Compliance With Applicable Laws Regulations Guidelines and ...

Title: : SCFHP Compliance with Applicable Laws,
Regulations, Guidelines and Regulatory Agency
Instructions
Previous Title (if applicable): None
Policy No.: CP015 _01
Supersedes Previous Policy No. (if applicable):
LC06‐01
Department Applicability: Compliance Policy Review Frequency: Annual/Semi‐Annually
Lines of Business: All Date Originated: April 1, 2006
Originating Dept.: Compliance
Originating Dept. Approval: [SIGNATURE ON
FILE]
Date: 4/1/11
Dept. Approval: [COO SIGNATURE ON FILE]
Date: 4/1/11
Chief Medical Officer/Medical Director
Approval:
Date:
Date Approved by P&P Committee:
Revision Date(s): 4/1/11
CEO Approval:
Date:
1. Policy Statement
It is the policy of Santa Clara Family Health Plan (SCFHP), its contractors and
subcontractors to comply with all applicable laws, regulations, guidelines,
regulatory agency instructions, government contract terms and other Applicable
Requirements.
2. Purpose
The purpose of this policy is to make known SCFHPʹs policy about and its
commitment to, compliance with applicable laws, regulations, guidelines,
regulatory agency instructions and other Applicable Requirements.
3. Definitions
A. ʺAgreementʺ, for purposes of this policy, agreement means a contract
entered in to by SCFHP and a provider of health care services to which
SCFHP agrees to arrange for provision of health care services to enrolled
members.
B. ʺApplicable Requirementsʺ include but are not necessarily limited to, the
following, to the extent applicable: (a) the policies and procedures of
SCFHP, which have been developed to guide staff in compliance with the
law governing each subject matter addressed in the policy; (b) federal, state
Authority Cites: 42CFR§§422.504(i)(4)v, 422.504(h)(I, DHCS Contract, and the cites specified in Exhibit 1.
1

and local law and regulations (including, but not limited to, Medicare laws,
regulations, guidelines and CMS instructions; Medi‐Cal laws, regulations,
Authority Cites: 42CFR§§422.504(i)(4)v, 422.504(h)(I, DHCS Contract, and the cites specified in Exhibit 1.
2

MMCD Letters and other guidelines; the laws governing the Healthy
Families Program and MRMIB rules; the Knox‐Keene Act; and laws
governing the use of federal funds, such as the fraud and abuse prevention
and detection laws); (c) the applicable government contract between SCFHP
and a government agency (such as SCFHPʹs contracts with DHCS for Medi‐
Cal Managed Care and any contract it may enter into with CMS for
Medicare); and (d) the terms of SCFHPʹs Evidences of Coverage for the
various product lines.
C. ʺCompliance Planʺ means the SCFHP Compliance Plan, which describes the
health planʹs overall approach to and means of promoting compliance with
Applicable Requirements.
D. ʺContractorʺ means a provider of health care services who has a contract
with SCFHP.
E. ʺDHCSʺ or the ʺDepartment of Health Care Servicesʺ means the California
agency responsible for the administration of the Medi‐Cal program, which
provides medical assistance for the needy.
F. ʺDMHCʺ or the ʺDepartment of Managed Health Careʺ means the California
agency that licenses health care service plans, including Santa Clara Family
Health Plan.
G. ʺLaws and Regulations Governing Contracts and Subcontractsʺ means those
federal and state laws and regulations that require the health plan to include
in its contracts with providers and in some cases administrative service
organizations, certain provisions, and to ensure that the Planʹs subcontractors
include the same or substantially the same language in their subcontracts.
These laws include, but are not necessarily limited to, the laws described in
Exhibit 1 of this policy.
H. ʺLaws and Regulations Governing the Use of Federal Fundsʺ means the
federal laws applicable to persons or entities that are paid with funds that are
in whole or in part federal funds. These laws include, but are not necessarily
limited to, the laws listed in Exhibit 1 of this policy.
I. ʺSubcontractʺ means a contract entered into by someone with whom SCFHP
has a contract, to enable a third party to perform a duty that SCFHPʹs
contractor would have otherwise performed. (For example, if SCFHP
contracts with a medical group to provide health care services to SCFHP
members, the contracts between that medical group and its physicians would
be ʺsubcontractsʺ of the contract between SCFHP and the medical group.)
3

