SF 2045

as introduced - 89th Legislature (2015 - 2016) Posted on 10/07/2015 03:04pm

A bill for an act
relating to human services; changing financial audit provisions for managed care
and county-based purchasing plans; amending Minnesota Statutes 2014, section
256B.69, subdivision 9d, by adding a subdivision.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

Minnesota Statutes 2014, section 256B.69, subdivision 9d, is amended to
read:

Subd. 9d.

Financial deleted text begin audit deleted text end new text begin and quality assurance audits new text end .

deleted text begin (a) The legislative
auditor shall contract with an audit firm to conduct a biennial independent third-party
financial audit of the information required to be provided by managed care plans and
county-based purchasing plans under subdivision 9c, paragraph (b). The audit shall be
conducted in accordance with generally accepted government auditing standards issued
by the United States Government Accountability Office. The contract with the audit
firm shall be designed and administered so as to render the independent third-party audit
eligible for a federal subsidy, if available. The contract shall require the audit to include
a determination of compliance with the federal Medicaid rate certification process. The
contract shall require the audit to determine if the administrative expenses and investment
income reported by the managed care plans and county-based purchasing plans are
compliant with state and federal law.
deleted text end

deleted text begin (b) For purposes of this subdivision, "independent third party" means an audit firm
that is independent in accordance with government auditing standards issued by the United
States Government Accountability Office and licensed in accordance with chapter 326A.
An audit firm under contract to provide services in accordance with this subdivision must
not have provided services to a managed care plan or county-based purchasing plan during
the period for which the audit is being conducted.
deleted text end

deleted text begin (c) deleted text end new text begin (a) new text end The commissioner shall require, in the request for bids and resulting contracts
with managed care plans and county-based purchasing plans under this section and section
256B.692, that each managed care plan and county-based purchasing plan submit to and
fully cooperate with the independent third-party financial deleted text begin audit deleted text end new text begin audits by the legislative
auditor under subdivision 9e new text end of the information required under subdivision 9c, paragraph
(b). Each contract with a managed care plan or county-based purchasing plan under this
section or section 256B.692 must provide the commissioner and the deleted text begin audit firm deleted text end new text begin vendors
new text end contracting with the legislative auditor access to all data required to complete the audit
new text begin under subdivision 9e new text end . deleted text begin For purposes of this subdivision, the contracting audit firm shall have
the same investigative power as the legislative auditor under section 3.978, subdivision 2.
deleted text end

deleted text begin (d) deleted text end new text begin (b) new text end Each managed care plan and county-based purchasing plan providing services
under this section shall provide to the commissioner biweekly encounter data and claims
data for state public health care programs and shall participate in a quality assurance
program that verifies the timeliness, completeness, accuracy, and consistency of the data
provided. The commissioner shall develop written protocols for the quality assurance
program and shall make the protocols publicly available. The commissioner shall contract
for an independent third-party audit to evaluate the quality assurance protocols as to
the capacity of the protocols to ensure complete and accurate data and to evaluate the
commissioner's implementation of the protocols. The audit firm under contract to provide
this evaluation must meet the requirements in deleted text begin paragraph (b) deleted text end new text begin subdivision 9e new text end .

deleted text begin (e) Upon completion of the audit under paragraph (a) and receipt by the legislative
auditor, the legislative auditor shall provide copies of the audit report to the commissioner,
the state auditor, the attorney general, and the chairs and ranking minority members of the
health and human services finance committees of the legislature. deleted text end new text begin (c) new text end Upon completion
of the evaluation under paragraph deleted text begin (d) deleted text end new text begin (b) new text end , the commissioner shall provide copies of the
report to the legislative auditor and the chairs and ranking minority members of the deleted text begin health
finance committees of the legislature deleted text end new text begin legislative committee with jurisdiction over health
care policy and financing new text end .

deleted text begin (f) deleted text end new text begin (d) new text end Any actuary under contract with the commissioner to provide actuarial
services must meet the independence requirements under the professional code for fellows
in the Society of Actuaries and must not have provided actuarial services to a managed
care plan or county-based purchasing plan that is under contract with the commissioner
pursuant to this section and section 256B.692 during the period in which the actuarial
services are being provided. An actuary or actuarial firm meeting the requirements
of this paragraph must certify and attest to the rates paid to the managed care plans
and county-based purchasing plans under this section and section 256B.692, and the
certification and attestation must be auditable.

deleted text begin (g) deleted text end new text begin (e) new text end Nothing in this subdivision shall allow the release of information that is
nonpublic data pursuant to section 13.02.

new text begin (f) The commissioner shall conduct ad hoc audits of managed care organizations'
administrative and medical expenses. This includes financial and encounter data reporting
under subdivision 9c, including: (1) contracts with subcontractors; (2) payments to
providers and subcontractors; (3) supporting documentation for expenditures; (4)
categorization of administrative and medical expenses; and (5) allocation methods used to
attribute administrative expenses to state public programs. These audits must also monitor
compliance with data and financial certifications provided to the commissioner for the
purposes of capitation rate-setting. The managed care plans and county-based purchasing
plans shall fully cooperate with the audits in this subdivision. The commissioner shall
impose a financial penalty for plans that fail to comply with this subdivision.
new text end

Sec. 2.

Minnesota Statutes 2014, section 256B.69, is amended by adding a subdivision
to read:

new text begin Subd. 9e. new text end

new text begin Financial audits. new text end

new text begin (a) The legislative auditor shall contract with vendors
to conduct independent third-party financial audits of the information required to be
provided by managed care plans and county-based purchasing plans under subdivision
9c, paragraph (b). The audits by the vendors shall be conducted as vendor resources
permit and in accordance with generally accepted government auditing standards issued
by the United States Government Accountability Office. The contracts with the vendors
shall be designed and administered so as to render the independent third-party audits
eligible for a federal subsidy, if available. The contracts shall require the audits to include
a determination of compliance with the federal Medicaid rate certification process.
new text end

new text begin (b) For purposes of this subdivision, "independent third party" means a vendor that
is independent in accordance with government auditing standards issued by the United
States Government Accountability Office.
new text end