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First Substitute H.B. 256

Representative James A. Dunnigan proposes the following substitute bill:


             1     
CHILDREN'S HEALTH INSURANCE AND MEDICAID

             2     
ADMINISTRATIVE SIMPLIFICATION

             3     
2011 GENERAL SESSION

             4     
STATE OF UTAH

             5     
Chief Sponsor: James A. Dunnigan

             6     
Senate Sponsor: Daniel R. Liljenquist

             7     
             8      LONG TITLE
             9      General Description:
             10          This bill modifies provisions relating to Medicaid and other children's health insurance
             11      programs.
             12      Highlighted Provisions:
             13          This bill:
             14          .    requires the Department of Health to:
             15              .    apply for grants to fund a simplified enrollment and renewal process for
             16      Medicaid, Utah Premium Partnership, and Primary Care Network
             17      Demonstration Project programs; and
             18              .    if funding is available, establish a simplified enrollment and renewal process for
             19      the programs in which the eligibility worker may, if the applicant provides
             20      consent, confirm the adjusted gross income of the applicant from the State Tax
             21      Commission;
             22          .    allows the Department of Health or its designee to:
             23              .    enter into agreements with financial institutions to develop and operate a data
             24      system to identify an applicant or enrollee's assets; and
             25              .    pay a reasonable fee to a financial institution for services;


             26          .    requires the Division of Health Care Financing to:
             27              .    bid out Medicaid dental benefits;
             28              .    establish criteria for bidding out Medicaid dental benefits; and
             29              .    rebid the Medicaid dental benefits at least once every five years;
             30          .    requires the Children's Health Insurance Plan to apply for grants to fund a simplified
             31      enrollment process;
             32          .    when funding is available, requires the Children's Health Insurance Plan to establish
             33      a simplified enrollment process in which the eligibility worker may, if the applicant
             34      provides consent, confirm the adjusted gross income of the applicant from the State
             35      Tax Commission; and
             36          .    requires the State Tax Commission to provide the Department of Health or its
             37      designee with access to an applicant's adjusted gross income.
             38      Money Appropriated in this Bill:
             39          None
             40      Other Special Clauses:
             41          This bill takes effect on July 1, 2012.
             42      Utah Code Sections Affected:
             43      AMENDS:
             44          7-1-1006, as last amended by Laws of Utah 2010, Chapter 65
             45          26-40-105, as last amended by Laws of Utah 2010, Chapter 67
             46          59-1-403, as last amended by Laws of Utah 2010, Chapters 6 and 67
             47      ENACTS:
             48          26-18-2.5, Utah Code Annotated 1953
             49          26-18-2.6, Utah Code Annotated 1953
             50     
             51      Be it enacted by the Legislature of the state of Utah:
             52          Section 1. Section 7-1-1006 is amended to read:
             53           7-1-1006. Inapplicable to certain official investigations.
             54          (1) Sections 7-1-1002 and 7-1-1003 do not apply if an examination of a record is a part
             55      of an official investigation by:
             56          (a) local police;


             57          (b) a sheriff;
             58          (c) a peace officer;
             59          (d) a city attorney;
             60          (e) a county attorney;
             61          (f) a district attorney;
             62          (g) the attorney general;
             63          (h) the Department of Public Safety;
             64          (i) the Office of Recovery Services of the Department of Human Services;
             65          (j) the Insurance Department;
             66          (k) the Department of Commerce;
             67          (l) the Benefit Payment Control Unit or the Payment Error Prevention Unit of the
             68      Department of Workforce Services;
             69          (m) the state auditor; [or]
             70          (n) the State Tax Commission[.]; or
             71          (o) the Department of Health or its designee, when undertaking an official
             72      investigation to determine whether an individual qualifies for certain assistance programs as
             73      provided in Section 26-18-2.5 .
             74          (2) Except for the Office of Recovery Services, if a governmental entity listed in
             75      Subsection (1) seeks a record, the entity shall obtain the record as follows:
             76          (a) if the record is a nonprotected record, by request in writing that:
             77          (i) certifies that an official investigation is being conducted; and
             78          (ii) is signed by a representative of the governmental entity that is conducting the
             79      official investigation; or
             80          (b) if the record is a protected record, by obtaining:
             81          (i) a subpoena authorized by statute;
             82          (ii) other legal process:
             83          (A) ordered by a court of competent jurisdiction; and
             84          (B) served upon the financial institution; or
             85          (iii) written permission from all account holders of the account referenced in the record
             86      to be examined.
             87          (3) If the Office of Recovery Services seeks a record, the Office of Recovery Services