4. Procedures
A. Each Department, with the advice of the compliance department, is
responsible for ensuring that the policies and procedures that it develops
conform to applicable law, regulations, guidelines and regulatory agency
instructions.
B. The head of each Department, with the advice of the compliance department,
is responsible for training its staff on the Applicable Requirements and the
policies designed to achieve compliance with those requirements.
C. The Human Resources Department is responsible for verifying, before
employment and periodically after employment, that SCFHP does not
employ, contract with or retain an existing employment or contractual
relationship with any employee or consultant who is excluded from
participation in any federal program, including but not limited to exclusion
under Section 1128 or 1128A of the Social Security Act. To verify the
personʹs status, the Human Resources Department shall log onto the OIG
(http://exclusions.oig.hhs.gov/search.aspx) and GAO
(http://epls.arnet.gov/epls/servlet/EPLSSearchMain/1) Excluded Persons Data
Bases, and search the name of the candidate or employee.). If the name
appears, SCFHP cannot employ or contract with the candidate, or if already
employed or contracted, SCFHP may be required to terminate the working
relationship. The Human Resources Department shall contact the SCFHPʹs
outside labor counsel for advice before taking any action.
D. As part of the Credentialing and Re‐credentialing function, the Medical
Department is responsible for verifying that none of the providers with
whom SCFHP proposes to contract or does contract have been excluded
from participation in any federal program, including but not limited to
exclusion under Section 1128 or 1128A of the Social Security Act. To verify
the personʹs status, the Medical Department shall log onto the OIG
(http://exclusions.oig.hhs.gov/search.aspx) and GAO
(http://epls.arnet.gov/epls/servlet/EPLSSearchMain/1) Excluded Persons Data
Bases, and search the name of the provider(s). If the name appears, SCFHP
cannot contract with the provider, or if already contracted, SCFHP may be
required to terminate the Agreement. The Medical Department shall contact
the General Counsel of SCFHP for advice before taking any action.
E. The Provider Contracts Department with the advice of the legal and
compliance department, is responsible for ensuring that new provider
4

contractors enter into contracts with SCFHP that contain all provisions
required by Laws and Regulations Governing Contracts and Subcontracts.
Each contract and Subcontract shall require compliance with Applicable
Requirements. Each contractor is given a copy of the SCFHP Provider
Manual, which includes information on Applicable Requirements.
F. The Compliance Department distributes copies of the Code of Conduct and
Compliance Plan, and any amendments to it, to each employee and is
available to answer questions the staff may have.
G. The Legal and Compliance Department, with the help of the other
Departments as needed, is responsible for monitoring compliance with
Applicable Requirements of the Plan, providers and key administrative
service contractors, such as the Planʹs pharmacy benefit manager. At least
once every three years, the Compliance and Internal Auditor audits the
internal departments of SCFHP. At least once every year, the Compliance
and Internal Auditor, with the assistance of other departments, as needed,
audits SCFHPʹs contracting provider groups and hospitals, to verify
compliance with Applicable Requirements in the performance of delegated
duties.
H. The Senior Staff and other designated staff serve as the Compliance
Committee and have the powers and responsibility described in the
Compliance Plan.
I. The Compliance and Internal Auditor, with the advice of other affected
departments determine if corrective action is required by any internal
department or by any contractor; approve or disapprove proposed corrective
action plans; and monitor to determine that corrective action has been taken
and has had the desired effect. If corrective action has not been taken, the
Compliance and Internal Auditor report the noncompliance to the Chief
Executive Officer for further action.
5. Confidentiality of Information
In accordance with SCFHP’s Confidentiality Policy, and all applicable state and
federal laws, any and all information that is required to be kept confidential, is kept
confidential.
5

6. Record Keeping
Each department is responsible for retaining and maintaining
documents/records/paperwork for a minimum of ten (10) years for their own
department (refer to policy LC‐07‐04 Record Retention).
6

