S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   2903
 
                        2019-2020 Regular Sessions
 
                           I N  A S S E M B L Y
 
                             January 28, 2019
                                ___________
 
 Introduced  by M. of A. QUART -- read once and referred to the Committee
   on Insurance
 
 AN ACT to amend the  insurance  law,  in  relation  to  registration  of
   office-based surgery facilities and payments for the use thereof
 
   THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
 BLY, DO ENACT AS FOLLOWS:

   Section 1. Legislative intent. The legislature hereby finds  that  New
 York  state  is  home  to approximately 1,000 accredited physician-owned
 ambulatory surgery facilities, referred to as Office-Based Surgery (OBS)
 practices, currently providing patient access to virtually all types  of
 covered  outpatient  surgical  procedures  safely  and  at  a lower cost
 compared to other settings,  including  traditional  ambulatory  surgery
 centers and hospitals.
   The  legislature  further  finds  that advances in medicine, including
 surgical techniques, equipment and  improvements  in  anesthesia  enable
 procedures to be performed safely, conveniently and at a much lower cost
 in  an office-based setting. In fact, conservative estimates show physi-
 cian-owned ambulatory surgery facilities can  achieve  cost  savings  of
 30%-40%  as  compared with other settings. The enviable safety record of
 the accredited OBS industry is also well established.
   The legislature also finds that like many states, New York is  experi-
 encing  a  growing  physician  shortage.  The  problem is compounded for
 accredited office-based surgery facilities and the patients  they  treat
 by  the  recent  refusal on the part of many third party payers to reim-
 burse facility costs for covered procedures. These expenses are substan-
 tial and include capital costs, equipment usage, supplies and  overhead.
 The  motives behind these denials are inexplicable given that this venue
 represents the lowest-cost provider. In fact, it was not long  ago  that
 insurers  were consistently reimbursing OBS practices for their facility
 costs. Practitioners invested in  their  practices  dependent  on  these
 established reimbursement practices.  Without the mechanism to negotiate
 with the payers, these mostly small or solo practices lack the clout and
 market  power to negotiate and convince insurers to reinstate reimburse-
 ment.
              

 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
                                                            LBD01352-01-9

 A. 2903                             2
 
   The legislature also finds that lack of reimbursement has driven  many
 physician  owned  ambulatory  surgery  practices out of the market. Many
 more are likely to follow resulting in thousands of lost jobs, decreased
 access to care and substantially higher costs to patients and the  over-
 all healthcare delivery system.
   The  legislature  further  finds that while office-based surgery prac-
 tices are recognized in statute pursuant to the  accreditation  require-
 ments  in  section  230-d  of the public health law, there is nothing in
 current law  or  regulations  that  specifically  identifies  accredited
 office-based  surgery entities as facilities entitled to seek reimburse-
 ment for facility related costs.
   Therefore, the legislature hereby declares that, due to  the  integral
 role  that  accredited  office-based surgery practices play in the safe,
 efficient and low-cost delivery of surgical services,  as  well  as  the
 need to protect and enhance patient safety and access to affordable care
 for  all  New Yorkers, it is in the interest of the people of this state
 to further enhance recognition of accredited office-based surgery  prac-
 tice  and protect and encourage a robust and successful industry in this
 state.
   § 2. Clause (i) of subparagraph (A) of paragraph 1 of  subsection  (e)
 and  subsection  (g) of section 4900 of the insurance law, as amended by
 chapter 558 of the laws of 1999, are amended to read as follows:
   (i) provided by a facility licensed, CERTIFIED OR ACCREDITED  pursuant
 to  SECTION  TWO  HUNDRED  THIRTY-D,  article  twenty-eight, thirty-six,
 forty-four or forty-seven of the public health law or pursuant to  arti-
 cle  nineteen,  [twenty-three,]  thirty-one  or thirty-two of the mental
 hygiene law; or
   (g) "Health care provider" means  a  health  care  professional  or  a
 facility  licensed,  CERTIFIED  OR  ACCREDITED  pursuant  to SECTION TWO
 HUNDRED  THIRTY-D,  article  twenty-eight,  thirty-six,  forty-four   or
 forty-seven of the public health law or a facility licensed OR CERTIFIED
 pursuant  to  article nineteen, [twenty-three,] thirty-one or thirty-two
 of the mental hygiene law.
   § 3. Paragraph 2 of subsection (b) of section 4901  of  the  insurance
 law,  as added by chapter 705 of the laws of 1996, is amended to read as
 follows:
   (2) Those circumstances, if any, under which utilization review may be
 delegated to a  utilization  review  program  conducted  by  a  facility
 licensed,  CERTIFIED OR ACCREDITED pursuant to SECTION TWO HUNDRED THIR-
 TY-D OR article twenty-eight of the public health  law  or  pursuant  to
 article thirty-one of the mental hygiene law;
   §  4. Subsection (b) of section 4906 of the insurance law, as added by
 chapter 237 of the laws of 2009, is amended to read as follows:
   (b) Notwithstanding subsection (a) of this section,  in  lieu  of  the
 external appeal process as set forth in this article, a health care plan
 and a facility licensed, CERTIFIED OR ACCREDITED pursuant to SECTION TWO
 HUNDRED  THIRTY-D  OR  article twenty-eight of the public health law may
 agree to an alternative dispute resolution mechanism to resolve disputes
 otherwise subject to this article.
   § 5. This act shall take effect immediately and  shall  be  deemed  to
 have  been  in  full force and effect on and after January 18, 2009 with
 respect to claims and appeals filed for health care services provided at
 facilities subject to the provisions of  section  230-d  of  the  public
 health  law during the period of time which such facilities remain fully
 licensed, certified or accredited pursuant to such section.