Amd §369-gg, Soc Serv L; rpld & add Art 6 §§601 - 604, Fin Serv L
Relates to the basic health program; permits a person or an eligible small group to purchase coverage from a basic health plan on behalf of an individual and any qualified dependents through the basic health program buy-in as long as the individual and any qualified dependents otherwise meet certain eligibility requirements (Part A); relates to consumer protection from health care costs (Part B).
STATE OF NEW YORK
________________________________________________________________________
8614
2025-2026 Regular Sessions
IN SENATE
December 12, 2025
___________
Introduced by Sen. COONEY -- read twice and ordered printed, and when
printed to be committed to the Committee on Rules
AN ACT to amend the social services law, in relation to the basic health
program (Part A); and to amend the financial services law, in relation
to consumer protection from health care costs; and to repeal certain
provisions of such law relating thereto (Part B)
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. This act enacts into law components of legislation relating
2 to health equity, affordability, and reform. Each component is wholly
3 contained within a Part identified as Parts A through B. The effective
4 date for each particular provision contained within such Part is set
5 forth in the last section of such Part. Any provision in any section
6 contained within a Part, including the effective date of the Part, which
7 makes reference to a section "of this act", when used in connection with
8 that particular component, shall be deemed to mean and refer to the
9 corresponding section of the Part in which it is found. Section three
10 of this act sets forth the general effective date of this act.
11 PART A
12 Section 1. Section 369-gg of the social services law, as added by
13 section 51 of part C of chapter 60 of the laws of 2014, paragraph (c) of
14 subdivision 1 as separately amended by sections 4 of part BBB of chapter
15 56 and part P of chapter 57 of the laws of 2022, paragraph (e) of subdi-
16 vision 1, and subdivisions 5 and 7 as amended by section 2 of part H of
17 chapter 57 of the laws of 2021, subdivision 2 as amended and subdivision
18 9 as added by section 28-a, subdivision 6 as added by section 28 and
19 subdivision 8 as amended by section 46 of part B of chapter 57 of the
20 laws of 2015, paragraph (d) of subdivision 3 as amended by section 2 and
21 paragraph (b) of subdivision 5 as amended by section 7-a of part BBB of
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD14093-01-5
S. 8614 2
1 chapter 56 of the laws of 2022 and paragraph (d) of subdivision 3 as
2 separately amended by chapter 669 of the laws of 2022, is amended to
3 read as follows:
4 § 369-gg. Basic health program. 1. Definitions. For purposes of this
5 section:
6 (a) "Eligible organization" means an insurer licensed pursuant to
7 article thirty-two or forty-two of the insurance law, a corporation or
8 an organization under article forty-three of the insurance law, or an
9 organization certified under article forty-four of the public health
10 law, including providers certified under section forty-four hundred
11 three-e of the public health law;
12 (b) "Approved organization" means an eligible organization approved by
13 the commissioner to underwrite a basic health insurance plan pursuant to
14 this title;
15 (c) "Health care services" means (i) the services and supplies as
16 defined by the commissioner in consultation with the superintendent of
17 financial services, and shall be consistent with and subject to the
18 essential health benefits as defined by the commissioner in accordance
19 with the provisions of the patient protection and affordable care act
20 (P.L. 111-148) and consistent with the benefits provided by the refer-
21 ence plan selected by the commissioner for the purposes of defining such
22 benefits, and shall include coverage of and access to the services of
23 any national cancer institute-designated cancer center licensed by the
24 department of health within the service area of the approved organiza-
25 tion that is willing to agree to provide cancer-related inpatient,
26 outpatient and medical services to all enrollees in approved organiza-
27 tions' plans in such cancer center's service area under the prevailing
28 terms and conditions that the approved organization requires of other
29 similar providers to be included in the approved organization's network,
30 provided that such terms shall include reimbursement of such center at
31 no less than the fee-for-service medicaid payment rate and methodology
32 applicable to the center's inpatient and outpatient services; (ii)
33 dental and vision services as defined by the commissioner, and (iii) as
34 defined by the commissioner and subject to federal approval, certain
35 services and supports provided to enrollees eligible pursuant to subpar-
36 agraph one of paragraph (g) of subdivision one of section three hundred
37 sixty-six of this article who have functional limitations and/or chronic
38 illnesses that have the primary purpose of supporting the ability of the
39 enrollee to live or work in the setting of their choice, which may
40 include the individual's home, a worksite, or a provider-owned or
