GENERAL ASSEMBLY OF NORTH CAROLINA
Apr 9, 2019
SESSION 2019 HOUSE PRINCIPAL CLERK
HOUSE BILL DRH50060-MR-91B*
Short Title: Medicaid Changes for Transformation. (Public)
Sponsors: Representatives Lambeth, Dobson, Murphy, and Sasser (Primary Sponsors).
1 A BILL TO BE ENTITLED
2 AN ACT TO MODIFY THE LAWS PERTAINING TO MEDICAID AND NC HEALTH
3 CHOICE AS NEEDED FOR THE IMPLEMENTATION OF MEDICAID
5 The General Assembly of North Carolina enacts:
6 SECTION 1.(a) Chapter 108D of the General Statutes reads as rewritten:
7 "Chapter 108D.
8 "Medicaid and NC Health Choice Managed Care for Behavioral Health Services.
10 "Article 1.
11 "General Provisions.
12 "§ 108D-1. Definitions.
13 The following definitions apply in this Chapter, unless the context clearly requires otherwise:
14 (1) Adverse benefit determination. – As defined in 42 C.F.R. § 438.400(b). In
15 accordance with 42 C.F.R. § 457.1260, this definition applies to NC Health
16 Choice beneficiaries in the same manner as it applies to Medicaid
18 (1a) Adverse disenrollment determination. – A determination by the Department
19 of Health and Human Services or the enrollment broker to (i) deny a request
20 made by an enrollee, or the enrollee's authorized representative, to disenroll
21 from a prepaid health plan or (ii) approve a request made by a prepaid health
22 plan to disenroll an enrollee from a prepaid health plan.
23 (1b) Applicant. – A provider of mental health, intellectual or developmental
24 disabilities, and substance abuse services who is seeking to participate in the
25 closed network of one or more local management entity/managed care
26 organizations.organizations or prepaid health plans.
27 (1c) Beneficiary. – A person to whom or on whose behalf medical assistance or
28 assistance through the North Carolina Health Choice for Children program is
29 granted under Article 2 of Chapter 108A of the General Statutes.
30 (1d) Behavioral Health and Individuals with Developmental Disabilities Tailored
31 Plan or BH IDD Tailored Plan. – A capitated prepaid health plan contract
32 under the Medicaid transformation demonstration waiver that meets all of the
33 requirements of Article 4 of this Chapter, including the requirements
34 pertaining to BH IDD Tailored Plans.
35 (2) Closed network. – The network of providers that have contracted with a local
36 management entity/managed care organization to furnish mental health,
General Assembly Of North Carolina Session 2019
1 intellectual or developmental disabilities, and substance abuse services to
3 (3) Contested case hearing. – The hearing or hearings conducted at the Office of
4 Administrative Hearings under G.S. 108D-15 to resolve a dispute between an
5 enrollee and a local management entity/managed care organization about a
6 managed care action.G.S. 108D-5.5 or G.S. 108D-15.
7 (4) Department. – The North Carolina Department of Health and Human
9 (5) Emergency medical condition. – As defined in 42 C.F.R. § 438.114.
10 (6) Emergency services. – As defined in 42 C.F.R. § 438.114.
11 (7) Enrollee. – A Medicaid or NC Health Choice beneficiary who is currently
12 enrolled with a local management entity/managed care
13 organization.organization or a prepaid health plan.
14 (7a) Enrollment broker. – As defined in 42 C.F.R. § 438.810(a).
15 (7b) Fee-for-service program. – A payment model for the Medicaid and NC Health
16 Choice programs operated by the Department of Health and Human Services
17 pursuant to its authority under Part 6 and Part 8 of Article 2 of Chapter 108A
18 of the General Statutes in which the Department pays enrolled providers for
19 services provided to Medicaid and NC Health Choice beneficiaries rather than
20 contracting for the coverage of services through a capitated payment
22 (8) Local Management Entity or LME. – As defined in
23 G.S. 122C-3(20b).G.S. 122C-3.
24 (9) Local Management Entity/Managed Care Organization or LME/MCO. – As
25 defined in G.S. 122C-3(20c).G.S. 122C-3.
26 (10) Managed care action. – An action, as defined in 42 C.F.R. § 438.400(b).
27 (10a) Mail. – United States mail or, if the enrollee or the enrollee's authorized
28 representative has given written consent to receive electronic
29 communications, electronic mail.
30 (10b) Managed care entity. – A local management entity/managed care organization
31 or a prepaid health plan.
32 (11) Managed Care Organization or MCO. – As defined in 42 C.F.R. § 438.2.
