Bill S5895-2013

Requires health plans with coverage of out of plan medical services to provide certain information to insureds, subscribers and enrollees

Requires health plans providing coverage for out-of-network care to provide certain information to insureds, subscribers and enrollees.

Details

Actions

  • Jan 8, 2014: REFERRED TO INSURANCE
  • Jun 19, 2013: REFERRED TO RULES

Memo

BILL NUMBER:S5895

TITLE OF BILL: An act to amend the insurance law and the public health law, in relation to requiring a health care plan which provides coverage of out of network care to provide certain information to insureds, subscribers or enrollees

PURPOSE OR GENERAL IDEA OF BILL:

To provide greater transparency and standardized disclosure of health insurance companies' out of network payment policies so that patients and employers can better understand the extent of their coverage.

SUMMARY OF SPECIFIC PROVISIONS:

Section 1 of the bill amends Section 3217-a of the Insurance Law to require all health insurance contracts; managed care health insurance contracts; or any other health insurance contract or product for which the superintendent deems appropriate to disclose to its subscribers and enrollees a description of its methodology for reimbursing health care treatment by physicians not participating in the plan's network, which shall be expressed as a percentage of the usual cost of care provided by physicians not participating in the health plan's network of providers (as determined by a nonprofit bench-marking database known as FAIR Health). Moreover, this section would also require a health insurance company to disclose to their enrollees upon request the anticipated out of pocket costs for specific health care services received on an out of network basis, which shall be based upon the difference between the estimated actual cost of the service (as determined by FAIR Health) and the health insurance company's out of network reimbursement methodology.

Section 2 of the bill empowers the Superintendent of Insurance to disapprove issuance of a health insurance policy offering coverage for out of network care that will not provide significant coverage of the usual costs of receiving care out of the plan's network.

Sections 3 and 4 of the bill makes corresponding changes in relation to the disclosure obligation to Section 4324 of the Insurance Law and Section 4409 of the Public Health Law.

JUSTIFICATION:

Some consumers and employers choose to have health insurance policies that permit them to receive care from a non-participating physician because it permits them to see the health care provider of their choice. However, this system has been fraught with problems. As a condition of settlements with the Attorney General in 2009, several health insurance companies agreed to discontinue the use of the flawed database for determining payments when patients receive care outside of a plan's network of physicians. Money was contributed toward creating a new data-base to be maintained by a new unaffiliated non-profit organization, called FAIR Health, Inc, The purpose of the database is to assure that patients, employers and health insurers have accurate information concerning the true cost of out-of-network medical services. The new database should be operational for reporting

medical charge data by the middle of 2011. This development was applauded by the consumer and provider community.

In the meantime, however, a number of insurers have changed their methodology for covering out-of-network care to methodologies that appear at first blush to cover costs adequately, but, in fact, often result in severely inadequate coverage for patients. It is the intention of this legislation to ensure that the new database developed as a result of the Attorney General's 2009 investigation and report is utilized as intended.

This legislation empowers the Superintendent of Insurance to disapprove issuance of a health insurance policy offering coverage fox out of network care that will not provide significant coverage of the usual costs of receiving care out of the plants network. It would also better assure that health insurance companies arc informing their enrollees how their coverage policies for out of network care compare to the actual cost of services. Finally, It would better protect employers and patients from purchasing policies that purport to, but in fact fail to, provide adequate coverage for out of network care.

PRIOR LEGISLATIVE HISTORY:

New Bill

FISCAL IMPLICATIONS:

None to the state

EFFECTIVE DATE:

This act shall take effect 60 days after becoming law, and apply to all policies and contracts issued, renewed, modified, altered or amended on or after such date.