41 controlled residential setting;
42 (d) "Qualified health plan" means a health plan that meets the crite-
43 ria for certification described in § 1311(c) of the Patient Protection
44 and Affordable Care Act (P.L. 111-148), and is offered to individuals
45 through the health insurance exchange marketplace; [and]
46 (e) "Basic health insurance plan" means a standard health plan provid-
47 ing health care services, separate and apart from qualified health
48 plans, that is issued by an approved organization and certified in
49 accordance with this section[.];
50 (f) "Eligible small group" means any employer, or trustee or trustees
51 of a fund established by an employer, members of a trade association,
52 labor union, fund established or participated in by two or more employ-
53 ers or by one or more labor unions, association, or a trustee or trus-
54 tees of a fund established, created or maintained for the benefit of
55 members of one or more associations, church, or any entity that may be
56 eligible to purchase group coverage under the insurance law, provided
S. 8614 3
1 that any of the foregoing groups identified employ, represent, or cover
2 one hundred or less individuals;
3 (g) "Qualified dependents" mean the spouse, and any dependent children
4 of an individual seeking coverage through the basic health program buy-
5 in; and
6 (h) "Family coverage" means the cost to buy-in to the basic health
7 program for an individual and any qualified dependents based on the per
8 member, per month cost applicable.
9 2. Authorization. If it is in the financial interest of the state to
10 do so, the commissioner of health is authorized, with the approval of
11 the director of the budget, to establish a basic health program. The
12 commissioner's authority pursuant to this section is contingent upon
13 obtaining and maintaining all necessary approvals from the secretary of
14 health and human services to offer a basic health program in accordance
15 with 42 U.S.C. 18051. The commissioner may take any and all actions
16 necessary to obtain such approvals. Notwithstanding the foregoing, with-
17 in ninety days of the effective date of [the] part B of chapter fifty-
18 seven of the laws of two thousand fifteen [which amended this subdivi-
19 sion] the commissioner shall submit a report to the temporary president
20 of the senate and the speaker of the assembly detailing a contingency
21 plan in the event eligibility rules or regulations are modified or
22 repealed; or in the event federal payment is reduced from ninety five
23 percent of the premium tax credits and cost-sharing reductions pursuant
24 to the patient protection and affordable care act (P.L. 111-148). The
25 contingency plan shall be implemented within ninety days of the above
26 stated events or the time period specified in federal law.
27 3. Eligibility. A person is eligible to receive coverage for health
28 care services pursuant to this title if [he or she] such person:
29 (a) resides in New York state and is under sixty-five years of age;
30 (b) is not eligible for medical assistance under title eleven of this
31 article or for the child health insurance plan described in title one-A
32 of article twenty-five of the public health law;
33 (c) is not eligible for minimum essential coverage, as defined in
34 section 5000A(f) of the Internal Revenue Service Code of 1986, or is
35 eligible for an employer-sponsored plan that is not affordable, in
36 accordance with section 5000A of such code; provided, however, that the
37 commissioner of health may seek authority from the secretary of health
38 and human services to permit individuals who are eligible for a small
39 group employer-sponsored plan to purchase coverage through the basic
40 health program buy-in; and
41 (d) (i) except as provided by subparagraph (ii) of this paragraph, has
42 household income at or below two hundred percent of the federal poverty
43 line defined and annually revised by the United States department of
44 health and human services for a household of the same size, unless the
45 individual or an eligible small group purchases coverage through a basic
46 health plan under the basic health program buy-in set forth under subdi-
47 vision eleven or twelve of this section; and has household income that
48 exceeds one hundred thirty-three percent of the federal poverty line
49 defined and annually revised by the United States department of health
50 and human services for a household of the same size; however, MAGI
51 eligible noncitizens lawfully present in the United States with house-
52 hold incomes at or below one hundred thirty-three percent of the federal
53 poverty line shall be eligible to receive coverage for health care
54 services pursuant to the provisions of this title if such noncitizen
55 would be ineligible for medical assistance under title eleven of this
56 article due to their immigration status;
S. 8614 4
1 (ii) subject to federal approval and the use of state funds, unless
2 the commissioner may use funds under subdivision seven of this section,
3 has household income at or below two hundred fifty percent of the feder-
4 al poverty line defined and annually revised by the United States
5 department of health and human services for a household of the same
