. 2483 DIVISION I 1 HEALTHY AND WELL KIDS IN IOWA —— DIRECTOR DUTIES 2 Section 1. Section 514I.4, subsection 5, Code 2018, is 3 amended by adding the following new paragraphs: 4 NEW PARAGRAPH . d. Collect and track monthly family premiums 5 to assure that payments are current. 6 NEW PARAGRAPH . e. Verify the number of program enrollees 7 with each participating insurer for determination of the amount 8 of premiums to be paid to each participating insurer. 9 Sec. 2. Section 514I.7, subsection 2, paragraphs g and i, 10 Code 2018, are amended by striking the paragraphs. 11 DIVISION II 12 SHARING OF INCARCERATION DATA 13 Sec. 3. Section 249A.38, Code 2018, is amended to read as 14 follows: 15 249A.38 Inmates of public institutions —— suspension or 16 termination of medical assistance. 17 1. The following conditions shall apply to Following the 18 first thirty days of commitment, the department shall suspend 19 the eligibility of an individual who is an inmate of a public 20 institution as defined in 42 C.F.R. §435.1010 , who is enrolled 21 in the medical assistance program at the time of commitment to 22 the public institution, and who remains eligible for medical 23 assistance as an individual except for the individual’s 24 institutional status : 25 a. The department shall suspend the individual’s 26 eligibility for up to the initial twelve months of the period 27 of commitment. The department shall delay the suspension 28 of eligibility for a period of up to the first thirty days 29 of commitment if such delay is approved by the centers for 30 Medicare and Medicaid services of the United States department 31 of health and human services. If such delay is not approved, 32 the department shall suspend eligibility during the entirety 33 of the initial twelve months of the period of commitment. 34 Claims submitted on behalf of the individual under the medical 35 -1- LSB 6226HV (3) 87 pf/rh 1/ 10

H.F. 2483 assistance program for covered services provided during the 1 delay period shall only be reimbursed if federal financial 2 participation is applicable to such claims. 3 b. The department shall terminate an individual’s 4 eligibility following a twelve-month period of suspension 5 of the individual’s eligibility under paragraph “a” , during 6 the period of the individual’s commitment to the public 7 institution . 8 2. a. A public institution shall provide the department and 9 the social security administration with a monthly report of the 10 individuals who are committed to the public institution and of 11 the individuals who are discharged from the public institution. 12 The monthly report to the department shall include the date 13 of commitment or the date of discharge, as applicable, of 14 each individual committed to or discharged from the public 15 institution during the reporting period. The monthly report 16 shall be made through the reporting system created by the 17 department for public, nonmedical institutions to report inmate 18 populations. Any medical assistance expenditures, including 19 but not limited to monthly managed care capitation payments, 20 provided on behalf of an individual who is an inmate of a 21 public institution but is not reported to the department 22 in accordance with this subsection, shall be the financial 23 responsibility of the respective public institution. 24 b. The department shall provide a public institution with 25 the forms necessary to be used by the individual in expediting 26 restoration of the individual’s medical assistance benefits 27 upon discharge from the public institution. 28 3. This section applies to individuals as specified in 29 subsection 1 on or after January 1, 2012. 30 4. 3. The department may adopt rules pursuant to chapter 31 17A to implement this section. 32 DIVISION III 33 MEDICAID PROGRAM ADMINISTRATION 34 Sec. 4. MEDICAID PROGRAM ADMINISTRATION. 35 -2- LSB 6226HV (3) 87 pf/rh 2/ 10

