2013 Maryland Code
HEALTH - GENERAL
§ 19-713 - Rates and contracts

§19-713.

(a) (1) Each health maintenance organization shall file with the Commissioner and pay the applicable filing fee as provided in § 2-112 of the Insurance Article, before they become effective:

(i) All rates that the health maintenance organization charges subscribers or groups of subscribers; and

(ii) The form and content of each contract between the health maintenance organization and its subscribers or groups of subscribers.

(2) (i) A health maintenance organization that offers a health benefit plan, as defined in § 11-601 of the Insurance Article, is subject to Title 11, Subtitle 6 of the Insurance Article for the health benefit plan.

(ii) If the provisions of Title 11, Subtitle 6 of the Insurance Article conflict with the provisions of this section, the provisions of Title 11, Subtitle 6 of the Insurance Article shall prevail.

(b) (1) Rates of a health maintenance organization may not be excessive, inadequate, or unfairly discriminatory in relation to the services offered.

(2) A health maintenance organization that includes a subrogation provision in its contract as authorized under § 19-713.1(d) of this subtitle shall:

(i) Use in its rating methodology an adjustment that reflects the subrogation; and

(ii) Identify in its rate filing with the Maryland Insurance Administration, and annually in a form approved by the Insurance Commissioner, all amounts recovered through subrogation.

(c) (1) If, at any time, a health maintenance organization wishes to amend any contract with its subscribers or change any rate charged, the health maintenance organization shall file with the Commissioner the number of copies of the amendment or rate change that the Commissioner requires.

(2) The Commissioner shall provide the Department with the number of copies it requires.

(d) The Commissioner shall coordinate the contract and related rate filing review under this section.

(e) (1) If within 60 days after a filing made pursuant to this section, the Commissioner finds the filing does not meet the requirements of subsection (f) of this section, the filer shall be sent notice of disapproval specifying in what respects the Commissioner finds that the filing fails to meet the requirements of this section and stating that the filing shall not become effective.

(2) The Commissioner may not issue a notice of disapproval of a filing under subsection (f) of this section without a statutory or regulatory basis for the disapproval and an explanation of the application of the statutory or regulatory basis which resulted in the disapproval.

(f) The Commissioner shall disapprove any form filed, or withdraw any previous approval, if the form:

(1) Is in any respect in violation or does not comply with this article or applicable regulations;

(2) Contains, or incorporates by reference, any inconsistent or inapplicable clauses, exceptions, or conditions which affect the risk purported to be assumed in the general coverage of the contract;

(3) Has any title, heading, or other indication of its provisions which is likely to mislead the subscriber or member;

(4) Includes provisions that are inequitable, or provisions that lack any substantial benefit to the subscriber or member;

(5) Is printed or otherwise reproduced in a manner as to render any provision of the form substantially illegible; or

(6) Provides benefits that are unreasonable in relation to the premium charged.

(g) (1) Except as provided in paragraph (2) of this subsection, unless the Commissioner disapproves a filing under this section, the filing becomes effective 60 days after the office of the Commissioner receives the filing or on any other date that the Commissioner sets.

(2) The Commissioner may adopt regulations to allow a type or kind of form to be effective upon receipt of the filing by the Commissioner.

(3) If a health maintenance organization uses a form which becomes effective in accordance with the provisions of paragraph (2) of this subsection and the form would be subject to disapproval under subsection (f) of this section, the Commissioner may:

(i) Subsequently disapprove the form; and

(ii) Find the health maintenance organization to be in violation of § 19-729 of this subtitle and impose a penalty as provided in § 19-730 of this subtitle.

(4) If a health maintenance organization files a form with the Commissioner which becomes effective in accordance with the provisions of paragraph (2) of this subsection, the health maintenance organization shall pay the applicable filing fee provided in § 2-112 of the Insurance Article.

§ 19-713 - 1. Contracts between health maintenance organization and subscribers

(a) Nonduplication or coordination of coverage provisions -- In general. -- A contract between a health maintenance organization and its subscribers or a group of subscribers may contain nonduplication provisions or provisions to coordinate the coverage with subscriber contracts of other health maintenance organizations, health insurance policies, including those of nonprofit health service plans, and with other established programs under which the subscriber or member may make a claim.

