S. 6795 2
1. ["Birth-related neurological injury" means an injury to the brain
or spinal cord of a live infant caused by the deprivation of oxygen or
mechanical injury occurring in the course of labor, delivery or resusci-
tation, or by other medical services provided or not provided during
delivery admission, that rendered the infant with a permanent and
substantial motor impairment or with a developmental disability as that
term is defined by section 1.03 of the mental hygiene law, or both. This
definition shall apply to live births only.
2.] "Fund" means the New York state medical indemnity fund.
2. "NEUROLOGICAL INJURY" MEANS AN INJURY TO THE BRAIN OR SPINAL CORD
OF A PERSON CAUSED BY MEDICAL SERVICES PROVIDED OR NOT PROVIDED THAT
RENDERED THE PERSON WITH A:
(A) PERMANENT AND SUBSTANTIAL MOTOR IMPAIRMENT, AND/OR
(B) DISABILITY THAT (I) IS ATTRIBUTABLE TO (A) DEVELOPMENTAL DISABILI-
TIES, CEREBRAL PALSY, EPILEPSY, NEUROLOGICAL IMPAIRMENT, FAMILIAL DYSAU-
TONOMIA OR AUTISM; (B) ANY OTHER CONDITION OF A PERSON FOUND TO BE
CLOSELY RELATED TO DEVELOPMENTAL DISABILITIES BECAUSE SUCH CONDITION
RESULTS IN SIMILAR IMPAIRMENT OF GENERAL INTELLECTUAL FUNCTIONING OR
ADAPTIVE BEHAVIOR TO THAT OF DEVELOPMENTALLY DISABLED PERSONS OR
REQUIRES TREATMENT AND SERVICES SIMILAR TO THOSE REQUIRED FOR SUCH
PERSON; OR (C) DYSLEXIA RESULTING FROM A DISABILITY DESCRIBED IN SUBPAR-
AGRAPH (A) OR (B) OF THIS PARAGRAPH; (II) HAS CONTINUED OR CAN BE
EXPECTED TO CONTINUE INDEFINITELY; AND (III) CONSTITUTES A SUBSTANTIAL
HANDICAP TO SUCH PERSON'S ABILITY TO FUNCTION NORMALLY IN SOCIETY.
3. "Qualifying health care costs" means the future medical, hospital,
surgical, nursing, dental, rehabilitation, habilitation, respite, custo-
dial, durable medical equipment, home modifications, assistive technolo-
gy, vehicle modifications, transportation for purposes of health care
related appointments, prescription and non-prescription medications, and
other health care costs actually incurred for services rendered to and
supplies utilized by qualified plaintiffs, which are necessary to meet
their health care needs, as determined by their treating physicians,
physician assistants, or nurse practitioners and as otherwise defined by
the commissioner in regulation.
4. "Qualified plaintiff" means every plaintiff or claimant who (i) has
been found by a jury or court to have sustained a [birth-related] neuro-
logical injury as the result of medical malpractice, or (ii) has
sustained a [birth-related] neurological injury as the result of alleged
medical malpractice, and has settled his or her lawsuit or claim there-
for.
5. Any reference to the "department of financial services" and the
"superintendent of financial services" in this title shall mean, prior
to October third, two thousand eleven, respectively, the "department of
insurance" and "superintendent of insurance."
§ 3. Section 2999-i of the public health law, as added by section 52
of part H of chapter 59 of the laws of 2011, subdivision 1 as amended by
section 29 of part D of chapter 56 of the laws of 2012, is amended to
read as follows:
§ 2999-i. Custody and administration of the fund. 1. (a) The commis-
sioner of taxation and finance shall be the custodian of the fund and
the special account established pursuant to section ninety-nine-t of the
state finance law. All payments from the fund shall be made by the
commissioner of taxation and finance upon certificates signed by the
superintendent of financial services, or his or her designee, as herein-
after provided. The fund shall be separate and apart from any other fund
and from all other state monies; provided, however, that monies of the
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fund may be invested as set forth in paragraph (b) of this subdivision.
