Introduced Version






HOUSE BILL No. 1124

_____


DIGEST OF INTRODUCED BILL



Citations Affected: IC 2-5-23 ; IC 16-28.

Synopsis: Health facilities. Allows oral allegation of a breach of the health facilities law or rules. Requires the state department of health (state department) to investigate all breach allegations. Increases the potential fines for breaches. Allows the state department, after imposing a fine on a health facility, to deduct from the fine funds expended by the health facility to retain a consultant or other professional or to provide staff education or training to assist in correcting or preventing a breach. Establishes the quality improvement and education fund. Requires that 50% of the fines collected be deposited in this fund. Specifies that a penalty may be imposed for each violation or repeat of a violation. Limits to 90 the number of consecutive days that new admissions to a health facility may be suspended upon renewal of an order suspending admissions. Prohibits the collection from certain facilities of a fine under state law in addition to a monetary penalty under federal law. Assigns certain study topics to the health finance commission. Requires the state department to operate an informal dispute resolution program by contracting with an independent organization. Establishes procedures for the informal dispute resolution process.

Effective: July 1, 2000; September 1, 2000.





Day




    January 10, 2000, read first time and referred to Committee on Public Health.







Introduced

Second Regular Session 111th General Assembly (2000)


PRINTING CODE. Amendments: Whenever an existing statute (or a section of the Indiana Constitution) is being amended, the text of the existing provision will appear in this style type, additions will appear in this style type, and deletions will appear in this style type.
Additions: Whenever a new statutory provision is being enacted (or a new constitutional provision adopted), the text of the new provision will appear in this style type. Also, the word NEW will appear in that style type in the introductory clause of each SECTION that adds a new provision to the Indiana Code or the Indiana Constitution.
Conflict reconciliation: Text in a statute in this style type or this style type reconciles conflicts between statutes enacted by the 1999 General Assembly.

HOUSE BILL No. 1124



    A BILL FOR AN ACT to amend the Indiana Code concerning health.

Be it enacted by the General Assembly of the State of Indiana:

SOURCE: IC 2-5-23-5; (00)IN1124.1.1. -->     SECTION 1. IC 2-5-23-5 IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2000]: Sec. 5. The commission has the following voting membership:
        (1) The members of the senate planning health and public provider services committee.
        (2) The members of the house public health committee.
SOURCE: IC 2-5-23-13; (00)IN1124.1.2. -->     SECTION 2. IC 2-5-23-13 IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2000]: Sec. 13. (a) The chairman of the senate planning health and public service provider services committee is the chairman of the commission beginning May 1 of odd-numbered years and vice chairman beginning May 1 of even-numbered years.
    (b) The chairman of the house public health committee is the chairman of the commission beginning May 1 of even-numbered years and vice chairman beginning May 1 of odd-numbered years.
SOURCE: IC 16-28-3-3; (00)IN1124.1.3. -->     SECTION 3. IC 16-28-3-3 IS AMENDED TO READ AS FOLLOWS [EFFECTIVE SEPTEMBER 1, 2000]: Sec. 3. If a health

facility is in breach of this article or rules adopted under this article by offenses Level 4 breaches or patterns of deficiencies Level 3 breaches detrimental to the best interests of the public, the patients, or the health facility profession, the only type of license that may be issued to the health facility is a probationary license.

SOURCE: IC 16-28-4-1; (00)IN1124.1.4. -->     SECTION 4. IC 16-28-4-1 IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2000]: Sec. 1. A person who believes that this article or rules a rule adopted under this article have has been breached may file an allegation of breach with the state department. The allegation must may be made orally or in writing. unless the breach complained of is an offense or a deficiency. The state department shall reduce an oral allegation of breach shall be reduced to writing. by the state department.
SOURCE: IC 16-28-4-2; (00)IN1124.1.5. -->     SECTION 5. IC 16-28-4-2 IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2000]: Sec. 2. The division shall promptly investigate the following:
        (1) A written each allegation of breach received under this chapter.
        (2) An oral allegation of breach that the director, in the director's discretion, believes to have merit.
SOURCE: IC 16-28-5-1; (00)IN1124.1.6. -->     SECTION 6. IC 16-28-5-1 IS AMENDED TO READ AS FOLLOWS [EFFECTIVE SEPTEMBER 1, 2000]: Sec. 1. The executive board shall adopt rules under IC 4-22-2 to classify each rule adopted by the executive board to govern a health facility under this article define each level of breach of this article or rules adopted under this article as provided in subdivisions (1) through (4) of this section. The state survey inspectors shall determine under this article, with the concurrence of the director, the classification of a breach into one (1) of the following categories:
        (1) An offense, which presents a substantial probability that death or a life-threatening condition will result. (1) Level 4 - immediate jeopardy to patient health or safety (as described in 42 CFR 488.404).
        (2) A deficiency, which presents an immediate or a direct, serious adverse effect on the health, safety, security, rights, or welfare of a patient. (2) Level 3 - actual harm (as described in 42 CFR 488.404).
        (3) A noncompliance, which presents an indirect threat to the health, safety, security, rights, or welfare of a patient. (3) Level 2 - no actual harm with potential for more than minimal harm (as described in 42 CFR 488.404).
        (4) A nonconformance, which is any other classified breach not

