A.9539/S.8957 – Rare Diseases Coverage Mandate

This legislation, A.9539/S.8957, would require health plans to provide insurance coverage in certain instances for rare diseases, life-threatening conditions or diseases, degenerative and disabling conditions or diagnoses involving medically fragile children, and require coverage by out of network providers. This bill is unnecessary as statutory protections already exist to ensure that patients can access the care they need. Moreover, it will increase the costs of coverage for individuals and employers. Accordingly, the New York Health Plan Association (HPA) opposes the bill.

Health plans are committed to high quality care for every patient and take seriously the unique needs of medically fragile children. This includes working with doctors and other providers to ensure that proposed medical procedures, services or treatments are safe and effective for that particular patient based on the best available clinical evidence, are administered or provided in the appropriate care setting by a qualified, licensed provider and are provided with other support services that may be needed. In making medical necessity decisions, health plans already must abide by stringent state requirements that their medical necessity guidelines and criteria are evidence-based.

However, A.9539/S.8957 undermines the ability of health plans to evaluate the clinical appropriateness of health care services and direct patients to qualified providers. Plans would be required to cede the medical determination process when a patient’s treating specialist or primary care provider provides a written recommendation of a chosen provider for the particular disease – regardless if that provider is outside the plan’s network.

Health care networks are the foundation of health plans. Providing coverage through a network increases quality, enhances medical competency, and encourages greater coordination and collaboration by providers. In developing their networks, health plans also make sure they have the variety of primary care doctors, specialists, hospitals, and other providers that consumers need and can access in a variety of locations. The purpose of New York’s out-of-network law – one of the strongest in the nation – is to ensure patients can access providers when their plan’s network does not have a qualified in-network provider. Allowing a patient’s treating specialist or primary care provider to bypass the plan’s network will certainly encourage greater use of out-of-network services.

Additionally, although the legislation also states that patients be allowed to access an out-of-network providers so long as “the costs of the chosen provider are equal to or less than the average cost that would have otherwise been paid to a local network provider who possesses a similar subspecialty as such chosen provider,” there is no requirement that the provider accept an in-network reimbursement. The result of this will be higher costs for the consumer and increase the underlying cost of health care in New York.

Consumers who elect to seek services from non-participating providers are responsible for paying the difference between what the non-participating provider charges and the amount the health plan reimburses the provider for these services. Increasing the use of out-of-network providers will also drive up health plans’ provider costs, one of the key drivers of rising health care costs. Increasing the underlying cost of health care ultimately drives up health insurance premiums.

Affordability of health insurance remains a key concern for employers and consumers. Instead of considering legislation that will increase costs, we encourage lawmakers remain focused on making health care more affordable for all New Yorkers.

For these reasons, HPA opposes A.9539/S.8957.