BILL NUMBER: S5241
SPONSOR: FERNANDEZ
 
TITLE OF BILL:
An act to amend the insurance law and the public health law, in relation
to utilization review determinations
 
PURPOSE OR GENERAL IDEA OF BILL:
To increase access to appropriate care by requiring health insurers to
make medical necessity determinations consistent with medical and scien-
tific evidence.
 
SUMMARY OF PROVISIONS:
Section 1 amends insurance law to ban reversals of determinations of
medical necessity in the absence of fraud.
Section 2 defines mental health and substance use disorders in insurance
law.
Section 3 amends insurance law to require medical necessity determi-
nations to be made consistent with medical and scientific evidence.
Section 4 defines medical necessity in insurance law.
Section 5 amends insurance law in relation to out-of-network referral
denials.
Section 6 amends insurance law to include mental health and substance
use disorder services in the area of emergency services.
Section 7 outlines the role of a utilization review agent.
Section 8 amends public health law to include mental health and
substance use disorders in law related to emergency services.
Section 9 sets the effective date.
 
JUSTIFICATION:
When utilization review agents make medical necessity determinations
that are inconsistent with medical and scientific evidence, enrollees
are frequently unable to access critically needed services, including
for mental health and substance use disorders.
In New York, health plans must already determine the appropriate level
of care for substance use disorders using a single tool, LOCADTR, which
was developed by the Office of Addiction Services and Supports. Howev-
er, there is no such requirement for other mental health conditions.
Instead, inconsistent, opaque, and non-validated clinical review crite-
ria are frequently used, hindering system-wide efforts to align around a
single set of high-quality criteria to improve health care quality and
access.
Additionally, providers have experienced aggressive post-service audits
by health plans that claw back significant payments for previously
approved care. Such practices have driven mental health and substance
use disorder providers out of insurer networks, leaving enrollees unable
to find in-network care.
The legislation amends New York's Insurance and Public Health laws to
increase access to appropriate care by requiring health insurers to make
medical necessity determinations consistent with medical and scientific
evidence, using transparent clinical review criteria. For mental health
conditions, it allows the Office of Mental Health to designate specific
level of care criteria.
Further, the legislation prohibits insurers from reversing or altering a
determination of medical necessity previously made by the utilization
review agent, except in cases of fraud.
Legislation requiring health plans to use fair standards for coverage
determinations will increase access to medically necessary services as
promised in plan policies, preventing inappropriate denials of needed
mental health and substance use disorder care.
 
PRIOR LEGISLATIVE HISTORY:
New bill
 
FISCAL IMPLICATIONS:
TBD
 
EFFECTIVE DATE:
This act shall take effect immediately

Statutes affected:
S5241: 4900 insurance law, 4900(g-5) insurance law, 4903 insurance law