0001| SENATE BILL 311
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0002| 43RD LEGISLATURE - STATE OF NEW MEXICO - SECOND SESSION, 1998
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0003| INTRODUCED BY
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0004| LINDA M. LOPEZ
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0006|
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0007|
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0008| FOR THE HEALTH AND WELFARE REFORM COMMITTEE
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0009|
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0010| AN ACT
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0011| RELATING TO HEALTH CARE; ENACTING THE MEDICAID MANAGED CARE
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0012| ACT; PROVIDING REQUIREMENTS FOR MEDICAID MANAGED HEALTH CARE
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0013| PLANS; IMPOSING A CIVIL PENALTY.
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0014|
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0015| BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:
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0016| Section 1. SHORT TITLE.--This act may be cited as the
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0017| "Medicaid Managed Care Act".
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0018| Section 2. DEFINITIONS.--As used in the Medicaid Managed
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0019| Care Act:
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0020| A. "department" means the human services
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0021| department;
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0022| B. "enrollee", "patient" or "consumer" means a
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0023| person who is entitled to receive health care benefits from a
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0024| managed health care plan;
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0025| C. "essential community provider" means a person
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0001| that provides a significant portion of its health or
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0002| health-related services to medically needy indigent patients,
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0003| including uninsured, underserved or special needs populations;
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0004| D. "health care facility" means an institution
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0005| providing health care services, including a hospital or other
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0006| licensed inpatient center, an ambulatory surgical or treatment
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0007| center, a skilled nursing center, a residential treatment
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0008| center, a home health agency, a diagnostic, laboratory or
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0009| imaging center and a rehabilitation or other therapeutic
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0010| health setting;
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0011| E. "health care insurer" means a person that has a
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0012| valid certificate of authority in good standing pursuant to
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0013| the New Mexico Insurance Code to act as an insurer, a health
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0014| maintenance organization, a nonprofit health care plan or a
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0015| prepaid dental plan;
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0016| F. "health care professional" means a physician or
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0017| other health care practitioner, including a pharmacist, who is
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0018| licensed, certified or otherwise authorized by the state to
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0019| provide health care services consistent with state law;
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0020| G. "health care provider" or "provider" means a
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0021| person that is licensed or otherwise authorized by the state
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0022| to furnish health care services and includes health care
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0023| professionals, health care facilities and essential community
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0024| providers;
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0025| H. "health care services" includes physical health
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0001| services or community-based mental health or developmental
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0002| disability services, including services for developmental
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0003| delay;
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0004| I. "managed health care plan" or "plan" means a
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0005| health benefit plan of a health care insurer or a provider
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0006| service network that either requires an enrollee to use, or
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0007| creates incentives, including financial incentives, for an
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0008| enrollee to use health care providers managed, owned, under
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0009| contract with or employed by the health care insurer.
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0010| "Managed health care plan" or "plan" does not include a
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0011| traditional fee-for-service indemnity plan or a plan that
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0012| covers only short-term travel, accident-only, limited benefit,
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0013| student health plan or specified disease policies;
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0014| J. "person" means an individual or other legal
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0015| entity;
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0016| K. "primary health care clinic" or "clinic" means
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0017| a nonprofit community-based entity established to provide the
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0018| first level of basic or general health care needs, including
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0019| diagnostic and treatment services, for residents of an
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0020| underserved health care area as defined in rules adopted by
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0021| the department of health; and
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0022| L. "provider service network" means two or more
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0023| health care providers affiliated for the purpose of providing
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0024| health care services to enrollees on a capitated or similar
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0025| prepaid, flat-rate basis.
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0001| Section 3. MEDICAID MANAGED HEALTH CARE PLAN OPERATIONS--
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0002| ENROLLMENT RESTRICTIONS--ADMINISTRATIVE ABUSES--PROFITS LIMITED.--
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0003| A. Except as otherwise provided in the Medicaid
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0004| Managed Care Act, the department shall monitor each managed health
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0005| care plan offered through the medicaid program and take all
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0006| reasonable steps necessary to ensure that each plan operates
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0007| fairly and efficiently, protects patient interests and fulfills
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0008| the plan's primary obligation to deliver high-quality health care
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0009| services. The department, in cooperation with the department of
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0010| health, shall be responsible for quality assurance and utilization
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0011| review oversight of medicaid managed health care plans.
