2026 -- S 2573

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LC004685

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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2026

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A N   A C T

RELATING TO HEALTH AND SAFETY -- THE RHODE ISLAND COMPREHENSIVE

HEALTH INSURANCE PROGRAM

     Introduced By: Senators Bell, Ujifusa, Valverde, Kallman, Murray, and Mack

     Date Introduced: February 13, 2026

     Referred To: Senate Health & Human Services

     It is enacted by the General Assembly as follows:

     SECTION 1. Title 23 of the General Laws entitled "HEALTH AND SAFETY" is hereby

amended by adding thereto the following chapter:

CHAPTER 106

THE RHODE ISLAND COMPREHENSIVE HEALTH INSURANCE PROGRAM

     23-106-1. Legislative findings.

     The general assembly hereby finds and declares as follows:

     (1) Health care is a human right, not a commodity available only to those who can afford

it;

     (2) Although the federal Affordable Care Act (“ACA”) allowed states to offer more people

taxpayer subsidized private health insurance, the ACA has not provided universal, comprehensive,

affordable coverage for all Rhode Islanders:

     (i) In 2019, about four and three-tenths percent (4.3%) of Rhode Islanders had no health

insurance, causing about forty-three (43) (1 per 1,000 uninsured) unnecessary deaths each year;

     (ii) An estimated forty-five percent (45%) of Rhode Islanders are underinsured (e.g., not

seeking health care because of high deductibles and co-pays);

     (3) COVID-19 exacerbated and highlighted problems with the status quo health insurance

system including:

     (i) Coverage is too easily lost when health insurance is tied to jobs - between February and

May, 2020, about twenty-one thousand (21,000) more Rhode Islanders lost their jobs and their

health insurance;

     (ii) Systemic racism is reinforced - Black and Hispanic/Latinx Rhode Islanders, who are

more likely to be uninsured or underinsured, have suffered the highest rates of COVID-19 mortality

and morbidity;

     (iii) The fear of out-of-pocket costs for uninsured and underinsured puts everyone at risk

because they avoid testing and treatment;

     (4) In 2016, sixty million (60,000,000) people separated from their job at some point during

the year (i.e., about forty-two percent (42%) of the American workforce) and although this chapter

may cause some job loss, on balance, a single-payer would increase employment in Rhode Island

by nearly three percent (3%);

     (5) The existing US health insurance system has failed to control the cost of health care

and to provide universal access to health care in a system which is widely accepted to waste thirty

percent (30%) of its revenues on activities that do not improve the health of Americans;

     (6) Every industrialized nation in the world, except the United States, offers universal

health care to its citizens and enjoys better health outcomes for less than two thirds (2/3) to one-

half (1/2) the cost;

     (7) Health care is rationed under our current multi-payer system, despite the fact that Rhode

Island patients, businesses and taxpayers already pay enough to have comprehensive and universal

health insurance under a single-payer system;

     (8) About one-third (1/3) of every "healthcare" dollar spent in the U.S. is wasted on

unnecessary administrative costs and excessive pharmaceutical company profits due to laws

preventing Medicare from negotiating prices and private health insurance companies lacking

adequate market share to effectively negotiate prices;

     (9) Private health insurance companies are incentivized to let the cost of health care rise

because higher costs require health insurance companies to charge higher health insurance

premiums, increasing companies' revenue and stock price;

     (10) The healthcare marketplace is not an efficient market and because it represents only

eighteen percent (18%) of the US domestic market, significantly restricts economic growth and

thus the financial well-being of every American, including every Rhode Islander;

     (11) Rhode Islanders cannot afford to keep the current multi-payer health insurance system:

     (i) Between 1991 and 2014, healthcare spending in Rhode Island per person rose by over

two hundred fifty percent (250%) rising much faster than income and greatly reducing disposable

income;

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     (ii) It was estimated that by 2025, the cost of health insurance for an average family of four

(4) will equal about one-half (1/2) of their annual income;

     (iii) In the U.S., about two-thirds (2/3) of personal bankruptcies are medical cost-related

and of these, about three-fourths (3/4) had health insurance at the onset of their medical problems.

In no other industrialized country do people worry about going bankrupt over medical costs;

     (12) Rhode Island private businesses bear most of the costs of employee health insurance

coverage and spend significant time and money choosing from a confusing array of increasingly

expensive plans which do not provide comprehensive coverage;

     (13) Rhode Island employees and retirees lose significant wages and pensions as they are

forced to pay higher amounts of health insurance and healthcare costs;

     (14) Rhode Island's hospitals are under increasing financial distress i.e., closing, sold to

out-of-state entities, attempting mergers largely due to health insurance reimbursement problems

that other nations do not face and are fixed by a single-payer system;

     (15) The state and its municipalities face enormous other post-employment benefits

(OPEB) unfunded liabilities due mostly to health insurance costs;

     (16) An improved Medicare-for-all style single-payer program would, based on the

performance of existing Medicare, eliminate fifty percent (50%) of the administrative waste in the

current system of private insurance before other savings achieved through meaningful negotiation

of prices and other savings are considered;

     (17) The high costs of medical care could be lowered significantly if the state could

negotiate on behalf of all its residents for bulk purchasing, as well as gain access to usage and price

information currently kept confidential by private health insurers as "proprietary information;"

     (18) Single-payer healthcare would establish a true "free market" system where doctors

compete for patients rather than health insurance companies dictating which patients are able to see

which doctors and setting reimbursement rates;

     (19) Healthcare providers would spend significantly less time with administrative work

caused by multiple health insurance company requirements and barriers to care delivery and would

spend significantly less for overhead costs because of streamlined billing;

     (20) Rhode Island must act because there are currently no effective state or federal laws

that can provide universal coverage and adequately control rising premiums, co-pays, deductibles

and medical costs, or prevent private insurance companies from continuing to limit available

providers and coverage;

     (21) In 1962, Canada's successful single-payer program began in the province of

Saskatchewan (with approximately the same population as Rhode Island) and became a national

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program within ten (10) years; and

     (v) The proposed Rhode Island single-payer program was studied by Professor Gerald

Friedman at UMass Amherst in 2015 and he concluded that:

     "Single-payer in Rhode Island will finance medical care with substantial savings compared

with the existing multi-payer system of public and private insurers and would improve access to

health care by extending coverage to the four percent (4%) of Rhode Island residents still without

insurance under the Affordable Care Act and expanding coverage for the growing number with

inadequate healthcare coverage. Single-payer would improve the economic health of Rhode Island

by: increasing real disposable income for most residents; reducing the burden of health care on

businesses and promoting increased employment; and shifting the costs of health care away from

working and middle-class residents".

     23-106-2. Legislative purpose.

     It is the intent of the general assembly that this chapter establish a universal,

comprehensive, affordable single-payer healthcare insurance program that will help control

healthcare costs which shall be referred to as, "the Rhode Island comprehensive health insurance

program" (“RICHIP”). The program will be paid for by consolidating government and private

payments to multiple insurance carriers into a more economical and efficient improved Medicare-

for-all style single-payer program and substituting lower progressive taxes for higher health

insurance premiums, co-pays, deductibles and costs in excess of caps. This program will save

Rhode Islanders from the current overly expensive, inefficient and unsustainable multi-payer health

insurance system that unnecessarily prevents access to medically necessary health care. The

program will be established after the standard of care funded by Medicaid has been raised to a

Medicare standard.

     23-106-3. Definitions.

     As used in this chapter:

     (1) "Affordable Care Act" or "ACA" means the Federal Patient Protection and Affordable

Care Act (Pub. L. 111-148), as amended by the Federal Health Care and Education Reconciliation

Act of 2010 (Pub. L. 111-152), and any amendments to, or regulations or guidance issued under,

those acts.

     (2) "Carrier" means either a private health insurer authorized to sell health insurance in

Rhode Island or a healthcare service plan, i.e., any person who undertakes to arrange for the

provision of healthcare services to subscribers or enrollees, or to pay for or to reimburse any part

of the cost for those services, in return for a prepaid or periodic charge paid by or on behalf of the

subscribers or enrollees, or any person, whether located within or outside of this state, who solicits

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or contracts with a subscriber or enrollee in this state to pay for or reimburse any part of the cost

of, or who undertakes to arrange or arranges for, the provision of healthcare services that are to be

provided, wholly or in part, in a foreign country in return for a prepaid or periodic charge paid by

or on behalf of the subscriber or enrollee.

     (3) "Dependent" has the same definition as set forth in federal tax law (26 U.S.C. § 152).

     (4) "Emergency and urgently needed services" has the same definition as set forth in the

federal Medicare law (42 CFR 422.113).

     (5) "Federally matched public health program" means the state's Medicaid program under

Title XIX of the Social Security Act (42 U.S.C. § 1396 et seq.) and the state's Children's Health

Insurance Program (CHIP) under Title XXI of the Social Security Act (42 U.S.C. § 1397aa et seq.).

     (6) "For-profit provider" means any healthcare professional or healthcare institution that

provides payments, profits or dividends to investors or owners who do not directly provide health

care.

     (7) "Health insurance company" means any entity subject to the insurance laws and

regulations of this state, or subject to the jurisdiction of the health insurance commissioner, that

contracts or offers to contract, to provide and/or insuring health services on a prepaid basis

including, but not limited to, policies of accident and sickness insurance, as defined by chapter 18

of title 27, nonprofit hospital service corporation as defined by chapter 19 of title 27, and nonprofit

medical service corporation as defined in chapter 20 of title 27, a health maintenance organizations,

as defined in chapter 41 of title 27 and also includes a nonprofit dental service corporation, as

defined in chapter 20.1 of title 27, all nonprofit optometric service corporations, as defined in

chapter 20.2 of title 27, a domestic insurance company subject to chapter 1 of title 27 that offers or

provides health insurance coverage in the state, and a foreign insurance company, subject to chapter

2 of title 27, all pharmacy benefit managers (“PBMs”) that contracts to administer or manage

prescription drug benefits, any plan preempted by ERISA, but subject to state control (specifically

state government, local government, and quasi-public agency ERISA plans).

     (8) "Medicaid" or "medical assistance" means a program that is one of the following:

     (i) The state's Medicaid program under Title XIX of the Social Security Act (42 U.S.C. §

1396 et seq.); or

     (ii) The state's Children's Health Insurance Program under Title XXI of the Social Security

Act (42 U.S.C. § 1397aa et seq.).

     (9) "Medically necessary" means medical, surgical or other services or goods (including

prescription drugs) required for the prevention, diagnosis, cure, or treatment of a health-related

condition including any such services that are necessary to prevent a detrimental change in either

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medical or mental health status. Medically necessary services shall be provided in a cost-effective

and appropriate setting and shall not be provided solely for the convenience of the patient or service

provider. "Medically necessary" does not include services or goods that are primarily for cosmetic

purposes; and does not include services or goods that are experimental, unless approved pursuant

to § 23-106-6(b).

     (10) "Medicare" means Title XVIII of the Social Security Act (42 U.S.C. § 1395 et seq.)

and the programs thereunder.

