44TH LEGISLATURE - STATE OF NEW MEXICO - FIRST SESSION, 1999

RELATING TO HEALTH; PROVIDING FOR LIABILITY OF MANAGED CARE HEALTH PLANS; AMENDING THE PATIENT PROTECTION ACT; AMENDING AND ENACTING SECTIONS OF THE NMSA 1978.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:

Section 1. Section 59A-57-1 NMSA 1978 (being Laws 1998, Chapter 107, Section 1) is amended to read:

"59A-57-1. SHORT TITLE.--[Sections 1 through 11 of this act] Chapter 59A, Article 57 NMSA 1978 may be cited as the "Patient Protection Act"."

Section 2. A new Section of Chapter 59A, Article 57 NMSA 1978 is enacted to read:

"[NEW MATERIAL] HEALTH CARE LIABILITY.--

A. A plan has the duty to exercise ordinary care when making health care treatment decisions and is liable for damages for harm to an enrollee proximately caused by the plan's failure to exercise such ordinary care.

B. A plan is liable for damages for harm to an enrollee proximately caused by the health care treatment decisions made by its:

(1) employees;

(2) agents;

(3) apparent agents; or

(4) representatives who are acting on its behalf and over whom it has the right to exercise influence or control or has actually exercised influence or control that results in the failure to exercise ordinary care.

C. It is a defense to an action asserted against a plan that:

(1) neither the plan nor an employee, agent, apparent agent or representative for whose conduct the plan is liable pursuant to Subsection B of this section, controlled, influenced or participated in the health care treatment decision; and

(2) the plan did not deny or delay payment for any treatment prescribed or recommended by a provider to the enrollee.

D. The standards in Subsections A and B of this section create no obligation on the part of the plan to provide to an enrollee treatment that is not covered by the plan.

E. This section does not create liability of an employer, an employer group purchasing organization or a pharmacy licensed by the board of pharmacy that purchases coverage or assumes risk on behalf of its employees.

F. A plan may not remove a health care provider from its plan or refuse to renew the health care provider's participation in its plan for advocating for appropriate and medically necessary health care for an enrollee.

G. A plan may not enter into a contract with a health care provider or pharmaceutical company that includes an indemnification or hold harmless clause for the acts or conduct of the plan.

H. In an action against a plan, a finding that a health care provider is an employee, agent, apparent agent or representative of the plan shall not be based solely on proof that the person's name appears in a listing of approved health care providers made available to enrollees under a plan.

I. No civil action against a plan may be brought pursuant to this section unless the affected enrollee or the enrollee's representative:

(1) has exhausted the administrative appeals and review remedies available pursuant to the Patient Protection Act; and

(2) before instituting the action:

(a) gives written notice of the claim as provided by Subsection J of this section; and

(b) agrees to submit the claim to a review by the department as required by Subsection K of this section.

J. The notice required by Paragraph (2) of Subsection I of this section must be delivered or mailed to the plan against whom the action is brought not later than the thirtieth day before the date the civil action is filed.

K. The enrollee or the enrollee's representative must submit the claim to a review by the department if the plan against whom the claim is made requests the review not later than the fourteenth day after the date the notice pursuant to Subparagraph (a) of Paragraph (2) of Subsection I of this section is received by the plan entity. If the plan does not request the review within the period specified by this subsection, the enrollee or the enrollee's representative is not required to submit the claim to the department.

L. Subject to Subsection M of this section, if the enrollee has not complied with Subsection I of this section, an action pursuant to this section shall not be dismissed by the court, but the court may, in its discretion, order the parties to submit to an independent review or mediation or other non-binding alternative dispute resolution and may abate the action for a period of not to exceed thirty days for those purposes. Such an order of the court is the sole remedy available to a party complaining of an enrollee's failure to comply with Subsection I of this section.

M. An enrollee is not required to comply with Subsection K of this section, and no abatement or other order pursuant to Subsection L of this section for failure to comply shall be imposed if the enrollee has filed a pleading alleging in substance that:

(1) harm to the enrollee has already occurred because of the conduct of the plan or because of an act or omission of an employee, agent, apparent agent or representative of the plan for whose conduct it is liable pursuant to this section; and

(2) the review would not be beneficial to the enrollee, unless the court, upon motion by a defendant plan, finds after hearing that the pleading was not made in good faith in which case the court may enter an order pursuant to Subsection L of this section.

O. If the enrollee or the enrollee's representative seeks to exhaust the administrative appeals and review available pursuant to the Patient Protection Act or provides notice, as required by Subsection I of this section, before the statute of limitations applicable to a claim against a plan has expired, the limitations period is tolled until the later of:

(1) the thirtieth day after the date the enrollee or the enrollee's representative has exhausted the process for administrative appeals and review pursuant to the Patient Protection Act; or

(2) the fortieth day after the date the enrollee or enrollee's representative gives notice pursuant to Subparagraph (a) of Paragraph (2) of Subsection I of this section.

P. This section does not prohibit an enrollee from pursuing other appropriate remedies, including injunctive relief, a declaratory judgment or relief under law if the requirement of exhausting the administrative process for appeal and review places the enrollee's health in serious jeopardy."