BILL NUMBER:  S7873A

 TITLE OF BILL :

An act to amend the public health law, in relation to payments from
the New York state medical indemnity fund

 PURPOSE :

This bill would ensure that the future health care costs for infants
who sustained birth-related neurological injuries and received a
court-approved settlement or judgment are properly paid for by the
Medical Indemnify Fund. It would also ensure a fair and impartial
review process when a claim for a medical expense or enrollment in the
fund is denied.

 SUMMARY OF PROVISIONS :

Section 1 of the bill amends Public Health Law § 2999-j (2-a) and
(7-a) to provide that:

1. A request for review of a claim denial or for prior authorization
for payment or reimbursement from the medical indemnity fund for a
qualifying health care cost must be made by the claimant no later than
sixty days from receipt of the denial, at the claimant's option, by
either (a) making application to the court where the judgment was
              

awarded or the case was settled, or (b) following the administrative
process established by regulations of the commissioner to review claim
denials.

2. A request for review of a determination by the fund administrator
that the relevant provisions of public health law section 2999-j(6)
have not been met and/or that the plaintiff or claimant is not a
qualified plaintiff may be made by any of the parties, no later than
sixty days from receipt of the denial, by making application to the
court wherein the judgment was awarded or the case was settled.

Section 2 amends Public Health Law § 2999-j(2) and (4) to prohibit the
Fund from prohibiting reimbursement of qualifying health care costs
solely on the basis that the cost is therapeutic in nature or that it
may benefit other members of the household. This section further
provides that qualifying health care costs to be paid from the medical
indemnity fund shall be reimbursed at the usual and customary cost,
which shall mean the 80th percentile of all charges for a particular
health care service performed by a provider in the same or similar
specialty and provided in the same geographical areas as reported in a
benchmarking database maintained by a non-profit entity designated by
the Superintendent of Financial Services. If no such rate is
available, reimbursed shall be calculated on the basis of no less than
130% of Medicaid or Medicare, whichever is more. If no Medicaid or
Medicare rate exists, the Commissioner shall provide for reimbursement
rates by regulation.

Section 3 makes technical amendments to Public Health Law 2999-h (1).

Section 4 establishes a Consumer and Stakeholder workgroup with
members appointed by the Governor, Senate and Assembly. The workgroup
must be consulted prior to the promulgation of any rules or
regulations.

Section 5 provides that the act take effect 45 days after it becomes
law.

 JUSTIFICATION :


The New York State Medical Indemnity Fund ("Fund") was a Medicaid
Redesign Team Initiative enacted in 2011 to provide a funding source
for future health care costs associated with birth-related
neurological injuries in order to reduce medical malpractice premium
costs. Enrollees in the Fund are plaintiffs in medical malpractice
actions who have received either court-approved settlements or
judgments deeming the plaintiffs' neurological impairments to be
birth-related. Participation in the Fund is mandatory.

The Fund has been in operation for more than four years, and the
experiences of the parents of children who are required to rely on the
Fund in lieu of direct compensation for their medical and health care
expenses have exposed issues with the administration of the Fund.

Under the current law and Commissioner's regulations payment rates for
medical and health care services covered by the Fund have been
limited. While services provided by private physicians are reimbursed
at a rate of 80% of the usual and customary cost as determined by FAIR
Health, Inc. (a not-for-profit corporation established to provide an
independent database of information of health care costs), all other
services are reimbursed at Medicaid rates. Children in the Fund may
already be eligible for Medicaid, in which case this reimbursement
benchmark provides no benefit. At this rate, families struggle to find
providers and often have to pay for care out of pocket. Many children
are unable to access the quality of care they need and their families
expected they would receive in exchange for relinquishing their right
to a medical malpractice judgment award or settlement. This
legislation remedies that by increasing the reimbursement rates for
health care costs from the fund. It is also important to note that the
Fund is well funded. Recent budgets appropriate over $50 million for
this purpose, and each year this amount is largely unspent.

