senate Bill S5815A

2013-2014 Legislative Session

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

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Archive: Last Bill Status - In Committee


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

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Actions

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Assembly Actions - Lowercase
Senate Actions - UPPERCASE
Jan 28, 2014 print number 5815a
amend and recommit to corporations, authorities and commissions
Jan 08, 2014 referred to corporations, authorities and commissions
Jun 21, 2013 recommitted to rules
Jun 20, 2013 ordered to third reading cal.1549
Jun 17, 2013 referred to rules

Bill Amendments

Original
A (Active)
Original
A (Active)

S5815 - Bill Details

See Assembly Version of this Bill:
A8034A
Current Committee:
Law Section:
Public Authorities Law
Laws Affected:
Amd §3306, Pub Auth L

S5815 - Bill Texts

view summary

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

view sponsor memo
BILL NUMBER:S5815

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

PURPOSE OR GENERAL IDEA OF BILL: To clarify that Westchester Health
Care Corporation may exercise its general and special powers
regardless of whether such exercise might have an impact on
competition.

SUMMARY OF SPECIFIC PROVISIONS: Section one adds a new subsection 6 to
§ 3306 of the Public Authorities Law to clarify that in carrying out
its health care purposes, the Westchester Health Care Corporation
(WHCC) may engage in arrangements, contracts, information sharing, and
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.

Section two provides the act shall take effect immediately.

JUSTIFICATION: The WHCC, created under the Public Authorities Law,
assumed responsibility for operation of the Westchester County Medical
Center -several facilities previously operated by Westchester County.
WHCC's facilities provide an extensive range of acute care and
ambulatory services to the indigent population in Westchester County
including a significant percentage of the Medicaid discharges. As a
free-standing public healthcare entity, WHCC 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 affirmatively express a policy to displace
competition. Therefore, WHCC 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:14one.

EFFECTIVE DATE:This act shall take effect immediately.

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

                                  5815

                       2013-2014 Regular Sessions

                            I N  S E N A T E

                              June 17, 2013
                               ___________

Introduced  by  Sen.  BALL  --  read twice and ordered printed, and when
  printed to be committed to the Committee on Rules

AN ACT to amend the public authorities law, in relation  to  authorizing
  the  Westchester  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  3306 of the public authorities law is amended by
adding a new subdivision 8 to read as follows:
  8. IN THE EXERCISE OF THE FOREGOING SPECIAL POWERS ESTABLISHED IN THIS
SECTION AND THE GENERAL POWERS SET FORTH IN SECTION THIRTY-FOUR  HUNDRED
FOUR OF THIS ARTICLE, THE CORPORATION IS AUTHORIZED, IN CARRYING OUT ITS
HEALTHCARE  PURPOSES,  TO ENGAGE IN ARRANGEMENTS, CONTRACTS, INFORMATION
SHARING AND ACTIVITIES WITH PUBLIC OR PRIVATE ENTITIES AND  INDIVIDUALS,
INCLUDING  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, IRRESPECTIVE OF THE
COMPETITIVE CONSEQUENCES OF THE FOREGOING COLLABORATIVE ACTIVITIES,  AND
NOTWITHSTANDING  THAT THEY MAY HAVE THE EFFECT OF DISPLACING COMPETITION
IN THE PROVISION OF  HOSPITAL,  PHYSICIAN  OR  OTHER  HEALTHCARE-RELATED
SERVICES,  SUCH  THAT THE CORPORATION AND THE PRIVATE ENTITIES AND INDI-
VIDUALS WITH WHICH IT COLLABORATES SHALL  BE  IMMUNIZED  FROM  LIABILITY
UNDER THE FEDERAL AND STATE ANTITRUST LAWS.
  S 2. This act shall take effect immediately.



 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD11518-01-3

S5815A (ACTIVE) - Bill Details

See Assembly Version of this Bill:
A8034A
Current Committee:
Law Section:
Public Authorities Law
Laws Affected:
Amd §3306, Pub Auth L

S5815A (ACTIVE) - Bill Texts

view summary

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

view sponsor memo
BILL NUMBER:S5815A

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

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

SUMMARY OF PROVISIONS:

Section One - amends Section 3301 of the public authorities law by
adding a new subdivision 6 to state that a free-standing public 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 corpo-
ration'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 find-
ings 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 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 eight of section thirty-three hundred six of
this title, 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.

Section Two - amends Section 3306 of the public authorities law by
adding a new subdivision 8 to state 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-three hundred five 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 competitive 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 with-
out 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 oversight by determining whether particular collab-
orations with public or private entities and individuals further the
interests of the state as set forth in this subdivision and in subdivi-
sion six of section thirty-three hundred one of this title. In undertak-
ing these collaborative activities, 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.
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 addition, the
corporation shall file an annual report with the state department of
health, as additional state oversight, concerning the impact of the
collaborations authorized under this section on the advantages an disad-
vantages 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.

Section Three - provides the act shall take effect immediately.

JUSTIFICATION: The WHCC, created under the Public Authorities Law,
assumed responsibility for operation of the Westchester County Medical
Center -several facilities previously operated by Westchester County.
WHCC's facilities provide an extensive range of acute care and ambulato-
ry services to the indigent population in Westchester County including a
significant percentage of the Medicaid discharges. As a free-standing
public healthcare entity, WHCC faces unique challenges as it seeks to
carry out its mission as a safety-net facility. In particular, its abil-
ity 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 affirmatively
express a policy to displace competition. Therefore, WHCC seeks to clar-
ify 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: This act shall take effect immediately.

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

                                 5815--A

                       2013-2014 Regular Sessions

                            I N  S E N A T E

                              June 17, 2013
                               ___________

Introduced  by  Sen.  BALL  --  read twice and ordered printed, and when
  printed to be committed to the Committee on Rules  --  recommitted  to
  the  Committee on Corporations, Authorities and Commissions in accord-
  ance with Senate Rule 6, sec. 8 -- 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  Westchester  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 3301 of the public authorities law is amended by
adding a new subdivision 6 to read as follows:
  6. 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

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD11518-02-4

S. 5815--A                          2

ACTIVITIES CONSISTENT WITH ITS  HEALTH  CARE  PURPOSES,  NOTWITHSTANDING
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 EIGHT OF  SECTION  THIRTY-THREE  HUNDRED
SIX  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 3306 of the public authorities law is amended by adding a
new subdivision 8 to read as follows:
  8.  (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-THREE HUNDRED FIVE  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 SIX OF SECTION THIRTY-
THREE 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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