HOUSE AMENDED
PRIOR PRINTER'S NOS. 453, 948, 1809,
1837, 1924 PRINTER'S NO. 2004
THE GENERAL ASSEMBLY OF PENNSYLVANIA
SENATE BILL
No. 225
Session of
2021
INTRODUCED BY PHILLIPS-HILL, MARTIN, J. WARD, MENSCH, COLLETT,
MUTH, KANE, STEFANO, AUMENT, CAPPELLETTI, BAKER, BROOKS,
BOSCOLA, HUTCHINSON, SABATINA, TOMLINSON, LAUGHLIN,
MASTRIANO, SANTARSIERO, KEARNEY, SCHWANK, DUSH, COMITTA,
FLYNN, L. WILLIAMS AND DILLON, MARCH 18, 2021
AS AMENDED ON SECOND CONSIDERATION, HOUSE OF REPRESENTATIVES,
OCTOBER 25, 2022
AN ACT
1 Amending the act of May 17, 1921 (P.L.682, No.284), entitled "An
2 act relating to insurance; amending, revising, and
3 consolidating the law providing for the incorporation of
4 insurance companies, and the regulation, supervision, and
5 protection of home and foreign insurance companies, Lloyds
6 associations, reciprocal and inter-insurance exchanges, and
7 fire insurance rating bureaus, and the regulation and
8 supervision of insurance carried by such companies,
9 associations, and exchanges, including insurance carried by
10 the State Workmen's Insurance Fund; providing penalties; and
11 repealing existing laws," in quality health care <--
12 accountability and protection, further providing for
13 definitions, for responsibilities of managed care plans, for
14 financial incentives prohibition, for medical gag clause
15 prohibition, for emergency services, for continuity of care,
16 providing for medication assisted treatment, further
17 providing for procedures, for confidentiality, for required
18 disclosure, providing for medical policy and clinical review
19 criteria adopted by insurer, MCO or contractor, further
20 providing for internal complaint process, for appeal of
21 complaint, for complaint resolution, for certification, for
22 operational standards, providing for step therapy
23 considerations, for prior authorization review and for
24 provider portal, further providing for internal grievances
25 process, for records, for external grievance process, for
26 prompt payment of claims, for health care provider and
27 managed care plan, for departmental powers and duties, for
28 penalties and sanctions, for compliance with National
 1 Accrediting Standards; and making editorial changes. IN <--
2 QUALITY HEALTH CARE ACCOUNTABILITY AND PROTECTION, FURTHER
3 PROVIDING FOR DEFINITIONS, FOR RESPONSIBILITIES OF MANAGED
4 CARE PLANS, FOR FINANCIAL INCENTIVES PROHIBITION, FOR MEDICAL
5 GAG CLAUSE PROHIBITION, FOR EMERGENCY SERVICES, FOR
6 CONTINUITY OF CARE, FOR PROCEDURES, FOR CONFIDENTIALITY, FOR
7 REQUIRED DISCLOSURE AND FOR INTERNAL COMPLAINT PROCESS,
8 PROVIDING FOR INTERNAL COMPLAINT PROCESS FOR ENROLLEES,
9 FURTHER PROVIDING FOR APPEAL OF COMPLAINT, FOR COMPLAINT
10 RESOLUTION, FOR CERTIFICATION AND FOR OPERATIONAL STANDARDS,
11 PROVIDING FOR UTILIZATION REVIEW STANDARDS, FURTHER PROVIDING
12 FOR INTERNAL GRIEVANCE PROCESS, FOR EXTERNAL GRIEVANCE
13 PROCESS AND FOR RECORDS, PROVIDING FOR ADVERSE BENEFIT
14 DETERMINATIONS, FURTHER PROVIDING FOR PROMPT PAYMENT OF
15 CLAIMS, FOR HEALTH CARE PROVIDER AND MANAGED CARE PLAN
16 PROTECTION, FOR DEPARTMENTAL POWERS AND DUTIES, FOR
17 CONFIDENTIALITY AND FOR PENALTIES AND SANCTIONS, PROVIDING
18 FOR REGULATIONS AND FURTHER PROVIDING FOR COMPLIANCE WITH
19 NATIONAL ACCREDITING STANDARDS AND FOR EXCEPTIONS; MAKING
20 REPEALS; AND MAKING EDITORIAL CHANGES.
21 The General Assembly of the Commonwealth of Pennsylvania
22 hereby enacts as follows:
23 Section 1. The definitions of "complaint," "drug formulary," <--
24 "enrollee," "grievance," "health care service," "prospective
25 utilization review," "provider network," "retrospective
26 utilization review," "utilization review" and "utilization
27 review entity" in section 2102 of the act of May 17, 1921
28 (P.L.682, No.284), known as The Insurance Company Law of 1921,
