NHHA
LEGISLATIVE UPDATE
July 13, 2005
NHHA’s SUCCESS IN THE 2005 LEGISLATIVE SESSION
NHHA was very successful this year in our advocacy efforts on
behalf of New Hampshire’s hospitals. We had major victories on
medical liability reform, small group insurance reform, prompt
pay legislation, and Medicaid.
The following is a summary of priority legislation that NHHA
worked on.
MEDICAID
State Budget – Most Hospital Funding Restored
Hospitals worked hard to defeat persistent attempts to slash
Medicaid hospital payments. Faced with $38 million in proposed
reductions hospital payments, we were successful in convincing
legislators to restore funding for Catastrophic Payments ($5
million), Indirect Medical Education ($6 million), and Direct
Medical Education ($1.7 million) and Outpatient Hospital
Payments ($13 million). The final outcome is a two-year
reduction in outpatient hospital payments of $13 million.
Critical access hospitals were exempted from the outpatient
payment cuts.
We also defeated the Senate’s attempt to cap outpatient
payments, which would have allowed the DHHS Commissioner to
reduce rates if expenditures in any quarter were to exceed 25
percent of the annual appropriation for outpatient hospital
services. Instead, legislators limited the Commissioner’s
ability to reduce rates by subjecting such changes to the
scrutiny and approval of the Legislature and approval.
The legislative fiscal committee is scheduled next week to
consider the outpatient rate reduction requested by
Commissioner Stephen. If approved, outpatient hospital rates
for non-critical access hospitals will be reduced from 91.27%
of allowable costs to 81.24% effective August 1, 2005.
Finally, the Legislature created an oversight committee on
Medicaid outpatient payments, which will review the state’s
payment system and make recommendations by June, 2007.
We expect that the committee will investigate alternative
methods of reimbursement including APCs, Medicare’s outpatient
payment system. This Committee will provide hospitals with an
opportunity to address questions and concerns with DHHS and
legislators on issues related to Medicaid outpatient payments
such as interim rates, cost settlement, trends in enrollment
and service use, planning for the implementation of APCs, and
the Department’s implementation of care management and prior
authorization initiatives.
Medicaid Reform: "GraniteCare" Proposals Scaled Back
The Legislature enacted changes to the State’s Medicaid
program, significantly scaling back DHHS Commissioner John
Stephen’s plans to overhaul the Medicaid Program.
Contingent on CMS approval, HB 691 would close financial
loopholes that allow people to qualify for Medicaid-covered
nursing home care by transferring their assets for less than
fair market value. Through HB 691 the State plans to divert
patients in need of nursing home care to less costly
community-based services by conducting in-depth face-to-face
assessments of patients seeking admission to nursing homes
utilizing stricter admission criteria.
NHHA cautions that unless community-based long term care
services are sufficiently expanded to meet the increased
demand, some patients will not access needed services. We
continue to be concerned that hospitals may be forced to delay
the discharge of patients who no longer require hospital
services.
MEDICAL LIABILITY REFORM
Victory on Pretrial Screening Panels
Hospitals and physicians scored a big victory with the passage
of SB 214, the pretrial screening bill. The House vote of 218
- 115 made it clear that legislators listened to us, despite
fierce opposition by the House Judiciary Committee. Signed by
the Governor, SB 214 will go into effect August 29, 2005.
SB 214 includes three fundamental provisions:
· that the panels be mandatory
· that an appropriate standard of proof be met by the
plaintiff, and
· that unanimous panel findings be admissible at trial.
These reforms will encourage quicker settlements thereby
lowering legal costs.
To view SB 214, click here:
http://www.gencourt.state.nh.us/legislation/2005/SB0214.html
Other Medical Liability Bills
The Legislature created a commission to study non-judicial
solutions to alleviate medical malpractice premiums for high
risk specialties such as neurosurgery and obstetrics. NHHA
will be represented on the Commission, along with the NH
Medical Society, Dartmouth-Hitchcock Medical Center, insurers,
legislators, and the Insurance Commissioner. The commission
will make its recommendations November 1, 2005.
A watered down version of “I’m Sorry” legislation was passed
by the Legislature. While this legislation disqualifies
expressions of sympathy to the patient or family as evidence
of an admission of liability in medical injury cases, it does
not apply to statements of fault or negligence. It’s unlikely
that this provision will result in speedier settlements or
reduced legal and administrative costs.
We defeated two bills that would have increased litigation
costs. SB 139 would have increased malpractice defense costs
by allowing all kinds of medical records in a medical
liability case, which under current law can only be brought in
through a witness or by agreement. SB 47 would have made it
possible for defendants to pay more than their percentage of
fault, thus resulting in the defendant with the deepest
pocket, not the one most at fault, being forced to pay the
majority of the judgment.
HEALTH INSURANCE
Victory on Prompt Pay
The passage of Senate Bill 78, Prompt Pay legislation is a
victory for hospitals and physicians, helping to ensure that
insurers pay claims in a timely manner.
SB 78 will become law Sept 19, 2005.
