Source: https://www.nysenate.gov/legislation/bills/2017/s5044/amendment/original
Timestamp: 2019-02-22 23:47:05
Document Index: 106042245

Matched Legal Cases: ['Art 49', '§4920', '§  2', '§ 3', '§  4921', '§ 4922', '§ 4923', '§  4924', '§  4926', '§  4927', '§ 4928', '§  4929', '§ 4']

Enacts the "health care consumer and provider protection act"
Add Art 49 Title 3 §§4920 - 4929, Pub Health L
Enacts the "health care consumer and provider protection act" to provide for collective negotiations by health care providers with health care plans in the counties of Nassau and Suffolk.
BILL NUMBER:  S5044
to requirements for collective negotiations by health care providers
with certain health benefit plans in certain counties; and providing
This bill would create a demonstration program to study whether
physician collective negotiations can restore fairness to the
contracting practice between physicians and large managed care plans.
This legislation would not authorize strikes of health benefit plans
Section one provides a statement of legislative intent.
Section two provides that this act shall be known and may be cited as
the "Health Care Consumer and Provider Protection Act".
Section three amends article 49 of the Public Health Law by adding a
new title III relating to requirements for collective negotiations by
health care providers with certain health benefit plans in certain
counties and providing for the repeal of such provisions upon
Section four provides that the Department of Health in consultation
with the Department of Financial Services shall prepare or shall
arrange for the preparation of a report on the implementation of the
Section five provides the effective date and repealer five years after
New York State is following an alarming national trend - the slow
extinction of the independent health care provider, which includes the
neighborhood doctor. The professionalism of medicine has been eroded
over the past decade as managed care plans have imposed more
restrictions and requirements on physicians, reduced payments to
practices and shifted more costs onto patients in the form of higher
co-pays, deductibles and premiums. The significant administrative
burdens imposed upon physicians by plans and reduced compensation has
forced physicians to spend less and less time with patients,
undermining the intimate physician-patient relationship, which once
comprised the essence of medicine.  Independent physicians are not in
a position to negotiate, because the playing field is heavily tilted
in favor of the health plans, which has and does dictate terms.
Consequently, physicians are powerless to protect their relationship
with the patients they care for.
Further, the American Medical Association reported that younger
physicians were more than twice as likely as their older counterparts
to be employed by hospitals. This illustrates that new doctors
entering the field are cognizant of the challenges that face their
older peers and as such, are choosing not to open their own practice.
A 2015 national report by Marrit Hawkins, a global health care
consultancy and major health care employee recruitment firm,
highlights the increasing trend of physicians choosing to work as a
salaried hospital or mega-group employee rather than start or continue
an independent practice. Approximately 95% of search assignments now
feature an employed setting, compared to less than 50% in 2004. The
report also points to reasons behind the trend of in-practice
physicians moving into an employed setting, by stating, "given recent
declines in reimbursement, escalating practice costs, and a high level
of administrative responsibilities, many in-practice physicians are
migrating away from independent practice and towards hospital
Additionally, in a 2015 Accenture report entitled "The Doctor Will NOT
See You Now", the number of independent physicians nationwide has been
dramatically reduced by 57% since the year 2000. Accenture's report
reveals that a major reason for this reduction, based on interviews
with doctors, are the inability of doctors to negotiate contract terms
with private managed care plans. A direct result of this imbalance of
negotiating power in favor of the managed care plans, independent
doctors, and other health care providers are offered
take-it-or-leave-it contracts by health plans that significantly
impede their ability to provide quality patient care.
A PROPOSAL TO PROTECT PATIENT RIGHTS AND FAIR AND EQUITABLE PHYSICIAN
collectively negotiating any provisions of private contracts they sign
with managed care entities. However, based on a 1943 Supreme Court
decision, interpreted as the State Action Doctrine, grants the states
an exemption from anti-trust regulations paving the way for physicians
to collectively negotiate under "strict state supervision". Recently,
the Supreme Court upheld this position on state sovereignty in North
Carolina State Board of Dental Examiners v. Federal Trade Commission,
135 S.C. 1101 (2015), where it ruled that the state is immune from
anti-trust laws, if that state institutes a policy and strictly
oversees the collective negotiations. This legislative proposal is
consistent with that precedent.