33 (11b) Medicaid transformation demonstration waiver. – The waiver agreement
34 entered into between the State and the Centers for Medicare and Medicaid
35 Services under Section 1115 of the Social Security Act for the transition to
36 prepaid health plans.
37 (12) Mental health, intellectual or developmental disabilities, and substance abuse
38 services or MH/IDD/SA services. – Those mental health, intellectual or
39 developmental disabilities, and substance abuse services covered by a local
40 management entity/managed care organization under a contract in effect
41 between with the Department of Health and Human Services and a local
42 management entity to operate a managed care organization or prepaid
43 inpatient health plan (PIHP) under the 1915(b)/(c) Medicaid Waiver approved
44 by the federal Centers for Medicare and Medicaid Services (CMS).the
45 combined Medicaid waiver program authorized under Section 1915(b) and
46 Section 1915(c) of the Social Security Act.
47 (13) Network provider. – An appropriately credentialed provider of mental health,
48 intellectual or developmental disabilities, and substance abuse services that
49 has entered into a contract for participation in the closed network of one or
50 more local management entity/managed care organizations.organizations or
51 prepaid health plans.
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1 (14) Notice of managed care action. adverse benefit determination. – The notice
2 required by 42 C.F.R. § 438.404.
3 (15) Notice of resolution. – The notice described in 42 C.F.R. § 438.408(e).
4 (16) OAH. – The North Carolina Office of Administrative Hearings.
5 (16a) Prepaid health plan or PHP. – A prepaid health plan, as defined in
6 G.S. 58-93-5, or a local management entity/managed care organization
7 operating a BH IDD Tailored Plan.
8 (17) Prepaid Inpatient Health Plan or PIHP. – As defined in 42 C.F.R. § 438.2.
9 (17a) Provider. – As defined in G.S. 108C-2.
10 (18) Provider of emergency services. – A provider that is qualified to furnish
11 emergency services to evaluate or stabilize an enrollee's emergency medical
13 (19) Standard plan. – A capitated prepaid health plan contract under the Medicaid
14 transformation demonstration waiver that meets all of the requirements of
15 Article 4 of this Chapter except for the requirements pertaining to BH IDD
16 Tailored Plan.
17 "§ 108D-2. Scope; applicability of this Chapter.
18 This Chapter applies to every LME/MCO and to every managed care entity, applicant,
19 enrollee, provider of emergency services, and network provider of an LME/MCO.a managed care
20 entity. This Chapter does not apply to Medicaid or NC Health Choice services delivered through
21 the fee-for-service program. Nothing in this Chapter shall be construed to grant a NC Health
22 Choice beneficiary benefits in excess of what is required by G.S. 108A-70.21.
23 "§ 108D-3. Conflicts; severability.
24 (a) To the extent that this Chapter conflicts with the Social Security Act or 42 C.F.R. Part
25 438, Parts 438 and 457, federal law prevails.prevails, except when the applicability of federal
26 law or rules have been waived by agreement between the State and the U.S. Department of Health
27 and Human Services.
28 (b) To the extent that this Chapter conflicts with any other provision of State law that is
29 contrary to the principles of managed care that will ensure successful containment of costs for
30 behavioral health care services, this Chapter prevails and applies.
31 (c) If any section, term, or provision of this Chapter is adjudged invalid for any reason,
32 these judgments shall not affect, impair, or invalidate any other section, term, or provision of this
33 Chapter, but the remaining sections, terms, and provisions shall be and remain in full force and
35 "Article 1A.
36 "Disenrollment from Prepaid Health Plans.
37 "§ 108D-5.1. General provisions.
38 (a) Nothing in this Article shall be construed to limit or prevent the Department from
39 disenrolling, from a PHP, an enrollee who (i) is no longer eligible to receive services through the
40 Medicaid or NC Health Choice programs or (ii) becomes a member of a population of
41 beneficiaries that is not required to enroll in a PHP under State law.
42 (b) Nothing in this Article shall be construed to exclude a Medicaid or NC Health Choice
43 beneficiary who is otherwise required by State law to enroll in a PHP from enrolling in a PHP,
44 or to prevent a beneficiary who is otherwise exempted from enrollment in a PHP from
45 disenrolling from a PHP and receiving services through the fee-for-service program.
46 "§ 108D-5.2. Enrollee requests for disenrollment.
47 (a) In General. – An enrollee, or the enrollee's authorized representative, who is
48 requesting disenrollment from a PHP, shall submit an oral or written request for disenrollment to
49 the enrollment broker.
