Title of Regulation: 12VAC5-408. Certificate of Quality Assurance of Managed Care Health Insurance Plan Licensees (amending 12VAC5-408-10, 12VAC5-408-170).

Statutory Authority: §§ 32.1-12 and 32.1-137.3 of the Code of Virginia.

Public Hearing Information: No public hearings are currently scheduled.

Public Comment Deadline: March 31, 2021.

Effective Date: April 15, 2021.

Agency Contact: Rebekah E. Allen, Senior Policy Analyst, Virginia Department of Health, 9960 Mayland Drive, Suite 401, Richmond, VA 23233, telephone (804) 367-2102, FAX (804) 527-4502, or email regulatorycomment@vdh.virginia.gov.

Basis: This regulation is promulgated under the authority of §§ 32.1-12 and 32.1-137.3 of the Code of Virginia. Section 32.1-12 grants the State Board of Health the legal authority to make, adopt, promulgate, and enforce such regulations as may be necessary to carry out the provisions of Title 32.1 of the Code of Virginia. Section 32.1-137.3 directs the Department of Health (VDH) to promulgate regulations governing the quality of care provided to covered persons by a managed care health insurance plan licensee.

Purpose: Chapter 703 of the 2018 Acts of Assembly adds § 38.2-3407.10:1 to the Code of Virginia, creating the statutory requirements for reimbursement for services rendered during pendency of a physician's credentialing application, as described in this action. VDH is subject to the legislative mandate to promulgate regulations consistent with the act. Managed Care Health Insurance Plan (MCHIP) licensees employ or otherwise contract with and credential providers other than physicians. As such, and under the authority of § 32.1-137.2 of the Code of Virginia, the provisions regarding reimbursement were expanded to include other credentialed providers in addition to physicians. The change will update a portion of the credentialing process to conform to the statute and will allow new provider applicants to begin seeing covered persons.

The regulatory action is necessary to protect public health, safety, or welfare because requiring MCHIP licensees to reimburse newly credentialied providers at in-network rates for health care services provided to covered persons during the period in which the new provider applicant's completed credentialing application was pending encourages provider applicants to accept patients who otherwise would have less choice in health care providers.

Rationale for Using Fast-Track Rulemaking Process: Chapter 703 of the 2018 Acts of Assembly requires VDH to revise and reenact the regulations promulgated pursuant to § 32.1-137.1 of the Code of Virginia. As this action is being used to conform to the intent of a statutory mandate, VDH believes the proposed regulatory action will be noncontroversial, allowing use of the fast-track rulemaking process.

Substance: The definitions of "health care provider" or "provider," "managed care plan," "new provider applicant," and "participating provider" are added. Provisions are repealed that required the entire credentialing process to be completed before a provider could begin seeing covered persons or enter into a contractual relationship with the MCHIP licensee and text conforming to § 38.2-3407.10:1 are added.

Issues: The primary advantages are to (i) providers applying for credentialing by an MCHIP licensee that may render services to covered persons and seek reimbursement for that care and (ii) MCHIP-covered persons who will be able to be treated by those providers earlier in the credentialing process. The Code of Virginia and regulatory change protect patients from having to pay for services rendered by a new provider applicant if the applicant is subsequently not approved to be credentialed as part of the MCHIP's network of participating providers. As covered persons of an MCHIP will have expanded access to providers, the advantage to VDH for promulgating this regulatory change is the promotion of the public's access to health care. There are no known disadvantages to the public or the Commonwealth.

Department of Planning and Budget's Economic Impact Analysis:

Summary of the Proposed Amendments to Regulation. The Board of Health (Board) proposes to allow physicians and non-physician health care providers to provide their services while their application for credentialing to a managed care health insurance plan licensee (MCHIP) is pending. After a provider has been credentialed (otherwise known as being in network), the Board also proposes to permit retroactive provider reimbursement for services rendered, starting on the date the providers credentialing application was received by the MCHIP.

Background. In the past, health care providers were not allowed to be reimbursed for services provided to covered patients during the period in which their application for credentialing was being reviewed by the MCHIP (the pendency period). Chapter 703 of the 2018 Acts of Assembly¹ amended the Code of Virginia by adding § 38.2-3407.10:1 to allow physicians to receive reimbursement, at the contracted in-network rates, for covered persons seen during the pendency. This reimbursement would be made after the application had been approved by the MCHIP. At the present time, such physician practice is allowed under the authority of the 2018 legislation.