covered by subdivision (1), (2), or (3). (4) Level 1 - no actual harm with potential for minimal harm (as described in 42 CFR 488.404).

SOURCE: IC 16-28-5-4; (00)IN1124.1.7. -->     SECTION 7. IC 16-28-5-4 IS AMENDED TO READ AS FOLLOWS [EFFECTIVE SEPTEMBER 1, 2000]: Sec. 4. (a) The commissioner shall impose the following remedies for breaches of this article or a rule adopted under this article:
        (1) For an offense, a Level 4 breach, the remedies specified in subsection (b)(1) through (b)(2). and (b)(3). The commissioner may also impose the remedy specified in subsection (b)(3). (b)(4).
        (2) For a Level 4 breach that is a repeat of the same Level 4 breach within a fifteen (15) month period, the remedies specified in subsection (b)(1) through (b)(2). The commissioner may also impose the remedies specified in subsection (b)(4).
         (3) For a deficiency, Level 3 breach, the remedies remedy specified in subsection (b)(1). The commissioner may also impose the remedies specified in subsection (b)(4). (b)(5).
        (3) (4) For a Level 3 breach that is a repeat of the same deficiency Level 3 breach within a fifteen (15) month period, the remedies specified in subsection (b)(1) through (b)(2). and (b)(3). The commissioner may also impose the remedy specified in subsection (b)(3). (b)(4).
        (4) (5) For a noncompliance, Level 2 breach, the remedies specified in subsection (b)(5) (b)(7) through (b)(6). (b)(8).
        (5) (6) For a breach that is a repeat of the same noncompliance Level 2 breach within a fifteen (15) month period, the remedies specified in subsection (b)(1). The commissioner may also impose the remedies specified in subsection (b)(4). (b)(6).
        (6) (7) For a nonconformance, Level 1 breach, the remedies remedy specified in subsection (b)(5). (b)(7).
        (7) For a breach that is a repeat of the same nonconformance within a fifteen (15) month period, the remedies specified in subsection (b)(5) through (b)(6).
    (b) The remedies for breaches of this article or rules adopted under this article are as follows:
        (1) Issuance of an order for immediate correction of the breach. (1) Submission of an acceptable plan of correction by the health facility.
        (2) Imposition of a fine not to exceed thirty thousand dollars ($30,000) or suspension of new admissions to the health facility for a period not to exceed forty-five (45) days, or both.
         (3) Imposition of a fine not to exceed ten twenty thousand dollars ($10,000) ($20,000) or suspension of new admissions to the health facility for a period not to exceed forty-five (45) days, or both.
        (3) (4) Revocation by the director of the health facility's license or issuance of a probationary license.
        (4) (5) Imposition of a fine not to exceed five ten thousand dollars ($5,000) ($10,000) or suspension of new admissions to the health facility for a period not to exceed thirty (30) days, or both. However, the state department may not impose a fine in excess of five thousand dollars ($5,000) for an isolated Level 3 violation unless a breach involves serious injury to or the death of a patient.
         (6) Imposition of a fine not to exceed five thousand dollars ($5,000) or suspension of new admissions to the health facility for a period not to exceed thirty (30) days, or both.
        (5) (7) A requirement that the health facility comply with any plan of correction approved or directed under section 7 of this chapter.
        (6) (8) If the health facility is found to have a pattern of breach, the commissioner may suspend new admissions to the health facility for a period not to exceed fifteen (15) days or impose a fine not to exceed one two thousand dollars ($1,000), ($2,000), or both.
    (c) If a fine is imposed on a health facility under this section, the commissioner may deduct from the fine money expended by the health facility to do either or both of the following to assist the health facility in correcting or preventing a breach of this article or a rule adopted under this article:
        (1) Retain a consultant or other health care professional approved by the director.
        (2) Provide training or education to staff members of the health facility.

