Enacts provisions relating to collective negotiations by health care providers with certain health care plans in certain counties; applies to health benefit plans that provide benefits for medical or surgical expenses incurred as a result of a health condition, accident or sickness, including an individual, group, blanket or franchise insurance policy or insurance agreement offered by certain enumerated entities.
NEW YORK STATE ASSEMBLY MEMORANDUM IN SUPPORT OF LEGISLATION submitted in accordance with Assembly Rule III, Sec 1(f)
BILL NUMBER: A6019
SPONSOR: Paulin (MS)
TITLE OF BILL:
An act to amend the public health law, in relation to requirements for
collective negotiations by health care providers with certain health
PURPOSE OR GENERAL IDEA OF BILL:
This bill is designed to restore fairness in the contracting process
between physicians and large managed care plans by allowing doctors to
join together to negotiate contract provisions. This legislation would
not authorize strikes of health benefit plans by physicians.
SUMMARY OF SPECIFIC PROVISIONS:
Section 1 is a statement of legislative intent that states that the
Legislature finds it appropriate and necessary to authorize collective
negotiations on patient care issues and on fee-related and other issues,
where it determines that health plans have an undue advantage negotiat-
ing the terms of contracts with health care providers. The legislative
intent clarifies that the act is not intended to apply or affect collec-
tive bargaining relationships involving health care providers who are
employees of health care providers or rights relating to collective
bargaining arising under applicable federal/state collective bargaining
Section 2 cites the bill as the Health Care Consumer and Provider
Section 3 amends article 49 to the public health law by adding a new
title III titled Collective Negotiations by Health Care Providers with
Health Care Plans.
This legislation adds a new Article 49-A to the public health law to
authorize collective bargaining for independent contractor health care
providers including physicians or an entity that employs or utilizes
health care providers to provide health care services. This bill would
create a system under which the state would closely monitor those nego-
tiations, and any negotiations involving fee-related matters would only
be permitted when an individual managed care plan controls a substantial
share of the managed care market. The Commissioner of Health would be
authorized to approve the health care providers'-.representative request
to negotiate based upon the benefits to be achieved for providers and
consumers of health services and is required to review any offer submit-
ted to the health care providers' . representative prior to sharing with
affected health care providers. The legislation would also create a
mechanism for resolving disputes when there is an impasse or when the
health plan refuses to negotiate. The bill would also direct the Commis-
sioner of Health to approve any final agreement as wells monitor the
implemented agreements to ensure continued compliance with the law.
Importantly, this legislation would not authorize strikes or concerted
action by physicians in response to negotiations with health care plans.
Section 4 is the effective date.
Currently, federal antitrust laws prohibit individual physicians from
collectively negotiating any provisions of contracts they sign with
managed care entities. This bill would allow physicians in New York
State to conduct some collective negotiations by creating a system under
which the state would closely monitor those negotiations, facilitate
resolution of negotiation impasses, and actively monitor implementation
of agreements. Negotiations involving fee-related matters would be
prohibited unless an individual managed care plan controls a substantial
share of the managed care market.
Giving physicians greater ability to advocate for patients in contract
negotiations is critical since large health maintenance organizations
control huge shares of the health insurance market, both in New York and
across the country. In recent years we have seen the mergers of United
Healthcare and Oxford, MVP and Preferred Care, and Wellpoint with Well-
choice (Empire). As of March 2008, almost 75% of the enrollees in
managed care plans in New York State were enrolled in just five health
plans (GHWHIP, United/Oxford/Americhoice, Excellus, Empire and
MVP/Preferred Care). We have also seen an emerging trend of long-time
not-for-profit health insurance companies such as Empire and HIP seeking
to convert to for-profit status.
Due to the current imbalance of-negotiating power in favor of the
managed care plans, physicians and other health care providers are
offered take-it-or-leave-it contracts by health plans that significantly
hamper their ability to provide quality patient care. These contracts
permit burdensome processes and unjustifiably long wait times for
obtaining pre-authorization to provide needed patient care; impose limi-
tations on whom a physician may refer a patient for necessary care;
permit demands for refunds of payments long after the time that such
payments were originally made; permit health plans to make major changes
to key elements of a contract without physician consent; and cede to
physicians the legal consequences for patients harmed by health plan
utilization review decisions.
