Bill S2452-2013

Provides certain coverage for diagnosis and treatment of chemical abuse and chemical dependence

Provides certain coverage for diagnosis and treatment of chemical abuse and chemical dependence.

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  • Jan 8, 2014: REFERRED TO INSURANCE
  • Jan 17, 2013: REFERRED TO INSURANCE

Memo

BILL NUMBER:S2452

TITLE OF BILL: An act to amend the insurance law, in relation to providing certain coverage for diagnosis and treatment of chemical abuse and chemical dependence

PURPOSE: Provides that the benefits provided through group health insurance policies and health plans for the treatment of chemical abuse and chemical dependence be comparable to medical services.

SUMMARY OF PROVISIONS:

Section 1. Converts the current insurance law requirement that group and school blanket policies be made available as an option to provide coverage for benefits comparable to medical benefits for the diagnosis and treatment of chemical abuse and chemical dependence to a requirement for fully insured groups in NYS; conforms this requirement to the requirements made by "Timothy's Law" for mental health benefits, pursuant to Chapter 748 of the Laws of2006 and Chapter 502 of the Laws of2007, and a Chapter of the laws of2009; and requires the Superintendent of Insurance to develop a methodology to fully cover the cost of this requirement to any employer of fifty or fewer employees, to be financed from the General Fund.

Section 2. Makes conforming amendments to the current requirement and comparability standard that group and school blanket policies provide coverage for at least 60 outpatient visits for the diagnosis and treatment of chemical dependence of which up to twenty may be for family members, including provisions relating to policies covering physician services consistent with Chapter 502 of the Laws of 2007.

Section 3. Converts the current insurance law requirement that hospital service corporations or health service corporations which provide group, group remittance or school blanket coverage for inpatient hospital care make available as an option coverage for benefits comparable to medical benefits for the diagnosis and treatment of chemical abuse and chemical dependence to a requirement for fully insured groups in NYS; conforms this requirement to the requirements made by "Timothy's Law" for mental health benefits, pursuant to Chapter 748 of the Laws of 2006 and Chapter 502 of the Laws of 2007, and a Chapter of the laws of 2009; and requires the Superintendent of Insurance to develop a methodology to fully cover the cost of this requirement to any employer of fifty or fewer employees, to be financed from the General Fund.

Section 4. Makes conforming amendments to the current requirement and comparability standard that hospital service corporation or health service corporations which provide group, group remittance or school blanket coverage for inpatient hospital care provide coverage for at least 60 outpatient visits for the diagnosis and treatment of chemical dependence of which up to twenty may be for family members.

Section 5. Requires the Superintendent of Insurance to ensure that insurers' contracts or policies do not contain unreasonable definitions

of chemical abuse, alcohol and substance abuse, chemical dependence, alcoholism and substance dependence in their contracts or policies.

Section 6. Provides that this legislation will take effect on the first of January next succeeding the date on which it becomes a law; and that its provisions will apply to policies and contracts issued, renewed, modified, altered or amended on or after the effective date.

JUSTIFICATION: Timothy's Law (Chapter 748 of the Laws of 2006), one of the 42 state mental health parity laws in the US, took effect January 1, 2007 and applies to most insurance policies in New York on the day they are issued, renewed, modified, altered, or amended. Before the law passed, health plans were permitted to discriminate against those with mental health needs by charging much higher co-payments and deductibles for inpatient and outpatient mental health care compared with the fees they charge consumers for regular medical office visits. Top health plans also recently began to restrict coverage for mental health conditions, exclude coverage for chronic mental illnesses, and impose life time limits on inpatient psychiatric care. Timothy's Law remedied many of these barriers to care.

Predating Timothy's Law, insurance coverage for the diagnosis and treatment of chemical abuse and chemical dependence included required coverage of 60 outpatient visits and optional coverage for inpatient detoxification and rehabilitation service which plans were required to offer to employers seeking such coverage.

Further, Federal law recently added mental health parity requirements to the Child Health Insurance plans (effective April 1, 2009) and Medicare (effective on a phased in schedule over the next few years) as well as self-insured plans and other large employers, including parity in coverage for the treatment of chemical dependency (effective with plan years beginning after October 3, 2009 except for certain collectively bargained plans that are subject to special rules regarding effective date).