     (d) If a breach is immediately corrected and the commissioner has imposed remedies under subsection (b)(2) or (b)(3), the commissioner may waive not more than fifty percent (50%) of the fine imposed and reduce the number of days for suspension of new admissions by one-half (1/2).
    (d) (e) The commissioner may, with the concurrence of a licensed physician, impose the following:
        (1) For an omission of care or an act that does not fall within a classification of a rule breach under this section and that the facility should reasonably have known would present a substantial

probability that death or a life threatening condition will result, one (1) or any combination of the remedies specified in subsection (b)(1), through (b)(3). (b)(2), and (b)(4).
        (2) For an omission of care or an act that:
            (A) does not fall within a classification of a rule breach under this section; and
            (B) the facility should reasonably have known would result in an immediate or a direct, serious adverse effect on the health, safety, security, rights, or welfare of a patient;
        the remedies specified in subsection (b)(1) or (b)(4), (b)(5), or both.
     (f) This section does not limit the authority of the commissioner to impose a fine or suspend new admissions to the health facility for each omission of care or act or repeat of an omission or act.
    (g) The commissioner may renew an order suspending admissions issued under this section for successive periods. However, the suspension of new admissions to a health facility under a renewed order may not exceed ninety (90) consecutive days.

SOURCE: IC 16-28-5-11; (00)IN1124.1.8. -->     SECTION 8. IC 16-28-5-11 IS ADDED TO THE INDIANA CODE AS A NEW SECTION TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2000]: Sec. 11. For a health facility that is certified for participation in Medicare under 42 U.S.C. 1395 et seq. or Medicaid under 42 U.S.C. 1396 et seq., the state department may not collect both a fine under this article and a civil monetary penalty under 42 CFR 488.
SOURCE: IC 16-28-11-1; (00)IN1124.1.9. -->     SECTION 9. IC 16-28-11-1 , AS AMENDED BY P.L.218-1999, SECTION 2, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2000]: Sec. 1. (a) Except as provided in IC 16-28-1-11 , and IC 16-28-7-4, fines or fees required to be paid under this article shall be paid directly to the director, who shall deposit the fines or fees in the state general fund.
     (b) Except as provided in IC 16-28-7-4 , fines required to be paid under this article shall be paid directly to the director, who shall deposit the fines as follows:
        (1) Fifty percent (50%) in the state general fund.
        (2) Fifty percent (50%) in the quality improvement and education fund established by section 4 of this chapter.

SOURCE: IC 16-28-11-4; (00)IN1124.1.10. -->     SECTION 10. IC 16-28-11-4 IS ADDED TO THE INDIANA CODE AS A NEW SECTION TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2000]: Sec. 4. (a) The quality improvement and education fund is established. The state department shall

administer the fund.
    (b) The treasurer of state shall invest the money in the fund not currently needed to meet the obligations of the fund in the same manner as other public funds may be invested. Interest that accrues from these investments shall be deposited in the fund.
    (c) Money in the fund at the end of a state fiscal year does not revert to the state general fund.
    (d) The state department shall use the money in the fund for the following purposes:
        (1) Education or training programs conducted by:
            (A) the state department; or
            (B) a health facility under IC 16-28-5-4 (c)(2).
        (2) Development of best practice guidelines and clinical protocols.
        (3) Clinical research and other activities designed to improve the quality of care provided in health facilities.
    (e) The state department may use money from the fund for an education or training program under subsection (d)(1)(B) only if the cost of the program is more than the amount deducted under IC 16-28-5-4 (c)(2). The total of:
        (1) the amount deducted under IC 16-28-5-4 (c)(2); and
        (2) the amount used from the fund under subsection (d)(1)(B);
may not exceed the cost of the education or training program conducted by the health facility.