     (11) "Qualified healthcare provider" means any individual who meets requirements set

forth in § 23-106-7(a)(1).

     (12) "Qualified Rhode Island resident" means any individual who is a "resident" as defined

by §§ 44-30-5(a)(1) and (a)(2) or a dependent of that resident.

     (13) "Rhode Island comprehensive health insurance program" or ("RICHIP") means the

affordable, comprehensive and effective health insurance program as set forth in this chapter.

     (14) "RICHIP participant" means a qualified Rhode Island resident who is enrolled in

RICHIP (and not disenrolled or disqualified) at the time they seek health care.

     (15) “State-owned health insurance company” means a health insurance company owned

by RICHIP.

     23-106-4. Rhode Island comprehensive health insurance program.

     (a) Organization. This chapter creates the Rhode Island comprehensive health insurance

program (“RICHIP”) as an independent state government agency.

     (b) Board. There shall be a RICHIP board composed of nine (9) members serving terms of

four (4) years. Members shall be appointed by the governor with the advice and consent of the

senate.

     (c) Director. A director shall be appointed by the governor, with the advice and consent of

the senate, to lead RICHIP and serve a term of four (4) years, subject to oversight by an executive

board. The director shall be compensated in accordance with the job title and job classification

established by the division of human resources and approved by the general assembly.

     (d) Phase one. The board shall have the power to acquire or launch a health insurance

company, which shall be managed by the board. Such an acquisition will initiate phase one.

     (1) The state-owned health insurance company shall be exempt from any reserve

requirements.

     (2) The State of Rhode Island shall be responsible for funding any costs of the state-owned

health insurance company that may exceed the available reserves.

     (3) The director shall be responsible for daily management of the state-owned health

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insurance company, and the duties, powers, and responsibilities of the director shall be determined

by the board.

     (4) The state-owned health insurance company shall not be exempt from taxation.

     (e) Phase two. The board shall vote to initiate phase two. In phase two, the state-owned

health insurance company and federal healthcare programs such as Medicare and Medicaid shall

be merged into a comprehensive program, RICHIP, which shall aim to cover all residents of the

State of Rhode Island.

     (1) Under phase two, the duties of the director shall include:

     (i) Employ staff and authorize reasonable expenditures, as necessary, from the RICHIP

trust fund, to pay program expenses and to administer the program, including creation and oversight

of RICHIP budgets;

     (ii) Oversee management of the RICHIP trust fund set forth in § 23-106-11(a) to ensure

the operational well-being and fiscal solvency of the program, including ensuring that all available

funds from all appropriate sources are collected and placed into the trust fund;

     (iii) Take any actions necessary and proper to implement the provisions of this chapter;

     (iv) Implement standardized claims and reporting procedures;

     (v) Provide for timely payments to participating providers through a structure that is well

organized and that eliminates unnecessary administrative costs, i.e., coordinate with the state

comptroller to facilitate billing from and payments to providers using the state's computerized

financial system, the Rhode Island financial and accounting network system (“RIFANS”);

     (vi) Coordinate with federal healthcare programs, including Medicare and Medicaid, to

obtain necessary waivers and streamline federal funding and reimbursement;

     (vii) Monitor billing and reimbursements to detect inappropriate behavior by providers and

patients and create prohibitions and penalties regarding bad faith or criminal RICHIP participation,

and procedures by which they will be enforced;

     (viii) Support the development of an integrated healthcare database for healthcare planning

and quality assurance and ensure the legally required confidentiality of all health records it

contains;

     (ix) Determine eligibility for RICHIP and establish procedures for enrollment,

disenrollment and disqualification from RICHIP, as well as procedures for handling complaints

and appeals from affected individuals, as set forth in § 29-106-5;

     (x) Create RICHIP expenditure, status, and assessment reports including, but not limited

to, annual reports with the following:

     (A) Performance of the program;

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     (B) Fiscal condition of the program;

     (C) Recommendations for statutory changes;

     (D) Receipt of payments from the federal government;

     (E) Whether current year goals and priorities were met; and

     (F) Future goals and priorities;

     (xi) Review RICHIP collections and disbursements on at least a quarterly basis and

recommend adjustments needed to achieve budgetary targets and permit adequate access to care;

     (xii) Develop procedures for accommodating:

     (A) Employer retiree health benefits for people who have been members of RICHIP but

leave to live as retirees out of the state;

     (B) Employer retiree health benefits for people who earned or accrued those benefits while

residing in the state prior to the implementation of RICHIP and live as retirees out of the state; and

     (C) RICHIP coverage of healthcare services currently covered under the workers'

compensation system, including whether and how to continue funding for those services under that

system and whether and how to incorporate an element of experience rating; and

     (xiii) No later than two (2) years after the initiation of phase two, develop a proposal,

consistent with the principles of this chapter, for provision and funding by the program of long-

term care coverage.

     (2) Under phase two, the duties of the board shall include:

     (i) Annually establish a RICHIP benefits package for participants, including a formulary

and a list of other medically necessary goods, as well as a procedure for handling complaints and

appeals relating to the benefits package, pursuant to § 23-106-6.

     (ii) Establish RICHIP provider reimbursement and a procedure for handling provider

complaints and appeals as set forth in § 23-106-9;

     (iii) Review budget proposals from providers pursuant to § 23-106-11(b); and

     (iv) The board shall be subject to chapter 46 of title 42 ("open meetings").

     23-106-5. Coverage.

     (a) All qualified Rhode Island residents may participate in RICHIP. The director shall

establish procedures to determine eligibility, enrollment, disenrollment and disqualification,

including criteria and procedures by which RICHIP can:

     (1) Identify, automatically enroll, and provide a RICHIP card to qualified Rhode Island

residents;

     (2) Process applications from individuals seeking to obtain RICHIP coverage for

dependents after the implementation date;

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     (3) Ensure eligible residents are knowledgeable and aware of their rights to health care;

     (4) Determine whether an individual should be disenrolled (e.g., for leaving the state);

     (5) Determine whether an individual should be disqualified (e.g., for fraudulent receipt of

benefits or reimbursements);

     (6) Determine appropriate actions that should be taken with respect to individuals who are

disenrolled or disqualified (including civil and criminal penalties); and

     (7) Permit individuals to request review and appeal decisions to disenroll or disqualify

them.

     (b) Medicare and Medicaid eligible coverage under RICHIP shall be as follows:

     (1) If all necessary federal waivers are obtained, qualified Rhode Island residents eligible

for federal Medicare ("Medicare eligible residents") shall continue to pay required fees to the

federal government. RICHIP shall establish procedures to ensure that Medicare eligible residents

shall have such amounts deducted from what they owe to RICHIP under § 23-106-12(h). RICHIP

shall become the equivalent of qualifying coverage under Medicare part D and Medicare advantage

programs, and as such shall be the vendor for coverage to RICHIP participants. RICHIP shall

provide Medicare eligible residents benefits equal to those available to all other RICHIP

participants and equal to or greater than those available through the federal Medicare program. To

streamline the process, RICHIP shall seek to receive federal reimbursements for services and goods

to Medicare eligible residents and administer all Medicare funds.

     (2) If all necessary federal waivers are obtained, RICHIP shall become the state's sole

Medicaid provider. RICHIP shall create procedures to enroll all qualified Rhode Island residents

eligible for Medicaid ("Medicaid eligible residents") in the federal Medicaid program to ensure a

maximum amount of federal Medicaid funds go to the RICHIP trust fund. RICHIP shall provide

benefits to Medicaid eligible residents equal to those available to all other RICHIP participants.

     (3) If all necessary federal waivers are not granted from the Medicaid or Medicare

programs operated under Title XVIII or XIX of the Social Security Act, the Medicaid or Medicare

program for which a waiver is not granted shall act as the primary insurer for those eligible for such

coverage, and RICHIP shall serve as the secondary or supplemental plan of health insurance

coverage. Until such time as a waiver is granted, the plan shall not pay for services for persons

otherwise eligible for the same healthcare benefits under the Medicaid or Medicare program. The

director shall establish procedures for determining amounts owed by Medicare and Medicaid

eligible residents for supplemental RICHIP coverage and the extent of such coverage.

     (4) The director may require Rhode Island residents to provide information necessary to

determine whether the resident is eligible for a federally matched public health program or for

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Medicare, or any program or benefit under Medicare.

     (5) As a condition of eligibility or continued eligibility for healthcare services under

RICHIP, a qualified Rhode Island resident who is eligible for benefits under Medicare shall enroll

in Medicare, including Parts A, B, and D.

     (c) Veterans. RICHIP shall serve as the secondary or supplemental plan of health insurance

coverage for military veterans. The director shall establish procedures for determining amounts

owed by military veterans who are qualified residents for such supplemental RICHIP coverage and

the extent of such coverage.

     (d) This chapter does not create any employment benefit, nor require, prohibit, or limit the

providing of any employment benefit.

     (e) This chapter does not affect or limit collective action or collective bargaining on the

part of a healthcare provider with their employer or any other lawful collective action or collective

bargaining.

     (f) This section shall take effect when the RICHIP board votes to initiate phase two.

     23-106-6. Benefits.

     (a) This chapter shall provide insurance coverage for services and goods (including

prescription drugs) deemed medically necessary by a qualified healthcare provider and that is

currently covered under:

     (1) Services and goods currently covered by the federal Medicare program (Social Security

Act title XVIII) parts A, B and D;

     (2) Services and goods covered by Medicaid as of January 1, 2027;

     (3) Services and goods currently covered by the state's Children's Health Insurance

Program;

     (4) Essential health benefits mandated by the Affordable Care Act; and

     (5) Services and goods within the following categories:

     (i) Primary and preventive care;

     (ii) Approved dietary and nutritional therapies;

     (iii) Inpatient care;

     (iv) Outpatient care;

     (v) Emergency and urgently needed care;

     (vi) Prescription drugs and medical devices;

     (vii) Laboratory and diagnostic services;

     (viii) Palliative care;

     (ix) Mental health services;

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     (x) Oral health, including dental services, periodontics, oral surgery, and endodontics;

     (xi) Substance abuse treatment services;

     (xii) Physical therapy and chiropractic services;

     (xiii) Vision care and vision correction;

     (xiv) Hearing services, including coverage of hearing aids;

     (xv) Podiatric care;

     (xvi) Comprehensive family planning, reproductive, maternity, and newborn care;

     (xvii) Short-term rehabilitative services and devices;

     (xviii) Durable medical equipment;

     (xix) Gender affirming health care; and

     (xx) Diagnostic and routine medical testing.

     (b) Additional coverage. The director shall create a procedure that may permit additional

medically necessary goods and services beyond that provided by federal laws cited herein and

within the areas set forth in § 23-106-4, if the coverage is for services and goods deemed medically

necessary based on credible scientific evidence published in peer-reviewed medical literature

generally recognized by the relevant medical community, physician specialty society

recommendations, and the views of physicians practicing in relevant clinical areas and any other

relevant factors. The director shall create procedures for handling complaints and appeals

concerning the benefits package.