This proposal would create a demonstration program authorizing
physicians in two New York State counties, Nassau and Suffolk, located
on Long Island, to collectively negotiate with managed care plans by
allowing independent physicians to conduct said negotiations while
being closely monitored by the state. Previous legislation introduced
in past years was statewide in nature and were opposed, because of the
statewide problem of dealing with so many regional areas.  By
confining this legislation to two distinct areas, it was felt that its
scope would be a realistic test case.
Nassau County, which borders Suffolk to the east and Queens County to
the West, is densely populated with over 1.3 million residents living
within 453 square miles. Nassau is considered a suburban community.
However, given its density and close proximity to New York City, it
has many urban elements. Suffolk County has an estimated population of
over 1.5 million people. It is the state's second largest county
encompassing 2,373 square miles, which includes a large agricultural
region on its east end, comparable to many regions in upstate New
York. Its geographic diversity makes its inclusion in this
demonstration program a logical approach. These two counties are
representative of a cross section of the rural, suburban and urban
communities found throughout New York State.
This legislative proposal would allow physicians in the two counties
to conduct collective negotiations by creating a system under which
Giving the independent physician a greater ability to advocate for
patients in contract negotiations is critical since large health
maintenance organizations control huge shares of the health insurance
market, both in New York and across the country. This proposal seeks
to create a fair and equitable process for doctors and patients when
dealing with managed care plans. Currently, these take-it-or-leave-it
contracts permit bureaucratic processes and unjustifiably long wait
times for patients seeking to obtain pre-authorization for a medical
service; impose limitations on whom a physician may refer a patient
for necessary care; permit demands for refunds of payments long after
the time that such payments were originally made; permit health plans
to make major changes to key elements of a contract without physician
consent; and cede to physicians the legal consequences for patients
harmed by health plan utilization review decisions.
This proposal does not seek to create an additional cost burden on the
patient. In fact, a Journal of the American Medical Association study
points out, patients and managed care plans may be paying up to 20
percent more if that physician sells his or her practice to a
multi-hospital system versus the cost expended by an independent
doctor for equivalent services. Insurance premiums in New York have
increased consistently, absent collective bargaining rights for
physicians. There is no evidence to support a direct relationship
between collective bargaining and increased premiums. In fact, the
current provider reimbursement rates are calculated arbitrarily based
on the size of the provider's network - a practice that has been
substantiated by the Federal Trade Commission. When plans negotiate
separately with large groups they tend to agree on reimbursement fees
that are much higher than the plans pay to individual physicians and
small group practices.
Patients deserve to have a choice of which doctor treats them. Whether
the physician works independently or for a hospital, the physician
practice should not be discriminated against based on its size. Unless
New York State intervenes, the family physician as we know it will
years after it shall take effect; provided that the commissioner of
health is authorized to promulgate any and all rules and regulations
and take any other measures necessary to implement this act on its
benefit plans in certain counties; and providing  for  the  repeal  of
health plan provider agreements and authorize collective negotiations on
the terms and conditions of the relationship between health  care  plans
and  health  care  providers  so the imbalances between the two will not
apply to or affect in any respect  collective  bargaining  relationships
involving  health  care  providers,  as  defined  in section 4920 of the
public health law or rights relating to  collective  bargaining  arising
under applicable federal or state collective bargaining statutes.
§  2.  Short  title.   This act shall be known and may be cited as the
"health care consumer and provider protection act".