SOURCE: ; (00)IN1124.1.11. -->     SECTION 11. [EFFECTIVE JULY 1, 2000] (a) As used in this SECTION, "commission" refers to the health finance commission established by IC 2-5-23.
    (b) As used in this SECTION, "health facility" has the meaning set forth in IC 16-18-2-167.
    (c) As used in this SECTION, "state department" refers to the state department of health established by IC 16-19.
    (d) The commission shall study the following:
        (1) Staffing of health facilities.
        (2) Training for employees of health facilities, including training on the special needs of individuals with Alzheimer's disease and other related disorders.
        (3) Possible alternatives for changing the method of investigating and resolving complaints involving health facilities by the state department.
        (4) Other topics assigned by the legislative council.
    (e) The commission shall issue a report of its findings regarding the topics assigned to the commission under subsection (d) to the legislative council not later than December 1, 2000.
    (f) This SECTION expires December 31, 2000.

SOURCE: ; (00)IN1124.1.12. -->     SECTION 12. [EFFECTIVE JULY 1, 2000] (a) As used in this SECTION, "IDR process" refers to the informal dispute resolution process required by 42 CFR 488.331 and this SECTION.
    (b) As used in this SECTION, "panel" refers to an informal dispute resolution panel appointed under subsection (g).
    (c) As used in this SECTION, "state department" refers to the state department of health established by IC 16-19.
    (d) The state department shall contract with an independent organization to operate the informal dispute resolution process required by 42 CFR 488.331.
    (e) The state department shall seek recommendations from the health facilities council created by IC 16-28-1-1 regarding the contract required under subsection (f).
    (f) The state department is not bound by the recommendations of the health facilities council provided under subsection (e).
    (g) The independent organization contracted by the state department under subsection (d) shall, for each dispute raised, establish an informal dispute resolution panel consisting of the following members:
        (1) An individual appointed by the state department.
        (2) An individual appointed by the independent organization.
    (h) The individual appointed by the state department under subsection (g)(1) may not have directly:
        (1) participated in; or
        (2) supervised any person involved with;
the survey under dispute.
    (i) The independent organization may appoint an additional individual to the panel for reasons including the following:
        (1) Disagreement between the individuals appointed under subsection (g).
        (2) Complex regulatory issues.
        (3) Complex medical issues.
    (j) The state department and the health facility may discuss with the independent organization the need to make changes to the composition of the panel.
    (k) The state department shall ensure that each member of the panel appointed under subsection (g):
        (1) has specific knowledge in:
            (A) clinical issues; and
            (B) survey and certification issues; and
        (2) does not have:
            (A) a financial interest in the outcome of the dispute

resolution; or
            (B) any other conflict of interest, as determined by criteria established by the state department.
    (l) Except as provided in subsection (m), the IDR process required under this SECTION may be conducted as a review of paperwork.
    (m) If requested by the health facility in its invocation of the IDR process under subsection (n), the IDR process must be conducted at an in-person meeting between the panel and representatives of the health facility.
    (n) To be given an informal opportunity to dispute survey findings, a health facility must submit a request in writing to the state health commissioner not more than ten (10) days after the date the health facility receives the official statement of the deficiencies.
    (o) A health facility may invoke the IDR process established under this SECTION for each violation cited by the state department.
    (p) The panel may request additional information from:
        (1) the state department; or
        (2) the health facility.
    (q) Failure to complete a timely informal dispute resolution request may not delay the effective date of any enforcement action against the health facility.
    (r) The health facility may not seek a delay of any enforcement action against the health facility on the grounds that the IDR process has not been completed before the effective date of the enforcement action.
    (s) An informal dispute resolution decision issued under this SECTION may be appealed by either the state department or the health facility.
    (t) The state department shall hold quarterly public meetings regarding the IDR process.
    (u) The state department shall prepare brief monthly reports on the outcome of informal dispute resolution decisions.
    (v) The reports required under subsection (u):
        (1) are public records; and
        (2) shall be submitted to the legislative council or a legislative body designated by the legislative council.
    (w) The state department shall submit a report to the legislative council, or a legislative body designated by the legislative council, regarding the state department's plans for informal dispute resolution upon the expiration of this SECTION.


    (x) The state department shall submit the report required under subsection (w) not later than January 1, 2002.
    (y) This SECTION expires June 30, 2002.