2005 LEGISLATIVE UPDATE

The Medicaid Reform Bill was the most comprehensive healthcare legislation that passed during the 2005 Session. The Bill contains both short and long-term Medicaid reform activities, pilot projects and it opens the way for significant changes in the reimbursement procedures for providers of health care services.

The Agency for Heath Care Administration is currently in the process of submitting applications for waivers to be approved by the federal government WOW waivers are approved, the implementation must be reviewed and approved by the Florida House and Senate. A Special Session to address these issues is expected to be called in November or December 2005.

The Medicaid Reform Bill (Committee Substitute Senate Bill 838) is designed to improve efficiency and achieve sustainable growth in Florida's Medicaid program. Specifically, the Bill:

Requires the Agency for Health Care Administration (AHCA) to contract with a vendor to identify and counsel providers whose clinical practice patterns are outside normal practice patterns in order to improve patient care and reduce inappropriate utilization.

Authorizes AHCA to use more single-source contracting to reduce costs, without limiting access to cue.

Requires AHCA to determine if purchasing medical equipment is less expensive than renting equipment and authorizes AHCA to facilitate purchases in lieu of long-term rentals in order to protect against fraud and abuse.

Requires that provider service network contracts currently in effect be extended for a period of three years and provides a definition for a provider service network.

Directs AHCA to pilot test an integrated, fixed-payment, long-term care delivery system in two non-designated areas of the state, with one site having voluntary participation and one site having mandatory participation. The bill specifies the types of long-term care to be combined under the system and the types of health plans that can participate in the system. Implementation of the long-term care delivery system is contingent upon the approval of the federal waiver by the Legislature. The Office of Program Policy Analysis and Government Accountability (OPPAGA) is directed to evaluate the long-term care pilot program.

Requires AHCA to consider business cases for changing reimbursement rates for certain services if the change reduces costs in other parts of the Medicaid program.

Requires the Comprehensive Assessment and Review for Long-term Care Services (CARES) staff to identify Medicare patients in nursing homes who are being inappropriately disqualified from coverage under Medicare and assist with appeal of the disqualification, contingent on whether this authority is determined to be a reimbursable service under Medicaid rules.

Requires AHCA to contract with an entity to develop a real-time utilization tracking system or electro medical record for Medicaid recipients;

Requires AHCA to develop emergency department diversion programs in conjunction with those being developed in the private sector;

Modifies the Medicaid prescription drug utilization program to permit dispensing practitioners to participate in the Medicaid pharmacy network regardless of their proximity to other dispensing entities. The Bill requires AHCA to implement a prescription-drug-management system to coordinate proper clinical practices among physicians and pharmacists. The bill requires AHCA to study whether its reuse program can be expanded to reduce the unnecessary destruction of drugs;

Allows mental health crisis care to be provided in licensed crisis-stabilization facilities if it is less costly;

Specifies waiver authority for AHCA to establish a statewide Medicaid reform initiative contingent upon federal approval to preserve the upper-payment-limit funding mechanism for hospitals and contingent upon protection of the disproportionate share program authorized pursuant to ch. 409, F.S. It further provides that phase one of this demonstration project shall be implemented in two geographical areas. One site shall include only Broward County, a second site shall initially include Duval County and shall be expanded to include Baker, Clay, and Nassau Counties within one year after the Duval County program becomes operational. Upon completion of the evaluation, after 24 months of operation of the pilot projects, AHCA may request statewide expansion. Statewide phase-in to additional counties is contingent upon review and approval of the Legislature.

The Bill enumerates the powers, duties, and responsibilities AHCA shall have with respect to the development of the demonstration program. AHCA is required to:

1. Include the delivery of all mandatory services specified in s. 409.905, F.S., and optional services specified in s. 409.906, ITS, as approved by the Centers for Medicare and Medicaid Services and the Legislature. Services to recipients under plan benefits are required to include emergency services;

2. Recommend Medicaid-eligibility categories to be included in the program;

3. Determine and recommend actuarially sound, risk-adjusted capitation rates;

4. Determine and recommend program standards and credentialing requirements for health plans to participate in the program including allowing federally-qualified health centers, federally qualified rural health clinics, county health departments, and other public providers to participate in the reform program if willing;

5. Develop a system for assisting recipients in choosing among health plans in the program choice counseling), including types of materials that must be provided, multi-lingual requirements, anti-fraud and recipient recruiting requirements, verification requirements that a recipient received choice counseling; and authority to allow the agency to contract for the service;

6. Develop a grievance procedure for recipients and providers;

7. Develop and recommend a monitoring system to prevent fraud and abuse by plans, their providers, and recipients;

8. Develop a system where plans compensate school districts for services they must provide to their students on Medicaid;

9. Develop a system that addresses special needs of children with chronic medical conditions, persons with developmental disabilities, and children in foster care, and

10. Provide an opt-out option to allow recipients to purchase employer-sponsored coverage, but allows a recipient to re-enroll in Medicaid within a certain timeframe if the option was not the best choice for the individual.