§ 3. Article 49 of the public health law is amended by  adding  a  new
LBD10367-01-7
PROVIDER) THAT APPROVES, PROVIDES, ARRANGES FOR OR PAYS FOR HEALTH  CARE
SERVICES  IN  THE  DEMONSTRATION SERVICE AREA, INCLUDING BUT NOT LIMITED
2. "PERSON" MEANS AN INDIVIDUAL, ASSOCIATION, CORPORATION OR ANY OTHER
4.  "STRIKE"  MEANS  A  WORK  STOPPAGE, IN PART OR IN WHOLE, DIRECT OR
INDIRECT, BY A BODY OF WORKERS TO GAIN COMPLIANCE WITH DEMANDS  MADE  ON
CARE PLAN'S MARKET SHARE OF A BUSINESS  LINE  WITHIN  THE  DEMONSTRATION
SERVICE  AREA  AS APPROVED BY THE COMMISSIONER, IN CONSULTATION WITH THE
SUPERINTENDENT OF FINANCIAL SERVICES, ALONE OR IN COMBINATION  WITH  THE
MARKET  SHARES  OF  AFFILIATES,  EXCEEDS EITHER TEN PERCENT OF THE TOTAL
NUMBER OF COVERED LIVES IN THAT SERVICE AREA FOR SUCH BUSINESS  LINE  OR
THE  SERVICES OF THE PROVIDERS SEEKING TO COLLECTIVELY NEGOTIATE SIGNIF-
ICANTLY EXCEEDS THE COUNTERVAILING MARKET SHARE OF THE PROVIDERS  ACTING
PROVIDER IN THE DEMONSTRATION SERVICE AREA. A HEALTH CARE PROVIDER UNDER
TITLE EIGHT OF THE EDUCATION LAW WHO  PRACTICES  AS  AN  EMPLOYEE  OF  A
7. "DEMONSTRATION SERVICE AREA" SHALL INCLUDE THE COUNTIES  OF  NASSAU
§  4921.  NON-FEE RELATED COLLECTIVE NEGOTIATION AUTHORIZED. 1. HEALTH
AND COMMUNICATE FOR THE  PURPOSE  OF  COLLECTIVELY  NEGOTIATING  WITH  A
THE HEALTH CARE PLAN; AND
(P) RULES REGARDING RETROSPECTIVE AUDITS.
§ 4922. FEE RELATED COLLECTIVE NEGOTIATION. 1. HEALTH  CARE  PROVIDERS
PRACTICING  WITHIN THE DEMONSTRATION SERVICE AREA MAY COLLECTIVELY NEGO-
S. 5044                             4
TIATE THE FOLLOWING TERMS AND CONDITIONS RELATING TO THAT BUSINESS  LINE
WITH THE HEALTH CARE PLAN:
2. NOTHING IN THIS SECTION SHALL BE DEEMED  TO  AFFECT  OR  LIMIT  THE
COLLECTIVELY PETITION A GOVERNMENT ENTITY FOR A CHANGE IN A LAW, RULE OR
§ 4923. COLLECTIVE NEGOTIATION REQUIREMENTS. 1. COLLECTIVE NEGOTIATION
RIGHTS GRANTED BY THIS TITLE SHALL CONFORM  TO  THE  FOLLOWING  REQUIRE-
2.  A  HEALTH  CARE PROVIDERS' REPRESENTATIVE SHALL NOT REPRESENT MORE
THAN THIRTY PERCENT OF THE MARKET OF  HEALTH  CARE  PROVIDERS  OR  OF  A
PARTICULAR  HEALTH  CARE  PROVIDER  TYPE  OR SPECIALTY PRACTICING IN THE
DEMONSTRATION SERVICE AREA.
§  4924.  REQUIREMENTS  FOR  HEALTH CARE PROVIDERS' REPRESENTATIVE. 1.
