Bill Text: NY A04612 | 2019-2020 | General Assembly | Introduced


Bill Title: Enacts provisions relating to collective negotiations by health care providers with certain health care plans in certain counties; applies to health benefit plans that provide benefits for medical or surgical expenses incurred as a result of a health condition, accident or sickness, including an individual, group, blanket or franchise insurance policy or insurance agreement offered by certain enumerated entities.

Spectrum: Moderate Partisan Bill (Democrat 25-4)

Status: (Introduced) 2019-02-04 - referred to health [A04612 Detail]

Download: New_York-2019-A04612-Introduced.html


                STATE OF NEW YORK
        ________________________________________________________________________
                                          4612
                               2019-2020 Regular Sessions
                   IN ASSEMBLY
                                    February 4, 2019
                                       ___________
        Introduced  by  M.  of  A.  PRETLOW,  GOTTFRIED, CAHILL, COLTON, WEPRIN,
          MAGNARELLI, PERRY, BRONSON, L. ROSENTHAL, LAVINE,  THIELE,  BENEDETTO,
          PEOPLES-STOKES,  ABINANTI,  ENGLEBRIGHT -- Multi-Sponsored by -- M. of
          A. ABBATE, AUBRY, COOK, CYMBROWITZ, DINOWITZ, GLICK, LENTOL,  LUPARDO,
          MALLIOTAKIS,  MONTESANO,  ORTIZ,  RA,  RAIA,  WRIGHT  -- read once and
          referred to the Committee on Health
        AN ACT to amend the public health law, in relation to  requirements  for
          collective  negotiations  by health care providers with certain health
          benefit plans in certain counties, and providing  for  the  repeal  of
          such provisions upon expiration thereof
          The  People of the State of New York, represented in Senate and Assem-
        bly, do enact as follows:
     1    Section 1. Statement of legislative intent. The legislature finds that
     2  collective negotiation by competing health care providers for the  terms
     3  and  conditions  of contracts with health plans can result in beneficial
     4  results  for  health  care  consumers.  The  legislature  further  finds
     5  instances  where  health plans dominate the market to such a degree that
     6  fair and adequate negotiations between health  care  providers  and  the
     7  plans are adversely affected, so that it is necessary and appropriate to
     8  provide for a demonstration to examine the risks and benefits associated
     9  with  a  system of collective action on behalf of health care providers.
    10  Consequently, the legislature finds it appropriate and necessary in  the
    11  demonstration  service  area  to displace competition with regulation of
    12  health plan-provider agreements and authorize collective negotiations on
    13  the terms and conditions of the relationship between health  care  plans
    14  and  health  care  providers  so the imbalances between the two will not
    15  result in adverse conditions of health care. This act is not intended to
    16  apply to or affect in any respect  collective  bargaining  relationships
    17  involving health care providers as defined in section 4920 of the public
    18  health  law  or  rights  relating to collective bargaining arising under
    19  applicable federal or state collective bargaining statutes.
         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD04948-01-9

