Bill Text: NJ S629 | 2018-2019 | Regular Session | Introduced
Bill Title: "New Jersey Health Insurance Advocate Act;" establishes Office of Health Insurance Advocate.
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Introduced - Dead) 2018-01-09 - Introduced in the Senate, Referred to Senate Commerce Committee [S629 Detail]
Download: New_Jersey-2018-S629-Introduced.html
STATE OF NEW JERSEY
218th LEGISLATURE
PRE-FILED FOR INTRODUCTION IN THE 2018 SESSION
Sponsored by:
Senator ROBERT M. GORDON
District 38 (Bergen and Passaic)
SYNOPSIS
"New Jersey Health Insurance Advocate Act;" establishes Office of Health Insurance Advocate.
CURRENT VERSION OF TEXT
Introduced Pending Technical Review by Legislative Counsel.
An Act concerning health insurance, revising various parts of the statutory law and supplementing Title 26 of the Revised Statutes.
Be It Enacted by the Senate and General Assembly of the State of New Jersey:
1. (New section) Sections 1 through 15 of P.L. , c. (C. ) (pending before the Legislature as this bill) shall be known and may be cited as the "New Jersey Health Insurance Advocate Act."
2. (New section) As used in sections 1 through 15 of P.L. , c. (C. ) (pending before the Legislature as this bill):
"Advocate" means the Health Insurance Advocate appointed pursuant to section 3 of P.L. , c. (C. ) (pending before the Legislature as this bill).
"Carrier" means an entity that contracts or offers to contract to provide, deliver, arrange for, pay for, or reimburse any of the costs of health care services under a health benefits plan, including: an insurance company authorized to issue health benefits plans; a health maintenance organization; a health, hospital, or medical service corporation; a multiple employer welfare arrangement; an entity under contract with the State Health Benefits Program and the School Employees' Health Benefits Program to administer a health benefits plan; or any other entity providing a health benefits plan, including any entity providing or administering a self-funded health benefits plan.
"Commissioner" means the Commissioner of Banking and Insurance.
"Claim" means any claim filed under a health benefits plan.
"Health benefits plan" means a benefits plan which pays or provides hospital, medical, prescription, or dental expense benefits for covered services, and is delivered or issued for delivery in this State by or through a carrier. "Health benefits plan" shall include the following plans, policies or contracts: Medicaid, Medicare, Medicare Advantage, accident only, credit, disability, long-term care, TRICARE supplement coverage.
3. (New section) There is created within the Department of Banking and Insurance the Office of the Health Care Advocate. The advocate shall be appointed by the Governor with the advice and consent of the Senate and shall serve at the pleasure of the Governor during the Governor's term of office. The advocate shall devote their entire time to the duties of the office. Any vacancy occurring in the position of advocate shall be filled in the same manner as the original appointment. If the advocate shall be unable for any reason to serve the full term of office, the Governor may designate an acting advocate until a successor is appointed and qualified. The advocate shall have at least a baccalaureate degree and at least seven years' experience in health insurance.
4. (New section) The advocate shall:
a. administer and organize the work of the office and hire such persons as shall be deemed necessary to effectuate his duties, subject to Title 11A (Civil Service) of the New Jersey Statutes, and within the limits of funds made available by the Department of Banking and Insurance;
b. appoint and employ attorneys, in accordance with any applicable law, regulation or executive order, and any consultants, independent adjusters, claims specialists or others for the purpose of providing professional advice as the advocate may from time to time require, within the limits of the funds provided therefor;
c. investigate consumer complaints regarding policies of health insurance, including the payment of claims on policies of health insurance;
d. respond to inquiries from health insurance consumers, including, but not limited to, those regarding policy provisions and the availability of coverage;
e. publish and disseminate buyers' guides and, where provided by law, comparative rates;
f. promulgate such rules and regulations as shall be necessary to effectuate the purposes of P.L. , c. (C. ) (pending before the Legislature as this bill);
g. provide information to the public, agencies, legislators, and others regarding problems and concerns of the health insurance consumers and make recommendations for resolving those problems;
h. analyze and monitor the development and implementation of federal, State, and local laws, regulations, and policies relating to health insurance consumers and recommend changes it deems necessary;
i. create and make available to employers a notice, suitable for posting in the workplace, concerning the services the Advocate provides;
j. take any other actions necessary to fulfill the purposes of P.L. , c. (C. ) (pending before the Legislature as this bill); and
k. perform such other functions as may be prescribed by this or by any other law or regulation.