     (c) Restrictions shall not apply. In order for RICHIP participants to be able to receive

medically necessary goods and services, this chapter shall override any state law that restricts the

provision or use of state funds for any medically necessary goods or services, including those

related to family planning and reproductive healthcare.

     (d) Medically necessary goods:

     (1) Prescription drug formulary:

     (i) In general. The director shall establish a prescription drug formulary system, to be

approved by the board, and encourage best-practices in prescribing and discourage the use of

ineffective, dangerous, or excessively costly medications when better alternatives are available.

     (ii) Promotion of generics. The formulary under this subsection shall promote the use of

generic medications to the greatest extent possible.

     (iii) Formulary updates and petition rights. The formulary under this subsection shall be

updated frequently and the director shall create a procedure for patients and providers to make

requests and appeal denials to add new pharmaceuticals or to remove ineffective or dangerous

medications from the formulary.

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     (iv) Use of off-formulary medications. The director shall promulgate rules and regulations

regarding the use of off-formulary medications which allow for patient access but do not

compromise the formulary.

     (v) Approved devices and equipment. The director shall present a list of medically

necessary devices and equipment that shall be covered by RICHIP, subject to final approval by the

board.

     (vi) Bulk purchasing. The director shall seek and implement ways to obtain goods at the

lowest possible cost, including bulk purchasing agreements.

     (e) This section shall take effect when the RICHIP board votes to initiate phase two.

     23-106-7. Providers.

     (a) Rhode Island providers.

     (1) Licensing. Participating providers shall meet state licensing requirements in order to

participate in RICHIP. No provider whose license is under suspension or has been revoked shall

participate in the program.

     (2) Participation. All providers may participate in RICHIP by providing items on the

RICHIP benefits list for which they are licensed. Providers may elect either to participate fully, or

not at all, in the program.

     (3) For-profit providers. For-profit providers may continue to offer services and goods in

Rhode Island, but are prohibited from charging patients more than RICHIP reimbursement rates

for covered services and goods and shall notify qualified Rhode Island residents when the services

and goods they offer will not be reimbursed fully under RICHIP.

     (b) Out-of-state providers. Except for emergency and urgently needed service, as set forth

in § 23-106-7(d), RICHIP shall not pay for healthcare services obtained outside of Rhode Island

unless the following requirements are met:

     (1) The out-of-state provider agrees to accept the RICHIP rate for out-of-state providers;

and

     (2) The services are medically necessary care.

     (c) Out-of-state provider reimbursement. The program shall pay out-of-state healthcare

providers at a rate equal to the average rate paid by commercial insurers or Medicare for the services

rendered, whichever is higher.

     (d) Out-of-state residents.

     (1) In general. Rhode Island providers who provide any services to individuals who are not

RICHIP participants shall not be reimbursed by RICHIP and shall seek reimbursement from those

individuals or other sources.

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     (2) Emergency care exception. Nothing in this chapter shall prevent any individual from

receiving or any provider from providing emergency healthcare services and goods in Rhode

Island. The director shall adopt rules and regulations to provide reimbursement; however, the rules

shall reasonably limit reimbursement to protect the fiscal integrity of RICHIP. The director shall

implement procedures to secure reimbursement from any appropriate third-party funding source or

from the individual to whom the emergency services were rendered.

     (e) This section shall take effect when the RICHIP board votes to initiate phase two.

     23-106-8. Cross border employees.

     (a) State residents employed out-of-state. If an individual is employed out-of-state by an

employer that is subject to Rhode Island state law, the employer and employee shall be required to

pay the payroll taxes as to that employee as if the employment were in the state. If an individual is

employed out-of-state by an employer that is not subject to Rhode Island state law, the employee

health coverage provided by the out-of-state employer to a resident working out-of-state shall serve

as the employee's primary plan of health coverage, and RICHIP shall serve as the employee's

secondary plan of health coverage. The director shall establish procedures for determining amounts

owed by residents employed out-of-state for such supplemental secondary RICHIP coverage and

the extent of such coverage.

     (b) Out-of-state residents employed in the state. The payroll tax set forth in § 23-106-12(i)

shall apply to any out-of-state resident who is employed or self-employed in the state. However,

such out-of-state residents shall be able to take a credit for amounts they spend on health benefits

for themselves that would otherwise be covered by RICHIP if the individual were a RICHIP

participant. The out-of-state resident's employer shall be able to take a credit against such payroll

taxes regardless of the form of the health benefit (e.g., health insurance, a self-insured plan, direct

services, or reimbursement for services), to ensure that the revenue proposal does not relate to

employment benefits in violation of the Federal Employee Retirement Income Security Act

("ERISA") law. For non-employment-based spending by individuals, the credit shall be available

for and limited to spending for health coverage (not out-of-pocket health spending). The credit shall

be available without regard to how little is spent or how sparse the benefit. The credit may only be

taken against the payroll taxes set forth in § 23-106-12(i). Any excess amount may not be applied

to other tax liability. For employment-based health benefits, the credit shall be distributed between

the employer and employee in the same proportion as the spending by each for the benefit. The

employer and employee may each apply their respective portion of the credit to their respective

portion of the payroll taxes set forth in § 23-106-12(i). If any provision of this clause or any

application of it shall be ruled to violate ERISA, the provision or the application of it shall be null

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and void and the ruling shall not affect any other provision or application of this section or this

chapter.

     (c) This section shall take effect when the RICHIP board votes to initiate phase two.

     23-106-9. Provider reimbursement.

     (a) Rates for services and goods. RICHIP reimbursement rates to providers shall be

determined by the RICHIP board. These rates shall be equal to or greater than the federal Medicare

rates available to Rhode Island qualified residents that are in effect at the time services and goods

are provided. For outpatient behavioral health services, the minimum rate shall equal one hundred

fifty percent (150%) of federal Medicare rates. If the director determines that there are no such

federal Medicare reimbursement rates, the director shall set the minimum rate. The director shall

review the rates at least annually, recommend changes to the board, and establish procedures by

which complaints about reimbursement rates may be reviewed by the board.

     (b) Billing and payments. Providers shall submit billing for services to RICHIP participants

in the form of electronic invoices entered into RIFANS, the state's computerized financial system.

The director shall coordinate the manner of processing and payment with the office of accounts and

control and the RIFANS support team within the division of information technology. Payments

shall be made by check or electronic funds transfer in accordance with terms and procedures

coordinated by the director and the office of accounts and control and consistent with the fiduciary

management of the RICHIP trust fund.

     (c) Provider restrictions. In-state providers who accept any payment from RICHIP shall

not bill any patient for any covered benefit. In-state providers cannot use any of their operating

budgets for expansion, profit, excessive executive income, including bonuses, marketing, or major

capital purchases or leases.

     (d) This section shall take effect when the RICHIP board votes to initiate phase two.

     23-106-10. Private insurance companies.

     (a) Non-duplication. It is unlawful for a private health insurer to sell health insurance

coverage to qualified Rhode Island residents that duplicates the benefits provided under this

chapter. Nothing in this chapter shall be construed as prohibiting the sale of health insurance

coverage for any additional benefits not covered by this chapter, including additional benefits that

an employer may provide to employees or their dependents, or to former employees or their

dependents (e.g., multiemployer plans can continue to provide wrap-around coverage for any

benefits not provided by RICHIP).

     (b) Displaced employees. Re-education and job placement of persons employed in Rhode

Island-located enterprises who have lost their jobs as a result of this chapter shall be managed by

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the Rhode Island department of labor and training or an appropriate federal retraining program. The

director may provide funds from RICHIP or funds otherwise appropriated for this purpose for

retraining and assisting job transition for individuals employed or previously employed in the fields

of health insurance, healthcare service plans, and other third-party payments for health care or those

individuals providing services to healthcare providers to deal with third-party payers for health

care, whose jobs may be or have been ended as a result of the implementation of the program,

consistent with applicable laws.

     (c) This section shall take effect when the RICHIP board votes to initiate phase two.

     23-106-11. Budgeting.

     (a) Operating budget. Annually, the director shall create an operating budget for the

program that includes the costs for all benefits set forth in § 23-106-6 and the costs for RICHIP

administration. The director shall determine appropriate reimbursement rates for benefits pursuant

to § 23-106-9(a). The operating budget shall be approved by the executive board prior to

submission to the governor and general assembly.

     (b) Capital expenditures. The director shall work with representatives from state entities

involved with provider capital expenditures including, but not limited to, the Rhode Island

department of administration office of capital projects, the Rhode Island health and educational

building corporation as well as providers to help ensure that capital expenditures proposed by

providers, including amounts to be spent on construction and renovation of health facilities and

major equipment purchases, will address healthcare needs of RICHIP participants. To the extent

that providers are seeking to use RICHIP funds for capital expenditures, the director shall have the

authority to approve or deny such expenditures.

     (c) Prohibition against co-mingling operations and capital improvement funds. It is

prohibited to use funds under this chapter that are earmarked:

     (1) For operations for capital expenditures; or

     (2) For capital expenditures for operations.

     (d) This section shall take effect when the RICHIP board votes to initiate phase two.

     23-106-12. Financing.

     (a) RICHIP trust fund. There shall be established a RICHIP trust fund into which funds

collected pursuant to this chapter are deposited and from which funds are distributed. All money

collected and received shall be used exclusively to finance RICHIP. The governor or general

assembly may provide funds to the RICHIP trust fund, but may not remove or borrow funds from

the RICHIP trust fund.

     (b) Revenue proposal. After approval of the RICHIP executive board, the director shall

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submit to the governor and the general assembly a revenue plan and, if required, legislation

(referred to collectively in this section as the "revenue proposal") to provide the revenue necessary

to finance RICHIP. The initial revenue proposal shall be submitted once waiver negotiations have

proceeded to a level deemed sufficient by the director and annually, thereafter. The basic structure

of the initial revenue proposal will be based on a consideration of:

     (1) Anticipated savings from a single-payer program;

     (2) Government funds available for health care;

     (3) Private funds available for health care; and

     (4) Replacing current regressive health insurance payments made to multiple health

insurance carriers with progressive contributions to a single payer (RICHIP) in order to make

healthcare insurance affordable and remove unnecessary barriers to healthcare access.

     (i) Subsequent proposals shall adjust the RICHIP contributions, based on projections from

the total RICHIP costs in the previous year, and shall include a five (5) year plan for adjusting

RICHIP contributions to best meet the goals set forth in this section and § 23-106-2.

     (c) Anticipated savings. It is anticipated that RICHIP will lower healthcare costs by:

     (1) Eliminating payments to private health insurance carriers;

     (2) Reducing paperwork and administrative expenses for both providers and payers created

by the marketing, sales, eligibility checks, network contract management, issues associated

multiple benefit packages, and other administrative waste associated with the current multi-payer

private health insurance system;

     (3) Allowing the planning and delivery of a public health strategy for the entire population

of Rhode Island;

     (4) Improving access to preventive healthcare; and

     (5) Negotiating on behalf of the state for bulk purchasing of medical supplies and

pharmaceuticals.