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     1    § 2. This act shall be known and may be  cited  as  the  "health  care
     2  consumer and provider protection act".
     3    §  3.  Article  49 of the public health law is amended by adding a new
     4  title III to read as follows:
     5                                  TITLE III
     6                   COLLECTIVE NEGOTIATIONS BY HEALTH CARE
     7                      PROVIDERS WITH HEALTH CARE PLANS
     8  Section 4920. Definitions.
     9          4921. Non-fee related collective negotiation authorized.
    10          4922. Fee related collective negotiation.
    11          4923. Collective negotiation requirements.
    12          4924. Requirements for health care providers' representative.
    13          4925. Certain collective action prohibited.
    14          4926. Fees.
    15          4927. Monitoring of agreements.
    16          4928. Confidentiality.
    17          4929. Severability and construction.
    18    § 4920. Definitions. For purposes of this title:
    19    1. "Health care plan" means  an  entity  (other  than  a  health  care
    20  provider) that approves, provides, arranges for, or pays for health care
    21  services  in  the  demonstration service area, including but not limited
    22  to:
    23    (a) a health maintenance organization  licensed  pursuant  to  article
    24  forty-three  of  the  insurance  law  or  certified  pursuant to article
    25  forty-four of this chapter;
    26    (b) any other organization certified pursuant to article forty-four of
    27  this chapter; or
    28    (c) an insurer or corporation subject to the insurance law.
    29    2. "Person" means an  individual,  association,  corporation,  or  any
    30  other legal entity.
    31    3.  "Health care providers' representative" means a third party who is
    32  authorized by health care providers to negotiate on  their  behalf  with
    33  health  care plans over contractual terms and conditions affecting those
    34  health care providers.
    35    4. "Strike" means a work stoppage in part or in whole, direct or indi-
    36  rect, by a body of workers to gain compliance with demands  made  on  an
    37  employer.
    38    5.  "Substantial  market  share in a business line" exists if a health
    39  care plan's market share of a business  line  within  the  demonstration
    40  service  area  as approved by the commissioner, in consultation with the
    41  superintendent of financial services, alone or in combination  with  the
    42  market  shares  of  affiliates,  exceeds either ten percent of the total
    43  number of covered lives in that service area for such business  line  or
    44  twenty-five thousand lives, or if the commissioner, in consultation with
    45  the superintendent of financial services, determines the market share of
    46  the insurer in the relevant insurance product and geographic markets for
    47  the  services of the providers seeking to collectively negotiate signif-
    48  icantly exceeds the countervailing market share of the providers  acting
    49  individually.
    50    6.  "Health  care provider" means a person who is licensed, certified,
    51  or registered pursuant to title eight of the education law and who prac-
    52  tices as a health care provider as an independent contractor and/or  who
    53  is  an  owner,  officer,  shareholder,  or  proprietor  of a health care
    54  provider in the demonstration service area.    A  health  care  provider
    55  under title eight of the education law who practices as an employee of a

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     1  health  care  provider  shall  not  be deemed a health care provider for
     2  purposes of this title.
     3    7.  "Demonstration service area" shall include the counties of Albany,
     4  Columbia, Greene, Orange, Rensselaer, Saratoga, Schenectady,  Schoharie,
     5  Ulster, Warren and Washington.
     6    §  4921.  Non-fee related collective negotiation authorized. 1. Health
     7  care providers practicing within the demonstration service area may meet
     8  and communicate for the  purpose  of  collectively  negotiating  with  a
     9  health  care  plan  the  following  terms  and  conditions  of  provider
    10  contracts with the health care plan:
    11    (a) the details of the utilization review plan as defined pursuant  to
    12  subdivision  ten  of  section  forty-nine  hundred  of  this article and
    13  subsection (j) of section four thousand nine hundred  of  the  insurance
    14  law;
    15    (b)  coverage  provisions;  health  care  benefits;  benefit maximums,
    16  including benefit limitations; and exclusions of coverage;
    17    (c) the definition of medical necessity;
    18    (d) the clinical practice guidelines used to  make  medical  necessity
    19  and utilization review determinations;
    20    (e) preventive care and other medical management practices;
    21    (f)  drug  formularies  and  standards  and procedures for prescribing
    22  off-formulary drugs;
    23    (g) respective physician liability for the treatment or lack of treat-
    24  ment of covered persons;
    25    (h) the details of health care plan risk  transfer  arrangements  with
    26  providers;
    27    (i)  plan  administrative  procedures, including methods and timing of
    28  health care provider payment for services;
    29    (j) procedures to be utilized to resolve disputes between  the  health
    30  care plan and health care providers;
    31    (k)  patient  referral procedures including, but not limited to, those
    32  applicable to out-of-pocket network referrals;
    33    (l) the formulation and application of health care provider reimburse-
    34  ment procedures;
    35    (m) quality assurance programs;
    36    (n)  the  process  for  rendering  utilization  review  determinations
    37  including:  establishment  of a process for rendering utilization review
    38  determinations which shall, at a minimum, include: written procedures to
    39  assure that utilization reviews and determinations are conducted  within
    40  the  timeframes  established  in  this  article; procedures to notify an
    41  enrollee, an  enrollee's  designee  and/or  an  enrollee's  health  care
    42  provider of adverse determinations; and procedures for appeal of adverse
    43  determinations,  including  the  establishment  of  an expedited appeals
    44  process for denials of continued inpatient care or where there is  immi-
    45  nent or serious threat to the health of the enrollee; and
    46    (o)  health  care  provider selection and termination criteria used by
    47  the health care plan.
    48    2. Nothing in this section shall be construed to allow or authorize an
    49  alteration of the terms of the internal and external  review  procedures
    50  set forth in law.
    51    3.  Nothing  in this section shall be construed to allow a strike of a
    52  health care plan by health care providers  or  plans  as  otherwise  set
    53  forth in the laws of this state.
    54    4.  Nothing  in  this section shall be construed to allow or authorize
    55  terms or conditions which would impede the ability of a health care plan

