DEPARTMENT OF HEALTH AND SOCIAL SERVICES
Office of Health Facilities Licensing and Certification
Statutory Authority: 16 Delaware Code,Section 9110 (16 Del.C. 9110)
IN THE MATTER OF: |
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REVISION OF STATE OF DELAWARE |
RULES AND REGULATIONS GOVERNING |
THE APPLICATION AND OPERATION OF |
MANAGED CARE ORGANIZATIONS |
NATURE OF THE PROCEEDINGS:
Delaware Health and Social Services (“DHSS”) initiated proceedings to amend existing Rules and Regulations Governing The Application And Operation of Health Maintenance Organizations and renamed the Rules and Regulations Governing The Application and Operation of Managed Care Organizations. The DHSS’s proceedings to amend its regulations were initiated pursuant to 29 Delaware Code Section 10114 and its authority as prescribed by 16 Delaware Code Chapter 91.
On July 1, 1998, the DHSS published in the Delaware Register of Regulations Volume 2 Issue 1 (page 42) its notice of proposed regulation changes, pursuant to 29 Delaware Code Section 10115. It requested that written materials and suggestions from the public concerning the proposed regulations be delivered to DHSS by August 3, 1998, or be presented at public hearings on July 28 or July 30, 1998, at which time the Department would review information, factual evidence and public comment to the said proposed changes to the regulations.
Oral and written comments were received and evaluated. The results of that evaluation are summarized in the accompanying “Summary of Evidence.”
FINDINGS OF FACT:
The Department finds that the proposed changes as set forth in the attached copy should be made in the best interest of the general public of the State of Delaware.
THEREFORE, IT IS ORDERED, that the proposed Rules And Regulations Governing The Application and Operation of Managed Care Organizations are adopted and shall become effective February 1, 1999, after publication of the final regulation in the Delaware Register.
November 16, 1998
Gregg C. Sylvester, MD
Secretary
SUMMARY OF EVIDENCE
STATE OF DELAWARE RULES AND REGULATIONS GOVERNING THE APPLICATION AND OPERATION OF MANAGED CARE ORGANIZATIONS
Public hearings were held on July 28, 1998 at the Jesse Cooper Building, Dover, Delaware and on July 30, 1998 at the Department of Health and Social Services (DHSS) Herman Halloway Campus, New Castle, Delaware before Cheryl Moore, Hearing Officer, to discuss the proposed DHSS Rules and Regulations Governing the Application and Operation of Managed Care Organizations. The announcements regarding the hearings were advertised in the Delaware State News, The News Journal and the Delaware Registry of Regulations in accordance with Delaware law. Ellen T. Reap made the agency’s presentation. Attendees were allowed and encouraged to discuss and ask questions regarding all sections of the proposed regulations. Comments were provided by MCO attorneys representing the MCOs, Department of Insurance, physicians, health care associations and private citizens. A thorough review of all comments was conducted by Health Facilities Licensing and Certification staff, DPH leadership, the Deputy Attorney General and DHSS administration. In general, comments fell into four areas of concern. Those concerns and the DHSS (Agency) response are as follows:
• Disagreement regarding the requirement that the MCO Medical Director be a licensed Delaware physician;
Agency Response: DHSS recommends maintaining this requirement. It was the recommendation of the HR#94 Committee on Public Oversight of Managed Care Costs, Quality and Care to require the MCO Medical Directors be a licensed Delaware physician. In addition, this recommendation is unanimously supported by the Delaware Board of Medical Practitioners who state, “...Medicare Directors of MCOs operating in Delaware and making decisions about Delaware patients must hold a registration to practice medicine in Delaware.” DHSS supports their position that if the MCO is using the clinical judgment of a physician (as Medical Director) to limit payment for health services, that physician should be a Delaware licensed physician.
• Concern over dual regulation of the MCO industry by both DHSS and the Department of Insurance;
Agency Response: The Agency recommends maintaining these regulations as submitted. The HR#94 Committee supported the regulations as written. While some duplication of reporting may exist between DHSS and the Department of Insurance, these reports are either required by Delaware Code or are already required by the current Health Maintenance Organization regulations. However, DHSS recognizes industry concern over the cost of duplicative and excess paperwork to the industry and ultimately the consumer. In response to these concerns, DHSS will explore the development of a joint Delaware Health and Social Services/Department of Insurance application and annual reporting process.
• Requests to eliminate the Stage 3 grievance appeal process or replace it with an alternative procedure;
Agency Response: DHSS recommends maintaining the Stage 3 grievance appeal process as written. The Stage 3 appeal process provides enrollees with an unbiased review of their appeal and avoids costly litigation. It is the Agency’s position that enrollees have the right to an unbiased review of their appeal. The HR#94 Committee supported this need as well. The alternative procedure recommended by one of the commentees was not presented in sufficient detail so as to be usable. Regardless, in the Agency’s opinion, it presented two major obstacles to a fair grievance process by mandating the incurred cost of the denied service eligible for a State 3 appeal be $1,000 or more and requiring the enrollee to pay $100 upon filing the appeal.
• Comments that similar contract provisions exist in both the DHSS proposed regulations and the Department of Insurance Regulations.
Agency Response: The Agency recommends maintaining these regulations as written. DHSS acknowledges that similar “contract provision” language exists in both these and Department of Insurance regulations. DHSS added this language at the request of the Department of Insurance because the Delaware Code does not provide the Department of Insurance with sufficient statutory authority to regulate contracts.
There were two minor changes made to the draft regulations presented at the July public hearings. The changes were reviewed and approved by both the Deputy Attorney General and the Cabinet Secretary of DHSS. Neither considered the changes to be substantive in nature.
The changes are:
1. Section 69.401.D.1. – Changes were made in the 5th and 6th lines of the paragraph. The words “...pediatrics, obstetrics, and gynecology...” were changed to read “...pediatrics, obstetrics—gynecology...”.
2. Section 69.604.E. – A period was inserted in the third line after the word “enrollees” and the remainder of the sentence deleted.
The public comment period was open from July 1, 1998 to August 3, 1998.
Verifying documents are attached to the Hearing Officer’s record. The regulations have been approved by the Delaware Attorney General’s office and the Cabinet Secretary of DHSS.
RULES AND REGULATIONS GOVERNING THE APPLICATION AND OPERATION OF MANAGED CARE ORGANIZATIONS
Adopted by the Department of Health and Social Services on November 16, 1998, effective February 1, 1999.
TABLE OF CONTENTS PAGE
PART ONE 4
69.0 Legal Authority and Definitions 4
69.1 Definitions 4
PART TWO 9
69.2 Application and Certificate of Authority 9
PART THREE 14
69.3 General Requirements 14
PART FOUR 21
69.4 Quality Assurance and Operations 21
Health Care Professional Credentialing 21
Provider Network Adequacy 24
Utilization Management 27
Grievance/Appeal Procedure 29
Quality Assessment and Improvement 34
PART FIVE 38
69.5 Enrollee Rights and Responsibility 38
PART SIX 41
69.6 Staff Model MCO Requirements 41
Environmental Health and Safety 41
Emergency Utilities or Facilities 42
Construction 42
Personnel 43
Equipment 43
Specialized Services 43
Central Sterilizing and Supply 44
PART SEVEN 45
69.6 Administrative Requirements 45
Administration 45
Qualifications 45
Medical Privileges 45
Medical Records 45
Reporting Requirements and Statistics 46
Appendix Certification Application
* Please note the above page numbers refer to the original document and not to page numbers in the Register.
PART ONE
LEGAL AUTHORITY AND DEFINITIONS
SECTION 69.0 LEGAL AUTHORITY
These regulations are adopted under Part VIII, Title 16, Delaware Code, Chapter 91, pursuant to delegation of authority from the Secretary of the Department of Health and Social Services to the Director of the Division of Public Health effective March 15, 1983 and revised July 1,1989.
SECTION 69.1 DEFINITIONS
69.101 “Administrator/Chief Executive Officer” means the individual employed to manage and direct the activities of the MCO.
69.102 “Basic health services” means a range of services, including at least the following:
A. Physician services including consultant and referral services by a physician licensed by the State of Delaware.
B. At least three hundred sixty-five (365) days of inpatient hospital services.
C. Medically necessary emergency health services.
D. Initial diagnosis and acute medical treatment (at least one (1) time) and responsibility for making initial behavioral health referrals.
E. Diagnostic laboratory services.
F. Diagnostic and therapeutic radiological services.
G. Preventive health services including at least the provision of physical examinations, papanicolaou smears, immunizations, mammograms and childrens’ eye examinations (through age 17), conducted to determine the need for vision correction performed at a frequency determined to be appropriate medical practice. Other preventive services may be provided by the MCO as contained in the Health Care Contract.
H. Health education services including education in the appropriate use of health services and education in the contribution each enrollee can make to the maintenance of the enrollee’s own health. This information shall be understandable and not misleading.
I. Emergency out-of-area coverage.
69.103 “Certificate of Authority” means the authorization by the Department of Health and Social Services to operate the MCO and this certificate shall be deemed to be a license to operate such an Organization.