2. BEFORE ENGAGING IN  THE  COLLECTIVE  NEGOTIATIONS,  A  HEALTH  CARE
PROVIDERS' REPRESENTATIVE SHALL ALSO SUBMIT TO THE COMMISSIONER, FOR THE
S. 5044                             5
COMMISSIONER'S  APPROVAL,  A  REPORT  IDENTIFYING  THE  PROPOSED SUBJECT
MATTER OF THE NEGOTIATIONS OR DISCUSSIONS WITH THE HEALTH CARE PLAN  AND
THE EFFICIENCIES OR BENEFITS EXPECTED TO BE ACHIEVED THROUGH THE NEGOTI-
COMMISSIONER SHALL NOT APPROVE THE REPORT IF HE OR SHE, IN  CONSULTATION
WITH  THE  SUPERINTENDENT  OF  FINANCIAL  SERVICES,  DETERMINES THAT THE
PROPOSED NEGOTIATIONS WOULD EXCEED  THE  AUTHORITY  GRANTED  UNDER  THIS
ON A REGULAR BASIS OR AS NEW INFORMATION BECOMES AVAILABLE, IN THE EVENT
IT CHANGES OR WILL CHANGE THE SUBJECT MATTER OF  THE  NEGOTIATIONS  WITH
THE  HEALTH  CARE PLAN.  IN NO EVENT SHALL THE REPORT BE LESS THAN EVERY
4. WITH THE ADVICE OF THE SUPERINTENDENT OF  FINANCIAL  SERVICES,  THE
COMMISSIONER  SHALL  APPROVE OR DISAPPROVE THE REPORT NOT LATER THAN THE
TWENTIETH DAY AFTER THE DATE ON WHICH THE REPORT  IS  FILED.  IF  DISAP-
PROVED,  THE  COMMISSIONER  SHALL  FURNISH  A WRITTEN EXPLANATION OF ANY
DEFICIENCIES, ALONG WITH A STATEMENT OF SPECIFIC PROPOSALS FOR  REMEDIAL
MEASURES  TO  CURE THE DEFICIENCIES. IF THE COMMISSIONER DOES NOT SO ACT
PLAN,  THE  HEALTH  CARE  PROVIDERS' REPRESENTATIVE SHALL FURNISH TO THE
COMMISSIONER A COPY OF ALL MEMORANDUMS AND MEETING MINUTES PERTAINING TO
NEGOTIATIONS IN RELATION TO THE HEALTH CARE PROVIDER.
7. A HEALTH CARE PROVIDERS' REPRESENTATIVE SHALL  REPORT  THE  END  OF
NEGOTIATIONS OR FAILING TO RESPOND TO A REQUEST FOR NEGOTIATION. IN SUCH
INSTANCES,  A  HEALTH  CARE PROVIDERS' REPRESENTATIVE MAY REQUEST INTER-
VENTION FROM THE COMMISSIONER TO REQUIRE THE HEALTH CARE PLAN TO PARTIC-
IPATE IN THE NEGOTIATION PURSUANT TO SUBDIVISION EIGHT OF THIS SECTION.
IN THE NEGOTIATIONS, OR IN THE EVENT A  HEALTH  CARE  PLAN  DECLINES  TO
NEGOTIATE,  CANCELS  NEGOTIATIONS  OR  FAILS TO RESPOND TO A REQUEST FOR
(I) TO ASSIST THE PARTIES TO EFFECT  A  VOLUNTARY  RESOLUTION  OF  THE
NEGOTIATIONS,  THE  COMMISSIONER SHALL APPOINT A MEDIATOR FROM A LIST OF
QUALIFIED PERSONS MAINTAINED BY THE COMMISSIONER.  IF  THE  MEDIATOR  IS
SUCCESSFUL  IN  RESOLVING  THE  IMPASSE, THEN THE HEALTH CARE PROVIDERS'
REPRESENTATIVE SHALL PROCEED AS SET FORTH IN THIS ARTICLE; AND
(II) IF AN IMPASSE CONTINUES, THE COMMISSIONER SHALL APPOINT  A  FACT-
FINDING  BOARD  OF  NOT MORE THAN THREE MEMBERS FROM A LIST OF QUALIFIED
PERSONS MAINTAINED BY THE COMMISSIONER, WHICH FACT-FINDING  BOARD  SHALL
HAVE,  IN ADDITION TO THE POWERS DELEGATED TO IT BY THE BOARD, THE POWER
TO MAKE RECOMMENDATIONS FOR THE RESOLUTION OF THE DISPUTE.