     (d) Federal funds. The executive office of health and human services, in collaboration with

the director, the board and the Medicaid office, shall seek and obtain waivers and other approvals

relating to Medicaid, the Children's Health Insurance Program, Medicare, federal tax exemptions

for health care, the ACA, and any other relevant federal programs in order that:

     (1) Federal funds and other subsidies for health care that would otherwise be paid to the

state and its residents and healthcare providers, would be paid by the federal government to the

state and deposited into the RICHIP trust fund;

     (2) Programs would be waived and such funding from federal programs in Rhode Island

would be replaced or merged into RICHIP in order that it can operate as a single-payer program;

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     (3) Maximum federal funding for health care is sought even if any necessary waivers or

approvals are not obtained and multiple sources of funding with RICHIP trust fund monies are

pooled, in order that RICHIP can act as much as possible like a single-payer program to maximize

benefits to Rhode Islanders; and

     (4) Federal financial participation in the programs that are incorporated into RICHIP are

not jeopardized.

     (e) State funds. State funds that would otherwise be appropriated to any governmental

agency, office, program, instrumentality, or institution for services and benefits covered under

RICHIP shall be directed into the RICHIP trust fund. Payments to the fund pursuant to this section

shall be in an amount equal to the money appropriated for those purposes in the fiscal year

beginning immediately preceding the effective date of this chapter.

     (f) Private funds. Private grants including, but not limited to, from nonprofit corporations

and other funds specifically ear-marked for health care including, but not limited to, from litigation

against tobacco companies, opioid manufacturers, shall also be put into the RICHIP trust fund.

     (g) Assignments from RICHIP participants. Receipt of healthcare services under the plan

shall be deemed an assignment by the RICHIP participant of any right to payment for services from

a policy of insurance, a health benefit plan or other source. The other source of healthcare benefits

shall pay to the fund all amounts it is obligated to pay to, or on behalf of, the RICHIP participant

for covered healthcare services. The director shall commence any action necessary to recover the

amounts due.

     (h) Replacing current health insurance payments with progressive contributions. Instead of

making health insurance payments to multiple carriers including, but not limited to, for premiums,

co-pays deductibles, and costs in excess of caps for limited coverage, individuals and entities

subject to Rhode Island taxation pursuant to § 44-30-1 shall pay progressive contributions to the

RICHIP trust fund (referred to collectively in this section as the "RICHIP contributions") for

comprehensive coverage. These RICHIP contributions shall be set and adjusted over time to an

appropriate level to:

     (1) Cover the actual cost of the program;

     (2) Ensure that higher brackets of income subject to specified taxes shall be assessed at a

higher marginal rate than lower brackets; and

     (3) Protect the economic welfare of small businesses, low-income earners and working

families through tax credits or exemptions.

     (i) Contributions based on earned income. The amounts currently paid by employers and

employees for health insurance shall initially be replaced by a ten percent (10%) payroll tax, based

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on the projected average payroll of employees over three (3) previous calendar years. The employer

shall pay eighty percent (80%) and the employee shall pay twenty percent (20%) of this payroll

tax, except that an employer may agree to pay all or part of the employee's share. Self- employed

individuals shall initially pay one-hundred percent (100%) of the payroll tax. The ten percent (10%)

initial rate will be adjusted by the director in order that higher brackets of income subject to these

taxes shall be assessed at a higher marginal rate than lower brackets and in order that small

businesses and lower income earners receive a credit or exemption.

     (j) Contributions based on unearned income. There shall be a progressive contribution

based on unearned income including, but not limited to, capital gains, dividends, interest, profits,

and rents. Initially, the unearned income RICHIP contributions shall be equal to ten percent (10%)

of such unearned income. The ten percent (10%) initial rate may be adjusted by the director to

allow for a graduated progressive exemption or credit for individuals with lower unearned income

levels.

     (e) This section shall take effect when the RICHIP board votes to initiate phase two.

     23-106-12. Implementation.

     (a) State laws and regulations.

     (1) In general. The director shall work with the RICHIP board and receive such assistance

as may be necessary from other state agencies and entities to examine state laws and regulations

and to make recommendations necessary to conform such laws and regulations to properly

implement the RICHIP program. The director shall report any recommendations to the governor

and the general assembly.

     (2) Anti-trust laws. The intent of this chapter is to exempt activities provided for under this

chapter from state antitrust laws and to provide immunity from federal antitrust laws through the

state action doctrine.

     (b) Severability. If any provision or application of this chapter shall be held to be invalid,

or to violate or be inconsistent with any applicable federal law or regulation, that shall not affect

other provisions or applications of this chapter which can be given effect without that provision or

application; and to that end, the provisions and applications of this chapter are severable.

     SECTION 2. Chapter 22-11 of the General Laws entitled "Joint Committee on Legislative

Services" is hereby amended by adding thereto the following section:

     22-11-4.1. Health policy staffing.

     The joint committee on legislative services shall fund five (5) new full-time employees

(FTEs) for the senate fiscal office and five (5) new FTEs for the house fiscal office exclusively

devoted to health policy.

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     SECTION 3. Section 27-34.3-7 of the General Laws in Chapter 27-34.3 entitled "Rhode

Island Life and Health Insurance Guaranty Association Act" is hereby amended to read as follows:

     27-34.3-7. Board of directors.

     (a) The board of directors of the association shall consist of:

     (1) Not less than five (5) nor more than nine (9) member insurers serving terms as

established in the plan of operation Nine (9) members appointed by the governor with advice and

consent of the senate; and

     (2) The commissioner or the commissioner’s designee shall chair the board in a non-voting

ex officio capacity. Only member insurers shall be eligible to vote. The members of the board shall

be selected by member insurers subject to the approval of the commissioner. The board of directors,

previously established under § 27-34.1-8 [repealed], shall continue to operate in accordance with

the provision of this section. Vacancies on the board shall be filled for the remaining period of the

term by a majority vote of the remaining board members, subject to the approval of the

commissioner.

     (b) In approving selections to the board, the commissioner shall consider, among other

things, whether all member insurers are fairly represented.

     (c) Members of the board may be reimbursed from the assets of the association for expenses

incurred by them as members of the board of directors but members of the board shall not be

compensated by the association for their services.

     SECTION 4. Section 27-66-24 of the General Laws in Chapter 27-66 entitled "The Health

Insurance Conversions Act" is hereby amended to read as follows:

     27-66-24. Exceptions — Rehabilitation, liquidation, or conservation.

     No proposed conversion shall be subject to this chapter in In the event that the a health

insurance corporation, health maintenance corporation, pharmacy benefit manager, nonprofit

dental service corporation, managed care organization, nonprofit optometric service corporation, a

nonprofit hospital service corporation, nonprofit medical service corporation, or affiliate or

subsidiary of them, hereinafter the "insurer", is subject to an order from the superior court directing

the director to rehabilitate, liquidate, or conserve, as provided in §§ 27-19-28, 27-20-24, 27-41-18,

or chapter 14.1, 14.2, 14.3, or 14.4 of this title, certain additional conditions shall apply to the

insurer:

     (1) The insolvency, financial condition, or default of the insurer at any time shall not permit

the insurer to fail to pay claims in a timely manner.

     (2) Should the insurer fail to pay claims in a timely manner, those claims shall become a

temporary obligation of the state, who shall pay them in a timely manner. Should the state be

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compelled to pay claims for this reason, the insurer shall owe the state a fine ten (10) times the

value of all claims paid.

     (3) The insolvency, financial condition, or default of the insurer at any time shall not permit

the insurer to fail to pay state taxes on time. Should the insurer fail to pay taxes on time, the size of

the tax obligation owed shall increase by a factor of ten (10).

     (4) The RICHIP board and its state-owned health insurance company shall be guaranteed

a right of first refusal to acquire the insurer before alternate buyers are considered. Any obligations

due to the state by the insurer shall be counted towards the purchase price of the insurer. The Rhode

Island life and health insurance guaranty association, created pursuant to § 27-34.3-6, shall pay the

costs of an acquisition by the RICHIP board or its state-owned health insurance company pursuant

to this section.

     SECTION 5. Title 27 of the General Laws entitled "INSURANCE" is hereby amended by

adding thereto the following chapter:

CHAPTER 84

PRIOR AUTHORIZATION OF CERTAIN HEALTH INSURANCE POLICY CHANGES

     27-84-1. Definitions.

     For purposes of this chapter:

     "Health insurer" means any entity subject to the insurance laws and regulations of this state,

or subject to the jurisdiction of the health insurance commissioner, that contracts or offers to

contract, to provide and/or insuring health services on a prepaid basis including, but not limited to,

policies of accident and sickness insurance subject to chapter 18 of title 27; any nonprofit hospital

service corporation subject to chapter 19 of title 27; any nonprofit medical service corporation

subject to chapter 20 of title 27; any health maintenance organization subject to chapter 41 of title

27; any nonprofit dental service corporation subject to chapter 20.1 of title 27; any nonprofit

optometric service corporation subject to chapter 20.2 of title 27; any pharmacy benefit manager;

or any health benefit plan issued by the State of Rhode Island, a municipality, a quasi-public

agency, or any other political subdivision of the State of Rhode Island to cover employees.

     27-84-2. Prior authorization of general assembly.

     (a) Prior authorization of the general assembly shall be required for certain policy changes

by health insurers:

     (1) Any change that increases the average amount charged annually to consumers on a per

beneficiary basis;

     (2) Any change that in any way reduces any benefits offered to plan beneficiaries;

     (3) Any change that increases any premiums, deductibles, or copays;

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     (4) Ceasing offering any plan a health insurer offers within the State of Rhode Island; or

     (5) Any other change that the health insurance commissioner or attorney general shall,

through regulation, determine to require prior authorization of the general assembly.

     (b) No rate reviews pursuant to those utilized in §§ 27-18-54, 27-19-30.1, 27-20-25.2, 27-

41-27.2, and 42-62-13 shall be construed to exempt any health insurer from the prior authorization

requirements of this chapter.

     SECTION 6. Section 28-57-5 of the General Laws in Chapter 28-57 entitled "Healthy and

Safe Families and Workplaces Act" is hereby amended to read as follows:

     28-57-5. Accrual of paid sick and safe leave time.

     (a) All employees employed by an employer of eighteen (18) or more employees in Rhode

Island shall accrue a minimum of one hour of paid sick and safe leave time for every thirty five

(35) hours worked up to a maximum of twenty-four (24) hours during calendar year 2018, thirty-

two (32) hours during calendar year 2019, and up to a maximum of forty (40) hours per year from

calendar year 2020 through calendar year 2027, and one hundred sixty (160) hours per year

thereafter, unless the employer chooses to provide a higher annual limit in both accrual and use. In

determining the number of employees who are employed by an employer for compensation, all

employees defined in § 28-57-3(7) shall be counted.

