Provides for the payment of actuarially sound and adequate rates for managed care plans and service providers

These labor requirements, which the amendments ensure are clearly referenced in the managed care and home care sections include the provisions of:

*Public Health law 3614-c (home care worker wage parity requirements); *Labor Law 652.1 (minimum wage payment requirements) *Workers Compensation Law, article 2, § 10 (workers comp coverage); *Federal Fair Labor Standards Act for employee overtime and other mandatory benefits; and *Other expenses mandated upon plans or providers for employees under any other provision of law *Public Health Law 3614.7, 3614.7-a, and 3612 (the statutorily provided-for administrative and general cost factor for home care agencies).

The bill further provides that the amount of reimbursement required to meet the costs of the above statutes is to be specifically identified as part of the payment rates to managed care plans and to contracted providers, and that a uniform process be established for the payment these mandates to providers.

The bill codifies the practice whereby, in setting actuarially sound and adequate payment rates, the commissioner is required to consider the analysis and recommendations of an independent actuary, and directs that the actuary's also be directly provided to the chairs of the senate and assembly health and fiscal committees.

The commissioner is directed to provide for expeditious adjustment and increase of managed care premiums to ensure actuarial soundness and adequacy of rates for timely compliance with the state's labor and public health laws as amended by the new 2016-17 state budget, and for expeditious adjustment of rates and payments to providers for timely compliance with the same.

The commissioner is further directed to provide for the efficient implementation of the managed care plan and provider reimbursement provisions, minimizing any new administrative, procedural or documentation burden on managed care plans or providers.

Justification

The adopted 2016-17 state budget provides for historic level increases in the minimum wage, the cost for which is especially critical in the long term health care field. The budget also provides new and carryover funding for other new and baseline mandated labor costs (as enumerated in the "summary of provisions" section of this memo.

Importantly, Article VII amendments were enacted with the new budget that require state calculation of adequate and sound rates, enabling managed care plans and providers "to comply with all applicable laws and regulations, state and federal."

This legislation ensures accountability and transparency in the implementation budget provisions funding for the minimum wage law. First, it enumerates key "state and federal" provisions intended to be covered in the overarching Article VII provisions adopted with the budget in order to ensure there is no question as to the coverage of these essential labor expenses as part of sound and adequate payments to providers and plans. Second, it ensures that payment adjustments made to managed care plans and providers to support these increased expenses are to be visibly itemized, and may not be offset by reductions elsewhere (that would essentially take back the needed adjustments and compromise rate soundness and adequacy). Third, it ensures uniformity, timeliness, efficiency and administrative simplicity in administration. Fourth, independent actuarial analyses used to calculate premiums are to be shared with the Legislature.

With the core roles played by managed care plans and home care agencies in the provision services to seniors, adults and medically fragile children, with the increased dependence on the viability and accessibility of community services in virtually all of the state's major health reforms and cost-containment strategies, with the significant financial challenges to managed care plans and providers in servicing these needs, and with state's promise of funding vital increases for health worker wages, this legislation is critical to supporting the actual attainment of these important purposes.

Legislative history

New bill.

Fiscal implications

Consistent with the adopted 2016-17 state fiscal plan; legislation ensures accountability and transparency in the implementation of the adopted 2016-17 budget.

Effective date

Immediately.