6 size; and has household income that exceeds one hundred thirty-three
7 percent of the federal poverty line defined and annually revised by the
8 United States department of health and human services for a household of
9 the same size; however, MAGI eligible [aliens] noncitizens lawfully
10 present in the United States with household incomes at or below one
11 hundred thirty-three percent of the federal poverty line shall be eligi-
12 ble to receive coverage for health care services pursuant to the
13 provisions of this title if such [alien] noncitizen would be ineligible
14 for medical assistance under title eleven of this article due to their
15 immigration status;
16 (iii) subject to federal approval if required and the use of state
17 funds, unless the commissioner may use funds under subdivision seven of
18 this section, a pregnant individual who is eligible for and receiving
19 coverage for health care services pursuant to this title is eligible to
20 continue to receive health care services pursuant to this title during
21 the pregnancy and for a period of one year following the end of the
22 pregnancy without regard to any change in the income of the household
23 that includes the pregnant individual, even if such change would render
24 the pregnant individual ineligible to receive health care services
25 pursuant to this title;
26 (iv) subject to federal approval, a child born to an individual eligi-
27 ble for and receiving coverage for health care services pursuant to this
28 title who would be eligible for coverage pursuant to subparagraphs [(2)]
29 two or [(4)] four of paragraph (b) of subdivision [1] one of section
30 three hundred [and] sixty-six of [the social services law] this article
31 shall be deemed to have applied for medical assistance and to have been
32 found eligible for such assistance on the date of such birth and to
33 remain eligible for such assistance for a period of one year.
34 An applicant who fails to make an applicable premium payment, if any,
35 shall lose eligibility to receive coverage for health care services in
36 accordance with time frames and procedures determined by the commission-
37 er.
38 3-a. Basic health program buy-in. A person or an eligible small group
39 shall be permitted to purchase coverage from the state to enroll an
40 individual or any qualified dependents in a basic health plan through
41 the basic health program buy-in described under subdivision ten of this
42 section, as long as the individual, and any qualified dependents other-
43 wise meet the eligibility requirements in paragraphs (a), (b), and (c)
44 of subdivision three of this section. An applicant who fails to make an
45 applicable premium payment shall lose eligibility to receive coverage
46 for health care services in accordance with time frames and procedures
47 determined by the commissioner.
48 4. Enrollment. (a) Subject to federal approval, the commissioner is
49 authorized to establish an application and enrollment procedure for
50 prospective enrollees. Such procedure shall include a verification
51 system for applicants, which shall be consistent with 42 USC § 1320b-7.
52 (b) Such procedure shall allow for continuous enrollment for enrollees
53 to the basic health program where an individual may apply and enroll for
54 coverage at any point.
55 (c) Upon an applicant's enrollment in a basic health insurance plan,
56 coverage for health care services pursuant to the provisions of this
S. 8614 5
1 title shall be prospective. Coverage shall begin in a manner consistent
2 with the requirements for qualified health plans offered through the
3 health insurance exchange marketplace, as delineated in federal regu-
4 lation at 42 CFR 155.420(b)(1) or any successor regulation thereof.
5 (d) A person who has enrolled for coverage pursuant to this title, and
6 who loses eligibility to enroll in the basic health program for a reason
7 other than citizenship status, lack of state residence, failure to
8 provide a valid social security number, providing inaccurate information
9 that would affect eligibility when requesting or renewing health cover-
10 age pursuant to this title, or failure to make an applicable premium
11 payment, before the end of a twelve month period beginning on the effec-
12 tive date of the person's initial eligibility for coverage, or before
13 the end of a twelve month period beginning on the date of any subsequent
14 determination of eligibility, shall have [his or her] their eligibility
15 for coverage continued until the end of such twelve month period,
16 provided that the state receives federal approval for using funds from
17 the basic health program trust fund, established under section 97-oooo
18 of the state finance law, for the costs associated with such assistance.
19 5. Premiums and cost sharing. (a) Subject to federal approval, the
20 commissioner shall establish premium payments enrollees shall pay to
21 approved organizations for coverage of health care services pursuant to
22 this title. No payment is required for individuals with a household
23 income at or below two hundred percent of the federal poverty line
24 defined and annually revised by the United States department of health
25 and human services for a household of the same size.
