Part II. Administrative Services
12VAC5-408-160. Management and administration.
A. No person shall establish or operate a managed care health insurance plan in Virginia without first obtaining a license from the Bureau of Insurance and a certificate of quality assurance from the department.
B. The MCHIP licensee must comply with:
1. This chapter;
2. Other applicable federal, state or local laws and regulations; and
3. The MCHIP licensee's own policies and procedures.
C. The MCHIP licensee shall submit or make available reports and information as described in § 32.1-137.4 of the Code of Virginia necessary to establish compliance with these standards and applicable laws.
D. The MCHIP licensee shall permit representatives from the center to conduct examinations or reviews to:
1. Verify application information;
2. Determine compliance with these standards;
3. Review necessary records, including contracts for delegated services and capitated rate information; and
4. Investigate complaints and review appeals procedures.
E. The licensee shall notify the center and providers in writing within 30 days of implementing any material changes affecting the MCHIP licensee, including:
1. Mailing address;
2. Ownership;
3. Health care services provided, including any delegated services;
4. Medical director;
5. MCHIP or licensee name;
6. Significant provider network changes; and
7. Any material changes in the quality assurance program, complaint process, or utilization review process.
If more advanced notice of a specific change is required by law for notices to providers or covered persons, notice given to the department under this section shall be no less than notice given to covered persons under the law.
F. All applications, including those for renewal, shall require:
1. A description of the geographic area to be served with a map clearly delineating the boundaries of the service area or areas;
2. A description of the complaint system required under § 32.1-137.6 of the Code of Virginia and 12VAC5-408-130;
3. A description of the procedures and programs established by the licensee to assure both availability and accessibility of adequate personnel and facilities;
4. A list of the MCHIP licensee's managed care health insurance plans; and
5. A description of the MCHIP's quality assurance program.
G. In addition, applications shall include the following:
1. A detailed description of the MCHIP's prescription drug benefit program, if one is offered;
2. If the MCHIP requires or performs utilization management, the utilization review plan including a description of the criteria, clinical and therapeutic guidelines, and their derivation or source;
3. A description of the MCHIP licensee's credentialing process;
4. The current provider directory, so that the department can determine whether it complies with subsection G of § 38.2-3407.10 of the Code of Virginia;
5. A copy of the MCHIP's evidence of coverage or insurance plan coverage limitations and exclusions and other information provided to covered persons;
6. A description of all types of payment arrangements that the MCHIP licensee uses to compensate providers for health care services rendered to covered persons, including, but not limited to, withholds, bonus payments, capitation, processing fees, and fee-for-service discounts; and
7. For those MCHIP licensees that conduct clinical studies, a list of clinical studies with abstracts of study design, objectives and, if available, results as applicable to the type of MCHIP licensee.
H. A list demonstrating the health care services, as required by law, that the licensee provides, arranges, pays for, or reimburses shall be appropriately integrated throughout the MCHIP's service area. Services shall be based upon prevailing nationally recognized standards of medical practice.
I. The licensee shall have a written policy stating the MCHIP licensee treats covered persons in a manner that respects their rights as well as its expectations of provider and covered person responsibilities. The services shall be accessible to all covered persons, including those with diverse cultural and ethnic backgrounds, and those with physical and mental disabilities.
Statutory Authority
§ 32.1-137.1 of the Code of Virginia.
Historical Notes
Derived from Virginia Register Volume 16, Issue 7, eff. January 20, 2000; amended, Virginia Register Volume 18, Issue 8, eff. January 30, 2002.
12VAC5-408-170. Provider credentialing and recredentialing.
A. The MCHIP licensee shall establish and maintain a comprehensive credentialing verification program to ensure its providers meet the minimum standards of professional licensure or certification. Written supporting documentation for providers who have completed their residency or fellowship requirements for their specialty area more than 12 months prior to the credentialing decision shall include:
1. Current valid license and history of licensure or certification;
2. Status of hospital privileges, if applicable;
3. Valid DEA certificate, if applicable;
4. Information from the National Practitioner Data Bank, as available;
5. Education and training, including post graduate training, if applicable;
6. Specialty board certification status, if applicable;
7. Practice or work history covering at least the past five years; and
8. Current, adequate malpractice insurance and malpractice history of at least the past five years.
B. The MCHIP licensee may grant provisional credentialing for providers who have completed their residency or fellowship requirements for their specialty area within 12 months prior to the credentialing decision. Written supporting documentation necessary to provisionally credential a practitioner shall include:
1. Primary source verification of a current, valid license to practice prior to granting the provisional status;
2. Written confirmation of the past five years of malpractice claims or settlements, or both, from the malpractice carrier or the results of the National Practitioner Data Bank query prior to granting provisional status; and
