senate Bill S4624A

Authorizes the Nassau health care corporation to enter into contracts and arrangements providing for the creation and operation of a delivery system network

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Bill Status


  • Introduced
  • In Committee
  • On Floor Calendar
    • Passed Senate
    • Passed Assembly
  • Delivered to Governor
  • Signed/Vetoed by Governor
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actions

  • 16 / Apr / 2013
    • REFERRED TO CORPORATIONS, AUTHORITIES AND COMMISSIONS
  • 17 / Jun / 2013
    • AMEND AND RECOMMIT TO CORPORATIONS, AUTHORITIES AND COMMISSIONS
  • 17 / Jun / 2013
    • PRINT NUMBER 4624A
  • 20 / Jun / 2013
    • COMMITTEE DISCHARGED AND COMMITTED TO RULES
  • 20 / Jun / 2013
    • ORDERED TO THIRD READING CAL.1487
  • 20 / Jun / 2013
    • SUBSTITUTED BY A7993A

Summary

Authorizes the Nassau health care corporation to enter into contracts and arrangements providing for the creation and operation of a health care delivery system network.

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Bill Details

See Assembly Version of this Bill:
A7993A
Versions:
S4624
S4624A
Legislative Cycle:
2013-2014
Law Section:
Public Authorities Law
Laws Affected:
Amd §3405, Pub Auth L

Sponsor Memo

BILL NUMBER:S4624A

TITLE OF BILL: An act to amend the public authorities law, in
relation to authorizing the Nassau health care corporation to enter
into agreements for the creation and operation of a health care
delivery system network

PURPOSE: To clarify that Nassau Health Care Corporation may exercise
its general and special powers regardless of whether such exercise
might have an impact on competition.

SUMMARY OF PROVISIONS:

Section one adds a new subsection three to § 3401 of the Public
Authorities Law to provide further information regarding the
legislative purpose and findings. This provision provides that as a
free-standing public health care provider, the Nassau Health Care
Corporation (NHCC) is at a competitive disadvantage in the emerging
health care environment, which jeopardizes its ability to provide
quality health care services to medically underserved populations.
Thus, the state authorizes the corporation to engage in collaborative
activities consistent with its health care purposes.

Section two adds a new subsection 10 to § 3405 of the Public
Authorities Law to clarify that in carrying out its health care
purposes, the NHCC may engage in arrangements, contracts, information
sharing, and other collaborative activities with public or private
entities and individuals including joint ventures and joint
negotiations with physicians, hospitals and payors. Such negotiations
may result in separate or combined agreements, leases and/or
activities involving delivery system network creation and operation
that may displace competition and might otherwise be considered
violations of state or federal antitrust laws. This provision provides
the necessary legislative declaration for the activities of the
corporation and of the private entities and individuals with which it
collaborates, to be immunized from liability under federal and state
antitrust laws. The corporation and its collaborators shall remain
subject to generally applicable provisions of the Public Health Law,
notwithstanding any provisions herein. The corporation also must file
an annual report with the Department of Health concerning the impact
of the collaborations authorized under this section and concerning the
impact on reimbursement to the corporation's facilities by managed
care organizations. The Department shall then have 60 days to request
that the corporation make changes to its policies to further the
interests of the state.

Section two provides the act shall take effect immediately.

JUSTIFICATION: The NHCC, created under the Public Authorities Law,
assumed responsibility for operation of Nassau University Medical
Center (NUMC), a general hospital, in September of 1999. Likewise NUMC
assumed responsibility for operation of the A. Holly Patterson
Extended Care Facility (AHP), a skilled nursing facility and several
Community Health Centers (CHCs). All such facilities had previously
been operated by Nassau County. NHCC's facilities provide an extensive
range of acute care, nursing home, and ambulatory services to an
indigent population in Nassau County. NUMC provides more than 50% of


the Medicaid discharges in Nassau County and is the primary provider
of ambulatory care to the County's Medicaid and indigent population.
As a free-standing public healthcare entity, NHCC faces unique
challenges as it seeks to carry out its mission as a safety-net
facility. In particular, its ability to collaborate with private
entities and individuals is clear in the general and special powers
granted to it under Public Authorities Law §§ 3404 and 3405. However,
in a recent Supreme Court decision FTC v. Phoebe Putney Health System,
Inc, the Court held that in order for state action immunity to apply
the state must clearly articulate and affirmative ly express a policy
to displace competition. Therefore, NHCC seeks to clarify the state's
intention that such collaborations may be carried out regardless of
whether they displace competition and may otherwise be considered
violations of state or federal antitrust laws.