EXHIBIT 1
PROVISIONS REQUIRED BY KNOX KEENE ACT OR REGULATIONS (Except as
otherwise noted, all citations in the matrix below are found in the California Health and
Safety Code for statutory sections and in the Code of California Regulations (CCR) at Title
28. Statutory provisions are numbered, for example 1345 or 1371. Regulations are
numbered, for example, 1300.45 or 1300.71.)
KNOX KEENE ACT AND REGULATIONS APPLICABLE TO UNLESS
PREEMPTED BY FEDERAL LAW
Statutory/Reg. § Description of Requirement
H&S §§ 1379 & Written Provider Contracts. Every contract between a Plan and a
1367
provider of health care services must be in writing. All contracts
must be fair, reasonable and consistent with the objectives of the
chapter. The obligation of the plan to comply with the standards
summarized in §1367 and DMHC regulations shall not be waived
when the plan delegates any services that it is required to perform to
its medical groups, independent practice associations, or other
contracting entities.
H&S § 1379 Enrollee Not Liable. Every contract between a Plan and a provider
of health care services must state that in the event that the Plan fails
to pay for health care services as set forth in the subscriber contract,
the enrollee will not be liable to the provider for any sums owed by
the Plan.
H&S § 1379 Deemer Clause. If the contract has not been reduced to writing of
fails to contain the required prohibition, the contracting provider
must not collect or attempt to collect from the enrollee the sums
owed by the Plan.
H&S § 1379 No Action at Law or Equity. No contracting provider, or an agent,
trustee or assignee thereof, may bring any action at law against a
subscriber or enrollee to collect sums owed by the Plan.
7

KNOX KEENE ACT AND REGULATIONS APPLICABLE TO UNLESS
PREEMPTED BY FEDERAL LAW
Statutory/Reg. § Description of Requirement
H&S §§ 1379, Surcharges Prohibited. Each Plan contract shall prohibit surcharges
1385; 28 CCR and require all providers who contract with the Plan to report to the
§1300.67.8 Plan in writing all surcharges and co‐payment moneys paid by
enrollees directly to such providers, unless the Director expressly
approves otherwise.
H&S §1394.7(e). Continuation of Care in the Event of Receivership and in Other
Specified Cases. Contracting providers shall continue to provide
services to enrollees of an insolvent Plan. The continuation of care
period shall last until the effective date of an enrollee’s coverage in a
successor Plan or such other time period agreed upon by the parties.
H&S §1373.96(e) Continuity of Care in the Event of Provider Termination.
Terminating or terminated provider shall also assure continuity of
care to enrollee, at enrollee or Plan request, in acute care, or with a
serious chronic condition or who is pregnant can obtain
continuation of care from terminated providers for a reasonable
transition period (at least 90 days).
H&S §1348(a) Antifraud Plan. Each Plan must establish an antifraud plan. The
purpose of the antifraud plan is to reduce costs to the Plans,
providers, enrollees and others caused by fraudulent activities and
to protect consumers by timely detection, investigation and
prosecution of suspected fraud.
28 CCR 1300.51
(k)
H&S § 1367(d)
28 CCR §
1300.67.1
Grievance system compliance. The Plan must ensure that its
grievance system is capable of resolving grievances. Provider agrees
to comply with the decision of the grievance committee.
Record Keeping and Access to Records. To enable Plan to meet its
statutory obligation, Subcontractor shall furnish services in a manner
providing continuity of care and ready referral of patients to other
providers at times as may be appropriate, consistent with good
professional practice, including but not limited to by ensuring access
by providers to member records.
Administrative & Systems Adequacy. To promote continuity of care,
Provider shall provide for:
o The maintenance and ready availability of medical records
with sharing within the Plan of all pertinent information relating to
the health care of the enrollee. 1300.67.1(c).
8