             88      shall obtain the record pursuant to:
             89          (a) Subsection 62A-11-104 (1)(g);
             90          (b) Section 62A-11-304.1 ;
             91          (c) Section 62A-11-304.5 ; or
             92          (d) Title IV, Part D of the Social Security Act as codified in 42 U.S.C. 651 et seq.
             93          (4) A financial institution may not give notice to an account holder or person named or
             94      referenced within the record disclosed pursuant to Subsection (2)(a).
             95          (5) In accordance with Section 7-1-1004 , the governmental entity conducting the
             96      official investigation that obtains a record from a financial institution under this section shall
             97      reimburse the financial institution for costs reasonably and directly incurred by the financial
             98      institution.
             99          Section 2. Section 26-18-2.5 is enacted to read:
             100          26-18-2.5. Simplified enrollment and renewal process for Medicaid and other
             101      state medical programs -- Financial institutions.
             102          (1) The department shall:
             103          (a) apply for grants to make technology system improvements necessary to implement
             104      a simplified enrollment and renewal process for the Medicaid program, Utah Premium
             105      Partnership, and Primary Care Network Demonstration Project programs; and
             106          (b) if funding is available, implement the simplified enrollment and renewal process in
             107      accordance with this section.
             108          (2) The simplified enrollment and renewal process established in this section shall, in
             109      accordance with Section 59-1-403 , provide an eligibility worker a process in which the
             110      eligibility worker:
             111          (a) verifies the applicant's or enrollee's identity;
             112          (b) gets consent to obtain the applicant's adjusted gross income from the State Tax
             113      Commission from:
             114          (i) the applicant or enrollee, if the applicant or enrollee filed a single tax return; or
             115          (ii) both parties to a joint return, if the applicant filed a joint tax return; and
             116          (c) obtains from the State Tax Commission, the adjusted gross income of the applicant
             117      or enrollee.
             118          (3) (a) The department may enter into an agreement with a financial institution doing


             119      business in the state to develop and operate a data match system to identify an applicant or
             120      enrollee assets that:
             121          (i) uses automated data exchanges to the maximum extent feasible; and
             122          (ii) requires a financial institution each month to provide the name, record address,
             123      Social Security number, other taxpayer identification number, or other identifying information
             124      for each applicant or enrollee who maintains an account at the financial institution.
             125          (b) The department may pay a reasonable fee to a financial institution for compliance
             126      with this Subsection (3), as provided in Section 7-1-1006 .
             127          (c) A financial institution may not be liable under any federal or state law to any person
             128      for any disclosure of information or action taken in good faith under this Subsection (3).
             129          (d) The department may disclose a financial record obtained from a financial institution
             130      under this section only for the purpose of, and to the extent necessary in, verifying eligibility as
             131      provided in this section and Section 26-40-105 .
             132          Section 3. Section 26-18-2.6 is enacted to read:
             133          26-18-2.6. Dental Benefits.
             134          (1) (a) The division shall establish a competitive bid process to bid out Medicaid dental
             135      benefits under this chapter.
             136          (b) The division may bid out the Medicaid dental benefits separately from other
             137      program benefits.
             138          (2) The division shall use the following criteria to evaluate dental bids:
             139          (a) ability to manage dental expenses;
             140          (b) proven ability to handle dental insurance;
             141          (c) efficiency of claim paying procedures;
             142          (d) provider contracting, discounts, and adequacy of network; and
             143          (e) other criteria established by the department.
             144          (3) The division shall request bids for the program's benefits:
             145          (a) in 2011; and
             146          (b) at least once every five years thereafter.
             147          (4) The division's contract with dental plans for the program's benefits shall include
             148      risk sharing provisions in which the dental plan must accept 100% of the risk for any difference
             149      between the division's premium payments per client and actual dental expenditures.


