§ 4403. Health maintenance organizations; issuance of certificate of
authority. 1. The commissioner shall not issue a certificate of
authority to an applicant therefor unless the applicant demonstrates
that:

(a) it has defined a proposed enrolled population to which the health
maintenance organization proposes to provide comprehensive health
services and has established a mechanism by which that population may
advise in determining the policies of the organization;

(b) it has the capability of organizing, marketing, managing,
promoting and operating a comprehensive health services plan;

(c) it is financially responsible and may be expected to meet its
obligations to its enrolled members. For the purpose of this paragraph,
"financially responsible" means that the applicant shall assume full
financial risk on a prospective basis for the provision of comprehensive
health services, including hospital care and emergency medical services
within the area served by the plan, except that it may require providers
to share financial risk under the terms of their contract, it may have
financial incentive arrangements with providers or it may obtain
insurance or make other arrangements for the cost of providing
comprehensive health services to enrollees; any insurance or other
arrangement required by this paragraph shall be approved as to adequacy
by the superintendent as a prerequisite to the issuance of any
certificate of authority by the commissioner;

(d) the character, competence, and standing in the community of the
proposed incorporators, directors, sponsors or stockholders, are
satisfactory to the commissioner;

(e) the prepayment mechanism of its comprehensive health services
plan, the bases upon which providers of health care are compensated, and
the anticipated use of allied health personnel are conducive to the use
of ambulatory care and the efficient use of hospital services;

(f) acceptable procedures have been established to monitor the quality
of care provided by the plan, which, in the case of services provided by
non-participating providers, shall be limited to the provision of
reports to the primary care practitioner responsible for supervising and
coordinating the care of the enrollee;

(g) approved mechanisms exist to resolve complaints and grievances
initiated by any enrolled member; and

(h) the contract between the enrollee and the organization meet the
requirements of the superintendent as set forth in section forty-four
hundred six of this article, as to the provisions contained therein for
health services, the procedures for offering, renewing, converting and
terminating contracts to enrollees, and the rates for such contracts
including but not limited to, compliance with the provisions of section
one thousand one hundred nine of the insurance law.

2. The commissioner may adopt and amend rules and regulations pursuant
to the state administrative procedure act to effectuate the purposes and
provisions of this article. Such regulations may include rules and
procedures addressing the provision of emergency services, including
patient notification, obtaining authorization for treatment, transfer of
patients from one facility to another and emergency transportation
arrangements.

3. Nothing contained in this section shall preclude any person or
persons in developing a health maintenance organization from contacting
potential participants to discuss the health care services such
organization would offer, prior to the granting of a certificate of
authority.

4. Nothing in this article shall preclude any health maintenance
organization from meeting the requirements of any federal law which
would authorize such health maintenance organization to receive federal
financial assistance or which would authorize enrollees to receive
assistance from federal funds.

5. (a) The commissioner, at the time of initial licensure, at least
every three years thereafter, and upon application for expansion of
service area, shall ensure that the health maintenance organization
maintains a network of health care providers adequate to meet the
comprehensive health needs of its enrollees and to provide an
appropriate choice of providers sufficient to provide the services
covered under its enrollee's contracts by determining that (i) there are
a sufficient number of geographically accessible participating
providers; (ii) there are opportunities to select from at least three
primary care providers pursuant to travel and distance time standards,
providing that such standards account for the conditions of accessing
providers in rural areas; (iii) there are sufficient providers in each
area of specialty practice to meet the needs of the enrollment
population; (iv) there is no exclusion of any appropriately licensed
type of provider as a class; and (v) contracts entered into with health
care providers neither transfer financial risk to providers, in a manner
inconsistent with the provisions of paragraph (c) of subdivision one of
this section, nor penalize providers for unfavorable case mix so as to
jeopardize the quality of or enrollees' appropriate access to medically
necessary services; provided, however, that payment at less than
prevailing fee for service rates or capitation shall not be deemed or
presumed prima facie to jeopardize quality or access.

(b) The following criteria shall be considered by the commissioner at
the time of a review: (i) the availability of appropriate and timely
care that is provided in compliance with the standards of the Federal
Americans with Disability Act to assure access to health care for the
enrollee population; (ii) the network's ability to provide culturally
and linguistically competent care to meet the needs of the enrollee
population; (iii) the availability of appropriate and timely care that
is in compliance with the standards of the Paul Wellstone and Pete
Domenici Mental Health Parity and Addiction Equity Act of 2008, 42
U.S.C. 18031(j), and any amendments to, and federal guidance and
regulations issued under those Acts, which shall include an analysis of
the rate of out-of-network utilization for covered mental health and
substance use disorder services as compared to the rate of
out-of-network utilization for the respective category of medical
services; (iv) with the exception of initial licensure, the number of
grievances filed by enrollees relating to waiting times for
appointments, appropriateness of referrals and other indicators of plan
capacity; and regulations to be promulgated by the commissioner. The
commissioner shall determine standards for network adequacy for mental
health and substance use disorder treatment services, including
sub-acute care in a residential facility, assertive community treatment
services, critical time intervention services and mobile crisis
intervention services and propose regulations, in consultation with the
superintendent of financial services, the commissioner of the office of
mental health and the commissioner of the office of addiction services
and supports by December thirty-first, two thousand twenty-three.