KNOX KEENE ACT AND REGULATIONS UNLESS PREEMPTED BY FEDERAL
LAW
Statutory/Reg. § Description of Requirement
28 CCR
o The maintenance of staff including health professionals,
1300.67.1(d) & administrative and other support staff, directly or through an
(e).
adequate referral system, sufficient to ensure that health care
(cont.)
services will be provided on a timely and appropriate basis to
enrollees. 1300.67.1(d).
o An adequate system of documenting referrals to physicians or
other health professionals. The monitoring of the follow up of
enrolleesʹ health care documentation shall be the responsibility
of the health care service plan and associated health
professionals. 1300.67.1(e)
H&S § 1364.5(c) Disclosure. Any disclosure of medical information beyond the
provisions of the law is prohibited.
H&S §
1386(b)(15)
H&S § 1367(e)
28 CCR
§1300.70(b)(1)
H&S
§1375.1(a)(3).
H&S §1365.5
Confidentiality. The grounds for disciplinary action by the Director
include any violation by a Plan of the Confidentiality of Medical
Information Act (Civil Code Section 56 et seq.).
Availability and Accessibility; Standard of Care. All services must
be readily available at reasonable times and, to the extent feasible,
readily accessible to all members consistent with good professional
practice and applicable regulations. Telemedicine services that are
appropriately provided may be used to meet the requirement that
services be available and accessible.
Standard of Care. The Plan must assure that a level of care that
meets professionally recognized standards of practice is being
delivered to all enrollees. Subcontractors shall meet that standard of
care and cooperate with SCFHP’s oversight efforts.
Prompt Payment. A procedure for prompt payment or denial of
provider and enrollee claims, including but not limited to claims for
telemedicine services. Contract must address timing of payment
and interest on late payments.
No Discrimination. Discrimination is prohibited on the basis of age,
race, color, creed, religion, sex, sexual pref., national origin, health
status, genetic characteristics, physical and/or mental disability, or
because in a prepaid health plan.
9

KNOX KEENE ACT AND REGULATIONS UNLESS PREEMPTED BY FEDERAL
LAW
Statutory/Reg. § Description of Requirement
H&S §1352, 28 Contracts and other Changes Must Be Filed and Approved by
CCR 1300.67.1 et DMHC. W Prior to an amendment or material modification of its
seq.
plan or operations, a Plan must give prior notice to the DMHC,
which may approve, disapprove, suspend or postpone the
effectiveness of any change. Subcontractor will cooperate with Plan
to meet the filing deadlines required prior to change in providers,
provider contracts and other changes requiring filing.
H&S §1367(g) Medical Decisions. Subcontractors who are delegated for utilization
management shall ensure that medical decisions are rendered by
qualified medical providers, unhindered by fiscal and
administrative management.
H&S §1317.1,
affecting 1371.4
H&S §§ 1367.03
(g)(1), 1375.4,
1367, 1367.24,
1373.96; 28 CCR
§§ 1300.75.4.3,
1300.80,
1300.70(b)(2)(c),
1300.71,
1300.71.30, etc.
H&S §1370
Definition of Emergency. Definition used in subcontracts must
match definitions in 1317.1, including reference to emergency
mental health (crisis intervention) services.
Reporting. The Plan must file with DMHC a variety of annual,
quarterly and periodic reports, many of which require information
from the provider. The provider shall provide any information
required for the Plan to comply with applicable federal or state law.
Includes but is not limited to encounter data, claims lag reports,
accessibility reports, etc.
QI & UM system compliance. The Plan must ensure that its quality
improvement system is capable of continuously reviewing the
quality of care, performance of medical personnel, utilization of
services and facilities and costs. Subcontractors shall cooperate with
the Plan’s QI and UM Programs.
10

KNOX KEENE ACT AND REGULATIONS UNLESS PREEMPTED BY FEDERAL
LAW
Statutory/Reg. § Description of Requirement
28 CCR
Provider Direction. The Plan’s QA Program will be directed by
1300.70(a)(1) providers and document that the quality of care provided is being
reviewed, that problems are being identified, that effective action is
taken to improve care where deficiencies are identified, and that
follow‐up is planned where indicated. Subcontractors shall take
such corrective action as may be required by Plan to comply with
this requirement.
28 CCR
1300.70(a)(3)
28 CCR
1300.70(c)
28 CCR §
1300.67.4(a)(8)
and 1300.67.1 et
seq.
Service Elements. A Plan’s QA program must address service
elements, including accessibility, availability and continuity of care.
A Plan’s QA program must also monitor whether the provision and
utilization of services meets professionally recognized standards of
practice. Subcontractors shall ensure that, in providing services to
Members, they meet the Plan’s standards for those service elements
and that they meet professionally recognized standards of practice.
Continuous Review. In addition to the internal quality of care
review system, a Plan must design and implement reasonable
procedures for continuously reviewing the performance of health
care personnel and the utilization of services and facilities and cost.
The reasonableness of the procedures and the adequacy of the
implementation thereof shall be demonstrated to the Department.
Once the Plan’s procedures have been approved by the Department,
subcontractors shall cooperate with the Plan in its oversight efforts
and take such corrective action as the Plan reasonably requires.
Termination of Provider & Notice to Member. Subcontracts shall
contain a provision requiring Plan to give written notice within a
reasonable period of time to the other party when a provider has
terminated or breached its contract, or is unable to if the other party
may be materially and adversely affected thereby. To comply with
this obligation, we must have and give advance notice of
termination from/to the provider. Contract should require sufficient
notice from provider, to enable the Plan to send notices to DMHC
and members within the time period required by applicable
regulation.
11