Text

STATE OF NEW YORK ________________________________________________________________________ 5895 2013-2014 Regular Sessions IN SENATE June 19, 2013 ___________
Introduced by Sen. RIVERA -- read twice and ordered printed, and when printed to be committed to the Committee on Rules AN ACT to amend the insurance law and the public health law, in relation to requiring a health care plan which provides coverage of out of network care to provide certain information to insureds, subscribers or enrollees THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM- BLY, DO ENACT AS FOLLOWS: Section 1. Subsection (a) of section 3217-a of the insurance law is amended by adding a new paragraph 18 to read as follows: (18) WHERE APPLICABLE, IF THE POLICY OFFERS OUT-OF-NETWORK COVERAGE APPROVED BY THE SUPERINTENDENT PURSUANT TO SECTION THIRTY-TWO HUNDRED FORTY OF THIS ARTICLE, A DESCRIPTION OF ITS METHODOLOGY FOR REIMBURSING OUT-OF-NETWORK HEALTH CARE SERVICES WHICH SHALL BE SET FORTH AS THE PERCENTAGE OF THE USUAL AND CUSTOMARY COSTS OF OUT-OF-NETWORK HEALTH CARE SERVICES THE POLICY WILL COVER. INCLUDED WITHIN THIS DESCRIPTION SHALL BE EXAMPLES OF ANTICIPATED OUT OF PACKET COSTS FOR FREQUENTLY BILLED OUT-OF-NETWORK HEALTH CARE SERVICES PROVIDED BY VARIOUS HEALTH CARE PROVIDER SPECIALISTS. FOR THE PURPOSES OF THIS PARAGRAPH "USUAL AND CUSTOMARY COSTS OF OUT-OF NETWORK HEALTH CARE SERVICES" SHALL MEAN THE EIGHTIETH PERCENTILE OF THE ACTUAL CHARGES FOR A HEALTH CARE SERVICE PERFORMED BY AN OUT-OF-NETWORK HEALTH CARE PROVIDER IN THE SAME OR SIMI- LAR SPECIALITY, AND PROVIDED IN THE SAME ZIP CODE OR IN THE SAME GEOGRAPHICAL AREA DEFINED BY LOCALITIES WITH THE SAME FIRST THREE ZIP CODE DIGITS, AS REPORTED IN A BENCHMARKING DATABASE MAINTAINED BY A NONPROFIT ORGANIZATION WITHOUT AFFILIATION WITH AN INSURER LICENSED TO WRITE ACCIDENT AND HEALTH INSURANCE, A CORPORATION ORGANIZED PURSUANT TO ARTICLE FORTY-THREE OF THIS CHAPTER, A HEALTH MAINTENANCE ORGANIZATION CERTIFIED PURSUANT TO ARTICLE FORTY-FOUR OF THE PUBLIC HEALTH LAW, CREATED AS A RESULT OF SETTLEMENTS ENTERED INTO DURING THE YEAR TWO
THOUSAND NINE BETWEEN THE DEPARTMENT OF LAW AND INDIVIDUAL HEALTH INSUR- ANCE ORGANIZATIONS. S 2. The insurance law is amended by adding a new section 3240 to read as follows: S 3240. OUT-OF-NETWORK HEALTH CARE SERVICES. (A) A HEALTH PLAN WHICH PROVIDES COVERAGE FOR OUT-OF-NETWORK HEALTH CARE SERVICES SHALL PROVIDE TO THEIR INSUREDS, SUBSCRIBERS OR ENROLLEES A DESCRIPTION OF ITS METHOD- OLOGY FOR REIMBURSING OUT-OF-NETWORK HEALTH CARE SERVICES WHICH SHALL BE SET FORTH AS A PERCENTAGE OF THE USUAL AND CUSTOMARY COSTS OF OUT-OF-NETWORK HEALTH CARE SERVICES THE CONTRACT OR POLICY WILL COVER. THE HEALTH PLAN SHALL INCLUDE WITHIN THIS DESCRIPTION EXAMPLES OF ANTIC- IPATED OUT OF POCKET COSTS FOR FREQUENTLY BILLED OUT-OF-NETWORK HEALTH CARE SERVICES PROVIDED BY VARIOUS