Assembly Bill No. 470–Assemblymen Goldwater and Buckley
March 10, 1999
____________
Referred to Committee on Commerce and Labor
SUMMARY—Makes various changes concerning organizations for managed care that provide medical and health care services to injured employees who are entitled to workers’ compensation. (BDR 53-1298)
FISCAL NOTE: Effect on Local Government: No.
Effect on the State or on Industrial Insurance: Yes.
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EXPLANATION – Matter in
bolded italics is new; matter between brackets
THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:
1-1
Section 1. Chapter 616B of NRS is hereby amended by adding1-2
thereto the provisions set forth as sections 2 to 18, inclusive, of this act.1-3
Sec. 2. Any document required to be filed with the commissioner1-4
pursuant to the provisions of sections 2 to 18, inclusive, of this act, other1-5
than medical records and other information relating to a specific injured1-6
employee, must be treated as a public record.1-7
Sec. 3. Each organization for managed care shall employ or1-8
contract with a physician who is licensed to practice medicine in the State2-1
of Nevada pursuant to chapter 630 of NRS to serve as its medical2-2
director.2-3
Sec. 4. Each organization for managed care shall:2-4
1. Develop and maintain written policies and procedures setting forth2-5
the manner in which it conducts utilization review; and2-6
2. Require any person with whom it subcontracts to provide2-7
utilization review to use the same policies and procedures developed2-8
pursuant to subsection 1.2-9
Sec. 5. 1. In addition to any other report that is required to be filed2-10
with the commissioner or the state board of health, each organization for2-11
managed care shall file with the commissioner and the state board of2-12
health, on or before March 1 of each year, a report regarding its methods2-13
for reviewing the quality of medical and health care services provided to2-14
injured employees.2-15
2. Each organization for managed care shall include in its report the2-16
criteria, data, benchmarks or studies used to:2-17
(a) Assess the nature, scope, quality and accessibility of medical and2-18
health care services provided to injured employees; or2-19
(b) Determine any reduction or modification of the provision of2-20
medical and health care services to injured employees.2-21
3. Except as already required to be filed with the commissioner or2-22
the state board of health, if the organization for managed care is not2-23
owned and operated by a public entity and provides medical and health2-24
care services for more than 100 injured employees, the report filed2-25
pursuant to subsection 1 must include:2-26
(a) A copy of all of its quarterly and annual financial reports;2-27
(b) A statement of any financial interest it has in any other business2-28
which is related to medical or health care that is greater than 5 percent of2-29
that business or $5,000, whichever is less; and2-30
(c) A description of each complaint filed with or against it that2-31
resulted in arbitration, a lawsuit or other legal proceeding, unless2-32
disclosure is prohibited by law or a court order.2-33
4. A report filed pursuant to this section must be made available for2-34
public inspection within a reasonable time after it is received by the2-35
commissioner.2-36
Sec. 6. Any person who receives, collects, disburses or invests money2-37
for an organization for managed care is responsible for such money in a2-38
fiduciary relationship to the injured employee who is entitled to medical2-39
and health care services and to the employer whose insurer has2-40
contracted with the organization for managed care.2-41
Sec. 7. Each organization for managed care shall authorize2-42
coverage of a medical or health care service that has been recommended2-43
for the injured employee by a provider of health care acting within the3-1
scope of his practice if that service is required to treat the injured3-2
employee and not prohibited by the provisions of chapters 616A to 616D,3-3
inclusive, and 617 of NRS, unless:3-4
1. The determination not to authorize coverage is made by a3-5
physician who:3-6
(a) Is licensed to practice medicine in the State of Nevada pursuant to3-7
chapter 630 of NRS;3-8
(b) Possesses the education, training and expertise to evaluate the3-9
medical condition of the injured employee; and3-10
(c) Has reviewed the available medical documentation, notes of the3-11
attending physician, test results and other relevant medical records of the3-12
injured employee.3-13
The physician may consult with other providers of health care in3-14
determining whether to authorize coverage.3-15
2. The determination not to authorize coverage and the reason for3-16
the decision have been transmitted in writing in a timely manner to the3-17
injured employee, the provider of health care who recommended the3-18
service and the treating physician or chiropractor of the injured3-19
employee, if the treating physician or chiropractor is a different person3-20
than the provider of health care who recommended the service.3-21
Sec. 8. 1. Each organization for managed care shall establish3-22
written criteria:3-23
(a) Setting forth the manner in which it determines whether to3-24
authorize coverage of a medical and health care service; and3-25
