NY Pub Health L § 4408-A (2021)
2021 New York Laws PBH - Public Health Article 44 - Health Maintenance Organizations 4408-A - Integrated Delivery Systems.

* §  4408-a.  Integrated  delivery systems. 1. Legislative purpose and findings.  The  legislature  intends  to  facilitate  the   ability   of integrated delivery systems to assume a larger role in delivering a full array  of health care services, from primary and preventive care through acute inpatient hospital and post-hospital care to a defined  population for  a  determined  price.  The legislature finds that the formation and operation of integrated delivery systems under this section will promote the purposes of federal and state anti-referral statutes  which  are  to reduce  over-utilization  and  expenditures and finds that such statutes should not be interpreted to interfere  with  the  development  of  such integrated delivery systems or impose liability for arrangements between an integrated delivery system certified pursuant to this section and its participating providers and entities. The legislature further finds that the  development  of  integrated  delivery systems will reduce costs and enhance  quality.  It  intends  that  systems  acting  pursuant   to   a certificate  of authority issued under this section shall not be subject to state or federal antitrust liability for doing so.   2. Definitions. For the purposes of this section:  (a) "Applicant" means a separate legal entity created for the  purpose of establishing and operating an integrated delivery system. Such entity shall  be  composed of or controlled by one or more affiliated providers or one or more affiliated groups of providers.  (b) "Provider" means an entity licensed  or  certified  under  article twenty-eight  or  thirty-six  of  this  chapter;  an  entity licensed or certified under article sixteen, twenty-three, thirty-one or  thirty-two of the mental hygiene law; or a health care practitioner, or combination of  health  care  practitioners,  licensed  under  title  eight  of  the education law. Every provider shall be: (i) a  natural  person;  (ii)  a partnership  all  of whose members are natural persons and that is not a limited partnership; or (iii) a corporation none of whose stock is owned by another corporation.   3. The  commissioner,  after  receiving  from  the  superintendent  of financial  services  the  evaluations and approvals required pursuant to subdivision seven of this section, may issue a certificate of  authority to  an  applicant  which satisfies the conditions under this section for issuance established by the commissioner  and  which  seeks  to  deliver comprehensive health services, on a capitated basis, including inpatient services, to:  (a)  persons  who  are  receiving  benefits  under  title XVIII of the federal social security act; or  (b) persons who are receiving benefits under title XIX of the  federal social security act and commercial enrollees; or  (c)  an  enrollee population which includes persons receiving benefits under titles XVIII and XIX  of  the  federal  social  security  act  and commercial enrollees.   4.  An  applicant  must  demonstrate  to the commissioner that it will provide at least seventy-five percent  of  the  total  expenditures  for covered health care items and services directly to its enrollees through the  provider,  affiliated  providers  or affiliated groups of providers comprising such applicant. The  applicant  shall  make  arrangements  or referrals  for  any  covered health care items and services not provided directly to its enrollees by such applicant.   5. A provider shall be deemed  affiliated  with  another  provider  or group of providers if, through contract, ownership or otherwise:  (a) one provider, directly or indirectly, owns, controls, or holds the power  to  vote,  or proxies for, not less than fifty-one percent of the voting rights or governance rights of another;  (b) each provider is a participant in a lawful combination under which each  provider  shares,  either  directly  or  indirectly,   substantial financial  risk  in  connection with the activities and services of such combination; or  (c)  a  provider  is  a  corporate member of a provider organized as a not-for-profit corporation  duly  designated  pursuant  to  section  six hundred one of the not-for-profit corporation law.   6. The commissioner shall be responsible for evaluating, approving and regulating all matters relating to delivery systems, quality of care and access to care to be provided through the integrated delivery system. In performing this responsibility, the commissioner shall assure:  (a) that the formation and operation of the integrated delivery system will enhance access to health services in the area to be served; and  (b)  subject  to  subdivision  four of this section, the comprehensive health services will be provided by the applicant through  its  proposed delivery system (including through providers other than those composing, affiliated with or controlling the applicant).   7.  (a) The superintendent of financial services, in consultation with the commissioner in accordance with a protocol  to  be  specified  in  a memorandum   of   understanding   between   the   commissioner  and  the superintendent of financial services regarding fiscal solvency, shall be responsible  for  evaluating,  approving  and  regulating  all   matters relating  to  premium  rates,  subscriber contracts and fiscal solvency, including reserves, surplus and provider contracts to  the  extent  such contracts  relate  to  fiscal  solvency  matters.  The superintendent of financial services, in the administration of this subdivision, shall:  (i) be guided by the standards which govern the fiscal solvency  of  a health   maintenance   organization,   provided,   however,   that   the superintendent of financial services shall recognize  and  consider  the specific   delivery   components,  operational  capacity  and  financial capability of the applicant for a certificate of authority; and  (ii) not apply financial solvency standards that exceed those required for a health maintenance organization.  (b) Standards  established  pursuant  to  this  subdivision  shall  be adequate  to  protect  the  interests  of  the subscribers to integrated delivery systems. The  superintendent  of  financial  services  must  be satisfied  that  the  applicant is fiscally sound, and has made adequate provisions to pay for services:  (i) that are furnished by providers that are not affiliated  with  the applicant;  (ii)  to  meet  the specialized health care needs of certain enrollees needing care at specialty care centers; and  (iii) for which claims are submitted after the period  for  which  the applicant will receive payments.   8.  The  integrated delivery system shall have its premiums determined on a community-rated basis in accordance with the insurance  law  except where  the enrollees are eligible to receive services under title XIX of the federal social security act in which case the premium rates shall be established by the commissioner, in consultation with the superintendent of financial services, subject to the approval of the  director  of  the division of the budget.   9. An integrated delivery system shall be subject to the provisions of the   insurance   law   that   are   applicable  to  health  maintenance organizations,  this  chapter  and  regulations  applicable  to   health maintenance   organization,  and  any  regulations  promulgated  by  the commissioner or superintendent of financial services to  implement  this section.  To  the  extent  that  the  provisions  of  this  section  are  inconsistent with the provisions of this chapter or  the  provisions  of the insurance law, the provisions of this section shall prevail.   10.  No  certificate  of  authority  for an integrated delivery system shall be issued pursuant to this section on or after  April  first,  two thousand  two and integrated delivery systems issued certificates before such date shall accept no new enrollees thereafter.   * NB There are 2 § 4408-a's