S T A T E O F N E W Y O R K
________________________________________________________________________
8817
I N S E N A T E
January 8, 2026
___________
Introduced by Sen. COONEY -- read twice and ordered printed, and when
printed to be committed to the Committee on Rules
AN ACT to amend the insurance law and the public health law, in relation
to the use of virtual credit cards by insurers and certain health care
plans; and to amend a chapter of the laws of 2025 amending the insur-
ance law and the public health law relating to the use of virtual
credit cards by insurers and certain health care plans, as proposed in
legislative bills numbers S. 2105-A and A. 3986-A, in relation to the
effectiveness thereof
THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:
Section 1. Subsection (p) of section 3217-b of the insurance law, as
added by a chapter of the laws of 2025 amending the insurance law and
the public health law relating to the use of virtual credit cards by
insurers and certain health care plans, as proposed in legislative bills
numbers S. 2105-A and A. 3986-A, is amended to read as follows:
(p)(1) An insurer may pay a claim for reimbursement made by a provider
using a credit card, virtual credit card, or electronic funds transfer
payment method that imposes on the provider a specifically identified
fee or similar dedicated charge to process the payment if in advance of
using such reimbursement method:
(A) The insurer notifies the provider of the potential fees or other
charges associated with the use of the credit card, virtual credit card,
or electronic funds transfer payment;
(B) The insurer offers the provider an alternative payment method that
does not impose fees or similar charges on the provider; and
(C) The provider or a designee of the provider elects to accept
payment of the claim using the credit card, virtual credit card, or
electronic funds transfer payment method. SUCH PAYMENT TYPE ELECTION
SHALL BE MADE BY THE PROVIDER WITHIN THIRTY DAYS OF RECEIPT OF THE
NOTICE FROM THE INSURER. IF THE PROVIDER FAILS TO MAKE ANY PAYMENT TYPE
ELECTION WITHIN THIRTY DAYS, THE INSURER SHALL PAY THE PROVIDER USING
THE ALTERNATIVE PAYMENT METHOD OFFERED IN THE NOTICE UNLESS THE INSURER
IS UNABLE TO PAY THE PROVIDER USING THAT ALTERNATIVE METHOD DUE TO THE
EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD03607-06-6
S. 8817 2
INSURER LACKING INFORMATION NECESSARY TO MAKE THE ALTERNATIVE PAYMENT.
IN THAT INSTANCE, THE INSURER MAY USE ANOTHER FEE-FREE METHOD OF PAYMENT
IN ORDER TO MEET THE TIMEFRAMES ESTABLISHED IN SECTION THREE THOUSAND
TWO HUNDRED TWENTY-FOUR-A OF THIS ARTICLE.
(2) A decision pursuant to paragraph one of this subsection shall
remain in effect until the provider notifies the insurer, in writing, of
a change in the designated payment type.
(3) If an insurer contracts with a vendor to process payments of
providers' claims, the insurer shall require the vendor to comply with
the provisions of paragraph one of this subsection. THIS PARAGRAPH SHALL
NOT APPLY TO A VENDOR USED BY THE PROVIDER IN ORDER TO RECEIVE PAYMENTS
FROM AN INSURER.
(4) No [policy or] contract BETWEEN AN INSURER AND PROVIDER issued,
renewed, modified, altered or amended after the effective date of this
[section] SUBSECTION shall contain provisions allowing for waiver of the
notice requirements contained in this subsection.
(5) For any contract that is in effect on or before the effective date
of this subsection or that is entered into, amended or renewed on or
after the effective date of this subsection, an insurer that initiates a
payment to a provider using, or changes the payment method to, a health
care electronic funds transfers and remittance advice transaction shall
not charge a fee solely to transmit the payment to the provider unless
the provider [consents to the fee] ELECTS TO ACCEPT PAYMENT IN ACCORD-
ANCE WITH SUBPARAGRAPH (C) OF PARAGRAPH ONE OF THIS SUBSECTION.
(6) For purposes of this subsection, the following terms shall have
the following meanings:
(A) "Provider" shall mean a health care professional or a group of
health care professionals licensed pursuant to title eight of the educa-
tion law that has a participating provider contract with an insurer to
provide health care services to an insured.