No monies from the fund shall be transferred to any other fund, nor
shall any such monies be applied to the making of any payment for any
purpose other than the purpose set forth in this title.
(b) Any monies of the fund not required for immediate use may, at the
discretion of the [commissioner] SUPERINTENDENT of financial services in
consultation with the commissioner of health and the director of the
budget, be invested by the commissioner of taxation and finance in obli-
gations of the United States or the state or obligations the principal
and interest of which are guaranteed by the United States or the state.
The proceeds of any such investment shall be retained by the fund as
assets to be used for the purposes of the fund.
2. (a) The fund shall be administered by the superintendent of finan-
cial services or his or her designee in accordance with the provisions
of this article.
(b) The superintendent of financial services shall have all powers
necessary and proper to carry out the purposes of the fund.
(c) Notwithstanding any contrary provision of this section, sections
one hundred twelve and one hundred sixty-three of the state finance law
or any other contrary provision of law, the superintendent of financial
services is authorized to enter into a contract or contracts without a
competitive bid or request for proposal process for purposes of adminis-
tering the fund for the first year of its operation and in preparation
therefor.
(d) The department of financial services and the department OF HEALTH
shall post on their websites information about the fund, eligibility for
enrollment in the fund, and the process for enrollment in the fund.
3. The expense of administering the fund, including the expenses
incurred by the department OF FINANCIAL SERVICES AND/OR THE DEPARTMENT
OF HEALTH, shall be paid from the fund.
4. Monies for the fund will be provided pursuant to this chapter.
5. For the state fiscal year beginning April first, two thousand
[eleven] EIGHTEEN and ending March thirty-first, two thousand [twelve,
the state fiscal year beginning April first, two thousand twelve and
ending March thirty-first, two thousand thirteen, and the state fiscal
year beginning April first, two thousand thirteen and ending March thir-
ty-first, two thousand fourteen] NINETEEN, AND ANNUALLY THEREAFTER, the
superintendent of financial services shall cause to be deposited into
the fund for each such fiscal year the amount appropriated for such
purpose. [Beginning April first, two thousand fourteen and annually
thereafter, the superintendent of financial services shall cause to be
deposited into the fund, subject to available appropriations, an amount
equal to the difference between the amount appropriated to the fund in
the preceding fiscal year, as increased by the adjustment factor defined
in subdivision seven of this section, and the assets of the fund at the
conclusion of that fiscal year.] THE TOTAL AMOUNT TO BE DEPOSITED INTO
THE FUND SHALL BE BASED UPON AN ACTUARIAL CALCULATION, CONDUCTED QUAR-
TERLY BY THE SUPERINTENDENT OF FINANCIAL SERVICES, OF THE ESTIMATED
LIABILITIES OF THE FUND FOR THE NEXT SUCCEEDING YEAR.
6. (a) Following the deposit referenced in subdivision five of this
section, the superintendent of financial services shall conduct an actu-
arial calculation of the estimated liabilities of the fund for the
coming year resulting from the qualified plaintiffs enrolled in the
fund. The FUND administrator shall from time to time adjust such calcu-
lation. If the total of all estimates of current liabilities equals or
exceeds eighty percent of the fund's assets, then the fund shall not
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accept any new enrollments until a new deposit has been made pursuant to
subdivision five of this section. When, as a result of such new deposit,
the fund's liabilities no longer exceed eighty percent of the fund's
assets, the fund administrator shall enroll new qualified plaintiffs in
the order that an application for enrollment has been submitted in
accordance with subdivision seven of section twenty-nine hundred nine-
ty-nine-j of this title.