LEGISLATIVE HISTORY: New bill.

FISCAL IMPLICATIONS: None.

EFFECTIVE DATE: Immediately.

view bill text
                    S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                 4624--A

                       2013-2014 Regular Sessions

                            I N  S E N A T E

                             April 16, 2013
                               ___________

Introduced  by  Sen.  HANNON -- read twice and ordered printed, and when
  printed to be committed to the Committee on Corporations,  Authorities
  and   Commissions  --  committee  discharged,  bill  amended,  ordered
  reprinted as amended and recommitted to said committee

AN ACT to amend the public authorities law, in relation  to  authorizing
  the  Nassau  health  care corporation to enter into agreements for the
  creation and operation of a health care delivery system network

  THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section  1.   Section 3401 of the public authorities law is amended by
adding a new subdivision 3 to read as follows:
  3. AS A FREE-STANDING PUBLIC HEALTH CARE PROVIDER, THE CORPORATION  IS
AT  A  COMPETITIVE  DISADVANTAGE IN THE CURRENT AND EMERGING HEALTH CARE
ENVIRONMENT, YET IT CANNOT BECOME PART OF A LARGER SYSTEM  OF  CORPORATE
ENTITIES WHILE MAINTAINING ITS PUBLIC STATUS. SIGNIFICANT INVESTMENTS IN
THE  PUBLIC  ASSETS  OF  THE CORPORATION AND ITS EFFORTS TO PROVIDE HIGH
QUALITY HEALTH CARE SERVICES TO MEDICALLY  UNDERSERVED  POPULATIONS  ARE
JEOPARDIZED  BY THE CORPORATION'S INABILITY TO COMPETE ON ITS OWN AND BY
POTENTIAL LIMITS ON ITS ABILITY TO COLLABORATE  WITH  OTHER  PUBLIC  AND
PRIVATE  PROVIDERS,  ENTITIES  AND INDIVIDUALS. THE STATE FINDS THAT THE
BENEFITS OF COLLABORATION BY THE CORPORATION OUTWEIGH ANY ADVERSE IMPACT
ON COMPETITION. THE BENEFITS OF THE CORPORATION'S COLLABORATIVE  EFFORTS
INCLUDE  PRESERVING  AND  EXPANDING  NEEDED  HEALTH CARE SERVICES IN ITS
PRIMARY SERVICE AREA; CONSOLIDATING UNNEEDED OR DUPLICATIVE HEALTH  CARE
SERVICES; ENHANCING THE QUALITY OF, AND EXPANDING ACCESS TO, HEALTH CARE
DELIVERED  TO  MEDICALLY  UNDERSERVED  POPULATIONS;  LOWERING  COSTS AND
IMPROVING THE EFFICIENCY OF THE HEALTH CARE SERVICES  IT  DELIVERS;  AND
ACHIEVING  IMPROVED REIMBURSEMENT FROM NON-GOVERNMENTAL PAYORS. BASED ON
THE FINDINGS CONTAINED IN THIS SECTION, THE STATE  HEREBY  AFFIRMATIVELY
EXPRESSES  A  POLICY TO ALLOW THE CORPORATION TO ENGAGE IN COLLABORATIVE
ACTIVITIES CONSISTENT WITH ITS  HEALTH  CARE  PURPOSES,  NOTWITHSTANDING