The Bill requires AHCA to post all waiver applications to implement this program on its Internet website 30 days prior to submission to the federal government. All waiver applications must be provided to the House and Senate 10 days before submission to the federal government and all waivers approved by the federal government may not be implemented without review and approval of the Legislature as a whole.

The Bill requires OPPAGA and the Auditor General to conduct an evaluation of the pilot to be provided to the Governor and the Legislature no later than June 30, 2008, to consider statewide expansion.

Requires that Medicaid lung transplants be reimbursed using a global payment methodology and appropriates funds for these services.

Requires that at least five percent of Medicaid audits to detect Medicaid funds lost to fraud and abuse be conducted on a random basis.

Requires Medicaid recipients to be provided explanations of benefits.

Requires AHCA to study the legal and program barriers to enforcing co-payments in the Medicaid program.

Requires AHCA to develop recommendations to improve third-party liability recoveries and ensure that Medicaid is the payor of last resort.

Requires OPPAGA to study and confirm the value of nursing home diversion programs.

Requires AHCA to study mechanisms for collecting patient-responsibility payments from persons in the diversion programs.

Requires OPPAGA to conduct a study of Medicaid buy-in programs, and whether the Medically Needy program can be redesigned to be a Medicaid buy-in program.

Requires OPPAGA, in consultation with the Attorney General's Medicaid Fraud Control Unit and the Auditor General, to study potential fraud and abuse by pharmaceutical manufacturers in their pricing and rebate practices in Medicaid. Requires the report to be submitted to the Legislature and Governor by January 1, 2006.

The Bill repeals provisions of SB 404, the Health Appropriations Conforming Bill, that changes the agency's rule-making authority related to rate setting in ch. 120, F.S., removes rates from provider contracts, allows the agency to adjust Medicaid rates in provider contracts with only a 48-hour notice, and removes a provider's right to an administrative hearing under ch. 120, F.S. Instead, the Bill requires the Senate Select Committee on Medicaid Reform to study how provider rates are established and modified. The Bill also provides Medicaid HMOs a 2.8 percent rate increase.

The sums of $7,129,241 in recurring General Revenue Funds, $9,076,575 in nonrecurring General Revenue Funds, $8,608,242 in recurring funds from the Administrative Trust Fund, and $9,076,874 in nonrecurring funds from the Administrative Trust Fund are appropriated and 11 full-time equivalent positions are authorized for the purpose of implementing this act. These provisions were effective July 1, 2005.

Constitutional Amendments

In November 2004, Florida voters passed several healthcare constitutional amendments. The Legislature was delegated to pass legislation implementing the modifications. Below are the bills implementing the changes:

Adverse Medical Incidents (Committee Substitute Senate Bill 938)

This Bill is referred to as the "Patients' Right-to-Know Act." The Act requires hospitals, ambulatory surgical centers, mobile surgical facilities, medical physicians, osteopathic physicians, and podiatric physicians to provide access to records of adverse medical incidents that occurred on or after November 2, 2004. An adverse medical incident means medical negligence, intentional misconduct, or any other act, neglect, or default of a health care facility or health care provider, which caused, or could have caused injury or death to a patient. A patient may have access to a final adverse medical incident report of the facility or provider of which he or she is a patient, which involves the same or substantially similar condition, treatment, or diagnosis as that of the patient requesting access. A patient must request adverse medical incident records in writing and must provide his or her name, address, the last four digits of his or her social security number, a description of his or her condition, treatment, or diagnosis, and the name/s of the health care providers whose records are being sought.

The Act prohibits the disclosure of the identity of patients involved in an adverse medical incident report. The records of adverse medical incidents obtained by a patient under this Act are not discoverable or admissible into evidence in any civil or administrative action against a health care facility or provider, unless otherwise provided by an act of the Legislature.

Repeated Medical Malpractice (Committee Substitute Senate Bill 940)

This legislation implements s. 26, Art. X of the State Constitution, which provides that "no person who has been found to have committed three or more incidents of medical malpractice shall be licensed or continue to be licensed by the State of Florida to provide health care services as a medical doctor." The Bill applies the constitutional provision to allopathic and osteopathic physicians. Only incidents that occurred on or after November 2, 2004, may be considered for purposes of the prohibition on licensure for repeated medical malpractice. The Board of Medicine and the Board of Osteopathic Medicine, when revoking a license or granting or denying a license, must review the facts supporting an incident of medical malpractice using a clear and convincing standard of evidence. The time for the Boards to review physician licensure applications is extended from 90 to 180 days. Acts of medical malpractice, gross medical malpractice, or repeated malpractice, as grounds for which an allopathic or osteopathic physician may be disciplined, are redefined to implement s. 26, Art. X of the State Constitution. Incident is defined to include a single act of medical malpractice, regardless of the number of claimants. Multiple findings of medical malpractice arising from the same act or acts associated with the treatment of the same patient must count as only one incident. Beginning July 1, 2005, the Department of Health must verify each physician's disciplinary history and medical malpractice claims at initial licensure and licensure renewal using the National Practitioner Data Bank. The physician profiles must reflect the disciplinary action and medical malpractice claims as reported by the National Practitioner Data Bank.