5. (New section) In any investigation involving a disputed claim, the advocate may:
a. investigate whether the claims settlement was appropriate and in accordance with the contract;
b. make the necessary inquiries and obtain such information as he deems necessary;
c. hold a hearing on the disputed claim; and
d. inspect any books or records which are relevant to the claim;
e. compel any person to produce at a specific time and place, by subpoena, any documents, books, records, papers, objects or other evidence which he believes may relate to a claim under investigation.
6. (New section) Any person who believes that a carrier has failed or refused to settle a claim in accordance with the provisions of the insurance contract or engaged in any practice in violation of the law may file an application with the advocate for a review of the claims settlement. However, the advocate need not investigate any complaint if he determines that:
a. the complaint is trivial, frivolous, vexatious or not made in good faith;
b. the complaint has been too long delayed to justify present investigation;
c. the resources available, considering the established priorities, are insufficient for an adequate investigation; or
d. the matter complained of is not within the investigatory authority of the office.
7. (New section) The advocate shall maintain a central registry of all claims investigations which have been disposed of and closed, the nature of the investigation, findings, and recommended actions. No information so compiled shall be construed to be a public record. In addition, the advocate shall:
a. report to the commissioner any evidence that an insurer has established a pattern of settlement practices which would constitute an unfair claims settlement practice within the meaning of P.L.1947, c.379 (C.17:29B-1 et seq.) or any violations of law; and
b. report to the commissioner any contract provision, including any endorsements, which are unfairly discriminatory, confusing, misleading or contrary to public policy, along with a recommendation as to whether the policy form should be modified or withdrawn.
8. (New section) a. All functions, powers, and duties now vested under the Managed Health Care Consumer Assistance Program in the Department of Banking and Insurance, as referenced in section 3 of P.L.2001, c.14 (C.26:2S-21), are hereby transferred to and assumed by the Office of the Health Care Advocate.
b. The advocate shall coordinate functions and duties, as appropriate, with the Director of the Division of Mental Health Advocacy established pursuant to section 29 of P.L.2005, c.155 (C.52:27EE-29) and the Office of the Insurance Claims Advocate established pursuant to section 48 of P.L.1998, c.21 (C.17:29E-2).
c. Whenever, in any law, rule, regulation, order, reorganization plan, contract, document, judicial or administrative proceeding, or otherwise, reference is made to the Managed Health Care Consumer Assistance Program, prior to and including its transfer to the Department of Banking and Insurance as part of the department's Office of Insurance Claims Advocate, the same shall mean and refer to the Office of the Health Care Advocate.
9. (New section) Complaints shall be filed on a form set forth by the advocate. The office of the advocate shall acknowledge the receipt of complaints, and advise the applicants of any action taken or opinions and recommendations which may have been made by it to the insurer. The advocate shall make recommendations to the commissioner as he deems necessary, including, but not limited to:
a. a recommendation that a policy form or endorsement thereon which he finds unfairly discriminatory, misleading or contrary to public policy be modified;
b. a recommendation that specific rules and regulations promulgated by the commissioner, including rules concerning trade practices and claims settlement practices, be modified or repealed;
c. a recommendation that the claims settlement practices of a specific insurer or insurers be further investigated by the commissioner; and
d. a recommendation that the commissioner impose penalties or other sanctions against an insurer or insurers as a result of the insurer's claims settlement practices.
10. (New section) The Office of the Insurance Claims Advocate, established pursuant to section 48 of P.L.1998, c.21 (C.17:29E-2), shall refer any matter within the purview of the Health Care Advocate created pursuant to P.L. , c. (C. ) (pending before the Legislature as this bill), to the Office of the Health Care Advocate as soon as possible after notification of the matter.
11. (New section) Every buyer's guide which is required to be provided to insureds for health insurance shall contain a notice describing the functions of the advocate, the mailing address of the advocate, the website of the advocate, and a toll-free information telephone number. The advocate may publicize his existence, function and activities to the public at large.