H.F. 2483 1. PROVIDER PROCESSES AND PROCEDURES. 1 a. When all of the required documents and other information 2 necessary to process a claim have been received by a managed 3 care organization, the managed care organization shall 4 either provide payment to the claimant within the timelines 5 specified in the managed care contract or, if the managed 6 care organization is denying the claim in whole or in part, 7 shall provide notice to the claimant including the reasons for 8 such denial consistent with national industry best practice 9 guidelines. 10 b. If a managed care organization discovers that a claims 11 payment barrier is the result of a managed care organization’s 12 identified system configuration error, the managed care 13 organization shall correct such error and shall fully and 14 accurately reprocess the claims affected by the error within 15 thirty days of such discovery or within a time frame approved 16 by the department. For the purposes of this paragraph, 17 “configuration error” means an error in provider data, an 18 incorrect fee schedule, or an incorrect claims edit. 19 c. The department of human services shall provide for 20 the development and require the use of standardized Medicaid 21 provider enrollment forms to be used by the department and 22 uniform Medicaid provider credentialing standards to be used 23 by managed care organizations. The credentialing process is 24 deemed to begin when the managed care organization has received 25 all necessary credentialing materials from the provider and is 26 deemed to have ended when written communication is mailed or 27 faxed to the provider notifying the provider of the managed 28 care organization’s decision. 29 2. MEMBER SERVICES AND PROCESSES. 30 a. If a Medicaid member prevails on appeal regarding the 31 provision of services, the services subject to the appeal 32 shall be extended for a period of time determined by the 33 director of human services. However, services shall not be 34 extended if there is a change in the member’s condition that 35 -3- LSB 6226HV (3) 87 pf/rh 3/ 10

H.F. 2483 warrants a change in services as determined by the member’s 1 interdisciplinary team, there is a change in the member’s 2 eligibility status as determined by the department of human 3 services, or the member voluntarily withdraws from services. 4 b. If a Medicaid member is receiving court-ordered services 5 or treatment for a substance-related disorder pursuant to 6 chapter 125 or for a mental illness pursuant to chapter 229, 7 such services or treatment shall be provided and reimbursed 8 for an initial period of three days before a managed care 9 organization may apply medical necessity criteria to determine 10 the most appropriate services, treatment, or placement for the 11 Medicaid member. 12 c. The department of human services shall review and have 13 approval authority for level of care reassessments for Medicaid 14 long-term services and supports (LTSS) population members that 15 indicate a decrease in the level of care. A managed care 16 organization shall comply with the findings of the departmental 17 review and approval of such level of care reassessments. If 18 a level of care reassessment indicates there is no change in 19 a Medicaid LTSS population member’s level of care needs, the 20 Medicaid LTSS population member’s existing level of care shall 21 be continued. A managed care organization shall maintain 22 and make available to the department of human services all 23 documentation relating to a Medicaid LTSS population member’s 24 level of care assessment. 25 d. The department of human services shall maintain and 26 update Medicaid member eligibility files in a timely manner 27 consistent with national industry best practices. 28 3. MEDICAID PROGRAM REVIEW AND OVERSIGHT. 29 a. (1) The department of human services shall facilitate a 30 workgroup, in collaboration with representatives of the managed 31 care organizations and health home providers, to review the 32 health home programs. The review shall include all of the 33 following: 34 (a) An analysis of the state plan amendments applicable to 35 -4- LSB 6226HV (3) 87 pf/rh 4/ 10

H.F. 2483 health homes. 1 (b) An analysis of the current health home system, including 2 the rationale for any recommended changes. 3 (c) The development of a clear and consistent delivery 4 model linked to program-determined outcomes and data reporting 5 requirements. 6 (d) A work plan to be used in communicating with 7 stakeholders regarding the administration and operation of the 8 health home programs. 9 (2) The department of human services shall submit a report 10 of the workgroup’s findings and recommendations by December 11 15, 2018, to the governor and to the Eighty-eighth General 12 Assembly, 2019 session, for consideration. 13 (3) The workgroup and the workgroup’s activities shall 14 not affect the department’s authority to apply or enforce the 15 Medicaid state plan amendment relative to health homes. 16 b. The department of human services, in collaboration 17 with Medicaid providers and managed care organizations, shall 18 initiate a review process to determine the effectiveness of 19 prior authorizations used by the managed care organizations 20 with the goal of making adjustments based on relevant 21 service costs and member outcomes data utilizing existing 22 industry-accepted standards. Prior authorization policies 23 shall comply with existing rules, guidelines, and procedures 24 developed by the centers for Medicare and Medicaid services of 25 the United States department of health and human services. 26 c. The department of human services shall enter into a 27 contract with an independent auditor to perform an audit of a 28 random sample of small dollar claims paid to or denied Medicaid 29 long-term services and supports providers during the first 30 quarter of the 2018 calendar year. The department of human 31 services shall submit a report of the findings of the audit to 32 the governor and the general assembly by December 15, 2018. 33 The department may take any action specified in the managed 34 care contract relative to any claim the auditor determines to 35 -5- LSB 6226HV (3) 87 pf/rh 5/ 10

