Bill Summary – FastDemocracy

Senate File 2384 - Introduced
                                  SENATE FILE 2384
                                  BY COMMITTEE ON COMMERCE
                                  (SUCCESSOR TO SSB 3137)
                            A BILL FOR
An Act relating to contracts and payments for dental care
  service plans.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
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    Section 1. NEW SECTION. 514C.3C Dental care service plan
 contracts.
    1. Definitions. As used in this section unless the context
 otherwise provides:
    a. “Commissioner” means the commissioner of insurance.
    b. “Contracting entity” means any person, third-party
 administrator, health carrier, or dental carrier that enters
 into a contract with a dental care provider for the delivery
 of dental care services.
    c. “Covered person” means a policyholder, subscriber,
 enrollee, or other individual participating in a dental care
 service plan or health benefit plan that provides for dental
 care services.
    d. “Dental care provider” means any person licensed to
 practice dentistry pursuant to chapter 153, and who provides
 dental care services pursuant to a dental care service plan or
 health benefit plan.
    e. “Dental care service plan” means a policy, contract,
 plan, certificate, or agreement that provides for third-party
 payment or prepayment of dental care services and that is
 delivered or issued for delivery by or through a dental carrier
 on a stand-alone basis. “Dental care service plan” includes a
 health benefit plan that provides for dental care services.
    f. “Dental care services” means the same as defined in
 section 514J.102. “Dental care services” does not include
 services that are billed as medical expenses under a health
 benefit plan.
    g. “Dental carrier” means an entity subject to the
 insurance laws and regulations of this state, or subject to
 the jurisdiction of the commissioner, including an insurance
 company offering dental care service plans, or any other entity
 that provides a dental care service plan.
    h. “Dental service contractor” means any person who accepts
 a prepayment from, or for the benefit of, another person as
 consideration for the provision of future dental care services.
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 “Dental service contractor” does not include a dental care
 provider that accepts prepayment on a fee-for-service basis for
 providing specific dental services to individual patients for
 whom such services have been prediagnosed.
    i. “Dentist agent” means a person that contracts with
 a dental care provider to establish an agency relationship
 for purposes of processing bills for services provided by
 the dental care provider under the terms and conditions
 of a contract between the dentist agent and a health care
 provider. A contract between a dentist agent and a health care
 provider may permit the dentist agent to submit bills, request
 reconsideration, and receive reimbursement.
    j. “Health benefit plan” means the same as defined in
 section 514J.102.
    k. “Health carrier” means the same as defined in section
 514J.102.
    l. “Network contract” means a contract between a contracting
 entity and a dental care provider that specifies the rights and
 responsibilities of the contracting entity and provides for the
 delivery and payment of dental services to a covered person.
    m. “Third party” means a person, not including a covered
 person, that enters into a contract with a contracting entity
 to access the dental services or contractual discounts of a
 network contract. “Third party” does not include an employer or
 other group for whom the dental carrier or contracting entity
 provides administrative services.
    n. “Virtual credit card payment” means an electronic funds
 transfer in which a dental care service plan, or a contracted
 vendor, issues a single-use series of numbers associated with
 the payment of dental care services performed by a dental care
 provider and chargeable to a predetermined dollar amount, where
 the dental care provider is responsible for processing the
 payment by a credit card terminal or internet portal. “Virtual
 credit card payment” includes only electronic or virtual credit
 card payments, where no physical credit card is used and
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 the single-use electronic credit card expires upon payment
 processing.
    2. Third-party access to network contracts.
    a. A contracting entity may grant a third party access
 to a network contract, or to a dental care provider’s dental
 care services or contractual discounts provided pursuant to a
 network contract, if all of the following requirements are met:
    (1) If the contracting entity is a dental carrier or health
 carrier, at the time the network contract is entered into,
 renewed, or material modifications relevant to granting access
 to a third party are made, the contracting entity allows any
 dental care provider that is part of the contracting entity’s
 network contract to choose not to participate in third-party
 access to the network contract, or to enter into a contract
 directly with the third party. If a dental care provider opts
 out of lease arrangements, a contracting entity shall not
 cancel or terminate a contractual relationship with, or refuse
 to contract with, the dental care provider.
    (2) The network contract specifically states that the
 contracting entity may enter into an agreement with a third
 party to allow the third party to obtain the contracting
 entity’s rights and responsibilities under the network
 contract as if the third party were the contracting entity.
 If the contracting entity is a dental carrier, the network
 contract must specifically state that the dental care provider
 may choose not to participate in third-party access to the
 network contract, and that the dental care provider chose to
 participate in third-party access at the time the network
 contract was entered into or renewed.
    (3) The third party accessing the network contract agrees to
 comply with all of the network contract’s terms.
    (4) The contracting entity identifies to the dental care
 provider, in writing, all third parties participating in the
 network contract as of the date the network contract is entered
 into or renewed.
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    (5) The contracting entity provides a list of all
 third parties participating in the network contract on the
 contracting entity’s internet site and the list of third
 parties is updated at least once every ninety days.
    (6) The contracting entity notifies a dental care provider
 under the network contract at least thirty days prior to a new
 third party leasing or purchasing the network contract.
    (7) The contracting entity requires a third party to
 identify, for all remittance advice or explanations of payment
 under which a discount applies, the source of the discount.
