Sec. 10.67.04.17. Subcontractual Relationships

A. Subcontracting Permitted.

(1) Consistent with this regulation, an MCO may subcontract services that it is required to provide to its enrollees under COMAR 10.67.06 to a health care provider that is licensed, certified, or otherwise legally authorized to provide those services.

(2) An MCO may not discriminate for the participation, reimbursement, or indemnification of any provider who is acting within the scope of the provider's license or certification under applicable State law, solely on the basis of that license or certification.

(3) An MCO shall have written agreements with subcontractors that comply with 42 CFR §§438.214 and 455.105, as amended, and include at least the following:

(a) A provision that the subcontractor be subject to all of the requirements to which the MCO is subject under its contract with the Department and pursuant to the Department's regulations;

(b) A clear description of the services to be performed under the subcontract sufficient to definitively inform the Department which of the MCO's obligations have been subcontracted;

(c) A provision for the subcontractor's release to the MCO and to the Department, upon request, of any information necessary for the MCO to perform any of its contractual and regulatory obligations under its contract with the Department, including, but not limited to, its records, reporting, and quality assurance duties;

(d) A provision requiring that the subcontractor complies with all State and federal requirements regarding audit, inspection, and evaluation;

(e) A provision that copies of the subcontractor's medical records pertaining to the MCO's enrollees shall be furnished to the MCO upon request for transfer to a subsequent provider in the event of a termination of the subcontract;

(f) A provision to the effect that no termination of the subcontract shall be effective without prior written notice to the Department;

(g) An agreement that the subcontractor will look solely to the MCO for compensation for covered services provided to the MCO's enrollees under the subcontract;

(h) An assurance that evidence of the subcontractor's professional liability coverage will be submitted annually to the MCO;

(i) A provision that no assignment of the subcontract by the subcontractor is effective without prior written notice to the Department;

(j) If the subcontractor is authorized by the MCO to make referrals, a provision requiring the subcontractor to use the uniform consultation referral form adopted by the Maryland Insurance Administration at COMAR 31.10.12.06;

(k) A provision to the effect that each provision of the subcontract that is required under this section supersede and be controlling over any conflicting terms that appear in the subcontract;

(l) A provision for revocation of the delegation of activities or obligations, or specifying other remedies in instances where the Department or the MCO determines that the subcontractor has not performed satisfactorily;

(m) A provision stating that the MCO has the right to audit the subcontractor pursuant to 42 CFR §438.230(c)(3)(i) for 10 years from the final date of the contract period or from the date of completion of any audit, whichever is later; and

(n) A provision to the effect that all providers and subcontractors are subject to a grievance and appeal system consistent with the requirements of COMAR 10.67.09.

(4) An MCO may not subcontract for hospital services with a hospital or an entity related to a hospital unless that hospital is in compliance with COMAR 10.37.12 (fixed price contracting regulations).

(5) An MCO may not prohibit or otherwise restrict a health care professional, acting within the lawful scope of practice, from advising or advocating on behalf of an enrollee who is the provider's patient for:

(a) The enrollee's health status, medical care, or treatment options, including any alternative treatment that may be self-administered;

(b) Any information the enrollee needs in order to decide among all relevant treatment options;

(c) The risks, benefits, and consequences of treatment or nontreatment; or

(d) The enrollee's right to participate in decisions regarding the enrollee's own health care, including the right to refuse treatment, and to express preferences about future treatment decisions.

B. Subcontractual Relations Reporting Requirements.

(1) An MCO shall submit its standard subcontract to the Department for its approval at least 30 days in advance of the MCO entering into any subcontracts covered by this regulation.

(2) An MCO shall submit to the Department for its prior approval material modifications to, or deviations from, its approved standard subcontract.

(3) An MCO shall submit to the Department a specification of procedures to be followed when reallocating responsibility in the event of a change in obligations in its approved standard subcontract.

(4) Network Provider Termination.

(a) When an MCO and provider terminate their contract the MCO shall provide the Department with a written notice regarding the termination.

(b) If the MCO is terminating the contract, the notice required in §B(4)(a) of this regulation shall be provided 90 days before the effective date of the termination.

(c) If the provider is terminating the contract, the notice required in §B(4)(a) of this regulation shall be provided within 15 days after the MCO receives the notice from the terminating provider.

(d) If 50 to 99 enrollees are affected, the notice shall contain the:

(i) Date of termination;

(ii) Name or names of providers or subcontractors terminating;

(iii) Number of enrollees affected; and

(iv) MCO's plan for transitioning enrollees to other providers.

(e) If more than 99 enrollees are affected, the MCO shall provide the Department with a Department-approved termination survey.

(f) In determining the number of enrollees affected under §B(4)(d) and (e) of this regulation, the MCO shall consider:

(i) For PCPs, the number of enrollees assigned to the PCP; and

(ii) For all other providers, the number of enrollees who are in active treatment or who have had an encounter with the provider in the previous 12 months.

(5) Subcontractor Termination.

(a) When an MCO terminates a subcontract impacting its operations, covered services, or enrollees, the MCO shall provide the Department with written notice regarding the termination that describes:

(i) The dollar amount of the subcontract;

(ii) The effect of the termination on MCO operations;

(iii) The effect of the termination on MCO covered services or enrollees; and

(iv) The MCO’s plan to replace the subcontractor, if applicable.

(b) If the termination of the subcontract impacts MCO operations, the notice required in §B(5)(a) of this regulation shall be provided at least 90 days before the effective date of the termination.

C. By entering into a subcontract to provide health care services on behalf of an MCO, the subcontractor becomes subject to all the requirements concerning audits and inspections by the Department and other government agencies that are imposed upon the MCO by statute or regulation, or by its contract with the Department.

D. An MCO shall monitor the performance of its subcontractors, including, but not limited to, the areas of enrollee and provider complaints, access issues, quality assurance activities, record keeping, and reporting requirements.

E. An MCO shall report to the Department any material deviations from required procedures by its subcontractor which, in the MCO's judgment, can be expected to have a significant effect on quality of care, or on enrollees' ability to access care.