What's happening
This bill defines health service providers for motor vehicle insurance and restricts durable medical equipment claims to approved suppliers.
Why it matters
Clarifies who can submit insurance claims. By explicitly defining "health service provider," the bill sets clear boundaries on which professionals and suppliers are eligible to bill for services under motor vehicle insurance, potentially reducing fraudulent or inappropriate claims.
Adds quality controls for equipment suppliers. Limiting durable medical equipment claims to suppliers approved by the National Supplier Clearinghouse (i.e., authorized Medicare suppliers) aims to ensure that only vetted, reputable sources provide this equipment, which could improve patient safety and reduce insurance costs.
Increases transparency and accountability. Requiring that invoices for durable medical equipment include specific make and model numbers helps prevent inflated or vague billing, making it easier for insurers to verify claims and for patients to know exactly what is being provided.
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Who cares
Headline styles
Tighten Medical Equipment Rules
Plain English, a few words. Used as the page title.
Sponsors
1 Co-sponsor
History
- Referred to insurance
- Referred to insurance
Full text
2 pagesUnderlined is new[Struck] is removedOfficial text on nysenate.gov ↗
STATE OF NEW YORK
3510
2019-2020 Regular Sessions
IN SENATE
February 8, 2019
Introduced by Sens. BRESLIN, SEWARD -- read twice and ordered printed, and when printed to be committed to the Committee on Insurance
AN ACT to amend the insurance law, in relation to coverage for certain benefits under comprehensive motor vehicle insurance
The People of the State of New York, represented in Senate and Assembly, do enact as follows:
Section 1. Section 5102 of the insurance law is amended by adding a new subsection (n) to read as follows:
(n) "Health service provider" means any medical provider or durable medical equipment supplier that submits a bill for payment under benefits defined and provided by this section for any of the following:
(1) medical, hospital (including services rendered in compliance with article forty-one of the public health law, whether or not such services are rendered directly by a hospital), surgical, nursing, dental, ambulance, x-ray, prescription drug and prosthetic services or equipment;
(2) psychiatric, physical therapy (provided that treatment is rendered pursuant to a referral) and occupational therapy and rehabilitation;
(3) any nonmedical remedial care and treatment rendered in accordance with a religious method of healing recognized by the laws of this state; and
(4) any other professional health services.
§ 2. The insurance law is amended by adding a new section 5110 to read as follows:
§ 5110. Charges for durable medical equipment. (a) A covered person shall not assign claims for medical expenses under this article to a health service provider for durable medical equipment unless the health service provider has been approved by the National Supplier Clearinghouse as an authorized Medicare supplier of durable medical equipment, prosthetics, orthotics and supplies. For purposes of this section, durable medical equipment includes, but is not limited to, durable
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD09652-01-9
S. 3510 2
medical equipment and supplies, medical/surgical supplies, orthopedic footwear and orthotic and prosthetic appliances.
(b) No health service provider shall be eligible to demand or request payment from an insurer for durable medical equipment unless the make and model number of the equipment is set forth on the invoice for the equipment.
§ 3. This act shall take effect immediately.
Reflowed for reading: line numbers and page breaks removed. Cite the official text.
Sponsor's memo
Title of bill
An act to amend the insurance law, in relation to coverage for certain benefits under comprehensive motor vehicle insur- ance
Purpose
The purpose of this legislation is to eliminate the assignment of bene- fits for durable medical equipment in the no-fault system.
Summary of provisions
Section 1 adds a new subSection (n) to section 5102 of the insurance law to define "health service provider."
Section 2 adds a new section 5110 to the insurance law to prohibit the assignment of benefits for durable medical equipment to a health service provider unless the health service provider has been approved by the National Supplier Clearinghouse as an authorized Medicare supplier of durable medical equipment, prosthetics, orthotics and supplies. Durable equipment includes, but is not limited to, durable medical equipment and supplies, medical/surgical supplies, orthopedic footwear and orthotic and prosthetic appliances.
Justification
In recent years an increasing portion of the no-fault fraud has been observed in the area of durable medical equipment (DME). In many instances the DME wholesaler is involved in the scam and the provider is committing fraud in conjunction with the medical supply companies. Many of these DME frauds occur in the following manner.
Many items are subject to the fee schedule. Items not subject to the fee schedule are billed at a rate of 50% over cost. However, the wholesaler will often fabricate a price, and then add on the 50% profit. For exam- ple, TENS & EMS machines (which emit electrical impulses) perform nearly the same functions. Until last year TENS machines were not subject to the fee schedule, so TENS and EMS billing was relatively equal. However, last year TENS machines were put on the fee schedule. It is no coinci- dence that no-fault fraudsters are reducing TENS billings and EMS bill- ings have dramatically increased so that these fraudsters can fabricate a price and then add in the 50% profit on top.
As is readily seen by these cases, this area of no-fault fraud is ramp- ant and growing at a tremendous rate producing the fastest and most cash profit of any fraud. Since Jan 1, 2009, there have been 739 new DME providers registered in NYS. There were 340 new facilities registered in Brooklyn alone but only 10 in Buffalo.
In one especially egregious case, one patient's DME billing included 16 different items totaling over $6,000 including a luxury turbo bath spa, an infrared heat wand, a wand massager, two different post-op knee brac- es, a back support seat, a TENS belt and others. The patient reports that they never used any of the items which were billed for.
This legislation is not unique in prohibiting assignment of benefits for a lawful no-fault expense. Assignment of benefits for transportation expenses was originally allowed but the no-fault system quickly saw an explosive rise in those expenses. The Insurance Department amended the no-fault regulations to prohibit assignment of benefits for transporta- tion and the expenses fell very quickly. Prohibiting assignment of benefits to health providers for DME should see the same outcome while still allowing the no-fault claimant to directly receive payment for their legitimate DME needs.
Legislative history
S.769 of 2017-18; S.1673 of 2015-16; S.3540 of 2013-14; S.5064-A of 2011-12
Fiscal implications
None to State.
Effective date
Immediately.
Summaries, headlines and scores are AI-generated from the official bill text. How we score bills. Source: NYS Open Legislation.