NY State Senate Bill 2025-S5241

Current Bill Status - In Senate Committee Insurance Committee

Introduced
- In Committee Assembly
- In Committee Senate
- On Floor Calendar Assembly
- On Floor Calendar Senate
- Passed Assembly
- Passed Senate
Delivered to Governor
Signed By Governor

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	Assembly Actions - Lowercase Senate Actions - UPPERCASE
Feb 20, 2025	referred to insurance

2025-S5241 (ACTIVE) - Details

Current Committee:: Senate Insurance
Law Section:: Insurance Law
Laws Affected:: Amd §§3224-b, 4900, 4902 & 4903, Ins L; amd §4902, Pub Health L

2025-S5241 (ACTIVE) - Summary

Provides that certain utilization review determinations shall be made consistent with medical and scientific evidence; includes services for mental health and substance use disorders as part of emergency services.

2025-S5241 (ACTIVE) - Sponsor Memo

                                 
BILL NUMBER: S5241

SPONSOR: FERNANDEZ
 
TITLE OF BILL:

An act to amend the insurance law and the public health law, in relation
to utilization review determinations

 
PURPOSE OR GENERAL IDEA OF BILL:

To increase access to appropriate care by requiring health insurers to
make medical necessity determinations consistent with medical and scien-
tific evidence.

 
SUMMARY OF PROVISIONS:

Section 1 amends insurance law to ban reversals of determinations of
medical necessity in the absence of fraud.

Section 2 defines mental health and substance use disorders in insurance
law.

Section 3 amends insurance law to require medical necessity determi-
nations to be made consistent with medical and scientific evidence.

Section 4 defines medical necessity in insurance law.

Section 5 amends insurance law in relation to out-of-network referral
denials.

Section 6 amends insurance law to include mental health and substance
use disorder services in the area of emergency services.

Section 7 outlines the role of a utilization review agent.

Section 8 amends public health law to include mental health and
substance use disorders in law related to emergency services.

Section 9 sets the effective date.

 
JUSTIFICATION:

When utilization review agents make medical necessity determinations
that are inconsistent with medical and scientific evidence, enrollees
are frequently unable to access critically needed services, including
for mental health and substance use disorders.

In New York, health plans must already determine the appropriate level
of care for substance use disorders using a single tool, LOCADTR, which
was developed by the Office of Addiction Services and Supports.  Howev-
er, there is no such requirement for other mental health conditions.
Instead, inconsistent, opaque, and non-validated clinical review crite-
ria are frequently used, hindering system-wide efforts to align around a
single set of high-quality criteria to improve health care quality and
access.

Additionally, providers have experienced aggressive post-service audits
by health plans that claw back significant payments for previously
approved care. Such practices have driven mental health and substance
use disorder providers out of insurer networks, leaving enrollees unable
to find in-network care.

The legislation amends New York's Insurance and Public Health laws to
increase access to appropriate care by requiring health insurers to make
medical necessity determinations consistent with medical and scientific
evidence, using transparent clinical review criteria. For mental health
conditions, it allows the Office of Mental Health to designate specific
level of care criteria.

Further, the legislation prohibits insurers from reversing or altering a
determination of medical necessity previously made by the utilization
review agent, except in cases of fraud.

Legislation requiring health plans to use fair standards for coverage
determinations will increase access to medically necessary services as
promised in plan policies, preventing inappropriate denials of needed
mental health and substance use disorder care.

 
PRIOR LEGISLATIVE HISTORY:

New bill

 
FISCAL IMPLICATIONS:

TBD

 
EFFECTIVE DATE:
This act shall take effect immediately

2025-S5241 (ACTIVE) - Bill Text download pdf

                             
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   5241
 
                        2025-2026 Regular Sessions
 
                             I N  S E N A T E
 
                             February 20, 2025
                                ___________
 
 Introduced by Sen. FERNANDEZ -- read twice and ordered printed, and when
   printed to be committed to the Committee on Insurance
 
 AN ACT to amend the insurance law and the public health law, in relation
   to utilization review determinations
 
   THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section 1. Paragraphs 4 and 5 of subsection (b) of section  3224-b  of
 the  insurance  law  are renumbered paragraphs 6 and 7 and two new para-
 graphs 4 and 5 are added to read as follows:
   (4) IN THE ABSENCE OF FRAUD, A RETROSPECTIVE  REVIEW  OR  AUDIT  OF  A
 CLAIM  BY  OR  ON BEHALF OF A HEALTH PLAN SHALL NOT REVERSE OR OTHERWISE
 ALTER A DETERMINATION OF MEDICAL NECESSITY PREVIOUSLY MADE BY A UTILIZA-
 TION REVIEW AGENT OR EXTERNAL APPEAL AGENT PURSUANT  TO  ARTICLE  FORTY-
 NINE OF THIS CHAPTER OR ARTICLE FORTY-NINE OF THE PUBLIC HEALTH LAW.
   (5)  IN  THE  ABSENCE  OF FRAUD, A REVIEW OR AUDIT OF A CLAIM BY OR ON
 BEHALF OF A HEALTH PLAN SHALL NOT DOWNGRADE OR BUNDLE THE  CODING  OF  A
 CLAIM  IF  IT HAS THE EFFECT OF REVERSING OR ALTERING A DETERMINATION OF
 MEDICAL NECESSITY, WHICH INCLUDES A LEVEL OF CARE DETERMINATION MADE  BY
 OR ON BEHALF OF THE HEALTH PLAN.
   §  2.  Section  4900  of  the insurance law is amended by adding a new
 subsection (d-6) to read as follows:
   (D-6) "MENTAL HEALTH AND  SUBSTANCE  USE  DISORDERS"  MEANS  A  MENTAL
 HEALTH  CONDITION  OR SUBSTANCE USE DISORDER THAT FALLS UNDER ANY OF THE
 DIAGNOSTIC CATEGORIES LISTED IN  THE  MENTAL  AND  BEHAVIORAL  DISORDERS
 CHAPTER  OF  THE  MOST RECENT EDITION OF THE WORLD HEALTH ORGANIZATION'S
 INTERNATIONAL STATISTICAL CLASSIFICATION OF DISEASES AND RELATED  HEALTH
 PROBLEMS,  OR  THAT IS LISTED IN THE MOST RECENT VERSION OF THE AMERICAN
 PSYCHIATRIC ASSOCIATION'S DIAGNOSTIC AND STATISTICAL  MANUAL  OF  MENTAL
 DISORDERS.  CHANGES  IN  TERMINOLOGY, ORGANIZATION, OR CLASSIFICATION OF
 MENTAL HEALTH AND SUBSTANCE USE DISORDERS  IN  FUTURE  VERSIONS  OF  THE
 AMERICAN  PSYCHIATRIC ASSOCIATION'S DIAGNOSTIC AND STATISTICAL MANUAL OF
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
                                                            LBD09369-01-5

 S. 5241                             2
 
 MENTAL  DISORDERS  OR  THE  WORLD  HEALTH  ORGANIZATION'S  INTERNATIONAL
 STATISTICAL CLASSIFICATION OF DISEASES AND RELATED HEALTH PROBLEMS SHALL
 NOT AFFECT THE CONDITIONS COVERED BY THIS SECTION AS LONG AS A CONDITION
 IS  COMMONLY  UNDERSTOOD TO BE A MENTAL HEALTH OR SUBSTANCE USE DISORDER
 BY HEALTH CARE PROVIDERS PRACTICING IN RELEVANT CLINICAL SPECIALTIES.
   § 3. Paragraph 7 of subsection (g-5) of section 4900 of the  insurance
 law, as amended by chapter 357 of the laws of 2010, is amended and a new
 paragraph 8 is added to read as follows:
   (7)  findings, studies, or research conducted by or under the auspices
 of  federal  government  agencies  and  nationally  recognized   federal
 research  institutes including the federal Agency for Health Care Policy
 and Research, National Institutes of Health, National Cancer  Institute,
 National  Academy  of  Sciences,  Health  Care Financing Administration,
 Congressional Office of Technology Assessment, and  any  national  board
 recognized by the National Institutes of Health for the purpose of eval-
 uating the medical value of health services[.]; AND
   (8)  PEER-REVIEWED  PRACTICE  GUIDELINES, CRITERIA, OR RECOMMENDATIONS
 FROM NON-PROFIT  CLINICAL  SPECIALTY  ASSOCIATIONS  THAT  ARE  GENERALLY
 RECOGNIZED BY CLINICIANS PRACTICING IN THE RELEVANT CLINICAL SPECIALTY.
   §  4.  Subsections  (g-6) and (g-6-a) of section 4900 of the insurance
 law are relettered subsections (g-6-a) and (g-6-b) and a new  subsection
 (g-6) is added to read as follows:
   (G-6)  "MEDICALLY  NECESSARY"  OR  "MEDICAL NECESSITY" MEANS A COVERED
 HEALTH CARE SERVICE OR PRODUCT THAT ADDRESSES THE SPECIFIC NEEDS OF  THE
 INSURED FOR THE PURPOSES OF PREVENTING, SCREENING, DIAGNOSING, MANAGING,
 TREATING, OR MINIMIZING THE PROGRESSION OF AN ILLNESS, INJURY, CONDITION
 OR ITS SYMPTOMS, AND THAT IS:
   (1) IN ACCORDANCE WITH MEDICAL AND SCIENTIFIC EVIDENCE;
   (2)  CLINICALLY APPROPRIATE IN TERMS OF TYPE, FREQUENCY, EXTENT, SITE,
 AND DURATION; AND
   (3) NOT PRIMARILY FOR THE ECONOMIC  BENEFIT  OF  THE  INSURER  OR  THE
 INSURED OR FOR THE CONVENIENCE OF THE INSURED OR THE HEALTH CARE PROVID-
 ER.
   § 5. Subsection (g-6-b) of section 4900 of the insurance law, as added
 by section 11 of part H of chapter 60 of the laws of 2014, and as relet-
 tered by section 4 of this act, is amended to read as follows:
   (g-6-b)  "Out-of-network  referral  denial"  means  a  denial  under a
 managed care product as defined in subsection (c) of section four  thou-
 sand eight hundred one of this chapter of a request for an authorization
 or  referral  to an out-of-network provider on the basis that the health
 care plan has a health care provider in the in-network benefits  portion
 of  its  network  with  appropriate  training and experience to meet the
 particular health care needs of an insured, and who is able  to  provide
 the  requested  health service. The notice of an out-of-network referral
 denial provided to an insured shall include information explaining  what
 information  the  insured must submit in order to appeal the out-of-net-
 work referral denial pursuant to subsection (a-2) of section four  thou-
 sand  nine  hundred  four  of  this  article. An out-of-network referral
 denial under this subsection does not  constitute  an  adverse  determi-
 nation  as  defined  in  this article. An out-of-network referral denial
 shall not be construed to include an out-of-network denial as defined in
 subsection [(g-6)] (G-6-A) of this section.
   § 6. Paragraphs 8, 9, 10, 11 and 12 of subsection (a) of section  4902
 of the insurance law, paragraph 8 as added by chapter 705 of the laws of
 1996,  paragraph 9 as amended by section 37 and paragraph 12 as added by
 section 38 of subpart A of part BB of chapter 57 of the  laws  of  2019,
 S. 5241                             3
 
 and  paragraphs  10  and 11 as added by chapter 512 of the laws of 2016,
 are amended to read as follows:
   (8)  Establishment of a requirement that emergency services, INCLUDING
 EMERGENCY  SERVICES  FOR  MENTAL  HEALTH  AND  SUBSTANCE  USE  DISORDERS
 PROVIDED BY MOBILE CRISIS RESPONSE TEAMS OR CRISIS RECEIVING OR STABILI-
 ZATION  CENTERS,  rendered  to  an insured shall not be subject to prior
 authorization nor shall reimbursement for such  services  be  denied  on
 retrospective   review[;  provided,  however,  that  such  services  are
 medically necessary]. NOTWITHSTANDING THE FOREGOING, PAYMENT  FOR  EMER-
 GENCY SERVICES MAY BE DENIED ONLY IF A HEALTH PLAN REASONABLE DETERMINES
 THE  EMERGENCY  SERVICES  WERE  NEVER PERFORMED to stabilize or treat an
 emergency condition.
   (9) When conducting utilization review  for  purposes  of  determining
 health care coverage for substance use disorder treatment, a utilization
 review agent shall utilize [an evidence-based and] A peer reviewed clin-
 ical  review  tool  that is appropriate to the age of the patient, FULLY
 CONSISTENT WITH MEDICAL AND SCIENTIFIC EVIDENCE, AND PUBLICLY IDENTIFIES
 ALL AUTHORS, REVIEWERS, AND EDITORS WHO PARTICIPATED IN THE  DEVELOPMENT
 AND  REVIEW  OF SUCH TOOL.   When conducting such utilization review for
 treatment provided in this  state,  a  utilization  review  agent  shall
 utilize  an evidence-based and peer reviewed clinical tool designated by
 the office of [alcoholism and substance abuse]  ADDICTION  services  AND
 SUPPORTS that is consistent with the treatment service levels within the
 office  of  [alcoholism  and  substance  abuse]  ADDICTION  services AND
 SUPPORTS system. All approved tools shall have inter  rater  reliability
 testing completed by December thirty-first, two thousand sixteen.
   [10.]  (10)  When  establishing a step therapy protocol, a utilization
 review agent shall utilize recognized [evidence-based and] peer reviewed
 clinical review criteria that [also] IS FULLY  CONSISTENT  WITH  MEDICAL
 AND  SCIENTIFIC  EVIDENCE  AND  takes into account the needs of atypical
 patient populations and diagnoses when establishing the clinical  review
 criteria.  THE  CRITERIA SHALL PUBLICLY IDENTIFY ALL AUTHORS, REVIEWERS,
 AND EDITORS WHO PARTICIPATED IN THE DEVELOPMENT AND REVIEW OF THE CRITE-
 RIA.
   [11.] (11) When conducting  utilization  review  for  a  step  therapy
 protocol  override  determination,  a  utilization  review  agent  shall
 utilize, in addition to any other requirements of this article,  [recog-
 nized evidence-based and] peer reviewed clinical review criteria that is
 appropriate  for  the insured and the insured's medical condition AND IS
 FULLY CONSISTENT WITH MEDICAL  AND  SCIENTIFIC  EVIDENCE.  THE  CRITERIA
 SHALL  PUBLICLY IDENTIFY ALL AUTHORS, REVIEWERS, AND EDITORS WHO PARTIC-
 IPATED IN THE DEVELOPMENT AND REVIEW OF THE CRITERIA.
   (12) When conducting utilization review for  purposes  of  determining
 health care coverage for a mental health condition, a utilization review
 agent  shall  utilize [evidence-based and] peer reviewed clinical review
 criteria that is FULLY CONSISTENT WITH MEDICAL AND  SCIENTIFIC  EVIDENCE
 AND  appropriate to the age of the patient. The utilization review agent
 shall use CLINICAL REVIEW CRITERIA DESIGNATED BY THE COMMISSIONER OF THE
 OFFICE OF MENTAL HEALTH FOR LEVEL OF CARE DETERMINATIONS,  IN  CONSULTA-
 TION  WITH THE SUPERINTENDENT AND THE COMMISSIONER OF HEALTH. FOR COVER-
 AGE DETERMINATIONS OUTSIDE THE SCOPE  OF  THE  CRITERIA  DESIGNATED  FOR
 LEVEL  OF  CARE  DETERMINATIONS,  THE UTILIZATION REVIEW AGENT SHALL USE
 clinical review criteria deemed appropriate and approved for such use by
 the commissioner of the office of mental health,  in  consultation  with
 the  commissioner  of  health  and the superintendent. Approved clinical
 S. 5241                             4
 
 review criteria shall have inter rater reliability testing completed [by
 December thirty-first, two thousand nineteen] PRIOR TO IMPLEMENTATION.
   §  7.  Section  4903  of  the insurance law is amended by adding a new
 subsection (j) to read as follows:
   (J) A UTILIZATION REVIEW AGENT SHALL AUTHORIZE A REQUEST FOR A COVERED
 HEALTH CARE SERVICE OR PRODUCT THAT IS MEDICALLY NECESSARY.
   § 8. Paragraphs (h), (i) and (j) of subdivision 1 and  subdivisions  3
 and  4 of section 4902 of the public health law, paragraph (h) of subdi-
 vision 1 as added by chapter 705 of the laws of 1996, paragraph  (i)  of
 subdivision  1 as amended and paragraph (j) of subdivision 1 as added by
 section 43 of subpart A of part BB of chapter 57 of the  laws  of  2019,
 and  subdivisions  3  and 4 as added by chapter 512 of the laws of 2016,
 are amended to read as follows:
   (h) Establishment of a requirement that emergency services,  INCLUDING
 EMERGENCY  SERVICES  FOR  MENTAL  HEALTH  AND  SUBSTANCE  USE  DISORDERS
 PROVIDED BY MOBILE CRISIS RESPONSE TEAMS OR CRISIS RECEIVING OR STABILI-
 ZATION CENTERS, rendered to an enrollee shall not be  subject  to  prior
 authorization  nor  shall  reimbursement  for such services be denied on
 retrospective  review[;  provided,  however,  that  such  services   are
 medically  necessary].  NOTWITHSTANDING THE FOREGOING, PAYMENT FOR EMER-
 GENCY SERVICES MAY BE DENIED ONLY IF A HEALTH PLAN REASONABLY DETERMINES
 THE EMERGENCY SERVICES WERE NEVER PERFORMED to  stabilize  or  treat  an
 emergency condition.
   (i)  When  conducting  utilization  review for purposes of determining
 health care coverage for substance use disorder treatment, a utilization
 review agent shall utilize [an evidence-based and] A peer reviewed clin-
 ical review tool that is appropriate to the age of  the  patient,  FULLY
 CONSISTENT WITH MEDICAL AND SCIENTIFIC EVIDENCE, AND PUBLICLY IDENTIFIES
 ALL  AUTHORS, PEER REVIEWERS, AND EDITORS WHO PARTICIPATED IN THE DEVEL-
 OPMENT AND REVIEW OF SUCH TOOL. When conducting such utilization  review
 for  treatment  provided in this state, a utilization review agent shall
 utilize an evidence-based and peer reviewed clinical tool designated  by
 the  office  of  [alcoholism and substance abuse] ADDICTION services AND
 SUPPORTS that is consistent with the treatment service levels within the
 office of  [alcoholism  and  substance  abuse]  ADDICTION  services  AND
 SUPPORTS  system.  All approved tools shall have inter rater reliability
 testing completed by December thirty-first, two thousand sixteen.
   (j) When conducting utilization review  for  purposes  of  determining
 health care coverage for a mental health condition, a utilization review
 agent  shall  utilize [evidence-based and] peer reviewed clinical review
 criteria that is FULLY CONSISTENT WITH MEDICAL AND  SCIENTIFIC  EVIDENCE
 AND appropriate to the age of the patient.  The utilization review agent
 shall  use clinical review criteria [deemed appropriate and approved for
 such use] DESIGNATED by the commissioner of the office of mental  health
 FOR  LEVEL OF CARE DETERMINATIONS, in consultation with the commissioner
 and the superintendent of  financial  services.  FOR  COVERAGE  DETERMI-
 NATIONS  OUTSIDE  THE SCOPE OF THE CRITERIA DESIGNATED FOR LEVEL OF CARE
 DETERMINATIONS, THE UTILIZATION REVIEW AGENT SHALL USE  CLINICAL  REVIEW
 CRITERIA DEEMED APPROPRIATE AND APPROVED FOR SUCH USE BY THE COMMISSION-
 ER OF THE OFFICE OF MENTAL HEALTH, IN CONSULTATION WITH THE COMMISSIONER
 AND  THE  SUPERINTENDENT OF FINANCIAL SERVICES. Approved clinical review
 criteria shall have inter rater reliability testing completed [by Decem-
 ber thirty-first, two thousand nineteen] PRIOR TO IMPLEMENTATION.
   3. When establishing a step therapy  protocol,  a  utilization  review
 agent  shall utilize [recognized evidence-based and] peer reviewed clin-
 ical review criteria that IS FULLY CONSISTENT WITH MEDICAL AND SCIENTIF-
 S. 5241                             5
 
 IC EVIDENCE AND takes into account the needs of atypical  patient  popu-
 lations  and  diagnoses  [as well] when establishing the clinical review
 criteria. THE CRITERIA SHALL PUBLICLY IDENTIFY ALL  AUTHORS,  REVIEWERS,
 AND EDITORS WHO PARTICIPATED IN THE DEVELOPMENT AND REVIEW OF THE CRITE-
 RIA.
   4.  When  conducting  utilization  review  for a step therapy protocol
 override determination, a utilization review  agent  shall  utilize,  in
 addition   to  any  other  requirements  of  this  article,  [recognized
 evidence-based and] peer  reviewed  clinical  review  criteria  that  is
 appropriate for the enrollee and the enrollee's medical condition AND IS
 FULLY  CONSISTENT  WITH  MEDICAL  AND  SCIENTIFIC EVIDENCE. THE CRITERIA
 SHALL PUBLICLY IDENTIFY ALL AUTHORS, REVIEWERS, AND EDITORS WHO  PARTIC-
 IPATED IN THE DEVELOPMENT AND REVIEW OF THE CRITERIA.
   § 9. This act shall take effect immediately.

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Senate Bill S5241

Sponsored By

Current Bill Status - In Senate Committee Insurance Committee

2025-S5241 (ACTIVE) - Details

2025-S5241 (ACTIVE) - Summary

2025-S5241 (ACTIVE) - Sponsor Memo

2025-S5241 (ACTIVE) - Bill Text download pdf

Comments

Senate Bill S5241

Share this bill

Sponsored By

Nathalia Fernandez

Current Bill Status - In Senate Committee Insurance Committee

2025-S5241 (ACTIVE) - Details

2025-S5241 (ACTIVE) - Summary

2025-S5241 (ACTIVE) - Sponsor Memo

2025-S5241 (ACTIVE) - Bill Text download pdf

Comments