One remaining gap in the insurance landscape is that health plans are not required to provide coverage for inpatient detoxification or rehabilitation services, but merely to offer such coverage for fully insured employers seeking to purchase it.

This legislation assures that such coverage is required and comparable to that which is provided for other medical conditions under these plans and policies, and does not place greater restrictions on coverage for addictions than apply for other needs.

Recent studies confirm the efficacy and cost effectiveness of such coverage, and, furthermore demonstrate that the. costs associated with the enactment of mental health parity legislation are minimal. Actuarial analyses and emerging data from states with parity laws demonstrate that equitable insurance coverage for mental illnesses and chemical dependency is indeed affordable.

Studies demonstrate that the cost of adopting mental health and chemical dependency parity is negligible - often below one per cent.

The NYS Insurance Department projected costs for Timothy's Law premium subsidies for small employers to be about one percent for the premium component attributable to the entire mental health benefit among private insurers and Health Maintenance Organizations in NYS.

The comparability required under this legislation would cost a mere fraction of that sum, since most plans already provide some degree of addiction treatment coverage. Further, the cost to the taxpayer will be reduced, since those who may would need benefits otherwise cost employers dearly due to well documented consequences of untreated addiction including absences and low productivity.

Finally, costs axe incurred by individuals, employers, all levels of government, and society as a whole as a result of addictions that can also cause or contribute to accidents, job dissatisfaction, interpersonal conflict, turnover, disability, workers' compensation, involvement with the criminal justice system, disrupted lives and families, and increased dependency on public resources. By providing comparable coverage for addictions, such disorders can be diagnosed and treated quickly and thoroughly, thus placing less of a burden on public resources and businesses.

LEGISLATIVE HISTORY: 2010: S.7788 (Duane) Died in Insurance

FISCAL IMPLICATIONS: Minimal.

EFFECTIVE DATE: January 1 of the year next succeeding enactment.