(b) Setting forth its method for reviewing standards for the quality of3-26
medical and health care services provided to an injured employee.3-27
2. The written criteria must be:3-28
(a) Consistent with the standards of care for the provision of accident3-29
benefits established by regulations adopted by the administrator pursuant3-30
to NRS 616C.250;3-31
(b) Developed with the assistance of practicing providers of health3-32
care;3-33
(c) Developed using generally recognized and, if appropriate,3-34
specialized clinical principles and processes;3-35
(d) Reviewed at least one time each year and, if appropriate, updated;3-36
and3-37
(e) Made available to an injured employee for review upon request of3-38
the injured employee any time that the organization for managed care3-39
denies coverage of a specific medical or health care service to the injured3-40
employee.3-41
Sec. 9. 1. Each organization for managed care shall provide3-42
coverage for medically necessary emergency services.4-1
2. An organization for managed care shall not require prior4-2
authorization for medically necessary emergency services.4-3
3. A plan for managed care:4-4
(a) Established by an organization for managed care that has4-5
contracted with an insurer; and4-6
(b) Applicable to a policy of industrial insurance that is delivered,4-7
issued for delivery or renewed on or after the effective date of this4-9
has the legal effect of including the coverage required by this section,4-10
and any provision of the plan that is in conflict with this section is void.4-11
4. As used in this section, "medically necessary emergency services"4-12
means medical and health care services that are provided to an injured4-13
employee by a provider of health care after the sudden onset of a medical4-14
condition that manifests itself by symptoms of such sufficient severity4-15
that a prudent person would believe that the absence of immediate4-16
medical attention could result in:4-17
(a) Serious jeopardy to the health of the injured employee;4-18
(b) Serious jeopardy to the health of an unborn child of the injured4-19
employee;4-20
(c) Serious impairment of a bodily function of the injured employee;4-21
or4-22
(d) Serious dysfunction of any bodily organ or part of the injured4-23
employee.4-24
Sec. 10. 1. Each organization for managed care shall establish a4-25
quality assurance program designed to direct, evaluate and monitor the4-26
effectiveness of medical and health care services provided to injured4-27
employees. The program must include, without limitation:4-28
(a) A method for analyzing the outcomes of medical and health care4-29
services;4-30
(b) Peer review;4-31
(c) A system to collect and maintain information related to the4-32
medical and health care services provided to injured employees;4-33
(d) Recommendations for remedial action; and4-34
(e) Written guidelines that set forth the procedures for remedial action4-35
when problems related to quality of care are identified.4-36
2. Each organization for managed care shall:4-37
(a) Maintain a written description of the quality assurance program4-38
established pursuant to subsection 1, including, without limitation, the4-39
specific actions used by the organization for managed care to promote4-40
adequate quality of medical and health care services provided to injured4-41
employees and the persons responsible for such actions;4-42
(b) Provide information to each provider of health care whom it4-43
employs or with whom it contracts to provide medical and health care5-1
services to injured employees regarding the manner in which the quality5-2
assurance program functions;5-3
(c) Provide the necessary staff to implement the quality assurance5-4
program and to evaluate the effectiveness of the program; and5-5
(d) At least one time each year, review the continuity and effectiveness5-6
of the quality assurance program, review any findings of the quality5-7
improvement committee established pursuant to section 11 of this act and5-8
take any reasonable actions to improve the program.5-9
3. Each organization for managed care is responsible for an activity5-10
conducted pursuant to its quality assurance program, regardless of5-11
whether the organization for managed care or another entity performs5-12
the activity.5-13
Sec. 11. 1. As part of a quality assurance program established5-14
pursuant to section 10 of this act, each organization for managed care5-15
shall create a quality improvement committee directed by a physician5-16
who is licensed to practice medicine in the State of Nevada pursuant to5-17
chapter 630 of NRS.5-18
2. Each organization for managed care shall:5-19
(a) Establish written guidelines setting forth the procedure for5-20
selecting the members of the committee;5-21
(b) Select members pursuant to such guidelines; and5-22
(c) Provide staff to assist the committee.5-23
3. The committee shall:5-24
(a) Select and review appropriate medical records of injured5-25
employees and other data related to the quality of medical and health5-26
care provided to injured employees by providers of health care;5-27
(b) Review the clinical processes used by providers of health care in5-28
providing services;5-29
(c) Identify any problems related to the quality of health care provided5-30
to injured employees; and5-31