Additionally, the Board is exercising its authority under § 32.1-137.2(C) of the Code of Virginia to also allow non-physician health care providers to be reimbursed for services they provided during the pendency of the credentialing process and upon approval of their credentialing application, to receive reimbursement at the contracted in-network rates for covered persons seen during the pendency. This regulation would allow such non-physician health care provider practice in a similar fashion to that of physician providers. According to the Virginia Department of Health (VDH), the non-physician health care providers may include any of the professions regulated by the Department of Health Professions except the professions regulated by the Board of Pharmacy.

Credentialing is already required and is a part of an incentive arrangement intended to influence the cost or level of health care services between the MCHIP and one or more health care providers with respect to the delivery of health care services, and must also include minimum standards of professional licensure or certification. During the credentialing process, the MCHIP verifies the validity and history of the applicant's professional license or certification, status of hospital privileges, education and training, and practice or work history among other things, to ensure that physicians meet the MCHIPs standards. The credentialing process is required to be completed within 120 days or within 150 days if the application is incomplete or requires additional information.

According to VDH, once a health care provider is credentialed, they would enter into a contract with the MCHIP that not only addresses reimbursement for services, but also requires the provider to take part in the MCHIPs quality assurance program that monitors quality of care and performance metrics of providers.

Credentialing benefits the MCHIPs in that it enables them to ensure that providers have the minimum professional competence to render high quality care. It also allows them to take into account any disciplinary issues related to professional licensure and any previous quality of care issues.

Credentialing also benefits the providers because being credentialed (that is, being deemed to be in-network) allows them to access a patient population that may otherwise have chosen a different provider with more preferential cost-sharing arrangements. As a part of being in network, a health care provider agrees to charge specific rates for services, which is often lower than the market/out-of-pocket rate; however, they are guaranteed to receive this rate along with a greater access to MCHIP covered patients. A non-credentialed provider (i.e., one who is out-of-network) can submit a claim for reimbursement by the MCHIP, but will be reimbursed at a less preferential rate. The remaining balance is billed to the patient; however, the health care provider is not guaranteed to collect the outstanding balance. Hence, unless a patient's preference for that specific provider outweighs financial considerations, an out-of-network provider will typically not have access to the patient population covered by a particular MCHIP.

Estimated Benefits and Costs. The 2018 legislation provided an option to physicians to start providing their services and receive reimbursement from their MCHIP the in-network rate during the pendency of their application subject to certain conditions. To receive the in-network reimbursement, the legislation requires the applicant physician to provide a written or electronic notification to the patient in advance of treatment, stating that the carrier is in the process of obtaining and verifying credentialing information. The legislation also allows MCHIPs to reimburse physicians at the in-network rates only if the physician is eventually credentialed. In the event that credentialing is denied, the MCHIP would not be required to remit the in-network rate and the patient would not be responsible for any of the charges for the service other than the in-network coinsurance, copayment, or the deductible. The Board proposes the same rules for the non-physician health care providers.

Under the new rules, a health care provider would have the option to start providing services in an MCHIPs network as soon as their completed application has been received. In doing so, the provider can start building a volume of receivables from the MCHIP, but is also taking a risk of forgoing in-network reimbursement rates if the credentialing is denied. However, we can reliably infer that in providing services, the provider reveals that the expected benefits to him are greater than the potential loss of in-network reimbursement rates.² On the other hand, the MCHIP has to evaluate the application once it is submitted, but this requirement is not new and has existed before. In addition, the MCHIP would not be required to remit the in-network rate to the provider if the credentialing is eventually denied. Thus, the MCHIPs do not appear to be worse off either.

The proposed rules also do not appear to make the patients any worse off. First, any provider applicant would have to have a license to practice their profession and it appears that an MCHIP may require higher standards than the license requires, but not lower. Second, the provider applicant would be required to provide disclosures to the patients in advance of any treatment that their credentials are currently being evaluated. Third, in the event credentialing is denied, the patient would only be responsible for paying the in-network coinsurance, copayments, or deductibles, not the out-of-network charges, which are typically higher, for the services provided by that health care provider.

In summary, the health care provider and the patient would both need to consent for provision of services during the credentialing process, and the MCHIPs do not appear to be any worse off. Further, the proposed rules are beneficial in that they allow the health care providers to start providing their services sooner. Such a practice may expedite the provision of services by new MCHIP providers and improve access to care.

