December 29, Knox-Keene Health Care Service Plan Act New Legislation California Code of Regulations - Title 28 - New Regulations.

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1 December 29, 2003 Re: Knx-Keene Health Care Service Plan Act New Legislatin Califrnia Cde f Regulatins - Title 28 - New Regulatins Dear Prvider: As a specialized behaviral health care service plan licensed under the Knx-Keene Act, ValueOptins f Califrnia, Inc. ( VOC r the Plan ) has implemented the requirements f several new Califrnia laws and regulatins. This bulletin prvides a summary f thse laws and regulatins that mst directly affect prviders and ur VOC members. Please nte that this summary nly reflects thse requirements that represent new changes. It des nt address thse prtins f the affected law and regulatins that are unchanged r thse laws and regulatins r prtins f the law and regulatins nt applicable t VOC. Several f these new laws and regulatins require that VOC amend its current cntracts with prviders. These mdificatins are described in the attached Ntice Amendment t all VOC prvider cntracts. This includes Practitiner, Facility, and Grup Prvider Agreements fr prviders participating in the ValueOptins f Califrnia mental health and substance abuse ( MHSA ) netwrks and prfessinals participating under the Emplyee Assistance Prgram ( EAP ) Affiliate Agreement. These cntract amendments are effective January 1, The attached Amendment des nt apply t cntracts a prvider may have with the Plan s parent, ValueOptins, Inc. If yu have questins r need mre infrmatin regarding VOC s implementatin f these new laws and regulatins, please cntact Prvider Relatins at (562) Attachments Ntice Amendment t Practitiner, Facility, Grup Prvider, and Emplyee Assistance Prgram Affiliate Agreements G l d e n S h r e, L n g B e a c h, C a l i f r n i a P h ( ) F a x ( )

2 AB 88 and Califrnia Cde f Regulatins Title 28, Sectin Mental Health Parity The Department f Managed Health Care ( DMHC ) adpted a regulatin effective Octber 23, 2003 that implemented certain statutry requirements fr cverage f mental illness. This regulatin is related t AB 88 which was effective July 1, 2000 and establishes prvisins fr the administratin f mental health parity cverage by full service health care service plans. One prvisin in this regulatin adds additinal clarificatin t ne f the cnditins included in the Severe Mental Illness categry. VOC s current Practitiner and Facility Agreements with MHSA netwrk prviders include the fllwing definitin f Severe Mental Illness : Severe Mental Illness (SMI) includes the diagnsis and Medically Necessary treatment f the fllwing cnditins: Anrexia Nervsa Panic Disrder Biplar Disrder Pervasive Develpmental Disrder Bulimia Nervsa Schizaffective Disrder Majr Depressive Disrder Schizphrenia Obsessive-Cmpulsive Disrder Sectin further clarifies that the Pervasive Develpmental Disrder cnditin includes Autistic Disrder, Rett s Disrder, Childhd Disintegrative Disrder, Asperger s Disrder and Pervasive Develpmental Disrder nt therwise specified, including Atypical Autism. This clarificatin is being prvided fr infrmatin purpses and des nt require a change t the definitins in the Plan s prvider agreements. VOC will autmatically cnsider this definitin clarificatin in its review f services under the mental health parity benefit. This change des nt affect services prvided by the Plan s EAP prvider netwrk. AB Cntinuity f Care This law that replaces previus laws is effective January 1, 2004 and expands the categries f cnditins and the time perid fr which VOC must ensure a cntinuity f care ptin available t members. This law requires the Plan t arrange fr the cntinuatin f cvered services frm a terminated prvider r nnparticipating prvider if the member qualifies under ne f several specified categries and is receiving services frm the terminated prvider at the time f the prvider cntract terminatin r is receiving services frm a nn-participating prvider at the time when the new member s emplyer changed health plans. The requirements f this law that directly affect VOC cntracted MHSA and EAP prviders are addressed in the attached Ntice Amendment t the VOC prvider cntracts. AB Prvider Cntracts ( Prvider Bill f Rights ) This law prhibits health care plans frm including prvisins in prvider cntracts that wuld allw a plan t unilaterally change a material term f the cntract withut meeting specified requirements. Specifically, VOC must send prviders written ntice frty-five (45) business days prir t a change in a material term f the prvider cntracts and the change is subject t negtiatin and agreement by the prvider unless the amendment is necessary t cmply with a change in state r federal law r regulatin r accreditatin standards. This law als applies t prvisins related t changes t prvider manuals, plicies and prcedures that are referenced in the cntract. This law als gives prviders the right t terminate their cntract with VOC prir t the implementatin f the prpsed change if the Plan and prvider cannt agree t the change. The requirements f this law which directly affect VOC cntracted MHSA and EAP prviders are addressed in the attached Ntice Amendment t the VOC prvider cntracts. 1