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0012| B. No managed health care plan offered through the
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0013| medicaid program may directly recruit new members for enrollment
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0014| into the medicaid program. All enrollment of eligible persons
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0015| into the medicaid program shall be arranged directly by the
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0016| department.
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0017| C. The department, through its own offices and
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0018| employees, joint powers agreements with other state agencies or by
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0019| contract with one or more brokering agencies independent of any
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0020| managed health care provider, shall fully inform medicaid-eligible
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0021| persons of their choices for enrollment into a managed health care
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0022| plan. The department shall ensure that the enrollment process
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0023| includes adequate time and information for enrollees to make
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0024| informed choices about a plan. No plan offered through the
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0025| medicaid program shall enroll medicaid recipients into its managed
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0001| health care plan unless the enrollment is in accordance with
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0002| arrangements approved by the department.
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0003| D. The department shall regulate the marketing
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0004| activities of managed health care plans offered through the
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0005| medicaid program and prevent administrative abuses in the
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0006| operation of the plans.
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0007| E. A plan offered through the medicaid program shall
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0008| be required to maintain a medical loss ratio of at least ninety
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0009| percent, so that, at a minimum, ninety percent of all premium
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0010| dollars collected are paid for the direct provision of health care
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0011| services. The department of insurance shall adopt rules to define
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0012| the medical loss ratio consistent with the provisions of this
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0013| subsection.
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0014| Section 4. SPECIALIZED HEALTH CARE PROGRAMS--ESSENTIAL
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0015| COMMUNITY PROVIDERS.--Except as otherwise provided in the Medicaid
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0016| Managed Care Act, until January 1, 2000, no plan offered through
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0017| the medicaid program shall offer specialized behavioral or
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0018| developmental disability health services. The provisions of this
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0019| section apply to the specialized health care services needed for a
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0020| person treated for a developmental disability, a developmental
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0021| delay, a seriously disabling mental illness, a serious emotional
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0022| disturbance, physical or sexual abuse or neglect, substance abuse
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0023| or other behavioral health problem as defined in rules adopted by
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0024| the department of health. Those specialized behavioral or
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0025| developmental disability health services shall instead be
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0001| provided, until January 1, 2000, only by providers, including
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0002| essential community providers, that have been determined pursuant
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0003| to rules adopted by the department of health or the children,
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0004| youth and families department to be qualified to offer specialized
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0005| behavioral or developmental disability health services.
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0006| Section 5. HEALTH CARE PROVIDER PARTICIPATION.--A health
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0007| care provider that meets a medicaid managed health care plan's
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0008| reasonable qualification requirements and that is willing to
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0009| participate in the plan under its established reasonable terms and
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0010| conditions shall be allowed to participate in the plan.
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0011| Section 6. PRIMARY HEALTH CARE CLINICS PARTICIPATION.--
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0012| A. A plan offered through the medicaid program shall
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0013| be required to use under reasonable terms and conditions any
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0014| clinic that elects to participate in the plan, if the clinic meets
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0015| all reasonable quality-of-care and service payment requirements
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0016| imposed by the plan. The terms shall be no less favorable than
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0017| those offered any other provider, and they shall provide payments
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0018| that are reasonable and adequate to meet costs incurred by
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0019| efficiently and economically operated facilities, taking into
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0020| account the disproportionately greater severity of illness and
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0021| injury experienced by the patient population served.
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0022| B. A plan offered through the medicaid program may not
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0023| limit the number or location of primary health care clinics that
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0024| elect to participate in the plan.
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0025| C. In providing payments under the medicaid program,
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0001| the department shall ensure that a clinic that was or would have
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0002| qualified as a federally qualified health center in 1996 under the
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0003| federal Medicaid Act, as defined in 42 U.S.C. Section 1396d(l)(2),
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0004| shall receive one hundred percent reasonable cost-based
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0005| reimbursement for services, as was provided in the federal
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0006| Medicaid Act during 1996 for the centers pursuant to the
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0007| provisions of 42 U.S.C. Section 1396a(a)(13)(E).
