New York State Health Care Reform Act (HCRA)

February 4, 2000

Dear Payor:

Re: 2000 Public Goods Pool Reporting Forms - Payors

Enclosed please find reporting forms and instructions for electing payors to use when calculating and remitting payments to the Public Goods Pools for reporting periods January 1, 2000 through December 31, 2000. Beginning with the report for the month of January 2000, which must be submitted (postmarked) by March 1, 2000, payors are required to use the enclosed forms. The reporting forms are required to be filed monthly even if there is no activity to report.

If you are a payor (e.g., self-insured fund) represented by a TPA, be advised that we are forwarding all revised reporting forms and instructions, and all other correspondence relating to your Public Goods Pools payment and reporting obligations, to you as well as your TPA. The primary responsibility of insuring that the monthly reporting forms are timely filed rests with the electing payor. If reports are not filed, or not timely filed, any penalties and interest would be imposed on the electing payor. If you have an agreement with a TPA whereby the TPA is preparing and/or submitting reporting forms on your behalf, it is your responsibility to insure that your TPA files all appropriate monthly report forms in compliance with the instructions in this transmittal.

As you may know, the New York Health Care Reform Act of 2000 (HCRA 2000) was signed into law on December 30, 1999. Following are issues which deserve special mention:

  • The law extends the existing surcharges (i.e., 32.18%, 8.18%, and 5.98%) on assessable services rendered by designated providers through June 30, 2003. The alternative inpatient professional education pool surcharge applicable to inpatient hospital payments made by affected non-electing payors is also extended and is fixed at the 1999 levels through June 30, 2003.
  • The law continues the covered lives assessments applicable to affected electing payors. Section 2807-t(6) of the Public Health Law requires that prospective adjustments be made to Professional Education Pool (PEP) covered-lives assessments to reconcile PEP regional under/over funding for a prior period. The law specifies that such adjustments be made in "...the year next following the calculation of the reconciliation". Since funding of the 1998 PEP is now considered complete, the Department has finalized the level of under/over funding within each region and has incorporated this amount in the calculation of the year 2000 regional covered lives assessments. Please note that these 2000 regional covered lives assessment amounts are reflected on the 2000 service year portion of the Report of Covered Lives Assessment.
  • All elections in effect on December 1, 1999, are automatically extended through June 30, 2003, unless otherwise revoked or rescinded. HCRA 2000 did not amend the election application provisions of the law; however, the revocation provisions of PHL Section 2807-j(5)(a)(ii) were amended to authorize quarterly revocations. Commencing January 1, 2000, a payor may revoke its direct payment election application effective January 1, April 1, July 1, or October 1, provided a completed Attachment #7 (DOH-4100, Request to Rescind Election Status) is received by the Pool Administrator postmarked no later than thirty days prior to the quarterly revocation effective date.
  • An exemption from the HCRA surcharges is authorized for freestanding and hospital/clinic based referred Article V clinical laboratory services provided on and after October 1, 2000. Please refer to the instructions for a definition of services qualifying for such exemption. Due to contingencies provided in the law, payors should maintain a database of payments made for such exempt services, segregated by service year, payor classification (i.e., 8.18% and 5.98%), and provider classification (i.e., hospital outpatient, ambulatory surgery, comprehensive clinic and freestanding laboratory). This information, upon request, may be subject to disclosure to the Department.
  • The provisions of PHL Section 2807-j(7)(c) provide that if an electing payor fails to file reports required pursuant to PHL Section 2807-j(7)(a), which are due on and after January 1, 2000, within 60 days of the date such reports are due and after notification of such reporting delinquency, the Commissioner may assess a civil penalty of up to ten thousand dollars for each such failure, provided, however, that such civil penalty shall not be imposed if the payor demonstrates good cause for the failure to timely file such reports.
  • Pursuant to PHL Section 2807-j(5)(d), electing payors which, in the course of an audit, commenced on or after January 1, 2000, conducted by the Commissioner or the Commissioner´s designee relating to any period on and after January 1, 1997, fail to produce data or documentation requested in furtherance of such audit within thirty days of such request, may be assessed a civil penalty by the Commissioner of up to ten thousand dollars for each such failure, provided, however, that such civil penalty shall not be imposed if the payor demonstrates good cause for the failure to timely produce such data or documentation.
  • The provisions of PHL Sections 2807-t(5)(a), 2807-j(5-a)(a) and 2807-j(7)(b) provide that the Commissioner may permit payors, whose aggregate covered lives assessments and surcharge liability on an annual basis is not expected to exceed $10,000, based on prior years reported data, to submit Public Goods Pool reports and related surcharge and assessment obligations on an annual basis. Due to lead-time required to implement numerous procedural and systems modifications, the Department does not anticipate implementing this annual reporting provision until 2001. Correspondingly, all payors must continue to submit reports monthly, even if there is no activity to report. There will not be an application process for annual filing. The Department will determine which payors are eligible and will send written notification to them prior to implementing the annual filing provisions of the law. Keep in mind that one of the eligibility criteria will be that payors may not have any reporting delinquencies. Therefore, payors are encouraged to file timely monthly reports and to ensure that they do not have any reporting delinquencies for prior periods.

A schedule of report and payment due dates for the months of January through December 2000 is provided on the second page of the instructions. Since payors cannot determine their monthly Public Goods Pool liability until sometime following the last day of the respective reporting month, all monthly reports submitted prior to the end of the respective reporting month will be returned.

Reports must be completed and submitted in accordance with the enclosed instructions. If, upon review, a report is deemed unacceptable, the report may be returned and a delinquency notice issued. Repeated late payments, failure to remit correct amounts, or to provide adequate certification of the accuracy of surcharge payments can result in the revocation of an electing payor´s direct pay status potentially subjecting them to higher surcharges. Furthermore, untimely filing of reports and payments can result in the imposition of interest and penalties determined in accordance with the provisions of Section 2807-j(8) of the Public Health Law.

A more detailed summary on how HCRA 2000 will impact payor and provider pool payment obligations will be shortly posted on the Department´s WEB site. This will be followed by a posting of necessary revisions to the Forms, Questions and Answers, and relevant Public Health Law sections currently posted on this WEB site.

Should you have any questions concerning the foregoing or the enclosed forms, please contact Mr. Richard Pellegrini, Director of the Bureau of Financial Management and Information Support at (518) 473-4653.

Sincerely,

Mark H. Van Guysling
Assistant Director
Division of Health Care Financing

Enclosures