Businesses and Other Entities Affected. There are approximately 96 MCHIPs. According to VDH, these plans contract with approximately 90 percent of the regulated health care providers. However, there is no data on the number of credentialing applications received by MCHIPs in a given time period. Also, some patients may be affected to the extent they consent to receive services from a provider whose credentialing application is pending.

Localities³ Affected.⁴ The proposed amendments are unlikely to affect any locality more than others. The proposed amendments do not appear to impose costs on localities.

Projected Impact on Employment. The proposed amendments would allow the health care providers to start providing services 120 days to 150 days earlier than otherwise would be, which would add to the supply of medical and dental services.

Effects on the Use and Value of Private Property. The proposed amendments would allow a health care provider to start building its receivables while the credentialing process is underway and may add to the asset value of the providers business.

Real estate development costs do not appear to be affected.

Adverse Effect on Small Businesses.⁵ The proposed amendments do not appear to adversely affect small businesses.

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¹http://lis.virginia.gov/cgi-bin/legp604.exe?181 ful CHAP0703

²Prior to the 2018 legislation, in 2016, the Medical Society of Virginia submitted a petition for rulemaking requesting substantially the same changes on behalf of their nearly 11,000 members including physicians, medical students and physician assistants to address the issues with significant delays in delivering care to patients as a result of the credentialing process. See https://townhall.virginia.gov/l/viewpetition.cfm?petitionid=236.

³Locality can refer to either local governments or the locations in the Commonwealth where the activities relevant to the regulatory change are most likely to occur.

⁴§ 2.2-4007.04 defines particularly affected" as bearing disproportionate material impact.

⁵Pursuant to § 2.2-4007.04 of the Code of Virginia, small business is defined as a business entity, including its affiliates, that (i) is independently owned and operated and (ii) employs fewer than 500 full-time employees or has gross annual sales of less than $6 million.

Agency's Response to Economic Impact Analysis: The Virginia Department of Health has reviewed and concurs with the Department of Planning and Budget's economic impact analysis.

Summary:

Pursuant to Chapter 703 of the 2018 Acts of Assembly, the amendments conform the regulation to § 38.2-3407.10:1 of the Code of Virginia, which requires health insurance carriers that credential physicians in their networks to establish protocols and procedures for reimbursing new provider applicants for health care services provided to covered persons during the period in which the applicant's completed credentialing application is pending, provided that the new provider applicant is ultimately approved by the health insurance carrier. Amendments also extend the protocols and procedures to cover nonphysician providers, allowing them to submit claims to the carrier for services provided during that time period. Carriers are not required to reimburse the new provider applicant for any care rendered if the credentialing application is not approved or the carrier is otherwise unwilling to contract with the new provider applicant. If payment is made by the carrier to a new provider applicant or any entity that employs or engages the new provider applicant for a covered service, the patient is only responsible for any copayment, coinsurance, or deductibles permitted under the insurance contract with the carrier or participating provider agreement with the new provider applicant.

12VAC5-408-10. Definitions.

The following words and terms when used in this chapter shall have the following meanings unless the context clearly indicates otherwise:

"Adverse decision" means a utilization review determination by the utilization review entity that a health service rendered or proposed to be rendered was not or is not medically necessary, when such determination may result in noncoverage of the health service or health services. When the policy, contract, plan, certificate, or evidence of coverage includes coverage for prescription drugs and the health service rendered or proposed to be rendered is a prescription for the alleviation of cancer pain, any adverse decision shall be made within 24 hours of the request for coverage.

"Appeal" means a formal request by a covered person or a provider on behalf of a covered person for reconsideration of a decision, such as a final adverse decision, a benefit payment, a denial of coverage, or a reimbursement for service.

"Basic health care services" means those health care services, as applicable to the type of managed care health insurance plan, described in § 38.2-5800 of the Code of Virginia which are required to be provided, arranged, paid for, or reimbursed by the managed care health insurance plan licensee for its covered persons.

"Board" means the Board of Health.

"Bureau of Insurance" means the State Corporation Commission acting pursuant to Title 38.2 of the Code of Virginia.

"Center" means the Center for Quality Health Care Services and Consumer Protection of the Virginia Department of Health.

"Certificate" means a certificate of quality assurance.