3. A completed application and signed attestation.
C. Providers provisionally credentialed may remain so for 60 calendar days.
D. Policies for credentialing and recredentialing shall include:
1. Criteria used to credential and recredential;
2. Process used to make credentialing and recredentialing decisions;
3. Type of providers, including network providers, covered under the credentialing and recredentialing policies;
4. Process for notifying providers of information obtained that varies substantially from the information provided by the provider;
5. Process for receiving input from participating providers to make recommendations regarding the credentialing and recredentialing process; and
6. A requirement that the MCHIP licensee notify the applicant within 60 calendar days of receipt of an application if information is missing or if there are other deficiencies in the application. The MCHIP licensee shall complete the credentialing process within 90 calendar days of the receipt of all such information requested by the MCHIP licensee or, if information is not requested from the applicant, within 120 calendar days of receipt of an application. If there is a contractual relationship between the MCHIP licensee and the applicant or entity for whom the applicant is employed or engaged, the timeframes for notification that the application is not complete and completion of the credentialing process shall be in accordance with the protocols and procedures established by the MCHIP licensee under subsection O of this section. The department may impose administrative sanctions upon an MCHIP licensee for failure to complete the credentialing process as provided in this section if the department finds that such failure occurs with such frequency as to constitute a general business practice.
The policies shall be made available to participating providers and applicants upon written request.
E. A provider fully credentialed by an MCHIP licensee, who changes his place of employment or his nonMCHIP licensee employer, shall, if within 60 calendar days of such change and if practicing within the same specialty, continue to be credentialed by that MCHIP licensee upon receipt by the MCHIP licensee of the following:
1. The effective date of the change;
2. The new tax ID number and copy of W-9, as applicable;
3. The name of the new practice, contact person, address, and telephone and fax numbers; and
4. Other such information as may materially differ from the most recently completed credentialing application submitted by the provider to the MCHIP licensee.
This provision shall not apply if the provider's prior place of employment or employer had been delegated credentialing responsibility by the MCHIP licensee.
Nothing in this section shall be construed to require an MCHIP licensee to contract or recontract with a provider.
F. The providers shall be recredentialed at least every three years. Recredentialing documentation shall include:
1. Current valid license or certification;
2. Status of hospital privileges, if applicable;
3. Current valid DEA registration, if applicable;
4. Specialty board eligibility or certification status, if applicable;
5. Data from covered person complaints and the results of quality reviews, utilization management reviews, and covered persons satisfaction surveys, as applicable; and
6. Current, adequate malpractice insurance and history of malpractice claims and professional liability claims resulting in settlements or judgments.
G. All information obtained in the credentialing process shall be subject to review and correction of any erroneous information by the health care provider whose credentials are being reviewed. Nothing in the previous sentence shall require an MCHIP or MCHIP licensee to disclose to a provider, or any other person or party, information or documents (i) that the MCHIP or the MCHIP licensee, itself, develops or causes to be developed as part of the MCHIP's credentialing process or (ii) that are privileged under applicable law. The department may require the MCHIP licensee to provide a copy of its credentialing policies.
H. Providers shall be required by the MCHIP licensee to notify the MCHIP of any changes in the status of any credentialing criteria.
I. The MCHIP licensee shall not refuse to initially credential or refuse to reverify the credentials of a health care provider solely because the provider treats a substantial number of patients who require expensive or uncompensated care.
J. The MCHIP licensee shall have policies and procedures for altering the conditions of the provider's participation with the MCHIP licensee. The policies shall include actions to be taken to improve performance prior to termination and an appeals process for instances when the MCHIP licensee chooses to alter the condition of provider participation based on issues of quality of care or service, except in circumstances where a covered person's health has been jeopardized. Providers shall have complete and timely access to all data and information used by the licensee to identify or determine the need for altering the conditions of participation.
K. The MCHIP licensee shall retain the right to approve new providers and sites based on quality issues and to terminate or suspend individual providers. Termination or suspension of individual providers for quality of care considerations shall be supported by documented records of noncompliance with specific MCHIP expectations and requirements for providers. The provider shall have a prescribed system of appeal of this decision available to the provider as prescribed in the contract between the MCHIP or its delegated service entity and the provider.
L. Providers shall be informed of the appeals process. Profession specific providers actively participating in the MCHIP plan shall be included in reviewing appeals and making recommendations for action.
M. The MCHIP licensee shall notify appropriate authorities when a provider's application or contract is suspended or terminated because of quality deficiencies by the health care provider whose credentials are being reviewed.