69.104 “Certified Managed Care Organization” (MCO) means a managed care organization which has been issued a Certificate of Authority under 16 Del. C. and either a Certificate of Authority from the Insurance Department under the relevant provisions of Title 18 or a statement from the Insurance Department that the Insurance Department Certificate of Authority is not required.
69.105 “Commissioner” means the Insurance Commissioner of Delaware.
69.106 “Department” means the Delaware Department of Health and Social Services.
69.107 “Emergency Care” means health care items or services furnished or required to evaluate or treat an emergency medical condition.
69.108 “Emergency Medical Condition” means a medical condition manifesting itself by acute symptoms of sufficient severity (including severe pain) such that a prudent layperson, who possesses an average knowledge of health and medicine, could reasonably expect the absence of immediate medical attention to result in:
(i) placing the health of the individual (or, with respect to a pregnant woman, the health of the woman or her unborn child) in serious jeopardy;
(ii) serious impairment to bodily functions; or
(iii) serious dysfunction of any bodily organ or part.
69.109 “Enrollee” means an individual and/or family who has entered into a contractual arrangement, or on whose behalf a contractual arrangement has been entered into with the MCO, under which the MCO assumes the responsibility to provide to such person(s) basic health services and such supplemental health services as are enumerated in the Health Care Contract.
69.110 “Geographical area” refers to the stated primary geographical area served by a MCO. The primary area served shall be a radius of not more than twenty (20) miles nor more than thirty (30) minutes driving time from a primary care office operated or contracted by the MCO.
69.111 “Health care contract” refers to any agreement between a MCO and an enrollee or group plan which sets forth the services to be supplied to the enrollee in exchange for payments made by the enrollee or group plan.
69.112 “Health care professional” means individuals engaged in the delivery of health services as licensed or certified by the State of Delaware.
69.113 “Health care services” means any services included in the furnishing to any individual of medical or dental care, or hospitalization or incidental to the furnishing of such care or hospitalization, as well as the furnishing to any person of any and all other services for the purpose of preventing, alleviating, curing or healing human illness, injury or physical disability.
69.114 “Independent Practice Association” (IPA) means an arrangement in which health care professionals provide their services through the association in accordance with a mutually accepted compensation arrangement while retaining their private practices.
69.115 “Insurance Department” means the Delaware Insurance Department.
69.116 “Insurance Department Certificate of Authority” means the authorization by the Insurance Commissioner that the MCO has met the relevant provisions of Title 18 of the Delaware Code.
69.117 “Intermediary” means a person authorized to negotiate and execute provider contracts with MCOs on behalf of health care providers or on behalf of a network.
69.118 “Level 1 Trauma Center” means a regional resource trauma center that has the capability of providing leadership and comprehensive, definitive care for every aspect of injury from prevention through rehabilitation.
69.119 “Level 2 Trauma Center” means a regional trauma center with the capability to provide initial care for all trauma patients. Most patients would continue to be cared for in this center; there may be some complex cases which would require transfer for the depth of services of a regional Level 1 or specialty center.
69.120 “Managed Care Organization” (MCO) means a public or private organization organized under the laws of any state, which:
A. provides or otherwise makes available to enrolled participants health care services, including at least the basic health services defined in 69.102;
B. is primarily compensated (except for co-payment) for the provision of basic health care services to the enrolled participants on a predetermined periodic rate basis; and
C. provides physician services directly through physicians who are either employees or partners of such organization, or through arrangements with individual physicians or one or more groups of physicians (organized on a group practice or individual practice basis).
9.121 “Network” means the participating providers delivering services to enrollees in a managed care plan.
69.122 “Office” means any facility where enrollees receive primary care or other health services.
69.123 “Out of area coverage” refers to health care services provided outside the organization’s geographic service areas with appropriate limitations and guidelines acceptable to the Department and the Commissioner. At a minimum, such coverage must include emergency care.
69.124 “Participating provider” means a provider who, under a contract with the Organization or with its contractor or subcontractor, has agreed to provide health care services to enrollees with an expectation of receiving payment, other than coinsurance, co-payments or deductibles, directly or indirectly from the Organization.
69.125 “Premium” refers to payment(s) called for in the Health Care Contract which must be:
A. paid or arranged for by, or on behalf of, the enrollee before health care services are rendered by the Organization;
B. paid on a periodic basis without regard to the date on which health services are rendered; and
C. with respect to an individual enrollee are fixed without regard to frequency, extent or cost of health services actually furnished.
69.126 “Primary Care Physician” (PCP) means a participating health care physician chosen by the enrollee and designated by the Organization to supervise, coordinate, or provide initial care or continuing care to an enrollee, and who may be required by the Organization to initiate a referral for specialty care and maintain supervision of health care services rendered to the enrollee.
69.127 “Provider” means a health care professional or facility.
69.128 “Staff model MCO” means a MCO in which physicians are employed directly by the MCO or in which the MCO directly operates facilities which provide health care services to enrollees.
69.129 “Supplemental payment” refers to any payment not incorporated in premium which is required to be paid to the MCO or providers under contract to the MCO by the enrollee.
69.130 “Supplementary health services” means any health services other than basic health services which may be provided by a MCO to its enrollees and/or for which the enrollee may contract such as:
A. Long term care;
B. Vision care not included in basic health services;
C. Dental services;
D. Behavioral health services;
E. Long term physical medicine or rehabilitative services;
F. Pharmacy services;
G. Infertility services; and
H. Other services, such as occupational therapy, nutritional, home health, homemaker, hospice and family planning services.
69.131 “Tertiary services” means health care services provided for the intensive treatment of critically ill patients who require extraordinary care on a concentrated basis in special diagnostic categories (e.g. burns, cardiovascular, neonatal, pediatric, oncology, transplants, etc.).
PART TWO
SECTION 69.2 APPLICATION AND CERTIFICATE OF AUTHORITY
69.201 No person shall establish or operate a MCO in the State of Delaware or enter this State for purposes of enrolling persons in a MCO without obtaining a “Certificate of Authority” under Chapter 91 of Title 16 of the Delaware Code. A foreign corporation shall not be eligible to apply for such certificate unless it has first qualified to do business in the State of Delaware as a foreign corporation pursuant to 8 Del. C., §371.
69.202 Each application for a Certificate of Authority shall be made in writing to the Department of Health and Social Services, shall be certified by an officer or authorized representative of the applicant, shall be in a form prescribed by the Department (Appendix A) and shall set forth or be accompanied by the following:
A. Organizational Information
1. Brief history and description of current status of applicant, including an organization chart;
2. A copy of the basic organizational documents such as the certificate of incorporation, articles of association, partnership agreement, trust agreement or other appropriate documents and amendments thereto;
3. A list of the names, addresses and official positions of the persons who are to be responsible for the conduct of the affairs of the applicant. Include all enrollees of the Board of Directors or other governing board, the principal officers in the case of a corporation, and the partners or enrollees in the case of a partnership or association; and
4. A list of positions, names and resumes for all management personnel.
B. Health Services Delivery
1. A description of the plan of operation of the MCO. Include the following items:
a) a listing of basic health services and supplemental health services (as defined at 69.102 and 69.130 respectively) with utilization projections; and
b) the arrangements for delivery of all covered health services (including details as to whether outpatient services are provided directly or through referrals/purchase agreements with outside fee-for-service providers); a description of service sites or facilities (specifying days and hours of operation in the case of outpatient facilities); and all special policies or provisions designed to improve accessibility of services.
2. Copies of all executed contracts, agreements or arrangements between the MCO and providers, including individual physicians, IPAs, group practices, hospitals, laboratory services, nursing homes, home health agencies, and other providers. In addition, copies of executed contracts or letters of agreement between an IPA or medical group and its member or non-member physicians and other health professionals;
3. A list of participating physicians by specialty and by geographic area as well as a list of other health care personnel providing services. Each physician included on the list must be identified as accepting or not accepting new patients and if there are any limitations on that physician’s accepting any enrollees as patients. Staffing ratios shall be prepared for each geographic area in which the MCO proposes to operate. Staffing ratios are the number of physicians or providers by specialty per enrollee;
4. For staff model MCOs, a list of facilities that show the capacity, square footage, and the legal arrangements for use of the facility (leases, subleases, contract of sale, etc.). Provide copies of leases, contracts of sale, or other legal agreements relating to the facilities to be operated by the MCO;
5. All of the applicant’s utilization review and utilization management, utilization control, quality assurance mechanisms, policies, manuals, guidelines, and materials including information on committee structures and criteria;
6. The arrangements for assuring continuity of care for all services provided to enrollees. Include comments on policies related to the primary care physician’s responsibilities for coordination and oversight of the enrollee’s overall health care and the impact of the medical record keeping system on continuity of care;
7. Procedures utilized by the applicant for determining and ensuring network adequacy;
8. Procedures utilized by the applicant for the credentialing of providers;
9. Procedures for addressing enrollee grievances;
10. Any materials or procedures utilized by the applicant for measuring or assessing the satisfaction of enrollees; and
11. Procedures for monitoring enrollee access to participating providers including but not limited to:
a) appointment scheduling guidelines;
b) standards for office wait times; and
c) standards for provider response to urgent and emergent issues during and after business hours.