HEALTH CARE PROVIDER SPECIALISTS. UPON REQUEST OF AN INSURED, SUBSCRIBER OR ENROLLEE, THE HEALTH PLAN SHALL PROVIDE INFORMATION TO THE INSURED, SUBSCRIBER OR ENROLLEE IN WRITING OR THROUGH AN INTERNET WEBSITE THAT REASONABLY PERMITS THE INSURED, SUBSCRIBER OR ENROLLEE TO DETERMINE THE ANTICIPATED OUT OF PACKET COSTS FOR A SPECIFIC OUT-OF-NETWORK HEALTH CARE SERVICE BASED UPON THE DIFFER- ENCE BETWEEN THE ORGANIZATION'S METHODOLOGY FOR REIMBURSING OUT-OF-NET- WORK HEALTH CARE SERVICES AND THE USUAL AND CUSTOMARY COSTS OF OUT-OF-NETWORK HEALTH CARE SERVICES. THE SUPERINTENDENT SHALL NOT APPROVE A POLICY ISSUED BY A HEALTH PLAN THAT PROVIDES COVERAGE FOR OUT-OF-NETWORK HEALTH CARE SERVICES UNLESS THE HEALTH PLAN DEMONSTRATES THAT THE POLICY WILL PROVIDE SIGNIFICANT COVERAGE OF THE USUAL AND CUSTOMARY COSTS OF OUT-OF-NETWORK HEALTH CARE SERVICES. (B) FOR THE PURPOSES OF THIS SECTION, THE TERM: (1) "HEALTH PLAN" SHALL MEAN AN INSURER LICENSED TO WRITE ACCIDENT AND HEALTH INSURANCE, A CORPORATION ORGANIZED PURSUANT TO ARTICLE FORTY-THREE OF THIS CHAPTER, A HEALTH MAINTENANCE ORGANIZATION CERTIFIED PURSUANT TO ARTICLE FORTY-FOUR OF THE PUBLIC HEALTH LAW OR A MUNICIPAL COOPERATIVE HEALTH BENEFIT PLAN PURSUANT TO ARTICLE FORTY-SEVEN OF THIS CHAPTER; AND (2) "USUAL AND CUSTOMARY COSTS OF OUT-OF-NETWORK HEALTH CARE SERVICES" SHALL MEAN THE EIGHTIETH PERCENTILE OF THE ACTUAL CHARGES FOR A HEALTH CARE SERVICE PERFORMED BY AN OUT-OF-NETWORK HEALTH CARE PROVIDER IN THE SAME OR SIMILAR SPECIALTY, AND PROVIDED IN THE SAME ZIP CODE OR WITHIN THE SAME GEOGRAPHICAL AREA DEFINED BY LOCALITIES WITH THE SAME FIRST THREE ZIP CODE DIGITS, AS REPORTED IN A BENCHMARKING DATABASE MAINTAINED BY A NONPROFIT ORGANIZATION WITHOUT AFFILIATION WITH A HEALTH PLAN, CREATED AS A RESULT OF SETTLEMENTS ENTERED INTO DURING THE YEAR TWO THOUSAND NINE BETWEEN THE DEPARTMENT OF LAW AND INDIVIDUAL HEALTH INSUR- ANCE ORGANIZATIONS. S 3. Subsection (a) of section 4324 of the insurance law is amended by adding a new paragraph 19 to read as follows: (19) WHERE APPLICABLE, IF THE CONTRACT INCLUDES OUT OF NETWORK COVER- AGE APPROVED BY THE SUPERINTENDENT PURSUANT TO SECTION THIRTY-TWO HUNDRED FORTY OF THIS CHAPTER, A DESCRIPTION OF THE METHODOLOGY FOR REIMBURSING OUT-OF-NETWORK HEALTH CARE SERVICES WHICH SHALL BE SET FORTH AS THE PERCENTAGE OF THE USUAL AND CUSTOMARY COSTS OF OUT-OF-NETWORK HEALTH CARE SERVICES THE CONTRACT WILL COVER. INCLUDED WITHIN THIS DESCRIPTION SHALL BE EXAMPLES OF ANTICIPATED OUT OF POCKET COSTS FOR FREQUENTLY BILLED OUT-OF-NETWORK HEALTH CARE SERVICES PROVIDED BY VARI- OUS HEALTH CARE PROVIDER SPECIALISTS. FOR THE PURPOSES OF THIS PARAGRAPH "USUAL AND CUSTOMARY COSTS OF OUT-OF-NETWORK HEALTH CARE SERVICES" SHALL MEAN THE EIGHTIETH PERCENTILE OF THE ACTUAL CHARGES FOR A HEALTH CARE SERVICE PERFORMED BY AN OUT-OF-NETWORK HEALTH CARE PROVIDER IN THE SAME
