Bill Text: NJ A1455 | 2012-2013 | Regular Session | Introduced
Bill Title: Establishes up to four-month extension for expiring carrier contracts with acute care hospitals while parties engage in contract renegotiation.
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Introduced - Dead) 2012-01-10 - Introduced, Referred to Assembly Financial Institutions and Insurance Committee [A1455 Detail]
Download: New_Jersey-2012-A1455-Introduced.html
STATE OF NEW JERSEY
215th LEGISLATURE
PRE-FILED FOR INTRODUCTION IN THE 2012 SESSION
Sponsored by:
Assemblyman REED GUSCIORA
District 15 (Hunterdon and Mercer)
SYNOPSIS
Establishes up to four-month extension for expiring carrier contracts with acute care hospitals while parties engage in contract renegotiation.
CURRENT VERSION OF TEXT
Introduced Pending Technical Review by Legislative Counsel
An Act concerning certain insurance contracts with acute care hospitals, supplementing Title 17B of the New Jersey Statutes and repealing section 2 of P.L.1989, c.321.
Be It Enacted by the Senate and General Assembly of the State of New Jersey:
1. a. As used in this section:
"Carrier" means an insurance company, health service corporation, hospital service corporation, medical service corporation or health maintenance organization authorized to issue health benefits plans in this State.
"Covered person" means a person on whose behalf a carrier offering a health benefits plan is obligated to pay benefits or provide services pursuant to the plan.
"Covered service" means a health care service provided to a covered person under a health benefits plan for which the carrier is obligated to pay benefits or provide services.
"Health benefits plan" means a benefits plan which pays or provides hospital and medical expense benefits for covered services, and is delivered or issued for delivery in this State by or through a carrier. Health benefits plan includes, but is not limited to, Medicare supplement coverage and Medicare Advantage contracts to the extent not otherwise prohibited by federal law. For the purposes of this section, health benefits plan shall not include the following plans, policies or contracts: accident only, credit, disability, long-term care, Civilian Health and Medical Program for the Uniformed Services, CHAMPUS supplement coverage, coverage arising out of a workers' compensation or similar law, automobile medical payment insurance, personal injury protection insurance issued pursuant to P.L.1972, c.70 (C.39:6A-1 et seq.) or hospital confinement indemnity coverage.
"Hospital" means a general or special acute care facility licensed by the Commissioner of Health and Senior Services pursuant to P.L.1971, c.136 (C.26:2H-1 et seq.), including rehabilitation, psychiatric and long-term acute facilities.
b. (1) If a carrier, and a hospital with which the carrier has a contract to provide covered services to covered persons pursuant to a health benefits plan, are unable to agree on the terms of a new contract upon the expiration date expressly stated in that expiring contract, the carrier and hospital shall continue to abide by the terms of the expiring contract for a period of up to four months while engaged in efforts to renew or otherwise renegotiate the terms of that contract.
(2) In the event of a period of extension described in paragraph (1) of this subsection, the carrier shall promptly notify in writing: (a) each health care provider with which it has contracted to provide covered services; and (b) each covered person who resides in the county in which the hospital is located or in an adjacent county as to the extension of the terms of the expiring contract, and include in the notice options available to the covered person with respect to the person's health care coverage.
(3) (a) The period of extension may terminate before the end of the four-month period if the carrier and hospital agree on the terms of a new contract and mutually agree in writing to supersede the period of extension by operating under the terms of the new contract.
(b) The period of extension shall not be further extended by either the carrier or hospital, whether by unilateral action or mutual agreement of the parties.
c. (1) The provisions of this section shall not apply if either the carrier or hospital, or both, provide notice of their intention to terminate the contractual relationship upon the expiration of the contract with no intention of renewing or otherwise renegotiating the terms of that contract.
(2) Upon issuance of, or receipt by, the carrier of the notice described in paragraph (1) of this subsection, the carrier shall promptly notify in writing: (a) each health care provider with which it has contracted to provide covered services; and (b) each covered person who resides in the county in which the hospital is located or in an adjacent county as to the date of expiration of the expiring contract, and include in the notice options available to the covered person with respect to the person's health care coverage.
2. Section 2 of P.L.1989, c.321 (C.26:2J-11.1) is repealed.
3. This act shall take effect on the first day of the fourth month next following enactment, and shall apply to any contract entered into on or after the effective date.
STATEMENT
This bill establishes an up to four-month extension for expiring health insurance carrier contracts with acute care hospitals while the parties engage in contract renegotiations to continue their relationship concerning the provision of services to covered persons. It applies uniformly to all carriers, including each insurance company, health service corporation, hospital service corporation, medical service corporation or health maintenance organization authorized to issue health benefits plans in this State.
If a carrier and hospital are unable to agree on the terms of a new contract upon the expiration date expressly stated in their expiring contract, the carrier and hospital shall continue to abide by the terms of the expiring contract for a period of up to four months while engaged in efforts to renew or otherwise renegotiate the terms of that contract. In the event of a period of extension pursuant to the bill, the carrier shall promptly notify in writing: (1) each health care provider with which it has contracted to provide covered services; and (2) each covered person who resides in the county in which the hospital is located or in an adjacent county as to the extension of the terms of the expiring contract, and include in the notice options available to the covered person with respect to the person's health care coverage.
This period of extension may terminate before the end of the four-month period if the carrier and hospital agree on the terms of a new contract and mutually agree in writing to supersede the period of extension by operating under the terms of the new contract.
The period of extension provided by the bill shall not be further extended by either the carrier or hospital, whether by unilateral action or mutual agreement of the parties.
The provisions of the bill shall not apply if either the carrier or hospital, or both, provide notice of their intention to terminate the contractual relationship upon the expiration of the contract with no intention of renewing or otherwise renegotiating the terms of that contract. Upon issuance of, or receipt by, the carrier of this notice, the carrier shall promptly notify in writing: (1) each health care provider with which it has contracted to provide covered services; and (2) each covered person who resides in the county in which the hospital is located or in an adjacent county as to the date of expiration of the expiring contract, and include in the notice options available to the covered person with respect to the person's health care coverage.
In order to establish a uniform standard regarding any period of extension, the bill repeals section 2 of P.L.1989, c.321 (C.26:2J-11.1), which established an extension on contracts applicable between only a health maintenance organization and a hospital. As stated above, contracts involving a health maintenance organization, as one category of carrier, shall be henceforth covered under the provisions of this bill.