C. Enrollment and Marketing
1. A description of the target population, including projections of enrollment levels on a quarterly basis for at least the first three (3) years of operation and the key assumptions underlying these projections;
2. A description of the geographic area to be served, with a map showing service area boundaries, locations of the MCO’s participating providers, PCPs, institutional and ambulatory care facilities, and travel times from various points in the service area to the nearest ambulatory and institutional services;
3. Identification of all information to be released to enrollees or prospective enrollees;
4. A description of the proposed marketing techniques and sample copies of any advertising or promotional materials to be used within Delaware or to which Delaware citizens would be exposed;
5. Enrollee handbooks proposed for use. A finalized enrollee handbook shall also be submitted upon completion; and
6. Procedures for notifying enrollees of plan changes.
D. Financial
1. A financial statement for the most recent fiscal year certified by a Certified Public Accountant (CPA);
2. Financial projections for a minimum of three (3) years. If deficits are anticipated, the projections should cover the period up to and including the year in which break-even is expected. Include projections of revenue and expenses; a projected balance sheet; a pro forma cash flow statement; and a pro forma statement of changes in financial position. Indicate the assumptions on which statements are based, including inflation and utilization assumptions;
3. Sources of financing (private and governmental) and, where appropriate, written assurances of the availability of financing;
4. A description of all reinsurance arrangements or risk sharing arrangements with providers; and
5. The proposed premiums for all classes of enrollee, co-payments, and the rating plan or rating rules used by the applicant.
69.203 Within sixty (60) days after receipt of a complete application for issuance of Certificate of Authority the Department shall determine whether the applicant, with respect to health care services to be furnished, has:
A. demonstrated the ability to provide such health services in a manner assuring availability, accessibility and continuity of services;
B. arrangements for an ongoing health care quality assurance program;
C. the capability to comply with all applicable rules and regulations promulgated by the Department;
D. the capability to provide or arrange for the provision to its enrollees of basic health care services on a prepaid basis through insurance or otherwise, except to the extent of reasonable requirements of co-payments; and
E. for staff model MCOs, the staff and facilities to directly provide at least half of the outpatient medical care costs of its anticipated enrollees on a prepaid basis.
69.204 The Department shall issue a Certificate of Authority to any person filing an application under this section upon demonstration of compliance with these rules and regulations if:
A. The application contains all the information required under 69.202 of this Part;
B. The Department has not made a negative determination pursuant to 69.203 of this Part; and
C. Payment of the application fees prescribed in 16 Del. C. Chapter 91, has been made.
69.205 If within 60 days after a complete application for a Certificate of Authority has been filed, the Department has not issued such certificate, the Department shall immediately notify the applicant, in writing, of the reasons why such certificate has not been issued and the applicant shall be entitled to request a hearing on the application. The hearing shall be held within 60 days of receipt of written request therefor. Proceedings in regard to such hearing shall be conducted in accordance with provisions for case decisions as set forth in the Administrative Procedures Act, Chapter 101 of Title 29, and in accordance with applicable rules and regulations of the Department (63 Del. Laws, c.382, §1;66 Del. Laws, c. 124, §7.).
69.206 No Certificate of Authority shall be issued without a Certificate of Authority from the Insurance Department under the relevant provisions of Title 18 or a statement from the Insurance Department that the Insurance Department Certificate of Authority is not required.
If a deposit is required, it shall be continuously maintained in trust. In case of a deficiency of deposit, the Insurance Commissioner shall transmit notice thereof to both the MCO and the Department. In case the deficiency is not cured within the allowed time, the Commissioner shall give notice thereof to the Department and the Department shall revoke its Certificate of Authority to the MCO.
PART THREE
SECTION 69.3 GENERAL REQUIREMENTS
69.301 Every MCO operating in this State shall file with the Department every manual which it proposes to use. Every filing shall indicate the effective date thereof.
69.302 Annual reports shall be filed with the Department by any MCO on or before June 1 covering the preceding fiscal year. Such reports shall include a financial statement of the MCO, its balance sheet and receipts and disbursements for the preceding fiscal year, and any changes in the information originally submitted or required under 69.2, 69.404 E., 69.405 B. and 69.705.
69.303 Contract Provisions
A. Every contract between a MCO and a participating provider shall contain the following language:
1. “Provider agrees that in no event, including but not limited to nonpayment by the MCO or intermediary, insolvency of the MCO or intermediary, or breach of this agreement, shall the provider bill, charge, collect a deposit from, seek compensation, remuneration or reimbursement from, or have any recourse against an enrollee or a person (other than the MCO or intermediary) acting on behalf of the enrollee for services provided pursuant to this agreement. This agreement does not prohibit the provider from collecting coinsurance, deductibles or co-payments, as specifically provided in the evidence of coverage, or fees for uncovered services delivered on a fee-for-service basis to enrollees.”
2. “In the event of a MCO or intermediary insolvency or other cessation of operations, covered services to enrollees will continue through the period for which a premium has been paid to the MCO on behalf of the enrollee or until the enrollee’s discharge from an inpatient facility, whichever time is greater. Covered benefits to enrollees confined in an inpatient facility on the date of insolvency or other cessation of operations will continue until their continued confinement in an inpatient facility is no longer medically necessary.”
3. The contract provisions that satisfy the requirements of Subsections 1. and 2. above shall be construed in favor of the enrollee, shall survive the termination of the contract regardless of the reason for termination, including the insolvency of the MCO, and shall supersede any oral or written contrary agreement between a provider and an enrollee or the representative of an enrollee if the contrary agreement is inconsistent with the hold harmless and continuation of covered services provisions required by Subsections 1. and 2. above.
4. Every contract between a MCO and a participating provider shall state that in no event shall a participating provider collect or attempt to collect from an enrollee any money owed to the provider by the MCO.
69.304 Amendments or Revisions of Contracts
Any significant amendment to or revision relating to the text or subtext of an approved provider contract shall be submitted to and approved by the Department prior to the execution of an amended or revised contract with the providers of a MCO.
69.305 The MCO shall establish a policy governing termination of providers. The policy shall include at least:
A. Written notification to each enrollee six (6) weeks prior to the termination or withdrawal from the MCO’s provider network of an enrollee’s primary care physician except in cases where termination was due to unsafe health care practice; and
B. Except in cases where termination was due to unsafe health care practices that compromise the health or safety of enrollees, assurance of continued coverage of services at the contract price by a terminated provider for up to 120 calendar days in cases where it is medically necessary for the enrollee to continue treatment with the terminated provider. In cases of the pregnancy of an enrollee, medical necessity shall be deemed to have been demonstrated and coverage shall continue to completion of postpartum care.
69.306 The Medical Director and physicians designated to act on his behalf shall be Delaware licensed physicians.
69.307 Prohibited Practices
A. No MCO or representative may cause or permit the use of advertising or solicitation which is untrue or misleading.
B. No MCO may cancel or refuse to renew the enrollment of an enrollee solely on the basis of his/her health. This does not prevent the MCO from canceling the enrollment of an enrollee if misstatements of his/her health were made at the time of enrollment, or prevent the MCO from canceling or refusing to renew enrollment for reasons other than an enrollee’s health including without limitation, nonpayment of premiums or fraud by the enrollee.
C. A MCO contract shall contain no provision or nondisclosure clause prohibiting physicians or other health care providers from giving patients information regarding diagnoses, prognoses and treatment options.
D. A MCO shall not deny, exclude or limit benefits for a covered individual for losses due to a preexisting condition where such were incurred more than twelve (12) months following the date of enrollment in such plan or, if earlier, the first day of the waiting period for such enrollment.
E. A MCO shall not impose any preexisting condition exclusion relating to pregnancy or in the case of a child who is adopted or placed for adoption before attaining eighteen (18) years of age and who, as of the last day of the 30-day period beginning on the date of the adoption or placement for adoption, is covered under creditable coverage. The previous sentence shall not apply to coverage before the date of such adoption or placement for adoption.
F. A MCO shall not offer incentives to a provider to provide less than medically necessary services to an enrollee.
G. A MCO shall not penalize a provider because the provider, in good faith, reports to state authorities any act or practice by the MCO that jeopardizes patient health or welfare.
H. A contract between a MCO and a provider shall not contain definitions or other provisions that conflict with the definitions or provisions contained in these regulations.
69.308 A MCO shall establish a mechanism by which the participating provider will be notified on an ongoing basis of the specific covered health services for which the provider will be responsible, including any limitations or conditions on services.
69.309 A MCO shall notify participating providers of the providers’ responsibilities with respect to the MCO’s applicable administrative policies and programs, including but not limited to payment terms, utilization review, quality assessment and improvement programs, credentialing, grievance procedures, data reporting requirements, confidentiality requirements and any applicable federal or state programs.
