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A05692 Summary:

SPONSORGottfried (MS)
COSPNSRCahill, Colton, Magnarelli, Galef, Paulin, Schimel, Lifton, Cusick, O'Donnell, Jaffee, Weisenberg, Perry, Russell, Markey, Bronson, Rosenthal, Kellner, Lavine, Thiele, Benedetto, Titone, Peoples-Stokes, Gunther, Weprin, Abinanti, Englebright, Roberts, Brook-Krasny, Robinson, Skoufis, Otis, Aubry, Wright
MLTSPNSRAbbate, Arroyo, Brennan, Buchwald, Cook, Cymbrowitz, Dinowitz, Fahy, Glick, Heastie, Hikind, Hooper, Jacobs, Lentol, Lupardo, Magee, Malliotakis, McDonald, Millman, Montesano, Moya, Ortiz, Pretlow, Raia, Scarborough, Sepulveda, Sweeney, Weinstein
Add Art 49 Title III SS4920 - 4929, Pub Health L
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.
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A05692 Text:

                STATE OF NEW YORK
                               2013-2014 Regular Sessions
                   IN ASSEMBLY
                                      March 5, 2013
        Introduced  by  M.  of  A. GOTTFRIED, CAHILL, COLTON, MAGNARELLI, GALEF,

          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
          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 system of collective  action  on  behalf  of  health  care
     9  providers. Consequently, the legislature finds it appropriate and neces-
    10  sary  to  displace  competition  with regulation of health plan-provider
    11  agreements and authorize collective negotiations on the terms and condi-
    12  tions of the relationship between health  care  plans  and  health  care
    13  providers  so  the imbalances between the two will not result in adverse
    14  conditions of health care. This act is  not  intended  to  apply  to  or
    15  affect  in  any  respect collective bargaining relationships which arise

    16  under applicable federal or state collective bargaining statutes.
         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.

        A. 5692                             2
     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
     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, including but not limited to:

    22    (a)  a  health  maintenance  organization licensed pursuant to article
    23  forty-three of the  insurance  law  or  certified  pursuant  to  article
    24  forty-four of this chapter;
    25    (b) any other organization certified pursuant to article forty-four of
    26  this chapter; or
    27    (c) an insurer or corporation subject to the insurance law.
    28    2.  "Person"  means  an  individual,  association, corporation, or any
    29  other legal entity.
    30    3. "Health care providers' representative" means a third party who  is
    31  authorized  by  health  care providers to negotiate on their behalf with
    32  health care plans over contractual terms and conditions affecting  those
    33  health care providers.

    34    4. "Strike" means a work stoppage in part or in whole, direct or indi-
    35  rect, by a health care provider or health care providers to gain compli-
    36  ance with demands made on a health care plan.
    37    5.  "Substantial  market  share in a business line" exists if a health
    38  care plan's market share of a business line within the  geographic  area
    39  for  which a negotiation has been approved by the commissioner, alone or
    40  in combination with the market shares of affiliates, exceeds either  ten
    41  percent  of  the  total number of covered lives in that service area for
    42  such business line or twenty-five thousand lives, or if the commissioner
    43  determines the market share of the insurer  in  the  relevant  insurance

    44  product and geographic markets for the services of the providers seeking
    45  to  collectively  negotiate  significantly  exceeds  the  countervailing
    46  market share of the providers acting individually.
    47    6. "Health care provider" means a person who is  licensed,  certified,
    48  or registered pursuant to title eight of the education law and who prac-
    49  tices  as a health care provider as an independent contractor and/or who
    50  is an owner, officer,  shareholder,  or  proprietor  of  a  health  care
    51  provider.  A health care provider under title eight of the education law
    52  who practices as an employee of a health  care  provider  shall  not  be
    53  deemed a health care provider for purposes of this title.

