2014-15 Executive Budget Update

April 2, 2014
By Richard Gallo and Jamie Papapetros

The Senate and Assembly passed the budget bills comprising the $138 billion budget Monday and the Governor has signed them into law. NYSPA is proud to report that it achieved many favorable outcomes, including the defeat of efforts to eliminate prescriber prevails in Medicaid, prior authorization requirements for off-label prescribing in Medicaid, as well as a proposal to allow for the establishment of retail clinics (without a statutory exclusion for providing mental health services), while also securing an additional $450,000 in funding for the Veterans’ Mental Health Primary Care Training Initiative, conducted by NYSPA, MSSNY and the National Association of Social Workers – NYS, and major out-of-network insurance reforms.

Below is a summary of budget actions on issues of interest to NYSPA and psychiatrists:

1. NYSPA/MSSNY Veterans’ Mental Health Primary Care Training Initiative – We are pleased to report that the Legislature appropriated an additional $150,000 to NYSPA for our Veterans Mental Health –Primary Care Initiative bringing the total amount of state funding for NYSPA for the fiscal year beginning on April 1, 2014 to $315,000. The Legislature also appropriated an additional $150,000 each to MSSNY and NASW-NYS. (NYSPA’s Position: Requested that the Legislature add the $450,000 in support of the NYSPA, MSSNY, NASW-NYS Veterans’ Mental Health Training Initiatives, as it was not included in the Governor’s Budget Request.)  

2. Prescriber Prevails in Medicaid Fee-for-Service and Medicaid Managed Care – Final budget does not include Executive budget proposal to eliminate prescriber prevails in Medicaid Fee-for-Service and Medicaid managed care programs for drugs that have Federal Drug Administration (FDA)-A rated generic equivalents.  (NYSPA Position: Supported and worked to accomplish this outcome)  

3. Off-Label Prescribing in Medicaid – Final budget does not include Executive budget proposal to require verification (through prior authorization) of FDA and/or compendia supported uses in order for reimbursement for certain drugs where there is evidence of prescribing for a non-medically indicated, or “off-label,” use. (NYSPA Position: Supported and worked to accomplish this outcome)   

4. Limited Services Clinics (i.e. retail clinics) – Final budget does not include Executive budget proposal to provide for the establishment of retail clinics operated by for profit corporations, including publically traded corporations. In addition, proposals regarding urgent care centers, ffice-based surgery and office-based anesthesia were not adopted.  (NYSPA Position: Supported and worked to accomplish this outcome)  

5. Private Equity Demonstration Program – The final budget does not include language authorizing up to five business corporations, except for publicly traded entities, to participate in a private equity demonstration program to authorize capital investment in health care projects. (NYSPA Position: None taken)

6. Physician Excess Medical Malpractice Program – Program was extended for one year and funded at its historic level of $127.4 million. (NYSPA Position: Supported this outcome)

7. Nurse Practitioner Practice – Led by MSSNY, the physician community, including NYSPA, was able to curtail the authority for nurse practitioners to practice independently. Here is a brief summary:

  • For nurse practitioners in practice for less than 3,600 hours, the current law – requiring a written practice agreement and protocols with a collaborating physician of the same specialty – remains unchanged.
  • For nurse practitioners in practice for more than 3,600 hours, a written practice agreement and protocols is not required; however, these nurse practitioners would have to maintain a documented “collaborative relationship” with one or more physicians of the same specialty or a hospital licensed under Article 28 of the Public Health Law. As evidence of maintaining a collaborative relationship, nurse practitioners will have to complete and maintain a form approved by the State Education Department. The budget language defines collaborative relationships:

 “… shall mean that the nurse practitioner shall communicate, whether in person, by telephone or through written (including  electronic) means, with a licensed physician qualified to collaborate in the specialty involved  or,  in  the  case  of  a hospital, communicate with a licensed physician qualified to collaborate in  the  specialty  involved and having privileges at such hospital, for the purposes of exchanging information, as needed, in order  to  provide comprehensive patient care and to make referrals as necessary.”

  • Regarding the form nurse practitioners in practice for more than 3,600 hours would have to maintain, the budget states, “Such form shall also  reflect  the  nurse  practitioner's acknowledgement that if reasonable efforts to resolve  any  dispute  that  may  arise  with  the collaborating physician or, in the case of a collaboration with a hospital, with a licensed physician qualified to collaborate in the specialty involved  and having privileges at such hospital, about a patient's care are not successful, the recommendation of the physician  shall  prevail.”
  • NOTE: The final budget rejected the Governor’s proposal authorizing nurse practitioners with more than 3,600 hours to collaborate with other nurse practitioners, under certain circumstances.
  •  This will take effect January 1, 2015 and will sunset on June 30, 2021. 
    (NYSPA’s Position:Opposed to independent practice)

8. Out-of-network reforms – The final budget includes a number of out-of-network insurance reforms aimed at protecting consumers from bills for emergency care services as well as surprise bills as well as requiring greater disclosure from insurers regarding methodology used for reimbursing out of network healthcare services, as follows (NYSPA Position: Supported reforms):

