S T A T E O F N E W Y O R K
________________________________________________________________________
9588
I N A S S E M B L Y
January 24, 2018
___________
Introduced by M. of A. GOTTFRIED -- read once and referred to the
Committee on Insurance
AN ACT to amend the public health law and the insurance law, in relation
to utilization review program standards and prescription drug formu-
lary changes during a contract year, and in relation to pre-authoriza-
tion of health care services
THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:
Section 1. Paragraph (c) of subdivision 1 of section 4902 of the
public health law, as added by chapter 705 of the laws of 1996, is
amended to read as follows:
(c) Utilization of written clinical review criteria developed pursuant
to a utilization review plan. SUCH CLINICAL REVIEW CRITERIA SHALL
UTILIZE RECOGNIZED EVIDENCE-BASED AND PEER REVIEWED CLINICAL REVIEW
CRITERIA THAT TAKES INTO ACCOUNT THE NEEDS OF ATYPICAL PATIENT POPU-
LATIONS AND DIAGNOSES;
§ 2. Paragraph (a) of subdivision 2 of section 4903 of the public
health law, as amended by chapter 371 of the laws of 2015, is amended to
read as follows:
(a) A utilization review agent shall make a utilization review deter-
mination involving health care services which require pre-authorization
and provide notice of a determination to the enrollee or enrollee's
designee and the enrollee's health care provider by telephone and in
writing within [three business days] FORTY-EIGHT HOURS of receipt of the
necessary information, OR WITHIN TWENTY-FOUR HOURS OF THE RECEIPT OF
NECESSARY INFORMATION IF THE REQUEST IS FOR AN ENROLLEE WITH A MEDICAL
CONDITION THAT PLACES THE HEALTH OF THE INSURED IN SERIOUS JEOPARDY
WITHOUT THE HEALTH CARE SERVICES RECOMMENDED BY THE ENROLLEE'S HEALTH
CARE PROFESSIONAL. To the extent practicable, such written notification
to the enrollee's health care provider shall be transmitted electron-
ically, in a manner and in a form agreed upon by the parties. The
notification shall identify; (i) whether the services are considered
in-network or out-of-network; (ii) and whether the enrollee will be held
harmless for the services and not be responsible for any payment, other
EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD11465-05-8
A. 9588 2
than any applicable co-payment or co-insurance; (iii) as applicable, the
dollar amount the health care plan will pay if the service is out-of-
network; and (iv) as applicable, information explaining how an enrollee
may determine the anticipated out-of-pocket cost for out-of-network
health care services in a geographical area or zip code based upon the
difference between what the health care plan will reimburse for out-of-
network health care services and the usual and customary cost for out-
of-network health care services. AN APPROVAL FOR A REQUEST FOR PRE-AU-
THORIZATION SHALL BE VALID FOR THE DURATION OF THE PRESCRIPTION OR
TREATMENT AS REQUESTED BY THE ENROLLEE'S HEALTH CARE PROVIDER.
§ 3. The public health law is amended by adding a new section 4909 to
read as follows:
§ 4909. PRESCRIPTION DRUG FORMULARY CHANGES. 1. A HEALTH CARE PLAN
REQUIRED TO PROVIDE ESSENTIAL HEALTH BENEFITS SHALL NOT, EXCEPT AS
OTHERWISE PROVIDED IN SUBDIVISION TWO OF THIS SECTION, REMOVE A
PRESCRIPTION DRUG FROM A FORMULARY:
(A) IF THE FORMULARY INCLUDES TWO OR MORE TIERS OF BENEFITS PROVIDING
FOR DIFFERENT DEDUCTIBLES, COPAYMENTS OR COINSURANCE APPLICABLE TO THE
PRESCRIPTION DRUGS IN EACH TIER, MOVE A DRUG TO A TIER WITH A LARGER
DEDUCTIBLE, COPAYMENT OR COINSURANCE, OR
(B) ADD UTILIZATION MANAGEMENT RESTRICTIONS TO A FORMULARY DRUG,
UNLESS SUCH CHANGES OCCUR AT THE TIME OF ENROLLMENT OR ISSUANCE OF
COVERAGE. SUCH PROHIBITION SHALL APPLY BEGINNING ON THE DATE ON WHICH
OPEN ENROLLMENT BEGINS FOR A PLAN YEAR AND THROUGH THE END OF THE PLAN
YEAR TO WHICH SUCH OPEN ENROLLMENT PERIOD APPLIES.