69.310 The rights and responsibilities under a contract between a MCO and a participating provider shall not be assigned or delegated by the provider without the prior written consent of the MCO.
69.311 A MCO is responsible for ensuring that a participating provider furnishes covered benefits to all enrollees without regard to the enrollee’s enrollment in the plan as a private purchaser of the plan or as a participant in publicly financed programs of health care services. This requirement does not apply to circumstances when the provider should not render services due to limitations arising from lack of training, experience, skill or licensing restrictions.
69.312 A MCO shall notify the participating providers of their obligations, if any, to collect applicable coinsurance, copayments or deductibles from enrollees pursuant to the evidence of coverage, or of the providers’ obligations, if any, to notify enrollees of their personal financial obligations for non-covered services.
69.313 A MCO shall establish procedures for resolution of administrative, payment or other disputes between providers and the MCO.
69.314 Notice of Changes in MCO Operations
The MCO shall notify the Department of Health and Social Services, in writing, on an ongoing basis, of any substantial changes in organization, bylaws, governing board, provider contracts or agreements, marketing materials, grievance procedures, enrollee handbooks, utilization management program, and any change of inpatient acute care hospitals. The Department shall be notified on at least a quarterly basis of changes in the provider network.
69.315 Changes in Ownership Interests
Certificates of Authority shall not be assignable or transferable in whole or in part. Accordingly, the holder of record of any Certificate of Authority to operate in Delaware, as a condition thereof, shall comply with all of the following requirements regarding changes in ownership interests. For the purposes of this section, changes in ownership interests shall refer to changes in the ownership of the holder of record of any Certificate of Authority and/or changes in ownership of any individual, corporation or other entity which, through the ownership of voting securities, by contract or by any other means, has the authority to or does in fact direct or cause the direction of the management and/or the policies of the MCO which is the subject of the Certificate of Authority at issue.
69.316 Examinations
A. The Department may make examinations concerning the quality of health care services of any MCO. The Department may make such examination as it deems necessary for the protection of the interests of the enrollees of the MCO, but not less frequently than every three (3) years;
B. Every MCO shall submit its books and records relating to health care services to such examinations. In the course of such examinations, the Department may administer oaths to and examine the officers and agents of the MCO and of any health care providers with which it has contracts, agreements or other arrangements. The MCO shall require a provider to make health records available to the Department employees involved in assessing the quality of care or investigating the grievances or complaints of enrollees, and to comply with the applicable laws related to the confidentiality of medical or health records; and
C. The reasonable expenses of examinations under this section shall be assessed against the MCO being examined and remitted to the Department.
69.317 Suspension or Revocation of Certificate of Authority.
A. The Department may revoke or suspend a Certificate of Authority issued to a MCO pursuant to 16 Del. C. Chapter 91, or may place the MCO on probation for such period as it determines, or may publicly censure a MCO if it determines, after a hearing, that:
1. The MCO is operating in a manner which deviates substantially, in a manner detrimental to its enrollees, from the plan of operation described by it in securing its Certificate of Authority;
2. The MCO does not have in effect arrangements to provide the quantity and quality of health care services required by its enrollees;
3. The MCO is no longer in compliance with the requirements of 16 Del. C. §9104(b); or
4. The continued operation of the MCO would be detrimental to the health or well-being of its enrollees needing services.
B. Proceedings in regard to any hearing held pursuant to this section shall be conducted in accordance with provisions for case decisions as set forth in the Administrative Procedures Act, 29 Del. C. §101, and any applicable rules and regulations of the Department. Any decision rendered following a hearing shall set forth the findings of fact and conclusions of the Department as to any violations of this Chapter, and shall also set forth the reasons for the Department’s choice of any sanction to be imposed. The Department’s choice of sanction shall not be disturbed upon appeal, except for abuse of discretion.
C. Suspension of a Certificate of Authority pursuant to this section shall not prevent the MCO from continuing to serve all its enrollees as of the date the Department issues a decision imposing suspension, nor shall it preclude thereafter adding as enrollees newborn children or other newly acquired dependents of existing enrollees. Unless otherwise determined by the Department and set forth in its decision, a suspension shall, during the period when it is in effect, preclude all other new enrollments and also all advertising or solicitation on behalf of the MCO other than communication, approved by the Department, which are intended to give information as to the effect of the suspension.
D. In the event that the Department decides to revoke the Certificate of Authority of a MCO the decision so providing shall specify the time and manner in which its business shall be concluded. If the Department determines it is appropriate, it may refer the matter of conservation or liquidation to the Insurance Commissioner, who shall then proceed in accordance with 18 Del. C., Chapter 59. In any case, after the Department has issued a decision revoking a Certificate of Authority, unless stayed in connection with an appeal, the MCO shall not conduct any further business except as expressly permitted in the Department’s decision and it shall engage only in such activities as are directed by the Department or are required to assist its enrollees in securing continued health care coverage.
E. The Department may require a corrective action plan from a MCO when the Department determines that the MCO is not in compliance with any of the regulations contained herein.
69.318 Fees
Every MCO shall pay the following fees:
A. For filing an application for a Certificate of Authority - three hundred and seventy-five dollars ($375.00).
B. For filing an annual report - two hundred and fifty dollars ($250.00).
69.319 Confidentiality of Health Information
Any data or information pertaining to the diagnosis, treatment or health of any enrollee or applicant obtained from such person or from any health care provider by any MCO shall be held in confidence and shall not be disclosed to any person except upon the express consent of the enrollee or applicant, or his physician, or pursuant to statute or court order for the production of evidence or the discovery thereof, or in the event of claim or litigation between such person and the MCO wherein such data or information is pertinent or as may be required by the Department in the course of their examinations in accordance with 69.316. The communication of such data or information from a health care provider to a MCO shall not prevent such data or information from being deemed confidential for purposes of the Delaware Uniform Rules of Evidence.
69.320 The MCO is responsible for meeting each requirement of these regulations. If the MCO chooses to utilize contract support or to contract functions under these regulations, the MCO retains responsibility for ensuring that the requirements of this regulation are met.
69.321 Specific standards may be waived by the Department provided that each of the following conditions are met:
A. Strict enforcement of the standard would result in unreasonable hardship on the MCO.
B. A waiver must not adversely affect the health, safety, welfare, or rights of any enrollee of the MCO.
C. The request for a waiver must be made to the Department, in writing, by the MCO with substantial detail justifying the request.
D. Prior to filing a request for a waiver, the MCO shall provide written notice of the request to each enrollee. Prior to filing a request for a waiver, the MCO shall also provide written notice of the request to the Department. The notice shall state that the enrollee has the right to object to the waiver request in writing to the Department.
Upon filing the request for a waiver, the MCO shall submit to the Department a copy of the notice and a sworn affidavit outlining the method by which the requirement was met. The MCO shall maintain proof of the method by which the requirement was met by the MCO for the duration of the waiver and make such proof available upon the request of the Department.
E. A waiver granted by the Department is not transferable to another MCO in the event of a change of ownership.
F. A waiver shall be granted for the term of the license.
PART FOUR
SECTION 69.4 QUALITY ASSURANCE AND OPERATIONS
69.401 Health Care Professional Credentialing
A. General Responsibilities, a MCO shall:
1. Establish written policies and procedures for credentialing verification of all health care professionals with whom the MCO contracts and apply these standards consistently;
2. Verify the credentials of a health care professional before entering into a contract with that health care professional. The medical director of the MCO or other designated health care professional shall have responsibility for, and shall participate in, health care professional credentialing verification;
3. Establish a credentialing verification committee consisting of licensed physicians and other health care professionals to review credentialing verification information and supporting documents and make decisions regarding credentialing verification;
4. Make available for review by the applying health care professional upon written request all application and credentialing verification policies and procedures;
5. Retain all records and documents relating to a health care professionals credentialing verification process for not less than four (4) years; and
6. Keep confidential all information obtained in the credentialing verification process, except as otherwise provided by law.
B. Nothing in these regulations shall be construed to require a MCO to select a provider as a participating provider solely because the provider meets the MCO’s credentialing verification standards, or to prevent the MCO from utilizing separate or additional criteria in selecting the health care professionals with whom it contracts.
C. Selection standards for participating providers shall be developed for primary care professionals and each health care professional discipline. The standards shall be used in determining the selection of health care professionals by the MCO, its intermediaries and any provider networks with which it contracts. The standards shall meet the requirements of 69.401 A. and 69.401 D. Selection criteria shall not be established in a manner:
1. That would allow a MCO to avoid high-risk populations by excluding providers because they are located in geographic areas that contain populations or providers presenting a risk of higher than average claims, losses or health services utilization; or
2. That would exclude providers because they treat or specialize in treating populations presenting a risk of higher than average claims, losses or health services utilization.