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0008| D. In administering the medicaid program, the
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0009| department shall ensure that any program offering managed care
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0010| for participants, whether implemented through a federal waiver,
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0011| block grant or otherwise, shall require each plan to permit
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0012| contracting with each clinic in its service area that was or would
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0013| have qualified as a federally qualified health center in 1996
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0014| under the federal Medicaid Act, as defined in 42 U.S.C. Section
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0015| 1396d(l)(2), for delivery of covered services at terms no less
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0016| favorable than those offered to other providers in the plan for
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0017| equivalent services. The department shall provide timely payments
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0018| at least quarterly to federally qualified health centers to cover
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0019| the difference between their one hundred percent reasonable costs,
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0020| as was provided in the federal Medicaid Act during 1996 for the
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0021| centers pursuant to the provisions of 42 U.S.C. Section
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0022| 1396a(a)(13)(E), and the payments under medicaid managed care that
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0023| are received by the federally qualified health centers.
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0024| Section 7. INDIAN HEALTH SERVICE.--A Native American
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0025| enrolled in a managed health care plan offered through the
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0001| medicaid program shall retain the option of withdrawing
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0002| participation in that plan at any time and may receive services
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0003| directly from the Indian health service or health services
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0004| provided by tribes under the federal Indian Self-Determination and
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0005| Education Assistance Act, the federal urban Indian health program
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0006| or the federal Indian children's program. If an eligible Native
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0007| American chooses the option of receiving services directly from
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0008| the Indian health service or health services provided by tribes
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0009| under the federal Indian Self-Determination and Education
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0010| Assistance Act, the federal urban Indian health program or the
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0011| federal Indian children's program, the managed health care plan
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0012| shall ensure that the Indian health service receives the same
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0013| payment it would have received for the services rendered if the
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0014| patient did not participate in the plan.
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0015| Section 8. UNIVERSITY OF NEW MEXICO HEALTH SCIENCES
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0016| CENTER.--
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0017| A. A managed health care plan offered through the
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0018| medicaid program shall include participation by the university of
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0019| New Mexico health sciences center. The department shall
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0020| administer a program to ensure the participation includes delivery
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0021| of primary care and tertiary care services and to attempt to
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0022| ensure, to the extent permitted by federal law, that the medicaid
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0023| patient population served by the university of New Mexico health
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0024| sciences center remains at least at a level similar to that served
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0025| by the university of New Mexico health sciences center prior to
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0001| implementation of the medicaid managed health care program.
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0002| B. A plan offered through the medicaid program shall
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0003| provide payments to the university of New Mexico health sciences
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0004| center at rates that are reasonable and adequate to meet costs
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0005| incurred by efficiently and economically operated facilities,
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0006| taking into account the disproportionately greater severity of
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0007| illness and injury experienced by the patient population served.
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0008| C. The department shall administer a program and
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0009| cooperate with the university of New Mexico health sciences center
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0010| to ensure an adequate and diverse patient population necessary to
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0011| preserve the health sciences center's educational programs. The
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0012| department shall also ensure continuity of general support under
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0013| the state medicaid program to the university of New Mexico health
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0014| sciences center for medical education and for serving a
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0015| disproportionately large indigent patient population.
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0016| Section 9. PUBLIC NONPROFIT HOSPITALS.--
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0017| A. A plan offered through the medicaid program shall
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0018| be required to use under reasonable terms and conditions any
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0019| public nonprofit hospital that elects to participate in the plan,
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0020| if the hospital meets all reasonable quality-of-care and service
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0021| payment requirements imposed by the plan. The terms shall be no
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0022| less favorable than those offered by any other provider, and they
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0023| shall provide payments that are reasonable and adequate to meet
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0024| costs incurred by efficiently and economically operated
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0025| facilities, taking into account the disproportionately greater
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0001| severity of illness and injury experienced by the patient
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0002| population served.
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0003| B. A managed health care plan offered through the
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0004| medicaid program may not limit the number or location of public
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0005| nonprofit hospitals that elect to participate in the plan.
