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State Budget Provisions Affecting Health Plans

April 05, 2019

The recently passed New York State 2019-20 budget includes a number of provisions that affect health plans and the coverage they offer to employers and consumers. 

Below is a summary of key items:

Mandated Benefits

In-Vitro Fertilization (IVF) and Fertility Preservation Services 

  • Requires large group policies to cover three cycles of IVF 
  • Expands current infertility treatments law to include coverage for fertility preservation for cancer patients in the individual, small group and large group markets.
  • Effective for policies issued, renewed or modified as of 1/1/20

Expansion of Inpatient Substance Use Disorder Treatment 

  • Expands inpatient treatment mandate for substance use disorders from 14 to 28 days
  • Requires periodic consultation with health plans prior to day 14 of treatment and includes HPA recommendation that providers provide a written discharge plan with the patient and health plan
  • Prohibits prior authorization for Medication Assisted Treatment (MAT)
  • Allows OMH to review and approve plan utilization review criteria
  • Imposes an assessment of $1.7M on health plans to fund oversight of parity compliance

Restrictions on Medicaid plan/Pharmacy Benefit Manager (PBM) Contracting 

  • Places restrictions on contracting arrangements between Medicaid health plans and PBMs, including imposing additional disclosure and contracting restrictions around PBM administrative fees and new reporting requirements on health plans
  • $86 million in Medicaid savings

Affordable Care Act (ACA) Codification

  • Language to codify the Guarantee Issue, Pre-Existing Conditions, and Essential Health Benefits provisions of the federal ACA in state law
  • Proposed provisions that went beyond the ACA were not included

Cuts to the Medicaid Managed Care Quality Pool

  • Cut to the Quality Pool believed to be at $30 million total ($70 million proposed)

Expanded Office of Medicaid Inspector General (OMIG) Authority

  • Authorizes OMIG to review plans’ compliance with contractual program integrity requirements and penalize health plans for up to 2% of the administrative component of the premium if OMIG finds a plan out of compliance
  • Where the state is “unsuccessful” in recovering improper payments from subcontractors or providers, OMIG may require the plan to recover the payment

Universal Access Commission

  • A Commission to evaluate pathways for achieving universal access to high quality, affordable health care in New York, and charges the commission to report options to the Governor by December 1, 2019 was not included in the budget

Many of the proposed items that were not included in the final budget may be reconsidered during the remainder of the Legislative Session which continues until late June. 

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