3 AB 1455 and Califrnia Cde f Regulatins Title 28, Sectins and Claims Settlement Practices and Prvider Dispute Reslutin Mechanism The DMHC adpted regulatins effective August 25, 2003 that implemented certain statutry requirements related t AB 1455 which was effective January 1, These regulatins address claim settlement practices and the prcess fr reslving prvider disputes and all health care plans are required t cmply with these regulatins as f January 1, The regulatins require VOC t prvide the infrmatin belw t all cntracted MHSA and EAP prviders. The infrmatin belw related t new requirements in claim regulatins applies t all claims (and disputes related t thse claims) fr services rendered n r after January 1, Cpies f claim settlement and prvider dispute plicies, frms, and instructins are available starting January 1, 2004 n VOC s website which may be accessed at and then click n the Reginal Fcus link fllwed by the VOC link. Cntracted prviders may als request a cpy f the claim settlement and prvider dispute plicies, frms, and instructins referenced in the infrmatin belw by submitting a written request t the VOC Prvider Relatins Department at 340 Glden Shre, Lng Beach, Califrnia Certain requirements f this law which directly affect VOC cntracted MHSA and EAP prviders are addressed in the attached Ntice Amendment t the VOC prvider cntracts. Claim Submissin Instructins Claim Submissin Addresses: Claims fr cvered services prvided t members must be sent t the attentin f the VOC Claims Department at the fllwing: Via Mail: 340 Glden Shre, Lng Beach, Califrnia Via Physical Delivery: 340 Glden Shre, Lng Beach, Califrnia Via Website (electrnic): The prvider creates a HIPAA cmpliant 837 I/P file using their practice management sftware (PMS). If the prvider des nt wn a PMS, then the prvider can use ValueOptins EDI Claims Link fr Windws sftware which is prvided free t cntracted netwrk prviders. After data entry is cmplete, the prvider lgs nt the ValueOptins secure website and uplads the file. If the prvider des nt have access t the Internet, they can use the bulletin bard system (BBS) t uplad the file t ValueOptins. Once the file is received, the file is systematically validated t ensure that it is HIPAA cmpliant. The validatin checks bth the structure f the file as well as the cdes t ensure that the prvider is nly using industry standard cdes. Any HIPAA validatin errrs are lgged. The prvider can review the file validatin errrs either by lgging nt the website r by reviewing the errr reprt n the BBS. If an errr des ccur, the entire electrnic claim file is rejected. Files that pass HIPAA validatin are laded t the VOC claims system and an aut-adjudicatin prcess is initiated. Telephne Number Regarding Claims: Fr claim filing requirements r status inquiries, prviders may cntact VOC by calling the client specific telephne number n the member s identificatin card r by calling (866) Claim Submissin Requirements: The fllwing is a list f claim timeliness requirements, claims supplemental infrmatin and claims dcumentatin required by VOC. Claims must be submitted t VOC within 90 days fr cntracted prviders and 180 days fr nncntracted prviders after the date f service. 2

