Actions

Memo

BILL NUMBER:S5027

TITLE OF BILL: An act to amend the insurance law, in relation to provider credentialing

PURPOSE: The purpose of this bill is to permit newly licensed providers, providers moving to New York State, or a physician who has changed their corporate relationship such that it results in the issuance of a new tax identification number under which their services are billed for, who are employed by licensed Article 28 facilities and have applied to be credentialed as part of a health plan's provider network to be considered provisionally credentialed from the date of application.

SUMMARY OF PROVISIONS: Section 1 of the bill amends subsection (a) of Section 4803 of the insurance law by adding a new paragraph (3) that provides that newly licensed health care professionals, health care professionals that have recently relocated to the state or a physician who has changed their corporate relationship such that it results in the issuance of a new tax identification number under which their services are billed for, who are employed by a licensed Article 28 facility whose other employed health care professionals participate in the in-network portion of a health plan's network shall be considered provisionally credentialed from the date of application.

Section 2 is the effective date

EXISTING LAW: The latest of the managed care reform laws (Chapter 237 of the Laws of 2009) provided that newly licensed health care professionals or health care professionals that recently relocated to New York State who joined a group practice of health care professionals and have applied to be credentialed as part of the in-network of a health plan's network are considered provisionally credentialed if their application is not approved or denied with 90 days from the date of application.

JUSTIFICATION: The model of care delivery is gradually shifting from a physician private practice model to a model of hospital or health system employed physicians. In order to recruit and retain physicians and physician extenders, upstate hospitals in a market of increasing physician shortage have been forced to be at the forefront of this shifting model of care. However, faced with increasingly constrained revenue from Medicare and Medicaid cuts and commercial health plans, hospitals, who most often lose money on physicians services component of care even with full payment, cannot carry afford to can-y a physician on salary for 90 days without reimbursement for their services nor based on the physician shortage can they afford to be without the services of these physicians.

Hospitals as licensed and regulated Article 28 facilities are statutorily required to credential any provider before extending

 admitting privileges or allowing the professional to provide care within the facility. According to both hospitals and health plan administrators it is almost unheard of for a hospital itself to employ any physician who would be unsuitable for health plan credentialing.

Furthermore, should this rare circumstance actually occur, hospitals most often have a longstanding contractual relationships with the principal health plans in their service areas and there exists an adequate flow of payments between the health plans and the hospital, to allow the health plan to recoup any payments made to the hospitals for the services provided by any health professional that is ultimately not credentialed as is provided for in the legislation.

LEGISLATIVE HISTORY: New Bill.

FISCAL IMPLICATIONS: None

LOCAL FISCAL IMPLICATIONS: None.

EFFECTIVE DATE: This bill is effective ninety days after which it shall have become law, and applies to applications submitted after that date, and shall not apply submitted prior to such date if such application is resubmitted in substantially similar form on or after the date on which this act shall have become law.

Text

STATE OF NEW YORK
________________________________________________________________________

5027

2011-2012 Regular Sessions

IN SENATE

May 2, 2011
___________

Introduced  by  Sen.  SEWARD -- 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 provider credentialing

  THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section  1.  Subsection  (a)  of  section 4803 of the insurance law is
amended by adding a new paragraph 3 to read as follows:
  (3) A NEWLY-LICENSED HEALTH CARE PROFESSIONAL, A HEALTH  CARE  PROFES-
SIONAL  WHO  HAS RECENTLY RELOCATED TO THIS STATE FROM ANOTHER STATE AND
HAS NOT PREVIOUSLY PRACTICED IN THIS  STATE,  OR  A  PHYSICIAN  WHO  HAS
CHANGED  THEIR  CORPORATE RELATIONSHIP SUCH THAT IT RESULTS IN THE ISSU-
ANCE OF A NEW TAX IDENTIFICATION NUMBER UNDER WHICH THEIR  SERVICES  ARE
BILLED  FOR,  WHO IS EMPLOYED BY A GENERAL HOSPITAL LICENSED PURSUANT TO
ARTICLE TWENTY-EIGHT OF THE PUBLIC  HEALTH  LAW,  WHOSE  OTHER  EMPLOYED
HEALTH  CARE  PROFESSIONALS  PARTICIPATE IN THE IN-NETWORK PORTION OF AN
INSURER'S NETWORK, SHALL BE DEEMED "PROVISIONALLY CREDENTIALED" UPON THE
PLAN'S RECEIPT OF THE COMPLETED APPLICATION, AND MAY PARTICIPATE IN  THE
IN-NETWORK  PORTION  OF  AN INSURER'S NETWORK; PROVIDED, HOWEVER, THAT A
PROVISIONALLY  CREDENTIALED  PHYSICIAN  MAY  NOT  BE  DESIGNATED  AS  AN
INSURED'S  PRIMARY  CARE  PHYSICIAN UNTIL SUCH TIME AS THE PHYSICIAN HAS
BEEN FULLY CREDENTIALED BY THE PLAN.  A HEALTH CARE  PROFESSIONAL  SHALL
ONLY  BE  ELIGIBLE FOR PROVISIONAL CREDENTIALING IF THE GENERAL HOSPITAL
LICENSED PURSUANT TO ARTICLE TWENTY-EIGHT OF THE PUBLIC HEALTH LAW  WITH
WHICH  HE  OR  SHE  IS EMPLOYED NOTIFIES THE INSURER IN WRITING THAT THE
HEALTH CARE PROFESSIONAL HAS BEEN GRANTED  HOSPITAL  PRIVILEGES    AFTER
MEETING  THE  REQUIREMENTS OF SECTION TWENTY-EIGHT HUNDRED FIVE-K OF THE
PUBLIC HEALTH LAW AND, SHOULD THE APPLICATION ULTIMATELY BE DENIED,  THE
LICENSED  GENERAL  HOSPITAL:  (A)  SHALL REFUND ANY PAYMENTS MADE BY THE
INSURER FOR IN-NETWORK SERVICES PROVIDED BY  THE  PROVISIONALLY  CREDEN-
TIALED  HEALTH CARE PROFESSIONAL THAT EXCEED ANY OUT-OF-NETWORK BENEFITS
PAYABLE UNDER THE INSURED'S CONTRACT WITH THE INSURER; AND (B) SHALL NOT

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD11200-01-1
S. 5027                             2

PURSUE REIMBURSEMENT FROM THE INSURED, EXCEPT TO COLLECT  THE  COPAYMENT
OR  COINSURANCE  THAT  OTHERWISE WOULD HAVE BEEN PAYABLE HAD THE INSURED
RECEIVED SERVICES FROM A HEALTH CARE PROFESSIONAL PARTICIPATING  IN  THE
IN-NETWORK PORTION OF AN INSURER'S NETWORK.
  S  2.  This  act shall take effect on the ninetieth day after it shall
have become a law, and shall apply to applications submitted after  such
date and shall not apply to applications submitted prior to such date if
such  application  is  resubmitted  in  substantially similar form on or
after the effective date of this act.