1.1                          A bill for an act
  1.2             relating to health; requiring medical directors for 
  1.3             health maintenance organizations; establishing 
  1.4             liability for health treatment decisions and policies; 
  1.5             establishing requirements for physicians performing 
  1.6             utilization review; requiring annual disclosure of 
  1.7             utilization review criteria; modifying the definition 
  1.8             of practice of medicine; amending Minnesota Statutes 
  1.9             1998, sections 62D.02, by adding subdivisions; 62M.09, 
  1.10            subdivision 2, and by adding a subdivision; and 
  1.11            147.081, subdivision 3; Minnesota Statutes 1999 
  1.12            Supplement, sections 62M.09, subdivision 3; and 
  1.13            62M.10, subdivision 7; proposing coding for new law in 
  1.14            Minnesota Statutes, chapter 62D. 
  1.15  BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.16     Section 1.  Minnesota Statutes 1998, section 62D.02, is 
  1.17  amended by adding a subdivision to read: 
  1.18     Subd. 17.  [ORDINARY CARE.] "Ordinary care" means, in the 
  1.19  case of a health maintenance organization, the degree of care 
  1.20  that a health maintenance organization of ordinary prudence 
  1.21  would use under the same or similar circumstances.  In the case 
  1.22  of a medical director, ordinary care means the degree of care 
  1.23  that an individual of ordinary prudence in the same profession, 
  1.24  specialty, or area of practice as the medical director would use 
  1.25  in the same or similar circumstances. 
  1.26     Sec. 2.  Minnesota Statutes 1998, section 62D.02, is 
  1.27  amended by adding a subdivision to read: 
  1.28     Subd. 18.  [TREATMENT DECISION.] "Treatment decision" means 
  1.29  a medical decision by a health care provider regarding the 
  1.30  access given to a patient to health care services, procedures, 
  2.1   and facilities.  Treatment decision includes a decision to deny 
  2.2   a patient access to a health care service, procedure, or 
  2.3   facility. 
  2.4      Sec. 3.  Minnesota Statutes 1998, section 62D.02, is 
  2.5   amended by adding a subdivision to read: 
  2.6      Subd. 19.  [TREATMENT POLICY.] "Treatment policy" means a 
  2.7   policy or set of criteria used by a health care provider making 
  2.8   treatment decisions to determine whether a specific patient 
  2.9   should be given access to a specific health care service, 
  2.10  treatment, or facility. 
  2.11     Sec. 4.  Minnesota Statutes 1998, section 62D.02, is 
  2.12  amended by adding a subdivision to read: 
  2.13     Subd. 20.  [UTILIZATION REVIEW.] "Utilization review" has 
  2.14  the meaning given in section 62M.02, subdivision 20. 
  2.15     Sec. 5.  [62D.31] [MEDICAL DIRECTOR.] 
  2.16     Subdivision 1.  [PHYSICIAN LICENSED IN MINNESOTA.] A health 
  2.17  maintenance organization shall designate a licensed physician to 
  2.18  serve as its medical director.  The medical director shall be a 
  2.19  physician licensed to practice medicine under chapter 147.  A 
  2.20  medical director is subject to all forms of disciplinary action 
  2.21  and penalties specified in chapter 147. 
  2.22     Subd. 2.  [RESPONSIBILITIES.] A medical director shall be 
  2.23  responsible for all treatment decisions and policies, protocols, 
  2.24  quality assurance programs, and utilization review decisions of 
  2.25  a health maintenance organization.  The treatment decisions and 
  2.26  policies, protocols, quality assurance programs, and utilization 
  2.27  review decisions shall be based on the higher of the following 
  2.28  two standards: 
  2.29     (1) generally accepted standards of health care practice 
  2.30  among health maintenance organizations; and 
  2.31     (2) generally accepted standards of health care practice in 
  2.32  the medical community. 
  2.33     Subd. 3.  [LIABILITY FOR TREATMENT DECISIONS AND POLICIES.] 
  2.34  A medical director has the duty to exercise ordinary care in 
  2.35  being responsible for all treatment decisions and treatment 
  2.36  policies of a health maintenance organization and is liable for 
  3.1   damages for harm to an enrollee if the damage is proximately 
  3.2   caused by the medical director's failure to exercise ordinary 
  3.3   care. 
  3.4      Sec. 6.  [62D.32] [LIABILITY OF HEALTH MAINTENANCE 
  3.5   ORGANIZATIONS.] 
  3.6      Subdivision 1.  [LIABILITY.] (a) A health maintenance 
  3.7   organization has the duty to exercise ordinary care when making 
  3.8   treatment decisions and applying treatment policies.  A health 
  3.9   maintenance organization is liable for damages for harm to an 
  3.10  enrollee if the damage is proximately caused by its failure to 
  3.11  exercise ordinary care. 
  3.12     (b) A health maintenance organization is liable for damages 
  3.13  for harm to an enrollee proximately caused by a treatment 
  3.14  decision made by its employees, agents, or representatives who 
  3.15  are acting on behalf of the organization and over whom the 
  3.16  organization has the right to exercise influence or control or 
  3.17  has actually exercised influence or control that results in the 
  3.18  failure to exercise ordinary care. 
