If signed into law by Governor Cuomo, New York’s parity reporting bill (A.3694-C/S.1156-C) will be among the most comprehensive laws of its kind in the country. The bill was passed by both the New York State Senate and New York State Assembly in the final week of the 2017/2018 Legislative Session, which concluded this past June. The passage of this legislation represents a major step forward in advancing parity compliance by health insurers and health plans.
The bill, called the “Mental Health and Substance Use Disorder Parity Report Act” would amend Section 210 of the Insurance Law, which requires the state to annually publish a Consumer Guide to Health Insurers. The Consumer Guide provides a ranking of insurance companies from best to worst based upon claim processing or medical payments made during the preceding calendar year. The new legislation would require insurers, health plans and behavioral health management companies to submit data to the state and information on parity compliance, including:
- Rates of utilization review for mental health and substance use disorder (MH/SUD) claims and rates of approvals and denials, compared to medical and surgical claims
- Number of prior or concurrent authorization requests for MH/SUD services and number of denials compared to medical and surgical services
- Rates of appeal of adverse determinations for MH/SUD claims including rate of appeals upheld or overturned, compared to similar rates for medical and surgical claims
- Percentage of claims paid for in-network MH/SUD services, compared with the percentage of claims paid for in-network medical and surgical services
- Percentage of claims paid for out-of-network MH/SUD services, compared with the percentage of claims paid for out-of-network medical and surgical services
- The number of behavioral health advocates or staff available to assist policyholders with MH/SUD benefits
- A comparison of cost sharing requirements (co-pays and coinsurance) and benefit limitations (limitations on the scope and duration of coverage)
- Number of providers licensed to practice in New York State that provide MH/SUD treatment and diagnosis who are in-network (by type)
- The percentage of providers of MH/SUD services who remained participating providers
- Any other data or metric the Superintendent deems necessary to measure compliance with MH/SUD parity including (i) adequacy of the company’s in-network MH/SUD provider panels and (ii) reimbursement for in-network and out-of-network MH/SUD services compared to reimbursement for in-network and out-of-network medical and surgical services.
The state will evaluate the data collected to verify compliance with parity laws and publish its findings in a parity report. If the bill is enacted into law, the first such parity report would be published in September 2019.
Background on Parity
New York already has strong parity laws in place. Timothy’s Law, New York’s mental health mandate enacted in 2006, requires all group health plans to provide coverage for a minimum of 20 outpatient visits and 30 inpatient treatment days per year for the treatment of mental illness. Timothy’s Law also provides for unlimited coverage for adults with schizophrenia/psychotic disorders, major depression, bipolar disorder, obsessive-compulsive disorder, delusional disorders, panic disorder, bulimia and anorexia. The federal Paul Wellstone and Pete Domenici Mental Health Parity and Addiction Equity Act of 2008, expanded New York’s 30/20 benefit into a full parity benefit, requiring full coverage of all medically necessary treatment for mental health or substance use disorders.
Despite strong parity laws on the federal and state level, full implementation and enforcement of these laws has yet to be achieved. As evidenced by investigations conducted by the New York State Office of the Attorney General, health insurers and health plans continue to exhibit non-compliance, impeding implementation and inhibiting access to care. To date, the Attorney General’s office has entered into settlement agreements with eight insurers in connection with policies and procedures that violate the parity statutes. As described in the settlement agreements, certain insurers continue to apply more stringent and frequent utilization review standards to MH/SUD benefits than to medical/surgical benefits and to deny care and treatment for MH/SUD benefits at a higher rate than medical/surgical benefits. In addition, insurers continue to apply medically necessary criteria and models inconsistent with applicable law and regulation, resulting in adverse coverage determinations and reduced access to care.
Advocacy Efforts
The original concept of an annual parity evaluation and report was advanced by NYSPA’s Committee on Legislation and further developed in conjunction with representatives from organized psychology and organized social work with an intent to focus in large part on the most common areas of non-compliance identified by the Attorney General’s office. NYSPA leadership engaged Senator Rob Ortt (R-North Tonowanda) and Assemblymember Aileen Gunther (D-Forestburgh), the Chairs of the Senate and Assembly Mental Health Committees, respectively, to sponsor the legislation.
The original version of the reporting bill was introduced at the end of the 2016 legislative session, laying the ground work for further advocacy in the following session. Upon further discussions and consultation, the legislation was amended in 2017 to add requirements for submission of additional data elements. In late May 2018, the bill was further refined to include an evaluation of network adequacy and in-network and out-of-network reimbursement as well as any other metric the Department of Financial Services deems necessary. The legislation was vigorously opposed by health insurers, health plans and behavioral health management companies who argued against increased reporting requirements.
However, as a result of advocacy on the part of mental health provider and consumer groups, on June 18, 2018, the NYS Assembly passed the legislation by a vote of 137-1. Two days later, on June 20th, the NYS Senate passed the bill by a vote of 60-0, in one of its final acts of the Legislative Session. Clearly, there was significant bipartisan support for this significant piece of legislation.
This success would not have been possible without the support of 22 different organizations, including organized psychology, organized social work, the Medical Society of the State of New York, other medical specialty societies and many consumer and provider advocacy organizations. Also essential were the individual grassroots efforts of providers who took the time to call and write their legislators, Senate and Assembly leadership and the bill sponsors in support of the legislation.
NYSPA is very proud to have played an integral part in legislation that will have a significant role in improving parity enforcement and compliance and will positively impact consumers, families and providers across the state. Barry B. Perlman, M.D., longstanding chair of NYSPA’s Committee on Legislation, was quoted in a Psychiatric News article on parity enforcement: “This is clearly one of the most consequential pieces of legislation undertaken by NYSPA, and one that will advance the goal of fully implementing the spirit and intent of the federal and New York’s parity law that we all fought so hard to enact twelve years ago.”
At the time of publication, the bill had not yet been sent to the Governor’s office for consideration. Once it is sent, the Governor will have ten days to either sign or veto the legislation. It is essential that proponents of the bill reach out to the Governor’s office by phone, email or direct mail to express their support and urge him to sign the parity reporting bill into law.
To contact the Governor’s office regarding the legislation, please use the following link: https://www.governor.ny.gov/content/governor-contact-form.
Richard Gallo is the Government Relations Advocate for the New York State Psychiatric Association. Rachel Fernbach, Esq. is Deputy Director and Assistant General Counsel of the New York State Psychiatric Association.
