NEW YORK STATE ASSEMBLY MEMORANDUM IN SUPPORT OF LEGISLATION submitted in accordance with Assembly Rule III, Sec 1(f)
BILL NUMBER: A3816
SPONSOR: Rosenthal L (MS) TITLE OF BILL:
An act to amend the public health law and the insurance law, in relation
to requiring health care insurers to offer coverage for health care
provided by out-of-network providers
PURPOSE:
Ensures consumer choice by providing for continued access to out-of-net-
work insurance coverage.
SUMMARY OF SPECIFIC PROVISIONS:
This bill amends Public Health Law § 4403 and Insurance Law §§ 3217-e
and 4306-d to require that every insurer offer, both inside and outside
of the exchange, out-of-network coverage in at least one policy option
and as an optional rider. It provides an effective date of January next
succeeding the date of enactment.
JUSTIFICATION:
Across the state, individuals accessing insurance through the statewide
health benefit exchange, "the New York State of Health," and outside of
the exchange are finding plans no longer include out-of-network cover-
age. Citing concerns of keeping plan costs affordable and predictable,
the New York State of Health did not require plans sold on the exchange
offer out-of-network coverage. Rather, in establishing the New York
State of Health, the only condition regulators imposed on insurers
regarding out-of-network coverage was the requirement that if they offer
out-of-network coverage to individuals purchasing insurance directly,
they must also offer it through the exchange. While the Department of
Health had indicated that the 2015 exchange invitation would include a
requirement for out-of-network benefits, the final invitation did not
include such requirement. Instead the 2015 invitation continued the
requirement that if the applicant offered an out-of-network product
outside of the exchange, it must also offer such within the exchange at
platinum and silver levels. Further, the invitation encouraged insurers
to offer such products within the exchange if they do not offer such
outside of the exchange.
As insurance carriers put into effect cost saving measures, coverage the
Affordable Care Act does not mandate, such as out-of-network coverage,
is being eliminated. Insurers across the state faced concerns that
competitors would not offer out-of-network coverage, leaving them to
attract the sickest, most costly patients if they did offer this cover-
age. The result has been most insurers chose to eliminate the out-of-
network option in all their plans marketed to individuals. This coverage
remains an option in a handful of counties in the state.
This situation is compounded by recent reports that the plans being
offered on the exchange have very limited networks. The Wall Street
Journal reported results of a McKinsey report which looked at federal
and state-run exchanges in 20 cities, finding that 60% of health plans
offered coverage at fewer hospitals compared to current individual
plans. Narrow networks restrict access and further illustrate the need
for an out-of-network coverage option.
While the 2014-15 Budget did include monumental changes protecting
consumers from surprise medical bills resulting from out-of-network
care, those provisions did not address access to out-of-network coverage
in the individual market. While policies containing out-of-network
coverage will likely cost more than those that do not provide this
coverage, for individuals facing certain illnesses or having specific
health care needs, this is affordable and necessary option that must be
made available. Additionally, for individuals who previously sought care
by a particular provider no longer included within their network, this
added option may be well worth the extra expense. By requiring insurers
to provide out-of-network coverage as an option, this legislation will
provide and protect consumer choice, and ensure patients can maintain
access to the provider of their choice.
LEGISLATIVE HISTORY:
2021-22: A.1151 - Referred to Insurance
2019-20: A.598 - Referred to Insurance; S.3461 - Referred to Health
2017-18: A.7671 - Referred to Insurance; S.5675 - Referred to Health
FISCAL IMPLICATIONS:
None to the State.
EFFECTIVE DATE:
The first of January next succeeding the date on which it shall become
law, and shall apply to contracts and policies issued, renewed, modified
or amended on or after such date.
STATE OF NEW YORK
________________________________________________________________________
3816
2023-2024 Regular Sessions
IN ASSEMBLY
February 8, 2023
___________
Introduced by M. of A. L. ROSENTHAL, STECK, FAHY, JEAN-PIERRE, HEVESI,
TAYLOR -- Multi-Sponsored by -- M. of A. EPSTEIN, SIMON -- read once
and referred to the Committee on Insurance
AN ACT to amend the public health law and the insurance law, in relation
to requiring health care insurers to offer coverage for health care
provided by out-of-network providers
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. Section 4403 of the public health law is amended by adding
2 a new subdivision 10 to read as follows:
3 10. Every health maintenance organization shall offer out-of-network
4 coverage as an optional rider to any contract and shall offer at least
5 one contract option that includes out-of-network coverage. These options
6 shall be made available both within the statewide health benefit
7 exchange and outside of the health benefit exchange.
8 § 2. Section 3217-e of the insurance law, as added by chapter 219 of
9 the laws of 2011, is amended to read as follows:
10 § 3217-e. Choice of health care provider. (a) An insurer that is
11 subject to this article and requires or provides for designation by an
12 insured of a participating primary care provider shall permit the
13 insured to designate any participating primary care provider who is
14 available to accept such individual, and in the case of a child, shall
15 permit the insured to designate a physician (allopathic or osteopathic)
16 who specializes in pediatrics as the child's primary care provider if
17 such provider participates in the network of the insurer.
18 (b) Every insurer that offers health insurance and is subject to the
19 provisions of this article, shall offer out-of-network coverage as an
20 optional rider to any policy and shall offer at least one policy option
21 that includes out-of-network coverage. These options shall be made
22 available both within the statewide health benefit exchange and outside
23 of the health benefit exchange.
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD08809-01-3
A. 3816 2
1 § 3. Section 4306-d of the insurance law, as added by chapter 219 of
2 the laws of 2011, is amended to read as follows:
3 § 4306-d. Choice of health care provider. (a) A corporation that is
4 subject to the provisions of this article and requires or provides for
5 designation by a subscriber of a participating primary care provider
6 shall permit the subscriber to designate any participating primary care
7 provider who is available to accept such individual, and in the case of
8 a child, shall permit the subscriber to designate a physician (allopath-
9 ic or osteopathic) who specializes in pediatrics as the child's primary
10 care provider if such provider participates in the network of the corpo-
11 ration.
12 (b) Every corporation that is subject to the provisions of this arti-
13 cle, shall offer out-of-network coverage as an optional rider to any
14 contract and shall offer at least one contract option that includes
15 out-of-network coverage. These options shall be made available both
16 within the statewide health benefit exchange and outside of the health
17 benefit exchange.
18 § 4. This act shall take effect on the first of January next succeed-
19 ing the date on which it shall have become a law, and shall apply to
20 contracts and policies issued, renewed, modified or amended on or after
21 such date.