DISPUTE  TO  THE  COMMISSIONER, AND MAY THEREAFTER ASSIST THE PARTIES TO
EFFECT A VOLUNTARY RESOLUTION OF THE  DISPUTE.  THE  FACT-FINDING  BOARD
MENDATIONS, THE IMPASSE CONTINUES, THE COMMISSIONER SHALL ORDER A RESOL-
S. 5044                             6
UTION   TO  THE  NEGOTIATIONS  BASED  UPON  THE  FINDINGS  OF  FACT  AND
COMMISSIONER  FOR FINAL APPROVAL. THE COMMISSIONER, WITH CONSULTATION OF
THE SUPERINTENDENT OF FINANCIAL SERVICES, SHALL  APPROVE  OR  DISAPPROVE
THE AGREEMENT WITHIN SIXTY DAYS OF SUCH SUBMISSION.
10.  THE  COMMISSIONER  MAY COLLECT INFORMATION FROM THE DEPARTMENT OF
FINANCIAL SERVICES AND OTHER PERSONS TO ASSIST IN EVALUATING THE  IMPACT
OF  THE PROPOSED ARRANGEMENT ON THE HEALTH CARE MARKETPLACE. THE COMMIS-
SIONER SHALL COLLECT INFORMATION FROM HEALTH PLAN COMPANIES  AND  HEALTH
CARE  PROVIDERS OPERATING IN THE SAME GEOGRAPHIC AREA AS THE HEALTH CARE
MENT THAT EXCLUDES, LIMITS THE  PARTICIPATION  OR  REIMBURSEMENT  OF  OR
§  4926. FEES. EACH PERSON WHO ACTS AS THE REPRESENTATIVE OR NEGOTIAT-
ING PARTY UNDER THIS TITLE, IN ANY GIVEN YEAR, SHALL PAY TO THE  DEPART-
MENT  A  FEE NOT TO EXCEED ONE HUNDRED DOLLARS PER REPRESENTED PHYSICIAN
OR THIRTY THOUSAND DOLLARS, WHICHEVER IS LESS, TO  ACT  AS  A  REPRESEN-
THE  FEES COLLECTED PURSUANT TO THIS SECTION SHALL BE DEPOSITED IN THE
STATE TREASURY TO THE CREDIT OF THE GENERAL  FUND/STATE  OPERATIONS  FOR
THE NEW YORK STATE DEPARTMENT OF HEALTH FUND.
§  4927.  MONITORING  OF  AGREEMENTS.  THE COMMISSIONER SHALL ACTIVELY
MONITOR AGREEMENTS APPROVED UNDER THIS TITLE TO ENSURE THAT  THE  AGREE-
§ 4928. CONFIDENTIALITY. ALL REPORTS AND OTHER INFORMATION REQUIRED TO
§  4929.  SEVERABILITY  AND CONSTRUCTION. THE PROVISIONS OF THIS TITLE
§ 4. The department of health, in consultation with the department  of
collective negotiation pursuant to title III of article 49 of the public
S. 5044                             7
health  law.  The report shall be submitted to the governor, the speaker
of the assembly, the temporary president of the senate and the chairs of
the senate and assembly health and insurance committees  at  least  four
months  prior to the expiration and repeal of this act. The report shall
extension,  alteration  and/or expansion of the provisions  of title III
of article 49 of the public health law and make  any  other  recommenda-
tions  related  to the implementation of collective negotiation pursuant
it shall have become a law and shall expire and be deemed repealed  five
years after such date; provided that, effective immediately, the commis-
sioner of health is authorized to promulgate any and all rules and regu-
lations   and  take  any  other  measures  necessary  to  implement  the