This bill, by allowing independent contractor physicians to conduct some
collective negotiations while being closely monitored by the state,
would give physicians greater ability to-advocate for patients in
contract negotiations. This bill would create a system under which the
state would closely monitor those negotiations, and any negotiations
involving fee-related matters would only be permitted when an individual
Managed care plan controls a substantial share of the managed care
market. This legislation would not authorize strikes or boycotts of
health benefit plans by physicians.
PRIOR LEGISLATIVE HISTORY:
2000: A.9484A - Referred to Health
2001-2002: A.5466 - Reported to Third Reading Calendar 2003-2004:
A.1317A - Reported to Ways and Means 2005-2006: A.6458 - Reported to
Ways and.Means 2007-2008: A.2177 - Reported to Ways and Means 2009-2010:
A.4301B- Reported to Ways and Means 2011-2012: A.2474B - Reported to
Ways and Means 2013-2014: A.5692 - Reported to Ways and Means 2015-2016:
A.33.6A - Reported to Ways and Means 2017-2018: A.4472 - Reported to
Ways and Means 2019-2020: A.2393 - Reported to Ways and Means 2021-2022:
A.951 - Referred to Health
None to the State. The bill would provide the legal basis for an appro-
priation of funds to implement the provisions of the bill.
120 days after it shall have become a law, provided that the department
of health may promulgate and establish any regulations pursuant hereto
prior to the effective date.
STATE OF NEW YORK
2023-2024 Regular Sessions
March 30, 2023
Introduced by M. of A. PAULIN, COLTON, MAGNARELLI, BRONSON, L. ROSEN-
THAL, THIELE, BENEDETTO, PEOPLES-STOKES, GUNTHER, WEPRIN, OTIS, AUBRY,
STIRPE, STECK, HUNTER, ZEBROWSKI, HEVESI, SIMON, ROZIC, JEAN-PIERRE,
TAYLOR, LAVINE, SAYEGH, SEAWRIGHT, REYES -- Multi-Sponsored by -- M.
of A. BRAUNSTEIN, CARROLL, COOK, DeSTEFANO, DINOWITZ, FAHY, GLICK,
LUPARDO, McDONOUGH, PRETLOW, RA -- 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
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. Statement of legislative intent. The legislature finds that
2 collective negotiation by competing health care providers for the terms
3 and conditions of contracts with health plans can result in beneficial
4 results for health care consumers. The legislature further finds
5 instances where health plans dominate the market to such a degree that
6 fair and adequate negotiations between health care providers and the
7 plans are adversely affected, so that it is necessary and appropriate to
8 provide for a system of collective action on behalf of health care
9 providers. Consequently, the legislature finds it appropriate and neces-
10 sary to displace competition with regulation of health plan-provider
11 agreements and authorize collective negotiations on the terms and condi-
12 tions of the relationship between health care plans and health care
13 providers so the imbalances between the two will not result in adverse
14 conditions of health care. This act is not intended to apply to or
15 affect in any respect collective bargaining relationships which arise
16 under applicable federal or state collective bargaining statutes.
17 § 2. This act shall be known and may be cited as the "health care
18 consumer and provider protection act".
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
 is old law to be omitted.
A. 6019 2
1 § 3. Article 49 of the public health law is amended by adding a new
2 title III to read as follows:
3 TITLE III
4 COLLECTIVE NEGOTIATIONS BY HEALTH CARE
5 PROVIDERS WITH HEALTH CARE PLANS
6 Section 4920. Definitions.
7 4921. Non-fee related collective negotiation authorized.
8 4922. Fee related collective negotiation.
9 4923. Collective negotiation requirements.
10 4924. Requirements for health care providers' representative.
11 4925. Certain collective action prohibited.
12 4926. Fees.
13 4927. Monitoring of agreements.
14 4928. Confidentiality.
15 4929. Severability and construction.
16 § 4920. Definitions. For purposes of this title:
17 1. "Health care plan" means an entity (other than a health care
18 provider) that approves, provides, arranges for, or pays for health care
19 services, including but not limited to:
20 (a) a health maintenance organization licensed pursuant to article
21 forty-three of the insurance law or certified pursuant to article
22 forty-four of this chapter;
23 (b) any other organization certified pursuant to article forty-four of
24 this chapter; or
25 (c) an insurer or corporation subject to the insurance law.
26 2. "Person" means an individual, association, corporation, or any
27 other legal entity.
28 3. "Health care providers' representative" means a third party who is
29 authorized by health care providers to negotiate on their behalf with
30 health care plans over contractual terms and conditions affecting those
31 health care providers.
