What's happening
This bill prohibits insurance contracts from requiring inclusion of all provider group members, certain network tiering, or restricting disclosure of fees.
Why it matters
Increases insurer flexibility and bargaining power. By stopping requirements to include all members of a provider group in an insurer’s network or tier, the bill allows insurers to be more selective, potentially helping them negotiate better rates or focus on higher-value providers, which could impact costs or quality for consumers.
Promotes consumer choice and cost transparency. The bill bans contract clauses that limit disclosure of provider fees or allowed amounts, making it easier for patients and referring providers to compare costs and make informed decisions about care.
Supports value-based care and benefit design innovation. By prohibiting provider contract terms that prevent insurers from designing benefits to steer patients toward higher-value providers, the bill encourages insurers to create insurance products that reward quality and efficiency over simple network inclusion.
Limits anti-competitive practices. Outlawing “most-favored-nation” provisions—where insurers or providers demand the best available rates compared to any other contract—can reduce the ability of dominant players to stifle competition, potentially leading to more competitive pricing and provider arrangements in the market.
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Who cares
Headline styles
Ban Unfair Insurance Requirements
Plain English, a few words. Used as the page title.
Sponsors
No co-sponsors yet.
History
- Referred to insurance
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 Unfair Insurance Clauses
In Senate Committee · Insurance · Sponsor Brian Benjamin
Full text
2 pagesUnderlined is new[Struck] is removedOfficial text on nysenate.gov ↗
STATE OF NEW YORK
9781
IN ASSEMBLY
February 11, 2020
Introduced by M. of A. HUNTER -- read once and referred to the Committee on Insurance
AN ACT to amend the insurance law and the public health law, in relation to prohibiting certain requirements in insurance contracts
The People of the State of New York, represented in Senate and Assembly, do enact as follows:
Section 1. Section 3217-b of the insurance law is amended by adding a new subsection (m) to read as follows:
(m)(1) No insurer that offers a managed care product or a comprehensive policy that utilizes a network of providers shall enter into a contract, written policy, written procedure or agreement with any health care provider that:
(A) Requires an insurer to include all members of a provider group, including medical practice groups and facilities, in its network of participating providers;
(B) Requires an insurer to place all members of a provider group, including medical practice groups and facilities, in the same network tier;
(C) Requires an insurer to include all members of a provider group, including medical practice groups and facilities, in all products offered by the insurer;
(D) Prohibits insurers from using benefit designs to encourage members to seek services from higher-value health care providers;
(E) Contains a most-favored-nation provision; provided, however, nothing in this section shall be construed to prohibit a health insurer and a provider from negotiating payment rates and performance-based contract terms that would result in the insurer receiving a rate that is as favorable, or more favorable, than the rates negotiated between a health care provider and another entity; and
(F) Limits the ability of the insurer or health care provider from disclosing fees for services or the allowed amounts to an insured or insured's health care provider.
(2) After January first, two thousand twenty-one, any contract, written policy, written procedure or agreement that contains a clause
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD15287-01-0
A. 9781 2
contrary to the provisions set forth in this section shall be null and void; provided, however, the remaining clauses of the contract shall remain in effect for the duration of the contract term.
§ 2. Section 4406 of the public health law is amended by adding a new subdivision 6 to read as follows:
6. (a) No health maintenance organization that offers a managed care product or a comprehensive policy that utilizes a network of providers shall enter into a contract, written policy, written procedure or agreement with any health care provider that:
(i) Requires an insurer to include all members of a provider group, including medical practice groups and facilities, in its network of participating providers;
(ii) Requires an insurer to place all members of a provider group, including medical practice groups and facilities, in the same network tier;
(iii) Requires an insurer to include all members of a provider group, including medical practice groups and facilities, in all products offered by the insurer;
(iv) Prohibits insurers from using benefit designs to encourage members to seek services from higher-value health care providers;
(v) Contains a most-favored-nation provision; provided, however, nothing in this section shall be construed to prohibit a health insurer and a provider from negotiating payment rates and performance-based contract terms that would result in the insurer receiving a rate that is as favorable, or more favorable, than the rates negotiated between a health care provider and another entity; and
(vi) Limits the ability of the insurer or health care provider from disclosing fees for services or the allowed amounts to an insured or insured's health care provider.
(b) After January first, two thousand twenty-one, any contract, written policy, written procedure or agreement that contains a clause contrary to the provisions set forth in this section shall be null and void; provided, however, the remaining clauses of the contract shall remain in effect for the duration of the contract term.
§ 3. This act shall take effect on January 1, 2021.
Reflowed for reading: line numbers and page breaks removed. Cite the official text.
Summaries, headlines and scores are AI-generated from the official bill text. How we score bills. Source: NYS Open Legislation.