NY State Senate Bill 2015-S8148

Senate Bill S8148

2015-2016 Legislative Session

Establishes the "New York's Own combat veterans healthcare choice program act" to establish tax free savings accounts to pay the healthcare costs of certain combat veterans until covered by the federal government

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Archive: Last Bill Status - In Senate Committee Rules Committee

Introduced
- In Committee Assembly
- In Committee Senate
- On Floor Calendar Assembly
- On Floor Calendar Senate
- Passed Assembly
- Passed Senate
Delivered to Governor
Signed By Governor

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Jun 14, 2016	referred to rules

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2015-S8148 (ACTIVE) - Details

Current Committee:: Senate Rules
Law Section:: Military Law
Laws Affected:: Add §216-a, Art 14 §§400 - 405, Mil L; add §81, St Fin L; amd §5205, CPLR; amd §§612 & 658, Tax L
Versions Introduced in 2017-2018 Legislative Session:: S2096

2015-S8148 (ACTIVE) - Summary

Establishes the "New York's Own combat veterans healthcare choice program act" to establish tax free savings accounts to pay the healthcare costs of combat veterans on active duty during Operation Enduring Freedom or Operation Iraqi Freedom, until covered by the federal government.

2015-S8148 (ACTIVE) - Sponsor Memo

                                 BILL NUMBER:  S8148

 TITLE OF BILL :

An act to amend the military law, the state finance law, the civil
practice law and rules and the tax law, in relation to establishing
"New York's Own combat veterans healthcare choice program act"

 PURPOSE :

This bill would authorize the creation of healthcare savings accounts
for New York resident combat veterans of the organized militia of the
State, who while on State Orders in a combat zone during the period
September 2011 to date, suffered injuries or disability, and who, upon
90 days of making application to the US Veterans Administration for
healthcare services related to those injuries or disability, have
still not received primary care or an appointment for primary care,
for those injuries or disability.

 SUMMARY OF PROVISIONS :

The health care savings accounts will be funded: 1) for a period of up
to three years by New York State in the amount of $5,000 per year;
and, 2) by State tax deductible contributions from the combat veteran
not to exceed $5,000 per year. The State's contributions to the
soldier's health care savings accounts will terminate upon the earlier

of: a) the combat veteran securing services from the VA for the
injuries or disability sustained in a combat zone; or, b) three years
after establishment of the account.

All "Qualified Expenditures" from the account for healthcare would
likewise be New York State tax deductible and would specifically
include drug and alcohol rehabilitation as well as PTSD. The combat
veteran has complete authority to choose the healthcare provider so
long as they are licensed by New York State. Much like the College
Savers program, the accounts would be administered by the State
Comptroller and unexpended funds would earn interest while on account

 JUSTIFICATION :

The healthcare savings account program is patterned on the very
successful "New York 529 College Savers" program and will provide New
York resident members of the organized militia who deployed with a New
York unit to a combat zone, a bridge to much needed healthcare when,
through no fault of the service member, they have been unable to
secure primary care, or an appointment with a US Veterans
Administration primary care physician on a timely basis.

The recently released report of the General Accounting Office noted
that the Veterans Choice Program created by Congress in 2014 has
failed to reduce the number of veterans waiting more than 30 days to
get an appointment for primary care at either a VA facility or with
one of the Veterans Choice providers as the law requires. In fact,
according to the GAO report there are 71,000 more veterans waiting
more than the 30 days than there was in May of 2015.  Among the
hundreds of thousands of veterans waiting longer than 30 days are
hundreds of New York resident Air and Army National Guard combat
veterans who sustained injuries or disabilities in a combat zone on
orders from The Governor and Adjutant General; and who, despite
efforts to secure primary care from the US Veterans Administration,
have been unable to schedule appointments. This program will ensure
they have healthcare until picked up by the Veterans Administration.

The Governor and Adjutant General have issued over 14,300 Orders to
members of the Organized Militia of New York to serve in certified
combat zones since September 11, 2001. An undetermined number of these
orders were issued to service members who had previously deployed to a
combat zone.

While the Division of Military and Naval Affairs does not certify
disability ratings nor does it have any mechanism for tracking the
applications of personnel returning from a combat zone who have made
application to US Veterans Administration for healthcare services,
this bill would create a mechanism for New York State to take of its
own combat veterans for injuries or disability suffered while on State
Orders in a Combat Zone if the US Veterans Administration has failed
to provide the service member with an appointment with a primary care
physician within 90 days of requesting one.

 LEGISLATIVE HISTORY :

New bill

 FISCAL IMPLICATIONS :

It is not possible to determine the total annual cost of this bill
since the number of effected New York resident combat veterans who
would qualify cannot be estimated. However, the total number of combat
deployments is 14,353 and among this universe is a number service
members with multiple deployments and still others who are not
residents of New York State. Available records indicate that the
percentage of all civilian veterans with a VA disability is just 16.6%
and the number of combat veterans applying for VA disability has
ranged from 8 % for Operation Enduring Freedom to a high of 30 % for
Operation Iraqi Freedom. Since it is likely that a number of New
York's combat injured or disabled soldiers and airmen have succeeded
in securing appointments with a VA primary care physicians, the number
qualified applicants is projected to be not more than 1,500.

Thus, the maximum fiscal impact would not exceed $7,500,000 per year
over the first three years. Since the benefit terminates after the
earlier of three years; or the VA's assumption of responsibility for
primary care, it is highly unlikely that fiscal impact will ever reach
this sum.

 EFFECTIVE DATE :
This act shall take effect immediately and shall apply to taxable
years beginning after December 31, 2016.

2015-S8148 (ACTIVE) - Bill Text download pdf

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

                                  8148

                            I N  S E N A T E

                              June 14, 2016
                               ___________

Introduced  by  Sens.  MURPHY,  CROCI,  LARKIN -- read twice and ordered
  printed, and when printed to be committed to the Committee on Rules

AN ACT to amend the military law, the state finance law, the civil prac-
  tice law and rules and the tax law, in relation to  establishing  "New
  York's Own combat veterans healthcare choice program act"