(c) Each organization shall report on an annual basis the number of
enrollees and the number of participating providers in each
organization.

6. (a) If a health maintenance organization determines that it does
not have a health care provider with appropriate training and experience
in its panel or network to meet the particular health care needs of an
enrollee, the health maintenance organization shall make a referral to
an appropriate provider, pursuant to a treatment plan approved by the
health maintenance organization in consultation with the primary care
provider, the non-participating provider and the enrollee or enrollee's
designee, at no additional cost to the enrollee beyond what the enrollee
would otherwise pay for services received within the network.

(b) A health maintenance organization shall have a procedure by which
an enrollee who needs ongoing care from a specialist may receive a
standing referral to such specialist. If the health maintenance
organization, or the primary care provider in consultation with the
medical director of the organization and specialist if any, determines
that such a standing referral is appropriate, the organization shall
make such a referral to a specialist. In no event shall a health
maintenance organization be required to permit an enrollee to elect to
have a non-participating specialist, except pursuant to the provisions
of paragraph (a) of this subdivision. Such referral shall be pursuant to
a treatment plan approved by the health maintenance organization in
consultation with the primary care provider, the specialist, and the
enrollee or the enrollee's designee. Such treatment plan may limit the
number of visits or the period during which such visits are authorized
and may require the specialist to provide the primary care provider with
regular updates on the specialty care provided, as well as all necessary
medical information.

(c) A health maintenance organization shall have a procedure by which
a new enrollee upon enrollment, or an enrollee upon diagnosis, with (i)
a life-threatening condition or disease or (ii) a degenerative and
disabling condition or disease, either of which requires specialized
medical care over a prolonged period of time, may receive a referral to
a specialist with expertise in treating the life-threatening or
degenerative and disabling disease or condition who shall be responsible
for and capable of providing and coordinating the enrollee's primary and
specialty care. If the health maintenance organization, or primary care
provider in consultation with a medical director of the organization and
a specialist, if any, determines that the enrollee's care would most
appropriately be coordinated by such a specialist, the organization
shall refer the enrollee to such specialist. In no event shall a health
maintenance organization be required to permit an enrollee to elect to
have a non-participating specialist, except pursuant to the provisions
of paragraph (a) of this subdivision. Such referral shall be pursuant to
a treatment plan approved by the health maintenance organization, in
consultation with the primary care provider if appropriate, the
specialist, and the enrollee or the enrollee's designee. Such specialist
shall be permitted to treat the enrollee without a referral from the
enrollee's primary care provider and may authorize such referrals,
procedures, tests and other medical services as the enrollee's primary
care provider would otherwise be permitted to provide or authorize,
subject to the terms of the treatment plan. If an organization refers an
enrollee to a non-participating provider, services provided pursuant to
the approved treatment plan shall be provided at no additional cost to
the enrollee beyond what the enrollee would otherwise pay for services
received within the network.

(d) A health maintenance organization shall have a procedure by which
an enrollee with (i) a life-threatening condition or disease or (ii) a
degenerative and disabling condition or disease, either of which
requires specialized medical care over a prolonged period of time, may
receive a referral to a specialty care center with expertise in treating
the life-threatening or degenerative and disabling disease or condition.
If the health maintenance organization, or the primary care provider or
the specialist designated pursuant to paragraph (c) of this subdivision,
in consultation with a medical director of the organization, determines
that the enrollee's care would most appropriately be provided by such a
specialty care center, the organization shall refer the enrollee to such
center. In no event shall a health maintenance organization be required
to permit an enrollee to elect to have a non-participating specialty
care center, unless the organization does not have an appropriate
specialty care center to treat the enrollee's disease or condition
within its network. Such referral shall be pursuant to a treatment plan
developed by the specialty care center and approved by the health
maintenance organization, in consultation with the primary care
provider, if any, or a specialist designated pursuant to paragraph c of
this subdivision, and the enrollee or the enrollee's designee. If an
organization refers an enrollee to a specialty care center that does not
participate in the organization's network, services provided pursuant to
the approved treatment plan shall be provided at no additional cost to
the enrollee beyond what the enrollee would otherwise pay for services
received within the network. For purposes of this paragraph, a specialty
care center shall mean only such centers as are accredited or designated
by an agency of the state or federal government or by a voluntary
national health organization as having special expertise in treating the
life-threatening disease or condition or degenerative and disabling
disease or condition for which it is accredited or designated.

