Session of 2000
HOUSE BILL No. 2963
By Representatives Findley, Barnes, Burroughs, Crow,
Flaharty, Garner,
Gilbert,
Henderson, Kirk, McClure, McKechnie, O'Brien, Rehorn,
Ruff,
Sharp, Spangler, Storm, Swenson, Toelkes and Wells
2-9
13 AN ACT
concerning health care; establishing the managed care respon-
14 sibility act.
15
16 Be it enacted by the Legislature of the
State of Kansas:
17 Section
1. As used in this act:
18 (a) "Appropriate
and medically necessary" means the standard for
19 health care services as determined by
physicians and health care providers
20 in accordance with the prevailing practices
and standards of the medical
21 profession.
22 (b) "Emergency
service system" shall have the meaning ascribed to
23 it in K.S.A. 1999 Supp. 65-6112, and
amendments thereto.
24 (c) For the
purposes of this section, "emergency telephone service"
25 shall have the meaning ascribed to it in
K.S.A. 1999 Supp. 12-5301 and
26 amendments thereto.
27 (d) "Enrollee"
means an individual who is enrolled in a health benefit
28 plan, including covered dependents.
29 (e) "Health
benefit plan" shall have the means ascribed to it in K.S.A.
30 1999 Supp. 40-4602, and amendments
thereto.
31 (f) "Health care
treatment decision" means a determination made
32 when medical services are to be provided by
the health care plan and a
33 decision which affects the quality of the
diagnosis, care or treatment pro-
34 vided to any insured or enrollee of such
plan.
35 (g) "Health
insurer" shall have the meaning ascribed to it in K.S.A.
36 1999 Supp. 40-4602, and amendments
thereto.
37 (h) "Ordinary
care" means, in the case of a health insurer, that degree
38 of care that a health insurer of ordinary
prudence would use under the
39 same or similar circumstances. In the case
of a person who is an employee,
40 agent, ostensible agent, or representative
of a health insurer, "ordinary
41 care" means that degree of care that a
person of ordinary prudence in
42 the same profession, specialty or area of
practice as such person would
43 use in the same or similar
circumstances.
2
1
(i) "Physician" shall have the meaning ascribed to it in
K.S.A. 1999
2 Supp. 40-4602, and amendments
thereto.
3
(j) "Provider" shall have the meaning ascribed to it in K.S.A.
1999
4 Supp. 40-4602, and amendments
thereto.
5 Sec.
2. (a) A health insurer for a health benefit plan has the duty
to
6 exercise ordinary care when making
health care treatment decisions and
7 is liable for damages for harm to an
insured or enrollee caused by its
8 failure to exercise such ordinary
care.
9 (b) A
health insurer for a health benefit plan is also liable for
damages
10 for harm to an insured or enrollee caused
by the health care treatment
11 decisions made by its:
12
(1) Employees;
13 (2) agents;
14 (3) ostensible
agents; or
15
(4) representatives who are acting on its behalf and over whom
it has
16 the right to exercise influence or control
or has actually exercised influ-
17 ence or control which result in the failure
to exercise ordinary care.
18 (c) It shall be a
defense to any action asserted against a health insurer
19 for a health benefit plan that:
20 (1) Neither the
health insurer, nor any employee, agent, ostensible
21 agent, or representative for whose conduct
such health insurer is liable
22 under subsection (b), controlled,
influenced or participated in the health
23 care treatment decision; and
24 (2) the health
insurer did not deny or delay any treatment prescribed
25 or recommended by a provider to the insured
or enrollee.
26 (d) The standards
in subsections (a) and (b) create no obligation on
27 the part of the health insurer to provide
to an insured or enrollee treat-
28 ment which is not covered by the health
care benefit plan of the entity.
29 (e) This act does
not create any liability on the part of an employer,
30 an employer group purchasing organization,
or a pharmacy licensed under
31 K.S.A. 65-1626 et seq., and
amendments thereto, that purchases coverage
32 or assumes risk on behalf of its
employees.
33 (f) A health
insurer may not remove a provider from its plan or refuse
34 to renew the provider with its plan for
advocating on behalf of an enrollee
35 for appropriate and medically necessary
health care for the enrollee.
36 (g) A health
insurer shall not enter into a contract with a provider or
37 pharmaceutical company which includes an
indemnification or hold
38 harmless clause for the acts or conduct of
the health insurer. Any such
39 indemnification or hold harmless clause in
an existing contract is hereby
40 declared void as being against public
policy.
41 (h) Nothing in
any law of this state prohibiting a health insurer from
42 practicing medicine or being licensed to
practice medicine may be as-
43 serted as a defense by such health insurer
in an action brought against it
3
1 pursuant to this section or any other
law.
2 (i) In an
action against a health insurer, a finding that a physician or
3 other health benefit plan is an
employee, agent, ostensible agent, or rep-
4 resentative of such health insurer
shall not be based solely on proof that
5 such person's name appears in a
listing of participating providers made
6 available to any insured or enrollee
under a health benefit plan.
7 (j) This
act does not apply to workers' compensation insurance cov-
8 erage as defined in K.S.A. 44-501
et seq., and amendments thereto.