Parental Notice of Abortion Act (House Bill 1659)

The Parental Notice of Abortion Act authorizes the Legislature to require by general law for notification to a parent or guardian of a minor before the termination of the minor's pregnancy. The Bill requires a physician to give actual notice in person or by telephone 48 hours before the termination of a minor's pregnancy. If actual notice is not possible after a reasonable effort has been mode, the physician performing the termination of pregnancy or the referring physician must give constructive notice in writing, signed by the physician, and mailed at least 72 hours before the termination of the minor's pregnancy to the last known address of the parent or legal guardian. Constructive notice must be sent by certified mail, return receipt requested, with delivery restricted to the parent or legal guardian. After the 72 hours have passed, delivery of the constructive notice is deemed to have occurred. Violation of the notification requirement constitutes grounds for disciplinary action against the physician under the Physician's Practice Act.

Notice is not required if a medical emergency exists and there is insufficient time for the physician to comply with the notice requirements; the person entitled to notice waives in writing his or her right to notice; the minor is or has been married or is emancipated; the minor waives notice because she has a minor child dependent on her; or notice is waived by the judicial waiver procedure that is established in the Bill.

A minor may petition any circuit court in a judicial circuit within the jurisdiction of the District Court of Appeal in which she resides for a waiver of the notice requirement, and she may file the petition under a pseudonym or through the use of initials, as provided by court rule. The court must advise the minor that she has a right to court appointed counsel and must provide her with counsel upon her request at no cost to the minor. The court must rule within 48 hours unless the 48-hour limitation has been extended at the request of the minor. If the court does not rule within 48 hours and the limit has not been extended, the petition is granted and the notice requirement is waived. If the court finds by clear and convincing evidence that the minor is sufficiently mature to decide whether to terminate her pregnancy, the court must issue an order authorizing the minor to consent to the termination of pregnancy without notification of a parent.

If the court finds by a preponderance of the evidence that there is evidence of child abuse or sexual abuse of the petitioner by a parent or guardian, or that the notification of a parent or guardian is not in the best interest of the minor, the court must issue an order authorizing the minor to consent to the termination of pregnancy without notification of a parent or guardian. If the court does not find one of the following - that the minor is sufficiently mature to decide, that there is evidence of child abuse or sexual abuse of the minor by a parent or guardian, or that notification of a parent or guardian is not in the best interest of the petitioner-the court must dismiss the petition.

The Bill requests the Supreme Court to adapt rules and forms for petitions, including provisions addressing confidentiality; and requires the Supreme Court to report annually to the Governor and the Legislature on the number of petitions filed, and the timing and manner of disposal of the petitions.

Other Health Care Bills of Interest

Department of Health (Committee Substitute Senate Bill 410)

Requires that information from the National Practitioner Data Base be included in the physician profiles;

Clarifies the requirements pertaining to certifying national examinations and requests to challenge the exams. Candidates with a score of not less that 10 percent below the minimum score required to pass the examination shall be entitled to challenge the examination in a hearing.

Creates a retired license status and authorizes a retired license fee not to exceed $50. Allows the board or department to impose conditions on a licensed practitioner who has held a retired license for more than five years or from another state who has not practiced for five years or more.

Defines the scope of practice for certified nursing assistants (CNAs).

Provides rulemaking authority to the Board of Nursing to specify the scope of practice, and level of supervision required for CNAs.

Practice of Medicine (Committee Substitute Senate Bill 1180)

Increases number of consumer members of the Board of Medicine from three to five. Consumer members must be Florida residents who have lived in Florida for at least five years immediately preceding their appointment, never been licensed as a healthcare practitioner under Chapter 456, F.S. and do not have a substantial personal, business, or professional connection with a licensed care practitioner, medical education or health care facility, except as patients or potential patients;

Requires physician members on the Board of Medicine to be Florida licensed in good standing, Florida residents, and to have engaged in the active practice or teaching of medicine in Florida with a full and unrestricted medical license for at least five years immediately preceding their appointment;

Allows a medical physician licensure applicant to enroll in a two-year externship in a licensed non-statutory teaching hospital in lieu of completing the required four-year residency for licensure and the academic year of supervised clinical training for foreign medical graduates.