    54    §  4921.  Non-fee related collective negotiation authorized. 1. Health
    55  care providers practicing within the geographic area for which a negoti-
    56  ation has been approved by the commissioner may meet and communicate for

        A. 5692                             3
     1  the purpose of collectively negotiating the following terms  and  condi-
     2  tions of provider contracts with the health care plan:
     3    (a)  the details of the utilization review plan as defined pursuant to
     4  subdivision ten of  section  forty-nine  hundred  of  this  article  and
     5  subsection  (j)  of  section four thousand nine hundred of the insurance
     6  law;
     7    (b) coverage  provisions;  health  care  benefits;  benefit  maximums,

     8  including benefit limitations; and exclusions of coverage;
     9    (c) the definition of medical necessity;
    10    (d)  the  clinical  practice guidelines used to make medical necessity
    11  and utilization review determinations;
    12    (e) preventive care and other medical management practices;
    13    (f) drug formularies and  standards  and  procedures  for  prescribing
    14  off-formulary drugs;
    15    (g) respective physician liability for the treatment or lack of treat-
    16  ment of covered persons;
    17    (h)  the  details  of health care plan risk transfer arrangements with
    18  providers;
    19    (i) plan administrative procedures, including methods  and  timing  of
    20  health care provider payment for services;

    21    (j)  procedures  to be utilized to resolve disputes between the health
    22  care plan and health care providers;
    23    (k) patient referral procedures including, but not limited  to,  those
    24  applicable to out-of-network referrals;
    25    (l) the formulation and application of health care provider reimburse-
    26  ment procedures;
    27    (m) quality assurance programs;
    28    (n)  the  process  for  rendering  utilization  review  determinations
    29  including: establishment of a process for rendering  utilization  review
    30  determinations which shall, at a minimum, include: written procedures to
    31  assure  that utilization reviews and determinations are conducted within
    32  the timeframes established in this  article;  procedures  to  notify  an

    33  enrollee,  an  enrollee's  designee  and/or  an  enrollee's  health care
    34  provider of adverse determinations; and procedures for appeal of adverse
    35  determinations, including the  establishment  of  an  expedited  appeals
    36  process  for denials of continued inpatient care or where there is immi-
    37  nent or serious threat to the health of the enrollee; and
    38    (o) health care provider selection and termination  criteria  used  by
    39  the health care plan.
    40    2. Nothing in this section shall be construed to allow or authorize an
    41  alteration  of  the terms of the internal and external review procedures
    42  set forth in law.
    43    3. Nothing in this section shall be construed to allow a strike  of  a

    44  health  care  plan  by  health  care providers or plans as otherwise set
    45  forth in the laws of this state.
    46    4. Nothing in this section shall be construed to  allow  or  authorize
    47  terms or conditions which would impede the ability of a health care plan
    48  to  obtain or retain accreditation by the national committee for quality
    49  assurance or a similar body.
    50    § 4922. Fee related collective negotiation. 1. If the health care plan
    51  has substantial market share in a business line in any  geographic  area
    52  for  which  a  negotiation has been approved by the commissioner, health
    53  care providers practicing within that geographic area  may  collectively
    54  negotiate  the  following terms and conditions relating to that business

    55  line with the health care plan:

        A. 5692                             4
     1    (a) the fees assessed by the health care plan for services,  including
     2  fees established through the application of reimbursement procedures;
     3    (b)  the  conversion  factors  used  by  the  health  care  plan  in a
     4  resource-based relative value scale reimbursement methodology  or  other
     5  similar  methodology; provided the same are not otherwise established by
     6  state or federal law or regulation;
     7    (c) the amount of any discount granted by the health care plan on  the
     8  fee of health care services to be rendered by health care providers;
     9    (d)  the  dollar  amount  of  capitation  or  fixed payment for health

    10  services rendered by health care providers to health  care  plan  enrol-
    11  lees;
    12    (e)  the  procedure code or other description of a health care service
    13  covered by a payment and  the  appropriate  grouping  of  the  procedure
    14  codes; or
    15    (f) the amount of any other component of the reimbursement methodology
    16  for a health care service.
    17    2.  Nothing  herein  shall be deemed to affect or limit the right of a
    18  health care provider or group of health care providers  to  collectively
    19  petition a government entity for a change in a law, rule, or regulation.
    20    § 4923. Collective negotiation requirements. 1. Collective negotiation
    21  rights granted by this title must conform to the following requirements:

    22    (a)  health  care  providers  may  communicate  with other health care
    23  providers regarding the contractual terms and conditions to  be  negoti-
    24  ated with a health care plan;
    25    (b)  health care providers may communicate with health care providers'
    26  representatives;
    27    (c) a health care providers' representative is the only party  author-
    28  ized  to  negotiate  with health care plans on behalf of the health care
    29  providers as a group;
    30    (d) a health care provider can be bound by the  terms  and  conditions
    31  negotiated by the health care providers' representatives; and
    32    (e)  in  communicating  or negotiating with the health care providers'
    33  representative, a health care plan is entitled to contract with or offer