Current regulations allow for administrative appeals before a
Department of Health Administrative Law Judge. The administrative law
judge's decision is final and may only be appealed by bringing an
Article 78 proceeding-a proceeding that is both costly and lengthy.
Many feel that the current regulations do not provide an impartial
appeal. This legislation will remedy this by providing families the
option of appealing through the current process or returning to the
court that judgment or settlement was entered.

In addition, the legislation provides that a denial of enrollment in
the Fund may also be reviewed by making application where the judgment
was awarded or the case was settled. Under the current law the only
avenue to appeal a denial of enrollment was by bringing an Article 78
proceeding. By allowing the parties to bring an action in the court
where the case was settled or the judgment was awarded will save time
and money as this is a court already familiar with the proceedings.
Section 3 of this bill also makes technical amendments regarding
eligibility for the Fund to address issues raised in Matter of K.O. v.
Lawsky, 50 Misc.3d 742, in which the Fund found the plaintiff not
qualified despite a Judge's finding to the contrary, based on the fact
that the infant was not admitted at the time of the injury. While the
Court found that the Fund acted arbitrarily in denying enrollment,
these changes would clarify the intent of this provision.

The Department has recently proposed regulations that would prohibit
approval of qualifying health care costs that are therapeutic in
nature or that, while they benefit the neurologically injured child,
may also provide an ancillary benefit to other members of the
household. This legislation would expressly prohibit these limitations
and would also establish a workgroup of parents and stakeholders that
shall be consulted prior to the promulgation of any regulations.

The children and the families of children who have sustained
birth-related neurological injuries due to malpractice deserve to have
their future health care costs and services they need paid for by the
Fund they are required to participate in. When enacted, it was not
anticipated that families would face hurdles or prohibitions on health
care costs that are found to be necessary by a treating physician. The
provisions of this bill will work to remedy current flaw in the Fund
and ensure it functions as originally intended.

 LEGISLATIVE HISTORY :

New bill.

 FISCAL IMPLICATIONS :

None.

 EFFECTIVE DATE :
45 days after enactment.

                                 BILL NUMBER:  S7873B

 TITLE OF BILL :  An act to amend the public health law, in relation
to payments from the New York state medical indemnity fund

 PURPOSE :

This bill would ensure that the future health care costs for infants
who sustained birth-related neurological injuries and received a
court-approved settlement or judgment are properly paid for by the
Medical Indemnify Fund. It would also ensure a fair and impartial
review process when a claim for a medical expense or enrollment in the
fund is denied.

 SUMMARY OF PROVISIONS :

Section 1 of the bill amends Public Health Law § 2999-j (2-a) and
(7-a) to provide that:

1. A request for review of a claim denial or for prior authorization
for payment or reimbursement from the medical indemnity fund for a
qualifying health care cost must be made by the claimant no later than
sixty days from receipt of the denial, at the claimant's option, by
either (a) making application to the court where the judgment was
awarded or the case was settled, or (b) following the administrative
process established by regulations of the commissioner to review claim
              

denials.

2. A request for review of a determination by the fund administrator
that the relevant provisions of public health law section 2999-j(6)
have not been met and/or that the plaintiff or claimant is not a
qualified plaintiff may be made by any of the parties, no later than
sixty days from receipt of the denial, by making application to the
court wherein the judgment was awarded or the case was settled.

Section 2 amends Public Health Law § 2999-j(2) and (4) to prohibit the
Fund from prohibiting reimbursement of qualifying health care costs
solely on the basis that the cost is therapeutic in nature or that it
may benefit other members of the household. This section further
provides that qualifying health care costs to be paid from the medical
indemnity fund shall be reimbursed at the usual and customary cost,
which shall mean the 80th percentile of all charges for a particular
health care service performed by a provider in the same or similar
specialty and provided in the same geographical areas as reported in a
benchmarking database maintained by a non-profit entity designated by
the Superintendent of Financial Services. If no such rate is
available, reimbursed shall be calculated on the basis of no less than
130% of Medicaid or Medicare, whichever is more. If no Medicaid or
Medicare rate exists, the Commissioner shall provide for reimbursement
rates by regulation.

