State Budget Outcome: Parity Compliance

April 1, 2020

NYS Council members,

As you know implementation of a new Behavioral Health Parity Compliance Fund was a high priority for the NYS Council throughout the budget negotiations process. The final Transportation, Economic Development and Environmental Conservation budget bill is working its way through passage in both houses.

Below is Part QQQ from the bill related to behavioral health parity.

The provision creates MH/SUD compliance fund for penalties collected from insurer violations to be deposited into a fund under the Comptroller and Tax Department, known as the Behavioral Health Parity Compliance Fund.  Monies shall only be used for initiatives supporting parity implementation and enforcement including the behavioral health ombudsman program.

Further, DOH and DFS shall develop regulations which establish standards and criteria for compliance programs for public or governmentally-sponsored or supported insurance plans. This is an important step towards requiring health plans and the state to do more self-monitoring and compliance reporting regarding compliance with federal and state parity laws.

PART QQQ, pages 132-133

22 Section 1. The insurance law is amended by adding a new section 344 to

23 read as follows:

24 § 344. Mental health and substance use disorder parity compliance

25 programs. Penalties collected for violations of section three thousand

26 two hundred sixteen, three thousand two hundred twenty-one and four

27 thousand three hundred three of this chapter related to mental health

28 and substance use disorder parity compliance shall be deposited in a

29 fund established pursuant to section ninety-nine-hh of the state finance

30 law.

31 § 2. The state finance law is amended by adding a new section 99-hh to

32 read as follows:

33 § 99-hh. Behavioral health parity compliance fund. 1. There is hereby

34 established in the custody of the state comptroller and the department

35 of taxation and finance a special fund to be known as the behavioral

36 health parity compliance fund.

37 2. Moneys in the behavioral health parity compliance fund shall be

38 kept separate from and shall not be commingled with any other moneys in

39 the custody of the comptroller or the commissioner of taxation and

40 finance. Provided, however that any moneys of the fund not required for

41 immediate use may, at the discretion of the comptroller, in consultation

42 with the director of the budget, be invested by the comptroller in obli-

43 gations of the United States or the state. The proceeds of any such

44 investment shall be retained by the fund as assets to be used for

45 purposes of this fund.

46 3. Such fund shall consist of all moneys required to be deposited

47 thereto pursuant to section three hundred forty-four of the insurance

48 law, section forty-four hundred fourteen of the public health law or any

49 other provision of law, monetary grants, gifts or bequests received by

50 the state, and all other moneys credited or transferred thereto from any

51 other fund or source.

52 4. Moneys of the fund shall only be expended for initiatives support-

53 ing parity implementation and enforcement on behalf of consumers,

54 including the behavioral health ombudsman program.

1 § 3. Section 4414 of the public health law, as added by chapter 2 of

2 the laws of 1998, and as further amended by section 104 of part A of

3 chapter 62 of the laws of 2011, is amended to read as follows:

4 § 4414. Health care compliance programs. 1. The commissioner [of

5 health], after consultation with the superintendent of financial

6 services, shall by regulation establish standards and criteria for

7 compliance programs to be implemented by persons providing coverage or

8 coverage and service pursuant to any public or governmentally-sponsored

9 or supported plan for health care coverage or services. Such regulations

10 shall include provisions for the design and implementation of programs

11 or processes to prevent, detect and address instances of fraud and

12 abuse. Such regulations shall take into account the nature of the enti-

13 ty’s business and the size of its enrolled population. The commissioner

14 [of health] and the superintendent of financial services shall accept

15 programs and processes implemented pursuant to section four hundred nine

16 of the insurance law as satisfying the obligations of this section and

17 the regulations promulgated thereunder when such programs and processes

18 incorporate the objectives contemplated by this section.

19 2. Notwithstanding any provisions of section twelve of this chapter to

20 the contrary, penalties collected from any health maintenance organiza-

21 tion certified pursuant to this article resulting from a violation of

22 the health maintenance organization’s mental health and substance use

23 disorder parity compliance program shall be deposited into the behav-

24 ioral health parity compliance fund as established pursuant to section

25 ninety-nine-hh of the state finance law.

26 § 4. This act shall take effect immediately and shall be deemed to

27 have been in full force and effect on and after April 1, 2020.