26 (a-1) For an individual with a household income above two hundred
27 percent of the federal poverty line defined and annually revised by the
28 United States department of health and human services for a household of
29 the same size, an individual who purchases individual, or family cover-
30 age through the basic health program buy-in under subdivision ten of
31 this section, or an eligible small group who purchases or contributes to
32 the cost of such coverage under subdivision eleven of this section for
33 such individual and any qualified dependents, shall make monthly
34 payments equaling the per member-per month payment received by a basic
35 health plan for providing basic health program services in the region
36 where the individual resides, provided that the commissioner shall
37 pursue any federal waivers and be permitted to take any other actions
38 necessary to use federal premium tax credits cost sharing reductions,
39 and any other federal subsidies that may be available for such individ-
40 uals, and in the absence of federal subsidies, state funds, to finance
41 the program and keep the applicable premium payments and cost sharing
42 owed for basic health program buy-in members as affordable as possible
43 and consistent with the coverage and benefit design applicable to basic
44 health program beneficiaries. The commissioner shall be authorized to
45 create variable premium amounts and plan designs based on income,
46 consistent with current practice, such that individuals at lower house-
47 hold income levels could pay lower premiums and have lower or less cost
48 sharing compared to individuals at higher income levels.
49 (a-2) Eligible small groups that purchase coverage for an individual
50 and any qualified dependents under subdivision eleven of this section
51 may be required to pay to the state or basic health plan, a premium
52 supplement payment as described in subparagraph (ii) of paragraph (a-3)
53 of this subdivision. Such fund shall be used to help ensure program
54 viability, and for other purposes that may be allowed by the secretary
55 of health and human services, including but not limited to, rate adequa-
S. 8614 6
1 cy for approved organizations and network providers, as may be deter-
2 mined by the commissioner.
3 (a-3) (i) The commissioner shall contract with an independent actuary
4 to study and make recommendations around premiums and cost sharing for
5 the basic health program buy-in. The analysis for developing premiums
6 for approved organizations shall include an analysis of rates of payment
7 in relation to the expected population to be served adjusted for case
8 mix, the scope of health care services approved organizations must
9 provide, the projected utilization of such services, the network of
10 providers required to meet state standards, and subject to approval from
11 the secretary of health and human services and the division of the budg-
12 et, existing rates of payment in effect under the basic health program,
13 and subject to approval by the secretary of health and human services
14 and subject to the discretion of the commissioner and the division of
15 the budget once enrollment in the basic health program buy-in has
16 reached more than two hundred thousand enrollees, rates of payment in
17 effect under Medicare Part A, B, and C.
18 (ii) Premium supplement payments. The analysis conducted by the inde-
19 pendent actuary shall include recommended premium supplement payment
20 amounts that the commissioner, in consultation with the division of the
21 budget, may require to be paid by certain individuals or eligible small
22 groups to increase available funds and maintain the affordability of the
23 basic health program for individuals at lower income levels who obtain
24 coverage under the buy-in described in subdivisions ten and eleven of
25 this section. The analysis may consider anticipated savings for eligi-
26 ble small groups and individuals who would otherwise have to purchase
27 coverage from the health insurance exchanges or the small group market,
28 as applicable, to provide varying options of premium supplements across
29 household income levels and small group size.
30 (a-4) For coverage purchased through subdivision ten or eleven of this
31 section, for individuals and qualified dependents with household incomes
32 above five hundred percent of the federal poverty line, as defined and
33 annually revised by the United States department of health and human
34 services for a household of the same size, or any eligible small group
35 purchasing or contributing to such coverage on their behalf, in the
36 discretion of the commissioner and the division of the budget, a premium
37 supplement payment may be required by either individuals or eligible
38 small groups to increase state share funds for the program. The premium
39 supplement amount may vary based on income levels and shall be deter-
40 mined by the commissioner to ensure the program remains affordable and
41 does not present undue barriers to purchasing coverage.
