S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                  1502

                       2015-2016 Regular Sessions

                          I N  A S S E M B L Y

                            January 12, 2015
                               ___________

Introduced  by  M.  of A. ZEBROWSKI, HOOPER -- read once and referred to
  the Committee on Judiciary

AN ACT to amend the general obligations law and the public  health  law,
  in  relation  to imposing liability on insurers for failure to approve
  coverage for inpatient mental health treatment

  THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section  1.  The  general obligations law is amended by adding two new
sections 11-108 and 11-109 to read as follows:
  S 11-108. ACCOUNTABILITY OF HEALTH CARE ORGANIZATIONS. 1. DEFINITIONS.
FOR PURPOSES OF THIS SECTION AND SECTION 11-109 OF  THIS  TITLE,  UNLESS
THE CONTEXT CLEARLY REQUIRES OTHERWISE:
  (A)  "HEALTH  CARE  ORGANIZATION" MEANS AN ENTITY, OTHER THAN A HEALTH
CARE PROVIDER, THAT APPROVES, PROVIDES, ARRANGES FOR, OR PAYS FOR HEALTH
CARE SERVICES, INCLUDING BUT NOT LIMITED TO:
  (I) A HEALTH MAINTENANCE ORGANIZATION  LICENSED  PURSUANT  TO  ARTICLE
FORTY-THREE  OF  THE  INSURANCE  LAW  OR  CERTIFIED  PURSUANT TO ARTICLE
FORTY-FOUR OF THE PUBLIC HEALTH LAW,
  (II) ANY OTHER ORGANIZATION CERTIFIED PURSUANT TO  ARTICLE  FORTY-FOUR
OF THE PUBLIC HEALTH LAW, OR
  (III)  AN  ACCIDENT  OR  HEALTH  INSURANCE  CORPORATION SUBJECT TO THE
INSURANCE LAW.
  NO ENTITY OR PERSON SHALL BE DEEMED TO BE A HEALTH  CARE  ORGANIZATION
BECAUSE  THE  ENTITY  OR  PERSON  PROCURES  OR  PAYS FOR HEALTH COVERAGE
THROUGH AN ENTITY ACTING UNDER THE INSURANCE LAW OR  ARTICLE  FORTY-FOUR
OF THE PUBLIC HEALTH LAW.
  (B) "HEALTH CARE PROVIDER" MEANS AN ENTITY LICENSED OR CERTIFIED UNDER
ARTICLE TWENTY-EIGHT OR THIRTY-SIX OF THE PUBLIC HEALTH LAW, A PREFERRED
PROVIDER  ORGANIZATION,  A  PARTICIPATING  ENTITY THROUGH WHICH A HEALTH
MAINTENANCE ORGANIZATION OFFERS HEALTH SERVICES UNDER ARTICLE FORTY-FOUR
OF THE PUBLIC HEALTH LAW, AN ENTITY LICENSED OR CERTIFIED UNDER  ARTICLE

