Big wins in patient safety and prior authorization and big changes in out-of-network billing

by Susan Koontz, JD, General Counsel, Senior Director of Government Relations

The Colorado General Assembly adjourned on May 3, concluding a legislative session that arguably had the most sweeping and contentious focus on health care law and policy in recent memory. The multiple fronts of professional review and Medical Practice Act (MPA) sunset, the opioid crisis, out-of-network (surprise medical bills) reform, prior authorization and funding challenges within state budget deliberations were all anticipated and strategized by the Colorado Medical Society before the session convened. As expected, these multiple fronts completely absorbed the advocacy bandwidth of CMS and an impressive array of physician allies, often forcing near-impossible choices as pressure converged from both parties and various outside interests. Success in this formidable political environment can be objectively measured not just by fair laws passed but also in terms of so-called “opportunity costs” – bad policies that were unrealized by adversaries despite a wealth of policy targets.

“Colorado may have replaced states like California or Oregon as a health policy hotspot,” said CMS President Deb Parsons, MD, FACP. “Never have we been engaged across so many fronts by so many divergent interests on such a range of diverse issues. I am proud of the excellent work of our lobbyists, staff and fellow physicians who worked within our culture of collaboration and allowed us to make real gains in what could have been a catastrophic session.”

Others involved in public policy agree, noting that CMS’s political and legislative success this session was accomplished through methodical, sustained engagement of local physicians and their advocates before legislators convened in Denver and throughout the session.

“The four months legislators are in the pressure cooker under the dome are preceded by eight months of briefings and conversations with elected officials, allies, and prospective adversaries that delineate medicine’s concerns and priorities,” said CMS President-elect David Markenson, MD. “In some cases, legislators have never considered the complexities of health care policy and it is our task to present it clearly long before they are in a committee hearing or considering floor amendments. This is our long game.”

Legislators maintain Colorado’s patient safety culture, reject lawsuits as the answer

Colorado’s stable liability climate stayed intact, while plaintiff attorneys focused their attention instead on making professional review records discoverable. Plaintiff attorneys engaged in a session-long campaign to breach the privileged nature of professional review activities, and at times threatened to persuade legislators to allow this vital body of patient safety law to lapse under the state’s sunset review process. This most serious threat of the session was not successful.

CMS, COPIC, the Colorado Hospital Association, and specialty and component medical societies joined forces in a strategic coalition that was well coordinated and executed throughout the session, and strengthened by the many physicians who responded to CMS’ Code Blue legislative alerts.

In Florida – the only state in the country to permit discovery of these records – physician confidence in professional review has virtually collapsed since a state Supreme Court ruling in October 2017. CMS President Deb Parsons, MD, FACP, met with Senate President Leroy Garcia (D-Pueblo) late in the session to reinforce the message that lawyers cannot sue Colorado into a safe patient environment. She emphasized the result of a CMS-commissioned survey of Florida Medical Association (FMA) members demonstrating a virtual abandonment and loss of confidence in the peer review system where medical errors are now going unidentified and uncorrected, presumably waiting for a lawsuit to punish a compensable event.

In the last days of the legislative session, House Majority Leader Alec Garnett (D-Denver) played a key role in the bill’s passage by mediating discussions involving CMS, COPIC, CHA and Colorado Trial Lawyers Association (CTLA). The basis for medicine’s strong resolve throughout the session resided in CMS and FMA survey results (see page 14). Fully 79 percent of CMS members surveyed said that it was “extremely important” that protection for documents from professional review be kept in place.

The day before adjournment, the 2019 General Assembly passed SB19-234, reenacting the body of law governing professional review. Significantly, the renewed Professional Review Act maintains the professional review privilege for all documents and information privileged under the current law for the next 11 years.

“I was proud to have a small part in helping get this critical, life-saving piece of legislation through the General Assembly,” Garnett said. “Peer review is a time-honored practice that helps better patient outcomes and, thanks to this bill, will be preserved long into Colorado’s future.”

Another top priority was reenacting the Medical Practice Act, which reauthorizes the Colorado Medical Board and its vital functions of licensure, investigation of complaints, taking disciplinary actions and imposing fines, and aiding law enforcement in the enforcement and prosecution of any person or entity charged with the violation of any of the MPA provisions.

The bill to continue the MPA, SB19-193, implements some of the recommendations in the 2018 sunset report by the Department of Regulatory Agencies. It will continue the MPA and Colorado Medical Board until 2026; eliminate the restriction on the number of days that a physician may practice in a calendar year with a pro bono license; repeal the requirement that the board send a letter of admonition to a licensee by certified mail; and make other technical amendments.