 This subparagraph does not apply to an electronic transaction
 mandated by the federal Health Insurance Portability and
 Accountability Act of 1996, Pub. L. No. 104-191.
    (8) The contracting entity notifies a third party of the
 termination of a network contract no later than thirty days
 from the termination date of the network contract.
    (9) A third party’s right to a dental care provider’s
 discounted rate is terminated as of the termination date of the
 network contract.
    (10) In the adjudication of a claim under the network
 contract, the contracting entity makes available to the
 dental care provider a copy of the network contract no later
 than thirty days after a request for the network contract is
 received.
    b. This section shall not apply to access to a network
 contract provided to a third party that is either an affiliate
 of, or operating under the same brand licensing as, the
 contracting entity. A contracting entity shall provide a list
 of all affiliates on the contracting entity’s internet site.
    c. No dental care provider shall be bound by, or required to
 perform, dental care services under a network contract that has
 been granted to a third party in violation of this section.
    3. Dental care service plans —— method of payment.
    a. A dental care service plan shall not require payments
 to be made to dental care providers by virtual credit card
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 payment.
    b. A dental care service plan, when initiating payments to
 a dental care provider via virtual credit card payment, or when
 changing the method of payment for a dental care provider to
 virtual credit card payments, shall do all of the following:
    (1) Notify the dental care provider of any fees associated
 with each payment method.
    (2) Inform the dental care provider of the available options
 for methods of payment and provide clear instructions to the
 dental care provider for the selection of an alternative
 payment method.
    c. A dental care service plan that transmits payments to
 a dental care provider in accordance with the standards of 45
 C.F.R. §162.1601 and 162.1602 shall not charge a fee solely for
 the transmission of the payment to the dental care provider
 unless the dental care provider has consented to payment of
 the fee. When transmitting a national automated clearinghouse
 payment, a dentist agent may charge a reasonable fee related
 to bank transmittal, transaction management, data management,
 portal services, and other value-added services.
    4. Waiver prohibited. The requirements of this section
 shall not be waived by contract. Any contract contrary to this
 section shall be null and void.
    5. Rules. The commissioner may adopt rules pursuant to
 chapter 17A to administer this chapter.
                           EXPLANATION
         The inclusion of this explanation does not constitute agreement with
          the explanation’s substance by the members of the general assembly.
    This bill relates to contracts and payments for dental care
 service plans.
    The bill permits a contracting entity to grant third-party
 access to a network contract (contract), or to a dental care
 provider’s (provider) dental care services or contractual
 discounts provided pursuant to a contract, if all of the
 following requirements are met: (1) the contracting entity
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 allows a dental carrier or health carrier, at the time the
 contract is entered into, renewed, or modified, to choose
 not to participate in third-party access or to enter into a
 contract directly with the third party, and if a provider
 opts out of lease arrangements, a contracting entity shall
 not cancel or terminate a contractual relationship with, or
 refuse to contract with, the provider; (2) the contract states
 that the contracting entity may enter into an agreement to
 allow the third party to obtain the contracting entity’s
 rights and responsibilities under the contract; (3) the third
 party agrees to comply with all of the contract’s terms; (4)
 the contracting entity identifies to the provider all third
 parties participating in the contract when it is entered
 into or renewed; (5) the contracting entity provides a list
 of all third parties participating in the contract on the
 contracting entity’s internet site and the list is updated at
 least once every 90 days; (6) the contracting entity notifies a
 provider at least 30 days prior to a new third party leasing or
 purchasing the contract; (7) the contracting entity requires
 a third party to identify, for all remittance advice or
 explanations of payment under which a discount applies, the
 source of the discount; (8) the contracting entity notifies a
 third party no later than 30 days from the termination date
 of the contract; (9) a third party’s right to a provider’s
 discounted rate is terminated as of the termination date of
 the contract; and (10) in the adjudication of a claim, the
 contracting entity makes available to the provider a copy of
 the contract no later than 30 days after a request for the
 contract is received. “Contracting entity”, “dental care
 provider”, “network contract”, “third party”, “dental carrier”,
 and “health carrier” are defined in the bill. A provider shall
 not be bound by, or required to perform, dental care services
 under a contract that has been granted in violation of the
 bill.
    The bill prohibits a dental care service plan from requiring
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 payments to be made to a provider by virtual credit card
 payment. “Virtual credit card payment” is defined in the
 bill. A dental care service plan, when initiating payments
 to, or changing payment methods for, a provider via virtual
 credit card payment, the dental care service plan is required
 to notify the provider of any fees associated with each
 payment method, inform the provider of the available options
 for methods of payment, and provide clear instructions to the
 provider for the selection of an alternative payment method. A
 dental care service plan that transmits payments to a provider
 in accordance with the standards of 45 C.F.R. §162.1601 and
 162.1602 shall not charge a fee solely for the transmission
 unless the provider has consented to payment of the fee. A
 dentist agent that transmits payments through the national
 automated clearinghouse may charge a reasonable fee related
 to bank transmittal, transaction management, data management,
 portal services, and other value-added services.
    The requirements of the bill shall not be waived by contract,
 and any contract to the contrary is null and void.
    The commissioner of insurance may adopt rules to administer
 the bill.
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