A02356 Summary:

BILL NO    A02356 

SAME AS    Same as S 2370

SPONSOR    Gottfried (MS)

COSPNSR    John, Brennan, Gantt, Jacobs, Hikind, Paulin, Dinowitz, Bing,
           Peoples-Stokes, Schroeder, Rosenthal, Titus, Magnarelli, Jaffee

MLTSPNSR   Abbate, Alessi, Alfano, Aubry, Benedetto, Benjamin, Boyland, Bradley,
           Brodsky, Brook-Krasny, Cahill, Camara, Christensen, Clark, Colton,
           Cook, Cymbrowitz, Eddington, Englebright, Espaillat, Farrell, Fields,
           Glick, Gordon, Gunther, Heastie, Hooper, Hoyt, Hyer-Spencer, Kellner,
           Koon, Lavine, Lentol, Lifton, Lopez V, Lupardo, Magee, Maisel,
           Markey, Mayersohn, McEneny, Millman, Ortiz, Peralta, Perry, Pheffer,
           Powell, Pretlow, Ramos, Reilly, Rivera J, Rivera N, Rivera P,
           Robinson, Scarborough, Schimel, Stirpe, Sweeney, Thiele, Towns,
           Walker, Weisenberg, Weprin, Wright

Ren Art 50 SS5000 - 5003 to be Art 80 SS8000 - 8003, add Art 51 SS5100 - 5110,
Pub Health L; add S89-h, St Fin L; add Art 35 SS1650 - 1652, Tax L

Enacts the New York State Health Plan, a comprehensive system of access to
health insurance for New York state residents: provides for administrative
structure of the plan, including its status as a public benefit corporation;
provides for powers and duties of the governing board, the scope of benefits,
payment mechanisms and cost controls; establishes the New York Health Trust
Fund which would hold monies from a variety of sources to be used solely to
finance the plan; establishes a mechanism to collect plan premium payments (an
8% employer premium and a 2% employee payroll premium, which may be paid by an
employer, plus a 9% premium payment on self-employment income); establishes a
temporary commission on implementation of the plan and makes a $500,000
appropriation therefor; and directs the superintendent of insurance to examine
the premium rate structure for insurance underwritten in the state and to
identify that portion of premiums which are attributable to health care
expenditures due to implementation of the plan.

A02356 Actions:

BILL NO    A02356 

01/15/2009 referred to health

A02356 Votes:

A02356 Memo:

 BILL NUMBER:  A2356

 TITLE OF BILL :  An act to amend the public health law, the state
finance law and the tax law, in relation to the establishment of the
New York health plan and making an appropriation to the temporary
commission on implementation of the New York health plan and providing
for the repeal of certain provisions upon expiration thereof

 PURPOSE OR GENERAL IDEA OF BILL :

To establish a comprehensive system of universal access to health
insurance by all residents of New York State, access to and choice of
health care providers, controls on health care costs, development of
health care services, and a mechanism for financing of the program.

 SUMMARY OF SPECIFIC PROVISIONS :

Section 1 amends the Public Health Law by adding a new Article 51
establishing the New York Health Plan. Article 51 sets forth the
administrative structure of the New York Health Plan (including its
establishment as an independent public benefit corporation), the
powers and duties of the governing board, the scope of benefits,
payment mechanisms and cost controls.

Key features of New York Health include the following:

Benefits

Benefits would include medically necessary health services including
preventive and primary care, hospital care, dental, eye care,
prescription drugs, mental health, treatment for drug and alcohol
addictions, and rehabilitative care;

Coverage

Coverage would be extended to residents of New York State without
regard to age, income, health or employment status;

Payment

Payment for provider services would be on the basis of global budgets
for hospitals and other institutional providers, individual
practitioners would be able to choose fee-for-service, capitation or
be salaried by a global budget institution. There would be no
out-of-pocket charges for individuals, and no balance billing;

Administration

Administration of the plan, as an independent public benefit
corporation, would be by an 18-member Board of Governors, appointed by
the Governor and confirmed by the Senate. The Board would be
representative of consumers and providers of health care services, as
well as labor and business;

Financing

Financing of the program would be through several sources. Current
federal, state and local expenditures for health care services -
primarily through Medicare and Medicaid - would be incorporated into
the New York Health Plan. Employers and employees, persons who are
self employed and those with high investment incomes would pay a
uniform New York Health Plan premium. In addition, as much as $5
billion in administrative over-head - under our current method of
providing health insurance would be eliminated, redirecting dollars to
broadened coverage under the plan.

Section 2 amends the State Finance Law by adding a new section 97-00
establishing the New York Health Trust Fund. Monies in the fund would
be used to finance the New York Health Plan. Sources include: federal,
state and local expenditures for the Medicare and Medicaid programs;
premium payment revenues paid by employers and employees; funds
previously appropriated for services that would now be covered by the
New York Health Plan. Monies in the fund would be solely for the
purposes of New York Health, and would not be subject to
appropriation.

