NEW YORK STATE ASSEMBLY MEMORANDUM IN SUPPORT OF LEGISLATION submitted in accordance with Assembly Rule III, Sec 1(f)
BILL NUMBER: A252
SPONSOR: Cahill TITLE OF BILL:
An act to amend the social services law, the public health law and the
insurance law, in relation to prohibiting a provider of health care
coverage from requiring providers of behavioral health services to offer
all products offered by the provider of health care coverage
PURPOSE:
To assure that behavioral health providers are permitted to select by
execution of separate agreements the products that the provider will
participate in with health care plans and health insurers.
SUMMARY OF PROVISIONS:
Section one of the bill would amend Social Services law § 365-m to
require Medicaid managed care plans to execute separate contracts with
behavioral healthcare providers to provide coverage to Medicaid enrol-
lees rather than rely upon previously-executed contracts.
Sections two through five make corresponding changes to Public Health
Law § 2511 for child health plus plans and Public Health Law § 4406-c
and Insurance Law §§ 3217-b and 4325, respectively for other health care
plans and health insurers.
Section six provides that this act shall take effect immediately.
JUSTIFICATION:
Beginning in the summer of 2015, mental health and substance abuse
clients and the providers who serve them will be moving out of Medicaid
fee-for-service and into a managed care environment. Providers will be
paid by managed care organizations (MCOs) for Medicaid clients pursuant
to rates and terms defined in contracts with MCOs.
Health insurance plans often include an All Products clause (APC) in
their contracts with providers. The APC requires the provider to take
all current and future product lines brought to them by the plans. If
the provider does not agree to take all products - including those that
do not include fair terms or adequately reimburse for their cost of
services, then the provider cannot participate in the network for any of
the insurance product lines. This would apply to products that serve
Medicaid beneficiaries as well as patients enrolled in commercial, the
Health Insurance Exchange and employer plans. The result could be a very
serious access to care crisis in the public mental health and substance
abuse services system - the front line providers for people with serious
mental illness and those struggling with very serious substance abuse,
opioid, heroin and other addictions.
A State Office of Mental Health study conducted in 2012 revealed that
approximately 40% of these providers are in significant financial
distress. This is due in part to the fact that in the behavioral health
system, commercial rates are paid at between 1/4 and 1/3 the rate
currently paid for Medicaid fee for service. When this population is
moved in managed care and all rates are able to be set by the plans at
these disparately low levels through the use of APCs, providers would be
in the untenable position of either discontinuing existing relationships
with clients or accepting rates that are well below their costs for
providing services.
The All Products clause disrupts existing relationships between clini-
cians and clients, and threatens continued access to care in a service
system already overloaded with long waiting lists, workforce shortages
and abysmal commercial rates. Seven states across the country have
already banned the use of the APC in contracts between MCOs and certain
providers. Attorneys General across the country as well as court deci-
sions have prohibited plans from using the APC in contracts in instances
where doing so has been deemed an unfair business practice to gain
market share and deny competition that would otherwise occur.
This legislation would take a similar action by prohibiting the use of
the All Products clause in contracts between behavioral health providers
and MCOs and other health insurance plans This is essential to assure
continued access to care and continuity of care for our most vulnerable
citizens who utilize the public mental health and substance abuse
system. Doing so is also critical to ensuring a smooth transition of
behavioral health clients into Medicaid managed care by giving the
providers an opportunity to negotiate reasonable contracts with the
plans for the clients they serve.
LEGISLATIVE HISTORY:
2017-2018: A.23 - Passed Assembly
2015-2016: A.7846A - Referred to Health
FISCAL IMPLICATIONS:
None.
EFFECTIVE DATE:
This act shall take immediately.
STATE OF NEW YORK
________________________________________________________________________
252
2019-2020 Regular Sessions
IN ASSEMBLY(Prefiled)
January 9, 2019
___________
Introduced by M. of A. CAHILL -- read once and referred to the Committee
on Health
AN ACT to amend the social services law, the public health law and the
insurance law, in relation to prohibiting a provider of health care
coverage from requiring providers of behavioral health services to
offer all products offered by the provider of health care coverage
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. Section 365-m of the social services law is amended by
2 adding a new subdivision 6 to read as follows:
3 6. (a) No managed care provider under section three hundred sixty-
4 four-j of this title shall by contract or written policy or procedure,
5 require a behavioral health services provider to participate in the
6 in-network portion of any product offered by such managed care provider,
7 other than products under such section. Behavioral health services
8 providers shall have the right to select by execution of a separate
9 agreement the products of such managed care provider in which the
10 provider agrees to participate in the in-network portion.
