Relates to certain prohibitions in contracts or agreements by health maintenance organizations

Subdivision 6: Prohibits the use of contract clauses which lower reimbursement levels for the provision of health care services based on the fact that another provider delivers the same services at a lower rate.

Subdivision 7: Bans the use of contract language which restricts the ability of a physician to make referrals to other health care providers.

Subdivision 8: Bans contract language which mandates the provision of a patient's diagnosis and the written prescription as a condition for covering a prescription drug.

Subdivision 9: Prohibits insurers from mandating the substitution of a pharmaceutical agent (other than a generic equivalent) by any person other than the prescribing professional.

Section 2: Amends Insurance Law section 3217-b to add similar provisions to the Insurance Law as are added by this bill to the public Health Law.

Section 3: Amends Insurance Law section 4325 to add similar provisions to the Insurance Law as are added by this bill to the Public Health Law.

Justification

Frequently, physicians and other health care providers provide health care to the uninsured and economically disadvantaged with very little or no compensation. Unfortunately, managed care insurance plans have created a disincentive to the provision of free and reduced cast care by inserting clauses into their contracts which requires a physician, or other health care provider, to accept reimbursement for a treatment/procedure at the lowest amount where such provider has charged an entity for the same treatment. Consequently, if a physician wishes to only charge a nominal fee in a particular instance, that physician jeopardized his or her reimbursement for all of his or her patients. Physicians, hospitals, and other providers should be allowed and encouraged to provide charity care without endangering the future of their practices.

Insurance plans should not be permitted to control the referral process, which the treating physician uses to ensure that the patient is seen and treated by the most appropriate medical professional. The issue of "in-network" or "out-of-network" providers should not be permitted to force treating physicians to refer to "in-network" providers only. While the plans may have different payment arrangements for in and out-of-network providers, an outright ban an out-of-network referrals is tantamount to a ban and the provision of sound medical advice.

Some plans require the provision of the patient's diagnosis, on the prescription, in order to consider coverage for the pharmaceutical drug. Not only is this practice a gross violation of patient privacy, but it serves to break the bonds of confidence between the patient and physicians and can place some patients in the awkward position of having to choose between receiving important medications and divulging personal health information. In addition, a growing number of insurance plans are arbitrarily requiring the substitution of "similar" pharmaceutical agents (as opposed to generic equivalents.) This can be at the expense of the patient's health, as the prescribing professional may have, in fact, chosen a certain agent because of a particular quality or certain circumstances or symptoms surrounding the patient's case. only a treating professional, with full knowledge of the patient's history, should have authority to change a patient's medication.

Prior legislative history

Assembly Legislation: 2002: A.10543 - Advanced to 3rd Reading 2003-04: A.3446 - Passed Assembly 2005-06: A.2204 - Passed Assembly 2007-08: A.4607B - Passed Assembly

Fiscal implications

None.

Effective date

This act shall take effect 180 days after it has become law.