(b) Nonduplication or coordination of coverage provisions -- Specified disease policies; intensive care policies. -- Notwithstanding the provisions of subsection (a) of this section, a contract between a health maintenance organization and its subscribers or a group of subscribers may not contain nonduplication provisions or provisions to coordinate coverage with any individually underwritten and issued, guaranteed renewable, specified disease policy, as defined in § 15-109 of the Insurance Article, or intensive care policy, which does not provide benefits on an expense incurred basis.

(c) "Intensive care policy" defined. -- For purposes of this section, "intensive care policy" means a health insurance policy that provides benefits only when treatment is received in that specifically designated facility of a hospital that provides the highest level of care and which is restricted to those patients who are physically, critically ill or injured.

(d) Subrogation provisions -- Authorized. -- Notwithstanding § 19-701 (g) (3) of this subtitle, a contract between a health maintenance organization and its subscribers or a group of subscribers may contain a provision allowing the health maintenance organization to be subrogated to a cause of action that a subscriber has against another person:

(1) To the extent that any actual payments made by the health maintenance organization result from the occurrence that gave rise to the cause of action; or

(2) For a nonprofit health maintenance organization that exclusively contracts with a group of physicians to provide or to arrange for the provision of health care services for its enrollees, for any service provided by the health maintenance organization as a result of the occurrence that gave rise to the cause of action, per the fee schedule established by the nonprofit health maintenance organization.

(e) Subrogation provisions -- Recovery under personal injury protection policy. --

(1) Subsection (d) of this section does not allow a contract between a health maintenance organization and its subscribers or a group of subscribers to contain a provision allowing the health maintenance organization to recover any payments made to a subscriber under the personal injury protection coverage of a motor vehicle liability insurance policy.

(2) A contract between a health maintenance organization and its subscribers or a group of subscribers may not contain a provision that requires personal injury protection benefits under a motor vehicle liability insurance policy to be paid before benefits under the contract.

(f) Subrogation provisions -- Recovery of medical expenses. -- Subsection (d) of this section does not allow a health maintenance organization to recover medical expenses from a subscriber under a subrogation provision unless the subscriber recovers for medical expenses in a cause of action.

§ 19-713 - 2. Administrative service provider contracts

(a) Definitions. --

(1) In this section the following words have the meanings indicated.

(2) "Administrative service provider contract" means a contract or capitation agreement between a health maintenance organization and a contracting provider which includes requirements that:

(i) The contracting provider accept payments from a health maintenance organization for health care services to be provided to members of the health maintenance organization that the contracting provider arranges to be provided by external providers; and

(ii) The contracting provider administer payments pursuant to the contract with the health maintenance organization for the health care services to the external providers.

(3) (i) "Contracting provider" means a person who enters into an administrative service provider contract with a health maintenance organization.

(ii) "Contracting provider" does not include a medical laboratory as defined in § 17-201 of this article.

(4) "External provider" means a health care provider, including a physician or hospital, who is not:

(i) A contracting provider; or

(ii) An employee, shareholder, or partner of a contracting provider.

(b) Applicability of section. -- This section does not apply to a contract between a health maintenance organization and a contracting provider that is affiliated with the health maintenance organization through common ownership within an insurance holding company system, if the health maintenance organization:

(1) Files with the Commissioner consolidated financial statements that include the contracting provider; and

(2) Records a reserve for the liabilities of the contracting provider in accordance with § 5-201 of the Insurance Article.

(c) Plan required. -- A health maintenance organization may not enter into an administrative service provider contract unless:

(1) The health maintenance organization files with the Insurance Commissioner a plan that satisfies the requirements of subsection (d) of this section; and

(2) The Insurance Commissioner does not disapprove the filing within 30 days after the plan is filed.

(d) Plan requirements. -- The plan required under subsection (c) of this section shall:

(1) Require the contracting provider to provide the health maintenance organization with monthly reports, within 30 days of the end of the month reported, that identify payments made or owed to external providers in sufficient detail to determine if the payments are being made in compliance with law;

(2) Require the contracting provider to provide to the health maintenance organization a current annual financial statement of the contracting provider each year, within 90 days of the end of the year reported;

(3) Require the health maintenance organization to establish and maintain a segregated fund, in a form and an amount approved by the Commissioner, which may include withheld funds, escrow accounts, letters of credit, or similar arrangements, or require the availability of other resources that are sufficient to satisfy the contracting provider's obligations to external providers for services rendered to members of the health maintenance organization;

(4) Require the contracting provider to submit to the health maintenance organization information demonstrating that the fund established under item (3) of this subsection is sufficient to satisfy the contracting provider's obligations to external providers for services rendered to members of the health maintenance organization; and

(5) Require the health maintenance organization, at least quarterly, to review and inspect the contracting provider's books, records, and operations relevant to the provider's contract for the purpose of determining the contracting provider's compliance with the plan.