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD00524-01-5
              

A. 1502                             2

SIXTEEN,  THIRTY-ONE  OR  THIRTY-TWO OF THE MENTAL HYGIENE LAW, A HEALTH
CARE PRACTITIONER LICENSED, REGISTERED OR CERTIFIED UNDER TITLE EIGHT OF
THE EDUCATION LAW, OR A PROVIDER OF PHARMACEUTICAL PRODUCTS OR  SERVICES
OR DURABLE MEDICAL EQUIPMENT.
  2.  (A) WHENEVER A HEALTH CARE ORGANIZATION OR HEALTH INSURER FAILS OR
REFUSES TO APPROVE, PROVIDE, ARRANGE  FOR,  OR  PAY  FOR,  IN  A  TIMELY
MANNER, THE ADMISSION OF A COVERED PERSON TO A MENTAL HEALTH CARE FACIL-
ITY  WHERE  SUCH  ADMISSION IS RECOMMENDED BY A HEALTH CARE PROFESSIONAL
WHO IS PROVIDING TREATMENT TO SUCH PERSON, TO THE EXTENT IT IS  CONTRAC-
TUALLY  OR  LEGALLY  OBLIGATED  TO  DO  SO,  IT  SHALL BE LIABLE FOR ANY
PERSONAL INJURY, DEATH OR DAMAGES TO ANY PERSON WHICH ARE CAUSED BY  THE
DELAY, FAILURE OR REFUSAL.
  (B)  A  HEALTH  CARE  ORGANIZATION SHALL BE LIABLE UNDER THIS SECTION,
UNDER OTHERWISE APPLICABLE RULES OF TORT AND CONTRACT LIABILITY, INCLUD-
ING BUT NOT LIMITED TO RULES RELATING TO  AGENCY,  VICARIOUS  LIABILITY,
AND  JOINT  AND  SEVERAL LIABILITY, FOR ANY ACT BY AN AGENT, CONTRACTOR,
PARTICIPATING ENTITY, OR HEALTH CARE PROVIDER, FOR WHICH THE HEALTH CARE
ORGANIZATION WOULD BE LIABLE IF IT WERE COMMITTED  BY  THE  HEALTH  CARE
ORGANIZATION.
  3.  THE  FAILURE  OF  THE PERSON, OR OF ANY OTHER PERSON ACTING ON THE
PERSON'S BEHALF, TO SEEK AN ALTERNATIVE PROVIDER OF OR TO  PAY  FOR  THE
HEALTH  CARE  SERVICE  SHALL NOT DIMINISH THE HEALTH CARE ORGANIZATION'S
LIABILITY OR CONSTITUTE CULPABLE CONDUCT FOR  THE  PURPOSES  OF  SECTION
FOURTEEN HUNDRED ELEVEN OF THE CIVIL PRACTICE LAW AND RULES.
  4.  NOTHING  IN  THIS  SECTION  SHALL LIMIT ANY OTHER RIGHT, REMEDY OR
CAUSE OF ACTION THAT ANY PERSON MAY OTHERWISE HAVE.
  5. NO CONTRACT OR AGREEMENT BETWEEN A HEALTH CARE ORGANIZATION  AND  A
HEALTH CARE PROVIDER SHALL:
  (A) DIRECTLY OR INDIRECTLY REQUIRE A HEALTH CARE PROVIDER TO INDEMNIFY
OR  HOLD HARMLESS THE HEALTH CARE ORGANIZATION FOR ANY LIABILITY RESULT-
ING FROM THE HEALTH CARE ORGANIZATION'S ACTS OR OMISSIONS; OR
  (B) WAIVE, LIMIT, OR DELEGATE THE LIABILITY OF THE HEALTH CARE  ORGAN-
IZATION UNDER THIS SECTION TO ANY HEALTH CARE PROVIDER.
  6. NO CONTRACT OR AGREEMENT BETWEEN A HEALTH CARE ORGANIZATION AND ANY
PERSON  SHALL  WAIVE OR LIMIT ANY LIABILITY OF THE HEALTH CARE ORGANIZA-
TION UNDER THIS SECTION TO THE PERSON.
  7. IF THE TIME IN WHICH A PLAINTIFF COULD HAVE COMMENCED AN ACTION FOR
PROFESSIONAL MALPRACTICE FOR THE ACT, ERROR OR  OMISSION  COMPLAINED  OF
HAS  EXPIRED  PRIOR TO THE COMMENCEMENT OF AN ACTION BROUGHT PURSUANT TO
THIS SECTION AGAINST A HEALTH CARE ORGANIZATION, THE DEFENDANT  IN  SAID
ACTION  SHALL  BE  BARRED FROM COMMENCING A THIRD-PARTY ACTION AGAINST A
PERSON NOT A PARTY WHO IS OR MAY BE LIABLE TO THAT DEFENDANT FOR ALL  OR
PART OF THE PLAINTIFF'S CLAIM AGAINST THE DEFENDANT AND AGAINST WHOM THE
PLAINTIFF  CANNOT COMMENCE AN ACTION FOR PROFESSIONAL MALPRACTICE DUE TO
THE EXPIRATION OF THE STATUTE OF LIMITATIONS PRIOR TO  THE  COMMENCEMENT
OF THE ACTION AGAINST THE DEFENDANT.
  8. A HEALTH CARE ORGANIZATION SHALL EXERCISE REASONABLE CARE:
  (A)  WHEN  MAKING  DECISIONS WHICH AFFECT THE MENTAL HEALTH CARE OF AN
ENROLLEE; AND
  (B) IN SELECTING AND EXERCISING INFLUENCE OR CONTROL OVER ITS  EMPLOY-
EES, AGENTS, OSTENSIBLE AGENTS, OR REPRESENTATIVES WHO ARE ACTING ON ITS
BEHALF,  RESPECTING DECISIONS WHICH MAY AFFECT THE QUALITY OF THE MENTAL
HEALTH CARE SERVICE PROVIDED TO ITS ENROLLEES.
  9. THIS SECTION SHALL NOT BE CONSTRUED TO DIMINISH ANY CONTRACTUAL  OR
LEGAL OBLIGATION OF THE HEALTH CARE ORGANIZATION, NOR TO CREATE AN OBLI-
GATION  ON THE PART OF THE HEALTH CARE ORGANIZATION TO PROVIDE ANY INPA-