             150          (5) The division may not award contracts to:
             151          (a) more than three responsive bidders under this section; or
             152          (b) an insurer that does not have a current license in the state.
             153          (6) (a) The division may cancel the request for proposals if:
             154          (i) there are no responsive bidders; or
             155          (ii) the division determines that accepting the bids would increase the program's costs.
             156          (b) If the division cancels the request for proposals under Subsection (6)(a), the
             157      division shall report to the Health and Human Services Committee regarding the reasons for
             158      the decision.
             159          (7) Title 63, Chapter 56, Utah Procurement Code, shall apply to this section.
             160          Section 4. Section 26-40-105 is amended to read:
             161           26-40-105. Eligibility.
             162          (1) A child is eligible to enroll in the program if the child:
             163          (a) is a bona fide Utah resident;
             164          (b) is a citizen or legal resident of the United States;
             165          (c) is under 19 years of age;
             166          (d) does not have access to or coverage under other health insurance, including any
             167      coverage available through a parent or legal guardian's employer;
             168          (e) is ineligible for Medicaid benefits;
             169          (f) resides in a household whose gross family income, as defined by rule, is at or below
             170      200% of the federal poverty level; and
             171          (g) is not an inmate of a public institution or a patient in an institution for mental
             172      diseases.
             173          (2) A child who qualifies for enrollment in the program under Subsection (1) may not
             174      be denied enrollment due to a diagnosis or pre-existing condition.
             175          (3) (a) The department shall determine eligibility and send notification of the eligibility
             176      decision within 30 days after receiving the application for coverage.
             177          (b) If the department cannot reach a decision because the applicant fails to take a
             178      required action, or because there is an administrative or other emergency beyond the
             179      department's control, the department shall:
             180          (i) document the reason for the delay in the applicant's case record; and


             181          (ii) inform the applicant of the status of the application and time frame for completion.
             182          (4) The department may not close enrollment in the program for a child who is eligible
             183      to enroll in the program under the provisions of Subsection (1).
             184          (5) (a) The program shall:
             185          (i) apply for grants to make technology system improvements necessary to implement a
             186      simplified enrollment and renewal process in accordance with this Subsection (5); and
             187          (ii) if funding is available, implement the simplified enrollment and renewal process in
             188      accordance with this Subsection (5).
             189          (b) The simplified enrollment and renewal process:
             190          (i) shall, in accordance with Section 59-1-403 , provide an eligibility worker a process
             191      in which the eligibility worker:
             192          (A) verifies the applicant's identity;
             193          (B) gets consent to obtain the applicant's adjusted gross income from the [Utah] State
             194      Tax Commission from:
             195          (I) the applicant, if the applicant filed a single tax return; or
             196          (II) both parties to a joint return, if the applicant filed a joint tax return; and
             197          (C) obtains from the Utah State Tax Commission, the adjusted gross income of the
             198      applicant; and
             199          (ii) may not change the eligibility requirements for the program.
             200          Section 5. Section 59-1-403 is amended to read:
             201           59-1-403. Confidentiality -- Exceptions -- Penalty -- Application to property tax.
             202          (1) (a) Any of the following may not divulge or make known in any manner any
             203      information gained by that person from any return filed with the commission:
             204          (i) a tax commissioner;
             205          (ii) an agent, clerk, or other officer or employee of the commission; or
             206          (iii) a representative, agent, clerk, or other officer or employee of any county, city, or
             207      town.
             208          (b) An official charged with the custody of a return filed with the commission is not
             209      required to produce the return or evidence of anything contained in the return in any action or
             210      proceeding in any court, except:
             211          (i) in accordance with judicial order;


             212          (ii) on behalf of the commission in any action or proceeding under:
             213          (A) this title; or
             214          (B) other law under which persons are required to file returns with the commission;
             215          (iii) on behalf of the commission in any action or proceeding to which the commission
             216      is a party; or
             217          (iv) on behalf of any party to any action or proceeding under this title if the report or
             218      facts shown by the return are directly involved in the action or proceeding.
             219          (c) Notwithstanding Subsection (1)(b), a court may require the production of, and may
             220      admit in evidence, any portion of a return or of the facts shown by the return, as are specifically
             221      pertinent to the action or proceeding.
             222          (2) This section does not prohibit:
             223          (a) a person or that person's duly authorized representative from receiving a copy of
             224      any return or report filed in connection with that person's own tax;
             225          (b) the publication of statistics as long as the statistics are classified to prevent the
             226      identification of particular reports or returns; and
             227          (c) the inspection by the attorney general or other legal representative of the state of the
             228      report or return of any taxpayer:
             229          (i) who brings action to set aside or review a tax based on the report or return;
             230          (ii) against whom an action or proceeding is contemplated or has been instituted under
             231      this title; or
             232          (iii) against whom the state has an unsatisfied money judgment.
             233          (3) (a) Notwithstanding Subsection (1) and for purposes of administration, the
             234      commission may by rule, made in accordance with Title 63G, Chapter 3, Utah Administrative
             235      Rulemaking Act, provide for a reciprocal exchange of information with:
             236          (i) the United States Internal Revenue Service; or
             237          (ii) the revenue service of any other state.
             238          (b) Notwithstanding Subsection (1) and for all taxes except individual income tax and
             239      corporate franchise tax, the commission may by rule, made in accordance with Title 63G,
             240      Chapter 3, Utah Administrative Rulemaking Act, share information gathered from returns and
             241      other written statements with the federal government, any other state, any of the political
             242      subdivisions of another state, or any political subdivision of this state, except as limited by