(e) Sufficiency of segregated fund. -- In determining the sufficiency of a segregated fund, the Commissioner may consider whether external providers are owned or controlled by the contracting provider.

(f) Requirements of segregated fund. -- The segregated fund or other resources established as a result of an administrative service provider contract:

(1) Shall be held in trust for payment to external providers; and

(2) May not be considered an asset or an account of the contracting provider for the purpose of determining the assets or accounts of a bankrupt contracting provider.

(g) Compliance with plan. -- The health maintenance organization and the contracting provider shall comply with the plan.

(h) Monitoring. --

(1) The health maintenance organization shall monitor the contracting provider to assure compliance with the plan, and the health maintenance organization shall notify the contracting provider whenever a failure to comply with the plan occurs.

(2) Upon the failure of the contracting provider to comply with the plan following notice of noncompliance, or upon termination of the administrative service provider contract for any reason, the health maintenance organization shall notify the Commissioner and shall assume the administration of any payments due from the contracting provider to external providers on behalf of the contracting provider, as required under § 19-712 of this subtitle.

(i) Results. -- The health maintenance organization shall file with the Commissioner, the results of each quarterly review required under subsection (d) (5) of this section.

(j) Confidentiality. -- The plan and all supporting documentation submitted in connection with the plan shall be treated as confidential and proprietary, and may not be disclosed except as otherwise required by law.

(k) Compliance with administrative service provider contract. -- A health maintenance organization and a contracting provider shall comply with the terms of an administrative service provider contract as required under this section and § 19-712 of this subtitle.

(l) Penalties. -- If a contracting provider fails to comply with the plan or the administrative service provider contract, as required under subsections (g) and (k) of this section, the Commissioner may impose a fine not exceeding $ 125,000 or suspend or revoke the registration of the contracting provider under § 19-713.3 of this subtitle, or both.

§ 19-713 - 3. Administrative service contracting provider

(a) Definitions. --

(1) In this section the following words have the meanings indicated.

(2) "Administrative service provider contract" has the meaning stated in § 19-713.2 of this subtitle.

(3) "Contracting provider" has the meaning stated in § 19-713.2 of this subtitle.

(b) Registration. --

(1) A person must register with the Commissioner before the person acts as a contracting provider in this State.

(2) A health maintenance organization may not enter into an administrative service provider contract with a contracting provider that has not registered with the Commissioner.

(c) Application. --

(1) An applicant for registration shall submit an application to the Commissioner in a form approved by the Commissioner and include any information required under subsection (e) of this section.

(2) A registration under this section expires 2 years from the date the application is approved.

(d) Registration fee. -- The Commissioner may charge a registration fee sufficient to cover the cost of implementing this section.

(e) Regulations. -- The Commissioner may adopt regulations to carry out the provisions of this section and § 19-713.2 of this subtitle.

§ 19-713 - 4. Providing pharmaceutical services

(a) Agent included. -- In this section, "health maintenance organization" or "HMO" includes any agent of a health maintenance organization.

(b) Request for proposal to provide services. --

(1) A health maintenance organization that issues a request for proposal, including changes in terms to an existing contract to provide pharmaceutical services, shall notify the Maryland Pharmacists Association of the request for proposal to provide pharmaceutical services within 10 days after issuing that request.

(2) The Maryland Pharmacists Association may inform licensed pharmacists of the request.

(c) Application fee prohibited. -- A health maintenance organization may not charge a fee for processing or accepting an application to provide pharmaceutical services.

(d) Applicability. -- This section does not apply to a health maintenance organization if the health maintenance organization provides pharmaceutical services from a pharmacy that is:

(1) Located on the site of the health maintenance organization; and

(2) Wholly owned and operated by the health maintenance organization.

§ 19-713 - 5. Uniform consultation referral form

(a) Exclusive use. -- If a health maintenance organization requires its subscribers to have a referral to receive consultation services in writing, the health maintenance organization shall use the uniform consultation referral form adopted by the Commissioner under § 15-120 of the Insurance Article as the sole instrument for referrals for consultation services.

(b) Modifications. -- A health maintenance organization may not impose as a condition of coverage any requirement to:

(1) Modify the uniform consultation referral form; or

(2) Submit additional consultation referral forms.