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

  Section 1. Short title. This act shall be known and may  be  cited  as
the "New York's Own combat veterans healthcare choice program act".
  S 2. The military law is amended by adding a new section 216-a to read
as follows:
  S 216-A. MEDICAL CARE WHEN INJURED OR DISABLED IN COMBAT ZONE.  1. ANY
NEW  YORK  RESIDENT  MEMBER  OF THE ORGANIZED MILITIA WHO SHALL, WHEN ON
ACTIVE DUTY IN A COMBAT ZONE, DESIGNATED BY THE PRESIDENT OF THE  UNITED
STATES DURING OPERATION ENDURING FREEDOM OR OPERATION IRAQI FREEDOM, FOR
THREE  HUNDRED  SIXTY DAYS OR MORE ON ORDERS ISSUED BY THE GOVERNOR, THE
COMMANDING GENERAL OF THE NEW YORK ARMY NATIONAL GUARD,  THE  COMMANDING
OFFICER  OF THE NEW YORK AIR NATIONAL GUARD OR THE COMMANDING OFFICER OF
THE NAVAL MILITIA, RECEIVE ANY WOUND OR INJURY, OR INCUR OR CONTRACT ANY
DISABILITY OR DISEASE, BY REASON OF SUCH  DUTY,  OR  WHO  SHALL  WITHOUT
FAULT  OR  NEGLECT  ON  HIS  OR  HER  PART  BE WOUNDED OR DISABLED WHILE
PERFORMING ANY LAWFULLY ORDERED DUTY WHILE IN SUCH A COMBAT ZONE,  WHICH
SHALL  INCAPACITATE  HIM  OR HER, AND WHO IS UNABLE TO RECEIVE TIMELY OR
ADEQUATE HEALTHCARE SERVICES FROM THE  FEDERAL  DEPARTMENT  OF  VETERANS
AFFAIRS WITHIN NINETY DAYS OF MAKING APPLICATION FOR SUCH SERVICES SHALL
RECEIVE  THE PAYMENT INTO SUCH SERVICE MEMBER'S NEW YORK COMBAT VETERANS
HEALTHCARE CHOICE ACCOUNT ESTABLISHED PURSUANT TO  ARTICLE  FOURTEEN  OF
THIS  CHAPTER  FOR  CARE  AND MEDICAL TREATMENT IF AUTHORITY THEREFOR IS
GRANTED BY THE ADJUTANT GENERAL, EXPENSES FOR SUCH    CARE  AND  MEDICAL
ATTENDANCE  AS ARE NECESSARY FOR THE APPROPRIATE TREATMENT OF THE WOUND,
INJURY, DISEASE OR DISABILITY MAY BE  PAID  FROM  THE  NEW  YORK  COMBAT
VETERANS  HEALTHCARE  CHOICE  ACCOUNT AS PROVIDED IN ARTICLE FOURTEEN OF
THIS CHAPTER UNTIL TREATMENT IS PROVIDED BY THE FEDERAL VETERANS  ADMIN-
ISTRATION,  OR THE INCAPACITY RESULTING FROM SUCH WOUND, INJURY, DISEASE

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

                                                           LBD15728-03-6

S. 8148                             2

OR DISABILITY CANNOT BE MATERIALLY IMPROVED BY FURTHER  CARE  OR  TREAT-
MENT.  THE  DETERMINATION OF WHETHER SUCH INJURY OR DISEASE WAS INCURRED
WHILE PERFORMING SUCH LAWFULLY ORDERED ACTIVE DUTY  IN  A  COMBAT  ZONE,
DESIGNATED BY THE PRESIDENT OF THE UNITED STATES DURING OPERATION ENDUR-
ING FREEDOM OR OPERATION IRAQI FREEDOM, SHALL BE IN ACCORDANCE WITH THIS
SECTION AND SUCH REGULATIONS AS MAY BE PRESCRIBED BY THE ADJUTANT GENER-
AL.
  2.  IF  CARE  FOR  SUCH  A  SERVICE MEMBER IS APPROVED BY THE ADJUTANT
GENERAL AND THE SERVICE MEMBER SHALL HAVE  CREATED  A  NEW  YORK  COMBAT
VETERANS  HEALTHCARE  CHOICE ACCOUNT IN ACCORDANCE WITH ARTICLE FOURTEEN
OF THIS CHAPTER, THE STATE SHALL MAKE A PAYMENT OF FIVE THOUSAND DOLLARS
INTO SUCH SERVICE MEMBER'S COMBAT VETERANS  HEALTHCARE  CHOICE  ACCOUNT.
SUCH PAYMENT SHALL NOT EXCEED FIVE THOUSAND DOLLARS IN ANY CALENDAR YEAR
AND  SHALL  BE  DISCONTINUED UPON THE SERVICE MEMBER RECEIVING CARE FROM
THE FEDERAL DEPARTMENT OF VETERANS AFFAIRS FOR THE INJURIES OR DISABILI-
TIES SUSTAINED WHILE IN QUALIFIED STATE SERVICE.
  3. NONE OF THE BENEFITS PROVIDED BY SUBDIVISION ONE  OF  THIS  SECTION
SHALL  BE  PAID OR ALLOWED UNLESS A CLAIM THEREFOR HAS BEEN PRESENTED TO
THE ADJUTANT GENERAL WITHIN THREE YEARS AFTER THE DATE WHEN SUCH  WOUND,
INJURY,  DISEASE  OR  DISABILITY WAS INCURRED OR CONTRACTED. NONE OF THE
BENEFITS PROVIDED BY SUBDIVISION ONE OF THIS SECTION SHALL  BE  PAID  OR
ALLOWED  BY  THE  STATE  FOR  ANY PERIOD DURING WHICH SUCH MEMBER OF THE
ORGANIZED MILITIA IS ENTITLED TO RECEIVE THE SAME AS  A  CHARGE  AGAINST
FEDERAL FUNDS.
  4.  A.  WHERE  A CLAIM IS MADE UNDER THIS SECTION THE ADJUTANT GENERAL
WILL MAKE A DETERMINATION AS TO WHETHER VALID APPLICATION OR ATTEMPT  TO
SCHEDULE  AN APPOINTMENT TO FILE AN APPLICATION FOR CARE WAS MADE TO THE
FEDERAL VETERANS ADMINISTRATION  AND  WHETHER  NINETY  DAYS  SHALL  HAVE
PASSED  SINCE SUCH APPLICATION OR ATTEMPT WAS MADE. THE ADJUTANT GENERAL
MAY CAUSE EXAMINATIONS OF THE CLAIMANT TO BE MADE FROM TIME TO TIME BY A
PHYSICIAN, SURGEON OR DENTIST DESIGNATED FOR THE PURPOSE BY THE ADJUTANT
GENERAL, AND HE OR SHE MAY DIRECT THE REMOVAL OF A CLAIMANT TO, AND  HIS
OR  HER TREATMENT IN, A HOSPITAL DESIGNATED BY THE ADJUTANT GENERAL, AND
IF THE CLAIMANT REFUSES TO PERMIT ANY SUCH EXAMINATION OR IF HE  OR  SHE
REFUSES  TO  GO TO SUCH HOSPITAL OR TO FOLLOW THE ADVICE GIVEN OR TREAT-
MENT PRESCRIBED FOR HIM OR HER THEREIN, HE OR SHE SHALL THEREBY  FORFEIT
AND  BE  BARRED  FROM  ALL  RIGHT  TO  ANY CLAIM OR ALLOWANCE UNDER THIS
SECTION.
  B. THE ADJUTANT GENERAL MAY APPOINT A MEDICAL EXAMINER OR A  BOARD  OF
THREE  OFFICERS,  AT  LEAST  ONE  OF WHOM SHALL BE A MEDICAL OFFICER, TO
INQUIRE INTO THE MERITS OF ANY CLAIM PRESENTED UNDER THIS  SECTION,  AND
TO  RECOMMEND THE AMOUNT OR AMOUNTS, IF ANY, TO BE PAID OR ALLOWED UNDER
THIS SECTION, OR HE OR SHE MAY, IN HIS OR HER DISCRETION, DETERMINE  ANY
CLAIM  WITHOUT APPOINTING A MEDICAL EXAMINER OR BOARD AND FIX THE AMOUNT
TO BE PAID OR ALLOWED UNDER THIS  SECTION.  IF  NO  MEDICAL  OFFICER  IS
AVAILABLE, SUCH MEDICAL EXAMINER OR MEDICAL OFFICER ON SUCH BOARD MAY BE
A CIVILIAN PHYSICIAN, SURGEON OR DENTIST.
  C. A MEDICAL EXAMINER OR BOARD APPOINTED UNDER THIS SECTION SHALL HAVE
THE  SAME  POWER TO TAKE EVIDENCE, ADMINISTER OATHS, ISSUE SUBPOENAS AND
COMPEL WITNESSES TO ATTEND AND TESTIFY AND TO PRODUCE BOOKS AND  PAPERS,
AND TO PUNISH THEIR FAILURE TO DO SO AS IS POSSESSED BY MILITARY COURTS.
  D.  THE  FINDINGS AND RECOMMENDATIONS OF THE MEDICAL EXAMINER OR BOARD
SHALL  BE  SUBMITTED  TO  THE  ADJUTANT  GENERAL  WHO  MAY  RETURN   THE
PROCEEDINGS  TO SUCH EXAMINER OR BOARD FOR RECONSIDERATION OR FOR TAKING
FURTHER TESTIMONY AND WHO SHALL APPROVE OR DISAPPROVE THE CLAIM AND  FIX
THE AMOUNT, IF ANY, TO BE PAID OR ALLOWED UNDER THIS SECTION. THE AMOUNT