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0006| Section 10. LAS VEGAS MEDICAL CENTER.--A plan offered
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0007| through the medicaid program that offers mental health services
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0008| shall include participation by the Las Vegas medical center for
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0009| hospitalized care of mental health patients and other health care
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0010| services the center provides. A plan shall provide payments to
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0011| the Las Vegas medical center under reasonable terms and
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0012| conditions. For medicaid-eligible populations, the terms shall be
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0013| no less favorable than those offered any other provider, and they
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0014| shall provide payments that are reasonable and adequate to meet
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0015| costs incurred by efficiently and economically operated
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0016| facilities, taking into account the disproportionately greater
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0017| severity of illness and injury experienced by the patient
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0018| population served.
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0019| Section 11. AUTHORIZATION FOR MEDICAID MANAGED CARE
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0020| CONTRACTS DIRECTLY WITH PUBLIC AGENCIES, HOSPITALS, ESSENTIAL
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0021| COMMUNITY PROVIDERS AND PROVIDER SERVICE NETWORKS.--In
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0022| administering the medicaid program or a managed health care plan
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0023| for the program, the department may contract directly with a
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0024| government agency or public body, public nonprofit hospital, the
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0025| university of New Mexico health sciences center, an essential
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0001| community provider or a provider service network. In doing so,
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0002| the department is not required to contract with any such entity
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0003| only through arrangements with a health care insurer.
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0004| Section 12. ENFORCEMENT OF THE MEDICAID MANAGED CARE
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0005| ACT.--
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0006| A. The department or a person who suffers a loss as a
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0007| result of a violation of a provision in the Medicaid Managed Care
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0008| Act may bring an action to recover actual damages or the sum of
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0009| one hundred dollars ($100), whichever is greater. When the trier
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0010| of fact finds that the party charged with the violation acted
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0011| willfully, the court may award up to three times actual damages or
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0012| three hundred dollars ($300), whichever is greater, to the party
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0013| complaining of the violation.
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0014| B. A person likely to be damaged by a denial of a
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0015| right protected in the Medicaid Managed Care Act may be granted an
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0016| injunction under the principles of equity and on terms that the
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0017| court considers reasonable. Proof of monetary damage or intent to
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0018| violate a right is not required.
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0019| C. To protect and enforce an enrollee's or a health
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0020| care provider's rights in a plan offered through the medicaid
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0021| program, an enrollee and a health care provider participating in
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0022| or eligible to participate in a medicaid managed health care plan
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0023| shall each be treated as a third party beneficiary of the managed
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0024| health care plan contract between the health care insurer and the
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0025| party with which the insurer directly contracts. An enrollee or a
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0001| health care provider may sue to enforce the rights provided in the
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0002| contract that governs the managed health care plan.
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0003| D. The court shall award attorney fees and costs to
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0004| the party complaining of a violation of a right protected in the
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0005| Medicaid Managed Care Act if the party prevails substantially in
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0006| the lawsuit.
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0007| E. The relief provided in this section is in addition
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0008| to other remedies available against the same conduct under the
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0009| common law or other statutes of this state.
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0010| F. In a class action filed under this section, the
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0011| court may award damages to the named plaintiffs as provided in
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0012| this section and may award members of the class the actual damages
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0013| suffered by each member of the class as a result of the unlawful
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0014| practice.
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0015| G. A person shall not be required to complete
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0016| available grievance procedures or exhaust administrative remedies
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0017| prior to seeking relief in court regarding a complaint that may be
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0018| filed under this section.
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0019| Section 13. PENALTY.--In addition to other penalties
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0020| provided by law, the secretary of human services may impose a
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0021| civil administrative penalty of up to twenty-five thousand dollars
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0022| ($25,000) for each violation of the Medicaid Managed Care Act. An
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0023| administrative penalty shall be imposed by written order of the
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0024| secretary after holding a hearing as provided for in the Public
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0025| Assistance Appeals Act.
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0001| Section 14. RULES.--The department may adopt rules it deems
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0002| necessary or appropriate to administer the provisions of the
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0003| Medicaid Managed Care Act.
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0004| Section 15. EFFECTIVE DATE.--The effective date of the
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0005| provisions of this act is July 1, 1998.
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0006|
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