KNOX KEENE ACT AND REGULATIONS UNLESS PREEMPTED BY FEDERAL
LAW
Statutory/Reg. § Description of Requirement
H&S §1367(b) Licensure. All personnel employed by or under contract to the Plan
must be licensed or certified by their respective board or agency,
where licensure or certification is required by law.
1367.01 Applicability of Knox Keene to UM. The requirements of the
licensing division (including the Knox Keene regulations) shall
apply to health plans and to any entity conducting utilization
review or utilization management.
H&S §1366.4(c) Credentialing Permitted for Non‐physicians. A Plan may require
the non‐physician provider to complete an appropriate
credentialing process.
H&S §1366.4(d) Provider Directory. The Plan must either list the non‐physician
providers in its provider directory or disclose in the EOC that the
Plan has contracts with non‐physician providers and what types of
providers. Subcontractors consent to the listing of their names and
other required information.
28 CCR §1300.81 Books in CA. The books and records of the Plan, management
company, solicitor firm and/or provider or other subcontractor, may
not be removed from this State without the prior consent of the
Director.
28 CCR
Access to Cost of Care. The Plan must also have access, at
§1300.67.8(c) reasonable times, to the books records and papers of the provider
relating to the health care services provided to enrollees, the cost
thereof, to payments received by the provider from enrollees (or
others acting on their behalf) and, unless the provider is
compensated on a fee for service basis, to the financial condition of
the provider.
H&S § 1395.5 False Advertising Restrictions permitted. No contract between a
Plan and a provider may prohibit, restrict or limit the provider from
advertising. But the Plan may and does prohibit advertising that is
false, misleading, untrue, deceptive or otherwise inconsistent with
the Act and the regulations thereunder. Plan and subcontractor also
have a right to protect service marks, trade secrets or other
confidential information or property.
12

KNOX KEENE ACT AND REGULATIONS UNLESS PREEMPTED BY FEDERAL
LAW
Statutory/Reg. § Description of Requirement
28 CCR § Reasonable Staffing and Provider‐Patient Ratios. Subcontractor
1300.67.1(d) & shall ensure that it meets reasonable staffing and provider or
1300.51(H) physician‐patient ratios to ensure the availability and accessibility of
services and referrals to other providers.
H&S §§1375.5 &
1375.8
Risk for Immunizations. No Plan may place a provider at risk for
the cost of immunizations, unless the provider requests the risk in
writing during contract negotiations.
1375.7 (b) Provider’s Bill of Rights. No Plan contract or subcontract may
contain terms that:
• Change a material term of the contract without 45 working days
prior notice and the right to negotiate and agree to the change or
terminate if the provider disagrees.
• Requires a provider to accept patients beyond the number
specified by contract or beyond the provider’s reasonable
capacity.
• Requires compliance with QI or UM programs or procedures
without disclosing the requirement at least 15 business days prior
to execution of the contract.
• Conflicts with the Knox Keene Act.
1367.04(f) Linguistic Accessibility. No later than January 1, 2006, all Plan
contracts with providers must require compliance with DMHC
standards regarding linguistic assistance for members obtaining
health care services. For Medi‐Cal and Healthy Families members,
Plan and its Subcontractors are required by the government
contracts to provide covered services in a manner offering linguistic
access and cultural sensitivity, including but not limited to the
obligation to arrange interpreters for non‐English speaking
members receiving care, upon request.
13