4 Claims fr EAP services must be submitted n a VOC EAP Affiliate Billing Frm and accmpanied by a VOC EAP Case Activity Frm. Claims fr MHSA services must be submitted n a cmpleted CMS Frm 1500 (fr prfessinal practitiners) and a cmpleted UB92 frmat (fr institutinal prviders) r in the equivalent electrnic frmats fr bth frms. Claim Receipt Verificatin: Fr verificatin f EAP and MHSA claim receipt and the recrded date f receipt by VOC please use ne f the fllwing methds, as applicable: Website Submitted Claims: Receipt f claims submitted electrnically via the website will be acknwledged by sending an t the submitter s cntact address n file and the status is als psted t the claims website. Cnfirmatin is usually available within a few minutes t 3 hurs frm receipt, but n later than tw (2) wrking days, depending n the vlume f claim files electrnically submitted. Paper Claims: Receipt f paper claims submitted by mail r physical delivery can be cnfirmed by calling VOC at the telephne numbers listed fr claim status inquiries abve. Cnfirmatin is available n later than within fifteen (15) wrking days f VOC s receipt f the claim. Dispute Reslutin Prcess fr Prviders VOC has a prvider dispute reslutin prcess that is intended t prvide fr the fast, fair and cst-effective reslutin f prvider disputes. The prvider dispute reslutin prcess is handled under the versight f the VOC Vice President f Operatins. The infrmatin belw applies t bth cntracted and nn-cntracted prvider disputes unless therwise nted. Definitin f Cntracted Prvider Dispute: A cntracted prvider dispute is a prvider s written ntice t VOC challenging, appealing r requesting recnsideratin f a claim (r a bundled grup f substantially similar multiple claims that are individually numbered) that has been denied, adjusted r cntested r seeking reslutin f a billing determinatin r ther cntract dispute (r bundled grup f substantially similar multiple billing r ther cntractual disputes that are individually numbered) r disputing a request fr reimbursement f an verpayment f a claim. Definitin f Nn-Cntracted Prvider Dispute: A nn-cntracted prvider dispute means a nn-cntracted prvider s written ntice t VOC challenging, appealing r requesting recnsideratin f a claim (r a bundled grup f substantially similar claims that are individually numbered) that has been denied, adjusted r cntested r disputing a request fr reimbursement f an verpayment f a claim. Prvider Dispute Submissin Requirements: Califrnia regulatins mandate specific prvider dispute submissin requirements. Each prvider dispute must cntain, at a minimum the fllwing infrmatin: 1. All prvider disputes must include: Prvider s name; Prvider s tax identificatin number; Prvider s cntact infrmatin; and The infrmatin in items 2 thrugh 5 belw, as applicable t the type f dispute. 2. Disputes cncerning a claim r a VOC request fr reimbursement f an verpayment f a claim must include: 3

5 ValueOptins f Califrnia A clear identificatin f the disputed item, including the riginal claim number, The date f service, and A clear explanatin f the basis upn which the prvider believes the payment amunt, request fr additinal infrmatin, request fr reimbursement fr the verpayment f a claim, cntest, denial, adjustment r ther VOC actin is incrrect; 3. Cntracted prvider disputes that are nt abut a claim (e.g. cntract issues) must include: A clear explanatin f the issue and The prvider s psitin n such issue. 4. Disputes invlving a member r grup f members must include: The name and identificatin number(s) f each member, A clear explanatin f the disputed item, including the date f service, and Prvider s psitin n the dispute. 5. Prviders may file substantially similar multiple claims, billing r cntractual disputes, in batches as a single dispute, prvided that such disputes include the infrmatin described abve. VOC recmmends that disputes filed in batches be submitted in the fllwing frmat: Srt disputes by similar issue Prvide cver sheet (sample will be n the website) fr each batch f like issues (individually number and list the infrmatin required in the sectin abve fr each disputed item within the batch, as applicable) Number each cver sheet Prvide a cver letter r frm (n the website) fr the entire submissin describing each prvider dispute with references t the numbered cversheets 6. Prvider disputes that d nt include all required infrmatin as listed abve may be returned t the submitter fr cmpletin if the infrmatin is in the pssessin f the prvider and is nt readily accessible t VOC. Disputes Submitted n behalf f VOC members: Any prvider dispute submitted n behalf f a member r a grup f members treated by the prvider (e.g. a clinical appeal f a UM certificatin decisin, a clinical dispute during the cncurrent care review prcess, prvider is attempting t get an expedited review n behalf f member meeting urgent grievance definitin, etc.) will be handled in the VOC cnsumer grievance prcess and nt in the Plan s prvider s dispute reslutin mechanism. VOC may verify the member s authrizatin t prceed with the grievance prir t submitting the cmplaint t the Plan s cnsumer grievance prcess. When a prvider submits a dispute n behalf f a member r a grup f members, the prvider shall be deemed t be jining with r assisting the member within the meaning f sectin 1368 f the Health and Safety Cde. Sample prvider dispute frms fr submissin f individual r multiple disputes and additinal infrmatin regarding VOC s Prvider Dispute prcess may be fund by visiting the prvider site at Detailed instructins and frms may be accessed by clicking n the Reginal Fcus link then the VOC link. Prvider Dispute Submissin Addresses: Prvider Disputes must be sent t the attentin f the VOC Prvider Dispute Department at the fllwing: Via Mail: 340 Glden Shre, Lng Beach, Califrnia Via Physical Delivery: 340 Glden Shre, Lng Beach, Califrnia Via PrviderDisputes@valueptins.cm 4

