What's happening
This bill prohibits utilization review agents from reviewing entities with which they have material familial, financial, or professional affiliations.
Why it matters
Reduces conflicts of interest in healthcare decision-making. by preventing utilization review agents (who determine insurance coverage for medical treatments) from reviewing cases involving entities with which they have significant personal, financial, or professional ties.
Promotes greater trust in the insurance review process. , as patients and providers can be more confident that coverage decisions are impartial and not influenced by hidden relationships.
May lead to more consistent and fair determinations. , reducing the risk that affiliated entities receive preferential—or prejudicial—treatment in insurance reviews, which can impact patient care and costs.
Encourages transparency and accountability. among insurers and review agents, as they must now actively identify and avoid reviewing cases where material affiliations exist.
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Who cares
Headline styles
Ban Biased Utilization Reviews
Plain English, a few words. Used as the page title.
Sponsors
No co-sponsors yet.
History
- Referred to health
- 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.
Stop Biased Health Reviews
In Assembly Committee · Insurance · Sponsor Michael DenDekker
Full text
1 pageUnderlined is new[Struck] is removedOfficial text on nysenate.gov ↗
STATE OF NEW YORK
2663
2017-2018 Regular Sessions
IN SENATE
January 17, 2017
Introduced by Sen. HAMILTON -- read twice and ordered printed, and when printed to be committed to the Committee on Health
AN ACT to amend the public health law and the insurance law, in relation to utilization review agents
The People of the State of New York, represented in Senate and Assembly, do enact as follows:
Section 1. Section 4905 of the public health law is amended by adding a new subdivision 16 to read as follows:
16. A utilization review agent shall not conduct a review of any entity in which it has "material familial affiliation", "material financial affiliation" or "material professional affiliation".
§ 2. Section 4905 of the insurance law is amended by adding a new subsection (p) to read as follows:
(p) A utilization review agent shall not conduct a review of any entity in which it has "material familial affiliation", "material financial affiliation" or "material professional affiliation".
§ 3. This act shall take effect immediately.
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD00740-01-7
Reflowed for reading: line numbers and page breaks removed. Cite the official text.
Sponsor's memo
Title of bill
An act to amend the public health law and the insurance law, in relation to utilization review agents
Purpose or general idea of bill
This bill will provide greater transparency in the health insurance utilization review process by prohibiting an agent from having a familial, financial, or professional relationship with the reviewed entity.
Summary of specific provisions
Section 1 amends section 4905 of the public health law by adding a new subsection (16) which further defines the list of prohibited practices by utilization review agents. Specifically, the bill provides that no utilization review agent may conduct a review of any entity in which it has a "material familial affiliation, a "material financial affiliation" or a "material professional affiliation."
Read the full memo (623 words)
Section 2 amends section 4905 insurance law by adding a new subdivision (n) which further defines the list of prohibited practices by utilization review agents. Specifically, the bill provides that no utilization review agent may conduct a review of any entity in which it has a "material familial affiliation, a "material financial affiliation" or a "material professional affiliation."
Section 3 provides that the bill will take effect immediately.
Justification
This legislation will promote transparency and equity in the utilization review process by ensuring that agents are independent, having no existing relationships with the reviewed entity. Therefore, all parties - both consumers and entities alike - will be assured that all determinations are impartial and related only to the facts at hand.
With the current status of the law, healthcare insurance carriers are put in the position where collusion with hospital providers may be taking place while they insist that all they are doing is negotiating to obtain the best possible rates for their customers. At a minimum, this practice should be prevented to avoid the appearance of impropriety so consumers can have confidence that they are not being cheated by the carriers.
The prevailing practice is for insurance carriers in New York to negotiate contracts with all of the major provider networks. These contracts include negotiated hospital rates which are then shown to their customers as proof that the customer is getting the best possible deal and the most "bang for the buck". The carriers do not advise customers about other language in the contracts. Specifically, carriers have been negotiating limitations on their ability to perform utilization review type activities. They will limit the number of cases that can be reviewed and place other restrictions on the process which serve to protect the provider. This can become a "quid pro quo" for the provider reducing their rates in the negotiation. The providers know that any losses they incur through negotiating lower rates will be made up by limiting review.
Through this process, the carriers and providers effectively become partners. The carriers understand that if they were to challenge billings and services through the review process, their business partner will be weakened and will not offer them the same reduced rates in the next negotiation. This could cause them to lose customers who are shopping for better rates. This clearly creates the appearance of a financial and professional relationship with the providers that is not in the best interests of consumers. Creating limitations on reviews or otherwise colluding to avoid taking money back from your business partner causes consumers to pay for unnecessary services and to overpay for Appropriate care.
A requirement that utilization and other healthcare type review can only be performed by independent groups who do not have a financial relationship with the providers will limit the possibility of conflicts of interest.
Prior legislative history
New Bill
Fiscal implications
None to the State.
Effective date
This act shall take effect immediately
Summaries, headlines and scores are AI-generated from the official bill text. How we score bills. Source: NYS Open Legislation.