H.B. 566 Health Care Transparency Amendments: transcript

You, Mr. Chair. So HB 56, um, and I'll be speaking to the first substitute. It's, it's Healthcare Transparency Amendments. And this, this bill really is about transparency. So Medicaid plays a major role in the healthcare of our nation, um, representing almost $1 of out of every five spent on healthcare in the United States. Managed care is, is contracted with contrasted with fee for service as a method for reimbursing. Um, about 11% of Utahans are enrolled in Medicaid, and about 80 plus percent are on this managed care, um, managed care organization, manage for the management. And then the rest is the fee for service. Um, so the goals, um, the goal of managed care was that, um, it would help spread the risk out for the state, right? So as, as we've had managed care systems since 1982, there's limited data to show how successful those have been. Is there, are we being good stewards of the public dollars? This bill will help establish a set of transparency requirements for Utah's Medicaid managed organ organizations. Um, and I have with me, um, Nicholas Klein Worth. He is with the Paragonah Institute and he has done a lot of work in helping me with the this bill. And so I'm gonna give him a couple minutes to go through why we're doing this.

Thank you, Mr. Chairman and, uh, Representative Hall and members of the committee. Um, as Representative Hall mentioned, this bill is about providing, uh, transparency in Utah's Medicaid program, uh, that is necessary for good governance by DHHS, the legislature and the taxpayers, uh, to go through the sections of the bill. Um, I want to, we'll start with the definitions. Um, this bill, we, we put a lot of energy into making sure that, um, the, the, uh, managed care organizations are, are well defined, um, in, uh, the state of Utah, you have a lot of different types of managed care organizations. Managed care organization is the umbrella term that we're using in this legislation. So that refers to the ACOs, the prepaid mental health plans, uh, substance use disorder plans, the home program, mitigate integrated care, dental and chip. Um, we also spend a lot of time defining the relationships with the MCOs that includes related parties, affiliated persons and subcontractors, um, and focus a lot on improper payments. Um, which encompasses payments made in error by omission, um, that are unsubstantiated by medical evidence or, uh, spent, uh, for payments made on behalf of ineligible people. Uh, and of course, uh, for, for the sake of transparency, um, we find the, the challenge with managed care organizations is that there's sort of a black box for the Medicaid program. Um, a lot of information is hidden once it, the money leaves the state and goes into a managed care organization. Um, and so little is actually known about how managed care organizations pay out benefits and how they operate. And so the idea behind this bill is to just allow more visibility into that. Um, focusing on the, uh, section two, specifically on transparency reporting. Uh, this bill requires, uh, managed care organizations to report to DHHS, um, and to the division to, uh, publicly post this data in easily accessible online format on a quarterly basis. Um, it focuses on claim spending and, um, helps us gauge quality utilization and spending, um, from the MCOs and their subcontractors. Um, it also ensures that anything that the managed care organizations are reporting directly to Washington DC are also visible to the state DHHS and to, uh, the public as well. Um, in section three, we talk about auditing. Um, this section simply focuses on making sure that there are in truly independent audits done on managed care organizations, um, particularly with their finances, but also, uh, with the subcontractors that they're working with, um, as they pertain to Medicaid program. Um, section four deals with improper payments. Uh, current procedures, uh, actually don't, uh, look at improper payments very carefully as they, uh, relate to managed care organizations. Um, the current improper payment process merely looks at whether or not the state actually paid the MCO correctly, but it doesn't look at how the MCO paid the providers. Um, and so, um, in identifying improper payments is critical to ensure that not only the providers are paid correctly, um, but the patients also receive the right services. And this is different from the, uh, current MCO quality strategy that DHHS has. Um, and this would be done on a quarterly basis as well. Um, section five deals with actuary conflicts of interest, and all this section does is it ensures that when the state contracts for an actuary to set the rate that is paid to the MCO for a particular service in the Medicaid program, that that actuary isn't already doing business with the MCO as it pertains to the Medicaid program to ensure that, uh, those parties are truly independent. Um, and when they're making that resetting. Okay, great. Thank you for, that's walking through the specifics of the bill. Again, as we have been developing this, we've had those stakeholder meetings with everyone. We will still have more, we have one that I'm gonna schedule tomorrow, um, as well as we're kind of working through all the language. Again, this is about transparency and just making sure as we're looking at our managed care organizations and Medicaid in general, are we getting, are we being fiscally responsible to the taxpayers? And that's the bill. I'm happy to answer questions. Okay.