H.F. 2483 be incorrectly paid or denied, subject to appeal by the managed 1 care organization to the director of human services. For the 2 purposes of this paragraph, “small dollar claims” means those 3 claims less than or equal to two thousand five hundred dollars. 4 DIVISION IV 5 MEDICAID PROGRAM PHARMACY COPAYMENT 6 Sec. 5. 2005 Iowa Acts, chapter 167, section 42, is amended 7 to read as follows: 8 SEC. 42. COPAYMENTS FOR PRESCRIPTION DRUGS UNDER THE 9 MEDICAL ASSISTANCE PROGRAM. The department of human services 10 shall require recipients of medical assistance to pay the 11 following copayments a copayment of $1 on each prescription 12 filled for a covered prescription drug, including each refill 13 of such prescription , as follows: 14 1. A copayment of $1 on each prescription filled for each 15 covered nonpreferred generic prescription drug . 16 2. A copayment of $1 for each covered preferred brand–name 17 or generic prescription drug. 18 3. A copayment of $1 for each covered nonpreferred 19 brand–name prescription drug for which the cost to the state is 20 up to and including $25. 21 4. A copayment of $2 for each covered nonpreferred 22 brand–name prescription drug for which the cost to the state is 23 more than $25 and up to and including $50. 24 5. A copayment of $3 for each covered nonpreferred 25 brand–name prescription drug for which the cost to the state 26 is more than $50. 27 DIVISION V 28 MEDICAL ASSISTANCE ADVISORY COUNCIL 29 Sec. 6. Section 249A.4B, subsection 2, paragraph a, 30 subparagraphs (27) and (28), Code 2018, are amended by striking 31 the subparagraphs. 32 Sec. 7. MEDICAL ASSISTANCE ADVISORY COUNCIL —— REVIEW OF 33 MEDICAID MANAGED CARE REPORT DATA. The executive committee 34 of the medical assistance advisory council shall review 35 -6- LSB 6226HV (3) 87 pf/rh 6/ 10

H.F. 2483 the data collected and analyzed for inclusion in periodic 1 reports to the general assembly, including but not limited 2 to the information and data specified in 2016 Iowa Acts, 3 chapter 1139, section 93, to determine which data points and 4 information should be included and analyzed to more accurately 5 identify trends and issues with, and promote the effective and 6 efficient administration of, Medicaid managed care for all 7 stakeholders. At a minimum, the areas of focus shall include 8 consumer protection, provider network access and safeguards, 9 outcome achievement, and program integrity. The executive 10 committee shall report its findings and recommendations to the 11 medical assistance advisory council for review and comment by 12 October 1, 2018, and shall submit a final report of findings 13 and recommendations to the governor and the general assembly by 14 December 31, 2018. 15 DIVISION VI 16 TARGETED CASE MANAGEMENT AND INPATIENT PSYCHIATRIC SERVICES 17 REIMBURSEMENT 18 Sec. 8. Section 249A.31, Code 2018, is amended to read as 19 follows: 20 249A.31 Cost-based reimbursement. 21 1. Providers of individual case management services for 22 persons with an intellectual disability, a developmental 23 disability, or chronic mental illness shall receive cost-based 24 reimbursement for one hundred percent of the reasonable 25 costs for the provision of the services in accordance with 26 standards adopted by the mental health and disability services 27 commission pursuant to section 225C.6 . Effective July 1, 2018, 28 targeted case management services shall be reimbursed based 29 on a statewide fee schedule amount developed by rule of the 30 department pursuant to chapter 17A. 31 2. Effective July 1, 2010 2014 , the department shall apply 32 a cost-based reimbursement methodology for reimbursement of 33 psychiatric medical institution for children providers of 34 inpatient psychiatric services for individuals under twenty-one 35 -7- LSB 6226HV (3) 87 pf/rh 7/ 10