32 4. "Strike" means a work stoppage in part or in whole, direct or indi-
33 rect, by a health care provider or health care providers to gain compli-
34 ance with demands made on a health care plan.
35 5. "Substantial market share in a business line" exists if a health
36 care plan's market share of a business line within the geographic area
37 for which a negotiation has been approved by the commissioner, alone or
38 in combination with the market shares of affiliates, exceeds either ten
39 percent of the total number of covered lives in that service area for
40 such business line or twenty-five thousand lives, or if the commissioner
41 determines the market share of the insurer in the relevant insurance
42 product and geographic markets for the services of the providers seeking
43 to collectively negotiate significantly exceeds the countervailing
44 market share of the providers acting individually.
45 6. "Health care provider" means a person who is licensed, certified,
46 registered or authorized pursuant to title eight of the education law
47 and who practices that profession as a health care provider as an inde-
48 pendent contractor and/or who is an owner, officer, shareholder, or
49 proprietor of a health care provider, or an entity that employs or
50 utilizes health care providers to provide health care services, includ-
51 ing but not limited to a hospital licensed under article twenty-eight of
52 this chapter or an accountable care organization under article twenty-
53 nine-E of this chapter; or an entity authorized under articles thirty-
54 six or forty of this chapter; or a fiscal intermediary operating pursu-
55 ant to section three hundred sixty-five-f of the social services law. A
56 health care provider under title eight of the education law who prac-
A. 6019 3
1 tices as an employee of a health care provider shall not be deemed a
2 health care provider for purposes of this title.
3 § 4921. Non-fee related collective negotiation authorized. 1. Health
4 care providers practicing within the geographic area for which a negoti-
5 ation has been approved by the commissioner may meet and communicate for
6 the purpose of collectively negotiating the following terms and condi-
7 tions of provider contracts with the health care plan:
8 (a) the details of the utilization review plan as defined pursuant to
9 subdivision ten of section forty-nine hundred of this article and
10 subsection (j) of section four thousand nine hundred of the insurance
12 (b) coverage provisions; health care benefits; benefit maximums,
13 including benefit limitations; and exclusions of coverage;
14 (c) the definition of medical necessity;
15 (d) the clinical practice guidelines used to make medical necessity
16 and utilization review determinations;
17 (e) preventive care and other medical management practices;
18 (f) drug formularies and standards and procedures for prescribing
19 off-formulary drugs;
20 (g) respective physician liability for the treatment or lack of treat-
21 ment of covered persons;
22 (h) the details of health care plan risk transfer arrangements with
24 (i) plan administrative procedures, including methods and timing of
25 health care provider payment for services;
26 (j) procedures to be utilized to resolve disputes between the health
27 care plan and health care providers;
28 (k) patient referral procedures including, but not limited to, those
29 applicable to out-of-network referrals;
30 (l) the formulation and application of health care provider reimburse-
31 ment procedures;
32 (m) quality assurance programs;
33 (n) the process for rendering utilization review determinations
34 including: establishment of a process for rendering utilization review
35 determinations which shall, at a minimum, include: written procedures to
36 assure that utilization reviews and determinations are conducted within
37 the timeframes established in this article; procedures to notify an
38 enrollee, an enrollee's designee and/or an enrollee's health care
39 provider of adverse determinations; and procedures for appeal of adverse
40 determinations, including the establishment of an expedited appeals
41 process for denials of continued inpatient care or where there is immi-
42 nent or serious threat to the health of the enrollee; and
43 (o) health care provider selection and termination criteria used by
44 the health care plan.
45 2. Nothing in this section shall be construed to allow or authorize an
46 alteration of the terms of the internal and external review procedures
47 set forth in law.
48 3. Nothing in this section shall be construed to allow a strike of a
49 health care plan by health care providers or plans as otherwise set
50 forth in the laws of this state.
51 4. Nothing in this section shall be construed to allow or authorize
52 terms or conditions which would impede the ability of a health care plan
53 to obtain or retain accreditation by the national committee for quality
54 assurance or a similar body.