    34  different contract terms and conditions to individual  competing  health
    35  care providers.
    36    2. A health care providers' representative may not represent more than
    37  thirty percent of the market of health care providers or of a particular
    38  health care provider type or specialty practicing in the geographic area
    39  for  which  a  negotiation  has been approved by the commissioner if the
    40  health care plan covers less than five percent of the actual  number  of
    41  covered  lives of the health care plan in the area, as determined by the
    42  department.
    43    3. Nothing in this section shall be construed to  prohibit  collective
    44  action  on  the  part  of  any health care provider who is a member of a

    45  collective bargaining unit recognized pursuant  to  the  national  labor
    46  relations act.
    47    §  4924.  Requirements  for  health care providers' representative. 1.
    48  Before engaging in collective negotiations with a health  care  plan  on
    49  behalf of health care providers, a health care providers' representative
    50  shall  file  with  the  commissioner,  in  the  manner prescribed by the
    51  commissioner, information identifying the representative, the  represen-
    52  tative's  plan  of  operation,  and  the  representative's procedures to
    53  ensure compliance with this title.
    54    2. Before engaging in the collective  negotiations,  the  health  care
    55  providers'  representative shall also submit to the commissioner for the

    56  commissioner's approval a report identifying the proposed subject matter

        A. 5692                             5
     1  of the negotiations or discussions with the health  care  plan  and  the
     2  efficiencies  or  benefits  expected  to be achieved through the negoti-
     3  ations for both the providers and  consumers  of  health  services.  The
     4  commissioner  shall  not  approve  the  report  if  the commissioner, in
     5  consultation with the superintendent of  financial  services  determines
     6  that  the proposed negotiations would exceed the authority granted under
     7  this title.
     8    3. The representative shall supplement the information in  the  report
     9  on  a  regular basis or as new information becomes available, indicating

    10  that the subject matter of the negotiations with the  health  care  plan
    11  has  changed  or  will change. In no event shall the report be less than
    12  every thirty days.
    13    4. With the advice of the superintendent of financial services and the
    14  attorney general, the  commissioner  shall  approve  or  disapprove  the
    15  report  not  later  than  the  twentieth day after the date on which the
    16  report is filed. If disapproved, the commissioner shall furnish a  writ-
    17  ten  explanation of any deficiencies, along with a statement of specific
    18  proposals for remedial measures to cure the deficiencies. If the commis-
    19  sioner does not so act within the  twenty  days,  the  report  shall  be
    20  deemed approved.

    21    5.  A person who acts as a health care providers' representative with-
    22  out the approval of the commissioner under this section shall be  deemed
    23  to be acting outside the authority granted under this title.
    24    6.  Before  reporting  the  results of negotiations with a health care
    25  plan or providing to the affected health care providers an evaluation of
    26  any offer made by a health care plan, the health care providers'  repre-
    27  sentative shall furnish for approval by the commissioner, before dissem-
    28  ination to the health care providers, a copy of all communications to be
    29  made  to the health care providers related to negotiations, discussions,
    30  and offers made by the health care plan.

    31    7. A health care providers' representative   shall report the  end  of
    32  negotiations to the commissioner not later than the fourteenth day after
    33  the date of a health care plan decision declining negotiation, canceling
    34  negotiations,  or  failing  to respond to a request for negotiation.  In
    35  such instances, a health  care  providers'  representative  may  request
    36  intervention  from  the  commissioner to require the health care plan to
    37  participate in the negotiation pursuant to  subdivision  eight  of  this
    38  section.
    39    8. (a) In the event the commissioner determines that an impasse exists
    40  in  the  negotiations,  or  in  the event a health care plan declines to
    41  negotiate, cancels negotiations or fails to respond  to  a  request  for