(b) Whenever enrollment is suspended pursuant to paragraph (a) of this
subdivision and until such time as enrollment resumes pursuant to such
paragraph: (i) notice of such suspension shall be promptly posted on the
[department's] website OF THE DEPARTMENT OF HEALTH and on the website of
the department of financial services; (ii) the fund administrator shall
deny each application for enrollment that had been received but not
accepted prior to the date of suspension and each application for
enrollment received ON AND after the date of such suspension; and (iii)
notification of each such denial shall be made to the plaintiff or
claimant or persons authorized to act on behalf of such plaintiff or
claimant and all defendants in regard to such plaintiff or claimant, to
the extent they are known to the fund administrator. Judgments and
settlements for plaintiffs or claimants for whom applications are denied
under this paragraph or who are not eligible for enrollment due to
suspension pursuant to paragraph (a) of this subdivision shall be satis-
fied as if this title had not been enacted.
(c) Following a suspension, whenever enrollment resumes pursuant to
paragraph (a) of this subdivision, notice that enrollment has resumed
shall be promptly posted on the [department's] website OF THE DEPARTMENT
OF HEALTH and on the website of the department of financial services.
(d) The suspension of enrollment pursuant to paragraph (a) of this
subdivision shall not impact payment under the fund for any qualified
plaintiffs already enrolled in the fund.
[7. For purposes of this section, the adjustment factor referenced in
this section shall be the ten year rolling average medical component of
the consumer price index as published by the United States department of
labor, bureau of labor statistics, for the preceding ten years.]
§ 4. Section 2999-j of the public health law, as added by section 52
of part H of chapter 59 of the laws of 2011, subdivisions 2 and 4 as
amended by chapter 517 of the laws of 2016, and paragraph (c) of subdi-
vision 2 as amended by chapter 4 of laws of 2017, is amended to read as
follows:
§ 2999-j. Payments from the fund. 1. The fund shall be used to pay the
qualifying health care costs of qualified plaintiffs.
2. The provision of qualifying health care costs to qualified plain-
tiffs shall not be subject to prior authorization, except as described
by the commissioner in regulation; provided, however:
(a) such regulation shall not prevent qualified plaintiffs from
receiving care or assistance that would, at a minimum, be authorized
under the medicaid program;
(b) if any prior authorization is required by such regulation, the
regulation shall require that requests for prior authorization be proc-
essed within a reasonably prompt period of time and[, subject to the
provisions of subdivision two-a of this section,] shall identify a proc-
ess for prompt administrative review of any denial of a request for
prior authorization; and
(c) such regulations shall not prohibit qualifying health care costs
on the grounds that the qualifying health care cost may incidentally
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benefit other members of the household, provided that whether the quali-
fying health care cost primarily benefits the patient may be considered.
3. In determining the amount of qualifying health care costs to be
paid from the fund, any such cost or expense that was or will, with
reasonable certainty, be paid, replaced or indemnified from any collat-
eral source as provided by subdivision (a) of section forty-five hundred
forty-five of the civil practice law and rules shall not constitute a
qualifying health care cost and shall not be paid from the fund. For
purposes of this title, "collateral source" shall not include [medicare]
MEDICARE or Medicaid.
4. The amount of qualifying health care costs to be paid from the fund
shall be calculated on the basis of one hundred percent of the usual and
customary cost. For the purposes of this section, "usual and customary
costs" shall mean the eightieth percentile of all charges for the
particular health care service performed by a provider in the same or
similar specialty and provided in the same geographical area as reported
in a benchmarking database maintained by a nonprofit organization speci-
fied by the superintendent of financial services. If no such rates are
available qualifying health care costs shall be calculated on the basis
of no less than one hundred thirty percent of Medicaid or Medicare rates
of reimbursement, whichever is higher. If no such rate exists, costs
shall be reimbursed as defined by the commissioner in regulation.
5. Claims for the payment or reimbursement from the fund of qualifying
health care costs shall be made upon forms prescribed and furnished by
the fund administrator in consultation with the commissioner and in
conjunction with regulations establishing a mechanism for submission of
claims by health care providers directly to the fund, where practicable.
