A.7704 – Relates to Behavioral Health Parity

Re: A.7704 (Fernandez) — AN ACT to amend the insurance law, in relation to providing behavioral health parity (Part A); and to amend the insurance law, in relation to the authorization for certain drugs for the detoxification or maintenance of a substance use disorder (Part B)

This legislation, A.7704, would prohibit pre authorization or concurrent reviews for inpatient psychiatric hospital services for 14 days, creates a private right of action for consumers to sue insurance companies for damages caused by parity law violations, and prohibits insurers from requiring prior authorization for maintenance prescriptions of medication assistant treatment drugs for use in combating substance use disorder.  The New York Health Plan Association opposes this legislation.

First, the bill prohibits insurers from requiring pre authorization or concurrent reviews for the first fourteen days of an inpatient hospital stay for substance use disorder treatments.   Over the past several years, New York has taken a number of steps to address the opioid and substance use disorder (SUD) epidemic, including legislation to increase access to treatment and broaden coverage of treatment options, and oversight of parity compliance.  Plans believe that this treatment should begin in the least restrictive setting, graduating up to inpatient stays where necessary and appropriate.  Rather than mandating a specific number of days for inpatient treatment without consultation with the insurer, the state should focus on adopting standards for coordinated care management across the delivery system. The state should require providers to communicate with the plan throughout the inpatient stay and begin to engage in a discharge planning process with the plan well in advance of the member’s discharge from the facility – to ensure that the member receives the most appropriate next level of treatment immediately upon discharge from inpatient treatment. In addition, despite the steps New York has taken to set rules for what services must be covered, there remains a lack of outcome measures to evaluate the effectiveness of the treatment being provided and whether providers and facilities are following evidence-based standards. The state should put in place systems to publicly report on provider outcomes to ensure quality of care being provided and that the full range of evidence-based treatment options are available to individuals throughout the continuum of their care. Plans must be involved from the beginning of the hospitalization to ensure that patients receive the most appropriate care across the continuum.

This legislation also creates new legal rights under which individuals may seek damages, and increases the level of damages that an individual may seek. Measures already exist to address prohibited and unlawful business practices and expanding the ability to sue would lead to higher health care costs in response to the threat of litigation brought against health plans.

Health plans today are held accountable for compliance with a wide range of state and federal laws that protect consumers, including standards related to internal and external appeals, quality assurance programs, utilization management activities, and the payment of claims. The state already has the authority to enforce these requirements through a number of means including civil monetary penalties and revocation of licensure for violations of state or federal requirements. Similarly, health plans that fail to live up to their contractual obligations for benefits coverage may be subject to civil lawsuits for breach of contract. The only party to win under A.7704, will be trial attorneys, eager to see expanded liability.  Expanding the right to sue by allowing statutory damages for parity violations of up to $1,000 with the potential for the court to award $5,000 in additional damages at their discretion is completely unnecessary and dangerous to the solvency of carriers and the affordability of health insurance.  Further, at a time when the cost of care is rising, we should spend our limited health care dollars on patient care, not trial attorneys.

Finally, A.7704 prohibits prior authorization for patients to access maintenance prescriptions of medication assisted treatment drugs to treat substance use disorders.  While we recognize the devastating impact of the opioid crisis and are actively engaged partners on the forefront of treating the opioid epidemic, we have concerns about the elimination of prior authorization for all forms of medication assisted treatment drugs.

Prior authorization is an important tool to protect patients from unnecessary and potentially harmful care.  For example, it is utilized to help ensure that medications are safe, effective, and provide value for specific populations or subpopulations who may be affected differently by a medication, and to make sure that a medication is not co-prescribed with another medication that could have dangerous interactions. HPA is concerned that eliminating prior authorization for these drugs will inhibits plans’ ability to coordinate care and treatment plans for members.  Treatment for SUD goes far beyond just taking medication, and prior authorization is one of the tools plans use to help streamline and manage patient care.

This legislation adds on to an otherwise comprehensive state regulatory scheme that already exists and will drive up health care costs for employers and consumers at a time when the focus should be directed on measures to better coordinate care and make health care more affordable. For all these reasons, we urge you to oppose A.7704.