(d) Advise providers of health care regarding issues related to quality5-32
of care.5-33
Sec. 12. 1. Each organization for managed care shall establish a5-34
system for resolving complaints of an injured employee concerning:5-35
(a) Payment or reimbursement for medical and health care services;5-36
(b) Availability, delivery or quality of medical and health care5-37
services, including, without limitation, an adverse determination made5-38
pursuant to utilization review; or5-39
(c) The terms and conditions of a plan for managed care.5-40
The system must be approved by the commissioner in consultation with5-41
the state board of health.5-42
2. If an injured employee makes an oral complaint, an organization5-43
for managed care shall inform the injured employee that if he is not6-1
satisfied with the resolution of the complaint, he must file the complaint6-2
in writing to receive further review of the complaint.6-3
3. Each organization for managed care shall:6-4
(a) Upon request, assign an employee of the organization for6-5
managed care to assist an injured employee or other person in filing a6-6
complaint or appealing a determination of the review board;6-7
(b) Authorize an injured employee who appeals a determination of the6-8
review board to appear before the review board to present testimony at a6-9
hearing concerning the appeal; and6-10
(c) Authorize an injured employee to introduce any documentation6-11
into evidence at a hearing of a review board and require an injured6-12
employee to provide the documentation required by the plan for managed6-13
care or by the insurer to the review board not later than 5 business days6-14
before a hearing of the review board.6-15
4. The commissioner or the state board of health may examine the6-16
system for resolving complaints established pursuant to this section at6-17
such times as either deems necessary or appropriate.6-18
Sec. 13. 1. A system for resolving complaints created pursuant to6-19
section 12 of this act must include, without limitation:6-20
(a) An initial investigation;6-21
(b) A review of the complaint by a review board;6-22
(c) A procedure for appealing a determination regarding the6-23
complaint; and6-24
(d) A clear description of what constitutes a final determination6-25
pursuant to the system for resolving complaints.6-26
2. The majority of the members of the review board must be injured6-27
employees who receive medical and health care services from the6-28
organization for managed care.6-29
3. Except as otherwise provided in subsection 4, a review board shall6-30
complete its review regarding a complaint or appeal and notify the6-31
injured employee of its determination not later than 14 days after the6-32
complaint or appeal is filed, unless the injured employee and the review6-33
board have agreed to a longer period of time.6-34
4. If a complaint involves an imminent and serious threat to the6-35
health of the injured employee, the organization for managed care shall6-36
inform the injured employee immediately of his right to an expedited6-37
review of his complaint. If an expedited review is required, the review6-38
board shall notify the injured employee in writing of its determination6-39
within 72 hours after the complaint is filed. Notwithstanding the6-40
provisions of NRS 616C.370, a determination of the review board made6-41
pursuant to this subsection constitutes a final determination for purposes6-42
of judicial review.7-1
5. Notice provided to an injured employee by a review board7-2
regarding a complaint must include, without limitation, an explanation7-3
of any further rights of the injured employee regarding the complaint7-4
that are available under the plan for managed care established by the7-5
organization for managed care.7-6
Sec. 14. 1. Each organization for managed care shall submit to the7-7
commissioner and the state board of health an annual report regarding7-8
its system for resolving complaints established pursuant to section 12 of7-9
this act on a form prescribed by the commissioner in consultation with7-10
the state board of health that includes, without limitation:7-11
(a) A description of the procedures used for resolving complaints of7-12
an injured employee;7-13
(b) The total number of complaints and appeals handled through the7-14
system for resolving complaints since the last report and a compilation of7-15
the causes underlying the complaints filed;7-16
(c) The current status of each complaint and appeal filed; and7-17
(d) The average amount of time that was needed to resolve a7-18
complaint and an appeal, if any.7-19
2. Each organization for managed care shall maintain records of7-20
complaints filed with it that concern something other than medical or7-21
health care services and shall submit to the commissioner a report7-22
summarizing those complaints at such times and in such format as the7-23
commissioner may require.7-24
Sec. 15. 1. Following approval by the commissioner, each7-25
organization for managed care shall provide written notice to an injured7-26
employee, in clear and comprehensible language that is understandable7-27
to an ordinary layperson, explaining the right of the injured employee to7-28
file a written complaint and to obtain an expedited review pursuant to7-29
section 13 of this act. The notice must be provided to an injured7-30
employee:7-31