  • Require insurers to describe their out-of-network coverage as a percentage of the usual and customary cost and defines “usual and customary cost” as the 80th percentile of “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 specified by the superintendent.” This appears to refer to FAIR Health. Along these lines, it is important to note that a proposal to sunset the definition of usual and customary cost was not included in the final budget.
  • Require insurers to make available a policy that covers at least 80% of the usual and customary cost if the insurer issues “a comprehensive group or group remittance health insurance policy or contract that covers out-of-network health care services.” NOTE – This goes even further than what the Executive proposed, which was 70 percent of usual and customary. 
  • Require all health insurance to maintain adequate networks and afford individuals enrolled in all health products to receive treatment from a specialist who is qualified to treat a patient’s particular condition if the insurer’s network does not include an appropriately qualified specialist. In addition, individuals will now have an external appeal right. 
  • Establishes an independent dispute resolution process to resolve bills for emergency care and surprise bills through which insurers or physicians can bring a claim to resolve a payment dispute. An important note here is that a physician of the same or similar specialty as the physician providing treatment would be involved in reviewing the fee of the physician. The independent dispute resolution process would have to consider: 
    • Whether there is a "gross disparity" between the fee charged by the physician as compared to what they usually charge in other non-participating situations;  
    • Whether there is a "gross disparity" between the fee charged by the physician as compared to other fees paid to similarly qualified non-participating physicians in the same region;
    • The non-participating physician's usual charge for comparable services;
    • individual patient characteristics;
    • the level of training, education and experience of the physician;
    • the circumstances and complexity of the case, including the time and place of the services; and
    • the usual and customary cost of the service.
  • An out-of-network reimbursement work group, consisting of nine members appointed by the Governor to prepare a report with recommendations for an alternative rate methodology by January 1, 2016. The nine members of the work group, co-chaired by the Commissioner of Health and the Superintendent of the Department of Financial Services, would include two physicians, two representatives of health plans, and three consumers.
  • The new law is effective one year after it is signed into law and shall apply to policies renewed on and after that date. The new disclosure requirements will go into effect one year after enactment.
  • In addition, two other sections of the out of network reform bill language are of interest:
*  “Claim forms.  A non-participating physician shall include a claim form for a third-party payor with a patient bill for health care services, other than a bill for the patient's co-payment, coinsurance or deductible.”
*  “Disclosure.  1. A health care professional, or a group  practice of  health  care  professionals,  a diagnostic and treatment center or a  health center defined under 42 U.S.C. § 254b on behalf  of  health  care  professionals  rendering  services at the group practice, diagnostic and  treatment center  or  health  center,  shall  disclose  to  patients  or prospective  patients  in  writing  or  through  an internet website the health care plans in which the health care professional, group practice,  diagnostic and treatment center or health  center,  is  a  participating  provider  and  the  hospitals with which the health care professional is affiliated prior to the provision of non-emergency services and verbally at the time an appointment is scheduled.”

9. Crisis Intervention Teams – The budget appropriates $400,000 for crisis intervention teams that will provide law enforcement officers with comprehensive training in responding to individuals in mental distress or crisis. NYSPA supported this addition, which will assist law enforcement in de-escalating situations involving individuals in emotional distress and avoid excessive use of force and incarcerations. (NYSPA Position: Supported and worked to accomplish this outcome)  


10.
Professional Licensure (Outstanding Tax-Liabilities) – Final budget does not include Executive budget proposal for the establishment of a new program to prevent applicants from receiving or renewing professional or business licenses if they owe certain past-due tax liabilities. (NYSPA Position: None taken)

11. Medical Marijuana – Not addressed in the final budget.  (NYSPA Position: None taken)

12. $25 million pre-investment for community-based services – As NYSPA advocated along with its mental health coalition partners, the budget appropriates $25 million “For services and expenses associated with reinvestment for the expansion of state community hubs and voluntary operated services for adults and children.” (NYSPA Position: Supported)

13. The budget also extends the Mental Health Support and Workforce Reinvestment Act for three years to correspond with the time frame of the Regional Centers of Excellence Plan and increases the amount of per-bed reinvestment from $70,000 to $110,000.  (NYSPA Position: None taken)

14. Medicaid Managed Care Advisory Review Panel Expanded – Budget expands the panel from twelve to sixteen members. Specifically the budget states, “The panel shall include a consumer representative for individuals with behavioral  health  needs,  a consumer representative for individuals who are dually eligible for Medicare and Medicaid, a representative of entities that provide  or  arrange for the provision of services to individuals with behavioral health needs, and  a representative of entities that provide or arrange for the provision of services to individuals who are dually eligible for Medicare and Medicaid.” (NYSPA Position: None taken)

15. COLA - A two percent cost-of-living increase for direct care and direct care support staff of the Office of Mental Health, Office for Persons with Developmental Disabilities, Office of Alcohol and Substance Abuse Services, Office of Children and Family Services, Department of Health and State Office for the Agingeffective January 1, 2015.  (NYSPA Position: Supported)

16. Raise the Age – Final budget includes funding for the previously announced Governor’s Commission on raising the age of criminal responsibility. (NYSPA Position: Supported)