Rhode Island

SUMMARY

In the 2017 legislative session, Rhode Island passed legislation improving price transparency by requiring hospitals to provide patients with a cost estimate of the anticipated services. However, a number of other initiatives designed to contain health care costs for health care consumers failed to pass. Two bills sought to directly set the prices health care providers can bill patients for their health care records. Another bill aimed to improve health care transparency by studying and analyzing patient liability health plans and by requiring health insurers to make their plans’ assessment, restriction, and utilization information available on their websites.

In the current session, Rhode Island has introduced a bill that would allow small business owners to purchase health plans offered by their State Exchange. Rhode Island is seeking a 1332 State Innovation waiver in conjunction with this bill.

 

LEGISLATION/REGULATION

Legislative Calendar

Rhode Island’s current regular legislative session runs from 1/2/2018 – 6/30/2018.

 

Recent Legislative Developments

Healthcare Transparency

2018 H7004 RELATING TO BUSINESSES AND PROFESSIONS – PHARMACEUTICAL COST TRANSPARENCY. This act would direct the state board of pharmacy, in collaboration with the department of health, to annually identify up to fifteen (15) prescription drugs on which the state spends significant health care dollars due to increases in costs. This list would be provided to the attorney general’s office, and the attorney general‘s office would require the drug’s manufacturers to submit relevant information and documentation to justify these cost increases. The act would also direct the department of health to use the same dispensing fee in its reimbursement formula for 340B prescription drugs as it uses to pay for non-340B prescription drugs under the Medicaid, program, and to provide information to the general assembly and the governor about these programs. The act would also establish an advisory commission on out-of-pocket prescription drug costs who would study these costs and make reports and recommendations to the governor and the general assembly. Active – House Corporations Committee recommended measure be held for further study on 1/23/18.
H7042 RELATING TO BUSINESSES AND PROFESSIONS — PHARMACIES: Directs the state board of pharmacy to annually develop a list of critical prescription drugs for which there is a substantial public interest in understanding the development of the drugs’ price. Active –Committee recommended measure be held for further study­ 2/13/18
H7706 RELATING TO BUSINESSES AND PROFESSIONS – PRESCRIPTION DRUG SALES – REPRESENTATIVE DISCLOSURE ACT: Requires prescription drug manufacturers to file a detailed, updated list of each pharmaceutical sales representative and to pay an annual fee for each name listed with the department of business regulation. Active –Committee recommended measure be held for further study 4/4/18.
S2406 RELATING TO BUSINESSES AND PROFESSIONS – PHARMACIES – INSURANCE – PRESCRIPTION DRUG BENEFITS. Establishes rights pursuant to pharmacist-patient relationship. This bill would allow pharmacy benefit managers and pharmacies to provide information regarding the cost share amount and the clinical efficacy of a lower-priced alternative drug if one is available. Active –Committee recommended measure be held for further study­3/1/18.
2017 S0146

 

 

LICENSING OF HEALTH CARE FACILITIES: would require that a hospital provide to a prospective patient, the requested cost estimate of their requested anticipated hospital services within five business days of request and the cost of any facility fee. Passed—6/29/2017. Section 23-17-61 in Chapter 23-17 of Licensing of Health-care Facilities

 

Healthcare Cost

2018 S2077 UNANTICIPATED OUT-OF-NETWORK CARE: Protects people with health insurance from surprise medical bills for emergency and other services by requiring a non-participating health care provider to bill an insured party only for a co-payment, or deductible. Active – Meeting postponed 4/12/18.
H7372 RELATING TO BUSINESSES AND PROFESSIONS – PHARMACIES: Requires pharmacies to accept any manufacturer’s drug discount card, and pass said discount to the consumer, without requiring the consumer to seek reimbursement from the drug manufacturer directly. Active – Committee recommended measure be held for further study 4/4/18.
H7022 RELATING TO COMMERCIAL LAW–GENERAL REGULATORY PROVISIONS — UNFAIR SALES PRACTICES: Prohibits price-gouging of prescribed drugs or pharmaceuticals in times of market emergency or market shortages and makes violators guilty of a felony and subject to injunctive relief. Active – Committee recommended measure be held for further study­ 1/23/18.
2017 H5102

 

 

SURPRISE BILLS FOR MEDICAL SERVICES: would provide for a dispute resolution for emergency services and surprise bills for medical services performed by nonparticipating (out-of-network) healthcare providers. Failed.
H5109

 

 

RELATING TO INSURANCE: would prohibit insurance companies from varying the premium rates charged for a health coverage  based on the gender of the individual policy holder, enrollee, subscriber, or member Failed.