(a) At the time he is hired by the employer whose insurer has7-32
contracted with the organization for managed care;7-33
(b) Any time that the organization for managed care denies coverage7-34
of a medical or health care service or limits coverage of a medical or7-35
health care service to an injured employee; and7-36
(c) Any other time deemed necessary by the commissioner.7-37
2. Any time that an organization for managed care denies coverage7-38
of a medical or health care service to an injured employee it shall notify7-39
the injured employee in writing of:7-40
(a) The reason for denying coverage of the service;7-41
(b) The criteria by which the organization for managed care or7-42
insurer determines whether to authorize or deny coverage of the medical7-43
or health care service; and8-1
(c) His right to file a written complaint.8-2
3. A written notice which is approved by the commissioner shall be8-3
deemed to be in clear and comprehensible language that is8-4
understandable to an ordinary layperson.8-5
Sec. 16. An organization for managed care shall not restrict or8-6
interfere with any communication between a provider of health care and8-7
an injured employee regarding any information that the provider of8-8
health care determines is relevant to the health care of the injured8-9
employee.8-10
Sec. 17. An organization for managed care shall not terminate a8-11
contract with, demote, refuse to contract with or refuse to compensate a8-12
provider of health care solely because the provider, in good faith:8-13
1. Advocates in private or in public on behalf of an injured8-14
employee;8-15
2. Assists an injured employee in seeking reconsideration of a8-16
determination by the organization for managed care to deny coverage for8-17
a medical or health care service; or8-18
3. Reports a violation of law to an appropriate authority.8-19
Sec. 18. 1. An organization for managed care shall not offer or8-20
pay any type of material inducement, bonus or other financial incentive8-21
to a provider of health care to deny, reduce, withhold, limit or delay8-22
specific medically necessary medical or health care services to an injured8-23
employee.8-24
2. The provisions of this section do not prohibit an arrangement for8-25
payment between an organization for managed care and a provider of8-26
health care that uses capitation or other financial incentives, if the8-27
arrangement is designed to provide an incentive to the provider of health8-28
care to use medical and health care services effectively and consistently8-29
in the best interest of the treatment of the injured employee.8-30
Sec. 19. NRS 616B.515 is hereby amended to read as follows: 616B.515 1. Except as otherwise provided in NRS 616B.518, the8-32
manager may enter into a contract or contracts with one or more8-33
organizations for managed care, including health maintenance8-34
organizations, to provide comprehensive medical and health care services8-35
to injured employees whose employers are insured by the system for8-36
injuries and diseases that are compensable under chapters 616A to 617,8-37
inclusive, of NRS. The contract or contracts must be awarded pursuant to8-38
reasonable competitive bidding procedures as established by the manager.8-39
2. After the selection of an organization for managed care, the bids8-40
received by the manager and the records related to the bidding are subject8-41
to review by any member of the public upon request.8-42
3. An organization for managed care or a health maintenance8-43
organization9-1
(a) Shall not discriminate against or exclude a provider of health care9-2
from participation in the organization’s proposed plan for providing9-3
medical and health care services because of race, creed, sex, national9-4
origin, age or disability.9-5
(b) Shall comply with the provisions of sections 2 to 18, inclusive, of9-6
this act.9-7
Sec. 20. NRS 616B.527 is hereby amended to read as follows: 616B.527 A self-insured employer, an association of self-insured9-9
public or private employers or a private carrier may:9-10
1. Enter into a contract or contracts with one or more organizations for9-11
managed care to provide comprehensive medical and health care services9-12
to employees for injuries and diseases that are compensable pursuant to9-13
chapters 616A to 617, inclusive, of NRS.9-14
2. Enter into a contract or contracts with providers of health care,9-15
including, without limitation, physicians who provide primary care,9-16
specialists, pharmacies, physical therapists, radiologists, nurses, diagnostic9-17
facilities, laboratories, hospitals and facilities that provide treatment to9-18
outpatients, to provide medical and health care services to employees for9-19
injuries and diseases that are compensable pursuant to chapters 616A to9-20
617, inclusive, of NRS.9-21
3. Use the services of an organization for managed care that has9-22
entered into a contract with the manager pursuant to NRS 616B.515, but is9-23
not required to use such services.9-24
4. Require employees to obtain medical and health care services for9-25
their industrial injuries from those organizations and persons with whom9-26
the self-insured employer, association or private carrier has contracted9-27
pursuant to subsections 1 and 2, or as the self-insured employer,9-28
association or private carrier otherwise prescribes.9-29
5.9-30