"Complaint" means a written communication from a covered person primarily expressing a grievance. A complaint may pertain to the availability, delivery, or quality of health care services including claims payments, the handling or reimbursement for such services, or any other matter pertaining to the covered person's contractual relationship with the MCHIP.

"Covered person" means an individual residing in the Commonwealth, whether a subscriber, policyholder, enrollee, or member, of a managed care health insurance plan (MCHIP), who is entitled to health services or benefits provided, arranged for, paid for, or reimbursed pursuant to an MCHIP.

"Delegated service entity" means the entity with which an MCHIP licensee contracts to provide one or more of the services listed in 12VAC5-408-320 A for one or more of its MCHIPs, pursuant to and in accordance with the provisions of Part VI (12VAC5-408-320 et seq.) of this chapter, inclusive.

"Department" means the Virginia Department of Health.

"Emergency services" means those health care services as defined in § 38.2-3438 of the Code of Virginia.

"Evidence of coverage" means any certificate, individual or group agreement or contract, or identification card or related document issued in conjunction with the certificate, agreement or contract, issued to a covered person setting out the coverage and other rights to which a covered person is entitled.

"Final adverse decision" means a utilization review determination made by a physician advisor or peer of the treating health care provider in a reconsideration of an adverse decision, and upon which a provider or patient may base an appeal.

"Health care data reporting system" means the state contracted integrated system for the collection and analysis of data used by consumers, employers, providers, and purchasers of health care to continuously assess and improve the quality of health care in the Commonwealth.

"Health care provider" or "provider" has the same meaning ascribed to the term in § 32.1-127.1:03 B of the Code of Virginia.

"Health care services" means services as defined in § 38.2-3438 of the Code of Virginia.

"Health carrier" means an entity as defined in § 38.2-3438 of the Code of Virginia.

"Managed care health insurance plan" or "MCHIP" means an arrangement for the delivery of health care in which a health carrier, as defined in § 38.2-5800 of the Code of Virginia, undertakes to provide, arrange for, pay for, or reimburse any of the costs of health care services for a covered person on a prepaid or insured basis which (i) contains one or more incentive arrangements, including any credentialing requirements intended to influence the cost or level of health care services between the health carrier and one or more providers with respect to the delivery of health care services and (ii) requires or creates benefit payment differential incentives for covered persons to use providers that are directly or indirectly managed, owned, under contract with or employed by the health carrier. Any health maintenance organization as defined in § 38.2-4300 of the Code of Virginia or health carrier that offers preferred provider contracts or policies as defined in § 38.2-3407 of the Code of Virginia or preferred provider subscription contracts as defined in § 38.2-4209 of the Code of Virginia shall be deemed to be offering one or more managed care health insurance plans. For the purposes of this definition, the prohibition of balance billing by a provider shall not be deemed a benefit payment differential incentive for covered persons to use providers who are directly or indirectly managed, owned, under contract with or employed by the health carrier. A single managed care health insurance plan may encompass multiple products and multiple types of benefit payment differentials; however, a single managed care health insurance plan shall encompass only one provider network or set of provider networks.

"Managed care health insurance plan licensee" or "MCHIP licensee" means a health carrier subject to licensure by the Bureau of Insurance and to quality assurance certification by the department under Title 38.2 of the Code of Virginia who is responsible for a managed care health insurance plan in accordance with Chapter 58 (§ 38.2-5800 et seq.) of Title 38.2 of the Code of Virginia.

"Managed care plan" means a health benefit plan, as defined in § 38.2-3407.10:1 of the Code of Virginia, that requires a covered person to use, or creates incentives, including financial incentives, for a covered person to use health care providers managed, owned, under contract with, or employed by the MCHIP licensee.

"Material" means that which has an effective influence or bearing on, or is pertinent to, the issue in question.

"Medical necessity" or "medically necessary" means appropriate and necessary health care services which are rendered for any condition which, according to generally accepted principles of good medical practice, requires the diagnosis or direct care and treatment of an illness, injury, or pregnancy-related condition, and are not provided only as a convenience.

"Nationally recognized accrediting body" means an organization that sets national standards specifically governing healthcare quality assurance processes, utilization review, provider credentialing, as well as other areas covered by this chapter and provides accreditation to managed care health insurance plans pursuant to national standards. The following entities shall be considered nationally recognized accrediting bodies:

1. The American Accreditation HealthCare Commission/URAC;

2. The National Committee for Quality Assurance (NCQA);

3. The Joint Commission on Accreditation of Healthcare Organizations, (JCAHO); and

4. Other nationally recognized accrediting bodies with national standards as described above that are accepted by the department.

