WILLIAM DONALD SCHAEFER, Governor                                Ch. 9

19-1509.

(A) BY JULY 1, 1996, THE COMMISSION SHALL ADOPT REGULATIONS
ESTABLISHING A PAYMENT SYSTEM, INCLUDING A FEE SCHEDULE, FOR HEALTH
CARE SERVICES:

(1) COVERED UNDER THE COMPREHENSIVE STANDARD HEALTH
BENEFIT PLAN; AND

(2) PROVIDED BY A PHYSICIAN OR OFFICE FACILITY.

(B) THE PAYMENT SYSTEM ADOPTED IN ACCORDANCE WITH THIS SECTION
SHALL BE DESIGNED TO PROVIDE REASONABLE ASSURANCE THAT:

(1) THE FEE PAID TO A PHYSICIAN OR OFFICE FACILITY FOR A
COVERED SERVICE IS REASONABLY RELATED TO THE COST OF PROVIDING THE
SERVICE;

(2) THE PAYMENT SYSTEM, INCLUDING THE FEE SCHEDULE, APPLIES
EQUITABLY TO ALL PAYORS OR CLASSES OF PAYORS WITHOUT UNFAIR
DISCRIMINATION;

(3) THE PAYMENT SYSTEM CONTAINS APPROPRIATE PROVISIONS OR
INCENTIVES TO CONTROL THE UTILIZATION OR VOLUME OF HEALTH CARE
SERVICES RENDERED BY PHYSICIANS AND OFFICE FACILITIES; AND

(4) THE PAYMENT SYSTEM IS COORDINATED WITH THE HOSPITAL RATE
REGULATORY SYSTEM UNDER SUBTITLE 2 OF THIS TITLE AND PROMOTES THE
DEVELOPMENT OF CONSISTENT FINANCIAL INCENTIVES AMONG ALL PROVIDERS.

(C) (1) ON OR BEFORE OCTOBER 1, 1995, AND PRIOR TO IMPLEMENTING THE
PAYMENT SYSTEM UNDER THIS SECTION, THE COMMISSION SHALL SUBMIT A
PROGRESS REPORT TO THE GOVERNOR AND, IN ACCORDANCE WITH § 2-1312 OF THE
STATE GOVERNMENT ARTICLE, TO THE GENERAL ASSEMBLY ON THE
DEVELOPMENT OF THE PAYMENT SYSTEM.

(2) IN PREPARING THE PROGRESS REPORT, THE COMMISSION SHALL
CONSIDER AMONG OTHER RELEVANT FACTORS:

(I) THE CURRENT SYSTEMS USED BY THIRD PARTY PAYORS TO
REIMBURSE PHYSICIANS AND THE EXTENT TO WHICH THESE SYSTEMS INFLUENCE
THE VARIATION IN PHYSICIAN FEES;

(II) THE EXTENT TO WHICH PHYSICIAN SPECIALTY DESIGNATIONS
INFLUENCE FEES;

(III) THE RESOURCE BASED RELATIVE VALUE SYSTEM ADOPTED
BY THE FEDERAL GOVERNMENT FOR PHYSICIANS PAYMENTS UNDER MEDICARE
PART B;

(IV) THE GEOGRAPHIC VARIATION IN PRACTICE COSTS,
INCLUDING THE COST OF PROFESSIONAL LIABILITY INSURANCE;

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