6. (a) Every settlement agreement for claims arising out of a
plaintiff's or claimant's [birth related] neurological injury subject to
this title, and that provides for the payment of future [medical
expenses] HEALTH CARE COSTS for the plaintiff or claimant, SHALL BE
SUBMITTED FOR COURT REVIEW AND APPROVAL AND shall provide that, in the
event the [administrator of the fund determines that the plaintiff or
claimant is a qualified plaintiff] COURT FINDS THAT THERE HAS BEEN A
PRIMA FACIE SHOWING THAT THE PLAINTIFF OR CLAIMANT IS A QUALIFIED PLAIN-
TIFF, all payments for future [medical expenses] HEALTH CARE COSTS shall
be paid in accordance with this title, in lieu of that portion of the
settlement agreement that provides for payment of such [expenses] FUTURE
HEALTH CARE COSTS. The plaintiff's or claimant's future medical expenses
shall be paid in accordance with this title. When such a settlement
agreement does not so provide, the court shall direct the modification
of the agreement to include such term as a condition of court approval.
(b) In any case where the jury or court has made an award for future
[medical expenses] HEALTH CARE COSTS arising out of a [birth related]
neurological injury, [any party to such action or person authorized to
act on behalf of such party may make application to the court that]
SUBJECT TO THIS TITLE, THE COURT SHALL DETERMINE IF THERE HAS BEEN A
PRIMA FACIE SHOWING THAT THE PLAINTIFF OR CLAIMANT IS A QUALIFIED PLAIN-
TIFF, AND, IF THE COURT SHALL SO DETERMINE, the judgment SHALL reflect
that, in lieu of that portion of the award that provides for payment of
such [expenses, and upon a determination by the fund administrator that
the plaintiff is a qualified plaintiff] FUTURE HEALTH CARE COSTS, the
future [medical expenses] HEALTH CARE COSTS of the plaintiff OR CLAIMANT
shall be paid out of the fund in accordance with this title. [Upon a
finding by the court that the applicant has made a prima facie showing
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that the plaintiff is a qualified plaintiff, the court shall ensure that
the judgment so provides.]
7. A qualified plaintiff shall be enrolled when [(a)] such plaintiff
or person authorized to act on behalf of such person, upon notice to all
defendants, or any of the defendants in regard to the plaintiff's claim,
upon notice to such plaintiff, makes an application for enrollment by
providing the fund administrator with a certified copy of the judgment
or of the court approved settlement agreement; [and (b) the fund admin-
istrator determines upon the basis of such judgment or settlement agree-
ment and any additional information the fund administrator shall request
that the relevant provisions of subdivision six of this section have
been met and that the plaintiff is a qualified plaintiff;] provided that
no enrollment shall occur when the fund is closed to enrollment pursuant
to subdivision six of section twenty-nine hundred ninety-nine-i of this
title.
8. As to all claims, the fund administrator shall:
(a) determine which of such costs are qualifying health care costs to
be paid from the fund; and
(b) thereupon certify to the commissioner of taxation and finance
those costs that have been determined to be qualifying health care costs
to be paid from the fund.
9. Payments from the fund shall be made by the commissioner of taxa-
tion and finance on the said certificate of the superintendent of finan-
cial services. No payment shall be made by the commissioner of taxation
and finance in excess of the amount certified. Promptly upon receipt of
the said certificate of the superintendent of financial services, the
commissioner of taxation and finance shall pay the qualified plaintiff's
health care provider or reimburse the qualified plaintiff the amount so
certified for payment.
10. Payment from the fund shall not give the fund any right of recov-
ery against any qualified plaintiff or such qualified plaintiff's attor-
ney except in the case of fraud or mistake.
11. All health care providers shall accept from qualified plaintiff's
or persons authorized to act on behalf of such plaintiff's assignments
of the right to receive payments from the fund for qualifying health
care costs.
