RETRIEVE BILL
STATE OF NEW YORK
________________________________________________________________________
5733
2003-2004 Regular Sessions
IN ASSEMBLY
March 3, 2003
___________
Introduced by M. of A. GOTTFRIED, GRANNIS, STRINGER, SCARBOROUGH,
JACOBS, SMITH, POWELL, EDDINGTON, KOON, GREEN, HEASTIE, GALEF, SEDDIO,
O'DONNELL -- Multi-Sponsored by -- M. of A. BING, BRADLEY, BRENNAN,
CARROZZA, CHRISTENSEN, CLARK, A. COHEN, M. COHEN, COLTON, COOK,
CYMBROWITZ, DESTITO, R. DIAZ, DiNAPOLI, DINOWITZ, ENGLEBRIGHT, GIANAR-
IS, GLICK, GREENE, GRODENCHIK, GROMACK, HIGGINS, HIKIND, HOOPER, HOYT,
JOHN, KAUFMAN, LAFAYETTE, LAVELLE, LIFTON, LOPEZ, MAGNARELLI, MARKEY,
MAYERSOHN, McENENY, McLAUGHLIN, MILLMAN, ORTIZ, PAULIN, PERRY, PHEF-
FER, SANDERS, SIDIKMAN, SWEENEY, TITUS, TOCCI, TONKO, TOWNS, WEINSTEIN
-- read once and referred to the Committee on Judiciary
AN ACT to amend the general obligations law, the civil practice law and
rules and the public health law, in relation to holding health care
organizations accountable for the consequences of their decisions
The People of the State of New York, represented in Senate and Assem-
bly, do enact as follows:
1 Section 1. Legislative findings. The legislature finds that a wide
2 variety of entities are integrating the functions of paying for health
3 care, determining what health care is paid for, and providing the care.
4 This integration of functions is breaking down traditional distinctions.
5 Increasingly, payor determinations are governing health care and
6 controlling decisions that in the past were the exclusive domain of
7 health care professionals and patients. The legislature further finds
8 that this integration of functions makes it imperative that health care
9 organizations be held fully responsible for the consequences of their
10 decisions, much as health care professionals have been held accountable
11 for the consequences of their decisions.
12 § 2. The general obligations law is amended by adding two new sections
13 11-108 and 11-109 to read as follows:
14 § 11-108. Accountability of health care organizations. 1. Defi-
15 nitions. For purposes of this section and section 11-109 of this title,
16 unless the context clearly requires otherwise:
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD01677-02-3
A. 5733 2
1 (a) "Health care organization" means an entity (other than a health
2 care provider) that approves, provides, arranges for, or pays for health
3 care services, including but not limited to:
4 (i) a health maintenance organization licensed pursuant to article
5 forty-three of the insurance law or certified pursuant to article
6 forty-four of the public health law,
7 (ii) any other organization certified pursuant to article forty-four
8 of the public health law, or
9 (iii) an insurer or corporation subject to the insurance law.
10 No entity or person shall be deemed to be a health care organization
11 because the entity or person procures or pays for health coverage
12 through an entity acting under the insurance law or article forty-four
13 of the public health law.
14 (b) "Health care provider" means an entity licensed or certified under
15 article twenty-eight or thirty-six of the public health law, a preferred
16 provider organization, a participating entity through which a health
17 maintenance organization offers health services under article forty-four
18 of the public health law, an entity licensed or certified under article
19 sixteen, thirty-one or thirty-two of the mental hygiene law, a health
20 care practitioner licensed, registered or certified under title eight of
21 the education law, or a provider of pharmaceutical products or services
22 or durable medical equipment.
23 (c) "Health care service" means health care services, treatments,
24 products or equipment provided by a health care provider.
25 2. (a) Whenever a health care organization delays, fails or refuses to
26 approve, provide, arrange for, or pay for, in a timely manner, any
27 health care service to a person to the extent it is contractually or
28 legally obligated to do so, it shall be liable for any personal injury,
29 death or damages caused by the delay, failure or refusal.
30 (b) A health care organization shall be liable under this section,
31 under otherwise applicable rules of tort and contract liability, includ-
32 ing but not limited to rules relating to agency, vicarious liability,
33 and joint and several liability, for any act by an agent, contractor,
34 participating entity, or health care provider, for which the health care
35 organization would be liable if it were committed by the health care
36 organization.
37 3. The failure of the person (or of any other person acting on the
38 person's behalf) to seek an alternative provider of or to pay for the
39 health care service shall not diminish the health care organization's
40 liability or constitute culpable conduct for the purposes of section
41 fourteen hundred eleven of the civil practice law and rules.
42 4. Nothing in this section shall limit any other right, remedy or
43 cause of action that any person may otherwise have.