SB 78 addresses loopholes in current law that allow insurers
to delay payments to providers with no accountability for the
money owed. A new provision requires insurers to act on denied
and pended claims within specific timeframes. The new prompt
pay law remedies the burden of providers deciphering each
insurer’s interpretation of a “clean claim”. Finally, the law
mandates automatic interest payments on overdue claims.
SB 78 Highlights:
1. Clean Claims:
Must be paid within 30 days (currently 45 days) of receipt of
clean paper claims and 15 days of receipt of a clean
electronic claim.
2. Denied and Pended Claims:
Insurers must inform providers within 15 days (electronic
claims) or 30 days (paper claims) of the reason to deny or
pend, and what additional information is required. After
additional documentation is received, the insurer must
adjudicate the claim within 45 days. If the insurer fails to
notify the provider, the claim must be treated as a clean
claim and be paid within 30/45 days.
3. Overdue Claims:
Clean claims not paid within the required timeframe will be
subject to automatic interest payments in addition to the
claim amount. SB 78 removes the burdensome provision that
requires providers to inform the insurer of the interest
payment due. The mandatory automatic interest payment should
result in quicker initial payments.
To view SB 78, click here:http://www.gencourt.state.nh.us/legislation/2005/SB0078.html
Small Group Health Insurance Reform: SB 110 Overhaul
A major victory for hospitals, businesses and Governor John
Lynch, SB 125 was enacted to remedy the effects of Senate Bill
110 that discriminated against small employers. SB 125
stripped away workers’ health status and geography from the
rate setting calculation for small groups. The new law also
places restrictions on rate increases, so that the highest
premium an insurer can charge cannot be more than 3.5 times
higher than the lowest premium. SB 125 establishes a high-risk
reinsurance pool to spread the cost for insuring individuals
with catastrophic health conditions.
With these reforms in place, SB 125 is predicted to stabilize
rates and provide relief for small employers, especially those
located in the North Country and the Seacoast.
SB 125 goes into effect January 1, 2006.
To view SB 125, click here:
http://www.gencourt.state.nh.us/legislation/2005/SB0125.html
HEALTHCARE QUALITY
NH Health Care Quality Assurance Commission
The Legislature created the New Hampshire Health Care Quality
Assurance Commission responsible for the collection, analysis
and dissemination of quality assurance information statewide.
NHHA feels this is an important step in reducing medical
errors and improving the quality of healthcare by allowing
medical practitioners to share data among hospitals statewide.
Quality of care issues to be reviewed include medical errors,
unexpected adverse outcomes and near misses, and proposed
changes to improve health care.
Every acute care hospital and ambulatory surgical center will
be represented on the new Commission. The functions of data
collection and analysis may be delegated to the Foundation for
Healthy Communities. The Commissioner’s work is expected to
begin by September, 2005.
Newborn Screening Tests
SB 108 was passed by the Legislature to streamline the process
for adding new tests for newborn screening for certain
diseases. Recommendations to expand the number of tests to
screen for preventable and treatable diseases will continue to
be made by the state’s Newborn Screening Advisory Committee.
However, this legislation requires the Committee to hold
public hearings when a new test is proposed to be added to the
panel of tests. Although the March of Dimes has endorsed
testing for 29 diseases, the Advisory Committee is proposing
an additional four tests, increasing New Hampshire’s screening
tests to a total of ten. If approved, the cost to hospitals is
estimated to increase from $18 to $35.
WORKFORCE
Nurse Practice Act Overhauled
The Legislature has revised the Nurse Practice Act, the first
major revision in decades. The Act clarifies the parameters of
the scope of practice for all nurses and also spells out the
difference between Advanced Registered Nurse Practitioner (ARNP)
categories. The legislation also addresses the issue of how
advanced registered nurse practice specialty categories are
created through national accrediting bodies approved by the
New Hampshire Board of Nursing. The revision includes
continuing competence requirements; it retains criminal
background checks required for New Hampshire nurses, but does
not require such checks for interstate compact nurses. This
differentiation is necessary for New Hampshire to participate
in the multi-state nursing compact. Also included are duty to
warn and privileged communication requirements for all
licensees.
Mandatory Overtime - Nurses
The Senate has delayed action on legislation that would
prohibit employers from requiring overtime. Exceptions are
listed in the bill, but required further definition. NHHA
joined the Board of Nursing and the NH Nurses Association in
their opposition to the bill. Hospitals do not require
mandatory overtime except in rare instances when patients are
at risk.
END OF LIFE CARE
Healthcare Decision Making
The Legislature has held on to a bill that would have updated
the state’s laws related to a Living Will and Durable Power of
Attorney for Healthcare. In the midst of the hearings on HB
656, the publicity of the Terry Schiavo case made it difficult
to move the bill forward. In the meantime, a subcommittee of
the House Judiciary Committee will further study healthcare
decision-making, including advanced directives, guardianship
and do not resuscitate orders.
Go to
http://www.nhha.org/nhha/state_law/bills.php to view the
list of bills NHHA will be tracking in 2005. Additional bills
will be added as we become aware of them.
