Bill > S08590

This bill establishes new requirements for how insurance companies and health care organizations must process and pay hospital claims, creating a structured process for claim payment and subsequent medical necessity review. Specifically, insurers must pay hospital claims at the contracted rate within specified timeframes, regardless of their internal policies about medical necessity or documentation. After payment, the insurer can request clinical documentation and have it reviewed by a joint committee composed of equal numbers of medical directors from the hospital and insurance company, which will review whether the services were medically necessary. If the joint committee cannot agree, they must forward the documentation to an independent third-party review agent whose determination will be binding. The bill limits the number of claims that can be reviewed (initially 10%, potentially increasing to 15% if many claims are found to be inappropriate) and sets specific timelines for documentation submission and review. If services are determined to be not medically necessary, the hospital must refund the payment, and importantly, cannot bill the patient for those services except for standard copayments, coinsurance, or deductibles. The bill aims to streamline the claims payment process, provide transparency, and protect hospitals and patients from prolonged payment disputes. The provisions will take effect on January 1, 2026.

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https://www.nysenate.gov/legislation/bills/2025/S8590