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1 (b) Without Cause Enrollee Requests or Disenrollment. – An enrollee shall be allowed to
2 disenroll from the PHP without cause only during the times specified in 42 C.F.R. § 438.56(c)(2),
3 except that enrollees who are in any of the following groups may disenroll at any time:
4 (1) Members of federally recognized tribes.
5 (2) Beneficiaries who are enrolled in the foster care system.
6 (3) Beneficiaries who are in the former foster care Medicaid eligibility category.
7 (4) Beneficiaries who receive Title IV-E adoption assistance.
8 (5) Beneficiaries under the age of 26 who formerly received Title IV-E adoption
10 (6) Beneficiaries who are receiving long-term services and supports in
11 institutional or community-based settings.
12 (7) Any other beneficiaries who are not required to enroll in a PHP under State
14 (c) With Cause Enrollee Requests for Disenrollment. – An enrollee, or the enrollee's
15 authorized representative, may submit a request to disenroll from a PHP for cause at any time.
16 For cause reasons for disenrollment from a PHP include the following:
17 (1) The enrollee moves out of the PHP's service area.
18 (2) The PHP, because of the PHP's moral or religious objections, does not cover
19 a service the enrollee seeks.
20 (3) The enrollee needs concurrent, related services that are not all available within
21 the PHP's network and the enrollee's provider determines that receiving
22 services separately would subject the enrollee to unnecessary risk.
23 (4) An enrollee who receives long-term services and supports will be required to
24 change residential, institutional, or employment supports providers due to the
25 enrollee's provider's change from in-network to out-of-network status with the
26 PHP and, as a result, the enrollee would experience a disruption in residence
27 or employment.
28 (5) The enrollee's complex medical conditions could be better served under a
29 different PHP. For purposes of this subsection, an enrollee is considered to
30 have a complex medical condition if the enrollee has a condition that could
31 seriously jeopardize the enrollee's life or health or ability to attain, maintain,
32 or regain maximum function.
33 (6) A family member of the enrollee becomes, or is determined, eligible for
34 Medicaid or NC Health Choice and the family member is, or becomes,
35 enrolled in a different PHP.
36 (7) Poor performance by the PHP, as determined by the Department. The
37 Department shall not make a determination of poor performance by any PHP
38 until the Department has completed an annual PHP performance evaluation
39 following the first year of that PHP's contract.
40 (8) Poor quality of care, lack of access to services covered under the PHP's
41 contract, lack of access to providers experienced in addressing the enrollee's
42 health care needs, or any other reasons established by the Department in the
43 PHP's contract or in rule.
44 (d) Expedited Enrollee Requests for Disenrollment. – An enrollee, or the enrollee's
45 authorized representative, may submit an expedited request for disenrollment to the enrollment
46 broker when the enrollee has an urgent medical need that requires disenrollment from the PHP.
47 For purposes of this subsection, an urgent medical need means that continued enrollment in the
48 PHP could jeopardize the enrollee's life, health, or ability to attain, maintain, or regain maximum
50 "§ 108D-5.3. PHP requests for disenrollment.
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1 (a) In General. – A PHP requesting disenrollment of an enrollee from the PHP shall
2 submit a written request for disenrollment to the enrollment broker.
3 (b) Limitations on PHP Requests for Disenrollment. – A PHP shall not request
4 disenrollment of an enrollee from the PHP for any reason prohibited by 42 C.F.R. § 438.56(b)(2).
5 A PHP may request disenrollment of an enrollee only when both of the following criteria are
7 (1) The enrollee's behavior seriously hinders the PHP's ability to care for the
8 enrollee or other enrollees of the PHP.
9 (2) The PHP has documented efforts to resolve the issues that form the basis of
10 the request for disenrollment of the enrollee.
11 "§ 108D-5.4. Notices.
12 (a) Notices of Resolution. – For each disenrollment request by an enrollee or a PHP, the
13 Department shall issue a written notice of resolution approving or denying the request by mail to
14 the enrollee before the first day of the second month following the month in which the enrollee
15 or PHP requested disenrollment. For expedited enrollee requests for disenrollment made under
16 G.S. 108D-5.2(d), the Department shall issue the written notice of resolution approving or
17 denying the expedited request within three calendar days of receipt of the request. In the same
18 mailing as the notice, the Department shall also provide the enrollee with an appeal request form
19 that includes all of the following:
20 (1) A statement that in order to request an appeal, the enrollee must file the form
21 in accordance with OAH rules, by mail or fax to the address or f