N. There shall be an organized system to manage and protect the confidentiality of personnel files and records. Records and documents relating to a provider's credentialing application shall be retained for at least seven years.
O. The MCHIP licensee shall establish protocols and procedures for processing new provider credentialing applications and reimbursing new provider applicants, after being credentialed by the MCHIP licensee, for health care services provided to covered persons during the period in which the approved applicant's completed credentialing application was pending. At a minimum, the protocols and procedures shall require the following:
1. If the MCHIP licensee accepts applications through an online credentialing system, the MCHIP licensee shall notify a new provider applicant through the online credentialing system that the provider has submitted and attested to the application as notice by the carrier that the application is received. If the MCHIP licensee does not accept applications through an online credentialing system, the MCHIP licensee shall within 10 days of receiving an application provide notification to the new provider applicant either by postal mail or electronic mail, as selected by the applicant, that the application was received;
2. Beginning January 1, 2024, a new provider applicant's application is deemed complete within 30 days of the MCHIP licensee receiving the application, unless the MCHIP licensee has provided notice that the application is not complete. Notice shall be provided by electronic mail unless the provider applicant has selected notification by postal mail;
3. The MCHIP licensee shall approve or deny a new provider applicant credentialing application within 60 days of receiving a completed application;
4. Claims submitted according to the MCHIP licensee's claims submittal policies for services rendered during the period of a pending application shall be adjudicated and paid no later than 40 days after the new provider applicant is credentialed and contracted;
5. The protocols and procedures shall apply only if a contractual relationship exists between the MCHIP licensee and the new provider applicant or entity for whom the new provider applicant is employed or engaged; and
6. Any reimbursement shall be paid at the in-network rate that the new provider applicant would have received had the provider been, at the time the covered health care services were provided, a credentialed participating provider in the network for the applicable managed care plan.
P. Nothing in this section shall require:
1. Reimbursement of provider-rendered services that are not benefits or services covered by the MCHIP licensee's managed care plan.
2. An MCHIP licensee to pay reimbursement at the contracted in-network rate for any covered health care services provided by the new provider applicant if the new provider applicant's credentialing application is not approved or the MCHIP licensee is otherwise not willing to contract with the new provider applicant.
Q. Payments made or retroactive denials of payments made under this section shall be governed by § 38.2-3407.15 of the Code of Virginia.
R. If a payment is made by the MCHIP licensee to a new provider applicant or any entity that employs or engages a new provider applicant under this section for a covered service, the patient shall only be responsible for any coinsurance, copayments, or deductibles permitted under the insurance contract with the MCHIP licensee or participating provider agreement with the provider.
S. A new provider applicant, in order to submit claims to the MCHIP licensee pursuant to this section, shall provide written or electronic notice to covered persons in advance of treatment that:
1. The provider has submitted a credentialing application to the MCHIP licensee of the covered person; and
2. The MCHIP licensee is in the process of obtaining and verifying the written documentation from the new provider applicant pursuant to subsection A of this section.
The written or electronic notice shall conform to the requirements in § 38.2-3407.10:1 G of the Code of Virginia.
Statutory Authority
§§ 32.1-12 and 32.1-137.3 of the Code of Virginia.
Historical Notes
Derived from Virginia Register Volume 16, Issue 7, eff. January 20, 2000; amended, Virginia Register Volume 18, Issue 8, eff. January 30, 2002; Volume 37, Issue 14, eff. April 15, 2021; Volume 40, Issue 5, eff. November 22, 2023.
12VAC5-408-180. Complaint system.
A. Every MCHIP licensee shall establish and maintain a system for the resolution of complaints brought by covered persons, or by providers acting on behalf of an covered person and with the covered person's consent, including complaints regarding availability, delivery, or quality of health care services, or any other matter pertaining to the covered person's contractual relationship or status as a third party beneficiary with the MCHIP.
The system shall include:
1. Written notification to all covered persons of the procedures, including telephone numbers and addresses, for contacting the MCHIP with a complaint and telephone numbers and addresses of the complaint unit of the center and the Office of the Managed Care Ombudsman to help with complaints or appeals;
2. A description of the process used to investigate and resolve complaints, including specific time lines for each step in the complaint process; and
3. A description of the process used to document and track the status of all complaints and compile the complaint information required to be reported to the department under § 32.1-137.6 C of the Code of Virginia.
B. Time lines for responding to complaints shall accommodate clinical urgency and shall not exceed 30 days from receipt of the complaint. Resolution of complaints shall not exceed 60 days from date of receipt of the complaint.