42 (b) The commissioner shall establish cost sharing obligations for
43 enrollees, subject to federal approval. There shall be no cost-sharing
44 obligations for enrollees for dental and vision services as defined in
45 subparagraph (ii) of paragraph (c) of subdivision one of this section;
46 services and supports as defined in subparagraph (iii) of paragraph (c)
47 of subdivision one of this section; and health care services authorized
48 under subparagraphs (iii) and (iv) of paragraph (d) of subdivision three
49 of this section. Such cost sharing shall: (i) not include deductibles
50 for individuals at any household income level; (ii) subject to avail-
51 able funds, not require any cost sharing for household incomes not
52 exceeding five hundred percent of the federal poverty line defined and
53 annually revised by the United States department of health and human
54 services for a household of the same size, but if this is not possible,
55 then such cost sharing shall be set as low as possible for the lowest
56 household incomes; and (iii) not be established as a percentage
S. 8614 7
1 of the cost of the service and comprise a fixed cost intended to be as
2 affordable as possible and not act as a barrier to care, that
3 in no event shall be more than two hundred dollars for any covered
4 health care service. Cost sharing owed for services above five
5 hundred percent of the federal poverty line shall vary based on income
6 to promote equity and fairness.
7 6. Rates of payment. (a) The commissioner shall select the contract
8 with an independent actuary to study and recommend appropriate
9 reimbursement methodologies for the cost of health care service coverage
10 pursuant to this title. Such independent actuary shall review and make
11 recommendations concerning appropriate actuarial assumptions relevant to
12 the establishment of reimbursement methodologies, including but not
13 limited to; the adequacy of rates of payment in relation to the popu-
14 lation to be served adjusted for case mix, the scope of health care
15 services approved organizations must provide, the utilization of such
16 services and the network of providers required to meet state standards,
17 existing rates of payment in effect under the basic health program, and
18 subject to approval by the secretary of health and human services and
19 the division of the budget, and once enrollment in the basic health
20 program buy-in has reached more than one hundred thousand enrollees,
21 rates of payment in effect under Medicare Part A, B, and C.
22 (b) Upon consultation with the independent actuary and entities
23 representing approved organizations, the commissioner shall develop
24 reimbursement methodologies and fee schedules for determining rates of
25 payment, which rate shall be approved by the director of the division of
26 the budget, to be made by the department to approved organizations for
27 the cost of health care services coverage pursuant to this title. Such
28 reimbursement methodologies and fee schedules may include provisions for
29 capitation arrangements.
30 (c) The commissioner shall have the authority to promulgate regu-
31 lations, including emergency regulations, necessary to effectuate the
32 provisions of this subdivision.
33 (d) The department shall require the independent actuary selected
34 pursuant to paragraph (a) of this subdivision to provide a complete
35 actuarial report, along with all actuarial assumptions made and all
36 other data, materials and methodologies used in the development of rates
37 for the basic health plan authorized under this section. Such report
38 shall be provided annually to the temporary president of the senate and
39 the speaker of the assembly.
40 7. Any funds transferred by the secretary of health and human services
41 to the state pursuant to 42 U.S.C. 18051(d) shall be deposited in trust.
42 Funds from the trust shall be used for providing health benefits through
43 [an approved organization] a basic health plan, which, at a minimum,
44 shall include essential health benefits as defined in 42 U.S.C.
45 18022(b); to reduce the premiums, if any, and cost sharing of partic-
46 ipants in the basic health program; or for such other purposes as may be
47 allowed by the secretary of health and human services. Health benefits
48 available through the basic health program shall be provided by one or
49 more approved organizations pursuant to an agreement with the department
50 of health and shall meet the requirements of applicable federal and
51 state laws and regulations.
52 8. An individual who is lawfully admitted for permanent residence,
53 permanently residing in the United States under color of law, or who is
54 a non-citizen in a valid nonimmigrant status, as defined in 8 U.S.C.
55 1101(a)(15), and who would be ineligible for medical assistance under
56 title eleven of this article due to [his or her] their immigration
S. 8614 8
1 status if the provisions of section one hundred twenty-two of this chap-
2 ter were applied, shall be considered to be ineligible for medical
3 assistance for purposes of paragraphs (b) and (c) of subdivision three
4 of this section.