Section 3 makes technical amendments to Public Health Law 2999-h (1).

Section 4 establishes a Consumer and Stakeholder workgroup with
members appointed by the Governor, Senate and Assembly. The workgroup
must be consulted prior to the promulgation of any rules or
regulations.

Section 5 provides that the act take effect 45 days after it becomes
law.

 JUSTIFICATION :

The New York State Medical Indemnity Fund ("Fund") was a Medicaid
Redesign Team Initiative enacted in 2011 to provide a funding source
for future health care costs associated with birth-related
neurological injuries in order to reduce medical malpractice premium
costs. Enrollees in the Fund are plaintiffs in medical malpractice
actions who have received either court-approved settlements or
judgments deeming the plaintiffs' neurological impairments to be
birth-related. Participation in the Fund is mandatory.

The Fund has been in operation for more than four years, and the
experiences of the parents of children who are required to rely on the
Fund in lieu of direct compensation for their medical and health care
expenses have exposed issues with the administration of the Fund.

Under the current law and Commissioner's regulations payment rates for
medical and health care services covered by the Fund have been
limited. While services provided by private physicians are reimbursed
at a rate of 80% of the usual and customary cost as determined by FAIR
Health, Inc. (a not-for-profit corporation established to provide an
independent database of information of health care costs), all other
services are reimbursed at Medicaid rates. Children in the Fund may
already be eligible for Medicaid, in which case this reimbursement
benchmark provides no benefit. At this rate, families struggle to find
providers and often have to pay for care out of pocket. Many children
are unable to access the quality of care they need and their families
expected they would receive in exchange for relinquishing their right
to a medical malpractice judgment award or settlement. This
legislation remedies that by increasing the reimbursement rates for
health care costs from the fund. It is also important to note that the
Fund is well funded. Recent budgets appropriate over $50 million for
this purpose, and each year this amount is largely unspent.

Current regulations allow for administrative appeals before a
Department of Health Administrative Law Judge. The administrative law
judge's decision is final and may only be appealed by bringing an
Article 78 proceeding-a proceeding that is both costly and lengthy.
Many feel that the current regulations do not provide an impartial
appeal. This legislation will remedy this by providing families the
option of appealing through the current process or returning to the
court that judgment or settlement was entered.

In addition, the legislation provides that a denial of enrollment in
the Fund may also be reviewed by making application where the judgment
was awarded or the case was settled. Under the current law the only
avenue to appeal a denial of enrollment was by bringing an Article 78
proceeding. By allowing the parties to bring an action in the court
where the case was settled or the judgment was awarded will save time
and money as this is a court already familiar with the proceedings.
Section 3 of this bill also makes technical amendments regarding
eligibility for the Fund to address issues raised in Matter of K.O. v.
Lawsky, 50 Misc.3d 742, in which the Fund found the plaintiff not
qualified despite a Judge's finding to the contrary, based on the fact
that the infant was not admitted at the time of the injury. While the
Court found that the Fund acted arbitrarily in denying enrollment,
these changes would clarify the intent of this provision.

The Department has recently proposed regulations that would prohibit
approval of qualifying health care costs that are therapeutic in
nature or that, while they benefit the neurologically injured child,
may also provide an ancillary benefit to other members of the
household. This legislation would expressly prohibit these limitations
and would also establish a workgroup of parents and stakeholders that
shall be consulted prior to the promulgation of any regulations.

The children and the families of children who have sustained
birth-related neurological injuries due to malpractice deserve to have
their future health care costs and services they need paid for by the
Fund they are required to participate in. When enacted, it was not
anticipated that families would face hurdles or prohibitions on health
care costs that are found to be necessary by a treating physician. The
provisions of this bill will work to remedy current flaw in the Fund
and ensure it functions as originally intended.

 LEGISLATIVE HISTORY :

New bill.

 FISCAL IMPLICATIONS :

None.

 EFFECTIVE DATE :
45 days after enactment.