29 are amended and the section is amended by adding definitions to
30 read:
31 Section 2102. Definitions.--As used in this article, the
32 following words and phrases shall have the meanings given to
33 them in this section:
34 * * *
35 "Administrative policy." A written document or collection of
36 documents reflecting the terms of the contractual or operating
37 relationship between an insurer, MCO, contractor and a health
38 care provider.
39 "Administrative denial." A denial of prior authorization,
40 coverage or payment based on a lack of eligibility, failure to
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 1 submit complete information or other failure to comply with
2 written administrative standards for the administration of
3 benefits under a health insurance policy, MCO contract or CHIP
4 contract. The term does not include a denial based on medical
5 necessity.
6 "Adverse benefit determination." A determination by an
7 insurer, MCO, contractor or a utilization review entity
8 designated by the insurer, MCO or contractor that a health care
9 service has been reviewed and, based upon the information
10 provided, does not meet the insurer's, MCO's or contractor's
11 requirements for medical necessity, appropriateness, health care
12 setting, level of care or effectiveness and the requested
13 service or payment for the service is therefore denied, reduced
14 or terminated.
15 * * *
16 "Applicable governmental guidelines." Clinical practice and
17 associated guidelines issued under the authority of the United
18 States Department of Health and Human Services, United States
19 Food and Drug Administration, Centers for Disease Control and
20 Prevention, Department of Health or other similarly situated
21 Federal or State agency, department or subunit thereof focused
22 on the provision or regulation of medical care, prescription
23 drugs or public health within the United States.
24 "Children's Health Insurance Program" or "CHIP." The
25 children's health care program under Article XXIII-A.
26 "CHIP contract." The agreement between an insurer and the
27 Department of Human Services to provide for services to a CHIP
28 enrollee.
29 * * *
30 "Clinical review criteria." The set of written screening
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 1 procedures, decision abstracts, clinical protocols and practice
2 guidelines used by an insurer, MCO or contractor to determine
3 the necessity and appropriateness of health care services.
4 "Closely related service." One or more health care services
5 subject to prior authorization that are closely related in
6 purpose, diagnostic utility or designated health care billing
7 code and provided on the same date of service such that a
8 prudent health care provider, acting within the scope of the
9 health care provider's license and expertise, might reasonably
10 be expected to perform such service in conjunction with or in
11 lieu of the originally authorized service in response to minor
12 differences in observed patient characteristics or needs for
13 diagnostic information that were not readily identifiable until
14 the health care provider was actually performing the originally
15 authorized service. The term does not include an order for or
16 administration of a prescription drug or any part of a series or
17 course of treatments.
18 "Complaint." A dispute or objection regarding a
19 participating health care provider or the coverage, operations
20 or management policies of [a managed care plan] an insurer, MCO
21 or contractor, which has not been resolved by the [managed care
22 plan] insurer, MCO or contractor and has been filed with the
23 [plan] insurer, MCO or contractor or with the Department of
24 Health or the Insurance Department of the Commonwealth. The term
25 does not include a grievance.
