General Assembly		Committee Bill No. 249
January Session, 2015		LCO No. 5605
		*_____SB00249PH____033015____*
Referred to Committee on PUBLIC HEALTH
Introduced by:
(PH)

AN ACT CONCERNING DISPUTES BETWEEN HOSPITALS OR HOSPITAL SYSTEMS AND HEALTH INSURERS.

Be it enacted by the Senate and House of Representatives in General Assembly convened:

Section 1. (NEW) (Effective July 1, 2015) (a) For contracts entered into, renewed or amended on or after July 1, 2015, if a hospital or hospital system, as defined in section 19a-486i of the general statutes, fails to reach an agreement with a health insurer to continue participating for at least one additional year in the network of health care providers with which the health insurer has contracted to provide covered health care services to its enrollees, at least one hundred twenty days prior to the expiration of the contract between the hospital or hospital system and the health insurer for participation in such network, either party to the contract may submit the issue of participation to binding arbitration pursuant to the provisions of this section.

(b) (1) Not later than five days following the submission of such issue to binding arbitration, the parties to the contract shall jointly select an arbitrator with experience in impartial arbitration of commercial disputes. If the parties fail to agree on an arbitrator, the selection of an arbitrator shall be made pursuant to the rules of the American Arbitration Association regarding the procedures for large, complex commercial disputes.

(2) Each party shall submit written briefs to the arbitrator selected pursuant to subdivision (1) of this subsection, and to the opposing party, setting forth a proposal as to how each of the unresolved issues with regard to participation should be resolved. The arbitrator shall convene a hearing to allow each party to present evidence and argument on its proposal. The arbitration record shall be officially closed upon the arbitrator's receipt of such briefs or the close of the hearing, whichever occurs later.

(3) The arbitrator's authority shall be limited to selecting the proposal of either party, in its entirety, on each such unresolved issue. The arbitrator shall issue a decision not later than forty-five days after the close of the arbitration record.

(4) The arbitrator shall consider the following factors in arriving at a decision in accordance with subdivision (3) of this subsection: (A) The needs and welfare of patients receiving in-network services pursuant to such contract or currently eligible for such services; (B) the needs and interests of the hospital or hospital system and the health insurer, including, but not limited to, each party's proposal set forth in its brief; (C) the history of negotiations between the parties, including, but not limited to, the negotiations leading up to arbitration; (D) any other contracts between the hospital or hospital system and another health insurer for participation in the network of health care providers with which such health insurer has contracted for the purpose of providing covered health care services to its enrollees; (E) any other contracts between the health insurer and another hospital or hospital system for participation in the network of health care providers with which such health insurer has contracted for the purpose of providing covered health care services to its enrollees; (F) current conditions and changes in the health care market and the community in which the hospital or hospital system is located; and (G) the interests and welfare of the employees of the hospital or hospital system.

(5) The costs or any fees associated with the arbitration shall be shared equally by each party. The arbitration award shall be final and binding, unless otherwise vacated or modified pursuant to the provisions of chapter 909 of the general statutes.

(6) If the arbitrator has not issued a decision pursuant to this subsection in advance of the expiration of the contract between the hospital or hospital system and the health insurer, such contract shall be extended until the date on which the decision is issued.

(c) If neither party to the contract submits to binding arbitration pursuant to subsection (a) of this section at least ninety days prior to the expiration of such contract, such contract shall be extended for one additional year. If such an extension occurs, the parties may modify, by mutual agreement, the terms of such contract, but may not reduce the one-year extension period or limit the participation of the hospital or hospital system in such network. No further extension or binding arbitration shall be required, provided either party gives public notice, at least six months prior to the termination of the one-year extension period, of its intention to terminate such contract upon the termination of such extension period.

This act shall take effect as follows and shall amend the following sections:
Section 1	July 1, 2015	New section

PH

Joint Favorable