44 5. No contract or agreement between a health care organization and a
45 health care provider shall:
46 (a) directly or indirectly require a health care provider to indemnify
47 or hold harmless the health care organization for any liability result-
48 ing from the health care organization's acts or omissions; or
49 (b) waive, limit, or delegate the liability of the health care organ-
50 ization under this section to any health care provider.
51 6. No contract or agreement between a health care organization and any
52 person shall waive or limit any liability of the health care organiza-
53 tion under this section to the person.
54 7. If the time in which a plaintiff could have commenced an action for
55 professional malpractice for the act, error or omission complained of
56 has expired prior to the commencement of an action brought pursuant to
A. 5733 3
1 this section against a health care organization, the defendant in said
2 action shall be barred from commencing a third-party action against a
3 person not a party who is or may be liable to that defendant for all or
4 part of the plaintiff's claim against the defendant and against whom the
5 plaintiff cannot commence an action for professional malpractice due to
6 the expiration of the statute of limitations prior to the commencement
7 of the action against the defendant.
8 8. A health care organization shall exercise reasonable care: (a)
9 when making decisions which affect the health care service of an enrol-
10 lee; and (b) in selecting and exercising influence or control over its
11 employees, agents, ostensible agents, or representatives who are acting
12 on its behalf, respecting decisions which may affect the quality of the
13 health care service provided to its enrollees.
14 9. This section shall not be construed to diminish any contractual or
15 legal obligation of the health care organization, nor to create an obli-
16 gation on the part of the health care organization to provide any health
17 care service to an enrollee that is not a covered benefit.
18 § 11-109. Protection of health care providers. 1. No health care
19 organization or health care provider shall, by contract, policy or
20 procedure:
21 (a) prohibit or restrict any health care provider from filing a
22 complaint;
23 (b) prohibit or restrict any health care provider from making a report
24 or commenting to the appropriate government agency regarding the poli-
25 cies or practices of the organization which may negatively affect the
26 quality of or access to health care services; or
27 (c) prohibit or restrict any health care provider from disclosing or
28 commenting on policies or practices of the organization which may nega-
29 tively affect the quality of or access to health care services to the
30 public.
31 This subdivision shall not be construed to permit a health care
32 provider to disclose any information regarding a patient which would
33 otherwise be deemed confidential or privileged, or which should not be
34 disclosed or discussed according to law or reasonable professional stan-
35 dards.
36 2. No health care organization or health care provider shall terminate
37 a contract or employment of a health care provider, or refuse to renew
38 such a contract, or penalize a health care provider or reduce or limit
39 the compensation of a health care provider solely because a health care
40 provider has:
41 (a) advocated for, recommended or provided a particular health care
42 service to a patient, to which the patient was entitled by contract or
43 law;
44 (b) taken any action under subdivision one of this section;
45 (c) appealed or assisted in appealing a decision of the health care
46 organization; or
47 (d) requested a hearing or review to which the provider was entitled.
48 3. No health care organization or health care provider shall apply any
49 incentive, whether monetary or otherwise, to a health care provider
50 intended or having the effect of inducing the health care provider to
51 delay, fail or refuse to provide any health care service to which a
52 patient is entitled by contract or law.
53 § 3. Section 1602 of the civil practice law and rules is amended by
54 adding a new subdivision 13 to read as follows:
55 13. not apply to an action against a health care organization brought
56 pursuant to section 11-108 of the general obligations law.
A. 5733 4
1 § 4. Subdivision 1 of section 4410 of the public health law, as added
2 by chapter 938 of the laws of 1976, is amended to read as follows:
3 1. The provision of comprehensive health services directly or indi-
4 rectly, by a health maintenance organization through its comprehensive
5 health services plan shall not be considered the practice of the profes-
6 sion of medicine by such organization or plan. [However, each] Except
7 that:
8 (a) This subdivision shall not be construed to limit any liability the
9 health maintenance organization or its comprehensive health services
10 plan would otherwise have relating to any professional services rendered
11 by, on behalf of, or in connection with the organization or plan.
12 (b) Each member, employee or agent of such organization or plan shall
13 be fully and personally liable and accountable for any negligent or
14 wrongful act or misconduct committed by him or her or any person under
15 his or her direct supervision and control while rendering professional
16 services on behalf of [such] the organization or plan.
17 (c) No contract or agreement between a health maintenance organization
18 or its comprehensive health services plan and any health care provider
19 shall delegate the liability of the health maintenance organization to
20 any health care provider or shall require the health care provider to
21 indemnify or hold harmless the organization or plan for any liability
22 the organization or plan may incur.
23 § 5. If any provision of this act or the application thereof shall be
24 held to be invalid, such invalidity shall not affect other provisions or
25 other applications of any provision of this act which can be given
26 effect without the invalid provision or application, and to that end,
27 the provisions and application of this act are severable.
28 § 6. This act shall take effect immediately.