12. (New section) a. Any correspondence or written communication from any complainant and any written material submitted by a carrier shall remain confidential and shall not be part of any public record, unless the parties authorize, in writing, the release of the information, or except for such disclosures as may be necessary to enable the advocate to perform his duties and to support any opinions or recommendations or as may be necessary to enable the commissioner to perform any function authorized by law.
b. Any person conducting or participating in any investigation of a complaint who discloses to any person, other than the Office of the Health Insurance Advocate or the Department of Banking and Insurance, or those authorized by the advocate or the commissioner to receive it, any information collected during the investigation, is guilty of a disorderly person's offense.
c. Any statement or communication made by the office of the advocate relevant to a complaint received by the advocate, to proceedings conducted either by the advocate or by or on behalf of the commissioner, or relating to an investigation conducted by the advocate, which is provided to the office in good faith, shall be absolutely privileged.
d. The advocate shall not be required to testify in court with respect to matters held to be confidential except as the court may deem necessary in enforcing this act or as the commissioner may deem necessary in conjunction with the execution of any power of the commissioner authorized by law.
e. Nothing in this section shall be deemed to limit the disclosure of information to law enforcement and regulatory agencies.
13. (New section) Upon making his determination as to the appropriate disposition of a claim, the advocate shall notify the carrier and the claimant of his decision. The decision shall be admissible in any administrative action, court action or any other proceeding which is instituted to determine final disposition of the claim. The advocate may file a brief with the court in connection with an action relating to the disposition of a claim.
14. (New section) Any person who willfully hinders the lawful actions of the advocate or willfully refuses to comply with the advocate's lawful demands, including the demand for the inspection of records, shall be subject to a penalty of not more than $5,000. The penalty shall be collected and enforced by summary proceedings pursuant to the "Penalty Enforcement Law of 1999," P.L.1999, c.274 (C.2A:S8-10 et seq.). Each violation of P.L. , c. (C. ) (pending before the Legislature as this bill) shall constitute a separate offense.
15. (New section) The advocate shall report to the Governor and the Legislature on or before September 30 of each year, summarizing the office's activities for the preceding year, documenting any significant health insurance industry problems with regard to accessing care, accessing coverage, affordability, and claims practices and setting forth any recommendations for statutory or regulatory change which will further the State's capacity to resolve these concerns.
16. Section 50 of P.L.1998, c.21 (C.17:29E-4) is amended to read as follows:
50. Any person who: a. has reasonable cause to believe that an insurer has failed or refuses to settle a claim in accordance with the provisions of the insurance contract or engaged in any practice in violation of the provisions of P.L.1985, c.179 (C.17:23A-1 et seq.), P.L.1947, c.379 (C.17:29B-1 et seq.), P.L.1982, c.95 (C.17:35C-1 et seq.), chapter 30 of Title 17B of the New Jersey Statutes or section 8 of P.L.1992, c.144 (C.17:35C-11); and, in the case of disputed claims, b. has previously filed an appeal with the insurer's internal appeals procedure established pursuant to section 55 of [this amendatory and supplementary act] P.L.1998, c.21 (C.17:29F-9), which has been adjudicated, or other dispute resolution procedure established pursuant to P.L.1972, c.70 (C.39:6A-1 et seq.) [, P.L.1997, c.192 (C.26:2S-1 et seq.),] or sections 1 through 12 of P.L.1983, c.358 (C.39:6A-24 through 39:6A-35, inclusive) may file an application with the ombudsman for a review of the claims settlement. Any disputes which may be or have been filed or adjudicated pursuant to sections 24 and 25 of P.L.1998, c.21 (C.39:6A-5.1 and C.39:6A-5.2) shall not be subject to the ombudsman's review. Any application received by the ombudsman concerning an appeal filed pursuant to P.L.1997, c.192 (C.26:2S-1 et seq.) shall be referred to the Health Care Advocate established pursuant to P.L. , c. (C. )(pending before the Legislature as this bill) as soon as possible.