26 "Complete prior authorization request." A request for prior
27 authorization that meets an insurer's, MCO's or contractor's
28 administrative policy requirements for such a request and that
29 includes the specific clinical information necessary only to
30 evaluate the request under the terms of the applicable medical
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 1 policy. To the extent a health care provider network agreement
2 requires medical records to be transmitted electronically, or a
3 health care provider is capable of transmitting medical records
4 electronically to support a complete prior authorization request
5 for a health care service, the health care provider shall ensure
6 the insurer, MCO or contractor has electronic access to,
7 including the ability to print, the medical records that have
8 been transmitted electronically, subject to any applicable law
9 and the health care provider's corporate policies. The inability
10 of a health care provider to provide such access shall not
11 constitute a reason to deny an authorization request.
12 * * *
13 "Contractor." An insurer awarded a contract under section
14 2304-A to provide health care services. The term includes an
15 entity and an entity's subsidiary which is established under
16 this act, the act of December 29, 1972 (P.L.1701, No.364), known
17 as the Health Maintenance Organization Act or 40 Pa.C.S. Ch. 61
18 (relating to hospital plan corporation) or 63 (relating to
19 professional health services plan corporations).
20 * * *
21 "Drug formulary." A listing of [managed care plan] insurer,
22 MCO or contractor preferred therapeutic drugs.
23 * * *
24 "Enrollee." Any policyholder, subscriber, covered person or
25 other individual who is entitled to receive health care services
26 under a [managed care plan] health insurance policy, MCO
27 contract or CHIP contract.
28 "Grievance." As provided in subdivision (i), a request by an
29 enrollee or a health care provider, with the written consent of
30 the enrollee, to have [a managed care plan] an insurer, MCO,
20210SB0225PN2004 - 5 -
 1 contractor or utilization review entity reconsider a decision
2 solely concerning the medical necessity [and], appropriateness,
3 health care setting, level of care or effectiveness of a health
4 care service. If the [managed care plan] insurer, MCO or
5 contractor is unable to resolve the matter, a grievance may be
6 filed regarding the decision that:
7 (1) disapproves full or partial payment for a requested
8 health care service;
9 (2) approves the provision of a requested health care
10 service for a lesser scope or duration than requested; or
11 (3) disapproves payment for the provision of a requested
12 health care service but approves payment for the provision of an
13 alternative health care service.
14 The term does not include a complaint.
15 * * *
16 "Health care service." Any covered treatment, admission,
17 procedure, medical supplies and equipment or other services,
18 including behavioral health, prescribed or otherwise provided or
19 proposed to be provided by a health care provider to an enrollee
20 [under a managed care plan contract.]
21 "Health insurance policy." A policy, subscriber contract,
22 certificate or plan issued by an insurer that provides medical
23 or health care coverage. The term does not include any of the
24 following:
25 (1) An accident only policy.
26 (2) A credit only policy.
27 (3) A long-term care or disability income policy.
28 (4) A specified disease policy.
29 (5) A Medicare supplement policy.
30 (6) A TRICARE policy, including a Civilian Health and
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 1 Medical Program of the Uniformed Services (CHAMPUS) supplement
2 policy.
3 (7) A fixed indemnity policy.
4 (8) A hospital indemnity policy.
5 (9) A dental only policy.
6 (10) A vision only policy.
7 (11) A workers' compensation policy.
8 (12) An automobile medical payment policy.
9 (13) A homeowners' insurance policy.
10 (14) A short-term limited duration policy.
11 (15) Any other similar policy providing for limited
12 benefits.
13 "Inpatient admission." Admission to a facility for purposes
14 of receiving a health care service at the inpatient level of
15 care.
16 "Insurer." An entity licensed by the department to issue a
17 health insurance policy, subscriber contract, certificate or
18 plan that provides medical or health care coverage that is
19 offered or governed under any of the following:
20 (1) Article XXIV, section 630 or any other provision of this
21 act.