H.F. 2483 years of age shall be reimbursed as follows: 1 a. For non-state-owned providers, services shall be 2 reimbursed according to a fee schedule without reconciliation . 3 b. For state-owned providers, services shall be reimbursed 4 at one hundred percent of the actual and allowable cost of 5 providing the service. 6 EXPLANATION 7 The inclusion of this explanation does not constitute agreement with 8 the explanation’s substance by the members of the general assembly. 9 This bill relates to programs and activities under the 10 purview of the department of human services (DHS). The bill is 11 organized into divisions. 12 Division I of the bill relates to the healthy and well 13 kids in Iowa (hawk-i) program by transferring two duties of 14 the administrative contractor, the capitation process and 15 member premium collection, to DHS through the Iowa Medicaid 16 enterprise. 17 Division II of the bill relates to suspension of Medicaid 18 relating to inmates of public institutions. The bill requires 19 DHS to suspend eligibility of an individual following the first 20 30 days of the individual’s commitment to the institution. The 21 bill also requires public institutions to provide a monthly 22 report of the individuals who are committed to the public 23 institution and of the individuals who are discharged from 24 the public institution to DHS and to the social security 25 administration. The report to DHS is required to include 26 the date of commitment or discharge, as applicable, of 27 each individual committed to or discharged from the public 28 institution during the reporting period, and the report is to 29 be made through the reporting system created by DHS for public, 30 nonmedical institutions to report inmate populations. Any 31 medical assistance expenditures, including but not limited to 32 monthly managed care capitation payments, provided on behalf of 33 an individual who is an inmate of a public institution but is 34 not reported as required, shall be the financial responsibility 35 -8- LSB 6226HV (3) 87 pf/rh 8/ 10

H.F. 2483 of the respective public institution. 1 Division III of the bill relates to Medicaid provider 2 processes and procedures, Medicaid member services and 3 processes, and Medicaid program review and oversight. 4 Division IV of the bill eliminates the various copayments 5 for a covered prescription drug under the Medicaid program 6 based upon the prescription drug’s status, and instead provides 7 that a recipient of Medicaid is required to pay a copayment of 8 $1 on each prescription filled for a covered prescription drug, 9 including each refill of such prescription. 10 Division V of the bill relates to the medical assistance 11 advisory council (MAAC). The bill directs the executive 12 committee of MAAC to review data collected and analyzed in 13 periodic reports to the general assembly to determine which 14 data points should be included and analyzed to more accurately 15 identify trends and issues with, and promote the effective and 16 efficient administration of, Medicaid managed care for all 17 stakeholders. The executive committee is required to report 18 its findings and recommendations to the MAAC for review and 19 comment by October 1, 2018, and to submit a final report to the 20 governor and the general assembly by December 31, 2018. 21 Division VI of the bill amends the reimbursement provision 22 for targeted case management services under the Medicaid 23 program which is currently established as cost-based 24 reimbursement for 100 percent of the reasonable costs for 25 provision of the services. Under the bill, effective July 26 1, 2018, targeted case management services will instead be 27 reimbursed based on a statewide fee schedule amount developed 28 by rule of the department in accordance with Code chapter 17A. 29 This division of the bill also amends the reimbursement 30 provision for psychiatric medical institutions for children to 31 provide that inpatient psychiatric services for individuals 32 under 21 years of age that are provided by non-state-owned 33 providers shall be reimbursed according to a fee schedule 34 without reconciliation and for state-owned providers shall be 35 -9- LSB 6226HV (3) 87 pf/rh 9/ 10