MANAGED CARE TARGETED FOR RESTRICTIONS, MANDATES REFORMS OF MASTECTOMY COVERAGE, EMERGENCY CARE (PART THREE OF FIVE)

In Illinois, Gov. Jim Edgar signed a measure passed by the Legislature that bans health insurers from using genetic testing in coverage decisions.

The governor earlier this month also signed legislation requiring insured health plans to provide coverage of Pap smears, prostate exams and naprapathic services, or therapy that uses manipulation of the body without drugs.

Indiana enacted legislation that requires insured health plans to pay for diabetes care, services, equipment, appliances and education. The law bars annual deductibles or copayments that exceed those for similar benefits covered by the insurance plan.

Gov. Frank O'Bannon also signed a bill establishing parity for mental health coverage that closely mirrors federal legislation. The Indiana law, though, only applies to employees covered under the state's health insurance plan.

Other reforms the governor signed require insured plans to pay for reconstructive breast surgery after mastectomies and require managed care plans to maintain written grievance procedures and appeals policies.

Michigan legislators have introduced many bills relating to managed care that are pending in committee. Among them are measures that would: allow obstetrician/gynecologists to become primary care physicians at the request of women in managed care plans; prohibit "gag rules"; ban genetic discrimination by insurers; require HMOs to allow 48 hours of care after mastectomies; and mandate that HMOs cover emergency services, in and out of their networks.

Other pending bills include one that would expand HMO member access to boards of HMOs through creation of a health care consumer advocacy department within the state Health Department.

In Minnesota, a reform bill signed earlier this month expands eligibility for a program that provides coverage for low-income residents. The measure also eliminates a 1% premium tax on Blue Cross & Blue Shield plans and HMOs and cuts provider taxes for physicians who serve low-income populations. Another approved measure requires managed care plans to pay for self-education and training for patients with diabetes, while yet another reform requires managed care plans to provide direct access to obstetrician/gynecologists.

Ohio became the first state to give its Insurance Department regulatory authority over all health plans engaged in insurance, even if physicians own or operate them.

The Managed Care Uniform Licensure Act went into effect June 4 after Gov. George Voinovich signed it.

Under the law, managed care entities will be known as "health insurance corporations," or HICs, which pay for, provide or otherwise make available health care services through a panel of physicians.

The new law also places HMOs, health care corporations, dental care corporations and prepaid dental plans under the same regulatory umbrella with all other managed care entities. Previously, preferred provider organizations and physician hospital organizations were unregulated.

Solvency standards for the health insurance corporations are based on the types of services provided. Minimum net worth requirements for HICs vary from $1.2 million to $1.7 million.

Wisconsin legislators are considering a measure that would allow private employers to seek lower health insurance costs by joining with their public sector counterparts in the managed care programs run by Wisconsin's Group Insurance Board. The measure is pending in the Senate Health Committee.

PLAINS STATES: A new Iowa law effective July 1 mandates that employers with more than 50 employees and managed care plans provide a point-of-service option. The law also will require managed care plans to make available a POS plan option to employers with two to 50 employees.

The Kansas Legislature passed and Gov. Bill Graves signed several health care-related reforms this year, including the Patient Protection Act, which contains provisions effective July 1 that:

Bring the state into compliance with the federal Health Insurance Portability and Accountability Act of 1996. Group health insurance provisions included adopting the federal definition of "pre-existing conditions." The legislation also extended, to 63 days from 32 days, the gap permitted between prior health coverage and a new group plan to get credit against the pre-existing condition limits. Small-business policies also must be guaranteed available and guaranteed renewable, and the definition of a "small employer" was revised to cover businesses from two to 50 employees.

Establish a "prudent person" standard for payment of emergency room services.

Prohibit gag clauses in provider contracts and "negative incentives" that reward providers for not utilizing certain services or specialty care.

Bar the use of genetic screening or testing in underwriting health insurance.

Require parity between medical and mental health benefits in all group policies except those for small groups.

Other reforms also effective July 1 will repeal a requirement that HMOs buy medical malpractice insurance and will require, among other things, that employers provide coverage from the date an adopted child is placed in a home.

Missouri Gov. Mel Carnahan last week signed a comprehensive bill that would require organizations that deliver or pay for health care services to maintain an "adequate" provider network, disclose all plan benefits and limitations on care, prohibit "gag clauses," keep mental health records confidential and standardize grievance procedures.

In addition, the bill would:

Require coverage of off-label uses of federal Food and Drug Administration prescriptions and emergency services based on the opinion of a "prudent lay person."

Permit medical malpractice suits against managed care organizations and appeals of health care coverage denials.

Require the Insurance Department to establish and disclose provider credentialing standards and impose fines for violations.

Nebraska Gov. E. Benjamin Nelson recently signed The Managed Care Patient Protection Act, which prevents health plans from imposing "gag clauses" on physicians or offering "unreasonable" incentives to physicians or other health care providers, though that term is not defined. The act also prevents a health plan from imposing unreasonable limits on emergency room care that a "prudent" lay person may seek.

North Dakota enacted numerous health-care related laws that will become effective Aug. 1. Provisions of the legislation will:

Bar insurers from interfering with communication between health care providers and patients or from retaliating against providers.

Prohibit third-party administrators from requiring health care providers to indemnify the TPA for any negligence or to waive the right to bring actions against the TPA.

Extend group coverage for mental health disorders to include residential treatment.

Establish a minimum post-delivery coverage requirement of 48 hours for mothers and newborns after normal vaginal deliveries and 96 hours for normal Caesarean deliveries.

South Dakota Gov. William J. Janklow signed into law a measure that prohibits health plans from denying benefits to participants who are injured while operating a motor vehicle under the influence of alcohol or drugs. The law becomes effective July 1.

Also effective July 1 is a law that requires health care plans to cover a worker's injury if the worker's employer determines the injury is not work-related. If the health care plan denies coverage without a full explanation, the state's insurance director may determine that the coverage denial is an unfair trade practice. If the injury later is determined to be work-related, the employer must reimburse the health plan and the worker with interest.

Gov. Janklow signed another bill that generally prohibits all insurers from refusing to issue or renew policies based solely on the age, race, color, creed, national origin, ancestry, occupation, marital status or residence of applicants. However, life, health and annuity insurers may deny coverage because of an applicant's age. And, life and disability insurers may use an applicant's occupation to deny coverage. (continued in part 4).