Assembly Bill No. 27-Committee on Health and Human Services
Prefiled on January 16, 1997
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Referred to Committee on Health and Human Services
SUMMARY--Prohibits certain entities that issue policies of health insurance which provide health care services through managed care from engaging in certain practices. (BDR 57-998)
FISCAL NOTE: Effect on Local Government: No.
Effect on the State or on Industrial Insurance: No.
EXPLANATION - Matter in italics is new; matter in brackets [ ] is material to be omitted.
AN ACT relating to health care; prohibiting certain entities that issue policies of health insurance which provide health care services through managed care from engaging in certain practices that restrict the actions of a provider of health care; prohibiting such entities from offering or paying an incentive to a provider of health care to induce the provider to deny, limit or delay medically necessary treatment to an insured; and providing other matters properly relating thereto.
THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:
Section 1 Chapter 687B of NRS is hereby amended by adding thereto the provisions set forth as sections 2 to 8, inclusive, of this act.
Sec. 2 As used in sections 2 to 8, inclusive, of this act, unless the context otherwise requires, the words and terms defined in sections 3 to 6, inclusive, of this act have the meanings ascribed to them in those sections.
Sec. 3 "Managed care" means a method of providing or arranging for the provision of health care services, other than a method based on fee-for-service wherein an insurer:
1. Reimburses a provider of health care for each service provided to an insured;
2. Allows an insured to choose any provider of health care and does not encourage the use of any specific provider of health care; and
3. Does not require any preauthorization or referral for a specific service to be covered.
The term includes, without limitation, a health maintenance organization, preferred provider organization, point-of-service plan or exclusive provider organization.
Sec. 4 "Managed care organization" means an organization that provides managed care.
Sec. 5 "Primary care physician" means a physician whose responsibilities include, without limitation, providing initial and primary health care services to an insured, maintaining the continuity of care for the insured and referring the insured to a specialist when necessary.
Sec. 6 "Provider of health care" means any physician, hospital or other person who is licensed or otherwise authorized in this state to furnish any health care service.
Sec. 7 1. No insurer that issues a policy of health insurance which provides health care services through managed care or managed care organization may restrict or interfere with any communication between a provider of health care and:
(a) A current, former or prospective insured, or the guardian or legal representative of such an insured;
(b) An employee or representative of the insurer; or
(c) An employee or representative of any state or federal authority with responsibility for the licensing or oversight of the insurer,
regarding the health care needs or treatment of an insured or the provisions, terms or requirements of the policy or another policy.
2. A communication pursuant to subsection 1 includes, without limitation, a communication regarding:
(a) A test, consultation or option for treatment;
(b) A risk or benefit associated with such a test, consultation or option for treatment;
(c) The experience, quality of care or ability of any provider of health care, insurer or managed care organization;
(d) The basis, standard or process used by the provider of health care, insurer or managed care organization to authorize or deny a health care service; and
(e) Any financial incentive offered to the provider of health care for using or restricting the use of certain medical treatments or procedures.
3. Nothing in this section authorizes a knowing and willful misrepresentation by a provider of health care.
Sec. 8 No insurer that issues a policy of health insurance which provides health care services through managed care or managed care organization may:
1. Terminate a contract with, refuse to contract with, refuse to compensate or otherwise penalize a provider of health care solely because the provider:
(a) Engages in any communication referred to in section 7 of this act;
(b) Expresses disagreement with a decision of the insurer or managed care organization to deny or limit a particular health care service to an insured; or
(c) Assists an insured in seeking reconsideration of a decision by the insurer or managed care organization to deny a particular health care service.
2. Prohibit or restrict a provider from filing a complaint, making a report or commenting to an appropriate governmental body regarding the policies or practices of the insurer or managed care organization.
3. Offer or pay a bonus, provide an incentive or other financial compensation, directly or indirectly, to a provider of health care as an inducement to deny, limit or delay medically necessary services to an insured.
Sec. 9 NRS 695C.055 is hereby amended to read as follows:
695C.0551. The provisions of NRS 449.465, 679B.158 and 680B.025 to 680B.060, inclusive, subsections 2, 4, 18, 19 and 32 of NRS 680B.010 and NRS 689C.015 to 689C.350, inclusive, and sections 2 to 8, inclusive, of this act apply to a health maintenance organization.
2. For the purposes of subsection 1, unless the context requires that a provision apply only to insurers, any reference in those sections to "insurer" must be replaced by "health maintenance organization.