N.J. Admin. Code § 10:74-14.1

Current through Register Vol. 56, No. 21, November 4, 2024

Section 10:74-14.1 - Contract sanctions

(a) Provisions under federal law relating to imposition of penalties upon providers of health care services can be found at Section 1903(m)(5)(A) of the Social Security Act.

(b) Monetary damages shall be imposed by DHS for failure of the contractor to comply with the timeliness and accuracy of claims processing; timeliness and accuracy of data submittals; contract terms and conditions; performance standards; and any losses of funds incurred by the State due to the contractor's non-compliance. (See 42 U.S.C. § 1396b(m)(5)(A); 30:4D-1; N.J.A.C. 10:49-1 and 10:49-11.)

(c) The contractor shall submit a corrective action plan for any deficiency identified by the Department. The contractor shall implement the corrective action established by the Department. Damages will be applied for failure to implement the corrective action plan. (See 42 U.S.C. 1396 b(m)(5)(A); 30:4D-1; N.J.A.C. 10:49-1 and 10:49-11.)

(d) The contractor shall comply with all performance standards, which shall be defined as compliance with all requirements specified in the contract. Failure to do so will result in the following sanctions:

1. DMAHS may suspend the contractor's right to enroll new members, for any length of time specified by DMAHS;

2. DMAHS may notify enrollees of contractor non-performance and permit enrollees to transfer to another plan without cause;

3. DMAHS may terminate the contract, under the provisions of the contract; and/or

4. DMAHS may withhold all or part of the monthly capitation payments.

(e) Should the contractor fail to satisfy any terms or requirements of the contract, damage to the State shall be presumed, and the contractor shall pay to the State its actual damages, which shall be as follows:

1. For failure to comply with any requirements concerning services provided to enrollees, DMAHS shall impose sanctions in an amount equal to the costs incurred by the State to ensure adequate service delivery to affected enrollees. (See 42 U.S.C. § 1396b(m)(5)(A); N.J.S.A. 40:4D-1; N.J.A.C. 10:49-1 and 10:49-11.) If transfers of patients are required, the costs associated with such transfers shall be assessed against the contractor;

2. For failure to comply with any material contract provisions for which damage cannot be quantified, DMAHS shall notify the contractor in writing and specify a period of time in which the contractor shall respond in writing, and will specify a reasonable period of time in which the contractor shall remedy its non-compliance. If the contractor's non-compliance is not corrected by the specified date, DMAHS shall assess sanctions, as provided for in the contract; and

3. DMAHS shall deduct sanctions from any money payable to the contractor.

(f) Should DMAHS determine that there is egregious behavior by the managed care organization or that there is substantial risk to the health of the managed care entity's enrollees, temporary management may be imposed during the period in which improvements may be made to correct these violations. Temporary management shall remain in place until DMAHS determines that the contractor has the capability to ensure that the violations will not recur.

N.J. Admin. Code § 10:74-14.1

Amended by R.2000 d.287, effective 7/3/2000.
See: 32 New Jersey Register 1345(a), 32 New Jersey Register 2498(a).
Added (f).
Amended by R.2006 d.17, effective 1/3/2006.
See: 37 New Jersey Register 2787(a), 38 New Jersey Register 294(d).
In (b), added "contract terms and conditions; performance standards;" after "data submittals;"; in (d)2, added "without cause" after "another plan"; in (e), added ", which shall be as follows:" to the end of the introductory paragraph.