What's happening
This bill allows health care providers in Nassau and Suffolk counties to collectively negotiate contract terms with health plans, under state oversight.
Why it matters
Seeks to balance negotiating power. The bill recognizes that health plans often dominate contract negotiations with providers, potentially leading to terms that could negatively affect patient care or provider sustainability. By allowing collective negotiation, it tries to level the playing field, which could impact contract fairness and, ultimately, patient access and quality of care.
Limits on market influence and representation. The law sets boundaries to prevent excessive provider collusion, such as restricting any representative from negotiating on behalf of more than 30% of providers (or a specialty) in the area. This aims to avoid new monopolies or anti-competitive behavior that could drive up costs or limit patient choice.
Strong state oversight and consumer focus. All collective negotiations and agreements are subject to approval and active monitoring by the state health commissioner, who can intervene in disputes and revoke agreements if they violate terms. This oversight is intended to ensure that collective bargaining benefits both providers and consumers, and does not result in higher costs or reduced quality.
Temporary, closely monitored experiment. The authorization for collective negotiation is limited to a five-year demonstration in Nassau and Suffolk counties, with a mandatory report assessing its impact on care quality, access, and costs. The program’s future will depend on evidence of public benefit, suggesting a cautious, data-driven approach to this policy shift.
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Who cares
Independent health care providers in Nassau and Suffolk counties
The bill would let eligible providers collectively negotiate fees and other health plan contract terms through representatives covering no more than 30 percent of the local provider market or a particular provider type or specialty.
Health insurers and HMOs serving Nassau and Suffolk counties
They would face collective negotiations over reimbursement, coverage and administrative rules, with unresolved disputes subject to a resolution ordered by the health commissioner.
New York State Department of Health and Department of Financial Services
They would oversee the demonstration, review negotiations and agreements, and evaluate its effects on care quality, access and spending.
Patients covered by health plans in Nassau and Suffolk counties
Negotiations could address medical necessity standards, drug formularies, referrals and other contract terms affecting their care.
Headline styles
Let Doctors Negotiate Together
Plain English, a few words. Used as the page title.
Sponsors
History
- Referred to codes
- Reported referred to codes
- Referred to health
Companion bill
The same bill in the other chamber. A bill becomes law when one version passes both houses and the governor signs it, so either number can carry it.
Let Providers Negotiate Health Plans
In Senate Committee · Health · Sponsor Kemp Hannon
Full text
7 pagesUnderlined is new[Struck] is removedOfficial text on nysenate.gov ↗
STATE OF NEW YORK
6831
2017-2018 Regular Sessions
IN ASSEMBLY
March 21, 2017
Introduced by M. of A. ENGLEBRIGHT, LAVINE, THIELE, JEAN-PIERRE, D'URSO -- read once and referred to the Committee on Health
AN ACT to amend the public health law, in relation to requirements for collective negotiations by health care providers with certain health benefit plans in certain counties; and providing for the repeal of such provisions upon the expiration thereof
The People of the State of New York, represented in Senate and Assembly, do enact as follows:
Section 1. Statement of legislative intent. The legislature finds that collective negotiation by competing health care providers for the terms and conditions of contracts with health plans can result in beneficial results for health care consumers. The legislature further finds instances where health plans dominate the market to such a degree that fair and adequate negotiations between health care providers and the plans are adversely affected, so that it is necessary and appropriate to provide for a demonstration to examine the risks and benefits associated with a system of collective action on behalf of health care providers. Consequently, the legislature finds it appropriate and necessary in the demonstration service area to displace competition with regulation of health plan provider agreements and authorize collective negotiations on the terms and conditions of the relationship between health care plans and health care providers so the imbalances between the two will not result in adverse conditions of health care. This act is not intended to apply to or affect in any respect collective bargaining relationships involving health care providers, as defined in section 4920 of the public health law or rights relating to collective bargaining arising under applicable federal or state collective bargaining statutes.
§ 2. Short title. This act shall be known and may be cited as the "health care consumer and provider protection act".
