Relates to financial responsibility and reimbursement for payment for early intervention services

Summary of provisions

Section 1 of the bill amends paragraph (a) of subdivision 3 of section 2559 of the public health law, as amended by section 11 of part A of Chapter 56 of the laws of 2012, by requiring, the state of New York, or its designated fiscal agent, to seek payment in the first instance from all third party payors in the early intervention program.

Section 2 of the bill directs payment to be made within 30 days of the date on which the municipality pays the claim for the approved costs of Early Intervention Services. It also clarifies that the net costs of Early Intervention Services are to be borne equally by the state and counties.

Section 3 of the bill requires the fiscal agent to do at least quarterly reconciliations of health insurance and Medicaid reimbursement, and provide refunds to the state and counties in equal shares.

Section 4 of the bill makes the bill to be effective immediately, and includes a provision that the act is deemed to be in full force and effect on or after June 1, 2014.

Justification

In 2012, changes were made to the funding of Early Intervention Services, particularly in the provision of occupational, speech and other provider directed therapies. The purpose of the changes was to ensure that NYS was receiving the full benefit of, and cost reductions appurtenant to, third party insurance reimbursement for covered services.

Under existing law, payment for the services rendered are delayed for an extended period of time, and only reimbursed initially up to 50%. Providers of these services, were, for the first time, required to obtain insurance reimbursement themselves.

Prior to the 2012 statutory changes, local government units were responsible for the collection of third party payments from health insurance companies and Medicaid for the appropriate share of the

reimbursable costs of those services. At no time prior to the enactment of this legislation were the providers required to collect these third party payments.

By changing the law, the statute has shifted the onerous and time consuming burden to the providers, many of whom are sole proprietorships. They do not have the requisite staff or systems required for coding, document submission or appeals that are part of the third party payment system.

As a result, many of the providers are unable to fulfill this new mandate, and large numbers have received no payments for services rendered since April 2013. The ability to provide early intervention services to children across the state is in jeopardy.

This legislation would require the state, or its fiscal agent, to pursue these funds, removing the unfunded mandate from local entities providing these early intervention health care services. Recognizing that the goal of the original statute was to capture third party payment and reduce the state's financial burden, the state or the fiscal agent is the appropriate entity to pursue this reimbursement.

Upon obtaining, third party payment from the insurers, the law would further require the fiscal agent to complete a reconciliation of reimbursements, and provide payment back to the state and counties in equal shares.

This legislation provides for more timely payment of the claims submitted by contracted providers, yet maintains the requirement that the providers and counties assist the state or the fiscal agent with the efforts to recoup the funds from the third party payors.

It also deems the new law to be in full force and effect as of June 1, 2014, so that payments can be made to providers for services rendered at that time.

Legislative history

2013: 5938A -- RULES

Fiscal implications

None anticipated.

Effective date

This act shall take effect immediately; provided that the new provisions of paragraph (a) of subdivision 3 of section 2559 of the public health law, and subdivision 1 of section 2557 of the public health law, shall be deemed to have been in full force and effect on or after June 1, 2014.