(e) (1) If an enrollee's health care provider leaves the health
maintenance organization's network of providers for reasons other than
those for which the provider would not be eligible to receive a hearing
pursuant to paragraph a of subdivision two of section forty-four hundred
six-d of this chapter, the health maintenance organization shall provide
written notice to the enrollee of the provider's disaffiliation and
permit the enrollee to continue an ongoing course of treatment with the
enrollee's current health care provider during a transitional period of:
(i) ninety days from the later of the date of the notice to the enrollee
of the provider's disaffiliation from the organization's network or the
effective date of the provider's disaffiliation from the organization's
network; or (ii) if the enrollee is pregnant at the time of the
provider's disaffiliation, the duration of the pregnancy and post-partum
care directly related to the delivery.

(2) During the transitional period the health care provider shall: (i)
continue to accept reimbursement from the health maintenance
organization at the rates applicable prior to the start of the
transitional period, and continue to accept the in-network cost-sharing
from the enrollee, if any, as payment in full; (ii) adhere to the
organization's quality assurance requirements and to provide to the
organization necessary medical information related to such care; and
(iii) otherwise adhere to the organization's policies and procedures,
including but not limited to procedures regarding referrals and
obtaining pre-authorization and a treatment plan approved by the
organization.

(f) If a new enrollee whose health care provider is not a member of
the health maintenance organization's provider network enrolls in the
health maintenance organization, the organization shall permit the
enrollee to continue an ongoing course of treatment with the enrollee's
current health care provider during a transitional period of up to sixty
days from the effective date of enrollment, if (i) the enrollee has a
life-threatening disease or condition or a degenerative and disabling
disease or condition or (ii) the enrollee has entered the second
trimester of pregnancy at the effective date of enrollment, in which
case the transitional period shall include the provision of post-partum
care directly related to the delivery. If an enrollee elects to continue
to receive care from such health care provider pursuant to this
paragraph, such care shall be authorized by the health maintenance
organization for the transitional period only if the health care
provider agrees (A) to accept reimbursement from the health maintenance
organization at rates established by the health maintenance organization
as payment in full, which rates shall be no more than the level of
reimbursement applicable to similar providers within the health
maintenance organization's network for such services; (B) to adhere to
the organization's quality assurance requirements and agrees to provide
to the organization necessary medical information related to such care;
and (C) to otherwise adhere to the organization's policies and
procedures including, but not limited to procedures regarding referrals
and obtaining pre-authorization and a treatment plan approved by the
organization. In no event shall this paragraph be construed to require a
health maintenance organization to provide coverage for benefits not
otherwise covered or to diminish or impair pre-existing condition
limitations contained within the subscriber's contract.

7. A health maintenance organization that requires or provides for
designation by an enrollee of a participating primary care provider
shall permit the enrollee to designate any participating primary care
provider who is available to accept such individual, and in the case of
a child, shall permit the enrollee to designate a physician (allopathic
or osteopathic) who specializes in pediatrics as the child's primary
care provider if such provider participates in the network of the health
maintenance organization.

* 8. Notwithstanding any provision of law to the contrary, a health
maintenance organization may expand its comprehensive health services
plan to include services operated, certified, funded, authorized or
approved by the office for people with developmental disabilities,
including habilitation services as defined in paragraph (c) of
subdivision one of section forty-four hundred three-g of this article,
and may offer such expanded plan to a population of persons with
developmental disabilities, as such term is defined in the mental
hygiene law, subject to the following:

(a) Such organization must have the ability to provide or coordinate
services for persons with developmental disabilities, as demonstrated by
criteria to be determined by the commissioner and the commissioner of
the office for people with developmental disabilities. Such criteria
shall include, but not be limited to, adequate experience providing or
coordinating services for persons with developmental disabilities;

(a-1) If the commissioner and the commissioner of the office for
people with developmental disabilities determine that such organization
lacks the experience required in paragraph (a) of this subdivision, the
organization shall have an affiliation arrangement with an entity or
entities that are non-profit organizations or organizations whose
shareholders are solely controlled by non-profit organizations with
experience serving persons with developmental disabilities, as
demonstrated by criteria to be determined by the commissioner and the
commissioner of the office for people with developmental disabilities,
with such criteria including, but not limited to, residential, day, and
employment services such that the affiliated entity will coordinate and
plan services operated, certified, funded, authorized or approved by the
office for people with developmental disabilities or will oversee and
approve such coordination and planning;

