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H0742aa...............................................by HEALTH AND WELFARE
MEDICAL ASSISTANCE - Adds to existing law to provide a statement of
legislative findings, to establish requirements for documentation of
medical assistance services, to provide for suspension of payments or
provider agreements, to provide for recovery of payments for medical
assistance services, to provide penalties for abuse and fraud, to provide
for termination of provider agreements and to provide for exclusion from
participation as a provider.
02/17 House intro - 1st rdg - to printing
02/18 Rpt prt - to Health/Wel
03/05 Rpt out - to Gen Ord
03/06 Rpt out amen - to engros
03/09 Rpt engros - 1st rdg - to 2nd rdg as amen
03/10 2nd rdg - to 3rd rdg as amen
03/11 3rd rdg as amen - PASSED 59-1-10
AYES -- Barraclough, Barrett, Bell, Bieter, Bivens, Black(15),
Black(23), Boe, Callister, Campbell, Chase, Clark, Crane, Deal,
Denney, Ellsworth, Field(13), Gagner, Geddes, Gould, Hadley, Hansen,
Henbest, Hornbeck, Jaquet, Jones(9), Jones(22), Jones(20), Judd,
Kellogg, Kendell, Kjellander, Kunz, Lake, Loertscher, Marley,
McKague, Meyer, Miller, Pischner, Pomeroy, Reynolds, Richman,
Ridinger, Robison, Sali, Schaefer, Stevenson, Stoicheff, Stone,
Taylor, Tilman, Tippets, Trail, Watson, Wheeler, Wood, Zimmermann,
Mr Speaker
NAYS -- Mader
Absent and excused -- Alltus, Bruneel, Crow, Cuddy, Field(20),
Kempton, Linford, Mortensen, Newcomb, Stubbs
Floor Sponsor - Black(23)
Title apvd - to Senate
03/12 Senate intro - 1st rdg as amen - to Health/Wel
03/17 Rpt out - rec d/p - to 2nd rdg as amen
03/18 2nd rdg - to 3rd rdg as amen
03/19 3rd rdg as amen - PASSED - 35-0-0
AYES -- Andreason, Boatright, Branch, Bunderson, Burtenshaw, Cameron,
Crow, Danielson, Darrington, Diede, Dunklin, Frasure, Geddes, Hansen,
Hawkins, Ingram, Ipsen, Keough, King, Lee, McLaughlin, Noh, Parry,
Richardson, Riggs, Risch, Sandy, Schroeder, Sorensen, Stennett,
Sweeney, Thorne, Twiggs, Wheeler, Whitworth
NAYS -- None
Absent and excused -- None
Floor Sponsor - Crow
Title apvd - to House
03/20 To enrol - rpt enrol - Sp signed
Pres signed - to Governor
03/24 Governor signed
Session Law Chapter 311
Effective: 07/01/98
H0742|||| LEGISLATURE OF THE STATE OF IDAHO |||| Fifty-fourth Legislature Second Regular Session - 1998IN THE HOUSE OF REPRESENTATIVES HOUSE BILL NO. 742, As Amended BY HEALTH AND WELFARE COMMITTEE 1 AN ACT 2 RELATING TO MEDICAL ASSISTANCE PROGRAMS; TO PROVIDE A STATEMENT OF LEGISLATIVE 3 FINDINGS; AND AMENDING CHAPTER 2, TITLE 56, IDAHO CODE, BY THE ADDITION OF 4 A NEW SECTION 56-209h, IDAHO CODE, TO DEFINE TERMS, TO ESTABLISH REQUIRE- 5 MENTS FOR DOCUMENTATION OF MEDICAL ASSISTANCE SERVICES, TO PROVIDE FOR 6 SUSPENSION OF PAYMENTS OR PROVIDER AGREEMENT, TO PROVIDE FOR RECOVERY OF 7 PAYMENTS FOR MEDICAL ASSISTANCE SERVICES, TO PROVIDE TERMINATION OF PRO- 8 VIDER AGREEMENTS, TO PROVIDE FOR PENALTIES FOR ABUSE AND FRAUD AND TO PRO- 9 VIDE EXCLUSION FROM PARTICIPATION AS A PROVIDER. 10 Be It Enacted by the Legislature of the State of Idaho: 11 SECTION 1. FINDINGS. The legislature finds that provider fraud and abuse 12 in medical assistance programs is a potential problem which demands effective 13 administrative remedies. This act is intended to provide explicit authority to 14 the Department of Health and Welfare to establish conditions of payments, to 15 suspend payments and impose interest charges, to terminate provider agreements 16 and deny provider status, to impose civil monetary penalties and to exclude 17 certain individuals and entities. 18 SECTION 2. That Chapter 2, Title 56, Idaho Code, be, and the same is 19 hereby amended by the addition thereto of a NEW SECTION , to be 20 known and designated as Section 56-209h, Idaho Code, and to read as follows: 21 56-209h. ADMINISTRATIVE REMEDIES. (1) Definitions. For purposes of this 22 section: 23 (a) "Abuse" or "abusive" means provider practices that are inconsistent 24 with sound fiscal, business, or medical practices, and result in an unnec- 25 essary cost to the medical assistance program, in reimbursement for ser- 26 vices that are not medically necessary or that fail to meet professionally 27 recognized standards for health care, or in physical harm, pain or mental 28 anguish to a medical assistance recipient. 