Text

STATE OF NEW YORK ________________________________________________________________________ 2452 2013-2014 Regular Sessions IN SENATE January 17, 2013 ___________
Introduced by Sen. HOYLMAN -- read twice and ordered printed, and when printed to be committed to the Committee on Insurance AN ACT to amend the insurance law, in relation to providing certain coverage for diagnosis and treatment of chemical abuse and chemical dependence THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM- BLY, DO ENACT AS FOLLOWS: Section 1. Paragraph 6 of subsection (l) of section 3221 of the insur- ance law, as amended by chapter 558 of the laws of 1999, is amended to read as follows: (6) (A) Every insurer delivering a group or school blanket policy or issuing a group or school blanket policy for delivery, in this state, which provides coverage for inpatient hospital care [must make available and, if requested by the policyholder,] OR COVERAGE FOR PHYSICIAN SERVICES SHALL provide AS PART OF SUCH POLICY BROAD-BASED coverage for the diagnosis and treatment of chemical abuse and chemical dependence, however defined in such policy, AT LEAST EQUAL TO THE COVERAGE PROVIDED FOR OTHER HEALTH CONDITIONS, provided, however, that the term chemical abuse shall mean and include alcohol and substance abuse and chemical dependence shall mean and include alcoholism and substance dependence, however defined in such policy. [Written notice of the availability of such coverage shall be delivered to the policyholder prior to inception of such group policy and annually thereafter, except that this notice shall not be required where a policy covers two hundred or more employ- ees or where the benefit structure was the subject of collective bargaining affecting persons who are employed in more than one state.] (B) Such coverage shall, WHERE THE POLICY PROVIDES COVERAGE FOR INPA- TIENT HOSPITAL CARE, be at least equal to the following: (i) with respect to benefits for detoxification as a consequence of chemical dependence, inpatient benefits in a hospital or a detoxifica-
tion facility may not be limited to less than seven days of active treatment in any CONTRACT YEAR, PLAN YEAR, OR calendar year; and (ii) with respect to benefits for rehabilitation services, such bene- fits may not be limited to less than thirty days of inpatient care in any calendar year. (C) Such coverage may be limited to facilities in New York state which are certified by the office of alcoholism and substance abuse services and, in other states, to those which are accredited by the joint commis- sion on accreditation of hospitals as alcoholism, substance abuse or chemical dependence treatment programs. (D) Such coverage shall be [made available] PROVIDED at the inception of all new policies and with respect to all other policies at any anni- versary date of the policy [subject to evidence of insurability]. (E) Such coverage may be subject to annual deductibles, CO-PAYS and co-insurance as may be deemed appropriate by the superintendent and are consistent with those imposed on other benefits [within a given] UNDER THE policy. [Further, each insurer shall report to the superintendent each year the number of contract holders to whom it has issued policies for the inpatient treatment of chemical dependence, and the approximate number of persons covered by such policies] IN THE EVENT THAT A POLICY PROVIDES COVERAGE FOR BOTH INPATIENT HOSPITAL CARE AND PHYSICIAN SERVICES, THE AGGREGATE OF THE BENEFITS FOR OUTPATIENT CARE OBTAINED UNDER THIS PARAGRAPH MAY BE LIMITED TO NOT LESS THAN SIXTY VISITS IN ANY CONTRACT YEAR, PLAN YEAR OR CALENDAR YEAR. (F) Such coverage shall not replace, restrict or eliminate existing coverage provided by the policy. (G) THE SUPERINTENDENT SHALL DEVELOP AND IMPLEMENT A METHODOLOGY TO FULLY COVER THE COST TO ANY GROUP PURCHASER WITH FIFTY OR FEWER EMPLOY- EES THAT IS A POLICYHOLDER OF A POLICY THAT IS SUBJECT TO THE PROVISIONS OF THIS SECTION FOR PROVIDING THE COVERAGE REQUIRED IN THIS PARAGRAPH AND PARAGRAPH SEVEN OF THIS SUBSECTION. SUCH METHODOLOGY SHALL BE FINANCED FROM FUNDS FROM THE GENERAL FUND THAT SHALL BE MADE AVAILABLE TO THE SUPERINTENDENT FOR SUCH PURPOSE. S 2. Paragraph 7 of subsection (1) of section 3221 of the insurance law, as amended by chapter 565 of the laws of 2000, is amended to read as follows: (7) Every insurer delivering a group or school blanket policy or issu- ing a group or school blanket policy for delivery in this state which provides coverage for inpatient hospital care [must] OR COVERAGE FOR PHYSICIAN SERVICES SHALL provide AS PART OF SUCH POLICY coverage for at least sixty outpatient visits in any CONTRACT YEAR, PLAN YEAR OR calen- dar year for the diagnosis and treatment of chemical dependence of which up to twenty may be for family members, except that this provision shall not apply to a policy which covers persons employed in more than one state or the benefit structure of which was the subject of collective bargaining affecting persons who are employed in more than one state. Such coverage may be limited to facilities in New York state certified by the office of alcoholism and substance abuse services or licensed by such office as outpatient clinics or medically supervised ambulatory substance abuse programs and, in other states, to those which are accredited by the joint commission on accreditation of hospitals as alcoholism or chemical dependence treatment programs. WHERE THE POLICY PROVIDES COVERAGE FOR PHYSICIAN SERVICES, IT SHALL INCLUDE BENEFITS FOR OUTPATIENT CARE PROVIDED BY A PSYCHIATRIST OR PSYCHOLOGIST LICENSED TO PRACTICE IN THIS STATE, A LICENSED CLINICAL SOCIAL WORKER WHO MEETS THE REQUIREMENTS OF SUBPARAGRAPH (D) OF PARAGRAPH FOUR OF THIS SUBSECTION,
