Relates to referrals of patients for health related items or services

BILL NUMBER:S772

Title of bill

An act to amend the public health law, in relation to referrals of patients for health or health related items or services

Purpose or general idea of bill

To promote conformity between the federal Stark Law and New York's Health Care Practitioner Referrals Statute.

Summary of provisions

Amends Public Health Law §238-a (2) (c) to provide that a referral or arrangement that would be allowed under federal law, 42 U.S.C. 1395-nn or its regulations would similarly be allowed under the New York law, unless the Public Health and Health Planning Council declares a type of arrangement to pose a substantial risk of payor or patient abuse, by regulation approved by the Health Commissioner.

Amends the list of exemptions in Public Health Law § 238-a (6) (c) to add any referral or arrangement allowed under federal law, unless the state Public Health and Health Planning Council declares a type of referral to pose a substantial risk of payor or patient abuse, by regulation subject approval of the Health Commissioner.

Justification

The federal Stark law (named for its congressional sponsor) establishes complex rules on referrals from one health care provider to another and the financial relationships between providers. The purpose is to avoid kickback arrangements and conflicts of interest that cost patients and third-party payers money and can lead to unnecessary and inappropriate services,. New York State's law is similar but not the same. So some arrangements or referrals are permissible under the federal Stark law but not under the New York statute. This can create difficulties for health care providers.

For example, the New York statute does not contain exceptions for providing electronic medical record systems, donations of items and services to federally qualified health centers, and fair market value arrangements. Also, the New York exception for in-office ancillary services requires an employer/employee relationship, as compared to the Stark exception, which permits an independent contractor relationship.

The bill would provide that arrangements or referrals that are allowed under the federal law are also allowed under the New York law, unless the Public Health and Health Planning Council and the Health Commissioner designate particular types of arrangements or referrals that would not be allowed because they pose a substantial risk of payor or patient abuse. The bill was drafted in conjunction with the State Bar Association's health law section and has broad provider support.

Prior legislative history

2009-10: A.9933 - passed Assembly.

2011-2012: A.3551-A - vetoed by the Governor, 153

Fiscal implications

None.

Effective date

Immediately.