S. 8148                             3

SO  FIXED  BY THE ADJUTANT GENERAL SHALL BE A CHARGE AGAINST AND BE PAID
IN THE MANNER PROVIDED BY THIS SECTION, BY THE STATE.
  S 3. The military law is amended by adding a new article 14 to read as
follows:
                               ARTICLE 14
        NEW YORK'S OWN COMBAT VETERANS HEALTHCARE CHOICE PROGRAM
SECTION 400. PROGRAM ESTABLISHED.
        401. PURPOSE.
        402. DEFINITIONS.
        403. FUNCTIONS OF THE COMPTROLLER AND THE DIVISION.
        404. PROGRAM  REQUIREMENTS;  NEW YORK COMBAT VETERANS HEALTHCARE
               CHOICE ACCOUNT.
        405. PROGRAM LIMITATIONS; NEW YORK  COMBAT  VETERANS  HEALTHCARE
               CHOICE ACCOUNT.
  S  400. PROGRAM ESTABLISHED.  THERE IS HEREBY ESTABLISHED THE NEW YORK
COMBAT VETERANS HEALTHCARE CHOICE PROGRAM  AND  SUCH  PROGRAM  SHALL  BE
KNOWN AND MAY BE CITED AS THE "NEW YORK'S OWN COMBAT VETERANS HEALTHCARE
CHOICE PROGRAM".
  S  401.  PURPOSE. THE PURPOSES OF THE NEW YORK COMBAT VETERANS HEALTH-
CARE CHOICE PROGRAM ARE  TO  AUTHORIZE  THE  ESTABLISHMENT  OF  VETERANS
HEALTHCARE CHOICE ACCOUNTS AND PROVIDE GUIDELINES FOR THE MAINTENANCE OF
SUCH ACCOUNTS TO:
  1.  ENABLE  RESIDENT  VETERAN MEMBERS OF THE ORGANIZED MILITIA OF THIS
STATE WHO WERE ON ACTIVE DUTY IN A COMBAT ZONE, DESIGNATED BY THE PRESI-
DENT OF THE UNITED STATES DURING OPERATION ENDURING FREEDOM OR OPERATION
IRAQI FREEDOM, TO OBTAIN HEALTHCARE FROM THE PROVIDER OF  THEIR  CHOICE,
WITH  FUNDS  FROM  A  NEW YORK COMBAT VETERANS HEALTHCARE CHOICE ACCOUNT
FUNDED BY THE STATE AND THE SERVICE MEMBER IN ACCORDANCE WITH THIS ARTI-
CLE, WHEN AFTER NINETY DAYS OF MAKING APPLICATION TO  OR  ATTEMPTING  TO
SCHEDULE  AN  APPOINTMENT  WITH  THE FEDERAL VETERANS ADMINISTRATION FOR
SUCH CARE, THE SERVICE MEMBER IS UNABLE TO  SECURE  TIMELY  OR  ADEQUATE
HEALTHCARE  SERVICES FOR INJURIES AND DISABILITIES SUSTAINED IN THE LINE
OF ACTIVE DUTY IN SUCH A COMBAT ZONE, WHENEVER ORDERED INTO SUCH  COMBAT
ZONE  FOR THREE HUNDRED SIXTY DAYS OR MORE BY THE GOVERNOR, THE COMMAND-
ING GENERAL OF THE NEW YORK ARMY NATIONAL GUARD, THE COMMANDING  OFFICER
OF  THE  NEW  YORK  AIR  NATIONAL GUARD OR THE COMMANDING OFFICER OF THE
NAVAL MILITIA;
  2. PROVIDE FUNDING FROM THE STATE FOR NEW YORK COMBAT VETERANS HEALTH-
CARE CHOICE ACCOUNTS IN AN AMOUNT OF UP TO  FIVE  THOUSAND  DOLLARS  PER
CALENDAR YEAR FOR A PERIOD NOT TO EXCEED THREE YEARS, WHEN IN ACCORDANCE
WITH  THIS  ARTICLE, A QUALIFIED STATE RESIDENT COMBAT VETERAN IS UNABLE
TO SECURE HEALTHCARE SERVICES WITHIN NINETY DAYS OF  MAKING  APPLICATION
OR  SCHEDULING  AN  APPOINTMENT  TO  MAKE  SUCH  AN APPLICATION FOR SUCH
SERVICES FROM THE FEDERAL VETERANS ADMINISTRATION; AND
  3. TO CREATE  A  STATE  PERSONAL  INCOME  TAX  DEDUCTION  FOR  AMOUNTS
CONTRIBUTED  BY  QUALIFIED RESIDENT COMBAT VETERANS TO A NEW YORK COMBAT
VETERANS HEALTHCARE CHOICE ACCOUNT IN AN AMOUNT NOT TO EXCEED FIVE THOU-
SAND DOLLARS PER CALENDAR YEAR AS PROVIDED IN THIS ARTICLE.
  S 402. DEFINITIONS. AS USED IN THIS ARTICLE, THE FOLLOWING TERMS SHALL
HAVE THE FOLLOWING MEANINGS:
  1. "ACCOUNT" OR "NEW YORK COMBAT VETERANS HEALTHCARE  CHOICE  ACCOUNT"
SHALL  MEAN AN INDIVIDUAL SAVINGS ACCOUNT ESTABLISHED IN ACCORDANCE WITH
THE PROVISIONS OF THIS ARTICLE.
  2. "ACCOUNT OWNER" SHALL MEAN A PERSON WHO  ENTERS  INTO  A  NEW  YORK
COMBAT  VETERANS  HEALTHCARE  CHOICE  ACCOUNT  AGREEMENT PURSUANT TO THE
PROVISIONS OF THIS ARTICLE, INCLUDING A PERSON WHO ENTERS INTO  SUCH  AN

