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

                                  3340

                       2009-2010 Regular Sessions

                          I N  A S S E M B L Y

                            January 27, 2009
                               ___________

Introduced  by  M.  of  A.  BRADLEY,  J. RIVERA, MAISEL, PAULIN, FIELDS,
  JAFFEE, GUNTHER, ROBINSON, MILLMAN, ZEBROWSKI -- Multi-Sponsored by --
  M.  of  A.  BOYLAND,  COOK,  EDDINGTON,   GALEF,   GLICK,   GOTTFRIED,
  HYER-SPENCER,  MAYERSOHN, REILLY, SCHIMEL, SWEENEY, WEISENBERG -- read
  once and referred to the Committee on Insurance

AN ACT to amend the insurance law, in relation to processing  of  health
  claims and overpayments to certain health care providers

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

  Section 1. Section 3224-b of the insurance law, as  added  by  chapter
551 of the laws of 2006, is amended to read as follows:
  S  3224-b. Rules relating to the processing of health claims and over-
payments to physicians AND GENERAL HOSPITALS. (a) Processing  of  health
care  claims.  This  subsection  is  intended  to provide uniformity and
consistency in the reporting of medical services and procedures as  they
relate  to  the  processing of health care claims and is not intended to
dictate reimbursement policy.
  (1) For purposes of this section, a "health plan" shall be defined  as
an  insurer  that is licensed to write accident and health insurance, or
that is licensed pursuant to article forty-three of this chapter  or  is
certified  pursuant to article forty-four of the public health law.  THE
TERM "GENERAL HOSPITAL" SHALL HAVE THE SAME MEANING AS IN ARTICLE  TWEN-
TY-EIGHT OF THE PUBLIC HEALTH LAW.
  (2) Subject to the provisions of paragraph three of this subsection, a
health  plan shall accept and initiate the processing of all health care
claims submitted by a physician OR A GENERAL HOSPITAL  pursuant  to  and
consistent  with  the  current  version  of the American medical associ-
ation's current procedural terminology (CPT) codes, reporting guidelines
and conventions and the  centers  for  medicare  and  medicaid  services
healthcare common procedure coding system (HCPCS).
  (3)  Nothing  in this section shall preclude a health plan from deter-
mining that any such claim is not eligible for payment, in  full  or  in
part,  based  on  a determination that: (i) the claim is not complete as
defined by 11 NYCRR 217; (ii) the service  provided  is  not  a  covered

              

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD03535-01-9

A. 3340                             2

benefit under the contract or agreement, including but not limited to, a
determination  that such service is not medically necessary or is exper-
imental or investigational; (iii) the insured did not obtain a referral,
pre-certification  or  satisfy  any other condition precedent to receive
covered benefits from the physician; (iv) the  covered  benefit  exceeds
the  benefit  limits of the contract or agreement; (v) the person is not
eligible for coverage or is otherwise not compliant with the  terms  and
conditions  of his or her contract; (vi) another insurer, corporation or
organization is liable for all or part of the claim; or (vii)  the  plan
has  a  reasonable  suspicion of fraud or abuse. In addition, nothing in
this section shall be deemed to require a health plan to  pay  or  reim-
burse  a  claim, in full or in part, or dictate the amount of a claim to
be paid by a health plan to a physician OR GENERAL HOSPITAL.
  (4) Every health plan shall publish on its provider website and in its
provider newsletter the name of the commercially available claims  edit-
ing  software  product that the health plan utilizes and any significant
edits, as determined by the health plan, added to  the  claims  software
product  after the effective date of this section, which are made at the
request of the health plan. The health  plan  shall  also  provide  such
information  upon the written request of a physician OR GENERAL HOSPITAL
who is a participating [physician] PROVIDER in the health plan's provid-
er network.
  (b) Overpayments to physicians AND GENERAL HOSPITALS.  (1) Other  than
recovery for duplicate payments, a health plan shall provide thirty days
written  notice  to  physicians AND GENERAL HOSPITALS before engaging in
additional overpayment recovery efforts seeking recovery of the overpay-
ment of claims to such physicians AND  GENERAL  HOSPITALS.  Such  notice
shall  state  the  patient  name, service date, payment amount, proposed
adjustment, and  a  reasonably  specific  explanation  of  the  proposed
adjustment.
  (2) A health plan shall not initiate overpayment recovery efforts more
than  twenty-four  months  after  the original payment was received by a
physician OR GENERAL HOSPITAL.   Provided, however, that  no  such  time
limit  shall  apply to overpayment recovery efforts which are: (i) based
on a reasonable belief of fraud  or  other  intentional  misconduct,  or
abusive  billing,  (ii)  required  by, or initiated at the request of, a
self-insured plan, or (iii) required by a state  or  federal  government
program.  Notwithstanding  the  aforementioned  time limitations, in the
event that a physician OR GENERAL HOSPITAL asserts that  a  health  plan
has  underpaid  a claim or claims, the health plan may defend or set off
such assertion of underpayment based on overpayments going back in  time
as  far  as  the  claimed  underpayment. For purposes of this paragraph,
"abusive billing" shall be defined as a billing practice  which  results
in  the  submission of claims that are not consistent with sound fiscal,
business, or medical practices and at such  frequency  and  for  such  a
period of time as to reflect a consistent course of conduct.
  (3)  Nothing in this section shall be deemed to limit [an insurer's] A
HEALTH PLAN'S right to pursue recovery  of  overpayments  that  occurred
prior  to  the effective date of this section where the [insurer] HEALTH
PLAN has provided the physician OR GENERAL HOSPITAL with notice of  such
recovery efforts prior to the effective date of this section.
  S  2.  This  act  shall take effect January 1, 2010 and shall apply to
physician and general hospital claims submitted for payment on or  after
such date.