42-7.4-3. Imposition of healthcare services funding contribution.

(a) Each insurer is required to pay the healthcare services funding contribution for each

contribution enrollee of the insurer at the time the contribution is calculated and paid, at the rate set

forth in this section.

(1) Beginning January 1, 2016, the secretary shall set the healthcare services funding

contribution each fiscal year in an amount equal to: (i) The child immunization funding requirement

described in § 23-1-46; plus (ii) The adult immunization funding requirement described in § 23-1-

46; plus (iii) The children’s health services funding requirement described in § 42-12-29; and all

as divided by (iv) The number of contribution enrollees of all insurers.

(2) The contribution set forth herein shall be in addition to any other fees or assessments

upon the insurer allowable by law.

(b) The contribution shall be paid by the insurer; provided, however, a person providing

health benefits coverage on a self-insurance basis that uses the services of a third-party

administrator shall not be required to make a contribution for a contribution enrollee where the

contribution on that enrollee has been or will be made by the third-party administrator.

(c) Beginning calendar year 2026, and sunsetting effective October 1, 2026, in addition to

the assessment collection pursuant to subsection (a), there shall be an additional amount assessed

pursuant to (i) and (ii), to support primary care and other critical healthcare programs totaling thirty

million dollars ($30,000,000) annualized , which shall be deposited as general revenues.

SECTION 16. Section 42-14.5-2.1 of the General Laws in Chapter 42-14.5 entitled "The

Rhode Island Health Care Reform Act of 2004 — Health Insurance Oversight" is hereby amended

to read as follows:

28 42-14.5-2.1. Definitions.

As used in this chapter:

(1) “Accountability standards” means measures including service processes, client and

population outcomes, practice standard compliance, and fiscal integrity of social and human service

providers on the individual contractual level and service type for all state contracts of the state or

any subdivision or agency to include, but not limited to, the department of children, youth and

families (DCYF), the department of behavioral healthcare, developmental disabilities and hospitals

(BHDDH), the department of human services (DHS), the department of health (DOH), and

Medicaid. This may include mandatory reporting, consolidated, standardized reporting, audits

regardless of organizational tax status, and accountability dashboards of aforementioned state

departments or subdivisions that are regularly shared with the public.

(2) "Accountable care organization" means, for the purposes of § 42-14.5-3.2, a provider

organization contracted with one or more payers and held accountable for the quality of health care,

outcomes and total cost of care of an attributed commercial and/or Medicare population.

(3) "Accountable entity" means, for the purposes of § 42-14.5-3.2, a provider organization

contracted with one or more Rhode Island Medicaid insurers and held accountable for the quality

of health care, outcomes and total cost of care of an attributed Medicaid population.

(2) (4) “Executive Office of Health and Human Services (EOHHS)” means the department

that serves as “principal agency of the executive branch of state government” (§ 42-7.2-2)

responsible for managing the departments and offices of: health (RIDOH), human services (DHS),

healthy aging (OHA), veterans services (VETS), children, youth and families (DCYF), and

behavioral healthcare, developmental disabilities and hospitals (BHDDH). EOHHS is also

designated as the single state agency with authority to administer the Medicaid program in Rhode

Island.

(5) "Healthcare cost growth target" means the targeted annual per capita growth rate for

Rhode Island’s total healthcare spending, expressed as the percentage growth from the prior year’s

per capita spending.

(6) "Large provider entity" means a provider organization contracted with one or more

payers that, at a minimum, includes professional providers to whom patients can be attributed, and

that collectively, during any given calendar year, has at least sixty thousand (60,000) attributed

member months across payers in the commercial, Medicaid or Medicare market, enabling the

organization to participate in total cost of care contracts, even if it is not engaged in a total cost of

care contract as an Accountable Care Organization or a Medicaid Accountable Entity.