S. 8148                             4

AGREEMENT AS A FIDUCIARY OR AGENT ON BEHALF OF A TRUST, ESTATE, PARTNER-
SHIP, ASSOCIATION, COMPANY OR CORPORATION. THE ACCOUNT OWNER MAY ALSO BE
THE DESIGNATED BENEFICIARY OF THE ACCOUNT.
  3.  "DESIGNATED BENEFICIARY" SHALL MEAN, WITH RESPECT TO AN ACCOUNT OR
ACCOUNTS, THE INDIVIDUAL DESIGNATED AS THE INDIVIDUAL  WHOSE  HEALTHCARE
EXPENSES ARE EXPECTED TO BE PAID FROM THE ACCOUNT OR ACCOUNTS.
  4.  "FINANCIAL  ORGANIZATION" SHALL MEAN AN ORGANIZATION AUTHORIZED TO
DO BUSINESS IN THE STATE OF NEW YORK AND (A) IS AN AUTHORIZED  FIDUCIARY
TO  ACT  AS  A  TRUSTEE PURSUANT TO THE PROVISIONS OF AN ACT OF CONGRESS
ENTITLED "EMPLOYEE RETIREMENT INCOME  SECURITY  ACT  OF  1974"  AS  SUCH
PROVISIONS  MAY  BE  AMENDED FROM TIME TO TIME, OR AN INSURANCE COMPANY;
AND (B)(I) IS LICENSED OR  CHARTERED  BY  THE  DEPARTMENT  OF  FINANCIAL
SERVICES,  (II)  IS  CHARTERED  BY  AN AGENCY OF THE FEDERAL GOVERNMENT,
(III) IS SUBJECT TO THE JURISDICTION AND REGULATION  OF  THE  SECURITIES
AND  EXCHANGE COMMISSION OF THE FEDERAL GOVERNMENT, OR (IV) IS ANY OTHER
ENTITY OTHERWISE AUTHORIZED TO ACT IN THIS  STATE  AS  A  TRUSTEE  OF  A
HEALTH  SAVINGS ACCOUNT PURSUANT TO THE PROVISIONS OF AN ACT OF CONGRESS
ENTITLED THE "MEDICARE PRESCRIPTION DRUG, IMPROVEMENT, AND MODERNIZATION
ACT", AS SUCH PROVISIONS MAY BE AMENDED FROM TIME TO TIME.
  5.  "ELIGIBLE  HEALTHCARE  INSTITUTION"  SHALL  MEAN  ANY  INSTITUTION
LICENSED,  CERTIFIED  OR  AUTHORIZED  BY THE STATE TO PROVIDE HEALTHCARE
SERVICES.
  6. "MEMBER OF FAMILY" SHALL MEAN A FAMILY MEMBER AS DEFINED IN SECTION
529 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED.
  7. "PROGRAM" SHALL MEAN THE NEW YORK COMBAT VETERANS HEALTHCARE CHOICE
ACCOUNT PROGRAM ESTABLISHED PURSUANT TO THIS ARTICLE.
  8. "QUALIFIED HEALTHCARE EXPENSES"  SHALL  MEAN  ANY  MEDICAL  EXPENSE
DEDUCTIBLE ON FEDERAL INCOME TAXES.
  9.  "QUALIFIED  STATE SERVICE" SHALL MEAN ACTIVE DUTY SERVICE RENDERED
WHILE BEING ORDERED INTO A COMBAT ZONE, DESIGNATED BY THE  PRESIDENT  OF
THE  UNITED  STATES DURING OPERATION ENDURING FREEDOM OR OPERATION IRAQI
FREEDOM, FOR THREE HUNDRED SIXTY DAYS  OR  MORE  BY  THE  GOVERNOR,  THE
COMMANDING  GENERAL  OF THE NEW YORK ARMY NATIONAL GUARD, THE COMMANDING
OFFICER OF THE NEW YORK AIR NATIONAL GUARD OR THE COMMANDING OFFICER  OF
THE NAVAL MILITIA.
  10.  "QUALIFIED WITHDRAWAL" SHALL MEAN A WITHDRAWAL FROM AN ACCOUNT TO
PAY THE QUALIFIED HEALTHCARE EXPENSES OF A SERVICE MEMBER OR  DESIGNATED
BENEFICIARY OF AN ACCOUNT AT AN ELIGIBLE HEALTHCARE INSTITUTION.
  11.  "NONQUALIFIED WITHDRAWAL" SHALL MEAN A WITHDRAWAL FROM AN ACCOUNT
WHICH IS NOT:
  A. A QUALIFIED WITHDRAWAL; OR
  B. A WITHDRAWAL MADE AS THE RESULT OF THE DEATH OR DISABILITY  OF  THE
DESIGNATED BENEFICIARY OF THE ACCOUNT.
  12. "DIVISION" SHALL MEAN THE DIVISION OF MILITARY AND NAVAL AFFAIRS.
  13. "COMPTROLLER" SHALL MEAN THE STATE COMPTROLLER.
  14.  "MANAGEMENT  CONTRACT"  SHALL  MEAN  THE CONTRACT EXECUTED BY THE
COMPTROLLER AND A FINANCIAL ORGANIZATION SELECTED TO ACT AS A DEPOSITORY
AND MANAGER OF THE PROGRAM.
  15. "NEW YORK COMBAT VETERANS  HEALTHCARE  CHOICE  ACCOUNT  AGREEMENT"
SHALL MEAN AN AGREEMENT BETWEEN THE COMPTROLLER OR A FINANCIAL ORGANIZA-
TION AND AN ACCOUNT OWNER.
  16.  "PROGRAM MANAGER" SHALL MEAN A FINANCIAL ORGANIZATION SELECTED BY
THE COMPTROLLER TO ACT AS DEPOSITORY AND MANAGER OF THE PROGRAM.
  S 403. FUNCTIONS OF THE COMPTROLLER AND THE  DIVISION.  1.  THE  COMP-
TROLLER AND THE DIVISION SHALL IMPLEMENT THE PROGRAM UNDER THE TERMS AND
CONDITIONS ESTABLISHED BY THIS ARTICLE AND A MEMORANDUM OF UNDERSTANDING