A. 1502                             3

TIENT MENTAL HEALTH CARE SERVICE TO AN ENROLLEE THAT IS  NOT  A  COVERED
BENEFIT.
  S  11-109.  PROTECTION  OF  HEALTH  CARE  PROVIDERS. 1. NO HEALTH CARE
ORGANIZATION OR HEALTH CARE  PROVIDER  SHALL,  BY  CONTRACT,  POLICY  OR
PROCEDURE:
  (A)  PROHIBIT  OR  RESTRICT  ANY  HEALTH  CARE  PROVIDER FROM FILING A
COMPLAINT;
  (B) PROHIBIT OR RESTRICT ANY HEALTH CARE PROVIDER FROM MAKING A REPORT
OR COMMENTING TO THE APPROPRIATE GOVERNMENT AGENCY REGARDING  THE  POLI-
CIES  OR  PRACTICES  OF THE ORGANIZATION WHICH MAY NEGATIVELY AFFECT THE
QUALITY OF OR ACCESS TO HEALTH CARE SERVICES; OR
  (C) PROHIBIT OR RESTRICT ANY HEALTH CARE PROVIDER FROM  DISCLOSING  OR
COMMENTING  ON POLICIES OR PRACTICES OF THE ORGANIZATION WHICH MAY NEGA-
TIVELY AFFECT THE QUALITY OF OR ACCESS TO HEALTH CARE  SERVICES  TO  THE
PUBLIC.
  THIS  SUBDIVISION  SHALL  NOT  BE  CONSTRUED  TO  PERMIT A HEALTH CARE
PROVIDER TO DISCLOSE ANY INFORMATION REGARDING  A  PATIENT  WHICH  WOULD
OTHERWISE  BE  DEEMED CONFIDENTIAL OR PRIVILEGED, OR WHICH SHOULD NOT BE
DISCLOSED OR DISCUSSED ACCORDING TO LAW OR REASONABLE PROFESSIONAL STAN-
DARDS.
  2. NO HEALTH CARE ORGANIZATION OR HEALTH CARE PROVIDER SHALL TERMINATE
A CONTRACT OR EMPLOYMENT OF A HEALTH CARE PROVIDER, OR REFUSE  TO  RENEW
SUCH  A  CONTRACT, OR PENALIZE A HEALTH CARE PROVIDER OR REDUCE OR LIMIT
THE COMPENSATION OF A HEALTH CARE PROVIDER SOLELY BECAUSE A HEALTH  CARE
PROVIDER HAS:
  (A)  ADVOCATED FOR, RECOMMENDED OR PROVIDED MENTAL HEALTH CARE SERVICE
TO A PATIENT, TO WHICH THE PATIENT WAS ENTITLED BY CONTRACT OR LAW;
  (B) TAKEN ANY ACTION UNDER SUBDIVISION ONE OF THIS SECTION;
  (C) APPEALED OR ASSISTED IN APPEALING A DECISION OF  THE  HEALTH  CARE
ORGANIZATION  RELATING  TO THE PROVISION OF MENTAL HEALTH CARE SERVICES;
OR
  (D) REQUESTED A HEARING OR REVIEW TO WHICH THE PROVIDER WAS ENTITLED.
  3. NO HEALTH CARE ORGANIZATION OR HEALTH CARE PROVIDER SHALL APPLY ANY
INCENTIVE, WHETHER MONETARY OR OTHERWISE,  TO  A  HEALTH  CARE  PROVIDER
INTENDED  OR  HAVING  THE EFFECT OF INDUCING THE HEALTH CARE PROVIDER TO
DELAY, FAIL OR REFUSE  TO  PROVIDE  ANY  INPATIENT  MENTAL  HEALTH  CARE
SERVICE TO WHICH A PATIENT IS ENTITLED BY CONTRACT OR LAW.
  S  2. Section 4410 of the public health law is amended by adding a new
subdivision 5 to read as follows:
  5. NO CONTRACT OR AGREEMENT BETWEEN A HEALTH MAINTENANCE  ORGANIZATION
OR  ITS  COMPREHENSIVE HEALTH SERVICES PLAN AND ANY HEALTH CARE PROVIDER
SHALL DELEGATE THE LIABILITY OF THE HEALTH MAINTENANCE  ORGANIZATION  TO
ANY  HEALTH  CARE  PROVIDER OR SHALL REQUIRE THE HEALTH CARE PROVIDER TO
INDEMNIFY OR HOLD HARMLESS THE ORGANIZATION OR PLAN  FOR  ANY  LIABILITY
THE ORGANIZATION OR PLAN MAY INCUR PURSUANT TO THE PROVISIONS OF SECTION
11-108 OR 11-109 OF THE GENERAL OBLIGATIONS LAW.
  S  3.  This  act  shall take effect on the sixtieth day after it shall
have become a law.