Thank you, Mr. Chair. Just a quick question. So on the, on the handout that you passed out, looks like there's a couple of states that don't, don't have, or, or very, uh, di minimis usage of MCOs. What happens in those states?

Uh, thank you Mr. Chairman. Uh, Representative Clancy, um, those states use a fee for service system. So in the state of Utah, we've contracted with an insurance company to manage, uh, the Medicaid population. But those states do all those services in house instead.

Got it. Thank you. And then a question from

Thank you. So we do actuarily certify the rate each year here in Utah. Is it your, you or to the sponsor? Understanding that the actuary we use is not independent. Would we need to contract with the different actuary to do that? Or,

Uh, Representative Ward, uh, thank you for the question. Um, the, this is just to ensure that the actuary is truly, uh, separated. Um, a lot of actuaries will point out that there are, um, ethical or physical barriers between in, um, related parties when they conduct, um, that, uh, analysis. Um, but the, the issue here is not necessarily the barrier between information, those are informational barriers. Um, we wanna make sure that there's, um, barriers in the interests of the actuaries, um, as they're, um, doing contract and doing business with the, uh, MCOs.

Okay. And, and we do also have some degree of, uh, audit function is my understanding.

Um, and we have, uh, the OIG right now that does some of these things mostly to see if there's proper payments. But is your understanding that OIG does not interact at all with the MCOs, Um, Or MCOs as We call 'em here? And, and I'm not sure on that.

I do know that there's a bill coming through the, the Senate that's actually addressing the OIG, um, which might be helpful in this case. And some of this section may not even be needed. Well, we're still kind of using, we're still kind of working through that and parsing through that. Okay.

I mean, I've frustration, not a frustration, but I think just to think about with OIG is, I know OIG comes in and reports to us on the overpayments that they find or where pay, you know, money has to be given back if the service wasn't provided. Their description of what they're supposed to do does also include making sure that that services were in fact provided, um, uh, to people. And I wanna make sure that happens also. Yeah,

Agreed. Agreed. And, and it's interesting. Thank you, Mr. Chair. And it's interesting that you brought that up because there was just a report on that, um, from the OIG about overpayments in, in the, um, and I'm blanking on the, what it's, anyway, it was like $101 million, um, that were paid, uh, two MCOs of people that were maybe covered in other states at the same time as they were covered here. So those are, those are things, all this information is things that we're, we just think that aggregate of all the data in one place is gonna be helpful for that transparency.

Um, thank you. Yeah, clearly I'm supportive of, um, transparency and fiscal responsibility and, um, eliminating conflict of interest. Just wondering, um, with the projected costs here, um, for administrative costs and staffing, you know, for the audits, for the reports, the corrective action plans, et cetera, um, how will we know if, uh, the transparency gains will outweigh the added regulatory burden on the MCOs Medicaid, HHS, et cetera?

Well, a lot of the information that, that we're asking for, they already provide. They say they already provide, but, um, it's not, it's not condensed into totals of what, what's going on the totals of things that we're asking for. So they're already providing all this information. Um, so there shouldn't be too big of a cost on, on that portion of it, on the audit auditing and, and the other things there may be. And like I said, we are still kind of working on that and, and we'll hopefully address some of those fiscal, um, issues. Thanks.

Good afternoon, Mr. Chair and members of the committee. My name is Michael Hales. I work for the University of Utah Health Plans and I'm here representing the Medicaid a CO Coalition. We appreciate, uh, Representative Hall and bringing forward this bill and engaging us in an opportunity to discuss this. The first substitute represents a lot of improvement over where we think the bill started and Where're committed to keep working with her to get it right where we feel comfortable with it. We are supportive of transparency. As Representative Hall mentioned, most of this information is already provided to the Medicaid agency today. Uh, we just need to work out the details on the timing of some of the things and the, uh, materiality of some of the reporting. And I think one of the things the bill, uh, contemplates is making this information publicly available rather than just held at the agency. And just trying to make sure we work through, uh, some of those details is, is where we're at. And I think with continued discussions we're encouraged that we will be able to get there. Uh, thank you. Thank You. Thank you.