(B) "Virtual credit card" shall mean a single-use series of numbers
linked to a fixed dollar amount and provided by an insurer to a provider
for the purpose of paying a claim for health care services performed by
the provider.
§ 2. Subsection (p) of section 4325 of the insurance law, as added by
a chapter of the laws of 2025 amending the insurance law and the public
health law relating to the use of virtual credit cards by insurers and
certain health care plans, as proposed in legislative bills numbers S.
2105-A and A. 3986-A, is amended to read as follows:
(p) (1) A corporation organized under this article may pay a claim for
reimbursement made by a provider using a credit card, virtual credit
card, or electronic funds transfer payment method that imposes on the
provider a specifically identified fee or similar charge dedicated to
process the payment if in advance of using such reimbursement method:
(A) The corporation notifies the provider of the potential fees or
other charges associated with the use of the credit card, virtual credit
card, or electronic funds transfer payment;
(B) The corporation offers the provider an alternative payment method
that does not impose fees or similar charges on the provider; and
(C) The provider or a designee of the provider elects to accept
payment of the claim using the credit card, virtual credit card, or
electronic funds transfer payment method. SUCH PAYMENT TYPE ELECTION
SHALL BE MADE BY THE PROVIDER WITHIN THIRTY DAYS OF RECEIPT OF THE
NOTICE FROM THE INSURER. IF THE PROVIDER FAILS TO MAKE ANY PAYMENT TYPE
ELECTION WITHIN THIRTY DAYS, THE INSURER SHALL PAY THE PROVIDER USING
THE ALTERNATIVE PAYMENT METHOD OFFERED IN THE NOTICE UNLESS THE INSURER
S. 8817 3
IS UNABLE TO PAY THE PROVIDER USING THAT ALTERNATIVE METHOD DUE TO THE
INSURER LACKING INFORMATION NECESSARY TO MAKE THE ALTERNATIVE PAYMENT.
IN THAT INSTANCE, THE INSURER MAY USE ANOTHER FEE-FREE METHOD OF PAYMENT
IN ORDER TO MEET THE TIMEFRAMES ESTABLISHED IN SECTION THREE THOUSAND
TWO HUNDRED TWENTY-FOUR-A OF THIS CHAPTER.
(2) A decision pursuant to paragraph one of this subsection shall
remain in effect until the provider notifies the corporation, in writ-
ing, of a change to the designated payment type.
(3) If a corporation contracts with a vendor to process payments of
providers' claims, the insurer shall require the vendor to comply with
the provisions of paragraph one of this subsection. THIS PARAGRAPH SHALL
NOT APPLY TO A VENDOR USED BY THE PROVIDER IN ORDER TO RECEIVE PAYMENTS
FROM AN INSURER.
(4) No [policy or] contract BETWEEN A CORPORATION ORGANIZED UNDER THIS
ARTICLE AND PROVIDER issued, renewed, modified, altered or amended after
the effective date of this [section] SUBSECTION shall contain provisions
allowing for waiver of the notice requirements contained in this
subsection.
(5) For any contract that is in effect on or before the effective date
of this subsection or that is entered into, amended or renewed on or
after the effective date of this subsection, a corporation that initi-
ates a payment to a provider using, or changes the payment method to, a
health care electronic funds transfers and remittance advice transaction
shall not charge a fee solely to transmit the payment to the provider
unless the provider elects to accept payment in accordance with subpara-
graph [(B)] (C) of paragraph one of this subsection.
(6) For purposes of this subsection, the following terms shall have
the following meanings:
(A) "Provider" shall mean a health care professional or a group of
health care professionals licensed pursuant to title eight of the educa-
tion law that has a participating provider contract with a corporation
to provide health care services to an insured.
(B) "Virtual credit card" shall mean a single-use series of numbers
linked to a fixed dollar amount and provided by a corporation organized
under this article to a provider for the purpose of paying a claim for
health care services performed by the provider.