PROVISIONS REQUIRED BY MEDI‐CAL PROGRAM
PRIMARY DHCS REGULATORY AND CONTRACTUAL REQUIREMENTS WITH
RESPECT TO SUBCONTRACTORS 1 AND SUB‐SUBCONTRACTORS 2
Contract §
Exh. A, Att. 6,
§13 B (15)
Exh. A, Att. 6,
§13 B (12)
Exh. A, Att. 6,
§13 B (14)
Exh. A, Att. 6,
§13 B (13)
Exh. A, Att. 6,
§13 B (15) &
Exh. E, Att. 2,
§§23 & 24
Cal. Code of
Regulations §
or CFR §
22 CCR
§53250(e)(4) &
§53867
22 CCR
§53250(e)(6) &
§53867
22 CCR
§53250(e)(5) &
§53867
22 CCR
§14124.71
Summary of Requirements
Subcontractors and sub‐subcontractors must:
Records for Litigation. Timely gather, preserve, and
provide to the State Department of Health Services
(DHS) any records in the Subcontractor’s possession
Related to Recovery for Tobacco Related Illnesses or
other litigation.
Notice of Amendment or Termination. Notify DHS in
the event that the agreement has been amended or
terminated. If the Agreement is with a safety net
provider the notice must be given at least 30 days in
advance of the effective date of termination.
Hold Harmless. Hold the State harmless, in addition to
Plan members, if SCFHP ever fails to pay Provider, or
Provider fails to pay the subcontracting provider, for
services under this Agreement or the subcontract.
No Assignment or Delegation without Approval. Not
assign or delegate this Agreement or any subcontract
hereunder – if such assignment or delegation is
permitted under the Agreement itself ‐‐ unless prior
approval is obtained from the Department, to the extent
required. Any attempted assignment or delegation
without prior DHS and SCFHP approval will be void.
Third Party Liability. Notify DHS’s Third Party
Liability Branch and SCFHP within ten (10) calendar
days of learning of any illness or injury compensable
under Workers compensation insurance, any casualty
cases or third party tort cases. DHS has the right to
coordinate benefits and/or pursue other recovery of the
value of Covered Services in these cases and to retain
the costs of Covered Services for any such compensable
illness or injury. Neither SCFHP, nor Provider nor any
of its subcontracting providers shall collect on any such
claim.
14

PRIMARY DHCS REGULATORY AND CONTRACTUAL REQUIREMENTS WITH
RESPECT TO SUBCONTRACTORS 1 AND SUB‐SUBCONTRACTORS 2
Contract §
Exh. A, Att. 6,
§13 B (7) & (9)
& Exh. E, Att.
2, §20
Exh. A, Att. 6,
§13 B (4) & (8)
Exh. A, Att. 6,
§13 B (9) &
(20)
Exh. A, Att. 6,
§13 B (11)
Exh. A, Att. 3,
§2
Exh. E, Att. 2,
§26
Cal. Code of
Regulations §
or CFR §
22 CCR
§53250(e)(1) &
§53867
22 CCR §53250
(c)(4) & §53867
22 CCR
§53250(e)(3) &
§53867
42 CFR
§438.608
Summary of Requirements
Subcontractors and sub‐subcontractors must:
Access to Books and Records. Provide access to books,
records, papers, facilities to DHS, DHHS, DOJ and
DMHC at all reasonable times at Subcontractor’s place
of business or other mutually agreeable location in
California. All such records shall be in a form
maintained in accordance with general standards
applicable to such book and record keeping. Records,
including but not limited to encounter data, shall be
maintained for at least 5 years from the end of the last
fiscal year the subcontract was in effect. DHS has a
right to monitor, not just audit, all aspects of SCFHP’s
operations and those of its participating providers, for
compliance with applicable requirements.
Disclose Compensation. Fully disclose the method and
amount of compensation or other consideration, the
services to be provided, the beginning and end date of
the contract and the methods of extension,
renegotiation and termination. Compensation may not
be based on a percentage of the payment SCFHP
receives from DHS.
Sub‐subcontracts. Agree to make all sub‐subcontracts
available to DHS upon request and require the subsubcontractor
to comply with the same terms and
conditions DHS requires of subcontractors.
Cooperation upon Termination of Contract. Assist
SCFHP in the transfer of care (as described in the DHS
contract) in the event of subcontract termination.
Encounter Data. Provide SCFHP with encounter level
data in the manner consistent with DHS requirements.
Fraud and Abuse Program. Cooperate with SCFHP’s
program for fraud and abuse detection, investigation,
reporting and taking corrective action.
15