    42  negotiation, the commissioner shall render assistance as follows:
    43    (1)  to  assist  the  parties  to effect a voluntary resolution of the
    44  negotiations, the commissioner shall appoint a mediator from a  list  of
    45  qualified  persons  maintained  by  the commissioner. If the mediator is
    46  successful in resolving the impasse, then  the  health  care  providers'
    47  representative shall proceed as set forth in this article;
    48    (2)  if  an  impasse continues, the commissioner shall appoint a fact-
    49  finding board of not more than three members from a  list  of  qualified
    50  persons  maintained  by the commissioner, which fact-finding board shall
    51  have, in addition to the powers delegated to it by the board, the  power

    52  to make recommendations for the resolution of the dispute;
    53    (b) The fact-finding board, acting by a majority of its members, shall
    54  transmit  its findings of fact and recommendations for resolution of the
    55  dispute to the commissioner, and may thereafter assist  the  parties  to
    56  effect  a  voluntary  resolution  of the dispute. The fact-finding board

        A. 5692                             6
     1  shall also share its findings  of  fact  and  recommendations  with  the
     2  health care providers' representative and the health care plan. If with-
     3  in  twenty  days after the submission of the findings of fact and recom-
     4  mendations, the impasse continues, the commissioner shall order a resol-

     5  ution   to  the  negotiations  based  upon  the  findings  of  fact  and
     6  recommendations submitted by the fact-finding board.
     7    9. Any proposed agreement between health care providers and  a  health
     8  care  plan  negotiated  pursuant to this title shall be submitted to the
     9  commissioner for final  approval.  The  commissioner  shall  approve  or
    10  disapprove the agreement within sixty days of such submission.
    11    10.  The  commissioner  may  collect information from other persons to
    12  assist in evaluating the impact  of  the  proposed  arrangement  on  the
    13  health care marketplace. The commissioner shall collect information from
    14  health  plan  companies  and health care providers operating in the same
    15  geographic area.

    16    § 4925. Certain collective action prohibited. 1.  This  title  is  not
    17  intended  to authorize competing health care providers to act in concert
    18  in response to a report issued by the health care  providers'  represen-
    19  tative  related to the representative's discussions or negotiations with
    20  health care plans.
    21    2. No health care providers' representative shall negotiate any agree-
    22  ment that excludes, limits the participation  or  reimbursement  of,  or
    23  otherwise limits the scope of services to be provided by any health care
    24  provider  or group of health care providers with respect to the perform-
    25  ance of services that are within the health  care  provider's  scope  of
    26  practice, license, registration, or certificate.

    27    §  4926. Fees. Each person who acts as the representative or negotiat-
    28  ing parties under this title shall pay to the department a fee to act as
    29  a representative. The commissioner, by rule, shall set fees  in  amounts
    30  deemed  reasonable  and  necessary  to  cover  the costs incurred by the
    31  department in administering this title. Any  fee  collected  under  this
    32  section  shall  be  deposited in the state treasury to the credit of the
    33  general fund/state operations - 003 for the New York state department of
    34  health fund.
    35    § 4927. Monitoring of  agreements.  The  commissioner  shall  actively
    36  monitor  agreements  approved under this title to ensure that the agree-
    37  ment remains  in  compliance  with  the  conditions  of  approval.  Upon

    38  request, a health care plan or health care provider shall provide infor-
    39  mation  regarding  compliance.  The  commissioner may revoke an approval
    40  upon a finding that the agreement is not in substantial compliance  with
    41  the terms of the application or the conditions of approval.
    42    § 4928. Confidentiality. All reports and other information required to
    43  be reported to the department of law under this title including informa-
    44  tion obtained by the commissioner pursuant to subdivision ten of section
    45  forty-nine  hundred  twenty-four  of  this title shall not be subject to
    46  disclosure under article six of the public officers law or article thir-
    47  ty-one of the civil practice law and rules.

    48    § 4929. Severability and construction. The provisions  of  this  title
    49  shall  be severable, and if any court of competent jurisdiction declares
    50  any phrase, clause, sentence or provision of this title to  be  invalid,
    51  or  its  applicability to any government, agency, person or circumstance
    52  is declared invalid, the remainder of this title and its relevant appli-
    53  cability shall not be affected. The provisions of this  title  shall  be
    54  liberally construed to give effect to the purposes thereof.
    55    § 4. This act shall take effect on the one hundred twentieth day after
    56  it  shall have become a law; provided that the commissioner of health is

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     1  authorized to promulgate any and all rules and regulations and take  any

     2  other  measures necessary to implement this act on its effective date on
     3  or before such date.
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