June 12, 2025
I spoke to a Crain’s reporter yesterday about our ongoing concerns over health plan non-compliance with the new commercial rate mandate. I explained the issue and I provided backup for my claims that many plans are not paying the new rates, and they are using delay tactics that appear to be ok with state regulators despite the fact that the law was effective January 1, 2025.
The article came out this morning and while I’m not happy with it (in my opinion it simply provides a platform for health plans and state regulators to air out their numerous excuses without any pushback) it does elevate the problem for all to see.
It should be noted that MetroPlus was completely non-responsive to the issue at hand (see quote below), responding with information about provider readiness rather than admitting the insurer has yet to pay the correct rates and apparently won’t be ready to do so until August. And Eric Linzer (head of the Health Plan Association) is absolutely incorrect when he says the state never provided plans with specific rate information. The opposite is true – the state provided excruciatingly detailed rate information for every conceivable rate code combination to the health plans on November 22 last year. It’s publicly available on OMHs website and has been since last year.
To this point, insurers have been getting away with noncompliance without a bright light shining down on them, let alone robust enforcement. What I need going forward is agency representatives willing to speak to reporters (either on background or for the record, preferably the latter) about what’s happening here and the many negative consequences this situation continues to have on access to care and provider viability.
Please consider my request for assistance.
Here’s the article from CHP this morning:
Mental health providers still waiting for pay bump six months after new law
New York enacted a law this year to raise how much health insurers pay for behavioral health services, an attempt to funnel resources into the state’s overburdened system. But six months since the law went into effect, some providers are still waiting to get paid.
Gov. Kathy Hochul passed a law in last year’s budget requiring commercial health insurers to pay at least as much as Medicaid pays for outpatient behavioral health services such as opioid treatment or day rehab care, rectifying a rare instance when government plans have historically been more lucrative for providers. The law was designed to help mental health and substance use agencies accept more patients with private insurance and address months-long wait times that have restricted access to care.
The state’s insurance mandate went into effect on Jan. 1, but implementation of the law is spotty; some insurance companies have delayed reimbursement increases due to technology challenges and what they say was a short timeline to update their systems to process new claims, while providers receive the old payment rates.
Insurers have pledged to pay the correct rates to providers retroactively later this year once their systems are up and running. But the delay still places undue burden on mental health and substance use agencies that are already pressed for cash and have to devote administrative resources to ensure they are made whole, said Lauri Cole, executive director of the New York State Council of Community Behavioral Healthcare, an industry group that represents providers.
“That is a resource-intensive nightmare for providers and their back-office staff who are pulling their hair out,” Cole said.
Some plans have sent notices to providers to explain why payments have yet to increase. Highmark, a health plan that serves patients in western and northeastern New York, said in a May 30 email to providers reviewed by Crain’sthat it planned to publish new payment rates by the end of July and update its billing system by the end of October.
Additionally, MetroPlus Health, an insurance plan that’s a part of New York City Health + Hospitals, sent a note to providers on May 29 stating that the new rates would go live on Aug. 11.
Representatives from Highmark and MetroPlus Health said that they intend to fully comply with the commercial rate mandate and will pay providers retroactively.
“Like other health plans across New York State, we are working diligently to build a new reimbursement platform that aligns with Medicaid billing processes, which are complex and different than current payments for our commercial members,” a spokesperson from Highmark said.
Michelle Dominguez, a spokeswoman for MetroPlus Health, said that 99% of the insurer’s behavioral health providers are ready to be paid under the commercial rate mandate, and a memo issued to providers earlier in May went to less than 1% of providers who required additional administrative updates.
Health plans are in various stages of implementing the mandate, as the state only provided guidance on its new policy a few months before the Jan. 1 effective date, according to Eric Linzer, president and CEO of the insurance lobbying group New York Health Plan Association. Linzer said the insurance industry did not oppose the mandate and has been working to comply with the requirements, but state officials did not provide enough time for health plans to prepare.
“These are significant changes that take time for plans to program their systems and do claims testing,” Linzer said. “It’s a great deal of complexity.”
Linzer added that the state has not provided a fee schedule outlining the specific rates insurers must pay for services, a factor that has added to insurers’ confusion and payment delays, he said. State lawmakers have introduced a bill to require the Office of Mental Health and the Office of Addiction Services and Supports to publish fee schedules to help providers figure out how much to pay. The bill has passed in the Assembly.
A spokesperson from the Department of Financial Services, which regulates private insurance companies, said that the agency has been made aware of technical issues that some insurers have faced, which have delayed higher payments. The agency has been meeting regularly with insurers to ensure providers will be made whole, the spokesperson said.