As used in this chapter, the following terms shall have the following meanings:

(1) HEALTH BENEFIT PLAN. A health insurance policy that covers hospital, medical, or surgical expenses, health maintenance organizations, preferred provider organizations, medical service organizations, physician-hospital organizations, or any other person, firm, corporation, joint venture, or other similar business entity that pays for, purchases, or furnishes health care services to patients, insureds, or beneficiaries in this state. For the purpose of this chapter, a health benefit plan located or domiciled outside of the State of Alabama is deemed to be subject to the provisions of this chapter if it receives, processes, adjudicates, pays, or denies claims for health care services submitted by or on behalf of the State of Alabama or who receive health care services in the State of Alabama. The term includes, but is not limited to, entities created pursuant to Article 6 of Chapter 4 of Title 10.

(2) MEDICALLY NECESSARY. A medical or surgical service, including inpatient hospital care, is medically necessary when in the opinion of the attending physician or the attending certified nurse midwife practicing in collaboration with an obstetrician-gynecologist, the patient's health would be adversely affected if the service is withheld or discontinued. Medically necessary postpartum care for a mother and a newly born child shall be consistent with the most recent version of the 'Guidelines for Perinatal Care' prepared by the American Academy of Pediatrics and the American College of Obstetricians and Gynecologists.

(a) Every health benefit plan that provides maternity coverage shall provide coverage for the following:

(1) All medically necessary inpatient care for a mother and her newly born child as determined by the woman's prenatal care physician, obstetrician-gynecologist, certified nurse midwife, or the child's attending pediatrician and when consistent with the most recent version of the 'Guidelines for Prenatal Care' prepared by the American Academy of Pediatrics and the American College of Obstetricians and Gynecologists, including the administration of medical tests recommended by the American Academy of Pediatrics or the American College of Obstetricians and Gynecologists or both on the admission and discharge of a mother and the newborn child to determine whether additional medical care is needed for the mother or newborn child or both. Included in medically necessary inpatient care is the requirement that all hospitals providing a maternity hospital stay perform a complete blood count with differential, or its equivalent, on the mother upon admission and discharge of the mother from the hospital.

(2) Benefits for any hospital length of stay of not less than 48 hours in connection with childbirth for the mother or newborn child, following a normal vaginal delivery.

(3) Benefits for any hospital length of stay of not less than 96 hours in connection with childbirth for the mother or newborn child, following a cesarean section.

(b) Notwithstanding the provisions of subdivisions (2) and (3) of subsection (a), a mother may be discharged early if she, after being advised by her medical provider in writing of the advantages and disadvantages of early discharge, consents in writing, and the medical provider agrees to the early discharge.

No health benefit plan subject to the provisions of this chapter shall terminate the services, reduce capitation payment, or otherwise penalize an attending physician, certified nurse midwife, or other health care provider who orders medical care consistent with this chapter. No health benefit plan shall provide, directly or indirectly, any financial incentive or disincentive or grant or deny any special favor or advantage of any kind or nature to any person to encourage or cause early discharge of a hospital patient from postpartum care, excluding capitation or global fee arrangements. Provided nothing contained in this chapter is intended to expand the list or designation of covered providers as specified in any health benefit plan or to modify the scope of practice of a certified nurse midwife as provided by law.

A license issued by the Department of Insurance to an insurance company or a health maintenance organization shall be subject to suspension, revocation, or imposition or other administrative penalty authorized by law, within the discretion of the Commissioner of Insurance, for any violation of the provisions of this chapter.

This chapter shall apply to all programs administered by the Alabama Medicaid Agency.