29 (b) "Claim" means any request or demand for payment of items or services 30 under the state's medical assistance program, whether under a contract or 31 otherwise. 32 (c) "Fraud" or "Fraudulent" means an intentional deception or misrepre- 33 sentation made by a person with the knowledge that the deception could 34 result in some unauthorized benefit to himself or some other person. 35 (d) "Knowingly," "known" or "with knowledge" means that a person, with 36 respect to information or an action: 37 (i) Has actual knowledge of the information or action; or 38 (ii) Acts in deliberate ignorance of the truth or falsity of the 39 information or the correctness or incorrectness of the action; or 40 (iii) Acts in reckless disregard of the truth or falsity of the 41 information or the correctness or incorrectness of the action. 42 (e) "Managing employee" means a general manager, business manager, admin- 2 1 istrator, director or other individual who exercises operational or mana- 2 gerial control over, or who directly or indirectly conducts the day-to-day 3 operation of, an institution, organization or agency. 4 (f) "Ownership or control interest" means a person or entity that: 5 (i) Has an ownership interest totaling twenty-five percent (25%) or 6 more in an entity; or 7 (ii) Is an officer or director of an entity that is organized as a 8 corporation; or 9 (iii) Is a partner in an entity that is organized as a partnership; 10 or 11 (iv) Is a managing member in an entity that is organized as a lim- 12 ited liability company. 13 (2) Documentation of services. All claims submitted by providers for pay- 14 ment are subject to prepayment and postpayment review as designated by rule. 15 Except as otherwise provided by rule, providers shall generate documentation 16 at the time of service sufficient to support each claim and shall retain the 17 documentation for a minimum of five (5) years from the date the item or ser- 18 vice was provided. The department or authorized agent shall be given immediate 19 access to such documentation upon written request. 20 (3) Immediate action. In the event that the department identifies a sus- 21 pected case of fraud or abuse and the department has reason to believe that 22 payments made during the investigation may be difficult or impractical to 23 recover, the department may suspend or withhold payments to the provider pend- 24 ing investigation. In the event that the department identifies a suspected 25 case of fraud or abuse and it determines that it is necessary to prevent or 26 avoid immediate danger to the public health or safety, the department may sum- 27 marily suspend a provider agreement pending investigation. When payments have 28 been suspended or withheld or a provider agreement suspended pending investi- 29 gation, the department shall provide for a hearing within thirty (30) days of 30 receipt of any duly filed notice of appeal. 31 (4) Recovery of payments. If it is determined that any condition of pay- 32 ment contained in rule, regulation, statute, or provider agreement was not 33 met, the department may recover any payments made for items or services. 34 Interest shall accrue on overpayments at the statutory rate set forth in sec- 35 tion 28-22-104, Idaho Code, from the date of final determination of the amount 36 owed for items or services until the date of recovery. 