Hospitals and governmental bodies in PPO contracts are presumed to receive a tangible benefit, and state agencies that work with PPO or managed care arrangements must create contracting criteria and notice rules.
§2204. Hospital participation; tangible benefit presumed A. Whenever any hospital or governmental body is a party to a preferred provider organization contract, there shall be a rebuttable presumption that such hospital or governmental body contracted with the expectation of receiving a tangible benefit rather than making a donation of services in violation of Section 14(A) of Article VII of the Constitution of Louisiana. B. Unless clearly indicated otherwise in a preferred provider organization contractual arrangement, it shall be presumed that the hospital, governmental body, or other provider negotiated the contract with the knowledge that such agreement would result in a tangible benefit to the hospital or governmental body and would not constitute a donation of its services to a group purchaser in violation of the Constitution of Louisiana, Article VII, Section 14(A). C. Whenever a hospital or governmental body is a party to a preferred provider organization contract, the provisions of R.S. 39:1481 et seq. shall not apply. D.(1) The state, or any agency of the state authorized by law to contract with or develop preferred provider organizations or other managed health care arrangements, including the Office of Group Benefits, when interested in developing or participating in a preferred provider organization or other managed care arrangement, shall develop criteria governing the state's or the agency's contracting with health care providers or with preferred provider organizations or other managed care arrangements. All such criteria shall be approved by the appropriate standing committees of the legislature having jurisdiction over review of that agency's rules, or the subcommittees on oversight of such standing committees, and the office of state procurement of the division of administration. (2) Each agency authorized by law to develop or contract with preferred provider organizations or other managed care arrangements shall promulgate rules and regulations to establish a process through which notice of intent to contract with health care providers, preferred provider organizations, or other managed care arrangements is given. The rules and regulations shall contain provisions requiring written or published notice of the agency's intent to seek contracts for the requested services and the availability, upon request, of a detailed explanation of the services sought and of the criteria that are to be used in developing contracts. There shall be a written public announcement of the contractor or contractors awarded the contract. Upon request, any entity submitting a proposal which is not accepted shall be furnished a written explanation for the agency's action. Any contract executed in violation of rules and regulations promulgated under this Subsection shall be void. (3) All contracts shall be approved by the chief executive officer in the Office of Group Benefits. (4) The provisions of this Section shall not be applicable to the Louisiana Department of Health. Added by Acts 1984, No. 374, §1, eff. July 6, 1984. Amended by Acts 1990, No. 585, §1, eff. July 19, 1990; Acts 1992, No. 864, §1; Acts 1993, No. 783, §1; Acts 2001, No. 1178, §4, eff. June 29, 2001; Acts 2014, No. 864, §§4 and 5.