55 § 4922. Fee related collective negotiation. 1. If the health care plan
56 has substantial market share in a business line in any geographic area
A. 6019 4
1 for which a negotiation has been approved by the commissioner, health
2 care providers practicing within that geographic area may collectively
3 negotiate the following terms and conditions relating to that business
4 line with the health care plan:
5 (a) the fees assessed by the health care plan for services, including
6 fees established through the application of reimbursement procedures;
7 (b) the conversion factors used by the health care plan in a
8 resource-based relative value scale reimbursement methodology or other
9 similar methodology; provided the same are not otherwise established by
10 state or federal law or regulation;
11 (c) the amount of any discount granted by the health care plan on the
12 fee of health care services to be rendered by health care providers;
13 (d) the dollar amount of capitation or fixed payment for health
14 services rendered by health care providers to health care plan enrol-
16 (e) the procedure code or other description of a health care service
17 covered by a payment and the appropriate grouping of the procedure
18 codes; or
19 (f) the amount of any other component of the reimbursement methodology
20 for a health care service.
21 2. Nothing herein shall be deemed to affect or limit the right of a
22 health care provider or group of health care providers to collectively
23 petition a government entity for a change in a law, rule, or regulation.
24 § 4923. Collective negotiation requirements. 1. Collective negotiation
25 rights granted by this title must conform to the following requirements:
26 (a) health care providers may communicate with other health care
27 providers regarding the contractual terms and conditions to be negoti-
28 ated with a health care plan;
29 (b) health care providers may communicate with health care providers'
31 (c) a health care providers' representative is the only party author-
32 ized to negotiate with health care plans on behalf of the health care
33 providers as a group;
34 (d) a health care provider can be bound by the terms and conditions
35 negotiated by the health care providers' representatives; and
36 (e) in communicating or negotiating with the health care providers'
37 representative, a health care plan is entitled to contract with or offer
38 different contract terms and conditions to individual competing health
39 care providers.
40 2. A health care providers' representative may not represent more than
41 thirty percent of the market of health care providers or of a particular
42 health care provider type or specialty practicing in the geographic area
43 for which a negotiation has been approved by the commissioner if the
44 health care plan covers less than five percent of the actual number of
45 covered lives of the health care plan in the area, as determined by the
47 3. Nothing in this section shall be construed to prohibit collective
48 action on the part of any health care provider who is a member of a
49 collective bargaining unit recognized pursuant to the national labor
50 relations act.
51 § 4924. Requirements for health care providers' representative. 1.
52 Before engaging in collective negotiations with a health care plan on
53 behalf of health care providers, a health care providers' representative
54 shall file with the commissioner, in the manner prescribed by the
55 commissioner, information identifying the representative, the represen-
A. 6019 5
1 tative's plan of operation, and the representative's procedures to
2 ensure compliance with this title.
3 2. Before engaging in the collective negotiations, the health care
4 providers' representative shall also submit to the commissioner for the
5 commissioner's approval a report identifying the proposed subject matter
6 of the negotiations or discussions with the health care plan and the
7 efficiencies or benefits expected to be achieved through the negoti-
8 ations for both the providers and consumers of health services. The
9 commissioner shall not approve the report if the commissioner, in
10 consultation with the superintendent of financial services determines
11 that the proposed negotiations would exceed the authority granted under
12 this title.
13 3. The representative shall supplement the information in the report
14 on a regular basis or as new information becomes available, indicating
15 that the subject matter of the negotiations with the health care plan
16 has changed or will change. In no event shall the report be less than
17 every thirty days.
18 4. With the advice of the superintendent of financial services and the
19 attorney general, the commissioner shall approve or disapprove the
20 report not later than the twentieth day after the date on which the
21 report is filed. If disapproved, the commissioner shall furnish a writ-
22 ten explanation of any deficiencies, along with a statement of specific
23 proposals for remedial measures to cure the deficiencies. If the commis-
24 sioner does not so act within the twenty days, the report shall be
25 deemed approved.
26 5. A person who acts as a health care providers' representative with-
27 out the approval of the commissioner under this section shall be deemed
28 to be acting outside the authority granted under this title.
29 6. Before reporting the results of negotiations with a health care
30 plan or providing to the affected health care providers an evaluation of
31 any offer made by a health care plan, the health care providers' repre-
32 sentative shall furnish for approval by the commissioner, before dissem-
33 ination to the health care providers, a copy of all communications to be
34 made to the health care providers related to negotiations, discussions,
35 and offers made by the health care plan.