9 Sec.
3. (a) A person may not maintain a cause of action under
this
10 act against a health insurer that is
required to comply with the utilization
11 review requirements of K.S.A. 1999 Supp.
40-2213 through 40-2216, and
12 amendments thereto, unless the affected
insured or enrollee or the in-
13 sured's or enrollee's representative:
14 (1) Has exhausted
the appeals and review applicable under the util-
15 ization review requirements; or
16 (2) before
instituting the action:
17 (A) Gives written
notice of the claim as provided by subsection (b);
18 and
19 (B) agrees to
submit the claim to a review by an independent review
20 organization under K.S.A. 1999 Supp.
40-2213 through 40-2216, and
21 amendments thereto, as required by
subsection (c).
22 (b) The notice
required by paragraph (2) of subsection (a) shall be
23 delivered or mailed to the health insurer
against whom the action is made
24 not later than the 30th day before the date
the claim is filed.
25 (c) The insured
or enrollee or the insured's or enrollee's represen-
26 tative shall submit the claim to a review
by an independent review or-
27 ganization if the health insurer against
whom the claim is made requests
28 the review not later than the 14th day
after the date notice under para-
29 graph (2) of subsection (a) is received by
the health insurer. If the health
30 insurer does not request the review within
the period specified by this
31 subsection, the insured or enrollee or the
insured's or enrollee's repre-
32 sentative is not required to submit the
claim to independent review before
33 maintaining the action.
34 (d) A review
conducted under subsection (c) as requested by a health
35 insurer shall be performed in accordance
with K.S.A. 1999 Supp. 40-2213
36 through 40-2216, and amendments thereto.
The health insurer requesting
37 the review shall agree to comply with
K.S.A. 1999 Supp. 40-2213 through
38 40-2216, and amendments thereto.
39 (e) Subject to
subsection (f), if the enrollee has not complied with
40 subsection (a), an action under this
section shall not be dismissed by the
41 court, but the court may, in its
discretion, order the parties to submit to
42 an independent review or mediation or other
nonbinding alternative dis-
43 pute resolution and may abate the action
for a period of not to exceed 30
4
1 days for such purposes. Such orders
of the court shall be the sole remedy
2 available to a party complaining of
an enrollee's failure to comply with
3 subsection (a).
4 (f) The
enrollee is not required to comply with subsection (c) and no
5 abatement or other order pursuant to
subsection (e) for failure to comply
6 shall be imposed if the enrollee has
filed a pleading alleging in substance
7 that:
8 (1) Harm to
the enrollee has already occurred because of the conduct
9 of the health insurer or because of
an act or omission of an employee,
10 agent, ostensible agent, or representative
of such health insurer, as set
11 forth in subsection (b) of section 2, for
whose conduct it is liable; and
12 (2) the review
would not be beneficial to the enrollee, unless the
13 court, upon motion by a defendant health
insurer finds after hearing that
14 such pleading was not made in good faith,
in which case the court may
15 enter an order pursuant to subsection
(d).
16 (g) If the
insured or enrollee or the insured's or enrollee's represen-
17 tative seeks to exhaust the appeals and
review or provides notice, as re-
18 quired by subsection (a), before the
statute of limitations applicable to a
19 claim against a health insurer has expired,
the limitations period is tolled
20 until the later of:
21 (1) The 30th day
after the date the insured or enrollee or the insured's
22 or enrollee's representative has exhausted
the process for appeals and
23 review applicable under the utilization
review requirements; or
24 (2) the 40th day
after the date the insured or enrollee or the insured's
25 or enrollee's representative gives notice
under paragraph (2) of subsection
26 (a).
27 (h) This section
does not prohibit an insured or enrollee from pur-
28 suing any other appropriate remedy or
relief available under law, if the
29 requirement of exhausting the process for
appeal and review places the
30 insured's or enrollee's health in serious
jeopardy.
31 Sec. 4. The
provisions of sections 1 through 3 of this act shall apply
32 only to any cause of action which accrues
on and after the effective date
33 of this act. Any action which accrued prior
to the effective date of this
34 act shall be governed by the law applicable
to such cause of action on the
35 day preceding the effective date of this
act.
36 Sec. 5. (a)
For the purposes of this section, "emergency medical con-
37 dition" means a medical condition that
manifests itself by symptoms of
38 sufficient severity that the absence of
immediate medical attention could
39 reasonably be expected by a prudent
layperson, who possesses an average
40 knowledge of health and medicine, to result
in:
41 (1) Placing the
patient's health in serious jeopardy;
42 (2) serious
impairment to bodily functions; or
43 (3) serious
dysfunction of any bodily organ or part.
5
1 (b) No
health insurer shall require an insured or enrollee to obtain
2 prior authorization before accessing
the 911 system or any emergency
3 medical system for an emergency
medical condition.
4 (c) No
health insurer shall prohibit any insured or enrollee from ac-
5 cessing any emergency telephone
service or any emergency medical serv-
6 ice for an emergency medical
condition.
7 Sec.
6. This act shall be known and may be cited as the managed
8 care responsibility act.
9 Sec. 7. This act
shall take effect and be in force from and after its
10 publication in the statute book.