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As Introduced
136th
General Assembly
Regular
Session
H. B. No. 589
2025-2026
Representative Mathews, A.
To
amend sections 3963.01 and 3963.04 of the Revised Code
regarding
material amendments to contracts between health insurers and health
care providers.
BE
IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:
Section
1.
That
sections 3963.01 and 3963.04 of the Revised Code be amended to read
as follows:
Sec.
3963.01.
As
used in this chapter:
(A)
"Affiliate" means any person or entity that has ownership
or control of a contracting entity, is owned or controlled by a
contracting entity, or is under common ownership or control with a
contracting entity.
(B)
"Basic health care services" has the same meaning as in
division (A) of section 1751.01 of the Revised Code, except that it
does not include any services listed in that division that are
provided by a pharmacist or nursing home.
(C)
"Covered vision services" means vision care services or
vision care materials for which a reimbursement is available under an
enrollee's health care contract, or for which a reimbursement would
be available but for the application of contractual limitations, such
as a deductible, copayment, coinsurance, waiting period, annual or
lifetime maximum, frequency limitation, alternative benefit payment,
or any other limitation.
(D)
"Contracting entity" means any person that has a primary
business purpose of contracting with participating providers for the
delivery of health care services.
(E)
"Covered dental services" means dental care services for
which reimbursement is available under an enrollee's health care
contract, or for which a reimbursement would be available but for the
application of contractual limitations, such as a deductible,
copayment, coinsurance, waiting period, annual or lifetime maximum,
frequency limitation, alternative benefit payment, or any other
limitation.
(F)
"Credentialing" means the process of assessing and
validating the qualifications of a provider applying to be approved
by a contracting entity to provide basic health care services,
specialty health care services, or supplemental health care services
to enrollees.
(G)
"Dental care provider" means a dentist licensed under
Chapter 4715. of the Revised Code. "Dental care provider"
does not include a dental hygienist licensed under Chapter 4715. of
the Revised Code.
(H)
"Edit" means adjusting one or more procedure codes billed
by a participating provider on a claim for payment or a practice that
results in any of the following:
(1)
Payment for some, but not all of the procedure codes originally
billed by a participating provider;
(2)
Payment for a different procedure code than the procedure code
originally billed by a participating provider;
(3)
A reduced payment as a result of services provided to an enrollee
that are claimed under more than one procedure code on the same
service date.
(I)
"Electronic claims transport" means to accept and digitize
claims or to accept claims already digitized, to place those claims
into a format that complies with the electronic transaction standards
issued by the United States department of health and human services
pursuant to the "Health Insurance Portability and Accountability
Act of 1996," 110 Stat. 1955, 42 U.S.C. 1320d, et seq., as those
electronic standards are applicable to the parties and as those
electronic standards are updated from time to time, and to
electronically transmit those claims to the appropriate contracting
entity, payer, or third-party administrator.
(J)
"Enrollee" means any person eligible for health care
benefits under a health benefit plan, including an eligible recipient
of medicaid, and includes all of the following terms:
(1)
"Enrollee" and "subscriber" as defined by section
1751.01 of the Revised Code;
(2)
"Member" as defined by section 1739.01 of the Revised Code;
(3)
"Insured" and "plan member" pursuant to Chapter
3923. of the Revised Code;
(4)
"Beneficiary" as defined by section 3901.38 of the Revised
Code.
(K)
"Health care contract" means a contract entered into,
materially amended, or renewed between a contracting entity and a
participating provider for the delivery of basic health care
services, specialty health care services, or supplemental health care
services to enrollees.
(L)
"Health care services" means basic health care services,
specialty health care services, and supplemental health care
services.
(M)
"Material amendment" means an amendment to a health care
contract
,
including an amendment to any program, policy, or procedure of the
contracting entity that is applicable to participating providers
under the health care contract,
that decreases the participating provider's payment or compensation,
changes the administrative procedures in a way that may reasonably be
expected to significantly increase the provider's administrative
expenses, or adds a new product. A material amendment does not
include any of the following:
(1)
A decrease in payment or compensation resulting solely from a change
in a published fee schedule upon which the payment or compensation is
based and the date of applicability is clearly identified in the
contract;
(2)
A decrease in payment or compensation that was anticipated under the
terms of the contract, if the amount and date of applicability of the
decrease is clearly identified in the contract;
(3)
An administrative change that may significantly increase the
provider's administrative expense, the specific applicability of
which is clearly identified in the contract;
(4)
Changes to an existing prior authorization, precertification,
notification, or referral program that do not substantially increase
the provider's administrative expense;
(5)
Changes to an edit program or to specific edits if the participating
provider is provided notice of the changes pursuant to division
(A)(1) of section 3963.04 of the Revised Code and the notice includes
information sufficient for the provider to determine the effect of
the change;
(6)
Changes to a health care contract described in division (B) of
section 3963.04 of the Revised Code.
(N)
"Participating provider" means a provider that has a health
care contract with a contracting entity and is entitled to
reimbursement for health care services rendered to an enrollee under
the health care contract.
(O)
"Payer" means any person that assumes the financial risk
for the payment of claims under a health care contract or the
reimbursement for health care services provided to enrollees by
participating providers pursuant to a health care contract.
(P)
"Primary enrollee" means a person who is responsible for
making payments for participation in a health care plan or an
enrollee whose employment or other status is the basis of eligibility
for enrollment in a health care plan.