 

Healthcare Markets

2018 S2019 RHODE ISLAND HEALTH BENEFIT EXCHANGE: Authorizes Rhode Island Health Exchange to seek waiver under Affordable Care Act to allow small business owners/sole proprietors to purchase health plans offered by Rhode Island Health Exchange. Active – Referred to Senate Health & Human Services on 1/11/18.
S2237 RELATING TO HEALTH AND SAFETY — COMPREHENSIVE HEALTH INSURANCE PROGRAM. This act would repeal the “Rhode Island Health Care Reform Act of 2004 – Health Insurance Oversight” as well as the “Rhode Island Health Benefit Exchange.” This act would also establish a universal, comprehensive, affordable single-payer health care insurance program and help control health care 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 due to 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. Active – Committee recommended measure be held back for further study­ 4/3/18.
S2399 RELATING TO INSURANCE — ACCIDENT AND SICKNESS INSURANCE POLICIES: Prohibits insurance companies from varying the premium rates charged for a health coverage plan based on the gender of the individual policy holder, enrollee, subscriber, or member. Active –Referred to House 4/4/18.
2017 S0619

 

 

COMPREHENSIVE HEALTH INSURANCE PROGRAM: would repeal the “Rhode Island Health Care Reform Act of 2004—Health Insurance Oversight” as well as the “Rhode Island Health Benefit Exchange.” This bill would also establish the Rhode Island comprehensive health insurance program (RCHIP) of which all Rhode Island residents would be eligible to be covered. Failed.

 

Key Statutes

We compile state statutes relate to healthcare price and competition, including healthcare transparency, markets, and costs. For a complete listing of all health related statutes visit the State Health Practice Database for Research.

Healthcare Transparency

  • Gen. Law §23-17-61 requires that a hospital provide to a prospective patient, the requested cost estimate of their requested anticipated hospital services within five business days of request and the cost of any facility fee.

 

  • I. Gen. Laws. § 23-17.17-1 through 23-17.17-11, requires the establishment of a healthcare quality performance measurement and reporting program by the Director of Health for health facilities licensed in Rhode Island. The Director must issue an annual report including information “on trends in health care quality performance measures, identify areas for quality improvement initiatives, and program plans and objectives for future years.” The measure also creates a Health Care Quality Steering Committee; a health care quality and value database to make transparent healthcare price information available to consumers; and includes reporting requirements for insurers, health care providers, facilities and governmental agencies to furnish information for the health care databases. The database project, dubbed the Rhode Island All Payer Claims Databases (RI-APCD), began gathering data in January 2014.

 

  • I. Gen. Laws. § 23-17-19.1, respecting the rights of patients vis-à-vis health care facilities licensed by the state, a patient may request the identity of all health care practitioners that the facility has authorized to participate in the patient’s treatment, may request to see the bill and have it explained to him, and shall be presented with an itemized copy of the bill within 30 days of discharge.

 

  • I. Gen. Laws. § 23-17.13-3, under the “Health Care Accessibility and Quality Assurance Act,” provides for the certification criteria of health plans, including: standard definitions for health insurance terms; required disclosures to enrollees, including coverage and benefit limitations; prohibitions against inducements for providers to limit treatment for covered services; and a prohibition against a most favored rate clause in a provider contract. A most favored rate clause (sometimes most-favored nation clause) is a provision in a provider contract whereby the rates or fees to be paid by a health plan are set to be equal to or lower than the rates or fees paid to the provider by any other health plan or third party payer, which can be anti-competitive by preventing other insurers from competing on price.

 

Healthcare Markets

  • I. Gen. Laws. § 42-14.5-1 through 42-14.5-4: creates a Health Insurance Commissioner under the Department of Business Regulation to: “(1) Guard the solvency of health insurers; (2) Protect the interests of consumers; (3) Encourage fair treatment of health care providers; (4) Encourage policies and developments that improve the quality and efficiency of health care service delivery and outcomes; and (5) View the health care system as a comprehensive entity and encourage and direct insurers towards policies that advance the welfare of the public through overall efficiency, improved health care quality, and appropriate access.”