Legislators respond to prior authorization “hassle factors”

Driven by CMS member survey data demonstrating that getting approval for prior authorization (PA) requests has gotten harder since 2014, CMS took the lead in the fight for HB19-1211, “Prior Authorization Requirements Health Care Service.” It will streamline the overall PA process by reducing the time for response to a non-urgent request from 15 days to five days; ensuring that services that have been approved cannot be retrospectively denied; and ensuring that an approved prior authorization request remains valid for at least 180 days and continues for the duration of the prescribed course of treatment, among other provisions.

“We had doctors who wanted to shorten the prior authorization experience and streamline clinical guidelines. We had insurance companies who were worried about significant enough time to follow their own internal guidelines for medical review,” said bill sponsor Rep. Dafna Michaelson Jenet (D-Commerce City), in an email to her constituents. “How do we get to an agreement? The answer: a lot of patience and a lot of negotiation. Perhaps some elevated blood pressures and a hearty handshake at the end. I am very grateful for all of the people who agreed to come to the table and work on this with me, and for representative and doctor Yadira Caraveo to make this a possibility and improve the health care costs and experiences for patients in Colorado.”

The Colorado Academy of Family Physicians took the lead for organized medicine on the Candor Act (SB19-201), which will provide legal protections for confidential communications between a health care provider or facility and a patient after an unanticipated health care outcome. CMS and COPIC supported CAFP’s advocacy efforts. The final act promotes open discussions after an adverse health care outcome so patients and their loved ones understand what happened and what steps may be taken to prevent similar outcomes, if possible. Under certain circumstances, optimal resolution may include an offer of compensation.

“The Candor Act provides a framework for physicians to offer compassionate, honest, timely and thorough responses to unexpected health care outcomes,” said CAFP President-elect and CMS member John Cawley, MD, FAAFP, of Fort Collins. “CAFP championed SB19-201 to provide a better system both for patients and physicians. It is confidential and entirely voluntary, but it is an option that can lead to a resolution far faster than the current tort system, allowing patients to learn about what happened and what might be done to prevent a similar outcome in the future.”

Opioid interim study committee produces 2019 CMS-supported reforms

For the past six years, CMS has been working with partners in the Colorado Coalition for Prescription Drug Abuse Prevention to develop policies, enact laws and make important strides to reverse the opioid epidemic. All the bills from the Opioid and Other Substance Use Disorders Interim Study Committee were introduced and worked their way through the legislature, as did other opioid-related bills introduced earlier this year.

HB19-1287, “Treatment for Opioids and Substance Use Disorders,” directs the Department of Human Services to implement a centralized, web-based behavioral health tracking system to track available treatment capacity at behavioral health and treatment centers to support treatment access. It also directs the Department of Human Services to implement a care navigation system and expands treatment capacity in rural and underserved areas.

HB19-1009, “Substance Use Disorders Recovery,” focuses on expanding housing vouchers for individuals recovering from a substance use disorder and the licensing of recovery residences. It also creates an opioid crisis recovery fund for money the state receives as settlement from opioid litigation.

SB19-227, “Harm Reduction Substance Use Disorders,” carries a variety of harm reduction measures; including allowing school districts to carry naloxone; specifying that hospitals can be a syringe access site; creating a naloxone bulk purchase fund; expanding the medication take-back system to include sharps;authorizing naloxone to be available where an automated external defibrillator (AED) is available; and establishing criteria for how a program must verify the identity of individuals seeking treatment, including those without identification and those experiencing homelessness.

SB19-228, “Substance Use Disorders Prevention Measures,” has a variety of components related to prevention. Most significantly for physicians is a requirement of health care providers who prescribe opioids to complete substance use disorder training as part of continuing education required to renew their license. CMS opposed a mandatory CME provision but ultimately did not oppose the bill given other pressing legislation.

“We view this session as a win because we were able to get additional funding to address the opioid epidemic and achieve much of the agenda of the interim committee,” said Robert Valuck, PhD, RPh, executive director of the Colorado Consortium for Prescription Drug Abuse Prevention. “Regarding mandatory CME, there was a very strong appetite at the legislature this session. Legislators felt that while there has been a lot of success with voluntary CME, there are more prescribers we can reach with this requirement. We at the consortium worked with bill sponsors to make the mandate as rational and reasonable as possible.”