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD10327-03-3

S. 4624--A                          2

THAT  THOSE COLLABORATIONS MAY HAVE THE EFFECT OF DISPLACING COMPETITION
IN THE PROVISION OF HOSPITAL, PHYSICIAN  OR  OTHER  HEALTH  CARE-RELATED
SERVICES.   WITH RESPECT TO THE COLLABORATIVE ACTIVITIES CONTEMPLATED IN
THIS  SECTION AND IN SUBDIVISION TEN OF SECTION THIRTY-FOUR HUNDRED FIVE
OF THIS TITLE, THE CORPORATION AND THE PUBLIC OR  PRIVATE  ENTITIES  AND
INDIVIDUALS WITH WHICH IT COLLABORATES SHALL BE IMMUNIZED FROM LIABILITY
UNDER THE FEDERAL AND STATE ANTITRUST LAWS.
  S 2. Section 3405 of the public authorities law is amended by adding a
new subdivision 10 to read as follows:
  10.  (A) IN CARRYING OUT ITS HEALTH CARE PURPOSES THROUGH THE EXERCISE
OF THE SPECIAL POWERS EXERCISED PURSUANT TO THIS SECTION AND THE GENERAL
POWERS EXERCISED PURSUANT TO SECTION THIRTY-FOUR HUNDRED  FOUR  OF  THIS
TITLE,   THE  CORPORATION  IS  AUTHORIZED  TO  ENGAGE  IN  ARRANGEMENTS,
CONTRACTS, INFORMATION SHARING AND OTHER COLLABORATIVE  ACTIVITIES  WITH
PUBLIC  OR  PRIVATE ENTITIES AND INDIVIDUALS IRRESPECTIVE OF THE COMPET-
ITIVE CONSEQUENCES OF THESE ACTIVITIES AND  NOTWITHSTANDING  THAT  THESE
ACTIVITIES  MAY  HAVE  THE  EFFECT  OF  DISPLACING  COMPETITION  IN  THE
PROVISION OF HOSPITAL, PHYSICIAN, OR OTHER HEALTH CARE-RELATED SERVICES.
THESE COLLABORATIVE ACTIVITIES MAY  INCLUDE  WITHOUT  LIMITATION:  JOINT
VENTURES;  JOINT  NEGOTIATIONS  WITH  PHYSICIANS,  HOSPITALS AND PAYORS,
WHETHER SUCH NEGOTIATIONS RESULT IN  SEPARATE  OR  COMBINED  AGREEMENTS;
LEASES; AND/OR AGREEMENTS WHICH INVOLVE DELIVERY SYSTEM NETWORK CREATION
AND OPERATION, PROVIDED THAT, THE CORPORATION SHALL EXERCISE STATE OVER-
SIGHT  BY  DETERMINING  WHETHER PARTICULAR COLLABORATIONS WITH PUBLIC OR
PRIVATE ENTITIES AND INDIVIDUALS FURTHER THE INTERESTS OF THE  STATE  AS
SET  FORTH IN THIS SUBDIVISION AND IN SUBDIVISION THREE OF SECTION THIR-
TY-FOUR HUNDRED ONE OF THIS TITLE. IN  UNDERTAKING  THESE  COLLABORATIVE
ACTIVITIES, THE CORPORATION AND THE PUBLIC OR PRIVATE ENTITIES AND INDI-
VIDUALS  WITH  WHICH  IT  COLLABORATES SHALL BE IMMUNIZED FROM LIABILITY
UNDER THE FEDERAL AND STATE ANTITRUST LAWS.
  (B) NOTWITHSTANDING THE PROVISIONS OF THIS  SECTION,  THE  CORPORATION
AND  ITS  COLLABORATORS  SHALL  REMAIN  SUBJECT  TO GENERALLY APPLICABLE
PROVISIONS OF THE PUBLIC HEALTH LAW AND REGULATIONS THEREUNDER. IN ADDI-
TION, THE CORPORATION SHALL FILE AN ANNUAL REPORT WITH THE STATE DEPART-
MENT OF HEALTH, AS ADDITIONAL STATE OVERSIGHT, CONCERNING THE IMPACT  OF
THE  COLLABORATIONS  AUTHORIZED UNDER THIS SECTION ON THE ADVANTAGES AND
DISADVANTAGES IDENTIFIED BY THE DEPARTMENT OF HEALTH IN ITS REQUEST  FOR
APPLICATIONS  FOR  HEAL NY PHASE 21, ENTITLED "RESTRUCTURING INITIATIVES
IN MEDICAID REDESIGN," AND CONCERNING THE IMPACT ON REIMBURSEMENT TO THE
CORPORATION'S FACILITIES BY MANAGED CARE ORGANIZATIONS WITH  RESPECT  TO
COMMERCIAL  PLAN  MEMBERS, INCLUDING THE EXTENT TO WHICH RATES HAVE BEEN
NEGOTIATED THAT MORE FAIRLY COMPENSATE THE CORPORATION'S FACILITIES  FOR
THE   COST  OF  PROVIDING  SERVICES  TO  COMMERCIAL  ENROLLEES,  WITHOUT
CROSS-SUBSIDY FROM MEDICAID OR OTHER GOVERNMENTAL PROGRAMS. IN  RESPONSE
TO  THE REPORT, THE DEPARTMENT OF HEALTH SHALL HAVE SIXTY DAYS AFTER THE
REPORT HAS BEEN FILED TO REQUEST, IN WRITING, THAT THE CORPORATION  MAKE
CHANGES  TO  ITS  POLICIES  TO ENSURE THAT THE COLLABORATIONS AUTHORIZED
UNDER THIS SECTION FURTHER THE INTERESTS OF THE STATE.
  S 3. This act shall take effect immediately.

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