D. Qualifications of primary care providers
1. Physicians qualified to function as primary care providers include: licensed physicians who have successfully completed a residency program accredited by the Accreditation Council for Graduate Medical Education or approved by the American Osteopathic Association in family practice, internal medicine, general practice, pediatrics, obstetrics,[and --] gynecology] or who are diplomats of one of the above certifying boards approved by the American Board of Medical Specialties or one of the certifying boards of the American Osteopathic Association.
E. Verification Responsibilities, a MCO shall:
1. Obtain primary verification of at least the following information about the applicant:
a) Current license, certification, or registration to render health care in Delaware and history of same;
b) Current level of professional liability coverage, if applicable;
c) Status of hospital privileges, if applicable;
d) Specialty board certification status, if applicable; and
e) Current Drug Enforcement Agency (DEA) registration certificate, if applicable.
2. Obtain, subject to either primary or secondary verification:
a) The health care professional’s record from the National Practitioner Data Bank; and
b) The health care professional’s malpractice history.
3. Not less than every three (3) years obtain primary verification of a participating health care professional’s:
a) Current license or certification to render health care in Delaware;
b) Current level of professional liability coverage, if applicable;
c) Status of hospital privileges, if applicable;
d) Current DEA registration certificate, if applicable; and
e) Specialty board certification status, if applicable.
4. Require all participating providers to notify the MCO of changes in the status of any of the items listed in this section at any time and identify for participating providers the individual to whom they should report changes in the status of an item listed in this section.
F. Health Care Professionals Right to Review Credentialing Verification Information
1. A MCO shall provide a health care professional the opportunity to review and correct information submitted in support of that health care professional’s credentialing verification application as set forth below.
a) Each health care professional who is subject to the credentialing verification process shall have the right to review all information, including the source of that information, obtained by the MCO to satisfy the requirements of this section during the MCO’s credentialing process.
b) A MCO shall notify a health care professional of any information obtained during the MCO’s credentialing verification process that does not meet the MCO’s credentialing verification standards or that varies substantially from the information provided to the MCO by the health care professional, except that the MCO shall not be required to reveal the source of information if the information is not obtained to meet this requirement, or if disclosure is prohibited by law.
c) A health care professional shall have the right to correct any erroneous information. The MCO shall have a formal process by which a health care professional may submit supplemental or corrected information to the MCO’s credentialing verification committee and request a reconsideration of the health professional’s credentialing verification application if the health care professional feels that the MCO’s credentialing verification committee has received information that is incorrect or misleading. Supplemental information shall be subject to confirmation by the MCO.
69.402 Provider Network Adequacy
A. Primary, Specialty and Ancillary Providers
1. The MCO shall maintain an adequate network of primary care providers, specialists, and other ancillary health care resources to serve the enrolled population at all times. The MCO shall develop and submit annually to the Department policies and procedures for measuring and assessing the adequacy of the network. At a minimum, the network of providers shall include:
a) A sufficient number of licensed primary care providers under contract with the MCO to provide basic health care services. All enrollees must have immediate telephone access seven (7) days a week, 24 hours a day, to their primary care provider or his/her authorized on-call back-up provider;
b) A sufficient number of licensed medical specialists available to MCO enrollees to provide medically-necessary specialty care. The MCO must have a policy assuring reasonable access to frequently used specialists within each service area; and
c) A sufficient number of other health professional staff including but not limited to licensed nurses and other professionals available to MCO enrollees to provide basic health care services. The MCO shall cover nonparticipating providers at no extra cost to the enrollee if a plan has an insufficient number of providers within reasonable geographic distances and appointment times to meet the medical needs of the enrollee.
B. Facility and Ancillary Health Care Services
1. The MCO shall maintain contracts or other arrangements acceptable to the Department with institutional providers which have the capability to meet the medical needs of enrollees and are geographically accessible. The network of providers shall include:
a) At least one licensed acute care hospital including at least licensed medical-surgical, pediatric, obstetrical, and critical care services in any service area no greater than 30 miles or 40 minutes driving time from 90% of enrollees within the service area.
b) Surgical facilities including acute care hospitals for major surgery, and for minor surgical procedures, hospitals, licensed ambulatory surgical facilities, and/or physicians surgical practices available in each service area no greater than 30 miles or 40 minutes driving time from 90% of enrollees within the service area.
c) The MCO shall have a policy assuring access, as evidenced by contract or other agreement acceptable to the Department, to the following specialized services, as determined to be medically necessary. Such services shall be reasonably accessible and shall include:
(1) At least one hospital providing regional perinatal services;
(2) A hospital offering pediatric intensive care services;
(3) A hospital offering neonatal intensive care services;
(4) Therapeutic radiation provider;
(5) Magnetic resonance imaging center;
(6) Diagnostic radiology provider, including X-ray, ultrasound, and CAT scan;
(7) Emergency mental health service;
(8) Diagnostic cardiac catheterization services in a hospital;
(9) Specialty pediatric outpatient centers for conditions including sickle cell, hemophilia, cleft lip and palate, and congenital anomalies;
(10) Clinical Laboratory certified under CLIA; and
(11) Certified renal dialysis provider.
d) The MCO shall make acceptable service arrangements with the provider and enrollee if the appropriate level of service is not available at no extra cost to the enrollee. These services will not be limited to the State of Delaware. These services could include but are not limited to tertiary services, burn units and transplant services.
2. If offered by the plan, the MCO shall have a policy assuring access, as evidenced by contract or other agreement acceptable to the Department, to the following specialized services, as determined to be medically necessary. Such services shall be reasonably accessible and may include:
a) A licensed long term care facility with skilled nursing beds;
b) Residential substance abuse treatment center;
c) Inpatient psychiatric services for adults and children;
d) Short term care facility for involuntary psychiatric admissions;
e) Outpatient therapy providers for mental health and substance abuse conditions;
f) Home health agency licensed by the Department;
g) Hospice program licensed by the Department; and
h) Pharmacy services.
3. The MCO shall make acceptable service arrangements with the provider and enrollee if the appropriate level of service is not available in the service area at no extra cost to the enrollee.
C. Emergency and Urgent Care Services
1. The MCO shall establish written policies and procedures governing the provision of emergency and urgent care which shall be distributed to each enrollee at the time of initial enrollment and after any revisions are made. These policies shall be easily understood by a lay person.
2. Enrollees shall have access to emergency care (as defined at 69.107) 24 hours per day, seven (7) days per week. The MCO shall cover emergency care necessary to screen and stabilize an enrollee and shall not require prior authorization of such services if a prudent lay person acting reasonably would have believed that an emergency medical condition (as defined at 69.108) existed.
3. Emergency and urgent care services shall include but are not limited to:
a) Medical and psychiatric care, which shall be available 24 hours a day, seven (7) days a week;
b) Trauma services at any designated Level I or II trauma center as medically necessary. Such coverage shall continue at least until the enrollee is medically stable, no longer requires critical care, and can be safely transferred to another facility, in the judgment of the attending physician. If the MCO requests transfer to a hospital participating in the MCO network, the patient must be stabilized and the transfer effected in accordance with federal regulations at 42 CFR 489.20 and 42 CFR 489.24;
c) Out of area health care for urgent or emergency conditions where the enrollee cannot reasonably access in-network services;
d) Hospital services for emergency care; and
e) Upon arrival in a hospital, a medical screening examination, as required under federal law, as necessary to determine whether an emergency medical condition exists.
D. All enrollees shall be provided with an up-to-date and comprehensive list of the provider network upon enrollment and upon request and an update on provider changes at least quarterly.
69.403 Utilization Management
A. Utilization Management Functions
1. The MCO shall establish and implement a comprehensive utilization management program to monitor access to and appropriate utilization of health care and services. The program shall be under the direction of a designated physician and shall be based on a written plan that is reviewed at least annually. The plan shall identify at least:
a) Scope of utilization management activities;
b) Procedures to evaluate clinical necessity, access, appropriateness, and efficiency of services;
c) Mechanisms to detect under utilization;
d) Clinical review criteria and protocols used in decision-making;
e) Mechanisms to ensure consistent application of review criteria and uniform decisions;
f) System for providers and enrollees to appeal utilization management determinations in accordance with the procedures set forth; and
g) A mechanism to evaluate enrollee and provider satisfaction with the complaint and appeals systems set forth. Such evaluation shall be coordinated with the performance monitoring activities conducted pursuant to the continuous quality improvement program set forth.
2. Utilization management determinations shall be based on written clinical criteria and protocols reviewed and approved by practicing physicians and other licensed health care providers within the network. These criteria and protocols shall be periodically reviewed and updated, and shall, with the exception of internal or proprietary quantitative thresholds for utilization management, be readily available, upon request, to affected providers and enrollees. All materials including internal or proprietary materials for utilization management shall be available to the Department upon request.
3. Compensation to persons providing utilization review services for a MCO shall not contain incentives, direct or indirect, for these persons to make inappropriate review decisions. Compensation to any such persons may not be based, directly or indirectly, on the quantity or type of adverse determinations rendered.
B. Utilization Management Staff Availability
1. At a minimum, appropriately qualified staff shall be immediately available by telephone, during routine provider work hours, to render utilization management determinations for providers.