Out-of-network and reinsurance deliberations chart new courses

The legislative scrutiny regarding surprise medical bills aligned a trifecta of payers, consumers, and purchasers/employers – a perfect political storm for physicians. Much like the contentious debates in multiple other states, local and national media pressure was unrelenting, producing storylines that profiled billing excesses by outliers rather than the more complex picture of how plans game networks. Throughout the session, CMS and specialty medical society allies pressed the case for fair-minded reforms.

In the end, HB19-1174 passed into law. CMS and specialty societies were successful in narrowing the scope to emergency situations and inadvertent treatment by an out-of-network provider at an in-network facility. The bill also added “baseball arbitration,” where the carrier and provider both submit, in writing, their final offer and an arbitrator considers the provider’s level of training, education, experience and specialization as well as the previously contracted rate if the provider had a contract with the carrier that was terminated or expired within one year of the dispute.

Despite citing multiple data sources, the final bill does not establish medicine’s preferred payment benchmark. For covered services at an in-network facility from an out-of-network provider or for out-of-network emergency services with some exceptions, the carrier will pay the provider directly the greater of 110 percent of the carrier’s in-network reimbursement rate for the same service in the same geographic area or the 60th percentile of the in-network reimbursement rate for the same service in the same geographic area for the prior year based on commercial claims data from the all-payer claims database (APCD).

If the out-of-network provider provides covered emergency services or nonemergency services and the provider receives payment from the covered person for which he or she is not responsible (i.e., the health plan has made a payment pursuant to this statute), the provider must reimburse the covered person within 60 days of receiving notification of the overpayment. If the provider fails to reimburse the covered person within the 60-day timeframe, the provider must pay interest on the overpayment at the rate of 10 percent per annum beginning on the date the provider was notified.

The Division of Insurance will work with the medical board and the Department of Health to develop rules outlining the language and timing of notifications to be used by all parties when informing a covered person about the possibility of receiving care from an out-of-network provider. Insurance Commissioner Michael Conway reached out to CMS on the day of the bill’s passage with an invitation to work on the law’s implementation and to discuss potential reporting requirements to track concerns raised in testimony by physicians.

A top priority of Gov. Jared Polis and Insurance Commissioner Conway, HB19-1168, the State Innovation Waiver Reinsurance Program, creates a reinsurance program for Coloradans in the individual health insurance market. The program will provide reinsurance payments to health insurers to aid in paying high-cost insurance claims once an individual’s claims for the year reach a certain level (known as the “attachment point”) up to a cap determined by the commissioner.

As originally filed, the program’s funding mechanism used Medicare reference-based pricing for physicians and hospitals. A physician-specialty forum convened by CMS leaders met with the commissioner in March to discuss the bill and express concerns. Amendments accepted in April and adopted in the final bill changed the funding mechanism so it no longer relies on rate-setting of physicians or hospitals.

“Not only is it a win that physicians were completely removed from the bill, but it is a win that this bill will not set any precedent for the DOI engaging in provider rate setting,” said Amy Berenbaum Goodman, JD, MBE, CMS senior director of policy.

A portion of the funding for the reinsurance program will come from what is known as pass-through funding from the federal government, pending approval, and through “special fees” assessed against hospitals, not exceeding $40 million, as well as several other funding sources.

Immunization legislation stalls on anticipated veto

CMS supported HB 19-1312, “Modernizing Immunization Requirements for School Entry to Improve Vaccination Rates,” which aimed to increase childhood vaccination rates in Colorado by making it more difficult for parents to obtain a non-medical vaccine exemption. The original concept would have banned non-medical exemptions for any public school student. Even with compromises, Gov. Polis felt it still imposed an undue burden on families, particularly in rural areas, and announced that he would veto the bill. Time ran out for further negotiations and the bill stalled in the senate.

“The immunization bill may have been the most important bill this session for the safety and wellbeing of the public,” CMS President Parsons said. “While we are disappointed in its failure to pass, we physicians can continue to educate our patients and the public on the safety, efficacy and importance of vaccines in preventing serious diseases.”

CMS member surveys consistently show that advocacy is the No. 1 priority of Colorado physicians. It is our privilege to amplify your voice at the Capitol. Thank you to all of the physicians around the state who served on the Council on Legislation, answered CMS surveys and responded to calls to action. Your involvement is critical to our success. We need all members to stay engaged throughout the interim and into the 2020 Colorado General Assembly.


Categories: Communications, Colorado Medicine, Cover Story, Legislative Updates, Resources, Practice Evolution, Administrative Simplification, Practice Management, Legal and Ethics, Health System Reform, Initiatives, Scope of practice, Liability caps, Professional review, Prescription Drug Abuse, Advocacy, Patient Safety and Professional Accountability