  3.19     Subd. 2.  [PROHIBITED DEFENSE.] Nothing in any law of this 
  3.20  state that states that a health maintenance organization is not 
  3.21  deemed to be practicing a healing art may be asserted as a 
  3.22  defense by a health maintenance organization to a cause of 
  3.23  action brought against it under this section. 
  3.24     Sec. 7.  Minnesota Statutes 1998, section 62M.09, 
  3.25  subdivision 2, is amended to read: 
  3.26     Subd. 2.  [LICENSURE REQUIREMENT.] Except as provided in 
  3.27  subdivision 2a, nurses~~, physicians,~~ and other licensed health 
  3.28  professionals conducting reviews of medical services~~,~~ and other 
  3.29  clinical reviewers conducting specialized reviews in their area 
  3.30  of specialty must be currently licensed or certified by an 
  3.31  approved state licensing agency in the United States. 
  3.32     Sec. 8.  Minnesota Statutes 1998, section 62M.09, is 
  3.33  amended by adding a subdivision to read: 
  3.34     Subd. 2a.  [LICENSURE, SPECIALTY REQUIREMENTS; PHYSICIANS.] 
  3.35  A physician conducting a review of medical services must be 
  3.36  licensed in Minnesota and must be currently practicing in the 
  4.1   same primary specialty as the attending health care professional.
  4.2      Sec. 9.  Minnesota Statutes 1999 Supplement, section 
  4.3   62M.09, subdivision 3, is amended to read: 
  4.4      Subd. 3.  [PHYSICIAN REVIEWER INVOLVEMENT.] A physician 
  4.5   must review all cases in which the utilization review 
  4.6   organization has concluded that a determination not to certify 
  4.7   for clinical reasons is appropriate.  The physician conducting 
  4.8   the review must meet the requirements of subdivision 2a.  The 
  4.9   physician should be reasonably available by telephone to discuss 
  4.10  the determination with the attending health care professional.  
  4.11  This subdivision does not apply to outpatient mental health or 
  4.12  substance abuse services governed by subdivision 3a.  
  4.13     Sec. 10.  Minnesota Statutes 1999 Supplement, section 
  4.14  62M.10, subdivision 7, is amended to read: 
  4.15     Subd. 7.  [AVAILABILITY OF CRITERIA.] Upon request, a 
  4.16  utilization review organization shall provide to an enrollee or 
  4.17  to a provider the criteria used for a specific procedure to 
  4.18  determine the necessity, appropriateness, and efficacy of that 
  4.19  procedure and identify the database, professional treatment 
  4.20  guideline, or other basis for the criteria.  A utilization 
  4.21  review organization shall annually provide to the commissioners 
  4.22  of health and commerce a complete list of the criteria used by 
  4.23  the organization for each specific procedure to determine the 
  4.24  necessity, appropriateness, and efficacy of that procedure and 
  4.25  for each procedure shall identify the database, professional 
  4.26  treatment guideline, or other basis for the criteria. 
  4.27     Sec. 11.  Minnesota Statutes 1998, section 147.081, 
  4.28  subdivision 3, is amended to read: 
  4.29     Subd. 3.  [PRACTICE OF MEDICINE DEFINED.] For purposes of 
  4.30  this chapter, a person not exempted under section 147.09 is 
  4.31  "practicing medicine" or engaged in the "practice of medicine" 
  4.32  if the person does any of the following:  
  4.33     (1) advertises, holds out to the public, or represents in 
  4.34  any manner that the person is authorized to practice medicine in 
  4.35  this state; 
  4.36     (2) offers or undertakes to prescribe, give, or administer 
  5.1   any drug or medicine for the use of another; 
  5.2      (3) offers or undertakes to prevent or to diagnose, 
  5.3   correct, or treat in any manner or by any means, methods, 
  5.4   devices, or instrumentalities, any disease, illness, pain, 
  5.5   wound, fracture, infirmity, deformity or defect of any person; 
  5.6      (4) offers or undertakes to perform any surgical operation 
  5.7   including any invasive or noninvasive procedures involving the 
  5.8   use of a laser or laser assisted device, upon any person; 
  5.9      (5) offers to undertake to use hypnosis for the treatment 
  5.10  or relief of any wound, fracture, or bodily injury, infirmity, 
  5.11  or disease; ~~or~~ 
  5.12     (6) uses in the conduct of any occupation or profession 
  5.13  pertaining to the diagnosis of human disease or conditions, the 
  5.14  designation "doctor of medicine," "medical doctor," "doctor of 
  5.15  osteopathy," "osteopath," "osteopathic physician," "physician," 
  5.16  "surgeon," "M.D.," "D.O.," or any combination of these 
  5.17  designations; or 
  5.18     (7) reviews a determination not to certify an admission, 
  5.19  medical service, medical procedure, or extension of a hospital 
  5.20  stay for clinical reasons under chapter 62M.