37 (5) Provider status. The department may terminate the provider agreement 38 or otherwise deny provider status to any individual or entity who: 39 (a) Submits a claim with knowledge that the claim is incorrect, including 40 reporting costs as allowable which were known to be disallowed in a previ- 41 ous audit, unless the provider clearly indicates that the item is being 42 claimed to establish the basis for an appeal and each disputed item and 43 amount is specifically identified; or 44 (b) Submits a fraudulent claim; or 45 (c) Knowingly makes a false statement or representation of material fact 46 in any document required to be maintained or submitted to the department; 47 or 48 (d) Submits a claim for an item or service known to be medically unneces- 49 sary; or 50 (e) Fails to provide, upon written request by the department, immediate 51 access to documentation required to be maintained; or 52 (f) Fails repeatedly or substantially to comply with the rules and regu- 53 lations governing medical assistance payments; or 54 (g) Knowingly violates any material term or condition of its provider 55 agreement; or 3 1 (h) Has failed to repay, or was a "managing employee" or had an 2 "ownership or control interest" in any entity that has failed to repay, 3 any overpayments or claims previously found to have been obtained contrary 4 to statute, rule, regulation or provider agreement; or 5 (i) Has been found, or was a "managing employee" in any entity which has 6 been found, to have engaged in fraudulent conduct or abusive conduct in 7 connection with the delivery of health care items or services; or 8 (j) Fails to meet the qualifications specifically required by rule or by 9 any applicable licensing board. 10 Any individual or entity denied provider status under this section may be pre- 11 cluded from participating as a provider in the medical assistance program for 12 up to five (5) years from the date the department's action becomes final. 13 (6) Civil monetary penalties. The department may also assess civil mone- 14 tary penalties against a provider and any officer, director, owner, and/or 15 managing employee of a provider for conduct identified in subsections (5)(a) 16 through (5)(i) of this section. The amount of the penalties shall be up to one 17 thousand dollars ($1,000) for each item or service improperly claimed, except 18 that in the case of multiple penalties the department may reduce the penalties 19 to not less than twenty-five percent (25%) of the amount of each item or ser- 20 vice improperly claimed if an amount can be readily determined. Each line item 21 of a claim, or cost on a cost report is considered a separate claim. These 22 penalties are intended to be remedial, recovering costs of investigation and 23 administrative review, and placing the costs associated with noncompliance on 24 the offending provider. 25 (7) Exclusion. Any individual or entity convicted of a criminal offense 26 related to the delivery of an item or service under any state or federal pro- 27 gram shall be excluded from program participation for a period of not less 28 than ten (10) years. Unless otherwise provided in this section or required by 29 federal law, the department may exclude any individual or entity for a period 30 of not less than one (1) year for any conduct for which the secretary of the 31 department of health and human services or designee could exclude an individ- 32 ual or entity. 33 (8) Adoption of rules. The department shall promulgate such rules as are 34 necessary to carry out the policies and purposes of this section.
STATEMENT OF PURPOSE
RS 0 8 0 4 6C 2
The purpose of this legislation is to provide explicit authority
and direction regarding the safeguarding of funds used in the
state's medical assistance program. It is the intent of the
Legislature to provide adequate remedies to recover payments that
are improperly claimed or paid. It is also the intent of the
Legislature to protect both state resources and individuals
receiving medical assistance from unprofessional, dishonest or
abusive providers by providing explicit authority to terminate
provider agreements, impose penalties, and exclude certain
providers and individuals.
FISCAL NOTE
The legislation is expected to result in no additional cost to
the state.
CONTACT:
Name: Kathleen Allyn
Agency: Department of Health and
Welfare
Phone: 334-5747
STATEMENT OF PURPOSE/FISCAL NOTE
H 742