     (b) Employees who are exempt from the overtime requirements under 29 U.S.C. §

213(a)(1) of the federal Fair Labor Standards Act, 29 U.S.C. § 201 et seq., will be assumed to work

forty (40) hours in each workweek for purposes of paid sick and safe leave time accrual unless their

normal workweek is less than forty (40) hours, in which case paid sick and safe leave time accrues

based upon that normal workweek.

     (c) Paid sick and safe leave time as provided in this chapter shall begin to accrue at the

commencement of employment or pursuant to the law’s effective date [July 1, 2018], whichever is

later. An employer may provide all paid sick and safe leave time that an employee is expected to

accrue in a year at the beginning of the year.

     (d) An employer may require a waiting period for newly hired employees of up to ninety

(90) days. During this waiting period, an employee shall accrue earned sick time pursuant to this

section or the employer’s policy, if exempt under § 28-57-4(b), but shall not be permitted to use

the earned sick time until after he or she has completed the waiting period.

     (e) Paid sick and safe leave time shall be carried over to the following calendar year;

however, an employee’s use of paid sick and safe leave time provided under this chapter in each

calendar year shall not exceed twenty-four (24) hours during calendar year 2018, and thirty-two

(32) hours during calendar year 2019, and forty (40) hours per year thereafter. Alternatively, in lieu

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of carryover of unused earned paid sick and safe leave time from one year to the next, an employer

may pay an employee for unused earned paid sick and safe leave time at the end of a year and

provide the employee with an amount of paid sick and safe leave that meets or exceeds the

requirements of this chapter that is available for the employee’s immediate use at the beginning of

the subsequent year.

     (f) Nothing in this chapter shall be construed as requiring financial or other reimbursement

to an employee from an employer upon the employee’s termination, resignation, retirement, or

other separation from employment for accrued paid sick and safe leave time that has not been used.

     (g) If an employee is transferred to a separate division, entity, or location within the state,

but remains employed by the same employer as defined in 29 C.F.R. § 791.2 of the federal Fair

Labor Standards Act, 29 U.S.C. § 201 et seq., the employee is entitled to all paid sick and safe leave

time accrued at the prior division, entity, or location and is entitled to use all paid sick and safe

leave time as provided in this act. When there is a separation from employment and the employee

is rehired within one hundred thirty-five (135) days of separation by the same employer, previously

accrued paid sick and safe leave time that had not been used shall be reinstated. Further, the

employee shall be entitled to use accrued paid sick and safe leave time and accrue additional sick

and safe leave time at the re-commencement of employment.

     (h) When a different employer succeeds or takes the place of an existing employer, all

employees of the original employer who remain employed by the successor employer within the

state are entitled to all earned paid sick and safe leave time they accrued when employed by the

original employer, and are entitled to use earned paid sick and safe leave time previously accrued.

     (i) At its discretion, an employer may loan sick and safe leave time to an employee in

advance of accrual by such employee.

     (j) Temporary employees shall be entitled to use accrued paid sick and safe leave time

beginning on the one hundred eightieth (180) calendar day following commencement of their

employment, unless otherwise permitted by the employer. On and after the one hundred eightieth

(180) calendar day of employment, employees may use paid sick and safe leave time as it is

accrued. During this waiting period, an employee shall accrue earned sick time pursuant to this

chapter, but shall not be permitted to use the earned sick time until after he or she has completed

the waiting period.

     (k) Seasonal employees shall be entitled to use accrued paid sick and safe leave time

beginning on the one hundred fiftieth (150) calendar day following commencement of their

employment, unless otherwise permitted by the employer. On and after the one hundred fiftieth

(150) calendar day of employment, employees may use paid sick and safe leave time as it is

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accrued. During this waiting period, an employee shall accrue earned sick time pursuant to this

chapter, but shall not be permitted to use the earned sick time until after he or she has completed

the waiting period.

     SECTION 7. Sections 40-8-2, 40-8-6, 40-8-10, 40-8-13, 40-8-16, 40-8-26 and 40-8-32 of

the General Laws in Chapter 40-8 entitled "Medical Assistance" are hereby amended to read as

follows:

     40-8-2. Definitions.

     As used in this chapter, unless the context shall otherwise require:

     (1) “Dental service” means and includes emergency care, X-rays for diagnoses, extractions,

palliative treatment, and the refitting and relining of existing dentures and prosthesis.

     (2) “Department” means the department of human services.

     (3) “Director” means the director of human services Medicaid director.

     (4) “Drug” means and includes only drugs and biologicals prescribed by a licensed dentist

or physician as are either included in the United States pharmacopoeia, national formulary, or are

new and nonofficial drugs and remedies.

     (5) “Inpatient” means a person admitted to and under treatment or care of a physician or

surgeon in a hospital or nursing facility that meets standards of and complies with rules and

regulations promulgated by the director.

     (6) “Inpatient hospital services” means the following items and services furnished to an

inpatient in a hospital other than a hospital, institution, or facility for tuberculosis or mental

diseases:

     (i) Bed and board;

     (ii) Nursing services and other related services as are customarily furnished by the hospital

for the care and treatment of inpatients and drugs, biologicals, supplies, appliances, and equipment

for use in the hospital, as are customarily furnished by the hospital for the care and treatment of

patients;

     (iii)(A) Other diagnostic or therapeutic items or services, including, but not limited to,

pathology, radiology, and anesthesiology furnished by the hospital or by others under arrangements

made by the hospital, as are customarily furnished to inpatients either by the hospital or by others

under such arrangements, and services as are customarily provided to inpatients in the hospital by

an intern or resident-in-training under a teaching program having the approval of the Council on

Medical Education and Hospitals of the American Medical Association or of any other recognized

medical society approved by the director.

     (B) The term “inpatient hospital services” shall be taken to include medical and surgical

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services provided by the inpatient’s physician, but shall not include the services of a private-duty

nurse or services in a hospital, institution, or facility maintained primarily for the treatment and

care of patients with tuberculosis or mental diseases. Provided, further, it shall be taken to include

only the following organ transplant operations: kidney, liver, cornea, pancreas, bone marrow, lung,

heart, and heart/lung, and other organ transplant operations as may be designated by the director

after consultation with medical advisory staff or medical consultants; and provided that any such

transplant operation is determined by the director or his or her designee to be medically necessary.

Prior written approval of the director, or his or her designee, shall be required for all covered organ

transplant operations.

     (C) In determining medical necessity for organ transplant procedures, the state plan shall

adopt a case-by-case approach and shall focus on the medical indications and contra-indications in

each instance; the progressive nature of the disease; the existence of any alternative therapies; the

life-threatening nature of the disease; the general state of health of the patient apart from the

particular organ disease; and any other relevant facts and circumstances related to the applicant and

the particular transplant procedure.

     (7) "Medicare equivalent rate" means the amount that would be paid for the relevant

services as furnished by the relevant group of facilities under Medicare payment principles

delineated in subchapter B of 42 CFR Chapter IV. Should no direct Medicare rates be available for

the particular service and facility group, the Medicaid director will estimate the rate. Providers will

have standing to bring an action in superior court for a higher rate, but intermediary insurers such

as managed care entities shall have no standing to bring an action for a lower rate.

     (7)(8) “Nursing services” means the following items and services furnished to an inpatient

in a nursing facility:

     (i) Bed and board;

     (ii) Nursing care and other related services as are customarily furnished to inpatients

admitted to the nursing facility, and drugs, biologicals, supplies, appliances, and equipment for use

in the facility, as are customarily furnished in the facility for the care and treatment of patients;

     (iii) Other diagnostic or therapeutic items or services, legally furnished by the facility or

by others under arrangements made by the facility, as are customarily furnished to inpatients either

by the facility or by others under such arrangement;

     (iv) Medical services provided in the facility by the inpatient’s physician, or by an intern

or resident-in-training of a hospital with which the facility is affiliated or that is under the same

control, under a teaching program of the hospital approved as provided in subsection (6); and

     (v) A personal-needs allowance of seventy-five dollars ($75.00) two hundred dollars

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($200) per month.

     (8)(9) “Relative with whom the dependent child is living” means and includes the father,

mother, grandfather, grandmother, brother, sister, stepfather, stepmother, stepbrother, stepsister,

uncle, aunt, first cousin, nephew, or niece of any dependent child who maintains a home for the

dependent child.

     (9)(10) “Visiting nurse service” means part-time or intermittent nursing care provided by

or under the supervision of a registered professional nurse other than in a hospital or nursing home.

     40-8-6. Review of application for benefits.

     The director, or someone designated by him or her, shall review each application for

benefits filed in accordance with regulations, and shall make a determination of whether the

application will be honored and the extent of the benefits to be made available to the applicant, and

shall, within thirty (30) fifteen (15) days after the filing, notify the applicant, in writing, of the

determination. If the application is rejected, the notice to the applicant shall set forth therein the

reason therefor. The director may at any time reconsider any determination.

     40-8-10. Recovery of benefits paid in error.

     Any person, who through error or mistake of himself or herself or another willful and

knowing fraudulent misrepresentation, receives medical care benefits to which he or she is not

entitled or with respect to which he or she was ineligible, shall be required to reimburse the state

for the benefits paid through error or mistake that were paid out during a time period, not to exceed

three (3) years, where the person was not entitled to benefits but received them as a result of the

willful and knowing fraudulent misrepresentation.

     40-8-13. Rules, regulations, and fee schedules.

     The director shall make and promulgate rules, regulations, and fee schedules not

inconsistent with state law and fiscal procedures as he or she deems necessary for the proper

administration of this chapter and to carry out the policy and purposes thereof, and to make the

department’s plan conform to the provisions of the federal Social Security Act, 42 U.S.C. § 1396

et seq., and any rules or regulations promulgated pursuant thereto. Except where explicitly

authorized by this title, the director shall have no power to set any fee schedule below the Medicare

equivalent rate; provided, however, that the director shall be empowered to provide a lower rate

equal to the maximum rate where federal reimbursement can be obtained in the event that federal

reimbursement cannot be obtained for the Medicare equivalent rate. For outpatient behavioral

health services, the minimum fee schedule shall be set at one hundred fifty percent (150%) of the

Medicare equivalent rate. The director shall attempt to obtain federal reimbursement for billing

outpatient behavioral health services at one hundred fifty percent (150%) of the Medicare

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equivalent rate, but the state shall bear the costs of this higher rate for outpatient behavioral health

services even if federal reimbursement cannot be obtained. Should federal financial participation

be impossible to obtain for the outpatient behavioral health services rate of one hundred fifty

percent (150%) of the Medicare equivalent rate, the director shall impose a surtax on the tax

imposed on health insurers pursuant to chapter 17 of title 44 in the amount necessary to defray the

costs of the inability to obtain federal reimbursement for an outpatient behavioral health services

rate of one hundred fifty percent (150%) of the Medicare equivalent rate.

     40-8-16. Notification of long-term care alternative.

     (a) The department of human services, before authorizing care in a nursing home or

intermediate-care facility for a person who is eligible to receive benefits pursuant to Title XIX of

the federal Social Security Act, 42 U.S.C. § 1396 et seq., and who is being discharged from a

hospital to a nursing home, shall notify the person, in writing, of the provisions of the long-term-

care alternative, a home- and a community-based program.