"Network" means a group of providers as defined in § 38.2-3438 of the Code of Virginia.

"New provider applicant" means a provider that has submitted a completed credentialing application to an MCHIP licensee.

"Participating provider" means a provider that is managed, under contract with, or employed by an MCHIP licensee and who has agreed to provide health care services to covered persons with an expectation of receiving payments, other than coinsurance, copayments, or deductibles, directly or indirectly from the MCHIP licensee.

"Person" means any individual, aggregate of individuals, association, business, company, corporation, joint-stock company, Lloyds type of organization, other organization, partnership, receiver, reciprocal or inter-insurance exchange, trustee or society.

"Plan of correction" means an MCHIP'S written plan that outlines the action the MCHIP will take to address compliance issues identified during an administrative review or on-site examination conducted by the department.

"Preferred provider organization" or "PPO" means an arrangement in which a health carrier, as defined in § 38.2-5800 of the Code of Virginia, undertakes to provide, arrange for, pay for, or reimburse any of the costs of health care services, on an insured basis, which creates incentives, including financial incentives, for a covered person to use health care providers directly or indirectly managed, owned, under contract with, or employed by the health carrier, but shall not include a health maintenance organization as defined in § 38.2-4300 of the Code of Virginia.

"Quality assurance program" means the systems, standards and processes including, but not limited to, reasonable and adequate systems to assess, measure, and improve the health status of covered persons, necessary to obtain a certificate of quality assurance from the department in accordance with this chapter and in accordance with § 32.1-137.2 C of the Code of Virginia.

"Service area" means a geographic area as defined in § 38.2-5800 of the Code of Virginia.

"Timely" means the provision of services so as not to impair or jeopardize the integrity of the covered persons' diagnosis or outcomes of illness.

"Treating health care provider" means a licensed health care provider who renders or proposes to render health care services to a covered person.

"Utilization review" means a system for reviewing the necessity, appropriateness, and efficiency of hospital, medical or other health care services rendered or proposed to be rendered to a patient or group of patients for the purpose of determining whether such services should be covered or provided by an insurer, health services plan, managed care health insurance plan licensee, or other entity or person. For purposes of this chapter, "utilization review" shall include, but not be limited to, preadmission, concurrent and retrospective medical necessity determination, and review related to the appropriateness of the site at which services were or are to be delivered. "Utilization review" shall not include (i) review of issues concerning insurance contract coverage or contractual restrictions on facilities to be used for the provision of services, (ii) any review of patient information by an employee of or consultant to any licensed hospital for patients of such hospital, or (iii) any determination by an insurer as to the reasonableness and necessity of services for the treatment and care of an injury suffered by an insured for which reimbursement is claimed under a contract of insurance covering any classes of insurance defined in §§ 38.2-117 through 38.2-119, 38.2-124 through 38.2-126, 38.2-130 through 38.2-132 and 38.2-134 of the Code of Virginia.

"Utilization review entity" means a person or entity performing utilization review.

"Utilization review plan" means a written procedure for performing a utilization review.

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. The department may impose administrative sanctions upon an MCHIP licensee for failure to complete the credentialing process as provided herein if it 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, 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 appropriate credentialing process shall be completed before the provider:

1. Begins seeing covered persons;

2. Enters into the employment or contractual relationship with the MCHIP licensee; and

3. Is included in the listing of health care providers as a participating provider in any marketing and covered person materials.

G. 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.

H. 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.

I. H. Providers shall be required by the MCHIP licensee to notify the MCHIP of any changes in the status of any credentialing criteria.

J. 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.

K. 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 an 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.

L. 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 them as prescribed in the contract between the MCHIP or its delegated service entity and the provider.

M. 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.

N. 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.

O. 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 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 new provider applicant's completed credentialing application was pending. At a minimum, the protocols and procedures shall:

1. Apply only if the new provider applicant's credentialing application is approved by the MCHIP licensee;

2. Permit provider reimbursement for services rendered from the date the new provider applicant's completed credentialing application is received for consideration by the MCHIP licensee;

3. 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

4. Require that any reimbursement 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.