(Q)
"Procedure codes" includes the American medical
association's current procedural terminology code, the American
dental association's current dental terminology, and the centers for
medicare and medicaid services health care common procedure coding
system.
(R)
"Product" means one of the following types of categories of
coverage for which a participating provider may be obligated to
provide health care services pursuant to a health care contract:
(1)
A health maintenance organization or other product provided by a
health insuring corporation;
(2)
A preferred provider organization;
(3)
Medicare;
(4)
Medicaid;
(5)
Workers' compensation.
(S)
"Provider" means a physician, podiatrist, dentist,
chiropractor, optometrist, psychologist, physician assistant,
advanced practice registered nurse, occupational therapist, massage
therapist, physical therapist, licensed professional counselor,
licensed professional clinical counselor, hearing aid dealer,
orthotist, prosthetist, home health agency, hospice care program,
pediatric respite care program, or hospital, or a provider
organization or physician-hospital organization that is acting
exclusively as an administrator on behalf of a provider to facilitate
the provider's participation in health care contracts.
"Provider"
does not mean either of the following:
(1)
A nursing home;
(2)
A provider organization or physician-hospital organization that
leases the provider organization's or physician-hospital
organization's network to a third party or contracts directly with
employers or health and welfare funds.
(T)
"Specialty health care services" has the same meaning as in
section 1751.01 of the Revised Code, except that it does not include
any services listed in division (B) of section 1751.01 of the Revised
Code that are provided by a pharmacist or a nursing home.
(U)
"Supplemental health care services" has the same meaning as
in division (B) of section 1751.01 of the Revised Code, except that
it does not include any services listed in that division that are
provided by a pharmacist or nursing home.
(V)
"Vision care materials" includes lenses, devices containing
lenses, prisms, lens treatments and coatings, contact lenses,
orthopics, vision training, and any prosthetic device necessary to
correct, relieve, or treat any defect or abnormal condition of the
human eye or its adnexa.
(W)
"Vision care provider" means either of the following:
(1)
An optometrist licensed under Chapter 4725. of the Revised Code;
(2)
A physician authorized under Chapter 4731. of the Revised Code to
practice medicine and surgery or osteopathic medicine and surgery.
Sec.
3963.04.
(A)(1)
If an amendment to a health care contract is not a material
amendment, the contracting entity shall provide the participating
provider notice of the amendment at least fifteen days prior to the
effective date of the amendment. The contracting entity shall provide
all other notices to the participating provider pursuant to the
health care contract.
(2)
A
material amendment
If
an amendment
to
a health care contract
shall
occur only if
is
a material amendment,
the
contracting entity
provides
shall
provide
to
the participating provider the
proposed
material
amendment in writing and notice of the
proposed
material
amendment not later than ninety days prior to the effective date of
the
proposed
material
amendment. The notice shall be conspicuously entitled "Notice of
Material Amendment to Contract."
(3)
If within
fifteen
thirty
days
after receiving the
proposed
material
amendment and notice described in division (A)(2) of this section,
the participating provider objects in writing to the
proposed
material
amendment,
the
contracting entity
and
there
is no resolution of
the
participating provider shall confer within thirty days of the notice
of objection in an effort to resolve
the
objection
,
either party may terminate the health care contract upon written
notice of termination provided to the other party not later than
sixty days prior to the effective date of the
.
The proposed
material
amendment
shall not be effective unless both parties agree to the material
amendment and both parties sign their agreement in writing
.
(4)
If the participating provider does not object to the
proposed
material
amendment in the manner described in division (A)(3) of this section,
the
proposed
material
amendment shall be effective as specified in the notice described in
division (A)(2) of this section.
(B)(1)
Division (A) of this section does not apply if the delay caused by
compliance with that division could result in imminent harm to an
enrollee, if the material amendment of a health care contract is
required by state or federal law, rule, or regulation, or if the
provider affirmatively accepts the material amendment in writing and
agrees to an earlier effective date than otherwise required by
division (A)(2) of this section.
(2)
This section does not apply under any of the following circumstances:
(a)
The participating provider's payment or compensation is based on the
current medicaid or medicare physician fee schedule, and the change
in payment or compensation results solely from a change in that
physician fee schedule.
(b)
A routine change or update of the health care contract is made in
response to any addition, deletion, or revision of any service code,
procedure code, or reporting code, or a pricing change is made by any
third party source.
For
purposes of division (B)(2)(b) of this section:
(i)
"Service code, procedure code, or reporting code" means the
current procedural terminology (CPT), current dental terminology
(CDT), the healthcare common procedure coding system (HCPCS), the
international classification of diseases (ICD), or the drug topics
redbook average wholesale price (AWP).
(ii)
"Third party source" means the American medical
association, American dental association, the centers for medicare
and medicaid services, the national center for health statistics, the
department of health and human services office of the inspector
general, the Ohio department of insurance, or the Ohio department of
medicaid.
(C)
Notwithstanding divisions (A) and (B) of this section, a health care
contract may be amended by operation of law as required by any
applicable state or federal law, rule, or regulation. Nothing in this
section shall be construed to require the renegotiation of a health
care contract that is in existence before June 25, 2008, until the
time that the contract is renewed or materially amended.
Section
2.
That
existing sections 3963.01 and 3963.04 of the Revised Code are hereby
repealed.