6 Via Fax: (562) Time Perid fr Submissin f Prvider Disputes: Prvider disputes fr an individual claim, billing dispute, r ther cntractual dispute, r disputes related t demnstrable and unfair Plan payment patterns must be received by VOC within 365 days frm the date f the Plan actin (r the mst recent Plan actin if there are multiple actins) that led t the dispute. (Example: A disputed claim decisin must be submitted within 365 days frm the date n the Plan s Prvider Summary Vucher.) Prvider disputes fr an individual claim, billing dispute, r ther cntractual dispute, r disputes related t demnstrable and unfair Plan payment patterns invlving inactin n the part f VOC must be received by VOC within 365 days after the Plan s mst recent time fr cntesting r denying claims has expired. (E.g. The Plan has 30 wrking days frm receipt f a claim t cntest, deny, r reimburse a claim. If the Plan has nt ntified the prvider f ne f these actins within 30 wrking days f receipt f the mst recent claim invlved in the dispute issue, then the prvider may file a dispute within 365 days after the expiratin f that 30 wrking day perid.) Prvider disputes regarding a Plan ntice f verpayment must be submitted by the prvider within 30 wrking days f the receipt f the ntice f verpayment f a claim. Prviders may submit an amended prvider dispute within thirty (30) wrking days f their receipt f a prvider dispute that has been returned t the submitter fr cmpletin f infrmatin in the pssessin f the prvider and nt readily accessible t VOC. The amended prvider dispute must include the missing infrmatin identified in VOC s written ntice accmpanying the returned prvider dispute. Acknwledgment f Prvider Disputes: VOC will send written acknwledgement f receipt f all EAP and MHSA prvider disputes as fllws: Electrnic Prvider Disputes: Receipt f disputes submitted by direct (nt thrugh website) will be cnfirmed in writing within tw (2) wrking days r sner f VOC receipt. Submissin f disputes via the Plan website is nt currently available. Paper Prvider Disputes: Receipt f paper disputes submitted by facsimile, mail r physical delivery will be cnfirmed in writing within fifteen (15) wrking days r sner f VOC receipt. Telephne Number Regarding Prvider Disputes: Fr prvider dispute filing requirements r status inquiries, yu may cntact VOC by calling the client specific telephne number n the member s identificatin card r by calling (866) Time Perid fr Reslutin and Written Determinatin f Prvider Dispute: VOC will issue a written determinatin stating the pertinent facts and explaining the reasns fr its determinatin within frty-five (45) wrking days after the date VOC receives the prvider dispute r the amended prvider dispute. If the cntracted prvider dispute r amended cntracted prvider dispute invlves a claim and is determined in whle r in part in favr f the prvider, VOC will pay any utstanding mnies determined t be due, and all interest and penalties required by law r regulatin, within five (5) wrking days f the issuance f the written determinatin. 5

7 Fee Schedules and Other Required Infrmatin. ValueOptins f Califrnia In additin t the claim settlement and dispute reslutin ntice requirements, the AB 1455 Regulatins als set frth certain ntice requirements related t fee schedules and ther infrmatin that VOC must prvide t cntracted prviders. The infrmatin VOC is required t make available t cntracted prviders includes the fllwing: The cmplete fee schedule fr the cntracting prvider including the amunt f payment fr each and every service t be prvided under the cntract, including any fee schedules r ther factrs r units used in determining the fees fr each and every service. When VOC cntracts with a prvider a specified fee schedule fr each and every service t be prvided under the cntract is included as an attachment t the cntract. Detailed payment plicies and rules and nn-standard cding methdlgies defined in the regulatins, as applicable t VOC, if used t adjudicate claims. Any detailed payment plicies, rules and nn-standard cding methdlgies that are determined t be applicable t VOC and if used t adjudicate claims will be available starting January 1, 2004 n VOC s website which may be accessed as described abve. Mdificatins t the Claims Settlement and Prvider Dispute Reslutin Infrmatin fr Cntracting Prviders and t the Fee Schedules and Other Required Infrmatin: VOC will prvide a minimum f 45 days prir written ntice t cntracted prviders befre instituting any changes, amendments r mdificatins in the disclsures made abve r psting any such changes t the infrmatin n the website related t the disclsures made abve. 6