N.Y. Public Health Law § 2807-ff: New York managed care organization provider tax

§ 2807-ff. New York managed care organization provider tax. 1. The

commissioner, subject to the approval of the director of the budget,

shall: apply for a waiver or waivers of the broad-based and uniformity

requirements related to the establishment of a New York managed care

organization provider tax (the "MCO provider tax") in order to secure

federal financial participation for the costs of the medical assistance

program; and, subject to approval by the centers for Medicare and

Medicaid services, impose the MCO provider tax as an assessment upon

insurers, health maintenance organizations, and managed care

organizations (collectively referred to as "health plan") offering the

following plans or products:

(a) Medical assistance program coverage provided by managed care

providers pursuant to section three hundred sixty-four-j of the social

services law;

(b) A health insurance plan serving individuals enrolled pursuant to

title one-A of article twenty-five of this chapter;

(c) Essential plan coverage certified pursuant to title eleven-D of

article five of the social services law;

(d) Coverage purchased on the New York insurance exchange established

pursuant to section two hundred sixty-eight-b of this chapter; or

(e) Any other comprehensive coverage subject to articles thirty-two,

forty-two and forty-three of the insurance law, or article forty-four of

this chapter.

1-a. On or after April first, two thousand twenty-six, the

commissioner, subject to the approval of the director of the budget,

shall apply for an amendment of the MCO provider tax, subject to

approval by the centers for Medicare and Medicaid services, to impose an

amended MCO provider tax as an assessment upon health plans no sooner

than January first, two thousand twenty-seven, as established in

paragraph (b) of subdivision four of this section.

2. The MCO provider tax shall comply with all relevant provisions of

federal laws, rules and regulations.

3. The department shall post on its website the MCO provider tax

approval letter by the centers for Medicare and Medicaid services (the

"approval letter").

4. (a) Prior to January first, two thousand twenty-seven, a health

plan, as defined in subdivision one of this section, shall pay the MCO

provider tax for each calendar year as follows:

(i) For Medicaid member months below two hundred fifty thousand member

months, a health plan shall pay one hundred twenty-six dollars per

member month;

(ii) For Medicaid member months greater than or equal to two hundred

fifty thousand member months but less than five hundred thousand member

months, a health plan shall pay eighty-eight dollars per member month;

(iii) For Medicaid member months greater than or equal to five hundred

thousand member months, a health plan shall pay twenty-five dollars per

member month;

(iv) For essential plan member months less than two hundred fifty

thousand member months, a health plan shall pay thirteen dollars per

member month;

(v) For essential plan member months greater than or equal to two

hundred fifty thousand member months, a health plan shall pay seven

dollars per member month;

(vi) For non-essential plan non-Medicaid member months, consisting of

the populations covered by the products described in paragraphs (b),

(d), and (e) of subdivision one of this section, less than two hundred

fifty thousand member months, a health plan shall pay two dollars per

member month; and

(vii) For non-essential plan non-Medicaid member months greater than

or equal to two hundred fifty thousand member months, a health plan

shall pay one dollar and fifty cents per member month.

(b) Effective January first, two thousand twenty-seven, subject to any

required approvals by the centers for Medicare and Medicaid services, a

health plan, as defined in subdivision one of this section, shall pay

the MCO provider tax for each calendar year at a rate of 0.35% of the

health plan's total premium revenue.

5. A health plan shall remit the MCO provider tax due pursuant to this

section to the commissioner or their designee quarterly or at a

frequency defined by the commissioner.

6. Funds accumulated from the MCO provider tax, including interest and

penalties, shall be deposited and credited by the commissioner, or the

commissioner's designee, to the healthcare stability fund established in

section ninety-nine-ss of the state finance law.

7. (a) Every health plan subject to the approved MCO provider tax

shall submit reports in a form prescribed by the commissioner to

accurately disclose information required to implement this section.

(b) If a health plan fails to file reports required pursuant to this

subdivision within sixty 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 failure;

provided, however, that such civil penalty shall not be imposed if the

health plan demonstrates good cause for the failure to timely file such

reports.

8. (a) If a payment made pursuant to this section is not timely,

interest shall be payable in the same rate and manner as defined in

subdivision eight of section twenty-eight hundred seven-j of this

article.

(b) The commissioner may waive a portion or all of either the interest

or penalties, or both, assessed under this section if the commissioner

determines, in their sole discretion, that the health plan has

demonstrated that imposition of the full amount of the MCO provider tax

pursuant to the timelines applicable under the approval letter has a

high likelihood of creating an undue financial hardship for the health

plan or creates a significant financial difficulty in providing needed

services to Medicaid beneficiaries. In addition, the commissioner may

waive a portion or all of either the interest or penalties, or both,

assessed under this section if the commissioner determines, in their

sole discretion, that the health plan did not have the information

necessary from the department to pay the tax required in this section.

Waiver of some or all of the interest or penalties pursuant to this

subdivision shall be conditioned on the health plan's agreement to make

MCO provider tax payments on an alternative schedule developed by the

department that takes into account the financial situation of the health

plan and the potential impact on the delivery of services to Medicaid

beneficiaries.

(c) Overpayment by or on behalf of a health plan of a payment shall be

applied to any other payment due from the health plan pursuant to this

section, or, if no payment is due, at the election of the health plan,

shall be applied to future payments or refunded to the health plan.

Interest shall be paid on overpayments from the date of overpayment to

the date of crediting or refunding at the rate determined in accordance

with this subdivision only if the overpayment was made at the direction

of the commissioner. Interest under this paragraph shall not be paid if

the amount thereof is less than one dollar.

9. Payments and reports submitted or required to be submitted to the

commissioner pursuant to this section by a health plan shall be subject

to audit by the commissioner for a period of six years following the

close of the calendar year in which such payments and reports are due,

after which such payments shall be deemed final and not subject to

further adjustment or reconciliation, including through offset

adjustments or reconciliations made by a health plan; provided, however,

that nothing in this section shall be construed as precluding the

commissioner from pursuing collection of any such payments which are

identified as delinquent within such six-year period, or which are

identified as delinquent as a result of an audit commenced within such

six-year period, or from conducting an audit of any adjustment or

reconciliation made by a health plan, or from conducting an audit of

payments made prior to such six-year period which are found to be

commingled with payments which are otherwise subject to timely audit

pursuant to this section.

10. In the event of a merger, acquisition, establishment, or any other

similar transaction that results in the transfer of health plan

responsibility for all enrollees under this section from a health plan

to another health plan or similar entity, and that occurs at any time

during which this section is effective, the resultant health plan or

similar entity shall be responsible for paying the full tax amount as

provided in this section that would have been the responsibility of the

health plan to which that full tax amount was assessed upon the

effective date of any such transaction. If a merger, acquisition,

establishment, or any other similar transaction results in the transfer

of health plan responsibility for only some of a health plan's enrollees

under this section but not all enrollees, the full tax amount as

provided in this section shall remain the responsibility of that health

plan to which that full tax amount was assessed.