(cf: P.L.1998, c.21, s.50)
17. Section 3 of P.L.2001, c.14 (C.26:2S-21) is amended to read as follows:
3. a. There is established the Managed Health Care Consumer Assistance Program in the Department of Banking and Insurance. The [commissioner shall make agreements to] Health Care Advocate established pursuant to P.L. , c. (C. )(pending before the Legislature as this bill) shall operate the program [as necessary, in consultation with the Commissioner of Human Services,] to assure that citizens have reasonable access to services in all regions of the State.
b. The program shall:
(1) create and provide educational materials and training to consumers regarding their rights and responsibilities as enrollees in managed care plans, including materials and training specific to Medicaid, NJ FamilyCare, Medicare, employer-sponsored plans, and commercial managed care plans;
(2) assist and educate individual enrollees about the functions of the State and federal agencies that regulate managed care products, assist and educate enrollees about the various complaint, grievance, and appeal processes, including State fair hearings, provide assistance to individuals in determining which process is most appropriate for the individual to pursue when necessary, maintain and provide to individual enrollees the forms that may be necessary to submit a complaint, grievance or appeal with the State or federal agencies, and provide assistance to individual enrollees in completion of the forms, if necessary;
(3) maintain and provide information to individuals upon request about advocacy groups, including legal services programs Statewide and in each county that may be available to assist individuals, and maintain lists of State and Congressional representatives and the means by which to contact representatives, for distribution upon request;
(4) maintain a toll-free telephone number for consumers to call for information and assistance. The number shall be accessible to the deaf and hard of hearing, and staff or translation services shall be available to assist non-English proficient individuals who are members of language groups that meet population thresholds established by the department;
(5) ensure that individuals have timely access to the services of, and receive timely responses from, the program;
(6) provide feedback to managed care plans, beneficiary advisory groups and employers regarding enrollees' concerns and problems;
(7) provide nonpartisan information about federal and State activities relative to managed care, and provide assistance to individuals in obtaining copies of pending legislation, statutes, and regulations; and
(8) develop and maintain a data base monitoring the degree of each type of service provided by the program to individual enrollees, the types of concerns and complaints brought to the program and the entities about which complaints and concerns are brought.
c. In order to meet its objectives, the program and the advocate shall have access to:
(1) the medical and other records of an individual enrollee maintained by a managed care plan, upon the specific written authorization of the enrollee or his legal representative;
(2) the administrative records, policies, and documents of managed care plans to which individuals or the general public have access; and
(3) all licensing, certification, and data reporting records maintained by the State or reported to the federal government by the State that are not proprietary information or otherwise protected by law, with copies thereof to be supplied to the program by the State upon the request of the program.
d. The program and the advocate shall take such actions as are necessary to protect the identity and confidentiality of any complainant or other individual with respect to whom the program maintains files or records. Any medical or personally identifying information received or in the possession of the program shall be considered confidential and shall be used only by the department, the program and such other agencies as the commissioner designates and shall not be subject to public access, inspection or copying under P.L.1963, c.73 (C.47:1A-1 et seq.) or the common law concerning access to public records. This subsection shall not be construed to limit the ability of the program or advocate to compile and report non-identifying data pursuant to paragraph (8) of subsection b. of this section.
e. The program shall seek to coordinate its activities with consumer advocacy organizations, legal assistance providers serving low-income and other vulnerable health care consumers, managed care and health insurance counseling assistance programs, and relevant federal and State agencies to assure that the information and assistance provided by the program are current and accurate.
f. Until such time as the program is developed, the commissioner shall make agreements with two independent, private nonprofit consumer advocacy organizations, which shall be the Community Health Law Project and New Jersey Protection and Advocacy, Inc. to operate the program on an interim basis. The interim program shall be in effect for one year from the effective date of this act. Any appropriation in this act for the program may be allocated for the interim program.
(cf: P.L.2012, c.17, s.303)
18. This act shall take effect on the first day of the seventh month next after enactment.
STATEMENT
This bill establishes the Office of the Health Care Advocate in the Department of Banking and Insurance as an advocate for health insurance consumers in New Jersey. The advocate would assist health insurance consumers in all types of private and public health insurance plans to navigate the purchase of health insurance, as well as, obtaining access to care.