     (b) If a person, eligible to receive benefits pursuant to Title XIX of the federal Social

Security Act, requires services in a nursing home and desires to remain in his or her own home or

the home of a responsible relative or other adult, the person or his or her representative shall so

inform the department.

     (c) The department shall not make payments pursuant to Title XIX of the federal Social

Security Act for benefits until written notification documenting the person’s choice as to a nursing

home or home- and community-based services has been filed with the department.

     40-8-26. Community health centers.

     (a) For the purposes of this section, the term community health centers refers to federally

qualified health centers and rural health centers.

     (b) To support the ability of community health centers to provide high-quality medical care

to patients, the executive office of health and human services (“executive office”) may adopt and

implement an alternative payment methodology (APM) for determining a Medicaid per-visit

reimbursement for community health centers that is compliant with the prospective payment system

(PPS) provided for in the Medicare, Medicaid, and SCHIP Benefits Improvement and Protection

Act of 2000. The following principles are to ensure that the APM PPS rate determination

methodology is part of the executive office overall value purchasing approach. For community

health centers that do not agree to the principles of reimbursement that reflect the APM PPS,

EOHHS shall reimburse such community health centers at the federal PPS rate, as required per

section 1902(bb)(3) of the Social Security Act, 42 U.S.C. § 1396a(bb)(3). For community health

centers that are reimbursed at the federal PPS rate, subsections (d) through (f) of this section apply.

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     (c) The APM PPS rate determination methodology will (i) Fairly recognize the reasonable

costs of providing services. Recognized reasonable costs will be those appropriate for the

organization, management, and direct provision of services and (ii) Provide assurances to the

executive office that services are provided in an effective and efficient manner, consistent with

industry standards. Except for demonstrated cause and at the discretion of the executive office, the

maximum reimbursement rate for a service (e.g., medical, dental) provided by an individual

community health center shall not exceed one hundred twenty-five percent (125%) of the median

rate for all community health centers within Rhode Island. not only bill the community health center

on a fee-for-service basis at the Medicare equivalent rate but also make a series of quality incentive

payments if the community health center meets certain quality incentives. Quality incentive

payments shall be set at a percentage of the aggregate monthly billing. The quality incentive

payments shall be as follows:

     (1) Ten percent (10%) for meeting benchmarks set by the Medicaid director for screening

patients for Medicaid eligibility.

     (2) Five percent (5%) for meeting benchmarks set by the Medicaid director for enrolling

patients who regularly smoke tobacco in smoking cessation programs.

     (3) Ten percent (10%) for meeting benchmarks set by the director of human services for

screening patients for supplemental nutrition assistance program eligibility.

     (4) Ten percent (10%) for ensuring that no more than one percent of patients are ever not

offered an appointment within a month if they request one.

     (5) Up to fifteen percent (15%) for meeting benchmarks set by the Medicaid director for

the improvement of air quality in patients' homes through directly funding interventions including,

but not limited: air quality inspections, the installation of air filters, the installation of ventilation,

and the replacement of gas stoves with electric stoves.

     (6) Up to fifteen percent (15%) for meeting benchmarks set by the Medicaid director for

the removal or mitigation of environmental toxins in patients' homes through the direct funding of

removal or mitigation of environmental toxins. These toxins shall include, but shall not be limited

to, lead, radon, asbestos, and carbon monoxide.

     (d) Community health centers will cooperate fully and timely with reporting requirements

established by the executive office.

     (e) Reimbursement rates established through this methodology shall be incorporated into

the PPS reconciliation for services provided to Medicaid-eligible persons who are enrolled in a

health plan on the date of service. Monthly payments by the executive office related to PPS for

persons enrolled in a health plan shall be made directly to the community health centers.

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     (f) Reimbursement rates established through this the APM methodology shall not be

incorporated into the actuarially certified capitation rates paid to a health plan. The health plan shall

be responsible for paying the full amount of the reimbursement rate to the community health center

for each service eligible for reimbursement under the Medicare, Medicaid, and SCHIP Benefits

Improvement and Protection Act of 2000. If the health plan has an alternative payment arrangement

with the community health center opts to utilize the APM methodology, the health plan may

establish a PPS reconciliation process for eligible services and make monthly payments related to

PPS for persons enrolled in the health plan on the date of service shall bear the full upside and

downside risk of decreased or increased costs from the APM methodology. The executive office

will review, at least annually, the Medicaid reimbursement rates and reconciliation methodology

used by the health plans for community health centers to ensure payments to each are made in

compliance with the Medicare, Medicaid, and SCHIP Benefits Improvement and Protection Act of

2000.

     40-8-32. Support for certain patients of nursing facilities.

     (a) Definitions. For purposes of this section:

     (1) “Applied income” shall mean the amount of income a Medicaid beneficiary is required

to contribute to the cost of his or her care.

     (2) “Authorized individual” shall mean a person who has authority over the income of a

patient of a nursing facility, such as a person who has been given or has otherwise obtained

authority over a patient’s bank account; has been named as or has rights as a joint account holder;

or is a fiduciary as defined below.

     (3) “Costs of care” shall mean the costs of providing care to a patient of a nursing facility,

including nursing care, personal care, meals, transportation, and any other costs, charges, and

expenses incurred by a nursing facility in providing care to a patient. Costs of care shall not exceed

the customary rate the nursing facility charges to a patient who pays for his or her care directly

rather than through a governmental or other third-party payor.

     (4) “Fiduciary” shall mean a person to whom power or property has been formally

entrusted for the benefit of another, such as an attorney-in-fact, legal guardian, trustee, or

representative payee.

     (5) “Nursing facility” shall mean a nursing facility licensed under chapter 17 of title 23,

that is a participating provider in the Rhode Island Medicaid program.

     (6) “Penalty period” means the period of Medicaid ineligibility imposed pursuant to 42

U.S.C. § 1396p(c), as amended from time to time, on a person whose assets have been transferred

for less than fair market value.

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     (7) “Uncompensated care” — Care and services provided by a nursing facility to a

Medicaid applicant without receiving compensation therefore from Medicaid, Medicare, the

Medicaid applicant, or other source. The acceptance of any payment representing actual or

estimated applied income shall not disqualify the care and services provided from qualifying as

uncompensated care.

     (b) Penalty period resulting from transfer. Any transfer or assignment of assets resulting in

the establishment or imposition of a penalty period shall create a debt that shall be due and owing

to a nursing facility for the unpaid costs of care provided during the penalty period to a patient of

that facility who has been subject to the penalty period. The amount of the debt established shall

not exceed the fair market value of the transferred assets at the time of transfer that are the subject

of the penalty period. A nursing facility may bring an action to collect a debt for the unpaid costs

of care given to a patient who has been subject to a penalty period, against either the transferor or

the transferee, or both. The provisions of this section shall not affect other rights or remedies of the

parties.

     (c) Applied income. A nursing facility may provide written notice to a patient who is a

Medicaid recipient and any authorized individual of that patient:

     (1) Of the amount of applied income due;

     (2) Of the recipient’s legal obligation to pay the applied income to the nursing facility; and

     (3) That the recipient’s failure to pay applied income due to a nursing facility not later than

thirty (30) days after receiving notice from the nursing facility may result in a court action to

recover the amount of applied income due.

     A nursing facility that is owed applied income may, in addition to any other remedies

authorized under law, bring a claim to recover the applied income against a patient and any

authorized individual. If a court of competent jurisdiction determines, based upon clear and

convincing evidence, that a defendant willfully failed to pay or withheld applied income due and

owing to a nursing facility for more than thirty (30) days after receiving notice pursuant to

subsection (c), the court may award the amount of the debt owed, court costs, and reasonable

attorney’s fees to the nursing facility.

     (d) Effects. Nothing contained in this section shall prohibit or otherwise diminish any other

causes of action possessed by any such nursing facility. The death of the person receiving nursing

facility care shall not nullify or otherwise affect the liability of the person or persons charged with

the costs of care rendered or the applied income amount as referenced in this section.

     SECTION 8. Sections 40-8-3.1, 40-8-9.1, 40-8-13.5, 40-8-15, 40-8-19.2 and 40-8-27 of

the General Laws in Chapter 40-8 entitled "Medical Assistance" are hereby repealed.

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     40-8-3.1. Life estate in property — Retained powers.

     When an applicant or recipient of Medicaid owns a life estate in property that is his or her

principal place of residence with the reserved power and authority, during his or her lifetime, to

sell, convey, mortgage, or otherwise dispose of the real property without the consent or joinder by

the holder(s) of the remainder interest, the principal place of residence shall not be regarded as an

excluded resource for the purpose of Medicaid eligibility, unless the applicant or recipient

individually, or through his or her guardian, conservator, or attorney in fact, conveys all outstanding

remainder interest to him or herself.

     An applicant or recipient who, by a deed created, executed and recorded on or before June

30, 2014, has reserved a life estate in property that is his or her principal place of residence with

the reserved power and authority, during his or her lifetime, to sell, convey, mortgage, or otherwise

dispose of the real property without the consent or joinder by the holder(s) of the remainder interest,

shall not be ineligible for Medicaid on the basis of the deed, regardless of whether the transferee of

the remainder interest is a person or persons, trust, or entity.

     40-8-9.1. Notice.

     Whenever an individual who is receiving medical assistance under this chapter transfers

an interest in real or personal property, the individual shall notify the executive office of health and

human services within ten (10) days of the transfer. The notice shall be sent to the individual’s local

office and the legal office of the executive office of health and human services and include, at a

minimum, the individual’s name, social security number or, if different, the executive office of

health and human services identification number, the date of transfer, and the dollar value, if any,

paid or received by the individual who received benefits under this chapter. In the event an

individual fails to provide notice required by this section to the executive office of health and human

services and in the event an individual has received medical assistance, any individual and/or entity,

who knew or should have known that the individual failed to provide the notice and who receives

any distribution of value as a result of the transfer, shall be liable to the executive office of health

and human services to the extent of the value of the transfer. Moreover, any such individual shall

be subject to the provisions of § 40-6-15 and any remedy provided by applicable state and federal

laws and rules and regulations. Failure to comply with the notice requirements set forth in the

section shall not affect the marketability of title to real estate transferred while the transferor is

receiving medical assistance.

     40-8-13.5. Hospital Incentive Program (HIP).

     The secretary of the executive office of health and human services is authorized to seek the

federal authorities required to implement a hospital incentive program (HIP). The HIP shall provide

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the participating licensed hospitals the ability to obtain certain payments for achieving performance

goals established by the secretary. HIP payments shall commence no earlier than July 1, 2016.

     40-8-15. Lien on deceased recipient’s estate for assistance.

     (a)(1) Upon the death of a recipient of Medicaid under Title XIX of the federal Social

Security Act (42 U.S.C. § 1396 et seq. and referred to hereinafter as the “Act”), the total sum for

Medicaid benefits so paid on behalf of a beneficiary who was fifty-five (55) years of age or older

at the time of receipt shall be and constitute a lien upon the estate, as defined in subsection (a)(2),

of the beneficiary in favor of the executive office of health and human services (“executive office”).