5 9. Reporting. The commissioner shall submit a report to the temporary
6 president of the senate and the speaker of the assembly annually by
7 December thirty-first. The report shall include, at a minimum, an analy-
8 sis of the basic health program and its impact on the financial interest
9 of the state; its impact on the health benefit exchange including
10 enrollment and premiums; its impact on the number of uninsured individ-
11 uals in the state; its impact on the Medicaid global cap; its impact on
12 health care affordability for middle class New Yorkers; its impact on
13 small business and economic activity; its impact on population trends in
14 the state; the impact of basic health program payment rates on hospital
15 finances and financial sustainability, and recommendations to address
16 any potential concerns based on migration from the commercial insurance
17 market to the basic health program; and the demographics of basic health
18 program enrollees including age and immigration status.
19 10. Network participation. Any provider licensed or certified under
20 article thirty-one or thirty-two of the mental hygiene law, and any
21 hospital licensed under article twenty-eight of the public health law,
22 including any clinic, physician or specialist group, outpatient facility
23 or practice, ambulatory care setting or other office-based setting, or
24 other health care setting owned in whole or in part by a hospital
25 licensed under article twenty-eight of the public health law, as well as
26 any single or multi-specialty free-standing ambulatory surgery centers
27 licensed under article twenty-eight of the public health law, shall make
28 covered health care services available to any individual in the basic
29 health program. Approved organizations operating basic health plans and
30 providers shall use good faith efforts to negotiate network partic-
31 ipation arrangements to provide covered services for individuals
32 enrolled in the basic health program.
33 11. Basic health program buy-in for individuals. Any individual who
34 meets the eligibility requirements of paragraphs (a) and (b) of subdivi-
35 sion three of this section shall be permitted to purchase basic health
36 program coverage for themselves and any qualified dependents who other-
37 wise meet the eligibility requirements of paragraphs (a) and (b) of
38 subdivision three of this section, through the basic health program
39 buy-in. Subject to approval from the United States secretary of health
40 and human services, the basic health program buy-in shall allow eligible
41 individuals to pay the regional per member, per month premium that is
42 paid to a basic health plan for eligible individuals in the region, or
43 any subsidized premium based on the availability of federal or state
44 subsidies as basic health program funds permit, for themselves and any
45 qualified dependents, and gain coverage through the basic health
46 program.
47 12. Basic health program buy-in for eligible small groups. Any eligi-
48 ble small group may pay to a basic health plan the full or partial
49 amount of the premium costs for an individual and their qualified depen-
50 dents to buy-in to the basic health program as a benefit to members of
51 the eligible small group. The commissioner shall establish procedures
52 through which eligible small groups can pay voluntary premium contrib-
53 utions, and if contributions are made, any applicable required subsidy
54 equivalency payments and premium supplements for covered individuals and
55 their qualified dependents, directly to a basic health plan on an aggre-
56 gate, monthly basis.
S. 8614 9
1 13. The commissioner shall seek any federal waivers, approvals, and
2 take any and all actions necessary to implement this section, including
3 but not limited to federal waivers and approvals, and pursue any state
4 statutory or regulatory changes necessary to implement this act, includ-
5 ing establishing penalties, fines, and oversight authority, in conjunc-
6 tion with the department of taxation and finance, to capture accurate
7 information from individuals and eligible small groups, and ensure
8 eligible small groups are complying with the requirements of this
9 section.
10 § 2. This act shall take effect on the one hundred eightieth day after
11 it shall have become a law. Effective immediately, the addition, amend-
12 ment and/or repeal of any rule or regulation necessary for the implemen-
13 tation of this act on its effective date are authorized to be made and
14 completed on or before such effective date; provided, further, that the
15 amendments to paragraphs (c) and (e) of subdivision 1, paragraph (d) of
16 subdivision 3, and subdivisions 5 and 7 of section 369-gg of the social
17 services law made by section one of this act shall not affect the expi-
18 ration of such paragraphs and subdivisions and shall be deemed to expire
19 therewith.
20 PART B
21 Section 1. Legislative intent. The legislature finds and declares all
22 of the following:
23 The medical care a person requires should never result in financial
24 hardship or bankruptcy, yet for too many New Yorkers, an unexpected
25 medical emergency or diagnosis carries both life-altering health and
26 financial consequences. An individual should not need to substantially
27 modify theirs and their family's future by liquidating college or
28 retirement savings or need to create a "Go-Fund Me" to afford the bills
29 from a medical emergency.