 

  • I. Gen. Laws. § 23-81-1 through 23-81-6: establishes the Rhode Island health care planning and accountability advisory council, comprised of members of government and the health care community, with duties to do the following: recommend a unified health plan for the state; assess alternative health care payment models; measure quality and appropriate utilization of health care services; plan for technological innovation; recommend legislation; issue reports on the state’s primary care workforce; and advise the governor, among other responsibilities.

 

  • I. Gen. Laws. § 23-17.14-1 through 23-17.14-34: the “Hospital Conversions Act,” recognizing that the conversion of non-profit hospitals into for-profit entities and the integration of providers through networks and mergers are affecting competition, cost and quality of health, requires that a hospital must obtain prior approval from the Department of Health and the Attorney General before conversion. The review criteria looks at, among other things, the effect on the community’s access to affordable care and “[w]hether the conversion demonstrates that the public interest will be served considering the essential medical services needed to provide safe and adequate treatment, appropriate access and balanced health care delivery to the residents of the state.”

 

  • I. Gen. Laws. § 23-17.22-2: the “Healthy Rhode Island Reform Act of 2008,” creates a healthy Rhode Island five year strategic plan to be developed by the Director of Health in consultation with the health care planning and accountability advisory council. The plan, focused on chronic care management, would implement the Rhode Island model, “which includes patient self-management, emphasis on primary care, community initiatives, and health system and information technology reform, to be used uniformly statewide by private insurers, third party administrators, and public programs,” with coordinate reform in reimbursement systems to improve outcomes and the quality of care.

 

  • I. Gen. Laws. § 27-18-8: requires prior approval for insurance policy forms and rate filings prior to use in the state of Rhode Island.

 

 

  • I. Gen. Laws. § 23-17-28: authorizes a health care facility to enter into agreement with other facilities, third-party payers, and branches of government for the purpose of reducing, limiting, or containing health care costs and improving the efficiency with which health care services are delivered.

 

  • I. Gen. Laws. § 23-15-1 through 23-15-11: the “Health Care Certificate of Need Act of Rhode Island,” creates the state’s Certificate of Need (CON) program. A healthcare provider must obtain a Certificate of Need through a regulatory process with the state when it seeks to offer new or expanded facilities or services, increasing the regulatory burden on new market-entrants but also giving the state a tool to provide for cost containment within the industry.

 

  • I. Gen. Laws. § 27-67-1 through 27-67-4: requires that the health insurance commissioner to issue a report to the general assembly addressing whether health insurers licensed in other New England states can automatically obtain licensure in Rhode Island in order to create a regional health insurance market.

 

 

 

LITIAGTION/ENFORCEMENT

  • Rhode Island Attorney General’s review documents of current and past hospital conversions can be found here.

 

  • On June 4, 2013, Steward Health Care System, LLC, Blackstone Medical Center, Inc., and Blackstone Rehabilitation Hospital, Inc. filed a complaint in federal district court, alleging that the Defendant, Blue Cross & Blue Shield of Rhode Island, violated state and federal antitrust law, and tortiously interfered with contractual relations, by engaging in a series of anticompetitive steps designed to block Steward’s acquisition of Landmark and its entry into the Rhode Island markets for the sale of commercial health insurance and the purchase of commercial hospital services. In response, Blue Cross contended that it acted legally when it refused to accept the reimbursement rates at Landmark that Steward was offering, and otherwise operated within its rights in order to promote its business interests. The federal court, on February 19. 2014, denied the defendants’ motion to dismiss the case. The plaintiffs in California putative class action Sidibe v. Sutter cited to this court’s denial in arguing against Sutter’s motion to dismiss in that case. The Source is following developments in these two private actions, and both are currently in discovery as of December 2016.

 

KEY RESOURCES

Rhode Island State General Assembly

Rhode Island Office of the Attorney General

Rhode Island State Department of Business Regulation

Rhode Island Office of the Health Insurance Commissioner

Rhode Island Department of Health