22 (2) A provision of 40 Pa.C.S. Ch. 61 or 63.
23 * * *
24 "MCO contract." The agreement between a medical assistance
25 managed care organization or MCO and the Department of Human
26 Services to provide for services to a Medicaid enrollee.
27 "Medical assistance managed care organization" or "MCO." A
28 Medicaid managed care organization as defined in section 1903(m)
29 (1)(A) of the Social Security Act (49 Stat. 620, 42 U.S.C. §
30 1396b(m)(1)(A)) that is a party to a Medicaid managed care
20210SB0225PN2004 - 7 -
 1 contract with the Department of Human Services. The term does
2 not include a behavioral health managed care organization that
3 is a party to a Medicaid managed care contract with the
4 Department of Human Services.
5 "Medical policy." A written document formally adopted,
6 maintained and applied by an insurer, MCO or contractor that
7 combines the clinical coverage criteria and any additional
8 administrative requirements, as applicable, necessary to
9 articulate the insurer's, MCO's or contractor's standards for
10 coverage of a given service or set of services under the terms
11 of a health insurance policy, MCO contract or CHIP contract.
12 "Medical or scientific evidence." Evidence found in any of
13 the following sources:
14 (1) A peer-reviewed scientific study published in or
15 accepted for publication by a medical journal that meets
16 nationally recognized requirements for scientific manuscripts
17 and which journal submits most of its published articles for
18 review by experts who are not part of the journal's editorial
19 staff.
20 (2) Peer-reviewed medical literature, including literature
21 relating to a therapy reviewed and approved by a qualified
22 institutional review board, biomedical compendia and other
23 medical literature that meet the criteria of the National
24 Institutes of Health's Library of Medicine for indexing in Index
25 Medicus (Medline) and Elsevier Science Limited for indexing in
26 Excerpta Medica (EMBASE).
27 (3) A medical journal recognized by the Secretary of Health
28 and Human Services under section 1861(t)(2) of the Social
29 Security Act (49 Stat. 620, 42 U.S.C. § 1395x(t)(2)).
30 (4) One of the following standard reference compendia:
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 1 (i) The American Hospital Formulary Service-Drug
2 Information.
3 (ii) Drug Facts and Comparison.
4 (iii) The American Dental Association Accepted Dental
5 Therapeutics.
6 (iv) The United States Pharmacopoeia-Drug Information.
7 (5) Findings, studies or research conducted by or under the
8 auspices of a Federal Government agency or nationally recognized
9 Federal research institute, including:
10 (i) The Federal Agency for Healthcare Research and Quality.
11 (ii) The National Institute of Health.
12 (iii) The National Cancer Institute.
13 (iv) The National Academy of Sciences.
14 (v) The Centers for Medicare and Medicaid Services.
15 (vi) The Food and Drug Administration.
16 (vii) Any national board recognized by the National
17 Institutes of Health for the purpose of evaluating the medical
18 value of health care services.
19 (6) Other medical or scientific evidence that is comparable
20 to the sources specified in paragraphs (1), (2), (3), (4) and
21 (5).
22 "Medication assisted treatment." United States Food and Drug
23 Administration approved prescription drugs used in combination
24 with counseling and behavioral health therapies in the treatment
25 of opioid use disorders.
26 "Nationally recognized medical standards." Clinical
27 criteria, practice guidelines and related standards established
28 by national quality and accreditation entities generally
29 recognized in the United States health care industry.
30 "Participating provider." A health care provider that has
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 1 entered into a contractual or operating relationship with an
2 insurer, MCO or contractor to participate in one or more
3 designated networks of the insurer, MCO or contractor and to
4 provide health care services to enrollees under the terms of the
5 insurer's, MCO's or contractor's administrative policy.
6 * * *
7 "Prior authorization." A review by an insurer, MCO,
8 contractor or by a utilization review entity acting on behalf of
9 an insurer, MCO or contractor of all reasonably necessary
10 supporting infor