Establishes the class E felony of unlawful procurement of clients, patients or customers

1 Co-sponsor

• Martin J. Golden

Title of bill

An act to amend the penal law, in relation to establishing the class E felony of unlawful procurement of clients, patients or customers

Purpose

To make the use of "runners" illegal in New York.

Summary of provisions

Amends article 176 of the Penal Law as follows: Section one of the bill adds three new definitions to Section 176.00. defining "provider". "public media" and "runner." A "runner" is defined as a person who. for a pecuniary benefit. procurers or attempts to procure a client. patient. or customer at the direction of. request of or in cooperation with a provider whose purpose is to seek to obtain benefits under a contract of insurance or assert a claim against an insured or an insurance carrier for providing services to the client, patient or customer.

Section two of the bill adds a new section 176.40 to the Penal Law to make it a class E felony to use or act as a runner.

Section three of the bill provides for an effective date.

Justification

On July 15, 1999 Governor Christie Whitman of New Jersey signed into law legislation making it a crime to act as a runner or to solicit or employ a runner to procure clients. This law was a result of recommendations by that state's Governor's Task Force on Health Care Fraud.

This legislation is patterned on that law. The use of runners is a practice which facilitates fraud and serves no legitimate purpose. A runner is defined as a person who receives a pecuniary benefit for procuring or attempting to procure clients. patients or customers for a provider whose purpose is to obtain benefits under an insurance contract for providing services. Because most fraud schemes depend on a large volume of patients. health care providers and attorneys engaged in fraud will often pay third parties for recruiting clients, patients and customers. Often the client, patient or customer receives inadequate or inappropriate care and services.

The use of runners is unfortunately common in the New York metropolitan area. In addition to inadequate medical care, the use of runners inflates the cost of insurance which, in turn, is borne by the insuring public. This bill makes it illegal for a provider to payor offer to pay a pecuniary benefit to a runner. Soliciting clients through the public media and referring clients, patients and customers to a provider as is otherwise authorized by law is excluded from the prohibitions under this bill. The tem1S of this proposal are consistent with the Bar Association's Canon of Ethics regarding referrals.

This bill makes it a class E felony to act as a runner or hiring another person to act as a runner.

Cost to state and local governments

None.

Legislative history

2007/2008 - S.637 - Passed Senate /Assembly Codes 2005/2006 - S.487 - Passed Senate/Assembly Codes 2003/2004 - S.555 - Passed Senate/Assembly Codes 2001/2002 - S.123 - Passed Senate/Assembly Codes 2000 - S.6781-B - Passed Senate/Assembly Rules

Effective date

This act shall take effect on the first of November next succeeding the date on which it shall have become a law.