2. The MCO shall provide enrollees with a toll free telephone number by which to contact customer service staff on at least a five (5) day, 40 hours a week basis.
3. The MCO shall supply providers with a toll free telephone number by which to contact utilization management staff on at least a five (5) day, 40 hours a week basis.
4. The MCO must have policies and procedures addressing response to inquiries concerning emergency or urgent care when a PCP or his/her authorized on call back up provider is unavailable.
C. Utilization Management Determinations
1. All determinations to authorize services shall be rendered by appropriately qualified staff.
2. All determinations to deny or limit an admission, service, procedure or extension of stay shall be rendered by a physician. The physician shall be under the clinical direction of the medical director responsible for medical services provided to the MCO’s Delaware enrollees. Such determinations shall be made in accordance with clinical and medical criteria and standards and shall take into account the individualized needs of the enrollee for whom the service, admission, procedure is requested.
3. All determinations shall be made on a timely basis as required by the exigencies of the situation.
4. A MCO may not retroactively deny reimbursement for a covered service provided to an enrollee by a provider who relied upon the written or verbal authorization of the MCO or its agents prior to providing the service to the enrollee, except in cases where the MCO can show that there was material misrepresentation, fraud or the patient was found not to have coverage.
5. An enrollee must receive upon request a written notice of all determinations to deny coverage or authorization for services required and the basis for the denial.
69.404 Grievance/Appeal Procedure
A. Enrollees Rights in Grievance/Appeal Procedure
1. All MCO enrollees, or any provider acting on behalf of an enrollee with the enrollee’s consent, may appeal any utilization management determination resulting in a denial, termination, or other limitation of covered health care services. All enrollees and providers shall be provided with a written explanation of the appeal process upon enrollment, upon request and each time the methods and procedures are substantially changed and at least annually. The appeal process shall consist of an informal internal review by the MCO (Stage 1 appeal), a formal internal review by the MCO (Stage 2 appeal), and a formal external review (Stage 3 appeal) by an independent utilization review organization.
2. No enrollee who exercises the right to an appeal shall be subject to disenrollment, contract termination or otherwise penalized by the MCO solely on the basis of filing any such appeal.
3. At any stage of the appeal process, at the request of an enrollee, the MCO shall appoint a member of its staff who has no direct involvement in the case to represent the enrollee. An enrollee appealing a determination shall be specifically notified of the enrollee’s right to have a staff member appointed to assist the enrollee.
4. The MCO shall maintain written records to document all appeals received (a “grievance register”). For each grievance the register shall contain, at a minimum, the following information:
a) A general description of the reason for the grievance;
b) Date received;
c) Date of each review;
d) Resolution at each level of appeal;
e) Date of resolution at each level; and
f) Name of the enrollee for whom the grievance was filed.
B. Informal Internal Utilization Management Appeal Process (Stage 1)
Each MCO shall establish and maintain an informal internal appeal process (Stage 1) whereby any enrollee or any provider acting on behalf of an enrollee with the enrollee’s consent, who is dissatisfied with any MCO utilization management determination, shall have the opportunity to discuss and appeal that determination with the MCO’s medical director and/or the physician designee who rendered the determination. All such Stage 1 appeals shall be concluded as soon as possible in accordance with the medical exigencies of the case. In no event shall appeals involving an imminent, emergent or serious threat to the health of the enrollee exceed 72 hours. All other Stage 1 appeals shall be concluded within five (5) business days. If the appeal is not resolved to the satisfaction of the enrollee at this level, the MCO shall provide the enrollee and/or the provider with a written explanation of his/her right to proceed to a Stage 2 appeal.
C. Formal Internal Utilization Management Appeal Process (Stage 2)
1. Each MCO shall establish and maintain a formal internal appeal process (Stage 2 appeal) whereby any enrollee or any provider acting on behalf of an enrollee with the enrollee’s consent, who is dissatisfied with the results of the Stage 1 appeal, shall have the opportunity to pursue his/her appeal before a panel of physicians and/or other health care professionals selected by the MCO who have not been involved in the utilization management determination at issue. An enrollee has the right to:
a) Attend the Stage 2 appeal;
b) Present his or her case to the review panel;
c) Submit supporting material both before and at the review meeting;
d) Ask questions of any representative of the MCO participating on the panel; and
e) Be assisted or represented by a person of his or her choice.
2. Upon the request of an enrollee, a MCO shall provide to the enrollee all relevant information that is not confidential or privileged.
3. The enrollee’s right to a fair review shall not be made conditional on the enrollee’s appearance at the review.
4. The formal internal utilization management appeal panel shall have available consultant practitioners who are trained or who practice in the same specialty as would typically manage the case at issue or such other licensed health care professional as may be mutually agreed upon by the parties. In no event, however, shall the consulting practitioner or professional have been involved in the utilization management determination at issue. The consulting practitioner or professional shall participate in the panel’s review of the case if requested by the enrollee and/or provider.
5. All such Stage 2 appeals must be acknowledged by the MCO, in writing, to the enrollee or provider filing the appeal within fourteen (14) calendar days of receipt.
6. All such Stage 2 appeals shall be concluded as soon as possible after receipt by the MCO in accordance with the medical exigencies of the case. In no event shall appeals involving an imminent, emergent or serious threat to the health of the enrollee exceed 72 hours. Except as set forth in paragraph (7) below, all other Stage 2 appeals shall be concluded within thirty (30) calendar days of receipt.
7. The MCO may extend the review for up to an additional thirty (30) calendar days where it can demonstrate reasonable cause for the delay beyond its control and where it provides a written progress report and explanation for the delay to the enrollee and/or provider within the original thirty (30) calendar day review period. In no event, however, may the review period applicable to appeals from determinations regarding urgent or emergent care be so extended.
8. The review panel shall issue a written decision to the enrollee. The decision shall include:
a) The names and titles of the members of the review panel;
b) A statement of the review panel’s understanding of the nature of the grievance and all pertinent facts;
c) The rationale for the review panel’s decision;
d) Reference to evidence or documentation considered by the review panel in making that decision;
e) In cases involving an adverse determination, the instructions for requesting a written statement of the clinical rationale, including the clinical review criteria used to make the determination; and
f) A written notification of his/her right to proceed to an external (Stage 3) appeal.
9. In the event that the MCO fails to comply with any of the deadlines for completion of the internal utilization management determination appeals set forth or in the event that the MCO for any reason expressly waives its rights to an internal review of any appeal, then the enrollee and/or provider shall be relieved of his/her obligation to complete the MCO internal review process and may, at his/her option, proceed directly to the external appeals process.
D. External Utilization Appeal Process (Stage 3)
1. Each MCO shall establish and maintain a formal external review process (Stage 3) whereby any enrollee or any provider acting on behalf of an enrollee with the enrollee’s consent, who is dissatisfied with the results of the Stage 2 appeal, shall have the opportunity to pursue his/her appeal before an independent utilization review organization.
2. The review panel shall schedule and hold a review meeting within forty-five (45) calendar days of receiving a request from an enrollee for a Stage 3 appeal. The review meeting shall be held during regular business hours at a location reasonably accessible to the enrollee. In cases where a face-to-face meeting is not practical for geographic reasons, a MCO shall offer the enrollee the opportunity to communicate with the review panel, at the MCO’s expense, by conference call, video conferencing, or other appropriate technology. The enrollee shall be notified, in writing, at least fifteen (15) calendar days in advance of the review date. The MCO shall not unreasonably deny a request for postponement of the review made by an enrollee.
3. Upon the request of an enrollee, a MCO shall provide to the enrollee all relevant information that is not confidential or privileged.
4. An enrollee has the right to:
a) Attend the Stage 3 review;
b) Present his or her case to the review panel;
c) Submit supporting material both before and at the review meeting;
d) Ask questions of any representative of the MCO participating on the panel; and
e) Be assisted or represented by a person of his or her choice.
5. The enrollee’s right to a fair review shall not be made conditional on the enrollee’s appearance at the review.
6. The review panel shall issue a written decision to the enrollee within five (5) business days of completing the review meeting. The decision shall include:
a) The names and titles of the members of the review panel;
b) A statement of the review panel’s understanding of the nature of the grievance and all pertinent facts;
c) The rationale for the review panel’s decision;
d) Reference to evidence or documentation considered by the review panel in making that decision; and
e) In cases involving an adverse determination, the instructions for requesting a written statement of the clinical rationale, including the clinical review criteria used to make the determination.
E. The MCO shall include in its annual reports to the Department a description of the total number of grievances handled, the number of grievances handled at each level of appeal, a compilation of the causes underlying the appeals, and the resolution of the appeals.