11 (b) As used in this subdivision, "behavioral health services" means
12 inpatient and outpatient behavioral health services provided by those
13 licensed or certified pursuant to article thirty-one or thirty-two of
14 the mental hygiene law, or programs that are licensed pursuant to both
15 article thirty-one of the mental hygiene law and article twenty-eight of
16 the public health law, or certified under both article thirty-two of the
17 mental hygiene law and article twenty-eight of the public health law.
18 § 2. Section 2511 of the public health law is amended by adding a new
19 subdivision 22 to read as follows:
20 22. (a) No approved organization shall by contract or written policy
21 or procedure, require a behavioral health services provider to partic-
22 ipate in the in-network portion of any product offered by such organiza-
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD00070-01-9
A. 252 2
1 tion, other than products under this title. Behavioral health services
2 providers shall have the right to select by execution of a separate
3 agreement the products of such approved organization in which the
4 provider agrees to participate in the in-network portion.
5 (b) As used in this subdivision, "behavioral health services" means
6 inpatient and outpatient behavioral health services provided by those
7 licensed or certified pursuant to article thirty-one or thirty-two of
8 the mental hygiene law, or programs that are licensed pursuant to both
9 article thirty-one of the mental hygiene law and article twenty-eight of
10 this chapter, or certified under both article thirty-two of the mental
11 hygiene law and article twenty-eight of this chapter.
12 § 3. Section 4406-c of the public health law is amended by adding a
13 new subdivision 10 to read as follows:
14 10. (a) No health care plan licensed pursuant to this article shall by
15 contract or written policy or procedure, require a behavioral health
16 services provider to participate in the in-network portion of any prod-
17 uct offered by such plan. Behavioral health services providers shall
18 have the right to select by execution of a separate agreement the
19 products of such plan in which the provider agrees to participate in the
20 in-network portion.
21 (b) As used in this subdivision, "behavioral health services" means
22 inpatient and outpatient behavioral health services provided by those
23 licensed or certified pursuant to article thirty-one or thirty-two of
24 the mental hygiene law, or programs that are licensed pursuant to both
25 article thirty-one of the mental hygiene law and article twenty-eight of
26 this chapter, or certified under both article thirty-two of the mental
27 hygiene law and article twenty-eight of this chapter.
28 § 4. Section 3217-b of the insurance law is amended by adding a new
29 subsection (l) to read as follows:
30 (l) (1) No insurer subject to the provisions of this article shall by
31 contract, written policy or procedure, require a behavioral health
32 services provider to participate in the in-network portion of any prod-
33 uct offered by such insurer. Behavioral health services providers shall
34 have the right to select by execution of a separate agreement the
35 products of such insurers in which the provider agrees to participate in
36 the in-network portion.
37 (2) As used in this subsection, "behavioral health services" means
38 inpatient and outpatient behavioral health services provided by those
39 licensed or certified pursuant to article thirty-one or thirty-two of
40 the mental hygiene law, or programs that are licensed pursuant to both
41 article thirty-one of the mental hygiene law and article twenty-eight of
42 the public health law, or certified under both article thirty-two of the
43 mental hygiene law and article twenty-eight of the public health law.
44 § 5. Section 4325 of the insurance law is amended by adding a new
45 subsection (m) to read as follows:
46 (m) (1) No corporation organized pursuant to this article shall by
47 contract, written policy or procedure, require a behavioral health
48 services provider to participate in the in-network portion of any prod-
49 uct offered by such corporation. Behavioral health services providers
50 shall have the right to select by execution of a separate agreement the
51 products of such corporation in which the provider agrees to participate
52 in the in-network portion.
53 (2) As used in this subsection, "behavioral health services" means
54 inpatient and outpatient behavioral health services provided by those
55 licensed or certified pursuant to article thirty-one or thirty-two of
56 the mental hygiene law, or programs that are licensed pursuant to both
A. 252 3
1 article thirty-one of the mental hygiene law and article twenty-eight of
2 the public health law, or certified under both article thirty-two of the
3 mental hygiene law and article twenty-eight of the public health law.
4 § 6. This act shall take effect immediately.