Section 3 amends the Tax Law by adding a new Article 35 establishing a
mechanism to collect New York Health Plan premium payments. An 8%
employer and 2% employee payroll premium (the employer may pay the
employee's share), and a 9% premium payment on self-employment income
would be established. Premium payments would also be levied on
unearned income in instances where such income exceeds 50% of an
individual's total income, additional revenues include premium
payments by out-of-state employers. Persons eligible for Medicare
benefits would be exempt from payment of the premium on unearned
income.

Section 4 establishes a temporary commission on implementation of New
York Health to examine New York statutes and make recommendations to
conform state statute to the provisions of New York Health. The
commission would be jointly appointed by the Governor and the
Legislature.

Section 5 directs the Superintendent of Insurance, in consultation
with a technical advisory committee, to examine the premium rate
structure for insurance underwritten in the state and to identify that
portion of premiums which are attributable to health care expenditures
due to implementation of New York Health.

Section 6 appropriates $500,000 to the temporary commission on
implementation of New York Health.

Section 7 provides for an effective date on the first day of January
following enactment into law, and also establishes the following
timetable for implementation:

-- by February 28 the Governor shall make the initial appointments to
th New York Health Board of Governors;

-- by March 31, the Commissioner of Health is directed to apply for
necessary federal waivers to allow for the participation of Medicare
and Medicaid in the New York Health Plan;

-- by December 31 the Board of Governors and the Commissioner of
Health shall develop a procedure for the deposit of Medicare and
Medicaid funds into the New York Health Trust Fund;

-- on January 1 premium payments and New York Health Plan benefits
would begin.

 JUSTIFICATION :

Today, New Yorkers spend an exorbitant amount of money for a patchwork
of health coverage programs that fails to cover millions of
individuals, fails to provide needed services, and fails to control
costs. Huge and growing amounts are spent on paperwork and
administration, rather than health care services. New York Health
offers an opportunity to provide quality health care coverage to all
New Yorkers, while also containing increases in medical costs.

Over 3 million New Yorkers lack health insurance coverage while
another 3 million are underinsured. In addition, more and more New
Yorkers are confronted with the choice of maintaining coverage in the
face of rising out-of-pocket expenses, mounting costs and health
insurance premiums, or going without coverage. In addition, the rise
of managed care has transformed the health care delivery system. The
patient's health care professional's judgments on treatment are
second-guessed by corporate personnel. Only through comprehensive
reform, as that proposed by New York Health, will there be a rebalance
of the health care system to patient needs and the professional
judgments of practitioners. The New York Health Plan seeks to address
the needs of that portion of the population lacking health insurance
coverage, as well as the needs of the growing number of New Yorkers
who are frustrated with the coverage they have. Through establishment
of a uniform and universal benefit plan coverage could be extended to
all New Yorkers while also reducing expenditures and controlling
health care costs.

The New York Health Plan achieves savings through the consolidation of
health care expenditures under a single, publicly financed, insurance
program. Such a program eliminates more than $5 billion in
administrative waste, including excess insurance company
administration and costs of billing and collecting for hospitals,
physicians and other health care providers. It also provides stability
to New York's hospitals, freeing up resources for patient care. The
savings would be used to finance increased health care coverage for
the over 3 million New Yorkers lacking coverage, and the many million
more with inadequate coverage. Funds could thus be targeted for
primary and preventive services, training of health care workers, and
to enable physicians to set up practices in inner city and rural
communities.

 PRIOR LEGISLATIVE HISTORY :

1992: A.8912-A passed Assembly; 1993: A.5900 reported to Ways and
Means; 1994: A.5900 referred to Health Committee; 1995-96: A.6801
reported to Ways and Means; 1997-98: A.6172: reported to Ways and
Means; 1999-00:  A.3571 reported to Ways and Means; 2001-02: A.6779
reported to Ways and Means; 2003-04: A.6952 reported to Ways and
Means; 2005: A.6576 reported to Ways and Means; 2006: A.6576 referred
to Health Committee; 2007-08: A.7354 - reported to Ways and Means

 FISCAL IMPLICATIONS :

No new costs to state and local government. Current governmental
expenditures for the provision of health care services, such as
Medicaid, would be utilized to support coverage under the New York
Health Plan, cost control and quality assurance mechanisms under the
plan will restrain health care cost increases otherwise experienced by
governmental payors. In addition, as an employer, state and local
government like all employers providing health benefits - will realize
a reduction in their expenditures for employer provided health
insurance coverage by paying the lower New York Health Plan premium
payment.

 EFFECTIVE DATE :
The first of January following enactment.