The lien shall not be effective and shall not attach as against the estate of a beneficiary who is

survived by a spouse, or a child who is under the age of twenty-one (21), or a child who is blind or

permanently and totally disabled as defined in Title XVI of the federal Social Security Act, 42

U.S.C. § 1381 et seq. The lien shall attach against property of a beneficiary, which is included or

includable in the decedent’s probate estate, regardless of whether or not a probate proceeding has

been commenced in the probate court by the executive office or by any other party. Provided,

however, that such lien shall only attach and shall only be effective against the beneficiary’s real

property included or includable in the beneficiary’s probate estate if such lien is recorded in the

land evidence records and is in accordance with subsection (e). Decedents who have received

Medicaid benefits are subject to the assignment and subrogation provisions of §§ 40-6-9 and 40-6-

10.

     (2) For purposes of this section, the term “estate” with respect to a deceased individual

shall include all real and personal property and other assets included or includable within the

individual’s probate estate.

     (b) The executive office is authorized to promulgate regulations to implement the terms,

intent, and purpose of this section and to require the legal representative(s) and/or the heirs-at-law

of the decedent to provide reasonable written notice to the executive office of the death of a

beneficiary of Medicaid benefits who was fifty-five (55) years of age or older at the date of death,

and to provide a statement identifying the decedent’s property and the names and addresses of all

persons entitled to take any share or interest of the estate as legatees or distributees thereof.

     (c) The amount of reimbursement for Medicaid benefits imposed under this section shall

also become a debt to the state from the person or entity liable for the payment thereof.

     (d) Upon payment of the amount of reimbursement for Medicaid benefits imposed by this

section, the secretary of the executive office, or his or her designee, shall issue a written discharge

of lien.

     (e) Provided, however, that no lien created under this section shall attach nor become

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effective upon any real property unless and until a statement of claim is recorded naming the

debtor/owner of record of the property as of the date and time of recording of the statement of

claim, and describing the real property by a description containing all of the following: (1) Tax

assessor’s plat and lot; and (2) Street address. The statement of claim shall be recorded in the

records of land evidence in the town or city where the real property is situated. Notice of the lien

shall be sent to the duly appointed executor or administrator, the decedent’s legal representative, if

known, or to the decedent’s next of kin or heirs at law as stated in the decedent’s last application

for Medicaid benefits.

     (f) The executive office shall establish procedures, in accordance with the standards

specified by the Secretary, United States Department of Health and Human Services, under which

the executive office shall waive, in whole or in part, the lien and reimbursement established by this

section if the lien and reimbursement would cause an undue hardship, as determined by the

executive office, on the basis of the criteria established by the secretary in accordance with 42

U.S.C. § 1396p(b)(3).

     (g) Upon the filing of a petition for admission to probate of a decedent’s will or for

administration of a decedent’s estate, when the decedent was fifty-five (55) years or older at the

time of death, a copy of the petition and a copy of the death certificate shall be sent to the executive

office. Within thirty (30) days of a request by the executive office, an executor or administrator

shall complete and send to the executive office a form prescribed by that office and shall provide

such additional information as the office may require. In the event a petitioner fails to send a copy

of the petition and a copy of the death certificate to the executive office and a decedent has received

Medicaid benefits for which the executive office is authorized to recover, no distribution and/or

payments, including administration fees, shall be disbursed. Any person and/or entity that receives

a distribution of assets from the decedent’s estate shall be liable to the executive office to the extent

of such distribution.

     (h) Compliance with the provisions of this section shall be consistent with the requirements

set forth in § 33-11-5 and the requirements of the affidavit of notice set forth in § 33-11-5.2. Nothing

in these sections shall limit the executive office from recovery, to the extent of the distribution, in

accordance with all state and federal laws.

     (i) To ensure the financial integrity of the Medicaid eligibility determination, benefit

renewal, and estate recovery processes in this and related sections, the secretary of health and

human services is authorized and directed to, by no later than August 1, 2018: (1) Implement an

automated asset verification system, as mandated by § 1940 of the Act, that uses electronic data

sources to verify the ownership and value of countable resources held in financial institutions and

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any real property for applicants and beneficiaries subject to resource and asset tests pursuant to the

Act in § 1902(e)(14)(D); (2) Apply the provisions required under §§ 1902(a)(18) and 1917(c) of

the Act pertaining to the disposition of assets for less than fair market value by applicants and

beneficiaries for Medicaid long-term services and supports and their spouses, without regard to

whether they are subject to or exempted from resources and asset tests as mandated by federal

guidance; and (3) Pursue any state plan or waiver amendments from the United States Centers for

Medicare and Medicaid Services and promulgate such rules, regulations, and procedures he or she

deems necessary to carry out the requirements set forth herein and ensure the state plan and

Medicaid policy conform and comply with applicable provisions of Title XIX.

     40-8-19.2. Nursing Facility Incentive Program (NFIP).

     The secretary of the executive office of health and human services is authorized to seek the

federal authority required to implement a nursing facility incentive program (NFIP). The NFIP

shall provide the participating licensed nursing facilities the ability to obtain certain payments for

achieving performance goals established by the secretary. NFIP payments shall commence no

earlier than July 1, 2016.

     40-8-27. Cooperation by providers.

     Medicaid providers who employ individuals applying for benefits under any chapter of this

title shall comply in a timely manner with requests made by the department for any documents

describing employer-sponsored health insurance coverage or benefits the provider offers that are

necessary to determine eligibility for the state’s premium assistance program pursuant to § 40-8.4-

12. Documents requested by the department may include, but are not limited to, certificates of

coverage or a summary of benefits and employee obligations. Upon receiving notification that the

department has determined that the employee is eligible for premium assistance under § 40-8.4-12,

the provider shall accept the enrollment of the employee and his or her family in the employer-

based health insurance plan without regard to any seasonal enrollment restrictions, including open-

enrollment restrictions, and/or the impact on the employee’s wages. Additionally, the Medicaid

provider employing such persons shall not offer “pay in lieu of benefits.” Providers who do not

comply with the provisions set forth in this section shall be subject to suspension as a participating

Medicaid provider.

     SECTION 9. Sections 40-8.4-5, 40-8.4-10, 40-8.4-12, 40-8.4-15 and 40-8.4-19 of the

General Laws in Chapter 40-8.4 entitled "Health Care for Families" are hereby amended to read as

follows:

     40-8.4-5. Managed care.

     The delivery and financing of the healthcare services provided under this chapter shall may

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be provided through a system of managed care. A managed care system integrates an efficient

financing mechanism with quality service delivery; provides a “medical home” to ensure

appropriate care and deter unnecessary and inappropriate care; and places emphasis on preventive

and primary health care. Beginning July 1, 2030, all payments shall be provided directly by the

state without an intermediate payment to a managed care entity or other form of health insurance

company, unless it is owned by the state. Beginning July 1, 2026, no new contracts may be entered

into between the Medicaid office and an intermediate payor such as a managed care entity or other

form of health insurance company for the payment of healthcare services pursuant to this chapter,

unless it is owned by the state.

     40-8.4-10. Regulations.

     (a) The department of human services Medicaid director is authorized to promulgate any

regulations necessary to implement this chapter.

     (b) When promulgating any rule or regulation necessary to implement this chapter, or any

rule or regulation related to RIte Care, the department Medicaid director shall send the notice

referred to in § 42-35-3 and a true copy of the rule referred to in § 42-35-4 of the Rhode Island

administrative procedures act to each of the co-chairpersons of the permanent joint committee on

health care oversight established by § 40-8.4-14.

     40-8.4-12. RIte Share health insurance premium assistance program.

     (a) Basic RIte Share health insurance premium assistance program. Under the terms

of Section 1906 of Title XIX of the U.S. Social Security Act, 42 U.S.C. § 1396e, states are permitted

to pay a Medicaid-eligible person’s share of the costs for enrolling in employer-sponsored health

insurance (ESI) coverage if it is cost-effective to do so. Pursuant to the general assembly’s direction

in the Rhode Island health reform act of 2000, the Medicaid agency requested and obtained federal

approval under § 1916, 42 U.S.C. § 1396o, to establish the RIte Share premium assistance program

to subsidize the costs of enrolling Medicaid-eligible persons and families in employer-sponsored

health insurance plans that have been approved as meeting certain cost and coverage requirements.

The Medicaid agency also obtained, at the general assembly’s direction, federal authority to require

any such persons with access to ESI coverage to enroll as a condition of retaining eligibility

providing that doing so meets the criteria established in Title XIX for obtaining federal matching

funds.

     (b) Definitions. For the purposes of this section, the following definitions apply:

     (1) “Cost-effective” means that the portion of the ESI that the state would subsidize, as

well as wrap-around costs, would on average cost less to the state than enrolling that same

person/family in a managed-care delivery system.

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     (2) “Cost sharing” means any co-payments, deductibles, or co-insurance associated with

ESI.

     (3) “Employee premium” means the monthly premium share a person or family is required

to pay to the employer to obtain and maintain ESI coverage.

     (4) “Employer-sponsored insurance” or “ESI” means health insurance or a group health

plan offered to employees by an employer. This includes plans purchased by small employers

through the state health insurance marketplace, healthsource, RI (HSRI).

     (5) “Policy holder” means the person in the household with access to ESI, typically the

employee.

     (6) “RIte Share-approved employer-sponsored insurance (ESI)” means an employer-

sponsored health insurance plan that meets the coverage and cost-effectiveness criteria for RIte

Share.

     (7) “RIte Share buy-in” means the monthly amount an Medicaid-ineligible policy holder

must pay toward RIte Share-approved ESI that covers the Medicaid-eligible children, young adults,

or spouses with access to the ESI. The buy-in only applies in instances when household income is

above one hundred fifty percent (150%) of the FPL.

     (8) “RIte Share premium assistance program” means the Rhode Island Medicaid premium

assistance program in which the State pays the eligible Medicaid member’s share of the cost of

enrolling in a RIte Share-approved ESI plan. This allows the state to share the cost of the health

insurance coverage with the employer.

     (9) “RIte Share unit” means the entity within the executive office of health and human

services (EOHHS) responsible for assessing the cost-effectiveness of ESI, contacting employers

about ESI as appropriate, initiating the RIte Share enrollment and disenrollment process, handling

member communications, and managing the overall operations of the RIte Share program.

     (10) “Third-party liability (TPL)” means other health insurance coverage. This insurance

is in addition to Medicaid and is usually provided through an employer. Since Medicaid is always

the payer of last resort, the TPL is always the primary coverage.

     (11) “Wrap-around services or coverage” means any healthcare services not included in

the ESI plan that would have been covered had the Medicaid member been enrolled in a RIte Care

or Rhody Health Partners plan. Coverage of deductibles and co-insurance is included in the wrap.

Co-payments to providers are not covered as part of the wrap-around coverage.

