What's happening
This bill amends insurance law to require motor vehicle injury treatments and reimbursements to follow specific treatment guidelines and fee schedules, with options for arbitration of disputes.
Why it matters
Standardizes Treatment and Reimbursement. By requiring providers to follow specific treatment guidelines and fee schedules set by the Workers’ Compensation Board, the bill aims to create consistency in the types of treatments given and the prices paid, reducing variability and potential overcharging.
Limits Provider Billing and Reimbursement. Health service providers cannot demand payment above the set fee schedules, and they must comply with the treatment guidelines to be reimbursed at all—potentially lowering costs for insurers and, indirectly, for policyholders.
Controls and Reviews Deviations from Guidelines. Providers seeking to deviate from established guidelines must justify the need in writing and face reduced reimbursement (maximum 50%) if they do not follow procedure, which could discourage unnecessary or experimental treatments and increase oversight.
Dispute Resolution and Arbitration. The bill establishes an expert panel arbitration process for disputes over treatment deviations, aiming to resolve conflicts more efficiently and with greater expertise, which may reduce litigation and speed up claim settlements.
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Who cares
No-fault health care providers
The bill would require compliance with treatment guidelines and advance requests justifying deviations, with reimbursement limited for failing to submit a request.
Auto insurers
The bill would prohibit payments above workers’ compensation fee schedules, allow independent medical examinations at any time during treatment and permit peer review of guideline deviations.
People receiving no-fault medical care
The bill would subject treatment to new guidelines and exclude services or supplies outside those guidelines or the workers’ compensation fee schedule from compensation.
State insurance regulators
The superintendent would have to establish treatment guidelines after consulting with the Workers’ Compensation Board and health commissioner, and provide simplified arbitration procedures for deviation disputes.
Headline styles
Standardize No-Fault Treatment 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
3514
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 providing for the use of treatment guidelines under the comprehensive motor vehicle reparations act
The People of the State of New York, represented in Senate and Assembly, do enact as follows:
Section 1. Section 5108 of the insurance law is amended to read as follows:
§ 5108. Limit on charges by providers of health services. (a) The charges for services specified in paragraph one of subsection (a) of section five thousand one hundred two of this article and any further health service charges which are incurred as a result of the injury and which are in excess of basic economic loss, shall not exceed the charges permissible under the schedules prepared and established by the chairman of the workers' compensation board for industrial accidents, except where the insurer or arbitrator determines that unusual procedures or unique circumstances justify the excess charge, and shall be subject to the treatment guidelines established pursuant to subsection (d) of this section. At no time shall an insurer pay any charge that exceeds the charges permissible under the schedule prepared and established by the chair of the workers' compensation board.
(b) The superintendent, after consulting with the chairman of the workers' compensation board and the commissioner of health, shall promulgate rules and regulations implementing and coordinating the provisions of this article and the workers' compensation law with respect to charges for the professional health services specified in paragraph one of subsection (a) of section five thousand one hundred two of this article, including the establishment of schedules for all such services for which schedules have not been prepared and established by the chairman of the workers' compensation board, including, but not
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD09661-01-9
S. 3514 2
limited to, durable medical equipment or supplies. Additionally, the superintendent, after consultation with the workers' compensation board and the commissioner of health, shall promulgate treatment guidelines with respect to treating covered persons. Charges for services that are not specifically scheduled by the superintendent of insurance or the chairman of the workers' compensation board, or are not compensable charges under Medicare are not compensable health service charges under subsection (a) of section five thousand one hundred two of this article.
(c) No provider of health services specified in paragraph one of subsection (a) of section five thousand one hundred two of this article may demand or request any payment in addition to the charges authorized pursuant to this section. No such provider may be reimbursed for any services unless the provider complies with subsection (d) of this section. Every insurer shall report to the commissioner of health any patterns of overcharging, excessive treatment or other improper actions by a health provider within thirty days after such insurer has knowledge of such pattern.
(d) Notwithstanding any other provision of statute, rule or regulation to the contrary, the following shall apply for all individuals or entities that provide, treat, or charge for services specified in paragraph one of subsection (a) of section five thousand one hundred two of this article:
(1) The treating provider shall follow the treatment guidelines established by the superintendent;
(2) Deviations from the treatment guidelines may be permitted under the following conditions:
(i) prior written or electronic request is given to the insurer prior to commencing treatment. The request shall contain justification for the deviation from the treatment guidelines. The burden of showing the necessity of the deviation remains solely on the treating provider. Failure to provide this request shall result in a maximum reimbursement of fifty percent of the treatment guidelines.