(c) Proper completion. -- The uniform consultation referral form shall be properly completed by the health care provider referring the subscriber for consultation services.

§ 19-713 - 6. Drug therapy management

(a) Definitions. --

(1) In this section the following words have the meanings indicated.

(2) "Documented informed consent" means:

(i) A written consent form signed by a patient; or

(ii) Verbal or otherwise communicated consent signified by a notation in a patient's electronic medical record maintained by a group model health maintenance organization.

(3) "Drug therapy management" means treatment of a patient using drug therapy, laboratory tests, or medical devices under conditions or limitations set forth in a protocol specified in a physician-pharmacist agreement for the purpose of improving patient outcome.

(4) "Group model health maintenance organization" means a health maintenance organization that:

(i) Contracts with one multispecialty group of physicians who are employed by and shareholders of the multispecialty group; and

(ii) Provides and arranges for the provision of physician services to patients at medical facilities operated by the health maintenance organization.

(5) "Licensed pharmacist" means an individual who is licensed to practice pharmacy under Title 12 of the Health Occupations Article.

(6) "Licensed physician" means an individual who is licensed to practice medicine under Title 14 of the Health Occupations Article.

(7) "Patient" means:

(i) A patient who is a member of a group model health maintenance organization; or

(ii) An individual to whom the group model health maintenance organization is contractually or legally obligated to provide, or arrange to provide, health care services.

(8) "Physician-pharmacist agreement" means an approved agreement between a licensed physician and a licensed pharmacist that is disease-state specific and specifies the protocols that may be used.

(9) "Protocol" means a course of treatment predetermined by the licensed physician and licensed pharmacist according to generally accepted medical practice for the proper completion of a particular therapeutic or diagnostic intervention.

(b) Physician-pharmacist agreement. --

(1) In a group model health maintenance organization, a licensed physician and a licensed pharmacist who wish to provide drug therapy management to patients shall have a physician-pharmacist agreement that is approved by the State Board of Pharmacy and the State Board of Physicians.

(2) Drug therapy management shall be provided under this section only:

(i) In accordance with a physician-pharmacist agreement; and

(ii) Through the internal pharmacy operations of the group model health maintenance organization.

(c) Physician-pharmacist agreement -- Licensed pharmacist. -- A licensed pharmacist is authorized to enter into a physician-pharmacist agreement if the licensed pharmacist:

(1) Has a Doctor of Pharmacy Degree or equivalent training as established in regulations adopted by the State Board of Pharmacy;

(2) Is approved by the State Board of Pharmacy to enter into a physician-pharmacist agreement with a licensed physician; and

(3) Meets any other requirements established by regulation by the State Board of Pharmacy.

(d) Physician-pharmacist agreement -- Substitution of chemically dissimilar drug prohibited. -- A physician-pharmacist agreement shall prohibit the substitution of a chemically dissimilar drug product by the pharmacist for the product prescribed by the physician, unless permitted in the protocol specified in the physician-pharmacist agreement.

(e) Physician-pharmacist agreement --Disapproval. -- The Board of Physicians and the Board of Pharmacy may not approve a physician-pharmacist agreement if the boards find that there is:

(1) Inadequate training, experience, or education of the physicians or pharmacists to implement the protocol or protocols specified in the physician-pharmacist agreement; or

(2) A failure to satisfy the requirements of:

(i) This section or Title 14 of the Health Occupations Article; or

(ii) Any regulations adopted by the Board of Physicians and the Board of Pharmacy under this section.

(f) Physician-pharmacist agreement -- Term. -- A physician-pharmacist agreement under this section shall be valid for 2 years from the date of its final approval by the Board of Physicians and the Board of Pharmacy and may be renewed for additional 2-year terms with approval from the Board of Physicians and the Board of Pharmacy.

(g) Withdrawal of participation. -- A patient may decline to participate or withdraw from participating in drug therapy management in a group model health maintenance organization at any time.

(h) Notice to patient. -- A licensed physician or licensed pharmacist or both shall inform a patient:

(1) Regarding the procedures that will be utilized for drug therapy management under the associated protocols;

(2) That the patient may decline to participate or withdraw from participating in the drug therapy management at any time; and

(3) That neither the physician nor the pharmacist has been coerced, given economic incentives, excluding normal reimbursement for services rendered, or involuntarily required to participate.

(i) Informed consent. -- A licensed physician or a licensed pharmacist or both shall obtain documented informed consent from a patient after disclosing the information required to be disclosed under subsection (h) of this section.