36 7. A health care providers' representative shall report the end of
37 negotiations to the commissioner not later than the fourteenth day after
38 the date of a health care plan decision declining negotiation, canceling
39 negotiations, or failing to respond to a request for negotiation. In
40 such instances, a health care providers' representative may request
41 intervention from the commissioner to require the health care plan to
42 participate in the negotiation pursuant to subdivision eight of this
44 8. (a) In the event the commissioner determines that an impasse exists
45 in the negotiations, or in the event a health care plan declines to
46 negotiate, cancels negotiations or fails to respond to a request for
47 negotiation, the commissioner shall render assistance as follows:
48 (1) to assist the parties to effect a voluntary resolution of the
49 negotiations, the commissioner shall appoint a mediator from a list of
50 qualified persons maintained by the commissioner. If the mediator is
51 successful in resolving the impasse, then the health care providers'
52 representative shall proceed as set forth in this article;
53 (2) if an impasse continues, the commissioner shall appoint a fact-
54 finding board of not more than three members from a list of qualified
55 persons maintained by the commissioner, which fact-finding board shall
A. 6019 6
1 have, in addition to the powers delegated to it by the board, the power
2 to make recommendations for the resolution of the dispute;
3 (b) The fact-finding board, acting by a majority of its members, shall
4 transmit its findings of fact and recommendations for resolution of the
5 dispute to the commissioner, and may thereafter assist the parties to
6 effect a voluntary resolution of the dispute. The fact-finding board
7 shall also share its findings of fact and recommendations with the
8 health care providers' representative and the health care plan. If with-
9 in twenty days after the submission of the findings of fact and recom-
10 mendations, the impasse continues, the commissioner shall order a resol-
11 ution to the negotiations based upon the findings of fact and
12 recommendations submitted by the fact-finding board.
13 9. Any proposed agreement between health care providers and a health
14 care plan negotiated pursuant to this title shall be submitted to the
15 commissioner for final approval. The commissioner shall approve or
16 disapprove the agreement within sixty days of such submission.
17 10. The commissioner may collect information from other persons to
18 assist in evaluating the impact of the proposed arrangement on the
19 health care marketplace. The commissioner shall collect information from
20 health plan companies and health care providers operating in the same
21 geographic area.
22 § 4925. Certain collective action prohibited. 1. This title is not
23 intended to authorize competing health care providers to act in concert
24 in response to a report issued by the health care providers' represen-
25 tative related to the representative's discussions or negotiations with
26 health care plans.
27 2. No health care providers' representative shall negotiate any agree-
28 ment that excludes, limits the participation or reimbursement of, or
29 otherwise limits the scope of services to be provided by any health care
30 provider or group of health care providers with respect to the perform-
31 ance of services that are within the health care provider's scope of
32 practice, license, registration, or certificate.
33 § 4926. Fees. Each person who acts as the representative or negotiat-
34 ing parties under this title shall pay to the department a fee to act as
35 a representative. The commissioner, by rule, shall set fees in amounts
36 deemed reasonable and necessary to cover the costs incurred by the
37 department in administering this title. Any fee collected under this
38 section shall be deposited in the state treasury to the credit of the
39 general fund/state operations - 003 for the New York state department of
40 health fund.
41 § 4927. Monitoring of agreements. The commissioner shall actively
42 monitor agreements approved under this title to ensure that the agree-
43 ment remains in compliance with the conditions of approval. Upon
44 request, a health care plan or health care provider shall provide infor-
45 mation regarding compliance. The commissioner may revoke an approval
46 upon a finding that the agreement is not in substantial compliance with
47 the terms of the application or the conditions of approval.
48 § 4928. Confidentiality. All reports and other information required to
49 be reported to the department of law under this title including informa-
50 tion obtained by the commissioner pursuant to subdivision ten of section
51 forty-nine hundred twenty-four of this title shall not be subject to
52 disclosure under article six of the public officers law or article thir-
53 ty-one of the civil practice law and rules.
54 § 4929. Severability and construction. The provisions of this title
55 shall be severable, and if any court of competent jurisdiction declares
56 any phrase, clause, sentence or provision of this title to be invalid,
A. 6019 7
1 or its applicability to any government, agency, person or circumstance
2 is declared invalid, the remainder of this title and its relevant appli-
3 cability shall not be affected. The provisions of this title shall be
4 liberally construed to give effect to the purposes thereof.
5 § 4. This act shall take effect on the one hundred twentieth day after
6 it shall have become a law; provided that the commissioner of health is
7 authorized to promulgate any and all rules and regulations and take any
8 other measures necessary to implement this act on its effective date on
9 or before such date.