§ 3. Subdivision 14 of section 4406-c of the public health law, as
added by a chapter of the laws of 2025 amending the insurance law and
the public health law relating to the use of virtual credit cards by
insurers and certain health care plans, as proposed in legislative bills
numbers S. 2105-A and A. 3986-A, is amended to read as follows:
14. (a) A health care plan may pay a claim for reimbursement made by a
provider using a credit card, virtual credit card, or electronic funds
transfer payment method that imposes on the provider a specifically
identified fee or similar dedicated charge to process the payment if in
advance of using such reimbursement method:
(i) The health care plan notifies the provider of the potential fees
or other charges associated with the use of the credit card, virtual
credit card, or electronic funds transfer payment;
(ii) The health care plan offers the provider an alternative payment
method that does not impose fees or similar charges on the provider; and
(iii) The provider or a designee of the provider elects to accept
payment of the claim using the credit card, virtual credit card, or
electronic funds transfer payment method. SUCH PAYMENT TYPE ELECTION
SHALL BE MADE BY THE PROVIDER WITHIN THIRTY DAYS OF RECEIPT OF THE
NOTICE FROM THE INSURER. IF THE PROVIDER FAILS TO MAKE ANY PAYMENT TYPE
S. 8817 4
ELECTION WITHIN THIRTY DAYS, THE INSURER SHALL PAY THE PROVIDER USING
THE ALTERNATIVE PAYMENT METHOD OFFERED IN THE NOTICE UNLESS THE INSURER
IS UNABLE TO PAY THE PROVIDER USING THAT ALTERNATIVE METHOD DUE TO THE
INSURER LACKING INFORMATION NECESSARY TO MAKE THE ALTERNATIVE PAYMENT.
IN THAT INSTANCE, THE INSURER MAY USE ANOTHER FEE-FREE METHOD OF PAYMENT
IN ORDER TO MEET THE TIMEFRAMES ESTABLISHED IN SECTION THREE THOUSAND
TWO HUNDRED TWENTY-FOUR-A OF THE INSURANCE LAW.
(b) A decision pursuant to paragraph (a) of this subdivision shall
remain in effect until the provider notifies the health care plan, in
writing, of a change to the designated payment type.
(c) If a health care plan contracts with a vendor to process payments
of providers' claims, the health care plan shall require the vendor to
comply with the provisions of paragraph (a) of this subdivision. THIS
PARAGRAPH SHALL NOT APPLY TO A VENDOR USED BY THE PROVIDER IN ORDER TO
RECEIVE PAYMENTS FROM AN INSURER.
(d) No [policy or] contract BETWEEN A HEALTH CARE PLAN AND PROVIDER
issued, renewed, modified, altered or amended after the effective date
of this [section] SUBDIVISION shall contain provisions allowing for
waiver of the notice requirements contained in this subdivision.
(e) For any contract that is in effect on or before the effective date
of this subdivision or that is entered into, amended or renewed on or
after the effective date of this subdivision, a health care plan that
initiates a payment to a provider using, or changes the payment method
to, a health care electronic funds transfers and remittance advice tran-
saction shall not charge a fee solely to transmit the payment to the
provider unless the provider elects to accept payment in accordance with
subparagraph [(ii)] (III) of paragraph (a) of this subdivision.
(f) For purposes of this [section] SUBDIVISION, the following defi-
nitions shall apply:
(i) "Provider" shall mean a health care professional or a group of
health care professionals licensed pursuant to title eight of the educa-
tion law that has a participating provider contract with a health care
plan to provide health care services to an enrollee.
(ii) "Virtual credit card" shall mean a single-use series of numbers
linked to a fixed dollar amount and provided by a health care plan to a
provider for the purpose of paying a claim for health care services
performed by the provider.
§ 4. Section 4 of a chapter of the laws of 2025 amending the insurance
law and the public health law relating to the use of virtual credit
cards by insurers and certain health care plans, as proposed in legisla-
tive bills numbers S. 2105-A and A. 3986-A, is amended to read as
follows:
§ 4. This act shall take effect on the one hundred eightieth day after
it shall have become a law and shall apply to [policies and] contracts
issued, renewed, modified, altered or amended on and after such date.
§ 5. This act shall take effect immediately; provided, however,
sections one, two, and three of this act shall take effect on the same
date and in the same manner as a chapter of the laws of 2025 amending
the insurance law and the public health law relating to the use of
virtual credit cards by insurers and certain health care plans, as
proposed in legislative bills numbers S. 2105-A and A. 3986-A, takes
effect.