§ 3. Article 49 of the public health law is amended by adding a new title III to read as follows:
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD10367-01-7
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TITLE III
COLLECTIVE NEGOTIATIONS BY HEALTH CARE
PROVIDERS WITH HEALTH CARE PLANS Section 4920. Definitions.
4921. Non-fee related collective negotiation authorized.
4922. Fee related collective negotiation.
4923. Collective negotiation requirements.
4924. Requirements for health care providers' representative.
4925. Certain collective action prohibited.
4926. Fees.
4927. Monitoring of agreements.
4928. Confidentiality.
4929. Severability and construction.
§ 4920. Definitions. For purposes of this title:
1. "Health care plan" means an entity (other than a health care provider) that approves, provides, arranges for or pays for health care services in the demonstration service area, including but not limited to:
(a) a health maintenance organization licensed pursuant to article forty-three of the insurance law or certified pursuant to article forty-four of this chapter;
(b) any other organization certified pursuant to article forty-four of this chapter; or
(c) an insurer or corporation subject to the insurance law.
2. "Person" means an individual, association, corporation or any other legal entity.
3. "Health care providers' representative" means a third party who is authorized by health care providers to negotiate on their behalf with health care plans over contractual terms and conditions affecting those health care providers.
4. "Strike" means a work stoppage, in part or in whole, direct or indirect, by a body of workers to gain compliance with demands made on an employer.
5. "Substantial market share in a business line" exists if a health care plan's market share of a business line within the demonstration service area as approved by the commissioner, in consultation with the superintendent of financial services, alone or in combination with the market shares of affiliates, exceeds either ten percent of the total number of covered lives in that service area for such business line or twenty-five thousand lives, or if the commissioner, in consultation with the superintendent of financial services, determines the market share of the insurer in the relevant insurance product and geographic markets for the services of the providers seeking to collectively negotiate significantly exceeds the countervailing market share of the providers acting individually.
6. "Health care provider" means a person who is licensed, certified, or registered pursuant to title eight of the education law and who practices as a health care provider as an independent contractor and/or who is an owner, officer, shareholder, or proprietor of a health care provider in the demonstration service area. A health care provider under title eight of the education law who practices as an employee of a health care provider shall not be deemed a health care provider for purposes of this title.
7. "Demonstration service area" shall include the counties of Nassau and Suffolk.
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§ 4921. Non-fee related collective negotiation authorized. 1. Health care providers practicing within the demonstration service area may meet and communicate for the purpose of collectively negotiating with a health care plan the following terms and conditions of provider contracts with the health care plan:
(a) the details of the utilization review plan as defined pursuant to subdivision ten of section forty-nine hundred of this article and subsection (j) of section four thousand nine hundred of the insurance law;
(b) coverage provisions; health care benefits; benefit maximums, including benefit limitations; and exclusions of coverage;
(c) the definition of medical necessity;
(d) the clinical practice guidelines used to make medical necessity and utilization review determinations;
(e) preventive care and other medical management practices;
(f) drug formularies and standards and procedures for prescribing off-formulary drugs;
(g) respective physician liability for the treatment or lack of treatment of covered persons;
(h) the details of health care plan risk transfer arrangements with providers;
(i) plan administrative procedures, including methods and timing of health care provider payment for services;
(j) procedures to be utilized to resolve disputes between the health care plan and health care providers;
(k) patient referral procedures including, but not limited to, those applicable to out-of-pocket network referrals;
(l) the formulation and application of health care provider reimbursement procedures;
(m) quality assurance programs;
(n) the process for rendering utilization review determinations including: establishment of a process for rendering utilization review determinations which shall, at a minimum, include: written procedures to assure that utilization reviews and determinations are conducted within the timeframes established in this article; procedures to notify an enrollee, an enrollee's designee and/or an enrollee's health care provider of adverse determinations; and procedures for appeal of adverse determinations, including the establishment of an expedited appeals process for denials of continued inpatient care or where there is imminent or serious threat to the health of the enrollee;
(o) health care provider selection and termination criteria used by the health care plan; and
(p) rules regarding retrospective audits.
2. Nothing in this section shall be construed to allow or authorize an alteration of the terms of the internal and external review procedures set forth in law.