(a-2) Each enrollee shall receive services designed to achieve
person-centered outcomes, to enable that person to live in the most
integrated setting appropriate to that person's needs, and to enable
that person to interact with nondisabled persons to the fullest extent
possible in social, workplace and other community settings, provided
that all such services are consistent with such person's wishes to the
extent that such wishes are known and the individual's needs. With
respect to an individual receiving non-residential services operated,
certified, funded, authorized or approved by the office for people with
developmental disabilities prior to enrollment in the organization, such
guidelines shall require the organization to contract with the current
provider of such non-residential services at the rates established by
the office for ninety days, in order to ensure continuity of care. With
respect to an individual living in a residential facility operated or
certified by the office for people with developmental disabilities prior
to enrollment in the organization, the organization shall contract with
the provider of residential services for that residence at the rates
established by the office for people with developmental disabilities for
so long as such person lives in that residence pursuant to an approved
plan of care;

(b) The provision by such organization of services operated,
certified, funded, authorized or approved by the office for people with
developmental disabilities shall be subject to the joint oversight and
review of both the department and the office for people with
developmental disabilities. The department and such office shall require
such organization to provide comprehensive care planning, assess
quality, meet quality assurance requirements and ensure the enrollee is
involved in care planning.

(c) Such organization shall not provide or arrange for services
operated, certified, funded, authorized or approved by the office for
people with developmental disabilities until the commissioner and the
commissioner of the office for people with developmental disabilities
approve program features and rates that include such services, and
determine that such organization meets the requirements of this
paragraph and any other requirements set forth by the commissioner of
the office for people with developmental disabilities;

(d) An otherwise eligible enrollee receiving services through the
organization that are operated, certified, funded, authorized or
approved by the office for people with developmental disabilities shall
not be involuntarily disenrolled from such organization without the
prior approval of the commissioner of the office for people with
developmental disabilities. Notice shall be provided to the enrollee and
the enrollee may request a fair hearing regarding such disenrollment;

(e) The office for people with developmental disabilities shall
determine the eligibility of individuals receiving services operated,
certified, funded, authorized or approved by such office to enroll in
such a plan and shall enroll individuals it determines eligible in an
organization chosen by such individual, guardian or other legal
representative;

(f) The office for people with developmental disabilities, or its
designee, shall complete a comprehensive assessment for enrollees that
receive services operated, certified, funded, authorized or approved by
such office. This assessment shall include, but not be limited to, an
evaluation of the medical, social, habilitative and environmental needs
of each prospective enrollee as such needs relate to such enrollee's
health, safety, living environment and wishes, to the extent such wishes
are known. This assessment shall also serve as the basis for the
development and provision of an appropriate plan of care for the
enrollee. Such plan of care shall be focused on the achievement of
person-centered outcomes and shall be consistent with and help inform
any other person-centered plan required for the enrollee by the
commissioner of the office for people with developmental disabilities.
The initial assessment shall be completed by such office or its designee
other than the organization and shall be completed, in consultation with
the prospective enrollee's health care practitioner as necessary.
Reassessments shall be completed by the office or its designee, which
may be the organization. The commissioner of the office for people with
developmental disabilities shall prescribe the forms on which the
assessment shall be made.

(f-1) Such organization shall provide the department and the office
for people with developmental disabilities with a description of the
proposed marketing plan and how marketing materials will be presented to
persons with developmental disabilities or their authorized decision
makers for the purposes of enabling them to make an informed choice.

(g) No person with a developmental disability shall be required to
enroll in a comprehensive health services plan as a condition of
receiving medical assistance and services operated, certified, funded,
authorized or approved by the office for people with developmental
disabilities until program features and reimbursement rates are approved
by the commissioner and the commissioner of the office for people with
developmental disabilities and until such commissioners determine that
there are a sufficient number of plans authorized to coordinate care for
persons with developmental disabilities pursuant to this article
operating in the person's county of residence to meet the needs of
persons with developmental disabilities, and that such plans meet the
standards of this section.

(h) Organizations providing services operated, certified, funded,
authorized or approved by the office for people with developmental
disabilities shall be subject to all requirements applicable to DISCOs
operating under section forty-four hundred three-g of this article with
respect to quality assurance, grievances and appeals, informed choice,
participating in development of plans of care and requirements with
respect to marketing, to the extent that such requirements are not
inconsistent with this section.

(i) The provisions of this subdivision shall only be effective if, for
so long as, and to the extent that federal financial participation is
available for the costs of services provided hereunder to recipients of
medical assistance pursuant to title eleven of article five of the
social services law. The commissioner shall make any necessary
amendments to the state plan for medical assistance submitted pursuant
to section three hundred sixty-three-a of the social services law,
and/or submit one or more applications for waivers of the federal social
security act, as may be necessary to ensure such federal financial
participation. To the extent that the provisions of this subdivision are
inconsistent with other provisions of this article or with the
provisions of section three hundred sixty-four-j of the social services
law, the provisions of this subdivision shall prevail.

* NB Repealed December 31, 2025

9. A health maintenance organization shall have procedures for
coverage of medically fragile children including those necessary to
implement section forty-four hundred six-i of this article.