OR SIMILAR SPECIALTY, AND PROVIDED IN THE SAME ZIP CODE OR WITHIN THE SAME GEOGRAPHICAL AREA DEFINED BY LOCALITIES WITH THE SAME FIRST THREE ZIP CODE DIGITS, AS REPORTED IN A BENCHMARKING DATABASE MAINTAINED BY A NONPROFIT ORGANIZATION WITHOUT AFFILIATION WITH AN INSURER LICENSED TO WRITE ACCIDENT AND HEALTH INSURANCE, A CORPORATION ORGANIZED PURSUANT TO THIS ARTICLE, OR A HEALTH MAINTENANCE ORGANIZATION CERTIFIED PURSUANT TO ARTICLE FORTY-FOUR OF THE PUBLIC HEALTH LAW, CREATED AS A RESULT OF SETTLEMENTS ENTERED INTO DURING THE YEAR TWO THOUSAND NINE BETWEEN THE DEPARTMENT OF LAW AND INDIVIDUAL HEALTH INSURANCE ORGANIZATIONS. S 4. Subdivision 1 of section 4408 of the public health law is amended by adding a new paragraph (s) to read as follows: (S) WHERE APPLICABLE, IF THE CONTRACT INCLUDES OUT OF NETWORK COVERAGE APPROVED BY THE SUPERINTENDENT PURSUANT TO SECTION THIRTY-TWO HUNDRED FORTY OF THE INSURANCE LAW, A DESCRIPTION OF THE METHODOLOGY FOR REIM- BURSING OUT-OF-PLAN HEALTH CARE SERVICES WHICH SHALL BE SET FORTH AS THE PERCENTAGE OF THE USUAL AND CUSTOMARY COSTS OF OUT-OF-NETWORK HEALTH CARE SERVICES THE CONTRACT WILL COVER. INCLUDED WITHIN THIS DESCRIPTION SHALL BE EXAMPLES OF ANTICIPATED OUT OF POCKET COSTS FOR FREQUENTLY BILLED OUT-OF-PLAN HEALTH CARE SERVICES PROVIDED BY VARIOUS HEALTH CARE PROVIDER SPECIALISTS. FOR THE PURPOSES OF THIS PARAGRAPH, "USUAL AND CUSTOMARY COSTS OF OUT-OF-NETWORK HEALTH CARE SERVICES" SHALL MEAN THE EIGHTIETH PERCENTILE OF THE ACTUAL CHARGES FOR A HEALTH CARE SERVICE PERFORMED BY AN OUT-OF-PLAN HEALTH CARE PROVIDER IN THE SAME OR SIMILAR SPECIALTY, AND PROVIDED IN THE SAME ZIP CODE OR WITHIN THE SAME GEOGRAPHICAL AREA DEFINED BY LOCALITIES WITH THE SAME FIRST THREE ZIP CODE DIGITS, AS REPORTED IN THE BENCHMARKING DATABASE MAINTAINED BY A NONPROFIT ORGANIZATION WITHOUT AFFILIATION WITH AN ORGANIZATION CERTI- FIED UNDER THIS ARTICLE OR AN INSURER OR CORPORATION LICENSED UNDER THE INSURANCE LAW, CREATED AS A RESULT OF SETTLEMENTS ENTERED INTO DURING THE YEAR TWO THOUSAND NINE BETWEEN THE DEPARTMENT OF LAW AND INDIVIDUAL HEALTH INSURANCE ORGANIZATIONS. S 5. This act shall take effect on the sixtieth day after it shall have become a law and shall apply to all policies and contracts issued, renewed, modified, altered or amended on or after such date.

Comments

Open Legislation comments facilitate discussion of New York State legislation. All comments are subject to moderation. Comments deemed off-topic, commercial, campaign-related, self-promotional; or that contain profanity or hate speech; or that link to sites outside of the nysenate.gov domain are not permitted, and will not be published. Comment moderation is generally performed Monday through Friday.

By contributing or voting you agree to the Terms of Participation and verify you are over 13.

Discuss!

blog comments powered by Disqus