(ii) the insurer shall not be precluded from evaluating the deviation for payment during the pendency of the review, and may utilize peer review for evaluation of the deviation.
(iii) any disputes shall be resolved through a panel of experts who have been trained or certified in the treatment guidelines pursuant to subsection (e) of section five thousand one hundred six of this article.
(3) An insurer may schedule an independent medical examination at any time during the course of treatment.
(4) Services or supplies not covered by the treatment guidelines or the workers' compensation fee schedule shall not be compensable.
§ 2. Section 5106 of the insurance law is amended by adding a new subsection (e) to read as follows:
(e) Every insurer shall provide the treating provider with the option of submitting a dispute involving a request for deviations from the treatment guidelines under subsection (d) of section five thousand one hundred eight of this article to arbitration pursuant to simplified procedures promulgated or approved by the superintendent. Such simplified procedures shall include arbitration through a panel of experts who have been trained or certified in the treatment guidelines.
§ 3. This act shall take effect immediately and shall apply to all actions and proceedings commenced on or after such date; and shall also apply to any action or proceeding which was commenced prior to such effective date where, as of such date, a trial of the issues has not yet commenced.
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 providing for the use of treatment guidelines under the comprehensive motor vehicle reparations act
Purpose
To eliminate fraudulent and unnecessary medical treatment in the no-fault system.
Summary of provisions
Section 1 of this bill would require the establishment of treatment guidelines for medical treatment provided under the no-fault system.
Read the full memo (618 words)
Section 2 of this bill would provide an expedited process for the resol- ution of disputes regarding deviations from the treatment guidelines.
Section 3 of the bill is the effective date.
Justification
On February 29, 2012, the Manhattan U.S. Attorney announced the indict- ment of 36 people for participating in a $279 million no-fault fraud scheme involving fraudulent medical clinics (medical mills). One of the reasons why medical mills proliferate in New York is because New York's no-fault system makes it very easy to bill insurance companies for frau- dulent and unnecessary treatment. This bill would remedy this situation by establishing guidelines for the treatment of various injuries common- ly sustained in automobile accidents.
Treatment guidelines have been adopted in New Jersey for its no-fault system and in New York for the workers compensation system. Treatment guidelines are a valuable tool in preventing the fraudulent overutiliza- tion of unnecessary medical treatments. Treatment guidelines are evidence based standards of care and best practices for the medical treatment of injuries which ensure that claimants receive the highest quality medical treatment. In the workers compensation context, the guidelines were initially developed by the Governor's Workers' Compen- sation Reform Task Force and its advisory committee comprised of well credentialed medical professionals and other interested parties. This bill would require similar scientifically based guidelines to be devel- oped for the treatment of injuries commonly resulting from auto acci- dents. These guidelines would ensure that auto accident victims would receive the best care for their injuries and, because the guidelines set forth clear standards for treatment, they would significantly reduce fraud and abuse in the no-fault system. Establishing treatment guide- lines would go a long way toward putting an end to medical mills in New York State.
New York's no fault system is plagued by fraud and abuse which is adding significant costs to auto premiums in New York and a major contributing factor making New Yorkers pay among the highest auto insurance premiums in the nation. In fact, a recent Insurance Research Council study found that in the New York City area, about one in every five no-fault auto insurance claims closed in 2010 appear to have elements of fraud. In addition, New York's no-fault claim costs have far outpaced that of other no-fault states and the overall cost of medical care. From 2004 through the 2nd Quarter of 2010, the average PIP claim cost rose 60.4 percent in New York, nearly 42 points faster than the 18.6 percent growth rate in the Consumer Price Index cost of medical goods and services found in the region. The cost of no-fault personal injury protection (PIP) coverage has also soared. New York's average no-fault PIP claim cost $9,007 is the third highest in the nation as of 2nd quar- ter 2010. Establishing treatment guidelines for the no-fault system would assist in reducing fraud in the no-fault system and the costs associated with fraud.
Legislative history
S.780 of 2017-18; S.2370 of 2015-16; S.3546 of 2013-14; S.6706 of 2011-12
Fiscal implications
None.
Effective date
Immediately and shall apply to all actions and proceedings commenced on or after such date; and shall also apply to any action or proceeding which was commenced prior to such effective date where, as of such date, a trial of the issues has not yet commenced.
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