require employees to obtain the approval of the self-insured employer,9-31
association or private carrier before obtaining medical and health care9-32
services for their industrial injuries from a provider of health care who has9-33
not been previously approved by the self-insured employer, association or9-34
private carrier.9-35
6. An organization for managed care with whom a self-insured9-36
employer, association of self-insured public or private employers or a9-37
private carrier has contracted pursuant to this section shall comply with9-38
the provisions of sections 2 to 18, inclusive, of this act.9-39
Sec. 21. NRS 616C.305 is hereby amended to read as follows: 616C.305 1. Except as otherwise provided in subsection9-41
person who is aggrieved by a9-42
accident benefits made by an organization for managed care which has9-43
contracted with an insurer must, within 14 days of the10-1
determination and before requesting a resolution of the dispute pursuant to10-2
NRS 616C.345 to 616C.385, inclusive, appeal that10-3
determination in accordance with the procedure for resolving complaints10-4
established by the organization for managed care. If the aggrieved person10-5
is an injured employee, he must appeal that decision in accordance with10-6
the provisions of sections 12 and 13 of this act and the system for10-7
resolving complaints established by the organization for managed care10-8
pursuant thereto.10-9
2.10-10
10-11
10-12
10-13
10-14
10-15
for resolving complaints established by an organization for managed care10-16
and the dispute is not resolved within10-17
or, if the aggrieved person is an injured employee, the longer period10-18
agreed to by an injured employee and the review board pursuant to10-19
section 13 of this act, he may request a resolution of the dispute pursuant10-20
to NRS 616C.345 to 616C.385, inclusive.10-21
Sec. 22. NRS 616C.345 is hereby amended to read as follows: 616C.345 1. Any party aggrieved by a decision of the hearing officer10-23
relating to a claim for compensation may appeal from the decision by10-24
filing a notice of appeal with an appeals officer within 30 days after the10-25
date of the decision.10-26
2. If a dispute is required to be submitted to a procedure for resolving10-27
complaints pursuant to NRS 616C.305 and:10-28
(a) A final10-29
procedure; or10-30
(b) The dispute was not resolved pursuant to that procedure within10-31
30 days after it was submitted10-32
injured employee and the review board pursuant to section 13 of this10-34
any party to the dispute may file a notice of appeal within 70 days after the10-35
date on which the final10-36
employee, or his dependent, or the unanswered request for resolution was10-37
submitted. Failure to render a written10-38
days after receipt of such a request , or the longer period agreed to by an10-39
injured employee and the review board pursuant to section 13 of this act,10-40
shall be deemed by the appeals officer to be a denial of the request.10-41
3. Except as otherwise provided in NRS 616C.380, the filing of a10-42
notice of appeal does not automatically stay the enforcement of the10-43
decision of a hearing officer or a11-1
pursuant to NRS 616C.305. The appeals officer may order a stay, when11-2
appropriate, upon the application of a party. If such an application is11-3
submitted, the decision is automatically stayed until a determination is11-4
made concerning the application. A determination on the application must11-5
be made within 30 days after the filing of the application. If a stay is not11-6
granted by the officer after reviewing the application, the decision must be11-7
complied with within 10 days after the date of the refusal to grant a stay.11-8
4. Except as otherwise provided in this subsection, the appeals officer11-9
shall, within 10 days after receiving a notice of appeal pursuant to this11-10
section or a contested claim pursuant to subsection 5 of NRS 616C.315,11-11
schedule a hearing on the merits of the appeal or contested claim for a date11-12
and time within 90 days after his receipt of the notice and give notice by11-13
mail or by personal service to all parties to the matter and their attorneys or11-14
agents at least 30 days before the date and time scheduled. A request to11-15
schedule the hearing for a date and time which is:11-16
(a) Within 60 days after the receipt of the notice of appeal or contested11-17
claim; or11-18
(b) More than 90 days after the receipt of the notice or claim,11-19
may be submitted to the appeals officer only if all parties to the appeal or11-20
contested claim agree to the request.11-21
5. An appeal or contested claim may be continued upon written11-22
stipulation of all parties, or upon good cause shown.11-23
6. Failure to file a notice of appeal within the period specified in11-24
subsection 1 or 2 may be excused if the party aggrieved shows by a11-25
preponderance of the evidence that he did not receive the notice of the11-26
11-27
determination. The claimant, employer or insurer shall notify the hearing11-28
officer of a change of address.11-29
Sec. 23. The provisions of this act apply to all contracts between an11-30
insurer and an organization for managed care for the provisions of11-31
comprehensive medical and health care services to injured employees11-32
entered into or renewed on or after October 1, 1999.~