2021 -- S 0379

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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2021

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A N   A C T

RELATING TO HUMAN SERVICES -- MEDICAL ASSISTANCE

     

     Introduced By: Senators Mack, Calkin, Mendes, Anderson, Acosta, Bell, Euer, Valverde,
DiMario, and Miller

     Date Introduced: February 25, 2021

     Referred To: Senate Health & Human Services

     It is enacted by the General Assembly as follows:

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     SECTION 1. Legislative findings.

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     The general assembly finds and declares the following:

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     (1) Medicaid covers approximately 1 in 4 Rhode Islanders, including 1 in 5 adults, 3 in 8

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children, 3 in 5 nursing home residents, 3 in 5 individuals with disabilities, and 4 in 9 individuals

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with disabilities and 1 in 5 Medicare beneficiaries;

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     (2) COVID-19 has made proper funding and management of the Rhode Island Medicaid

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programs even more necessary and urgent;

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     (3) Prior to 1994, Rhode Island managed its own Medicaid programs reimbursing health

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care providers directly;

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     (4) Since 1994, Rhode Island has privatized an ever-growing portion of its Medicaid

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program so that by 2019, 91% of all RI Medicaid recipients are in a managed care program, i.e.,

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283,033 Medicaid eligible individuals and managed care organization (MCO) payments comprise

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60 percent of Medicaid benefit expenditures (i.e., about $1.7 billion);

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     (5) In annual reports since 2009, the Rhode Island Office of the Auditor General has

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repeatedly found that the state lacks adequate oversight of such private health insurance companies;

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     (6) In 2015, the Auditor General found that Rhode Island overpaid more than two hundred

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million dollars ($200,000,000) to private health insurance companies and could not recoup

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overpayments until 2017, due to opposition from such companies;

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     (7) Significant research has found that privatizing management of Medicaid does not save

 

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states money and often costs them more;

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     (8) In 2009, Connecticut conducted an audit which found that it was overpaying private

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health insurance companies (United Healthcare Group, Aetna, and Community Health Network of

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Connecticut) nearly fifty million dollars ($50,000,000) of Medicaid funds per year;

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     (9) In 2012, Connecticut abandoned its attempt to privatize management of its Medicaid

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program and subsequently saved hundreds of millions of dollars and achieved the lowest Medicaid

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cost increases in the country and improved access to care;

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     (10) Rhode Island's major efforts to "reinvent Medicaid" focused on privatizing Medicaid,

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including hiring private corporations to implement UHIP/RIBridges as well as act as MCOs and

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have not resulted in comparable savings;

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     (11) Other states, such as Iowa and Kansas, have recently privatized Medicaid by hiring

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MCOs and "have suffered cuts in care, reduced far less costs than expected, and sacrificed oversight

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and transparency by handing their programs over to private entities," and "these changes have been

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devastating for many Medicaid recipients that once could depend on public provision for life-

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sustaining care";

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     (12) After finding insufficient oversight of MCOs since 2009, the RI Auditor General in

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the FY 2017, FY 2018, and FY 2019 Single Audit Reports bluntly concludes, "The State lacks

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effective auditing and monitoring of MCO financial activity."

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     SECTION 2. Chapter 40-8 of the General Laws entitled "Medical Assistance" is hereby

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amended by adding thereto the following section:

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     40-8-33. Medicaid programs audit, assessment and improvement.

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     (a) The auditor general shall conduct and oversee an audit of the state's Medicaid programs

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currently administered by managed care organizations (MCOs). The purpose of the audit is to

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determine whether significant savings and/or improved access to Medicaid-related health care

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services may be accomplished, and the determination is to include, but not be limited to, savings

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and/or improved access resulting from the end of privatized management of Medicaid by MCOs.

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The audit shall include a review of all the matters audited by the state of Connecticut Comptroller

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in that state's review of MCOs in 2009.

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     (b) The auditor general shall report the findings of the audit by November 1, 2021, to the

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general assembly and to the director of the executive office of health and human services. The

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auditor general may include in the report any recommendations for cost savings or improvements

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in the delivery of Medicaid-related health care services to include, but not be limited to, ending

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privatized management of Medicaid.

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     (c) If the audit demonstrates or establishes that reversing privatized management of

 

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Medicaid by MCOs will result in savings and/or better access to health care, the director of the

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executive office of health and human services (EOHHS) shall develop a plan for the state to end

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the practice of contracting with insurance companies and to transition to state management within

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three (3) years or less from the effective date of this section if approved by the general assembly.

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The plan shall be submitted to the general assembly by January 1, 2022.

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     SECTION 3. This act shall take effect upon passage.

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N   A C T

RELATING TO HUMAN SERVICES -- MEDICAL ASSISTANCE

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     This act would require the auditor general to conduct an audit of Medicaid programs

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administered by MCOs. The auditor general would report findings to the general assembly and the

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director of the executive office of health and human services (EOHHS) by November 1, 2021. The

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director of EOHHS would provide the general assembly with a plan to end privatized management

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of Medicaid by January 1, 2022, if the audit demonstrates the plan would result in savings and/or

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better access to health care.

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     This act would take effect upon passage.

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