Relates to the provisional credentialing of physicians

Section 2 amends Subsection 1 of Section 446-d of the public health law by adding a new paragraph (c) that provides that newly licensed physicians, physicians that have recently relocated to the state or a physician who has changed their corporate relationship such that it results in the issuance of a new tax identification number under which their services are billed for, who are employed by a licensed Article 28 facility whose other employed health care professionals participate in the in-network portion of a health plan's network shall be considered provisionally credentialed from the date the health plan receives the hospital and physician's completed sections of the plan's credentialing application and the plan is notified in writing that the physician has been granted hospital privileges.

Section 3 is the effective date.

Existing law

The latest of the managed care reform laws (Chapter 237 of the Laws of 2009) provided that newly licensed health care professionals or health care professionals that recently relocated to New York State who joined a group practice of health care professionals and have applied to be credentialed as part of the in-network of a health plan's network are considered provisionally credentialed if their application is not approved or denied with 90 days from the date of application.

Justification

The model of care delivery is gradually shifting from a physician private practice model to a model of hospital or health system employed physicians. In fact, a leading physician recruiting firms (Merritt Hawkins) has predicted that by 2015, over 75% of newly hired physicians will be hospital employees. In order to recruit and retain physicians, upstate hospitals in a market of increasing physician shortage have been forced to be at the forefront of this shifting model of care. However, faced with increasingly constrained revenue from Medicare and Medicaid cuts and commercial health plans, hospitals, who most often lose money on physicians services component of care even with full payment, cannot carry afford to carry a physician on salary for 90 days without reimbursement for their services nor based on the physician shortage can they afford to be without the services of these physicians.

Hospitals as licensed and regulated Article 28 facilities are statutorily required to credential any provider before extending admitting privileges or allowing the professional to provide care within the facility. According to both hospitals and health plan administrators it is almost unheard of for a hospital itself to employ any physician who would be unsuitable for health plan credentialing.

All too often credentialing decisions and notification are delayed by simple administrative processes such has the delayed paperwork or the next scheduled meeting of the health plan's credentialing committee, The legislation would allow the hospitals to maximize the use of scarce health manpower and to be reimbursed for the services their employed physicians provide. The bill also provide for strict financial controls whereby the payments for all services provided to the health plans' enrollees are held and only after the health plan fully credentials the provider, are the payments for services rendered transmitted. Should a health plan, in rare cases, and for valid reasons elect not to credential a hospital employed physician then the payments to the hospital by the health plan are limited to the out of network payment, should the enrollee have coverage for out-of-network care.

Legislative history

S.5155 of 2014

Fiscal implications

None

Local fiscal implications

None

Effective date

This bill is effective ninety days after which it shall have become law, and applies to applications submitted after that date, and shall not apply submitted prior to such date if such application is resubmitted in substantially similar form on or after the date on which this act shall have become law.