Private Insurance Reimbursement in the New York State

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Private Insurance Reimbursement in the New York
State Early Intervention Program

• Brad Hutton, M.P.H.,
• Part C Coordinator
• New York State Dept. of Health
• National Early Childhood Conference
• December 3, 2007

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NYS Early Intervention Program

• 12/1/2006 child count 30,988
• 58 municipalities local programs
• Serve between 2/year to 20,000/yr.
• 660 provider agencies
• 20,000 individual therapists
• Racial/ethnic diversity
• 42 minority racial/ethnic groups
• Materials in 19 languages

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Total Expenditures by Funding Source, 2005-06

• 680 million in 2005-06
• 277 million (40) Medicaid
• 195 million (29) State
• 195 million (29) Counties
• 11 million (2) Private Insurance
• Leading expense for counties after Medicaid
• 25 of Medicaid costs in NYS paid by counties
  with new cap enacted 2 years ago
• 40 of children in program have private insurance

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Payment Process

• ISC obtains MA and insurance information,
  facilitates referral for enrollment in Medicaid,
  explains family protections
• Rights subrogated to counties for claiming
• County pays provider
• County then required to
• Claim for Medicaid reimbursement
• Claim for Private insurance
• Claim for State reimbursement of 50 of
  unreimbursed costs within two years
• 1 paid by private insurance equals 50c. savings
  to State and to counties

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Current Insurance Legislation in NYS for Early
Intervention

• Insurers prohibited from excluding coverage
  solely because services are early intervention
  program services
• Does not include
• ERISAs
• Self-insured
• Contracts delivered outside of NYS

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County Private Insurance Claiming Experience, 2006

• 1,045,523 claims submitted for third party
  insurance reimbursement in 2006
• 69.5 were denied, many multiple times
• Reasons for denial include
• 22 service not covered
• 21 no response from insurer
• 11 not medically necessary
• 9 provider out of network
• 8 no preauthorization obtained
• Also, location of services and duration of
  condition
• Not just financial issue, but administrative
  burden with little revenue recovered

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Legislative Protections

• Counties not obligated to bill if it will be
  applied to an annual or lifetime cap.
• Public reimbursement of co-payments and
  deductibles
• Services cannot reduce number of visits otherwise
  covered by plan (e.g., 10 PT visits per year)
• Cannot have impact on premiums
• Parents can refuse to provide insurance
  information and that cannot impact their
  eligibility or services in the program

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Administrative Efforts to Improve

• Guidance Document on Commercial Insurance
  Claiming, 2003
• Clarified claiming requirements for counties
• Services that did not need to be claimed (e.g.,
  special instruction and service coordination)
• Process for appeal of denials
• Prompt payment complaints 45 days
• Workgroup with counties and insurers
• Likely resulted in increase from 5 million to
  11 million paid per year

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Legislative History

• Numerous unsuccessful attempts to modify statute
  to address flaws in mandate
• Modification of Mandate IFSPs shall meet all
  preauthorization, medical necessity, and coverage
  cannot be denied due to location, duration of
  conditions, provider out of network
• Covered Lives Assessment fee per covered lives
  for all insurers used to support publicly funded
  programs in NYS
• 100 million increase proposed
• Inclusion of ERISAs

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Conclusions

• Funding from private insurers is essential for
  maintaining the financial security of programs
• Insurance mandates can be effective, but the
  details are essential