C. The MCHIP licensee shall keep records of complaints filed including:
1. Complaint identifier, using a unique identification code assigned consistently to the covered person;
2. Date complaint received;
3. A general description of the reason for the complaint;
4. Date of each review and hearing, if any;
5. The number of days to gather the information necessary to resolve the complaint;
6. Date closed;
7. Resolution of the complaint;
8. Record of internal actions necessary as a result of the complaint resolution, as applicable; and
9. Notification to the covered person of the resolution.
D. No covered person who exercises the right to file a complaint or an appeal shall be subject to disenrollment or otherwise penalized due to the filing of a complaint or appeal.
E. Complaint records shall be maintained from the date of the MCHIP licensee's last examination and for no less than five years.
F. A description of the systems for filing complaints and appeals shall be provided to covered persons at the time of enrollment and upon request thereafter.
Statutory Authority
§ 32.1-137.1 of the Code of Virginia.
Historical Notes
Derived from Virginia Register Volume 16, Issue 7, eff. January 20, 2000; amended, Virginia Register Volume 18, Issue 8, eff. January 30, 2002.
12VAC5-408-190. Covered person education and communication.
A. The MCHIP licensee shall make available to each covered person at the time of enrollment or at the time the contract or evidence of coverage is issued, as required by law and upon request thereafter, policies and procedures applicable to the covered person including, but not limited to:
1. A statement of covered person's rights and responsibilities;
2. Procedures for obtaining care including:
a. Referral and authorization requirements;
b. Primary care services;
c. Specialty care and hospital services;
d. Behavioral services, when the complexity of the covered person's condition requires the knowledge base and expertise beyond those of the primary care provider;
e. Emergency services and after-hours coverage, including access to emergency care, and any requirements for prior authorization and payment for out-of-service areas;
f. Care and coverage when out of the service area;
g. Out-of-network services; and
h. Pharmacy services;
3. Procedures concerning the complaint process and the process for appealing adverse decisions affecting covered person coverage benefits;
4. To the extent there are coverage restrictions for changing primary care providers, procedures for changing primary care and specialty care providers including any restrictions on changing providers;
5. All necessary mailing addresses and telephone numbers for seeking information or authorization;
6. The toll-free number for the complaint unit of the center; and
7. Notice of the right to obtain information on types of provider payment arrangements used to compensate providers for health care services rendered to covered persons, including, but not limited to, withholds, bonus payments, capitation, processing fees, and fee-for-service discounts.
B. Lists of all network providers shall be made available to covered persons as required in subsection G of § 38.2-3407.10 of the Code of Virginia.
C. There shall be a mechanism for providing covered person information in plain language that is clearly understood and in the languages of the major population groups served.
D. Covered persons shall be provided an opportunity for input regarding the service provided by the MCHIP and any mechanism for input shall be disclosed to them.
E. There shall be a mechanism for assisting covered persons affected by changes in the MCHIP licensee's service areas or network providers. Such mechanisms may include access to information through an internet website, a toll-free telephone number, an electronic copy of the MCHIP's current provider directory, newsletters or any combination thereof.
Statutory Authority
§ 32.1-137.1 of the Code of Virginia.
Historical Notes
Derived from Virginia Register Volume 16, Issue 7, eff. January 20, 2000; amended, Virginia Register Volume 18, Issue 8, eff. January 30, 2002.
12VAC5-408-200. Data management.
A. The data management system shall be reasonable and adequate to assess, measure and evaluate the functions of the quality assurance program.
B. If the MCHIP licensee has healthcare data and information, the data management system, which includes medical records, shall comply with federal and state law and regulations, including the Virginia Health Records Privacy Act (§ 32.1-127.1:03 of the Code of Virginia).
Statutory Authority
§ 32.1-137.1 of the Code of Virginia.
Historical Notes
Derived from Virginia Register Volume 16, Issue 7, eff. January 20, 2000; amended, Virginia Register Volume 18, Issue 8, eff. January 30, 2002.
12VAC5-408-210. Medical records.
A. The MCHIP licensee shall require that an organized medical record system be maintained by providers that assures the availability of information required for effective and continuous covered person care and for quality received.
B. Medical records shall be confidential. Only authorized personnel shall have access as specified in § 32.1-127.1:03 of the Code of Virginia. Written procedures shall govern the use and removal of medical records and the conditions for release of information. The covered person's written consent shall be required for release of information as required by law.
Statutory Authority
§ 32.1-137.1 of the Code of Virginia.
Historical Notes
Derived from Virginia Register Volume 16, Issue 7, eff. January 20, 2000; amended, Virginia Register Volume 18, Issue 8, eff. January 30, 2002.