26.1-47 Preferred Provider Organizations

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CHAPTER 26.1-47PREFERRED PROVIDER ORGANIZATIONS26.1-47-01. Definitions. As used in this chapter, unless the context indicates otherwise:1.&quot;Commissioner&quot; means the insurance commissioner of the state of North Dakota.2.&quot;Covered person&quot; means any person on whose behalf the health care insurer is<br>obligated to pay for or provide health care services.3.&quot;Health benefit plan&quot; means the health insurance policy or subscriber agreement<br>between the covered person or the policyholder and the health care insurer which<br>defines the services covered.4.&quot;Health care insurer&quot; includes an insurance company as defined in section<br>26.1-02-01, a health service corporation as defined in section 26.1-17-01, a health<br>maintenance organization as defined in section 26.1-18.1-01, and a fraternal benefit<br>society as defined in section 26.1-15.1-02.5.&quot;Health care provider&quot; means licensed providers of health care services in this state.6.&quot;Health care services&quot; means services rendered or products sold by a health care<br>provider within the scope of the provider's license.The term includes hospital,medical, surgical, dental, vision, chiropractic, and pharmaceutical services or<br>products.7.&quot;Preferred provider&quot; means a duly licensed health care provider or group of<br>providers who have contracted with the health care insurer, under this chapter, to<br>provide health care services to covered persons under a health benefit plan.8.&quot;Preferred provider arrangement&quot; means a contract between the health care insurer<br>and one or more health care providers which complies with all the requirements of<br>this chapter.26.1-47-02. Preferred provider arrangements. Notwithstanding any provision of law tothe contrary, any health care insurer may enter into preferred provider arrangements.1.Preferred provider arrangements must:a.Establish the amount and manner of payment to the preferred provider. The<br>amount and manner of payment may include capitation payments for preferred<br>providers.b.Include mechanisms, subject to the minimum standards imposed by chapter<br>26.1-26.4, which are designed to review and control the utilization of health<br>care services and establish a procedure for determining whether health care<br>services rendered are medically necessary.c.Include mechanisms which are designed to preserve the quality of health care.d.With regard to an arrangement in which the preferred provider is placed at risk<br>for the cost or utilization of health care services, specifically include a<br>description of the preferred provider's responsibilities with respect to the health<br>care insurer's applicable administrative policies and programs, including<br>utilizationreview,qualityassessmentandimprovementprograms,credentialing, grievance procedures, and data reporting requirements.Anyadministrative responsibilities or costs not specifically described or allocated inPage No. 1the contract establishing the arrangement as the responsibility of the preferred<br>provider are the responsibility of the health care insurer.e.Provide that in the event the health care insurer fails to pay for health care<br>services as set forth in the contract, the covered person is not liable to the<br>provider for any sums owed by the health care insurer.f.Provide that in the event of the health care insurer insolvency, services for a<br>covered person continue for the period for which premium payment has been<br>made and until the covered person's discharge from inpatient facilities.g.Provide that either party terminating the contract without cause provide the<br>other party at least sixty days' advance written notice of the termination.2.Preferred provider arrangements may not unfairly deny health benefits to persons for<br>covered medically necessary services.3.Preferred provider arrangements may not restrict a health care provider from<br>entering into preferred provider arrangements or other arrangements with other<br>health care insurers.4.A health care insurer must file all its preferred provider arrangements with the<br>commissioner within ten days of implementing the arrangements. If the preferred<br>provider arrangement does not meet the requirements of this chapter, the<br>commissioner may declare the contract void and disapprove the preferred provider<br>arrangement in accordance with the procedure for policies set out in chapter<br>26.1-30.5.A preferred provider arrangement may not offer an inducement to a preferred<br>provider to provide less than medically necessary services to a covered person.<br>This subsection does not prohibit a preferred provider arrangement from including<br>capitation payments or shared-risk arrangements authorized under subdivision a of<br>subsection 1 which are not tied to specific medical decisions with respect to a<br>patient.6.A health care insurer may not penalize a provider because the provider, in good<br>faith, reports to state or federal authorities any act or practice by the health carrier<br>that jeopardizes patient health or welfare.26.1-47-03. Health benefits plans.1.Health care insurers may issue policies or subscriber agreements which provide for<br>incentives for covered persons to use the health care services of preferred providers.<br>These policies or subscriber agreements must contain all of the following provisions:a.A provision that if a covered person receives emergency care and cannot<br>reasonably reach a preferred provider that care will be reimbursed as though<br>the covered person had been treated by a preferred provider.b.A provision that if covered services are not available through a preferred<br>provider, reimbursement for those services will be made as though the covered<br>person had been treated by a preferred provider.c.A provision which clearly discloses differentials between benefit levels for<br>health care services of preferred providers and benefit levels for health care<br>services of other providers.d.A provision that entitles the covered person, if any health care services covered<br>under the health benefit plan are not available through a preferred providerPage No. 2within fifty miles [80.47 kilometers] of the policyholder's legal residence, to the<br>provision of those covered services under the health benefit plan by a health<br>care provider not under contract with the health care insurer and located within<br>fifty miles [80.47 kilometers] of the policyholder's legal residence.For thecovered person to be eligible for benefits under this subdivision, the health care<br>provider not under contract with the health care insurer must furnish the health<br>care services at the same cost or less that would have been incurred had the<br>covered person secured the health care services through a preferred provider.2.If the policy or subscriber agreement provides differences in benefit levels payable to<br>preferred providers compared to other providers, the differences may not unfairly<br>deny payment for covered services and may be no greater than necessary to<br>provide a reasonable incentive for covered persons to use the preferred provider.26.1-47-04. Preferred provider participation requirements. Health care insurers mayplace reasonable limits on the number of classes of preferred providers which satisfy the<br>standards set forth by the health care insurer, provided that there be no discrimination against<br>any providers on the basis of religion, race, color, national origin, age, sex, or marital status, and<br>further provided that selection of preferred providers is made on the combined basis of least cost<br>and highest quality of service.26.1-47-05. General requirements. Health care insurers complying with this chapterare subject to all other applicable laws, rules, and regulations of this state.26.1-47-06.Rules.The commissioner may adopt rules necessary to enforce andadminister this chapter.26.1-47-07.Penalty.The commissioner may levy an administrative penalty not toexceed ten thousand dollars for a violation of this chapter. Any person who violates this chapter<br>is guilty of a class A misdemeanor.Page No. 3Document Outlinechapter 26.1-47 preferred provider organizations