2. (A) A HEALTH CARE PLAN WITH A FORMULARY THAT INCLUDES TWO OR MORE
TIERS OF BENEFITS PROVIDING FOR DIFFERENT DEDUCTIBLES, COPAYMENTS OR
COINSURANCE APPLICABLE TO PRESCRIPTION DRUGS IN EACH TIER MAY MOVE A
PRESCRIPTION DRUG TO A TIER WITH A LARGER DEDUCIBLE, COPAYMENT OR COIN-
SURANCE IF AN AB-RATED GENERIC DRUG FOR SUCH PRESCRIPTION DRUG IS ADDED
TO THE FORMULARY AT THE SAME TIME.
(B) A HEALTH CARE PLAN MAY REMOVE A PRESCRIPTION DRUG FROM A FORMULARY
IF THE FEDERAL FOOD AND DRUG ADMINISTRATION DETERMINES THAT SUCH DRUG
SHOULD BE REMOVED FROM THE MARKET.
§ 4. Paragraph 3 of subsection (a) of section 4902 of the insurance
law, as added by chapter 705 of the laws of 1996, is amended to read as
follows:
(3) Utilization of written clinical review criteria developed pursuant
to a utilization review plan. SUCH CLINICAL REVIEW CRITERIA SHALL
UTILIZE RECOGNIZED EVIDENCE-BASED AND PEER REVIEWED CLINICAL REVIEW
CRITERIA THAT TAKES INTO ACCOUNT THE NEEDS OF ATYPICAL PATIENT POPU-
LATIONS AND DIAGNOSES;
§ 5. Paragraph 1 of subsection (b) of section 4903 of the insurance
law, as amended by chapter 371 of the laws of 2015, is amended to read
as follows:
(1) A utilization review agent shall make a utilization review deter-
mination involving health care services which require pre-authorization
and provide notice of a determination to the insured or insured's desig-
nee and the insured's health care provider by telephone and in writing
within [three business days] FORTY-EIGHT HOURS of receipt of the neces-
sary information, OR WITHIN TWENTY-FOUR HOURS OF THE RECEIPT OF NECES-
SARY INFORMATION IF THE REQUEST IS FOR AN INSURED WITH A MEDICAL CONDI-
TION THAT PLACES THE HEALTH OF THE INSURED IN SERIOUS JEOPARDY WITHOUT
THE HEALTH CARE SERVICES RECOMMENDED BY THE INSURED'S HEALTH CARE
PROVIDER. To the extent practicable, such written notification to the
enrollee's health care provider shall be transmitted electronically, in
A. 9588 3
a manner and in a form agreed upon by the parties. The notification
shall identify: (i) whether the services are considered in-network or
out-of-network; (ii) whether the insured will be held harmless for the
services and not be responsible for any payment, other than any applica-
ble co-payment, co-insurance or deductible; (iii) as applicable, the
dollar amount the health care plan will pay if the service is out-of-
network; and (iv) as applicable, information explaining how an insured
may determine the anticipated out-of-pocket cost for out-of-network
health care services in a geographical area or zip code based upon the
difference between what the health care plan will reimburse for out-of-
network health care services and the usual and customary cost for out-
of-network health care services. AN APPROVAL OF REQUEST FOR PRE-AUTHOR-
IZATION SHALL BE VALID FOR THE DURATION OF THE PRESCRIPTION OR TREATMENT
REQUESTED FOR PRE-AUTHORIZATION.
§ 6. The insurance law is amended by adding a new section 4909 to read
as follows:
§ 4909. PRESCRIPTION DRUG FORMULARY CHANGES. (A) A HEALTH CARE PLAN
REQUIRED TO PROVIDE ESSENTIAL HEALTH BENEFITS SHALL NOT, EXCEPT AS
OTHERWISE PROVIDED IN SUBSECTION (B) OF THIS SECTION, REMOVE A
PRESCRIPTION DRUG FROM A FORMULARY:
(I) IF THE FORMULARY INCLUDES TWO OR MORE TIERS OF BENEFITS PROVIDING
FOR DIFFERENT DEDUCTIBLES, COPAYMENTS OR COINSURANCE APPLICABLE TO THE
PRESCRIPTION DRUGS IN EACH TIER, MOVE A DRUG TO A TIER WITH A LARGER
DEDUCTIBLE, COPAYMENT OR COINSURANCE, OR
(II) ADD UTILIZATION MANAGEMENT RESTRICTIONS TO A FORMULARY DRUG,
UNLESS SUCH CHANGES OCCUR AT THE TIME OF ENROLLMENT OR ISSUANCE OF
COVERAGE. SUCH PROHIBITION SHALL APPLY BEGINNING ON THE DATE ON WHICH
OPEN ENROLLMENT BEGINS FOR A PLAN YEAR AND THROUGH THE END OF THE PLAN
YEAR TO WHICH SUCH OPEN ENROLLMENT PERIOD APPLIES.
(B) (I) A HEALTH CARE PLAN WITH A FORMULARY THAT INCLUDES TWO OR MORE
TIERS OF BENEFITS PROVIDING FOR DIFFERENT DEDUCTIBLES, COPAYMENTS OR
COINSURANCE APPLICABLE TO PRESCRIPTION DRUGS IN EACH TIER MAY MOVE A
PRESCRIPTION DRUG TO A TIER WITH A LARGER DEDUCIBLE, COPAYMENT OR COIN-
SURANCE IF AN AB-RATED GENERIC DRUG FOR SUCH PRESCRIPTION DRUG IS ADDED
TO THE FORMULARY AT THE SAME TIME.
(II) A HEALTH CARE PLAN MAY REMOVE A PRESCRIPTION DRUG FROM A FORMU-
LARY IF THE FEDERAL FOOD AND DRUG ADMINISTRATION DETERMINES THAT SUCH
DRUG SHOULD BE REMOVED FROM THE MARKET.
§ 7. Subsection (a) of section 3238 of the insurance law, as added by
chapter 451 of the laws of 2007, is amended to read as follows:
(a) An insurer, corporation organized pursuant to article forty-three
of this chapter, municipal cooperative health benefits plan certified
pursuant to article forty-seven of this chapter, or health maintenance
organization and other organizations certified pursuant to article
forty-four of the public health law ("health plan") shall pay claims for
a health care service for which a pre-authorization was required by, and
received from, the health plan prior to the rendering of such health
care service, AND ELIGIBILITY CONFIRMED ON THE DAY OF THE SERVICE,
unless:
(1) [(i) the insured, subscriber, or enrollee was not a covered person
at the time the health care service was rendered.
(ii) Notwithstanding the provisions of subparagraph (i) of this para-
graph, a health plan shall not deny a claim on this basis if the
insured's, subscriber's or enrollee's coverage was retroactively termi-
nated more than one hundred twenty days after the date of the health
care service, provided that the claim is submitted within ninety days
A. 9588 4
after the date of the health care service. If the claim is submitted
more than ninety days after the date of the health care service, the
health plan shall have thirty days after the claim is received to deny
the claim on the basis that the insured, subscriber or enrollee was not
a covered person on the date of the health care service.
(2)] the submission of the claim with respect to an insured, subscrib-
er or enrollee was not timely under the terms of the applicable provider
contract, if the claim is submitted by a provider, or the policy or
contract, if the claim is submitted by the insured, subscriber or enrol-
lee;
[(3)] (2) at the time the pre-authorization was issued, the insured,
subscriber or enrollee had not exhausted contract or policy benefit
limitations based on information available to the health plan at such
time, but subsequently exhausted contract or policy benefit limitations
after authorization was issued; provided, however, that the health plan
shall include in the notice of determination required pursuant to
subsection (b) of section four thousand nine hundred three of this chap-
ter and subdivision two of section forty-nine hundred three of the
public health law that the visits authorized might exceed the limits of
the contract or policy and accordingly would not be covered under the
contract or policy;
[(4)] (3) the pre-authorization was based on materially inaccurate or
incomplete information provided by the insured, subscriber or enrollee,
the designee of the insured, subscriber or enrollee, or the health care
provider such that if the correct or complete information had been
provided, such pre-authorization would not have been granted; OR
[(5) the pre-authorized service was related to a pre-existing condi-
tion that was excluded from coverage; or
(6)] (4) there is a reasonable basis supported by specific information
available for review by the superintendent that the insured, subscriber
or enrollee, the designee of the insured, subscriber or enrollee, or the
health care provider has engaged in fraud or abuse.
§ 8. This act shall take effect on the ninetieth day after it shall
have become a law.