        A. 4612                             4
     1  to obtain or retain accreditation by the national committee for  quality
     2  assurance or a similar body.
     3    § 4922. Fee related collective negotiation. 1. If the health care plan
     4  has  substantial  market  share  in a business line in the demonstration
     5  service area, health care providers practicing within the  demonstration
     6  service  area  may collectively negotiate the following terms and condi-
     7  tions relating to that business line with the health care plan:
     8    (a) the fees assessed by the health care plan for services,  including
     9  fees established through the application of reimbursement procedures;
    10    (b)  the  conversion  factors  used  by  the  health  care  plan  in a
    11  resource-based relative value scale reimbursement methodology  or  other
    12  similar  methodology; provided the same are not otherwise established by
    13  state or federal law or regulation;
    14    (c) the amount of any discount granted by the health care plan on  the
    15  fee of health care services to be rendered by health care providers;
    16    (d)  the  dollar  amount  of  capitation  or  fixed payment for health
    17  services rendered by health care providers to health  care  plan  enrol-
    18  lees;
    19    (e)  the  procedure code or other description of a health care service
    20  covered by a payment and  the  appropriate  grouping  of  the  procedure
    21  codes; or
    22    (f) the amount of any other component of the reimbursement methodology
    23  for a health care service.
    24    2.  Nothing  herein  shall be deemed to affect or limit the right of a
    25  health care provider or group of health care providers  to  collectively
    26  petition a government entity for a change in a law, rule, or regulation.
    27    § 4923. Collective negotiation requirements. 1. Collective negotiation
    28  rights granted by this title must conform to the following requirements:
    29    (a)  health  care  providers  may  communicate  with other health care
    30  providers regarding the contractual terms and conditions to  be  negoti-
    31  ated with a health care plan;
    32    (b)  health care providers may communicate with health care providers'
    33  representatives;
    34    (c) a health care providers' representative is the only party  author-
    35  ized  to  negotiate  with health care plans on behalf of the health care
    36  providers as a group;
    37    (d) a health care provider can be bound by the  terms  and  conditions
    38  negotiated by the health care providers' representatives; and
    39    (e)  in  communicating  or negotiating with the health care providers'
    40  representative, a health care plan is entitled to contract with or offer
    41  different contract terms and conditions to individual  competing  health
    42  care providers.
    43    2. A health care providers' representative may not represent more than
    44  thirty percent of the market of health care providers or of a particular
    45  health  care  provider type or specialty practicing in the demonstration
    46  service area or proposed service area of a health care plan that  covers
    47  less  than  five  percent  of  the actual number of covered lives of the
    48  health care plan in the demonstration service area, as determined by the
    49  department.
    50    3. Nothing in this section shall be construed to  prohibit  collective
    51  action  on  the  part  of  any health care provider who is a member of a
    52  collective bargaining unit recognized pursuant  to  the  national  labor
    53  relations act.
    54    §  4924.  Requirements  for  health care providers' representative. 1.
    55  Before engaging in collective negotiations with a health  care  plan  on
    56  behalf of health care providers, a health care providers' representative