3. Nothing in this section shall be construed to allow a strike of a health care plan by health care providers or plans as otherwise set forth in the laws of this state.
4. Nothing in this section shall be construed to allow or authorize terms or conditions which would impede the ability of a health care plan to obtain or retain accreditation by the national committee for quality assurance or a similar body.
§ 4922. Fee related collective negotiation. 1. Health care providers practicing within the demonstration service area may collectively nego-
A. 6831 4
tiate the following terms and conditions relating to that business line with the health care plan:
(a) the fees assessed by the health care plan for services, including fees established through the application of reimbursement procedures;
(b) the conversion factors used by the health care plan in a resource-based relative value scale reimbursement methodology or other similar methodology; provided the same are not otherwise established by state or federal law or regulation;
(c) the amount of any discount granted by the health care plan on the fee of health care services to be rendered by health care providers;
(d) the dollar amount of capitation or fixed payment for health services rendered by health care providers to health care plan enrollees;
(e) the procedure code or other description of a health care service covered by a payment and the appropriate grouping of the procedure codes; or
(f) the amount of any other component of the reimbursement methodology for a health care service.
2. Nothing in this section shall be deemed to affect or limit the right of a health care provider or group of health care providers to collectively petition a government entity for a change in a law, rule or regulation.
§ 4923. Collective negotiation requirements. 1. Collective negotiation rights granted by this title shall conform to the following requirements:
(a) health care providers may communicate with other health care providers regarding the contractual terms and conditions to be negotiated with a health care plan;
(b) health care providers may communicate with health care providers' representatives;
(c) a health care providers' representative is the only party authorized to negotiate with health care plans on behalf of the health care providers as a group;
(d) a health care provider can be bound by the terms and conditions negotiated by the health care providers' representatives; and
(e) in communicating or negotiating with the health care providers' representative, a health care plan is entitled to contract with or offer different contract terms and conditions to individual competing health care providers.
2. A health care providers' representative shall not represent more than thirty percent of the market of health care providers or of a particular health care provider type or specialty practicing in the demonstration service area.
3. Nothing in this section shall be construed to prohibit collective action on the part of any health care provider who is a member of a collective bargaining unit recognized pursuant to the national labor relations act.
§ 4924. Requirements for health care providers' representative. 1. Before engaging in collective negotiations with a health care plan on behalf of health care providers, a health care providers' representative shall file with the commissioner, in the manner prescribed by the commissioner, information identifying the representative, the representative's plan of operation, and the representative's procedures to ensure compliance with this title.
2. Before engaging in the collective negotiations, a health care providers' representative shall also submit to the commissioner, for the
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commissioner's approval, a report identifying the proposed subject matter of the negotiations or discussions with the health care plan and the efficiencies or benefits expected to be achieved through the negotiations for both the providers and consumers of health services. The commissioner shall not approve the report if he or she, in consultation with the superintendent of financial services, determines that the proposed negotiations would exceed the authority granted under this title.
3. The representative shall supplement the information in the report on a regular basis or as new information becomes available, in the event it changes or will change the subject matter of the negotiations with the health care plan. In no event shall the report be less than every sixty days.
4. With the advice of the superintendent of financial services, the commissioner shall approve or disapprove the report not later than the twentieth day after the date on which the report is filed. If disapproved, the commissioner shall furnish a written explanation of any deficiencies, along with a statement of specific proposals for remedial measures to cure the deficiencies. If the commissioner does not so act within the twenty days, the report shall be deemed approved.
5. A person who acts as a health care providers' representative without the approval of the commissioner under this section shall be deemed to be acting outside the authority granted under this title.
6. Before reporting the results of negotiations with a health care plan, the health care providers' representative shall furnish to the commissioner a copy of all memorandums and meeting minutes pertaining to negotiations in relation to the health care provider.
7. A health care providers' representative shall report the end of negotiations to the commissioner not later than the fourteenth day after the date of a health care plan decision declining negotiation, canceling negotiations or failing to respond to a request for negotiation. In such instances, a health care providers' representative may request intervention from the commissioner to require the health care plan to participate in the negotiation pursuant to subdivision eight of this section.
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