OR A PROFESSIONAL CORPORATION OR UNIVERSITY FACULTY PRACTICE CORPORATION THEREOF. Such coverage may be subject to annual deductibles, CO-PAYS and co-insurance as may be deemed appropriate by the superintendent and [are] SHALL BE consistent with those imposed on other benefits [within a given] UNDER THE policy. IN THE EVENT THAT A POLICY PROVIDES COVERAGE FOR BOTH INPATIENT HOSPITAL CARE AND PHYSICIAN SERVICES, THE AGGREGATE OF THE BENEFITS FOR OUTPATIENT CARE OBTAINED UNDER THIS PARAGRAPH MAY BE LIMITED TO NOT LESS THAN SIXTY VISITS IN ANY CONTRACT YEAR, PLAN YEAR OR CALENDAR YEAR. Such coverage shall not replace, restrict, or eliminate existing coverage provided by the policy. Except as otherwise provided in the applicable policy or contract, no insurer delivering a group or school blanket policy or issuing a group or school blanket policy providing coverage for alcoholism or substance abuse services pursuant to this section shall deny coverage to a family member who identifies [themself] HIMSELF OR HERSELF as a family member of a person suffering from the disease of alcoholism, substance abuse or chemical dependency and who seeks treatment as a family member who is otherwise covered by the applicable policy or contract pursuant to this section. The coverage required by this paragraph shall include treatment as a family member pursuant to such family members' own policy or contract provided such family member (i) does not exceed the allowable number of family visits provided by the applicable policy or contract pursuant to this section, and (ii) is otherwise entitled to coverage pursuant to this section and such family members' applicable policy or contract. S 3. Subsection (k) of section 4303 of the insurance law, as amended by chapter 558 of the laws of 1999, is amended to read as follows: (k) A hospital service corporation or a health service corporation which provides group, group remittance or school blanket coverage for inpatient hospital care [must make available and if requested by the contract holder] SHALL provide AS PART OF ITS CONTRACT BROAD-BASED coverage for the diagnosis and treatment of chemical abuse and chemical dependence, however defined in such policy, AT LEAST EQUAL TO THE COVER- AGE PROVIDED FOR OTHER HEALTH CONDITIONS, provided, however, that the term chemical abuse shall mean and include alcohol and substance abuse and chemical dependence shall mean and include alcoholism and substance dependence, however defined in such policy, except that this provision shall not apply to a policy which covers persons employed in more than one state or the benefit structure of which was the subject of collec- tive bargaining affecting persons who are employed in more than one state. Such coverage shall be at least equal to the following: (1) with respect to benefits for detoxification as a consequence of chemical dependence, inpatient benefits for care in a hospital or detoxification facility may not be limited to less than seven days of active treatment in any CONTRACT YEAR, PLAN YEAR OR calendar year; and (2) with respect to benefits for inpatient rehabilitation services, such benefits may not be limited to less than thirty days of inpatient rehabilitation in a hospital based or free standing chemical dependence facility in any CONTRACT YEAR, PLAN YEAR OR calendar year. Such coverage may be limited to facilities in New York state which are certified by the office of alcoholism and substance abuse services and, in other states, to those which are accredited by the joint commission on accreditation of hospi- tals as alcoholism, substance abuse, or chemical dependence treatment programs. Such coverage [shall be made available at the inception of all new policies and with respect to policies issued before the effective date of this subsection at the first annual anniversary date thereafter, without evidence of insurability and at any subsequent annual anniver-
sary date subject to evidence of insurability]