             243      Sections 59-12-209 and 59-12-210 , if the political subdivision, other state, or the federal
             244      government grant substantially similar privileges to this state.
             245          (c) Notwithstanding Subsection (1) and for all taxes except individual income tax and
             246      corporate franchise tax, the commission may by rule, in accordance with Title 63G, Chapter 3,
             247      Utah Administrative Rulemaking Act, provide for the issuance of information concerning the
             248      identity and other information of taxpayers who have failed to file tax returns or to pay any tax
             249      due.
             250          (d) Notwithstanding Subsection (1), the commission shall provide to the Solid and
             251      Hazardous Waste Control Board executive secretary, as defined in Section 19-6-102 , as
             252      requested by the executive secretary, any records, returns, or other information filed with the
             253      commission under Chapter 13, Motor and Special Fuel Tax Act, or Section 19-6-410.5
             254      regarding the environmental assurance program participation fee.
             255          (e) Notwithstanding Subsection (1), at the request of any person the commission shall
             256      provide that person sales and purchase volume data reported to the commission on a report,
             257      return, or other information filed with the commission under:
             258          (i) Chapter 13, Part 2, Motor Fuel; or
             259          (ii) Chapter 13, Part 4, Aviation Fuel.
             260          (f) Notwithstanding Subsection (1), upon request from a tobacco product manufacturer,
             261      as defined in Section 59-22-202 , the commission shall report to the manufacturer:
             262          (i) the quantity of cigarettes, as defined in Section 59-22-202 , produced by the
             263      manufacturer and reported to the commission for the previous calendar year under Section
             264      59-14-407 ; and
             265          (ii) the quantity of cigarettes, as defined in Section 59-22-202 , produced by the
             266      manufacturer for which a tax refund was granted during the previous calendar year under
             267      Section 59-14-401 and reported to the commission under Subsection 59-14-401 (1)(a)(v).
             268          (g) Notwithstanding Subsection (1), the commission shall notify manufacturers,
             269      distributors, wholesalers, and retail dealers of a tobacco product manufacturer that is prohibited
             270      from selling cigarettes to consumers within the state under Subsection 59-14-210 (2).
             271          (h) Notwithstanding Subsection (1), the commission may:
             272          (i) provide to the Division of Consumer Protection within the Department of
             273      Commerce and the attorney general data:


             274          (A) reported to the commission under Section 59-14-212 ; or
             275          (B) related to a violation under Section 59-14-211 ; and
             276          (ii) upon request provide to any person data reported to the commission under
             277      Subsections 59-14-212 (1)(a) through (c) and Subsection 59-14-212 (1)(g).
             278          (i) Notwithstanding Subsection (1), the commission shall, at the request of a committee
             279      of the Legislature, Office of the Legislative Fiscal Analyst, or Governor's Office of Planning
             280      and Budget, provide to the committee or office the total amount of revenues collected by the
             281      commission under Chapter 24, Radioactive Waste Facility Tax Act, for the time period
             282      specified by the committee or office.
             283          (j) Notwithstanding Subsection (1), the commission shall make the directory required
             284      by Section 59-14-603 available for public inspection.
             285          (k) Notwithstanding Subsection (1), the commission may share information with
             286      federal, state, or local agencies as provided in Subsection 59-14-606 (3).
             287          (l) (i) Notwithstanding Subsection (1), the commission shall provide the Office of
             288      Recovery Services within the Department of Human Services any relevant information
             289      obtained from a return filed under Chapter 10, Individual Income Tax Act, regarding a taxpayer
             290      who has become obligated to the Office of Recovery Services.
             291          (ii) The information described in Subsection (3)(l)(i) may be provided by the Office of
             292      Recovery Services to any other state's child support collection agency involved in enforcing
             293      that support obligation.
             294          (m) (i) Notwithstanding Subsection (1), upon request from the state court
             295      administrator, the commission shall provide to the state court administrator, the name, address,
             296      telephone number, county of residence, and Social Security number on resident returns filed
             297      under Chapter 10, Individual Income Tax Act.
             298          (ii) The state court administrator may use the information described in Subsection
             299      (3)(m)(i) only as a source list for the master jury list described in Section 78B-1-106 .
             300          (n) Notwithstanding Subsection (1), the commission shall at the request of a
             301      committee, commission, or task force of the Legislature provide to the committee, commission,
             302      or task force of the Legislature any information relating to a tax imposed under Chapter 9,
             303      Taxation of Admitted Insurers, relating to the study required by Section 59-9-101 .
             304          (o) (i) As used in this Subsection (3)(o), "office" means the:


             305          (A) Office of the Legislative Fiscal Analyst; or
             306          (B) Office of Legislative Research and General Counsel.
             307          (ii) Notwithstanding Subsection (1) and except as provided in Subsection (3)(o)(iii),
             308      the commission shall at the request of an office provide to the office all information:
             309          (A) gained by the commission; and
             310          (B) required to be attached to or included in returns filed with the commission.
             311          (iii) (A) An office may not request and the commission may not provide to an office a
             312      person's:
             313          (I) address;
             314          (II) name;
             315          (III) Social Security number; or
             316          (IV) taxpayer identification number.
             317          (B) The commission shall in all instances protect the privacy of a person as required by
             318      Subsection (3)(o)(iii)(A).
             319          (iv) An office may provide information received from the commission in accordance
             320      with this Subsection (3)(o) only:
             321          (A) as:
             322          (I) a fiscal estimate;
             323          (II) fiscal note information; or
             324          (III) statistical information; and
             325          (B) if the information is classified to prevent the identification of a particular return.
             326          (v) (A) A person may not request information from an office under Title 63G, Chapter
             327      2, Government Records Access and Management Act, or this section, if that office received the
             328      information from the commission in accordance with this Subsection (3)(o).
             329          (B) An office may not provide to a person that requests information in accordance with
             330      Subsection (3)(o)(v)(A) any information other than the information the office provides in
             331      accordance with Subsection (3)(o)(iv).
             332          (p) Notwithstanding Subsection (1), the commission may provide to the governing
             333      board of the agreement or a taxing official of another state, the District of Columbia, the United
             334      States, or a territory of the United States:
             335          (i) the following relating to an agreement sales and use tax:


             336          (A) information contained in a return filed with the commission;
             337          (B) information contained in a report filed with the commission;
             338          (C) a schedule related to Subsection (3)(p)(i)(A) or (B); or
             339          (D) a document filed with the commission; or
             340          (ii) a report of an audit or investigation made with respect to an agreement sales and
             341      use tax.
             342          (q) Notwithstanding Subsection (1), the commission may provide information
             343      concerning a taxpayer's state income tax return or state income tax withholding information to
             344      the Driver License Division if the Driver License Division:
             345          (i) requests the information; and
             346          (ii) provides the commission with a signed release form from the taxpayer allowing the
             347      Driver License Division access to the information.
             348          (r) Notwithstanding Subsection (1), the commission shall provide to the Utah State 911
             349      Committee the information requested by the Utah State 911 Committee under Subsection
             350      53-10-602 (3).
             351          (s) Notwithstanding Subsection (1), the commission may provide to the Utah
             352      Educational Savings Plan information related to a resident or nonresident individual's
             353      contribution to a Utah Educational Savings Plan account as designated on the resident or
             354      nonresident's individual income tax return under Section 59-10-1313 .
             355          (t) Notwithstanding Subsection (1), for the purpose of verifying eligibility under
             356      Sections 26-18-2.5 and 26-40-105 , the commission shall provide an eligibility worker with the
             357      [Children's Health Insurance Program] Department of Health or its designee with the adjusted
             358      gross income of an individual if:
             359          (i) an eligibility worker with the [Children's Health Insurance Program] Department of
             360      Health or its designee requests the information from the [Utah] State Tax Commission; and
             361          (ii) the eligibility worker has complied with the identity verification and consent
             362      provisions of [Section] Sections 26-18-2.5 and 26-40-105 .
             363          (4) (a) [Reports] Each report and [returns] return shall be preserved for at least three
             364      years.
             365          (b) After the three-year period provided in Subsection (4)(a) the commission may
             366      destroy a report or return.


             367          (5) (a) Any person who violates this section is guilty of a class A misdemeanor.
             368          (b) If the person described in Subsection (5)(a) is an officer or employee of the state,
             369      the person shall be dismissed from office and be disqualified from holding public office in this
             370      state for a period of five years thereafter.
             371          (c) Notwithstanding Subsection (5)(a) or (b), an office that requests information in
             372      accordance with Subsection (3)(o)(iii) or a person that requests information in accordance with
             373      Subsection (3)(o)(v):
             374          (i) is not guilty of a class A misdemeanor; and
             375          (ii) is not subject to:
             376          (A) dismissal from office in accordance with Subsection (5)(b); or
             377          (B) disqualification from holding public office in accordance with Subsection (5)(b).
             378          (6) Except as provided in Section 59-1-404 , this part does not apply to the property tax.
             379          Section 6. Effective date.
             380          This bill takes effect on July 1, 2012.


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