Bill S2934-2013

Relates to a medical assistance information and payment system

Relates to a medical assistance information and payment system; directs the department of health to issue a request for proposal for the purpose of providing the system within 90 days.



  • Jan 8, 2014: REFERRED TO HEALTH
  • Jan 25, 2013: REFERRED TO HEALTH



TITLE OF BILL: An act to amend the social services law, in relation to a medical assistance information and payment system

PURPOSE: To provide a more cost effective and efficient method to determine the third party eligibility of Medicaid claims for prescription drugs, while at the same time generating hundreds of millions of dollars for New York State taxpayers.


Section one of the bill directs the Department of Health to implement an initiative establishing an automated real time prospective pre claims payment review process.

Section two of the bill directs the Department to issue an RFP within ninety days of the effective date.

Section three of the bill provides for an immediate effective date.

JUSTIFICATION: Under the existing system, Medicaid provides initial coverage for prescription drugs and later determines a patient's eligibility for third party insurer coverage. Medicaid must then process and recover claims from the third party insurers. Under the system established by this bill, third party eligibility determinations would be made electronically at the time of purchase, thereby avoiding the need for payment and recovery.

This technology has been developed and would transition New York State's Medicaid pharmacy program from a "pay and chase" model to a "cost avoidance" model. The eligibility and correct payer information could be determined at the point of sale using secure industry standard transactions and communicating the information to the pharmacy in real-time, eliminating pharmacy "pay and chase". The system would be supported by an experienced call center application and staff. The plan can be implemented in 120 to 150 days.

LEGISLATIVE HISTORY: 2012: S.379 Hannon 2011: S.379 Hannon 2010: S.7520 Hannon/A.8909 Destito

FISCAL IMPLICATIONS: Annual savings for New York. State Medicaid are expected to range from $180 million to $360 million.

EFFECTIVE DATE: This act shall take effect immediately.


STATE OF NEW YORK ________________________________________________________________________ 2934 2013-2014 Regular Sessions IN SENATE January 25, 2013 ___________
Introduced by Sens. HANNON, RANZENHOFER -- read twice and ordered print- ed, and when printed to be committed to the Committee on Health AN ACT to amend the social services law, in relation to a medical assistance information and payment system THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM- BLY, DO ENACT AS FOLLOWS: Section 1. Subparagraph 2 of paragraph (b) of subdivision 8 of section 367-b of the social services law, as amended by chapter 109 of the laws of 2007, is amended to read as follows: (2) Coordination of benefits. Develop, test and implement an automated process to improve the coordination of benefits between the medical assistance program and other sources of coverage for medical assistance recipients. Such initiative shall initially examine the savings poten- tial to the medical assistance program through retrospective review of claims paid which shall be completed not later than January thirty- first, two thousand seven. If, based upon such initial experience, the Medicaid inspector general deems the automated process to be capable of including or moving to a prospective review, with negligible effect on the turnaround of claims for provider payment or on recipient access to services, then the Medicaid inspector general in subsequent tests shall examine the savings potential through prospective, pre-claims payment review. PROVIDED, HOWEVER, THAT THE DEPARTMENT OF HEALTH SHALL IMPLE- MENT AN INITIATIVE ESTABLISHING AN AUTOMATED REAL TIME PROSPECTIVE PRE- CLAIMS PAYMENT REVIEW PROCESS, INCLUDING, BUT NOT LIMITED TO, A PRIOR PHARMACY AUTHORIZATION AND PRE-PHARMACY CLAIMS REVIEW OF ALTERNATIVE INSURANCE COVERAGE PROGRAM, PROVIDED HOWEVER THAT ANY SUCH INITIATIVE HAS MINIMAL INITIAL COSTS TO THE DEPARTMENT OF HEALTH. ANY INITIATIVE IMPLEMENTED BY THE DEPARTMENT OF HEALTH SHALL HAVE A NEGLIGIBLE EFFECT ON THE TURNAROUND OF CLAIMS FOR PROVIDER PAYMENT OR ON RECIPIENT ACCESS TO SERVICES AND DEMONSTRATE SAVINGS POTENTIAL.
S 2. The department of health shall issue a request for proposals for the purpose of providing the system described in subparagraph (2) of paragraph (b) of subdivision 8 of section 367-b of the social services law, as amended by section one of this act, within 90 days of the effec- tive date of this act. Bids from qualified vendors shall be received by the department of health no later than 60 days following the issuance of the request for proposals. Any contract issued pursuant to this section shall be issued within 90 days following receipt of bids and installa- tion of such system completed by the successful bidder within 180 days of the issuance of such contract. S 3. This act shall take effect immediately.


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