30 As a result of the Affordable Care Act, health insurance plans today
31 are required to establish out-of-pocket payment maximums that are
32 intended to limit one's out-of-pocket cost liability for health care
33 expenses. However, the out-of-pocket maximum excludes out-of-network
34 care as well as premium contributions paid by an individual. This means
35 that the sum of premium payments a person makes for their health care
36 does not count towards the out-of-pocket cap. It also means what is
37 often the most expensive health care services that may be rendered for
38 an individual, out-of-network health care services are not subject to
39 the maximum cap, and even if a plan offers an out-of-network cap, this
40 may be so high that it offers no relief for the consumer.
41 While there are many contributing factors as to why individuals under-
42 going treatment receive unaffordable medical bills, out-of-network
43 charges continue to top that list. New York has tried to protect
44 consumers from out-of-network bills through the Independent Dispute
45 Resolution process. Unfortunately, it has not been able to protect
46 consumers from experiencing crushing financial burdens associated with
47 costly medical care, and has created an incentive for costs to increase.
48 Specifically, studies have shown New York's Independent Dispute Resol-
49 ution process and its ultimate reliance on providers' own charges,
50 instead of what providers are actually reimbursed from commercial health
51 insurers for the services provided, has deeply harmed consumers,
52 contributing more than anything else to the severe financial burden New
53 Yorkers' experience and associate when they are undergoing treatment or
54 experience a medical crisis. The Independent Dispute Resolution process
S. 8614 10
1 creates a financial incentive for providers to remain out-of-network and
2 consistently increase their "charges", as charges are part of the crite-
3 ria used to determine payment of a disputed out-of-network charge. High-
4 er charges also result in higher Independent Dispute Resolution awards
5 and more costs being built into premiums in subsequent years, creating
6 an annual spiral of increasing costs that burden us all. It is essen-
7 tial to address health care costs in a way that is fair to our providers
8 but ultimately puts consumers first.
9 § 2. Article 6 of the financial services law is REPEALED and a new
10 article 6 is added to read as follows:
11 ARTICLE 6
12 CONSUMER PROTECTION FROM HEALTH CARE COSTS
13 Section 601. Applicability.
14 602. Definitions.
15 603. Rates of payment for non-participating services.
16 604. Annual limit on consumer health care expenditures.
17 § 601. Applicability. This article shall not apply to health care
18 services, including emergency services, where physician fees are subject
19 to schedules or other monetary limitations under any other law, includ-
20 ing the workers' compensation law and article fifty-one of the insurance
21 law, and shall not preempt any such law, any program for individuals
22 covered by article five of the social services law, article twenty-five
23 of the public health law, titles XVIII, XIX, and XXI of the federal
24 social security act, or chapter 89 of title 5 of the United States code.
25 § 602. Definitions. For purposes of this article:
26 (a) "Emergency health care services" means health care services
27 rendered to an insured experiencing an "emergency condition".
28 (b) "Emergency condition" means medical or behavioral condition that
29 manifests itself by acute symptoms of sufficient severity, including
30 severe pain, such that a prudent layperson, possessing an average know-
31 ledge of medicine and health, could reasonably expect the absence of
32 immediate medical attention to result in: (1) placing the health of the
33 person afflicted with such condition in serious jeopardy, or in the case
34 of a behavioral condition placing the health of such person or others in
35 serious jeopardy; (2) serious impairment to such person's bodily func-
36 tions; (3) serious dysfunction of any bodily organ or part of such
37 person; (4) serious disfigurement of such person; or (5) a condition
38 described in clause (i), (ii) or (iii) of section 1867(e)(1)(A) of the
39 social security act 42 U.S.C. 1395dd.
40 (c) "Health care plan" means an insurer licensed to write accident and
41 health insurance pursuant to article thirty-two of the insurance law; a
42 corporation organized pursuant to article forty-three of the insurance
43 law; a municipal cooperative health benefit plan certified pursuant to
44 article forty-seven of the insurance law; a health maintenance organiza-
45 tion certified pursuant to article forty-four of the public health law;
46 or a student health plan established or maintained pursuant to section
47 one thousand one hundred twenty-four of the insurance law.
48 (d) "Insured" means a patient covered under a health care plan's poli-
49 cy or contract.
50 (e) "Nonemergency health care services" means health care services
51 rendered to an insured experiencing a medical condition other than an
52 emergency condition.