And I'm moving a sub first it looks like. Yep. Yes. Thank you. Then I would like to, uh, move to adopt first sub house bill 5 6 6.

Yes. That incorporates some of the changes that we already made as we met together. And there will be more

That'd be great. Uh, thank you. I'd like to make a motion that we favorably recommend House Bill 5 66 for substitute.

In the interest of time, I will waive

I'll waive the presentation and summation. Awesome.

Thank you Chair Harper. Thank you Committee for having me. Um, HB 5 66. Uh, and I do have a sub that needs to be adopted as well. Okay. I think it's, is it three? Three? Thank you. Um, so what this does, um, Medicaid plays a major role in the nation's healthcare system representing almost one out of every $5 spent on healthcare in the United States. Managed care is contrasted with fee for service as a method for reimbursing healthcare services. So fee for services is a provider delivers a service, submits a claim, and then DHHS would pay that claim. Managed care programs or Medicaid programs that contract with an MCO or managed care organization to manage the delivery of a defined set of services for a fixed amount, typically in the form of a monthly capitated payment. Um, around 11% of all Utahans are enrolled in Medicaid. And about 75 to 85% of those enrolled in Medicaid are, um, served by managed care organizations. So basically what this bill does is just asks for some data on that. We've had managed care systems dating back to 1982, but limited data exists to show, you know, like where we're spending all the money. How successful are they? Um, I think they're pretty successful, but I think we also, um, can, can benefit by having a, a better picture of, of where all the money is going. This bill basically just establishes a set of transparency requirements for Utah's Medicaid managed care organizations. Um, that's the bill. I'm happy to go into the, um, details of it. If, if you want to in questions. I, I do have someone online that can help me with some of, if there's technical questions. Um, but I also wanna speak to how we came to the final sub that we have here was very much, we met with, um, DHHS and the managed care organizations and lobbyists and, um, transparency is the goal. So we just kept all the transparency stuff in there. We had some audit pieces, we had some actuarial audit pieces. We took all of that out. We just want a dashboard. It basically just says DHHS will make a dashboard and, and have all these totals of things so we can see where all the money is going. Thank You to the bill.

Yeah, I like the bill and I understand what you're trying to do. I'm learning here because I didn't know the division of Integrated Healthcare was a division or part of it. So are we having a, let's just say a child, uh, go back to the parent and say, we're gonna audit you or set up this and you're gonna comply. Is that what we're doing? Because, No, I do not believe so. I don't know where that, is that on? Oh, that's on the front. It it's on the line. A that Okay. Just on the highlighted, you know, I'm starting to see, what am I reading about? That's one of those things. And it just raised that question. I understand the purpose of this and we can't fix up, we Yeah, we don't know. Yeah. So we need to, to put it out there so that it's transparent and trackable. So here's the target. Mm-hmm. Yeah. Understand. It's DHHS, basically the, okay.

Thank you Mr. Chair. Uh, I move that we delete title and body of second sub house bill 5 66 and replace it with third sub house bill 5 66.

Okay. Thank you. Um, the substituted bill. So basically we just changed some of the dates because DHHS was like, we can't get it done by July, let's move it. So we moved it to the end of the year. Give them extra time. Um, I think that was the big change. What was the other change? Um, I think that was the major change, just making sure that they had enough time to collect the data. Alright.

Let me just, just when you're ready for a motion. Okay. Mr. Chair,

Uh, that we favorly recommend House Bill 5 66. Third substitute the whole body of the Senate. Thank you.

Thank you so much, committee. Appreciate it.

Thank you Mr. Speaker Pro Tem. A motion to adopt second substitute.

Um, yes. This, this substitute represents, um, a lot of compromise and I'll speak to it when I speak to the bill.