(7) "Market" means the highest level of categorization of the health insurance market and

shall include Medicare Fee-For-Service and Medicare Managed Care, collectively referred to as

the "Medicare market;" Medicaid Fee-for-Service and Medicaid Managed Care, collectively

referred to as the "Medicaid market;" and individual, self-insured, small and large group markets

and student health insurance, collectively referred to as the "commercial market."

(8) "Net cost of private health insurance" means the costs to Rhode Island residents

associated with the administration of private health insurance, including Medicare Managed Care

and Medicaid Managed Care. It is defined as the difference between health premiums earned and

benefits incurred, and consists of insurers’ costs of paying bills, advertising, sales commission and

other administrative costs, premium taxes, and profits (or contributions to reserves) or losses.

(9) "Payer" means any public payer, including Medicaid and Medicare; any health insurer

offering Medicaid Managed Care or Medicare Managed Care plans in Rhode Island; any

commercial health insurer, defined as an entity subject to the insurance laws and regulations of

Rhode Island, or subject to the jurisdiction of the health insurance commissioner, that contracts or

offers to contract to provide, deliver, arrange for, pay for, or reimburse any of the costs of healthcare

services including, without limitation, an insurance company offering accident and sickness

insurance, a health maintenance organization, a nonprofit hospital service corporation, a nonprofit

medical service corporation, and a nonprofit hospital and medical service corporation; and any

commercial health insurer that provides benefit administration for self-insured employers or labor

trusts, or both.

(10) "Pharmaceutical manufacturer" means any entity holding legal title to or possession

of a national drug code number issued by the federal Food and Drug Administration.

(11) "Pharmacy benefit manager" has the same meaning as defined in § 27-19-26.2.

(12) "Primary care expenditures" means all claims-based and non-claims-based payments

by commercial health insurers, Medicaid, and Medicare directly to a primary care practice or

accountable care organization for primary care services delivered to Rhode Island residents at a

primary care site of care, which shall include a primary care outpatient setting, federally qualified

health center, school-based health center, or via telehealth, but shall not include a third-party

telehealth vendor that does not contract with such sites of care to deliver services. A primary care

site of care also does not include urgent care centers or retail pharmacy clinics.

(3) (13) “Primary care services” means, for the purposes of reporting required under § 42-

14.5-3(t), professional services rendered by primary care providers at a primary care site of care,

including care management services performed in the context of team-based primary care.

(14) "Provider" has the same meaning as defined in §§ 27-18-1.1, 27-19-1, and 27-20-1.

(4) (15) “Rate review” means the process of reviewing and reporting of specific trending

factors that influence the cost of service that informs rate setting.

(5) (16) “Rate setting” means the process of establishing rates for social and human service

programs that are based on a thorough rate review process.

(6) (17) “Social and human service program” means a social, mental health, developmental

disability, child welfare, juvenile justice, prevention services, habilitative, rehabilitative, substance

use disorder treatment, residential care, adult or adolescent day services, vocational, employment

and training, or aging service program or accommodations purchased by the state.

(7) (18) “Social and human service provider” means a provider of social and human service

programs pursuant to a contract with the state or any subdivision or agency to include, but not be

limited to, the department of children, youth and families (DCYF), the department of behavioral

healthcare, developmental disabilities and hospitals (BHDDH), the department of human services

(DHS), the department of health (DOH), and Medicaid.

(8) (19) “State government and the provider network” refers to the contractual relationship

between a state agency or subdivision of a state agency and private companies the state contracts

with to provide the network of mandated and discretionary social and human services.

(20) "Total healthcare expenditures" means the total medical expense incurred by Rhode

Island residents for all healthcare services for all payers reporting to the office of the health

insurance commissioner, inclusive of prescription drugs, plus their net cost of private health

insurance.

(21) "Total medical expense" means the sum of the allowed amount of total claims and

total non-claims spending paid to providers, inclusive of prescription drugs, incurred by Rhode

Island residents for all healthcare services.

SECTION 17. Chapter 42-14.5 of the General Laws entitled "The Rhode Island Health

Care Reform Act of 2004 — Health Insurance Oversight" is hereby amended by adding thereto the

following section: