* § 2814. Health networks, global budgeting, and health care
demonstrations. 1. For the purposes of this section unless the context
clearly requires otherwise:

(a) "Board" shall mean the temporary statewide health advisory board
established pursuant to section nine hundred fifty-seven of the
executive law.

(b) "Proposal" shall mean a design or plan developed, as a result of
funds received pursuant to this section, to operate a network, global
budget, or regional health care demonstration.

2. (a) Notwithstanding any inconsistent provision of law, within
amounts available therefor, the commissioner shall make grants pursuant
to this section to (i) health care providers to facilitate development
of health networks or health care demonstrations (ii) health care
providers alone or in conjunction with third party payors to facilitate
development of global budgets and (iii) an organization demonstrably
representing the interests of the region or communities of the region
which demonstrate the support of the respective health systems agency to
facilitate development of health care demonstrations or global budgets.
Such networks, demonstrations, or global budgets shall be designed to
improve cost effectiveness of health care services, establish and
improve provider coordinated planning and management mechanisms, and/or
improve provider management of care or improve continuity of care.
Health care providers eligible to receive funding under section
twenty-nine hundred fifty-two of this chapter shall not be eligible for
grants under this section for development of health networks.

(b) Grants made pursuant to this section shall provide planning funds
which may include, but need not be limited to, funding to:

(i) assess the health care needs of the population and develop an
operational plan to meet these needs;

(ii) plan for and carry out any organizational changes needed to
integrate services; and

(iii) facilitate financing arrangements such as risk sharing and
capitation.

3. In awarding grants under this section, the commissioner shall
consult with the appropriate local health systems agency and shall
consider the recommendations of the temporary statewide health advisory
board on the grant proposals and to the extent practicable assure that
there is a sufficiently representative geographic distribution of
grantees including rural, urban, and suburban grantees. Grants made
pursuant to this section shall be used solely for the planning of health
networks, global budgets or health care demonstrations. Prior to
awarding grants, the commissioner shall first take into consideration
other financial resources available to the applicant to conduct such
planning.

4. In order to be eligible for a grant under this section, applicants
shall prepare and submit to the commissioner, the temporary statewide
health care advisory board, and the respective health systems agency an
application which contains the following:

(a) identification of the principal investigator or applicant for the
demonstration;

(b) a description of the nature and scope of the activities
contemplated;

(c) a description of the geographic area and populations currently
served by the entity;

(d) a description of the community or population to be served;

(e) a description of the anticipated benefits and advantages to
providers and consumers of services;

(f) a description of the estimated expenses, including administrative
expenses, which will be incurred in the development of the
demonstration; and

(g) the time frame proposed for the development of the health network,
global budgeting demonstration, or health care demonstration.

(h) the process that the eligible organization used in seeking public
participation and local involvement in the development of the program
plan; and

(i) the goals of the program, including information on how the program
plan will maintain and promote access to and delivery of high quality,
appropriate health or health related items and services for persons
residing in the region covered by the program.

5. Any grant recipient seeking to implement a proposal developed
pursuant to this section, except recipients of health networking grants,
shall submit such proposal to the temporary statewide health advisory
board, in such form and content determined by the board, which shall
evaluate such proposal and consider whether the proposal is likely to:

(a) aid in meeting the priority health needs and concerns in the
region as identified in and supported by evidence in the proposal and
consistent with recommendations of the regional health systems agency;

(b) enhance the quality of care as evidenced by outcome indicators;

(c) improve the cost-effectiveness of services by the entities
involved;

(d) improve the efficient utilization of the entities' resources and
capital equipment;

(e) enhance the provision of services that would otherwise not be
available;

(f) result in the elimination of unnecessary duplication of resources;

(g) reduce costs to individuals being served by the network;

(h) foster information sharing, communications and cooperation between
health care providers; and

(i) foster and improve the management and continuity of care.

6. In addition, the board shall require that the proposal contain
assurances that there will be equitable provider involvement in the
determination of any rates and rate setting methodology. The board shall
also require a description of how the proposed initiative will be
evaluated and assurance that the grantee will submit annual reports to
the governor and legislature concerning the status and experiences of
the initiative.

7. The temporary statewide health advisory board shall forward only
proposals recommended for operation to the commissioner for
authorization. In granting his authorization, the commissioner shall
certify that the proposal will:

(a) improve the cost effectiveness of health care services;

(b) improve the quality of care delivered as evidenced by outcome
indicators; and

(c) improve access to appropriate health care services.

8. Upon request by an applicant or grantee the commissioner and the
respective health system agency shall provide technical assistance.

9. The commissioner shall submit to the chairs of the senate finance
committee and the assembly ways and means committee and the chairs of
the assembly and senate health committees, a copy of any proposal
authorized by the commissioner pursuant to this section not more than
thirty days after approval.

10. With the exception of health networks, global budgets or health
care demonstrations that seek to implement alternative reimbursement
methodologies in general hospital settings only and/or for ambulatory
services associated with general hospital outpatient and diagnostic and
treatment center settings regarding payment for the medical assistance
program, as provided for in subdivisions ten and eleven of section
twenty-eight hundred seven of this article, no health network, global
budget or health care demonstration that seeks to implement alternative
reimbursement methodologies shall be approved or implemented without
approval pursuant to a chapter of the laws to be enacted by the
legislature.

* NB Expired June 30, 1996