S. 8148                             5

RELATING TO ANY TERMS OR CONDITIONS NOT OTHERWISE EXPRESSLY PROVIDED FOR
IN THIS ARTICLE.
  2. IN FURTHERANCE OF SUCH IMPLEMENTATION THE MEMORANDUM OF UNDERSTAND-
ING  SHALL  ADDRESS  THE AUTHORITY AND RESPONSIBILITY OF THE COMPTROLLER
AND THE DIVISION TO:
  A. DEVELOP AND IMPLEMENT THE PROGRAM IN A MANNER CONSISTENT  WITH  THE
PROVISIONS  OF THIS ARTICLE THROUGH RULES AND REGULATIONS ESTABLISHED IN
ACCORDANCE WITH THE STATE ADMINISTRATIVE PROCEDURE ACT;
  B. ENGAGE THE SERVICES OF CONSULTANTS ON A CONTRACT BASIS FOR  RENDER-
ING PROFESSIONAL AND TECHNICAL ASSISTANCE AND ADVICE;
  C.  SEEK  RULINGS AND OTHER GUIDANCE FROM THE UNITED STATES DEPARTMENT
OF TREASURY AND THE INTERNAL REVENUE SERVICE RELATING TO THE PROGRAM;
  D. MAKE CHANGES TO THE PROGRAM REQUIRED FOR THE  PARTICIPANTS  IN  THE
PROGRAM  TO OBTAIN THE FEDERAL INCOME TAX BENEFITS OR TREATMENT PROVIDED
FOR HEALTH SAVINGS ACCOUNTS;
  E. CHARGE, IMPOSE AND COLLECT ADMINISTRATIVE FEES AND SERVICE  CHARGES
IN  CONNECTION  WITH  ANY AGREEMENT, CONTRACT OR TRANSACTION RELATING TO
THE PROGRAM;
  F. DEVELOP MARKETING PLANS AND PROMOTION MATERIAL;
  G. ESTABLISH THE METHODS BY WHICH THE FUNDS HELD IN SUCH  ACCOUNTS  BE
DISPERSED;
  H.  ESTABLISH  THE METHOD BY WHICH FUNDS SHALL BE ALLOCATED TO PAY FOR
ADMINISTRATIVE COSTS; AND
  I. DO ALL THINGS NECESSARY AND PROPER TO CARRY  OUT  THE  PURPOSES  OF
THIS ARTICLE.
  S  404.  PROGRAM  REQUIREMENTS;  NEW  YORK  COMBAT VETERANS HEALTHCARE
CHOICE ACCOUNT. 1. NEW YORK COMBAT VETERANS HEALTHCARE  CHOICE  ACCOUNTS
ESTABLISHED PURSUANT TO THE PROVISIONS OF THIS ARTICLE SHALL BE GOVERNED
BY THE PROVISIONS OF THIS SECTION.
  2.  A NEW YORK COMBAT VETERANS HEALTHCARE CHOICE ACCOUNT MAY BE OPENED
BY ANY PERSON WHO DESIRES TO SAVE MONEY FOR THE PAYMENT OF THE QUALIFIED
HEALTHCARE EXPENSES OF THE DESIGNATED BENEFICIARY. AN ACCOUNT OWNER  MAY
DESIGNATE  ANOTHER  QUALIFIED  SERVICE  MEMBER AS SUCCESSOR OWNER OF THE
ACCOUNT IN THE EVENT OF THE DEATH OF THE ORIGINAL  ACCOUNT  OWNER.  SUCH
PERSON  WHO  OPENS AN ACCOUNT OR ANY SUCCESSOR OWNER SHALL BE CONSIDERED
THE ACCOUNT OWNER.
  A. AN APPLICATION FOR SUCH ACCOUNT SHALL BE IN THE FORM PRESCRIBED  BY
THE PROGRAM AND CONTAIN THE FOLLOWING:
  (I) THE NAME, ADDRESS AND SOCIAL SECURITY NUMBER OR EMPLOYER IDENTIFI-
CATION NUMBER OF THE ACCOUNT OWNER;
  (II) THE DESIGNATION OF A DESIGNATED BENEFICIARY;
  (III)  THE NAME, ADDRESS, AND SOCIAL SECURITY NUMBER OF THE DESIGNATED
BENEFICIARY; AND
  (IV) SUCH OTHER INFORMATION AS THE PROGRAM MAY REQUIRE.
  B. THE COMPTROLLER AND THE DIVISION MAY ESTABLISH A  NOMINAL  FEE  FOR
SUCH APPLICATION.
  3.  ANY PERSON, INCLUDING THE ACCOUNT OWNER, MAY MAKE CONTRIBUTIONS TO
THE ACCOUNT AFTER THE ACCOUNT IS OPENED.
  4. CONTRIBUTIONS TO ACCOUNTS MAY BE MADE ONLY IN CASH.
  5. AN ACCOUNT OWNER MAY MAKE A QUALIFIED WITHDRAWAL OF ALL OR PART  OF
THE  BALANCE FROM AN ACCOUNT ON SIXTY DAYS NOTICE OR SUCH SHORTER PERIOD
AS MAY BE AUTHORIZED UNDER RULES GOVERNING THE PROGRAM. SUCH RULES SHALL
INCLUDE PROVISIONS THAT WILL GENERALLY ENABLE THE  DETERMINATION  AS  TO
WHETHER  A  WITHDRAWAL IS A NONQUALIFIED WITHDRAWAL OR A QUALIFIED WITH-
DRAWAL.