        A. 4612                             5
     1  shall  file  with  the  commissioner,  in  the  manner prescribed by the
     2  commissioner, information identifying the representative, the  represen-
     3  tative's  plan  of  operation,  and  the  representative's procedures to
     4  ensure compliance with this title.
     5    2.  Before  engaging  in  the collective negotiations, the health care
     6  providers' representative shall also submit to the commissioner for  the
     7  commissioner's approval a report identifying the proposed subject matter
     8  of  the  negotiations  or  discussions with the health care plan and the
     9  efficiencies or benefits expected to be  achieved  through  the  negoti-
    10  ations  for  both  the  providers  and consumers of health services. The
    11  commissioner shall not  approve  the  report  if  the  commissioner,  in
    12  consultation  with  the superintendent of financial services, determines
    13  that the proposed negotiations would exceed the authority granted  under
    14  this title.
    15    3.  The  representative shall supplement the information in the report
    16  on a regular basis or as new information becomes  available,  indicating
    17  that  the  subject  matter of the negotiations with the health care plan
    18  has changed or will change. In no event shall the report  be  less  than
    19  every thirty days.
    20    4.  With  the  advice of the superintendent of financial services, the
    21  commissioner shall approve or disapprove the report not later  than  the
    22  twentieth  day  after  the  date on which the report is filed. If disap-
    23  proved, the commissioner shall furnish  a  written  explanation  of  any
    24  deficiencies,  along with a statement of specific proposals for remedial
    25  measures to cure the deficiencies. If the commissioner does not  so  act
    26  within the twenty days, the report shall be deemed approved.
    27    5.  A person who acts as a health care providers' representative with-
    28  out the approval of the commissioner under this section shall be  deemed
    29  to be acting outside the authority granted under this title.
    30    6.  Before  reporting  the  results of negotiations with a health care
    31  plan or providing to the affected health care providers an evaluation of
    32  any offer made by a health care plan, the health care providers'  repre-
    33  sentative shall furnish for approval by the commissioner, before dissem-
    34  ination to the health care providers, a copy of all communications to be
    35  made  to the health care providers related to negotiations, discussions,
    36  and offers made by the health care plan.
    37    7. A health care providers' representative   shall report the  end  of
    38  negotiations to the commissioner not later than the fourteenth day after
    39  the date of a health care plan decision declining negotiation, canceling
    40  negotiations,  or  failing  to respond to a request for negotiation.  In
    41  such instances, a health  care  providers'  representative  may  request
    42  intervention  from  the  commissioner to require the health care plan to
    43  participate in the negotiation pursuant to  subdivision  eight  of  this
    44  section.
    45    8. (a) In the event the commissioner determines that an impasse exists
    46  in  the  negotiations,  or  in  the event a health care plan declines to
    47  negotiate, cancels negotiations or fails to respond  to  a  request  for
    48  negotiation, the commissioner shall render assistance as follows:
    49    (1)  to  assist  the  parties  to effect a voluntary resolution of the
    50  negotiations, the commissioner shall appoint a mediator from a  list  of
    51  qualified  persons  maintained  by  the commissioner. If the mediator is
    52  successful in resolving the impasse, then  the  health  care  providers'
    53  representative shall proceed as set forth in this article;
    54    (2)  if  an  impasse continues, the commissioner shall appoint a fact-
    55  finding board of not more than three members from a  list  of  qualified
    56  persons  maintained  by the commissioner, which fact-finding board shall

