HOUSE BILL No. 4003 January 8, 1997, Introduced by Rep. Schauer and referred to the Committee on Insurance. A bill to amend 1980 PA 350, entitled "The nonprofit health care corporation reform act," by amending section 401 (MCL 550.1401), as amended by 1984 PA 66. THE PEOPLE OF THE STATE OF MICHIGAN ENACT: 1 Sec. 401. (1) A health care corporation established, main- 2 tained, or operating in this state shall offer health care bene- 3 fits to all residents of this state, and may offer other health 4 care benefits as the corporation specifies with the approval of 5 the commissioner. 6 (2) A health care corporation may limit the health care ben- 7 efits that it will furnish, except as provided in this act, and 8 may divide the health care benefitswhichTHAT it elects to 9 furnish into classes or kinds. 01043'97 DKH 2 1 (3) A health care corporation shall not do any of the 2 following: 3 (a) Refuse to issue or continue a certificate to 1 or more 4 residents of this state, except while the individual, based on a 5 transaction or occurrence involving a health care corporation, is 6 serving a sentence arising out of a charge of fraud, is satisfy- 7 ing a civil judgment, or is making restitution pursuant to a vol- 8 untary payment agreement between the corporation and the 9 individual. 10 (b) Refuse to continue in effect a certificate with 1 or 11 more residents of this state, other than for failure to pay 12 amounts due for a certificate, except as allowed for refusal to 13 issue a certificate under subdivision (a). 14 (c) Limit the coverage available under a certificate, with- 15 out the prior approval of the commissioner, unless the limitation 16 is as a result of: an agreement with the person paying for the 17 coverage; an agreement with the individual designated by the per- 18 sons paying for or contracting for the coverage; or a collective 19 bargaining agreement. 20 (D) RATE, CANCEL BENEFITS ON, REFUSE TO PROVIDE BENEFITS 21 FOR, OR REFUSE TO ISSUE OR CONTINUE A CERTIFICATE SOLELY BECAUSE 22 A SUBSCRIBER OR APPLICANT IS OR HAS BEEN A VICTIM OF DOMESTIC 23 ASSAULT. 24 (4)Nothing in subsection (3) shallSUBSECTION (3) DOES 25 NOT prevent a health care corporation from denying to a resident 26 of this state coverage under a certificate for any of the 27 following grounds: 01043'97 3 1 (a) That the individual was not a member of a groupwhich2 THAT had contracted for coverage under this certificate. 3 (b) That the individual is not a member of a group with a 4 size greater than a minimum size established for a certificate 5 pursuant to sound underwriting requirements. 6 (c) That the individual does not meet requirements for cov- 7 erage contained in a certificate. 8 (5) A certificate may provide for the coordination of bene- 9 fits, subrogation, and the nonduplication of benefits. Savings 10 realized by the coordination of benefits, subrogation, and nondu- 11 plication of benefits shall be reflected in the rates for those 12 certificates. If a group certificate issued by the corporation 13 contains a coordination of benefits provision, the benefits shall 14 be payable pursuant to the coordination of benefits act. 15 (6) A health care corporation shall have the right to status 16 as a party in interest, whether by intervention or otherwise, in 17 any judicial, quasi-judicial, or administrative agency proceeding 18 in this state for the purpose of enforcing any rights it may have 19 for reimbursement of payments made or advanced for health care 20 services on behalf of 1 or more of its subscribers or members. 21 (7) A health care corporation shall not directly reimburse a 22 provider in this state who has not entered into a participating 23 contract with the corporation. 24 (8) A health care corporation shall not limit or deny cover- 25 age to a subscriber or limit or deny reimbursement to a provider 26 on the ground that services were rendered while the subscriber 27 was in a health care facility operated by this state or a 01043'97 4 1 political subdivision of this state. A health care corporation 2 shall not limit or deny participation status to a health care 3 facility on the ground that the health care facility is operated 4 by this state or a political subdivision of this state, if the 5 facility meets the standards set by the corporation for all other 6 facilities of that type, government-operated or otherwise. To 7 qualify for participation and reimbursement, a facility shall, at 8 a minimum, meet all of the following requirements, which shall 9 apply to all similar facilities: 10 (a) Be accredited by the joint commission on accreditation 11 of hospitals. 12 (b) Meet the certification standards of the medicare program 13 and the medicaid program. 14 (c) Meet all statutory requirements for certificate of 15 need. 16 (d) Follow generally accepted accounting principles and 17 practices. 18 (e) Have a community advisory board. 19 (f) Have a program of utilization and peer review to assure 20 that patient care is appropriate and at an acute level. 21 (g) Designate that portion of the facilitywhichTHAT is 22 to be used for acute care. 01043'97 Final page. DKH