S. 8148                             6

  6. AN ACCOUNT OWNER  MAY  CHANGE  THE  DESIGNATED  BENEFICIARY  OF  AN
ACCOUNT  TO  A SERVICE MEMBER WHO IS A MEMBER OF THE FAMILY OF THE PRIOR
DESIGNATED BENEFICIARY IN ACCORDANCE WITH PROCEDURES ESTABLISHED BY  THE
MEMORANDUM  OF  UNDERSTANDING PURSUANT TO THE PROVISIONS OF SECTION FOUR
HUNDRED THREE OF THIS ARTICLE.
  7.  THE  PROGRAM SHALL PROVIDE SEPARATE ACCOUNTING FOR EACH DESIGNATED
BENEFICIARY.
  8. NO ACCOUNT OWNER OR DESIGNATED BENEFICIARY OF ANY ACCOUNT SHALL  BE
PERMITTED TO DIRECT THE INVESTMENT OF ANY CONTRIBUTIONS TO AN ACCOUNT OR
THE EARNINGS THEREON MORE THAN TWO TIMES IN ANY CALENDAR YEAR.
  9.  NEITHER  AN  ACCOUNT OWNER NOR A DESIGNATED BENEFICIARY MAY USE AN
INTEREST IN AN ACCOUNT AS SECURITY FOR A LOAN. ANY PLEDGE OF AN INTEREST
IN AN ACCOUNT SHALL BE OF NO FORCE AND EFFECT.
  10. THE COMPTROLLER SHALL PROMULGATE RULES OR REGULATIONS  TO  PREVENT
CONTRIBUTIONS  ON  BEHALF  OF  A  DESIGNATED BENEFICIARY IN EXCESS OF AN
AMOUNT THAT WOULD CAUSE THE AGGREGATE ACCOUNT BALANCE FOR  ALL  ACCOUNTS
FOR  A  DESIGNATED  BENEFICIARY  TO EXCEED A MAXIMUM ACCOUNT BALANCE, AS
ESTABLISHED FROM TIME TO TIME BY THE COMPTROLLER AND THE DIVISION ON THE
BASIS OF HEALTHCARE COSTS IN THE  STATE,  WITH  ADEQUATE  SAFEGUARDS  TO
PREVENT  MORE  CONTRIBUTIONS THAN NECESSARY TO PROVIDE FOR THE QUALIFIED
HEALTHCARE COSTS OF THE BENEFICIARY, AS REQUIRED TO MAINTAIN THE PROGRAM
AS A "QUALIFIED HEALTH SAVINGS PROGRAM" PURSUANT TO FEDERAL LAW.
  11. A. IF THERE IS ANY DISTRIBUTION FROM AN ACCOUNT TO ANY  INDIVIDUAL
OR  FOR  THE  BENEFIT  OF  ANY  INDIVIDUAL  DURING A CALENDAR YEAR, SUCH
DISTRIBUTION SHALL BE REPORTED TO THE INTERNAL REVENUE SERVICE  AND  THE
ACCOUNT  OWNER,  THE  DESIGNATED  BENEFICIARY, OR THE DISTRIBUTEE TO THE
EXTENT REQUIRED BY FEDERAL LAW OR REGULATION.
  B. STATEMENTS SHALL BE PROVIDED TO EACH ACCOUNT OWNER  AT  LEAST  ONCE
EACH  YEAR WITHIN SIXTY DAYS AFTER THE END OF THE TWELVE MONTH PERIOD TO
WHICH THEY RELATE. THE STATEMENT SHALL IDENTIFY THE  CONTRIBUTIONS  MADE
DURING  A PRECEDING TWELVE MONTH PERIOD, THE TOTAL CONTRIBUTIONS MADE TO
THE ACCOUNT THROUGH THE END OF THE PERIOD, THE VALUE OF THE  ACCOUNT  AT
THE  END  OF  SUCH PERIOD, DISTRIBUTIONS MADE DURING SUCH PERIOD AND ANY
OTHER INFORMATION THAT THE COMPTROLLER SHALL REQUIRE TO BE  REPORTED  TO
THE ACCOUNT OWNER.
  C.  STATEMENTS  AND INFORMATION RELATING TO ACCOUNTS SHALL BE PREPARED
AND FILED TO THE EXTENT REQUIRED BY FEDERAL AND STATE TAX LAW.
  12. A.  A  LOCAL  GOVERNMENT  OR  ORGANIZATION  DESCRIBED  IN  SECTION
501(C)(3) OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED, MAY OPEN AND
BECOME  THE  ACCOUNT  OWNER  OF  AN ACCOUNT TO FUND QUALIFIED HEALTHCARE
EXPENSES FOR PERSONS WHOSE IDENTITY WILL BE  DETERMINED  UPON  DISBURSE-
MENT.
  B.  IN  THE CASE OF ANY ACCOUNT OPENED PURSUANT TO PARAGRAPH A OF THIS
SUBDIVISION THE REQUIREMENT SET FORTH IN SUBDIVISION TWO OF THIS SECTION
THAT A DESIGNATED BENEFICIARY BE DESIGNATED WHEN AN  ACCOUNT  IS  OPENED
SHALL  NOT  APPLY  AND  EACH INDIVIDUAL WHO RECEIVES AN INTEREST IN SUCH
ACCOUNT AS A QUALIFIED HEALTHCARE EXPENSE GRANT SHALL BE  TREATED  AS  A
DESIGNATED BENEFICIARY WITH RESPECT TO SUCH INTEREST.
  13.  AN ANNUAL FEE MAY BE IMPOSED UPON THE ACCOUNT OWNER FOR THE MAIN-
TENANCE OF THE ACCOUNT.
  14. THE PROGRAM SHALL DISCLOSE THE FOLLOWING INFORMATION IN WRITING TO
EACH ACCOUNT OWNER AND PROSPECTIVE ACCOUNT OWNER OF A  NEW  YORK  COMBAT
VETERANS HEALTHCARE CHOICE ACCOUNT:
  A.  THE TERMS AND CONDITIONS FOR PURCHASING A NEW YORK COMBAT VETERANS
HEALTHCARE CHOICE ACCOUNT;
  B. ANY RESTRICTIONS ON THE SUBSTITUTION OF BENEFICIARIES;