In addition to the responsibilities assigned to the advocate under this bill, the functions of the Managed Health Care Consumer Assistance Program and the health insurance related responsibilities of the Office of the Insurance Claims Advocate, both in the Department of Banking and Insurance, are transferred to the Office of the Health Care Advocate.
The advocate is to be appointed by the Governor with the advice and consent of the Senate and shall serve at the pleasure of the Governor during the Governor's term of office. The advocate is to devote his entire time to the duties of his office. Any vacancy occurring in the position of advocate shall be filled in the same manner as the original appointment. If the advocate shall be unable for any reason to serve his full term of office, the Governor may designate an acting advocate until a successor is appointed and qualified. The advocate must have at least a baccalaureate degree and at least seven years' experience in health insurance.
The advocate's responsibilities include:
- Administering and organizing the work of the office and hire such persons as shall be deemed necessary to effectuate his duties, subject to Title 11A (Civil Service) of the New Jersey Statutes, and within the limits of funds made available by the Department of Banking and Insurance;
- Appointing and employing attorneys, in accordance with any applicable law, regulation or executive order, and any consultants, independent adjusters, claims specialists or others for the purpose of providing professional advice as the advocate may from time to time require, within the limits of the funds provided therefor;
- Investigating consumer complaints regarding policies of health insurance, including the payment of claims on policies of health insurance;
- Responding to inquiries from health insurance consumers, including, but not limited to, those regarding policy provisions and the availability of coverage;
- Publishing and disseminating buyers' guides and, where provided by law, comparative rates;
- Promulgating such rules and regulations as shall be necessary to effectuate the purposes of this act;
- Providing information to the public, agencies, legislators, and others regarding problems and concerns of the health insurance consumers and make recommendations for resolving those problems;
- Analyzing and monitoring the development and implementation of federal, State, and local laws, regulations, and policies relating to health insurance consumers and recommending changes the advocate deems necessary;
- Creating and making available to employers a notice, suitable for posting in the workplace, concerning the services the Advocate provides; and
- Taking any other actions
necessary to fulfill the purposes of the bill.
In any investigation involving a disputed claim, the advocate may:
- Investigate whether the claims settlement was appropriate and in accordance with the contract;
- Make the necessary inquiries and obtain such information as he deems necessary;
- Hold a hearing on the disputed claim;
- Inspect any books or records which are relevant to the claim; and
- Compel any person to produce at a specific time and place, by subpoena, any documents, books, records, papers, objects or other evidence which he believes may relate to a claim under investigation.
The bill provides that any person who believes that a carrier has failed or refuses to settle a claim in accordance with the provisions of the insurance contract or engaged in any practice in violation of the law may file an application with the advocate for a review of the claims settlement.
The advocate shall maintain a central registry of all claims investigations which have been disposed of and closed, the nature of the investigation, findings, and recommended actions. No information so compiled shall be construed to be a public record.
The bill also provides that all functions, powers, and duties now vested under the Managed Health Care Consumer Assistance Program in the Department of Banking and Insurance are transferred to and assumed by the newly created Office of the Health Care Advocate. The advocate is directed to coordinate functions and duties, as appropriate, with the Director of the Division of Mental Health Advocacy and the Office of the Insurance Claims Advocate.
The bill also directs the current Office of the Insurance Claims Ombudsman to refer any matter within the purview of the Health Care Advocate created pursuant to this bill, to the Office of the Health Care Advocate as soon as possible after notification of the matter.
Correspondence or written communication from any complainant and any written material submitted by a carrier will remain confidential and shall not be part of any public record, unless the parties authorize release of the information.
Upon making his determination as to the appropriate disposition of a claim, the advocate shall notify the carrier and the claimant of his decision. The decision is admissible in any administrative action, court action or any other proceeding which is instituted to determine final disposition of the claim. The advocate may file a brief with the court in connection with an action relating to the disposition of a claim.
The advocate is also required to report to the Governor and the Legislature on or before September 30 of each year, summarizing the office's activities for the preceding year, documenting any significant health insurance industry problems with regard to accessing care, accessing coverage, affordability, and claims practices and setting forth any recommendations for statutory or regulatory change which will further the State's capacity to resolve these concerns.