12. Health insurers (other than [medicare] MEDICARE and Medicaid)
shall be the primary payers of qualifying health care costs of qualified
plaintiffs. Such costs shall be paid from the fund only to the extent
that health insurers or other collateral sources or other persons are
not otherwise obligated to make payments therefor. Health insurers that
make payments for qualifying health care costs to or on behalf of quali-
fied plaintiffs shall have no right of recovery against and shall have
no lien upon the fund or any person or entity nor shall the fund consti-
tute an additional payment source to offset the payments otherwise
contractually required to be made by such health insurers. The super-
intendent of financial services shall have the authority to enforce the
provisions of this subdivision.
13. Except as provided for by this title, with respect to a qualified
plaintiff, no payment shall be required to be made by any defendant or
such defendant's insurer for qualifying health care costs and no judg-
ment shall be made or entered requiring that any such payment be made by
any defendant or such defendant's insurer for such health care costs.
14. The determination of the qualified plaintiff's attorney's fee
shall be based upon the entire sum awarded by the jury or the court or
the full sum of the settlement, as the case may be. The qualified
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plaintiff's attorney's fee shall be paid in a lump sum by the defendants
and their insurers pursuant to section four hundred seventy-four-a of
the judiciary law; provided however that the portion of the [attorney]
ATTORNEY'S fee that is allocated to the non-fund elements of damages
shall be deducted from the non-fund portion of the award in a propor-
tional manner.
15. The commissioner, in consultation with the superintendent of
financial services, shall promulgate, amend and enforce all rules and
regulations necessary for the proper administration of the fund in
accordance with the provisions of this section, including, but not
limited to, those concerning the payment of claims and concerning the
actuarial calculations necessary to determine, annually, the total
amount to be paid into the fund as provided herein, and as otherwise
needed to implement this title.
16. The commissioner shall convene a consumer advisory committee for
the purpose of REVIEWING THE RULES AND REGULATIONS PROMULGATED BY SUBDI-
VISION FIFTEEN OF THIS SECTION AND providing information, as requested
by the commissioner, in the development of [the regulations authorized
by subdivision fifteen of this section] ANY REVISIONS TO SUCH RULES AND
REGULATIONS AND/OR ANY ADDITIONAL RULES AND REGULATIONS REQUIRED TO
IMPLEMENT THIS TITLE.
§ 5. This act shall take effect immediately and shall be deemed to
have been in full force and effect on and after July 1, 2017, provided,
however, that:
(a) if section 5 of chapter 517 of the laws of 2016 shall not have
taken effect on or before such date, then subdivision 4 of section
2999-j of the public health law, as amended by section four of this act,
shall take effect on the same date and in the same manner as such chap-
ter of the laws of 2016 takes effect; provided, further, that the amend-
ments to subdivision 4 of section 2999-j of the public health law made
by section four of this act shall not affect the expiration of such
subdivision and shall be deemed to expire therewith;
(b) with respect to lawsuits involving birth related neurological
injury subject to this title (i.e., an injury to the brain or spinal
cord of a live infant caused by the deprivation of oxygen or mechanical
injury occurring in the course of labor, delivery or resuscitation or by
other medical services provided or not provided during delivery admis-
sion that rendered the infant with a permanent and substantial motor
impairment or with a developmental disability as that term is defined by
section 1.03 of the mental hygiene law, or both), the provisions of this
act shall apply if no judgment has been entered or no settlement agree-
ment has been entered into by the parties before April 1, 2011, and,
with respect to all other lawsuits involving neurological injury subject
to this title, the provisions of this act shall apply if no judgment has
been entered or no settlement has been entered into by the parties
before the effective date of this act;
(c) this act shall not be construed to alter, change, affect, impair
or defeat any rights, obligations, duties or interests accrued, incurred
or conferred prior to the effective date of this act; and
(d) the provisions of this act shall become effective notwithstanding
the failure of the commissioner of health or the superintendent of
financial services to adopt or amend or promulgate rules and regulations
implementing this act.