S. 8148                             7

  C. THE PERSON OR ENTITY ENTITLED TO  TERMINATE  THE  NEW  YORK  COMBAT
VETERANS HEALTHCARE CHOICE ACCOUNT AGREEMENT;
  D.  THE PERIOD OF TIME DURING WHICH A BENEFICIARY MAY RECEIVE BENEFITS
UNDER THE NEW YORK COMBAT VETERANS HEALTHCARE CHOICE ACCOUNT AGREEMENT;
  E. THE TERMS AND  CONDITIONS  UNDER  WHICH  MONEY  MAY  BE  WHOLLY  OR
PARTIALLY WITHDRAWN FROM THE PROGRAM, INCLUDING, BUT NOT LIMITED TO, ANY
REASONABLE CHARGES AND FEES THAT MAY BE IMPOSED FOR WITHDRAWAL;
  F.  THE PROBABLE TAX CONSEQUENCES ASSOCIATED WITH CONTRIBUTIONS TO AND
DISTRIBUTIONS FROM ACCOUNTS; AND
  G. ALL OTHER RIGHTS AND OBLIGATIONS PURSUANT TO NEW YORK COMBAT VETER-
ANS HEALTHCARE CHOICE ACCOUNT AGREEMENTS, AND ANY  OTHER  TERMS,  CONDI-
TIONS,  AND  PROVISIONS DEEMED NECESSARY AND APPROPRIATE BY THE TERMS OF
THE MEMORANDUM OF UNDERSTANDING ENTERED INTO PURSUANT  TO  SECTION  FOUR
HUNDRED THREE OF THIS ARTICLE.
  15.  NEW  YORK  COMBAT  VETERANS  HEALTHCARE CHOICE ACCOUNT AGREEMENTS
SHALL BE SUBJECT TO SECTION  FOURTEEN-C  OF  THE  BANKING  LAW  AND  THE
"TRUTH-IN-SAVINGS" REGULATIONS PROMULGATED THEREUNDER.
  16. NOTHING IN THIS ARTICLE OR IN ANY NEW YORK COMBAT VETERANS HEALTH-
CARE  CHOICE  ACCOUNT  AGREEMENT  ENTERED  INTO PURSUANT TO THIS ARTICLE
SHALL BE CONSTRUED AS A GUARANTEE BY THE STATE OR ANY HEALTHCARE PROVID-
ER THAT A BENEFICIARY WILL BE ADMITTED TO AN ELIGIBLE HEALTHCARE  INSTI-
TUTION, OR, UPON ADMISSION TO AN ELIGIBLE HEALTHCARE INSTITUTION WILL BE
PERMITTED TO REMAIN IN SUCH ELIGIBLE HEALTHCARE INSTITUTION.
  S 405. PROGRAM LIMITATIONS; NEW YORK COMBAT VETERANS HEALTHCARE CHOICE
ACCOUNT. 1. NOTHING IN THIS ARTICLE SHALL BE CONSTRUED TO:
  A.  GIVE  ANY DESIGNATED BENEFICIARY ANY RIGHTS OR LEGAL INTEREST WITH
RESPECT TO AN ACCOUNT UNLESS THE DESIGNATED BENEFICIARY IS  THE  ACCOUNT
OWNER;
  B.  GUARANTEE  THAT  A  DESIGNATED  BENEFICIARY WILL BE ADMITTED TO AN
ELIGIBLE HEALTHCARE INSTITUTION;
  C. CREATE STATE RESIDENCY FOR AN INDIVIDUAL MERELY BECAUSE  THE  INDI-
VIDUAL IS A DESIGNATED BENEFICIARY; OR
  D. GUARANTEE THAT AMOUNTS SAVED PURSUANT TO THE PROGRAM WILL BE SUFFI-
CIENT TO COVER THE QUALIFIED HEALTHCARE EXPENSES OF A DESIGNATED BENEFI-
CIARY.
  2.  A.  NOTHING IN THIS ARTICLE SHALL CREATE OR BE CONSTRUED TO CREATE
ANY OBLIGATION OF THE COMPTROLLER, THE STATE, OR ANY AGENCY  OR  INSTRU-
MENTALITY OF THE STATE TO GUARANTEE FOR THE BENEFIT OF ANY ACCOUNT OWNER
OR DESIGNATED BENEFICIARY WITH RESPECT TO:
  (I) THE RATE OF INTEREST OR OTHER RETURN ON ANY ACCOUNT; AND
  (II) THE PAYMENT OF INTEREST OR OTHER RETURN ON ANY ACCOUNT.
  B.  THE  COMPTROLLER  AND  THE  DIVISION  BY  RULE OR REGULATION SHALL
PROVIDE THAT EVERY CONTRACT, APPLICATION, DEPOSIT SLIP, OR OTHER SIMILAR
DOCUMENT THAT MAY BE USED  IN  CONNECTION  WITH  A  CONTRIBUTION  TO  AN
ACCOUNT  CLEARLY  INDICATE  THAT THE ACCOUNT IS NOT INSURED BY THE STATE
AND NEITHER THE PRINCIPAL DEPOSITED NOR THE INVESTMENT RETURN IS GUARAN-
TEED BY THE STATE.
  S 4. The state finance law is amended by adding a new  section  81  to
read as follows:
  S  81.  NEW YORK COMBAT VETERANS HEALTHCARE CHOICE PROGRAM TRUST FUND.
1. THERE IS HEREBY ESTABLISHED IN THE SOLE CUSTODY OF  THE  STATE  COMP-
TROLLER  A  SPECIAL  FUND  TO  BE  KNOWN AS THE NEW YORK COMBAT VETERANS
HEALTHCARE CHOICE PROGRAM TRUST FUND. ALL PAYMENTS FROM SUCH FUND  SHALL
BE  MADE IN ACCORDANCE WITH ARTICLE FOURTEEN OF THE MILITARY LAW AND THE
MEMORANDUM OF UNDERSTANDING ENTERED INTO PURSUANT THERETO ON  THE  AUDIT
OF THE STATE COMPTROLLER.

S. 8148                             8

  2. THE FUND SHALL BE A TRUST FUND AND SHALL CONSIST OF A TRUST ACCOUNT
AND  AN  OPERATING  ACCOUNT.  THE  TRUST  ACCOUNT  SHALL INCLUDE AMOUNTS
RECEIVED BY THE NEW  YORK  COMBAT  VETERANS  HEALTHCARE  CHOICE  PROGRAM
PURSUANT  TO  NEW  YORK COMBAT VETERANS HEALTHCARE CHOICE ACCOUNT AGREE-
MENTS,  ADMINISTRATIVE  CHARGES, FEES, AND ALL OTHER AMOUNTS RECEIVED BY
THE PROGRAM FROM OTHER  SOURCES,  AND  INTEREST  AND  INVESTMENT  INCOME
EARNED BY THE TRUST FUND. THE COMPTROLLER SHALL, FROM TIME TO TIME, MAKE
TRANSFERS  FROM THE TRUST ACCOUNT TO THE OPERATING ACCOUNT FOR THE IMME-
DIATE PAYMENT OF OBLIGATIONS UNDER NEW YORK COMBAT  VETERANS  HEALTHCARE
CHOICE  ACCOUNT  AGREEMENTS, OPERATING EXPENSES AND ADMINISTRATIVE COSTS
OF THE NEW YORK COMBAT VETERANS HEALTHCARE CHOICE  ACCOUNT.  ADMINISTRA-
TIVE  COSTS  SHALL BE PAID OUT OF THE OPERATING ACCOUNT ACCORDING TO THE
TERMS AND CONDITIONS ESTABLISHED PURSUANT TO THE PROVISIONS  OF  SECTION
FOUR HUNDRED THREE OF THE MILITARY LAW.
  3.  (A)  THE  COMPTROLLER,  AS TRUSTEE, SHALL INVEST THE ASSETS OF THE
TRUST FUND IN INVESTMENTS AUTHORIZED BY ARTICLE FOUR-A OF THE RETIREMENT
AND SOCIAL SECURITY LAW, PROVIDED HOWEVER, THAT:
  (I) THE PROVISIONS OF PARAGRAPH (A) OF SUBDIVISION TWO OF SECTION  ONE
HUNDRED  SEVENTY-SEVEN  OF  THE RETIREMENT AND SOCIAL SECURITY LAW SHALL
NOT APPLY EXCEPT FOR THE FIRST CLAUSE OF SUBPARAGRAPH (II) OF SUCH PARA-
GRAPH; AND
  (II) NOTWITHSTANDING THE PROVISIONS OF SUBDIVISION  SEVEN  OF  SECTION
ONE  HUNDRED  SEVENTY-SEVEN OF THE RETIREMENT AND SOCIAL SECURITY LAW OR
ANY OTHER LAW TO THE CONTRARY, THE ASSETS  OF  THE  TRUST  FUND  MAY  BE
INVESTED  IN  ANY  FUNDING  AGREEMENT  ISSUED IN ACCORDANCE WITH SECTION
THREE THOUSAND TWO HUNDRED TWENTY-TWO OF THE INSURANCE LAW BY A DOMESTIC
LIFE INSURANCE COMPANY OR A FOREIGN LIFE INSURANCE COMPANY  DOING  BUSI-
NESS IN THIS STATE, SUBJECT TO THE FOLLOWING:
  (1) SUCH A FUNDING AGREEMENT MAY PROVIDE FOR A GUARANTEED MINIMUM RATE
OF RETURN;
  (2)  SUCH  A  FUNDING  AGREEMENT MAY BE ALLOCATED AS EITHER A SEPARATE
ACCOUNT OR A GENERAL ACCOUNT OF  THE  ISSUER,  AS  THE  COMPTROLLER  MAY
DECIDE;
  (3)  TOTAL INVESTMENTS OF THE TRUST FUND PURSUANT TO THIS PARAGRAPH IN
ANY FUNDING AGREEMENTS ISSUED BY A SINGLE LIFE INSURANCE  COMPANY  WHICH
ARE  ALLOCATED  AS  A  GENERAL  ACCOUNT  OF THE ISSUER SHALL NOT, IN THE
AGGREGATE, EXCEED THREE HUNDRED FIFTY MILLION DOLLARS; AND
  (4) NO ASSETS OF THE TRUST FUND SHALL BE INVESTED IN ANY SUCH  FUNDING
AGREEMENT  UNLESS,  AT  THE  TIME  OF SUCH INVESTMENT, THE GENERAL OBLI-
GATIONS OR FINANCIAL STRENGTH OF THE ISSUER  HAVE  RECEIVED  EITHER  THE
HIGHEST  OR  SECOND  HIGHEST  RATING BY TWO NATIONALLY RECOGNIZED RATING
SERVICES OR BY ONE NATIONALLY RECOGNIZED RATING  SERVICE  IN  THE  EVENT
THAT ONLY ONE SUCH SERVICE RATES SUCH OBLIGATIONS.
  (B)  TRUST FUND ASSETS SHALL BE KEPT SEPARATE AND SHALL NOT BE COMMIN-
GLED WITH OTHER ASSETS, EXCEPT AS PROVIDED IN THIS  SECTION.  THE  COMP-
TROLLER  MAY  ENTER  INTO CONTRACTS TO PROVIDE FOR INVESTMENT ADVICE AND
MANAGEMENT, CUSTODIAL SERVICES, AND OTHER PROFESSIONAL SERVICES FOR  THE
ADMINISTRATION AND INVESTMENT OF THE PROGRAM. ADMINISTRATIVE FEES, COSTS
AND EXPENSES, INCLUDING INVESTMENT FEES AND EXPENSES, SHALL BE PAID FROM
THE ASSETS OF THE FUND.
  4.  THE  COMPTROLLER SHALL PROVIDE FOR THE ADMINISTRATION OF THE TRUST
FUND,  INCLUDING  MAINTAINING  PARTICIPANT  RECORDS  AND  ACCOUNTS,  AND
PROVIDING  ANNUAL  AUDITED  REPORTS.  THE  COMPTROLLER  MAY  ENTER  INTO
CONTRACTS TO PROVIDE ADMINISTRATIVE SERVICES AND REPORTING.
  S 5. Section 5205 of the civil practice law and rules  is  amended  by
adding a new subdivision (p) to read as follows:

S. 8148                             9

  (P)  EXEMPTION  FOR NEW YORK COMBAT VETERANS HEALTHCARE CHOICE PROGRAM
TRUST FUND PAYMENT MONIES. MONIES IN  AN  ACCOUNT  CREATED  PURSUANT  TO
ARTICLE  FOURTEEN OF THE MILITARY LAW ARE EXEMPT FROM APPLICATION TO THE
SATISFACTION OF A MONEY JUDGMENT.
  S 6. Subsection (b) of section 612 of the tax law is amended by adding
a new paragraph 43 to read as follows:
  (43)  DISTRIBUTIONS RECEIVED DURING THE TAXABLE YEAR BY A DISTRIBUTION
OF A NEW YORK COMBAT  VETERANS  HEALTHCARE  CHOICE  ACCOUNT  ESTABLISHED
PURSUANT  TO  ARTICLE  FOURTEEN  OF THE MILITARY LAW, TO THE EXTENT SUCH
DISTRIBUTIONS ARE NOT QUALIFIED WITHDRAWALS WITHIN THE MEANING OF SUBDI-
VISION TEN OF SECTION FOUR HUNDRED TWO OF THE MILITARY LAW.
  S 7. Subsection (c) of section 612 of the tax law is amended by adding
two new paragraphs 44 and 45 to read as follows:
  (44) CONTRIBUTIONS MADE DURING THE TAXABLE YEAR BY AN ACCOUNT OWNER TO
ONE OR MORE NEW YORK COMBAT VETERANS HEALTHCARE CHOICE  ACCOUNTS  ESTAB-
LISHED  PURSUANT  TO ARTICLE FOURTEEN OF THE MILITARY LAW, TO THE EXTENT
NOT DEDUCTIBLE OR ELIGIBLE FOR CREDIT FOR FEDERAL INCOME  TAX  PURPOSES,
PROVIDED,  HOWEVER,  THE  EXCLUSION PROVIDED FOR IN THIS PARAGRAPH SHALL
NOT EXCEED FIVE THOUSAND DOLLARS FOR AN INDIVIDUAL OR HEAD OF HOUSEHOLD,
AND FOR MARRIED COUPLES WHO FILE JOINT TAX RETURNS, SHALL NOT EXCEED TEN
THOUSAND DOLLARS; PROVIDED, FURTHER, THAT SUCH EXCLUSION SHALL BE AVAIL-
ABLE ONLY TO THE ACCOUNT OWNER AND NOT TO ANY OTHER PERSON.
  (45) DISTRIBUTIONS FROM A NEW YORK COMBAT VETERANS  HEALTHCARE  CHOICE
ACCOUNT ESTABLISHED PURSUANT TO ARTICLE FOURTEEN OF THE MILITARY LAW, TO
THE EXTENT INCLUDIBLE IN GROSS INCOME FOR FEDERAL INCOME TAX PURPOSES.
  S 8. Subsection (d) of section 658 of the tax law is amended by adding
a new paragraph 4 to read as follows:
  (4)  THE  COMMISSIONER  MAY  BY  REGULATION OR INSTRUCTION REQUIRE THE
FILING OF A REPORT ANNUALLY BY THE COMPTROLLER OR PROGRAM MANAGER OF THE
NEW  YORK COMBAT VETERANS HEALTHCARE CHOICE PROGRAM, OR THEIR  DESIGNEE,
SETTING  FORTH  THE  NAMES AND IDENTIFICATION NUMBERS OF ACCOUNT OWNERS,
DESIGNATED BENEFICIARIES AND DISTRIBUTEES OF NEW  YORK  COMBAT  VETERANS
HEALTHCARE  CHOICE  PROGRAM  ACCOUNTS,  THE  AMOUNTS CONTRIBUTED TO SUCH
ACCOUNTS, THE AMOUNTS DISTRIBUTED FROM SUCH ACCOUNTS AND THE  NATURE  OF
SUCH DISTRIBUTIONS AS QUALIFIED WITHDRAWALS OR AS WITHDRAWALS OTHER THAN
QUALIFIED WITHDRAWALS, AND ANY SUCH OTHER INFORMATION AS THE COMMISSION-
ER  MAY  REQUIRE  REGARDING  THE  TAXATION UNDER THIS ARTICLE OF AMOUNTS
CONTRIBUTED TO OR WITHDRAWN FROM SUCH  ACCOUNTS.  THE  COMMISSIONER  MAY
REQUIRE  THAT  ANY SUCH REPORT ALSO BE MADE TO THE ACCOUNT OWNER, DESIG-
NATED BENEFICIARY OR DISTRIBUTEE OF ANY SUCH ACCOUNT.
  S 9. This act shall take effect immediately and shall apply to taxable
years beginning after December 31, 2016.

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