Thank you Mr. Speaker. Um, colleagues, Medicaid plays a major role in the nation's healthcare system representing almost one out of every $5 spent. Managed care is a a way that we do, um, Medicaid in this state. Um, about 11% of our residents are on Medicaid and managed care for that Medicaid represents between 75 and 80% of how it's done. So this, um, and it's been that way, it's been in place since 1982. We've had managed care organizations. What we haven't really had is, um, kind of a consolidation of the totals of what is spent, um, how many people are seeing all these kind of things. And so what this bill attempts to do is, is, is ask DHHS to take all of the information that they are getting from these managed care organizations, which they automatically already have to report and consolidate it into a dashboard that will give us some meaningful information and data on our, is our tax money being used wisely with managed care And or, or conversely is um, fee for service as well. Uh, this, this bill right here only represents, um, taking that data from managed care for now and we're gonna work on other things as we go. Some things that we took out of this bill, we had some auditing requirements and some actuarial requirements that as we worked with all the stakeholders, we thought that isn't the right time, it's not the right time. We need to work on that piece a little bit more. So we've just taken that out for now. Um, I think this is a very good transparency Bill and will give us some windows into, um, how the taxpayer money is being used on Medicaid and I'm happy to take any questions.

I will waive. Thank you. Commission is waived.

Um, yes. This, this substitute represents, um, a lot of compromise and I'll speak to it when I speak to the bill.

Thank you Mr. Speaker. Um, colleagues, Medicaid plays a major role in the nation's healthcare system representing almost one out of every $5 spent. Managed care is a a way that we do, um, Medicaid in this state. Um, about 11% of our residents are on Medicaid and managed care for that Medicaid represents between 75 and 80% of how it's done. So this, um, and it's been that way, it's been in place since 1982. We've had managed care organizations. What we haven't really had is, um, kind of a consolidation of the totals of what is spent, um, how many people are seeing all these kind of things. And so what this bill attempts to do is, is, is ask DHHS to take all of the information that they are getting from these managed care organizations, which they automatically already have to report and consolidate it into a dashboard that will give us some meaningful information and data on our, is our tax money being used wisely with managed care And or, or conversely is um, fee for service as well. Uh, this, this bill right here only represents, um, taking that data from managed care for now and we're gonna work on other things as we go. Some things that we took out of this bill, we had some auditing requirements and some actuarial requirements that as we worked with all the stakeholders, we thought that isn't the right time, it's not the right time. We need to work on that piece a little bit more. So we've just taken that out for now. Um, I think this is a very good transparency Bill and will give us some windows into, um, how the taxpayer money is being used on Medicaid and I'm happy to take any questions.

Thank you Mr. Speaker pro tem. I wanna rise in support of this bill. Uh, one of the things I continually hear from my constituents is they would like to have more transparency and understanding of why our medical costs are so high in this state. Uh, this is a great bill that will hopefully get to the root of some of these causes and help bring that. So I'm in support of the bill. Thank you.

I will waive. Thank you. Commission is waived.

Thank you Mr. President. Uh, this bill will establish a set of transparency requirements for Utah's Medicaid managed care organizations. Around 11% of all Utah utahns are enrolled in Medicaid and about 75 to 85% of those Medicaid enrollees are served by a managed care organization or accountable care organization. This bill would require managed care financial data that is already reported to DHHS spending on pass through state directed payments, emergency room visits and costs. Number of enrollees enrollees who do not, who did not file any claims to be reported and compiled on DHHS website by December 21st, 2026. And it also requires repayment of any improper payments. Mr. President, this is a transparency bill for the Medicaid expendables expenditures. And with that, I'd be happy to open, ask any answer, any questions, Mr. President?

Thank you Mr. President. Under suspension of rules, I move that, uh, third substitute house bill 5 66 pass.

Vote. Senator Spery Lewin Bramer Bus Colmore Esca Fillmore Fillmore Grover Harper Hankins Ipson Johnson Juab McKay Aye. Mikel Aye. Milner Musselman Owens pitcher Plum Rebe Sandal Stevenson Stevenson Stratton Aye. Vickers Weiler Wilson. Aye. Winterton President Adams Aye. Thirst substitute house bill 5 66 Having received 25 yay votes, zero nay votes for being absent passes.

A motion to encircle second substitute house bill 2 73.

Uh, yeah, I'd like to, uh,

Thank you Mr. Speaker. Motion to concur with the Senate amendments.

Yes. Uh, I helped with the Senate amendments. All we did was change a couple of dates to allow DHHS more time to develop that transparency website and then also, um, just allow that if there is something that would interfere with an, with an ongoing investigation, they wouldn't have to post that.