     (c) RIte Share populations. Medicaid beneficiaries subject to eligible for RIte Share

include: children, families, parent and caretakers eligible for Medicaid or the children’s health

insurance program (CHIP) under this chapter or chapter 12.3 of title 42; and adults between the

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ages of nineteen (19) and sixty-four (64) who are eligible under chapter 8.12 of this title, not

receiving or eligible to receive Medicare, and are enrolled in managed care delivery systems. The

following conditions apply:

     (1) The income of Medicaid beneficiaries shall affect whether and in what manner they

must may participate in RIte Share as follows:

     (i) Income at or below one hundred fifty percent (150%) of FPL — Persons and families

determined to have household income at or below one hundred fifty percent (150%) of the federal

poverty level (FPL) guidelines based on the modified adjusted gross income (MAGI) standard or

other standard approved by the secretary are required to participate in RIte Share if a Medicaid-

eligible adult or parent/caretaker has access to cost-effective ESI. Enrolling in ESI through RIte

Share shall be a condition of maintaining Medicaid health coverage for any eligible adult with

access to such coverage.

     (ii) Income above one hundred fifty percent (150%) of FPL and policy holder is not

Medicaid-eligible — Premium assistance is available when the household includes Medicaid-

eligible members, but the ESI policy holder (typically a parent/caretaker, or spouse) is not eligible

for Medicaid. Premium assistance for parents/caretakers and other household members who are not

Medicaid-eligible may be provided in circumstances when enrollment of the Medicaid-eligible

family members in the approved ESI plan is contingent upon enrollment of the ineligible policy

holder and the executive office of health and human services (executive office) determines, based

on a methodology adopted for such purposes, that it is cost-effective to provide premium assistance

for family or spousal coverage.

     (d) RIte Share enrollment as not a condition of eligibility. RIte Share enrollment shall

be purely voluntary and shall never be a condition of eligibility for Medicaid. For Medicaid

beneficiaries over the age of nineteen (19), enrollment in RIte Share shall be a condition of

eligibility except as exempted below and by regulations promulgated by the executive office.

     (1) Medicaid-eligible children and young adults up to age nineteen (19) shall not be

required to enroll in a parent/caretaker relative’s ESI as a condition of maintaining Medicaid

eligibility if the person with access to RIte Share-approved ESI does not enroll as required. These

Medicaid-eligible children and young adults shall remain eligible for Medicaid and shall be

enrolled in a RIte Care plan.

     (2) There shall be a limited six-month (6) exemption from the mandatory enrollment

requirement for persons participating in the RI works program pursuant to chapter 5.2 of this title.

     (e) Approval of health insurance plans for premium assistance. The executive office of

health and human services shall adopt regulations providing for the approval of employer-based

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health insurance plans for premium assistance and shall approve employer-based health insurance

plans based on these regulations. In order for an employer-based health insurance plan to gain

approval, the executive office must determine that the benefits offered by the employer-based

health insurance plan are substantially similar in amount, scope, and duration to the benefits

provided to Medicaid-eligible persons enrolled in a Medicaid managed care plan, when the plan is

evaluated in conjunction with available supplemental benefits provided by the office. The office

shall obtain and make available to persons otherwise eligible for Medicaid identified in this section

as supplemental benefits those benefits not reasonably available under employer-based health

insurance plans that are required for Medicaid beneficiaries by state law or federal law or

regulation. Once it has been determined by the Medicaid agency that the ESI offered by a particular

employer is RIte Share-approved, all Medicaid members with access to that employer’s plan are

required to participate in RIte Share. Failure to meet the mandatory enrollment requirement shall

result in the termination of the Medicaid eligibility of the policy holder and other Medicaid

members nineteen (19) or older in the household who could be covered under the ESI until the

policy holder complies with the RIte Share enrollment procedures established by the executive

office.

     (f) Premium assistance. The executive office shall provide premium assistance by paying

all or a portion of the employee’s cost for covering the eligible person and/or his or her family

under such a RIte Share-approved ESI plan subject to the buy-in provisions in this section.

     (g) Buy-in. Persons who can afford it shall share in the cost. — The executive office is

authorized and directed to apply for and obtain any necessary state plan and/or waiver amendments

from the Secretary of the United States Department of Health and Human Services (DHHS) to

require that persons enrolled in a RIte Share-approved employer-based health plan who have

income equal to or greater than one hundred fifty percent (150%) of the FPL to buy-in to pay a

share of the costs based on the ability to pay, provided that the buy-in cost shall not exceed five

percent (5%) of the person’s annual income. The executive office shall implement the buy-in by

regulation, and shall consider co-payments, premium shares, or other reasonable means to do so.

     (h) Maximization of federal contribution. The executive office of health and human

services is authorized and directed to apply for and obtain federal approvals and waivers necessary

to maximize the federal contribution for provision of medical assistance coverage under this

section, including the authorization to amend the Title XXI state plan and to obtain any waivers

necessary to reduce barriers to provide premium assistance to recipients as provided for in Title

XXI of the Social Security Act, 42 U.S.C. § 1397aa et seq.

     (i) Implementation by regulation. The executive office of health and human services is

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authorized and directed to adopt regulations to ensure the establishment and implementation of the

premium assistance program in accordance with the intent and purpose of this section, the

requirements of Title XIX, Title XXI, and any approved federal waivers.

     (j) Outreach and reporting. The executive office of health and human services shall

develop a plan to identify Medicaid-eligible individuals who have access to employer-sponsored

insurance and increase the use of RIte Share benefits. Beginning October 1, 2019, the executive

office shall submit the plan to be included as part of the reporting requirements under § 35-17-1.

Starting January 1, 2020, the executive office of health and human services shall include the number

of Medicaid recipients with access to employer-sponsored insurance, the number of plans that did

not meet the cost-effectiveness criteria for RIte Share, and enrollment in the premium assistance

program as part of the reporting requirements under § 35-17-1.

     (k) Employer-sponsored insurance. The executive office of health and human services

shall dedicate staff and resources to reporting monthly as part of the requirements under § 35-17-1

which employer-sponsored insurance plans meet the cost-effectiveness criteria for RIte Share.

Information in the report shall be used for screening for Medicaid enrollment to encourage Rite

Share participation. By October 1, 2021, the report shall include any employers with 300 or more

employees. By January 1, 2022, the report shall include employers with 100 or more employees.

The January report shall also be provided to the chairperson of the house finance committee; the

chairperson of the senate finance committee; the house fiscal advisor; the senate fiscal advisor; and

the state budget officer.

     40-8.4-15. Advisory commission on health care.

     (a) There is hereby established an advisory commission to be known as the “advisory

commission on health care” to advise the director of the department of human services on all

matters relating to the RIte Care and RIte Share programs, and other matters concerning access for

all Rhode Islanders to quality health care in the most affordable, economical manner. The director

of the department of human services shall serve ex officio as chairperson. The director shall appoint

the eighteen (18) members:

     (1) Three (3) of whom shall represent the healthcare providers;

     (2) Three (3) of whom shall represent the healthcare insurers;

     (3) Three (3) of whom shall represent healthcare consumers or consumer organizations;

     (4) Two (2) of whom shall represent organized labor;

     (5) One of whom shall be the health care advocate in the office of the attorney general; and

     (6) Three (3) of whom shall represent employers; and

     (7) Three (3) Nine (9) of whom shall be other members of the public.

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     (b) The commission may study all aspects of the provisions of the RIte Care and RIte Share

programs involving purchasers of health care, including employers, consumers, and the state, health

insurers, providers of health care, and healthcare facilities, and all matters related to the interaction

among these groups, including methods to achieve more effective and timely resolution of disputes,

better communication, speedier, more reliable and less-costly administrative processes, claims,

payments, and other reimbursement matters, and the application of new processes or technologies

to such issues.

     (c) Members of the commission shall be appointed in the month of July, each to hold office

until the last day of June in the second year of his or her appointment or until his or her successor

is appointed by the director.

     (d) The commission shall meet at least quarterly, and the initial meeting of the commission

shall take place on or before September 15, 2000. The commission may meet more frequently than

quarterly at the call of the chair or at the call of any three (3) members of the commission.

     (e) Members of the permanent joint committee on health care oversight established

pursuant to § 40-8.4-14 shall be notified of each meeting of the commission and shall be invited to

participate.

     40-8.4-19. Managed healthcare delivery systems for families Cost sharing.

     (a) Notwithstanding any other provision of state law, the delivery and financing of the

healthcare services provided under this chapter shall be provided through a system of managed

care. “Managed care” is defined as systems that: integrate an efficient financing mechanism with

quality service delivery; provide a “medical home” to ensure appropriate care and deter

unnecessary services; and place emphasis on preventive and primary care.

     (b) Enrollment in managed care health delivery systems is mandatory for individuals

eligible for medical assistance under this chapter. This includes children in substitute care, children

receiving medical assistance through an adoption subsidy, and children eligible for medical

assistance based on their disability. Beneficiaries with third-party medical coverage or insurance

may be exempt from mandatory managed care in accordance with rules and regulations

promulgated by the department of human services for such purposes.

     (c) Individuals who can afford to contribute shall share in the cost. The department of

human services is authorized and directed to apply for and obtain any necessary waivers and/or

state plan amendments from the Secretary of the United States Department of Health and Human

Services, including, but not limited to, a waiver of the appropriate sections of Title XIX, 42 U.S.C.

§ 1396 et seq., to require that beneficiaries eligible under this chapter or chapter 12.3 of title 42,

with incomes equal to or greater than one hundred fifty percent (150%) of the federal poverty level,

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pay a share of the costs of health coverage based on the ability to pay. The department of human

services shall implement this cost-sharing obligation by regulation, and shall consider co-payments,

premium shares, or other reasonable means to do so in accordance with approved provisions of

appropriate waivers and/or state plan amendments approved by the Secretary of the United States

Department of Health and Human Services.

     SECTION 10. Section 40-8.4-13 of the General Laws in Chapter 40-8.4 entitled "Health

Care for Families" is hereby repealed.

     40-8.4-13. Utilization of available employer-based health insurance.

     To the extent permitted under Titles XIX and XXI of the Social Security Act, 42 U.S.C. §

1396 et seq. and 42 U.S.C. § 1397aa et seq., or by waiver from the Secretary of the United States

Department of Health and Human Services, the department of human services shall adopt

regulations to restrict eligibility for RIte Care under this chapter and/or chapter 12.3 of title 42, or

the RIte Share program under § 40-8.4-12, for certain periods of time for certain individuals or

families who have access to, or have refused or terminated employer-based health insurance and

for certain periods of time for certain individuals but not including children whose employer has

terminated their employer-based health insurance. The department is authorized and directed to

amend the medical assistance Title XIX and XXI state plans, and/or to seek and obtain appropriate

federal approvals or waivers to implement this section.

     SECTION 11. Sections 40-8.5-1 and 40-8.5-1.1 of the General Laws in Chapter 40-8.5

entitled "Health Care for Elderly and Disabled Residents Act" are hereby amended to read as

follows:

     40-8.5-1. Categorically needy medical assistance coverage.