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     1  have, in addition to the powers delegated to it by the board, the  power
     2  to make recommendations for the resolution of the dispute;
     3    (b) The fact-finding board, acting by a majority of its members, shall
     4  transmit  its findings of fact and recommendations for resolution of the
     5  dispute to the commissioner, and may thereafter assist  the  parties  to
     6  effect  a  voluntary  resolution  of the dispute. The fact-finding board
     7  shall also share its findings  of  fact  and  recommendations  with  the
     8  health care providers' representative and the health care plan. If with-
     9  in  twenty  days after the submission of the findings of fact and recom-
    10  mendations, the impasse continues, the commissioner shall order a resol-
    11  ution  to  the  negotiations  based  upon  the  findings  of  fact   and
    12  recommendations submitted by the fact-finding board.
    13    9.  Any  proposed agreement between health care providers and a health
    14  care plan negotiated pursuant to this title shall be  submitted  to  the
    15  commissioner  for  final  approval.  The  commissioner  shall approve or
    16  disapprove the agreement within sixty days  of  such  submission.    The
    17  commissioner,  after  consultation  with the superintendent of financial
    18  services shall disapprove the agreement if he  or  she  finds  that  the
    19  agreement  would  result in a significant increase in costs to the Medi-
    20  caid managed care program pursuant to section three hundred sixty-four-j
    21  of the social services law, the family health plus program  pursuant  to
    22  section  three  hundred sixty-nine-gg of the social services law, or the
    23  child health plus program pursuant to section twenty-five hundred eleven
    24  of this chapter.
    25    10. The commissioner may collect information from  the  department  of
    26  financial  services and other persons to assist in evaluating the impact
    27  of the proposed arrangement on the health care marketplace. The  commis-
    28  sioner  shall  collect information from health plan companies and health
    29  care providers operating in the same geographic area as the health  care
    30  cooperative.
    31    §  4925.  Certain  collective  action prohibited. 1. This title is not
    32  intended to authorize competing health care providers to act in  concert
    33  in  response  to a report issued by the health care providers' represen-
    34  tative related to the representative's discussions or negotiations  with
    35  health care plans.
    36    2. No health care providers' representative shall negotiate any agree-
    37  ment  that  excludes,  limits  the participation or reimbursement of, or
    38  otherwise limits the scope of services to be provided by any health care
    39  provider or group of health care providers with respect to the  perform-
    40  ance  of  services  that  are within the health care provider's scope of
    41  practice, license, registration, or certificate.
    42    § 4926. Fees. Each person who acts as the representative or  negotiat-
    43  ing parties under this title shall pay to the department a fee to act as
    44  a  representative.  The commissioner, by rule, shall set fees in amounts
    45  deemed reasonable and necessary to  cover  the  costs  incurred  by  the
    46  department  in  administering  this  title. Any fee collected under this
    47  section shall be deposited in the state treasury to the  credit  of  the
    48  general  fund/state  operations  for  the  New  York state department of
    49  health fund.
    50    § 4927. Monitoring of  agreements.  The  commissioner  shall  actively
    51  monitor  agreements  approved under this title to ensure that the agree-
    52  ment remains  in  compliance  with  the  conditions  of  approval.  Upon
    53  request, a health care plan or health care provider shall provide infor-
    54  mation  regarding  compliance.  The  commissioner may revoke an approval
    55  upon a finding that the agreement is not in substantial compliance  with
    56  the terms of the application or the conditions of approval.

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     1    § 4928. Confidentiality. All reports and other information required to
     2  be  reported  to  the  department under this title including information
     3  obtained by the commissioner pursuant  to  subdivision  ten  of  section
     4  forty-nine  hundred  twenty-four  of  this title shall not be subject to
     5  disclosure under article six of the public officers law or article thir-
     6  ty-one of the civil practice law and rules.
     7    §  4929.  Severability  and construction. The provisions of this title
     8  shall be severable, and if any court of competent jurisdiction  declares
     9  any  phrase,  clause, sentence or provision of this title to be invalid,
    10  or its applicability to any government, agency, person  or  circumstance
    11  is declared invalid, the remainder of this title and its relevant appli-
    12  cability  shall  not  be affected. The provisions of this title shall be
    13  liberally construed to give effect to the purposes thereof.
    14    § 4. The department of health, in consultation with the department  of
    15  financial  services,  shall prepare or shall arrange for the preparation
    16  of a report on  the  implementation  of  the  demonstration  program  on
    17  collective  negotiation.  The report shall be submitted to the governor,
    18  the speaker of the assembly, the temporary president of the  senate  and
    19  the chairs of the senate and assembly health and insurance committees at
    20  least  four months prior to the expiration of this act. The report shall
    21  review the extent to which collective negotiations were conducted in the
    22  demonstration service area and shall examine whether and the  extent  to
    23  which  collective  negotiation contributed to the improvement of quality
    24  of care for patients,  enhanced  access  to  medically  necessary  care,
    25  reduced  unnecessary  health care expenditures, and was otherwise in the
    26  public interest. The  report  may  make  recommendations  regarding  the
    27  extension,  alteration and/or expansion of these provisions and make any
    28  other recommendations related to the implementation of collective  nego-
    29  tiation pursuant to this act.
    30    § 5. This act shall take effect on the one hundred twentieth day after
    31  it shall have become a law and shall expire and be deemed repealed three
    32  years after it shall take effect. Effective immediately, the commission-
    33  er  of  health  is  authorized to promulgate any and all rules and regu-
    34  lations and take any other measures necessary to implement this  act  on
    35  its effective date on or before such date.
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