69.405 Quality Assessment and Improvement
A. Continuous Quality Improvement
1. Under the direction of the Medical Director or his/her designated physician, the MCO shall have a system-wide continuous quality improvement program to monitor the quality and appropriateness of care and services provided to enrollees. This program shall be based on a written plan which is reviewed at least semi-annually and revised as necessary. The plan shall describe at least:
a) The scope and purpose of the program;
b) The organizational structure of quality improvement activities;
c) Duties and responsibilities of the medical director and/or designated physician responsible for continuous quality improvement activities;
d) Contractual arrangements, where appropriate, for delegation of quality improvement activities;
e) Confidentiality policies and procedures;
f) Specification of standards of care, criteria and procedures for the assessment of the quality of services provided and the adequacy and appropriateness of health care resources utilized;
g) A system of ongoing evaluation activities, including individual case reviews as well as pattern analysis;
h) A system of focused evaluation activities, particularly for frequently performed and/or highly specialized procedures;
i) A system of monitoring enrollee satisfaction and network provider’s response and feedback on MCO operations;
j) A system for verification of provider’s credentials, recertification, performance reviews and obtaining information about any disciplinary action against the provider available from the Delaware Board of Medical Practice or any other state licensing board applicable to the provider;
k) The procedures for conducting peer review activities which shall include providers within the same discipline and area of clinical practice; and
l) A system for evaluation of the effectiveness of the continuous quality improvement program.
2. There shall be a multidisciplinary continuous quality improvement committee responsible for the implementation and operations of the program. The structure of the committee shall include representation from the medical, nursing and administrative staff, with substantial involvement of the medical director of the MCO.
3. The MCO shall assure that participating providers have the opportunity to participate in developing, implementing and evaluating the quality improvement system.
4. The MCO shall provide enrollees the opportunity to comment on the quality improvement process.
5. The program shall monitor the availability, accessibility, continuity and quality of care on an ongoing basis. Indicators of quality care for evaluating the health care services provided by all participating providers shall be identified and established and shall include at least:
a) A mechanism for monitoring enrollee appointment and triage procedures including wait times to get an appointment and wait times in the office;
b) A mechanism for monitoring enrollee continuity of care and discharge planning for both inpatient and outpatient services;
c) A mechanism for monitoring the appropriateness of specific diagnostic and therapeutic procedures as selected by the continuous quality improvement program;
d) A mechanism for evaluating all providers of care that is supplemental to each provider’s quality improvement system;
e) A mechanism for monitoring network adequacy and accessibility to assure the network services the needs of their diverse enrolled population; and
f) A system to monitor provider and enrollee access to utilization management services including at least waiting times to respond to telephone requests for service authorization, enrollee urgent care inquiries, and other services required.
6. The MCO shall develop a performance and outcome measurement system for monitoring and evaluating the quality of care provided to MCO enrollees. The performance and outcome measures shall include population-based and patient-centered indicators of quality of care, appropriateness, access, utilization, and satisfaction. Data for these performance measures shall include but not be limited to the following:
a) Indicator data collected by MCOs from chart reviews and administrative data bases;
b) Enrollee satisfaction surveys;
c) Provider surveys;
d) Annual reports submitted by MCOs to the Department; and
e) Computerized health care encounter data.
7. The MCO shall follow-up on findings from the program to assure that effective corrective actions have been taken, including at least policy revisions, procedural changes and implementation of educational activities for enrollees and providers.
8. Continuous quality improvement activities shall be coordinated with other performance monitoring activities including utilization management and monitoring of enrollee and provider complaints.
9. The MCO shall maintain documentation of the quality improvement program in a confidential manner. This documentation shall be available to the Department and shall include:
a) Minutes of quality improvement committee meetings; and
b) Records of evaluation activities, performance measures, quality indicators and corrective plans and their results or outcomes.
B. External Quality Audit
1. Each MCO shall submit, as a part of its annual report due June 1, evidence of its most recent external quality audit that has been conducted. External quality audits must be completed no less frequently than once every three (3) years. Such audit shall be performed by an independent quality review organization approved by the Department.
2. The report must describe in detail the MCOs conformance to performance standards and the rules within these regulations. The report shall also describe in detail any corrective actions proposed and/or undertaken by the MCO.
C. Reporting and Disclosure Requirements
1. The Board of Directors of the MCO shall be kept apprised of continuous quality improvement activities and be provided at least annually with regular written reports from the program delineating quality improvements, performance measures used and their results, and demonstrated improvements in clinical and service quality.
2. A MCO shall document and communicate information about its quality assessment program and its quality improvement program, and shall:
a) Include a summary of its quality assessment and quality improvement programs in marketing materials;
b) Include a description of its quality assessment and quality improvement programs and a statement of enrollee rights and responsibilities with respect to those programs in the materials or handbook provided to enrollees; and
c) Make available annually to providers and enrollees findings from its quality assessment and quality improvement programs and information about its progress in meeting internal goals and external standards, where available. The reports shall include a description of the methods used to assess each specific area and an explanation of how any assumptions affect the findings.
3. MCOs shall submit such performance and outcome data as the Department may request.
PART FIVE
SECTION 69.5 ENROLLEE RIGHTS AND RESPONSIBILITIES
69.501 The MCO shall establish and implement written policies and procedures regarding the rights of enrollees and the implementation of these rights.
69.502 In the case of nonpayment by the MCO to a provider for a covered service in accordance with the enrollee’s health care contract, the provider may not bill the enrollee. This does not prohibit the provider from collecting coinsurance, deductibles or co-payments as determined by the MCO. This does not prohibit the provider and enrollee from agreeing to continue services solely at the expense of the enrollee, as long as the provider clearly informs the enrollee that the MCO will not cover these services.
69.503 The MCO shall permit enrollees to choose their own primary care physician from a list of health care professionals within the plan. This list shall be updated as health care professionals are added or removed and shall include:
A. a sufficient number of primary care physicians who are accepting new enrollees; and
B. a sufficient number of primary care physicians that reflects a diversity that is adequate to meet the diversity needs of the enrolled populations varied characteristics including age, gender, language, race and health status.
69.504 The MCO shall provide each enrollee with an enrollee’s benefit handbook which includes a complete statement of the enrollee’s rights, a description of all complaint and grievance procedures, a clear and complete summary of the evidence of coverage, and notification of their personal financial obligations for non- covered services. The statement of the enrollee’s rights shall include at least the right:
A. To available and accessible services when medically necessary, including availability of care 24 hours a day, seven (7) days a week for urgent or emergency conditions;
B. To be treated with courtesy and consideration, and with respect for the enrollee’s dignity and need for privacy;
C. To be provided with information concerning the MCO’s policies and procedures regarding products, services, providers, grievance/appeal procedures and other information about the organization and the care provided;
D. To choose a primary care provider within the limits of the covered benefits and plan network, including the right to refuse care of specific practitioners;
E. To receive from the enrollee’s physician(s) or provider, in terms that the enrollee understands, an explanation of his/her complete medical condition, recommended treatment, risk(s) of the treatment, expected results and reasonable medical alternatives. If the enrollee is not capable of understanding the information, the explanation shall be provided to his/her next of kin or guardian and documented in the enrollee’s medical record;
F. To formulate advance directives;
G. To all the rights afforded by law or regulation as a patient in a licensed health care facility, including the right to refuse medication and treatment after possible consequences of this decision have been explained in language the enrollee understands;
H. To prompt notification, as required in these rules, of termination or changes in benefits, services or provider network;
I. To file a complaint or appeal with the MCO and to receive an answer to those complaints within a reasonable period of time; and
J. To file a complaint with the Department or the Commissioner.
69.505 The MCO shall establish and implement written policies and procedures regarding the responsibilities of enrollees. A complete statement of these responsibilities shall be included in the enrollee’s benefit handbook.
69.506 The MCO shall disclose to each new enrollee, and any enrollee upon request, in a format and language understandable to a lay person, the following minimum information:
A. Benefits covered and limitations;
B. Out of pocket costs to the enrollee;
C. Lists of participating providers;
D. Policies on the use of primary care physicians, referrals, use of out of network providers, and out of area services;
E. Written explanation of the appeals process;
F. A description of and findings from the quality assurance and improvement programs;
G. The patterns of utilization of services; and
H. For staff model MCOs, the location and hours of its inpatient and outpatient health services.
69.507 The MCO shall provide culturally competent services to the greatest extent possible.
PART SIX
SECTION 69.6 REQUIREMENTS FOR STAFF MODEL MCOs
In addition to all other requirements of these regulations, staff model MCOs shall meet the requirements of this section.
69.601 Environmental Health and Safety
A. Office premises and other structures operated by the MCO must have appropriate safeguards for patients.
B. All buildings shall conform to all State and medical codes and all regulations applicable to services being offered. These codes shall include but are not limited to:
1. State Plumbing Code.
2. Waste Disposal Regulations.
3. Public Water Supply Regulations.
4. Food Service Requirements.
5. Radiation Control Regulations.
6. Hazardous Waste Regulations.
7. Air and Water Pollution Regulations.
8. Hand washing facilities shall be installed in accordance with applicable State and local regulations and conveniently located.
9. Toilet facilities shall meet appropriate State and local regulations.
10. State Fire Code requirements.
C. The buildings must be architecturally accessible to handicapped individuals and comply with the Americans with Disabilities Act.