PRIMARY DHCS REGULATORY AND CONTRACTUAL REQUIREMENTS WITH
RESPECT TO SUBCONTRACTORS 1 AND SUB‐SUBCONTRACTORS 2
Contract §
Exh. A,
Att. 6, §13
B (2)
Exh. A,
Att. 6, §13
B (3)
Exh. A,
Att. 6, §13
B (6)
Exh. A,
Att. 6, §13
A
Exh. A,
Att. 6, §13
B (5)
Exh. A,
Att. 4
Exh. A,
Att. 4, §12
D
Cal. Code of
Regulations § or
CFR §
22 CCR
§53250(c)(2) &
§53867
22 CCR
§53250(a) &
(c)(3) & §53867
22 CCR
§53250(c)(5) &
§53867
22 CCR
§53250(c)(2) &
§53867
Summary of Requirements
Subcontractors and sub‐subcontractors must:
Governing Law. Understand that all subcontracts shall be
governed by and construed in accordance with the
contractual obligations of SCFHP to DHS.
Effective Date of Subcontracts. Specify that the terms of
the subcontract or any subsequent amendment shall
become effective only after Departmental approval, to the
extent required by the DHS‐SCFHP contract..
Reports. Agree to submit reports as required by SCFHP.
Applicable State Law. Draft the subcontracts and subsubcontracts
the Welfare and Institutions Code and
associated Medi‐Cal regulations, and other applicable
federal and state laws and regulations (such as Knox
Keene Act and Regulations).
Reinsurance if Bearing Risk. If provider is a risk bearing
organization, comply with applicable requirements
regarding reinsurance, if any.
Quality Improvement. Allow SCFHP to monitor the
quality of care delivered, cooperate with SCFHP’s QI
Plan, and participate in the QI program upon request.
Disciplinary Program. Cooperate with SCFHP’s provider
disciplinary program, under which SCFHP must report
serious quality of care problems to DHS, suspend or
terminate providers. Utilize the provider appeal process
to resolve disputes.
16

PRIMARY DHCS REGULATORY AND CONTRACTUAL REQUIREMENTS WITH
RESPECT TO SUBCONTRACTORS 1 AND SUB‐SUBCONTRACTORS 2
Contract §
Exh. A, Att. 7,
§5 & Att. 13,
§1A
Exh. A, Att. 8,
§5
Exh. A, Att. 4
& Att. 9
Exh. A, Att. 9,
§§10 & 11;
Exh. E, Att. 2,
§§28‐30.
Cal. Code of
Regulations §
or CFR §
42 CFR
§§438.610 &
455.106
Summary of Requirements
Subcontractors and sub‐subcontractors must:
Member Rights. Comply with the Plan’s written
policies on member rights, including but are not limited
to, right to: confidentiality; file a grievance; participate
in health care decisions; right to choose their
participating PCP; access to their medical records;
cultural and linguistic sensitivity; and continuity of
care.
Delegated Claims Processing. If delegated, process
claims in compliance with 42 USC §1396u‐2(f) and H&S
Code §§ 1371 through 1371.36 unless otherwise agreed
in writing by the parties.
Availability and Accessibility. Make services available
and accessible to members, consistent with the terms of
the DHS‐SCFHP contract.
Debarment. Terminate any subcontract or subsubcontract
with a debarred or suspended person (i.e.,
someone who has been barred or suspended from
participation in federally funded programs). Not
initially contract with any such person.
22 CCR § 51007 Discrimination Prohibited. Prohibit discrimination on
the basis of age, race, color, creed, religion, sex, sexual
preference, national origin, health status, genetic
characteristics, physical and/or mental disability,
income level or on the basis that they are Enrollees of a
prepaid health care plan.
Title 22, § 51007 Contract Compliance. Comply the DHS‐SCFHP
contract, in addition to complying with applicable law.
(The DHS contract specifies several laws that must be
specifically mentioned, such as the ADA, the Veteran’s
Preference laws, fraud and abuse laws, etc.
17

