Massachusetts S 721: An Act relative to unilateral contract changes

Bill Text

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SENATE DOCKET, NO. 890 FILED ON: 1/18/2023
SENATE . . . . . . . . . . . . . . No. 721

The Commonwealth of Massachusetts
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PRESENTED BY:
John C. Velis
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To the Honorable Senate and House of Representatives of the Commonwealth of Massachusetts in General
Court assembled:
The undersigned legislators and/or citizens respectfully petition for the adoption of the accompanying bill:
An Act relative to unilateral contract changes.
_______________
PETITION OF:

NAME: DISTRICT/ADDRESS:
John C. Velis Hampden and Hampshire

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SENATE DOCKET, NO. 890 FILED ON: 1/18/2023
SENATE . . . . . . . . . . . . . . No. 721
By Mr. Velis, a petition (accompanied by bill, Senate, No. 721) of John C. Velis for legislation
relative to unilateral contract changes. Financial Services.

[SIMILAR MATTER FILED IN PREVIOUS SESSION
SEE SENATE, NO. 733 OF 2021-2022.]

The Commonwealth of Massachusetts

_______________
In the One Hundred and Ninety-Third General Court
(2023-2024)
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An Act relative to unilateral contract changes.

Be it enacted by the Senate and House of Representatives in General Court assembled, and by the authority
of the same, as follows:

1 SECTION 1. Section 13F of chapter 118E of the General Laws, as appearing in the 2022
2 Official Edition, is hereby amended by inserting at the end the following new paragraph:-
3 The division shall not make a contract with a health care provider which includes a
4 provision permitting termination without cause. The division shall provide a written statement to
5 a provider of the reason or reasons for such provider's involuntary disenrollment. The division
6 shall not make a contract with a health care provider which includes a provision permitting the
7 division to make a unilateral change to any material term or condition of such contract,
8 including, but not limited to, changes to underlying fee schedules, payment terms, carrier
9 policies or procedures, definitions of covered services or covered sites of services, policies
10 associated with utilization review, quality management and improvement, credentialing or

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11 covered preventive health services, other than a change expressly required by law, unless the
12 effective date of such unilateral change is after the end of the then-current term of such contract,
13 and notice of such change was provided, in writing, to the health care provider more than 90
14 days before the date by which the health care provider must provide notice of termination or non-
15 renewal to the division under such contract. Nothing herein shall prohibit the division and a
16 health care provider from entering into a mutually-agreeable amendment to such contract.
17 SECTION 2. Section 15 of chapter 176O of the General Laws, as appearing in the 2018
18 Official Edition, is hereby amended by striking out subsection j and inserting in place thereof the
19 following new subsection:-
20 (j) No carrier shall make a contract with a health care provider which includes a provision
21 permitting termination without cause. A carrier shall provide a written statement to a provider of
22 the reason or reasons for such provider's involuntary disenrollment. No carrier shall make a
23 contract with a health care provider which includes a provision permitting the carrier to make a
24 unilateral change to any material term or condition of such contract, including, but not limited to,
25 changes to underlying fee schedules, payment terms, carrier policies or procedures, definitions of
26 covered services or covered sites of services, policies associated with utilization review, quality
27 management and improvement, credentialing or covered preventive health services, other than a
28 change expressly required by law, unless the effective date of such unilateral change is after the
29 end of the then-current term of such contract, and notice of such change was provided, in
30 writing, to the health care provider more than 90 days before the date by which the health care
31 provider must provide notice of termination or non-renewal to the carrier under such contract.
32 Nothing herein shall prohibit a carrier and a health care provider from entering into a mutually-
33 agreeable amendment to such contract.

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34 SECTION 3. Section 4 of chapter 32A of the General Laws, as appearing in the 2018
35 Official Edition, is hereby amended by inserting after the first paragraph the following new
36 paragraph:-
37 The commission shall not purchase a policy providing health insurance benefits from an
38 insurance company whose contract with a healthcare provider under said policy includes a
39 provision permitting termination without cause. The commission shall not purchase a policy
40 providing health insurance benefits from an insurance company whose contract with a healthcare
41 provider under said policy includes a provision permitting the carrier to make a unilateral change
42 to any material term or condition of