53 (f) "In-network contracted rate" means the rate contracted between an
54 insured's health care plan and a participating health care provider for
55 the reimbursement of health care services delivered by that health care
56 provider to the insured.
S. 8614 11
1 (g) "Median, in-network contracted rate" means the median allowed
2 amount paid to in-network providers for a specific service by a specific
3 health plan.
4 (h) "Non-participating commercial rate for emergency services" means
5 the amount set pursuant to this section, and used to determine the rate
6 of payment to a health care provider for the provision of emergency
7 health care services to an insured when the health care provider is not
8 in the insurer's network.
9 (i) "Noncontracted commercial rate for nonemergency services" means
10 the amount set pursuant to this section, and used to determine the rate
11 of payment to a health care provider for the provision of nonemergency
12 health care services to an insured when the health care provider is not
13 in the insurer's network.
14 § 603. Rates of payment for non-participating services. All health
15 care plans shall pay non-participating providers of emergency and non-
16 emergency health care services provided to an insured at the insurers
17 median, in-network rate for the service provided. Providers shall be
18 prohibited from balance billing an insured for any amount above the
19 median, in-network rate paid for the health care service. The super-
20 intendent may promulgate regulations necessary to implement this
21 section, including establishing a default out-of-network reimbursement
22 rate for both emergency and non-emergency services, which shall account
23 for the actual average in-network reimbursed amount for the claim, and
24 may be set as a percentage of the Medicare fee schedule rate for the
25 service.
26 § 604. Annual limit on consumer health care expenditures. (a) Notwith-
27 standing any out-of-pocket maximums that may exist today, the super-
28 intendent shall establish annual limits on the overall financial amount
29 an insured shall be responsible for in the state regulated commercial
30 health insurance market, for payment of health care costs under a
31 contract with a New York state regulated health plan, which shall be
32 inclusive of all premium contributions made directly by the individual
33 for individual or family coverage, as well as any amounts paid towards
34 copays, coinsurance, and deductibles, for health care services, irre-
35 spective of whether the service is provided by an in-network or out-of-
36 network provider, such that when the total amount of health care costs
37 paid by an individual reaches the applicable limit, the consumer is no
38 longer financially responsible to the insurer for payment of out-of-
39 pocket costs. For purposes of this section, any financial contributions
40 toward the premium made by an employer for health insurance coverage
41 shall not count towards the annual out-of-pocket maximum.
42 (b) In implementing subsection (a) of this section, the superintendent
43 may use the IRS Employer Health Plan Affordability Threshold as a base-
44 line, but shall establish cap amounts at various household income
45 levels, such that individuals with less household income shall be
46 subject to a lower annual payment cap, and individuals with higher
47 household income shall be subject to a higher annual cap, but in no
48 event shall the annual out-of-pocket maximum cap more than double the
49 IRS Employer Health Plan Affordability Threshold for individuals at any
50 income level. The superintendent shall be permitted to apply for any
51 federal waivers and pursue any reinsurance options for insurers or the
52 state and take other actions consistent with this section to implement
53 its intent.
54 (c) The commissioner of health shall work with the commissioner of
55 taxation and finance to establish appropriate penalties and safeguards
56 to ensure proper implementation of this article.
S. 8614 12
1 § 3. This act shall take effect immediately, provided however, that
2 it shall apply to all health care plan policies beginning on January 1,
3 2027. Effective immediately, the addition, amendment and/or repeal of
4 any rule or regulation necessary for the implementation of this act on
5 its effective date are authorized to be made and completed on or before
6 such effective date.
7 § 2. Severability clause. If any clause, sentence, paragraph, subdivi-
8 sion, section or part of this act shall be adjudged by a court of compe-
9 tent jurisdiction to be invalid, such judgment shall not affect, impair,
10 or invalidate the remainder thereof, but shall be confined in its opera-
11 tion to the clause, sentence, paragraph, subdivision, section or part
12 thereof directly involved in the controversy in which such judgment
13 shall have been rendered. It is hereby declared to be the intent of the
14 legislature that this act would have been enacted even if such invalid
15 provision had not been included herein.
16 § 3. This act shall take effect immediately; provided, however, that
17 the applicable effective date of Parts A through B of this act shall be
18 as specifically set forth in the last section of such Parts.