PRIMARY DHCS REGULATORY AND CONTRACTUAL REQUIREMENTS WITH
RESPECT TO SUBCONTRACTORS 1 AND SUB‐SUBCONTRACTORS 2
Contract §
Exh. A, Att. 9,
§§10 & 11; Exh. E,
Att. 2, §§28‐30.
Exh. A, Att. 4, §§
1 & 6
Cal. Code of
Regulations § or
CFR §
Title 22, §53250
(b)
Summary of Requirements
Subcontractors and sub‐subcontractors must:
Services. Meet the requirements of subchapters 3
& 4 of Subdivision 1 (“California Medical
Assistance Program”) related to the services the
subcontractor is to perform.
42 CFR §438.230 Accountability. The State must ensure, through its
contracts that each MCO oversees and is
accountable for any delegated functions and
responsibilities.
18

PRIMARY PROVISIONS OF TITLE 22 ON MEDI‐CAL MANAGED CARE
SUBCONTRACTS AND SUB‐SUBCONTRACTS
CCR Title Summary of Requirements
and Section
Title 22, Subcontracts must specify:
§53250 (c) & • The services to be provided
(e) & §53867 • That the subcontract shall be governed by and construed in
accordance with the all laws, regulations and contractual
obligations incumbent upon the plan.
• That the subcontract and/or amendment shall become effective
only after approval by the Department.
• The terms of the contract, including the beginning and ending
dates as well as any methods of extension, renegotiation and
termination.
• The subcontractor’s agreement to submit reports as required by
the Contractor.
• The subcontractor’s agreement to make all of its books and
records pertaining to the good sand services furnished under the
terms of the subcontract, available for expectation, examination or
copying by the DHHS, DMHC and DHS at all reasonable times at
the subcontractor’s place of business or at another mutually
agreeable location in California, and in a form maintained in
accordance with generally accepted standards.
• The subcontractor’s agreement to maintain books and records for
a term of at least five years from the close of the fiscal year in
which the contract was last in effect.
• Full disclosure of the method and amount of compensation or
other consideration received by the subcontractor.
• Subcontractor’s agreement to maintain and make available to the
Department upon request copies of all sub‐subcontracts and to
ensure that all sub‐subcontracts are in writing and require that
the subcontractor:
o Make available all applicable books and records at all
reasonable times for inspection, examination and copying by
the Department.
o Retain such books and records for a term of at least five years
from the close of the fiscal year in which the contract was last
in effect.
19

Title 22,
§53216
Title 22,
§53242
• Subcontractor’s agreement to notify, by U.S. Mail, the Department
in the event the agreement with the contractor is amended or
terminated.
• Subcontractor’s agreement that assignment or delegation of the
subcontract shall be void unless prior written approval is
obtained from the Department in those instances where prior
approval by the Department is required.
• Subcontractor’s agreement to hold harmless both the State and
plan members in the event the plan cannot or will not pay for
services performed by the subcontractor pursuant to the
subcontract.
Plan must ensure subcontractors available to provide services 24 hours a
day, 7 days a week.
Subcontractors must meet Medi‐Cal Standards of Participation.
Footnotes
1
The DHS – SCFHP Contract, at Exhibit E, Attachment 1, §100 defines a “Subcontract”
as meaning provider subcontractors or administrative subcontractors. Specifically, a
subcontract is a:
“written agreement entered into by the Contractor with any of the following:
A. A provider of health care services who agrees to furnish Covered Services
to Members.
B. Any other organization or person(s) who agree(s) to perform any
administrative function or service for the Contractor specifically related
to fulfilling the Contractorʹs obligations to DHS under the terms of this
Contract.”
2
Exhibit E, Attachment 1, §101 defines a “Sub‐subcontractor” as meaning:
“any party to an agreement with a subcontractor descending from and
subordinate to a Subcontract, which is entered into for the purpose of providing
any goods or services connected with the obligations under this Contract.“
20