MAY BE PROVIDED ON A CONTRACT YEAR, PLAN YEAR OR CALENDAR YEAR BASIS AND SHALL BE CONSISTENT WITH THE PROVISIONS OF OTHER BENEFITS UNDER THE CONTRACT. Such coverage may be subject to annual deductibles, CO-PAYS and co-insurance as may be deemed appropriate by the superintendent and are consistent with those imposed on other benefits [within a given policy. Further, each hospital service corporation or health service corporation shall report to the superintendent each year the number of contract holders to whom it has issued policies for the inpatient treatment of chemical dependence, and the approximate number of persons covered by such policies] UNDER THE CONTRACT. Such coverage shall not replace, restrict or eliminate exist- ing coverage provided by the policy. [Written notice of the availability of such coverage shall be delivered to the group remitting agent or group contract holder prior to inception of such contract and annually thereafter, except that this notice shall not be required where a policy covers two hundred or more employees or where the benefit structure was the subject of collective bargaining affecting persons who are employed in more than one state] THE SUPERINTENDENT SHALL DEVELOP AND IMPLEMENT A METHODOLOGY TO FULLY COVER THE COST TO ANY GROUP REMITTANCE GROUP OR GROUP CONTRACT HOLDER WITH FIFTY OR FEWER EMPLOYEES WHO IS A GROUP REMITTANCE GROUP OR GROUP CONTRACT HOLDER OF A POLICY THAT IS SUBJECT TO THE PROVISIONS OF THIS SECTION FOR PROVIDING THE COVERAGE REQUIRED IN THIS SUBSECTION AND SUBSECTION (L) OF THIS SECTION. SUCH METHODOLOGY SHALL BE FINANCED FROM FUNDS FROM THE GENERAL FUND THAT SHALL BE MADE AVAILABLE TO THE SUPERINTENDENT FOR SUCH PURPOSE. S 4. Subsection (l) of section 4303 of the insurance law, as amended by chapter 565 of the laws of 2000, is amended to read as follows: (l) A hospital service corporation or a health service corporation which provides group, group remittance or school blanket coverage for inpatient hospital care [must] SHALL provide AS PART OF ITS CONTRACT coverage for at least sixty outpatient visits in any CONTRACT YEAR, PLAN YEAR OR calendar year for the diagnosis and treatment of chemical dependence of which up to twenty may be for family members, except that this provision shall not apply to a contract issued pursuant to section four thousand three hundred five of this article which covers persons employed in more than one state or the benefit structure of which was the subject of collective bargaining affecting persons who are employed in more than one state. Such coverage may be limited to facilities in New York state certified by the office of alcoholism and substance abuse services or licensed by such office as outpatient clinics or medically supervised ambulatory substance abuse programs and, in other states, to those which are accredited by the joint commission on accreditation of hospitals as alcoholism or chemical dependence substance abuse treatment programs. SUCH COVERAGE MAY BE PROVIDED ON A CONTRACT YEAR, PLAN YEAR OR CALENDAR YEAR BASIS AND SHALL BE CONSISTENT WITH THE PROVISION OF OTHER BENEFITS UNDER THE CONTRACT. Such coverage may be subject to annu- al deductibles, CO-PAYS and co-insurance as may be deemed appropriate by the superintendent and are consistent with those imposed on other bene- fits [within a given policy] UNDER THE CONTRACT. Such coverage shall not replace, restrict or eliminate existing coverage provided by the policy. Except as otherwise provided in the applicable policy or contract, no hospital service corporation or health service corporation providing coverage for alcoholism or substance abuse services pursuant to this section shall deny coverage to a family member who identifies [themself] HIMSELF OR HERSELF as a family member of a person suffering from the disease of alcoholism, substance abuse or chemical dependency
and who seeks treatment as a family member who is otherwise covered by the applicable policy or contract pursuant to this section. The coverage required by this subsection shall include treatment as a family member pursuant to such family members' own policy or contract provided such family member (i) does not exceed the allowable number of family visits provided by the applicable policy or contract pursuant to this section, and (ii) is otherwise entitled to coverage pursuant to this section and such family members' applicable policy or contract. S 5. The superintendent of financial services shall monitor the imple- mentation of the coverage required pursuant to paragraphs 6 and 7 of subsection (l) of section 3221, and subsections (k) and (l) of section 4303 of the insurance law, and take such action as may be necessary, to ensure that insurers' contracts or policies do not contain unreasonable definitions of chemical abuse, alcohol and substance abuse, chemical dependence, alcoholism and substance dependence in their contracts or policies. In determining whether such definitions may be unreasonable, the superintendent of financial services shall ensure that any exclu- sions and limitations on covered benefits are consistent with benefits provided to public officers and employees pursuant to article 11 of the civil service law. S 6. This act shall take effect on the first of January next succeed- ing the date on which it shall have become a law; and the provisions of this act shall apply to policies and contracts issued, renewed, modi- fied, altered or amended on or after such effective date.

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