D. Measures must be taken to insure that facilities are guarded against insects and rodents.
E. Housekeeping
1. A housekeeping procedures manual shall be written and followed. Special emphasis shall be given to procedures applying to infectious diseases or suspect areas.
2. All premises shall be kept neat, clean, free of litter and rubbish.
3. Walls and ceilings shall be maintained free of cracks and falling plaster and shall be cleaned and painted regularly.
4. Floors shall be cleaned regularly and in such a manner that it will minimize the spread of pathogenic organisms in the atmosphere; dry dusting and sweeping shall be prohibited.
5. Suitable equipment and supplies shall be provided for cleaning all surfaces.
6. Solutions, cleaning compounds and hazardous substances shall be properly labeled and stored in safe places.
69.602 Emergency Utilities or Facilities
A. The MCO shall be equipped to handle emergencies due to equipment failures. Emergency electrical service for lighting and power for equipment essential to life safety shall be provided in accordance with hospital regulations where appropriate. (Minimum Requirements for Construction of Hospital and Health Care Facilities, Section 7.32H.)
B. In facilities which provide hospital services, the emergency electrical system shall be so controlled that the auxiliary power is brought to full voltage and frequency and be connected within ten (10) seconds.
C. Emergency utilities for MCOs and contract providers must be supplied according to procedures performed on the premises.
69.603 Construction
A. New construction or substantial modifications on an existing facility shall conform to applicable State, county and local codes, including the National Fire Protection Association Publication No. 101 - Life Safety Code, latest edition adopted by the State Fire Prevention Board.
B. Radiation requirements of the Authority on Radiation Protection shall be met.
C. Facility plans or modifications shall be submitted to the Department for review and approval prior to any work being begun.
69.604 Personnel
A. The office shall be staffed by appropriately trained personnel. Appropriate manuals shall be developed to serve as guidelines and set standards for patient care provided by nonprofessional personnel.
B. Offices with five (5) or more physicians shall have at least one (1) full time registered nurse (RN).
C. Nonprofessional personnel shall have appropriate in-service education on clinical operations and procedures. The in-service training program must be conducted at least annually.
D. Primary physician. There shall be at least one (1) full time or full time equivalent physician available on contract. There shall be at least one (1) F.T.E. primary physician for every 1,000 enrollees.
E. Medical Specialties. There shall be either full time or part-time physicians, other appropriate professional specialists, or written agreements adequate to ensure access to all needed services for enrollees.[for consultation in internal medicine, pediatrics, general surgery, oral surgery, ENT, obstretics and gynecology, orthopedic surgery, ophthalmology, pharmacy, radiology, physical therapy, psychiatry, nutrition and other reasonable services.]
69.605 Equipment
Each office operated by the MCO must have the necessary equipment and instruments to provide the required services. Equipment and instruments for services, when covered by written contract with medical specialists or other providers outside of the office, need not be present in the MCO’s office. Where emergency services are provided in the office, equipment such as a defibrillator, laryngoscope and other similar equipment must be present.
69.606 Specialized Services
A. The MCO shall provide special services necessary for diagnosis and treatment such as ultra sound. Where it is not feasible to provide these services in the office, there shall be a written agreement for these services in a nearby location except for isolated rural areas where arrangements for these services shall be subject to review and approval by the Department.
1. The MCO’s radiology services shall be supervised and conducted by a qualified radiologist, either full time or part-time; or, when radiology services are supervised and conducted by a physician who is not a qualified radiologist, the MCO shall provide for regular consultation by a qualified radiologist, who is under contract with the MCO and is responsible for reviewing all X-rays and procedures. The number of qualified radiological technologists employed shall be sufficient to meet the MCO’s requirements. If the MCO operates a radiology service and provides emergency services, at least one (1) qualified technologist shall be on duty or on call at all times.
2. Pharmaceutical services, when provided by the MCO, must be under the direct supervision of a registered pharmacist who is responsible to the administrative staff for developing, coordinating and supervising all pharmaceutical services; or, in the case of dispensing of pharmaceuticals by a physician, such dispensing shall not violate the requirements of State law. MCOs with a licensed pharmacy shall have a Pharmacy and Therapeutics Committee. Pharmaceutical services may be provided on the premises of the MCO or by contract with an independent licensed provider. The contract shall be available for inspection by the Department at all times.
3. When the MCO provides its own emergency services, facilities must be provided to ensure prompt diagnosis and emergency treatment including adequate Emergency Room space, separate from major surgical suites. In Emergency Room facilities provided for or arranged for by the MCO there shall be as a minimum: adequate oxygen, suction, CPR, diagnostic equipment, as well as standard emergency drugs, parenteral fluids, blood or plasma substitutes and surgical supplies. Radiology facilities, clinical laboratory facilities and current toxicology including antidotes shall be available at all times.
4. Personnel shall be trained and approved by an appropriate professional organization in the operation and procedures of emergency equipment.
69.607 Central Sterilizing and Supply
Autoclaves or other acceptable sterilization equipment shall be provided of a type capable of meeting the needs of the MCO and of a recognized type with approved controls and safety features. Bacteriological culture tests shall be conducted at least monthly. The maintenance program of the sterilization system shall be under the supervision of competent trained personnel.
PART SEVEN
SECTION 69.7 ADMINISTRATIVE REQUIREMENTS
69.701 Administration
The MCO shall designate an appropriate person or persons to handle the administrative functions of the MCO. These functions shall include the following responsibilities: interpretation, implementation and application of policies and programs established by the MCO’s governing authority; establishment of safe, effective and efficient administrative management; control and operation of the services provided; authority to monitor or supervise the operation and in accordance with acceptable medical standards; and such other duties, responsibilities and tasks as the governing body or other designated authority may empower such individual(s).
69.702 Qualifications
Persons appointed to administrative positions in the MCO shall have the necessary current training and experience in the field of health care as appropriate to carry out the functions of their job descriptions.
69.703 Medical Privileges
Participating physicians shall have hospital privileges commensurate with their contractual obligations. Physicians must be licensed in Delaware.
69.704 Medical Records
The MCO must maintain or provide for the maintenance of a medical records system which meets the accepted standards of the health care industry and the regulations of the Department.
A. These records shall include the following information: name, identification number, age, sex, residence, employment, patient history, physical examination, laboratory data, diagnosis, treatment prescribed and drugs administered.
B. The medical record should also contain an abstract summary of any inpatient hospital care or referred treatment.
C. Regulatory agencies shall have access to medical records for purposes of monitoring and review of MCO practices.
D. Enrollees’ records shall be filed for five (5) years following active status before being destroyed.
69.705 Reporting Requirements and Statistics
The MCO shall submit reports as required by these regulations.
A. The MCO shall disclose to its enrollees the following information:
1. the patterns of utilization of its services based on the information in 69.405 A 6.; and
2. the location and hours of its inpatient and outpatient health services.
B. The following information is required to be submitted to the Department on an annual basis:
1. Physician visits per enrollee per year.
2. Hospital admissions per year and per 1,000 enrollees per year.
3. Hospital days per year and per 1,000 enrollees per year.
4. Average length of stay per hospital confinement.
5. Outside consultations per year and per 1,000 enrollees per year.
6. Emergency Room visits per year and per 1,000 enrollees per year.
7. Laboratory procedures per year and per 1,000 enrollees per year.
8. X-ray procedures per year and per 1,000 enrollees per year.
9. Total number of enrollees at the end of the year.
10. Total number of enrollees enrolled during the year.
11. Total number of enrollees terminated during the year.
12. Cost of operation.
13. Current provider directory including PCPs, specialists, facilities and ancillary health care services.
14. A statistical summary evaluating the network adequacy and accessibility to the enrolled population.
15. Annual grievance/appeal report including total number of appeals, number of appeals at each grievance level, reason for appeals and resolution of appeals.
C. The following administrative reports are required by the Department whenever there is a change:
1. Full name of the Chief Executive Officer.
2. Full name of the Medical Director.
3. Address(es) of the office(s) in operation.
4. Name(s) of the hospital(s) used by the MCO
Appendix A
A. IDENTIFYING INFORMATION
1. Name of applicant: _______________________
Address ______________________________________
_____________________________________
Telephone: _______________________________
2. Chief Executive Officer: ____________________
3. Type of MCO: (Check one)
Staff o Group Practice o
Individual Practice Association o
Other ______________________________________
4. Anticipated date of operation: ________________
5. Area of operation, i.e., county or statewide:______________________________________
B. Statement of Certification and Acknowledgment:
I certify that the statements made in this application are accurate, complete, and current to the best of my knowledge and belief. I understand that this application does not relieve me of any responsibility under Part VIII, Title 16, Chapter 93 of the Delaware Code (Certificate of Need).
___________________ _________ _________
Signature of Chief Title Date
Executive Officer
C. Fee Schedule Checks should be made payable to: State of Delaware
Application Fee: $375.00
Filing of Annual Report: $250.00
D. Please return this application to:
Health Facilities Licensing & Certification
3 Mill Road, Suite 308
Wilmington, DE 19806