On May 22, 2020, the Department of Financial Services (DFS) issued Circular Letter No. 12 regarding coverage for COVID-19 testing at pharmacies. This communication was issued to all insurers authorized to write health insurance in the state, amongst other parties.

In order to increase access to COVID-19 testing in the state, Gov. Cuomo previously issued Executive Order 202.24. This directive authorized licensed pharmacists to order and administer FDA approved tests to detect a COVID-19 infection or its antibodies. It also allowed pharmacists to be designated as qualified healthcare professionals for the purpose of directing limited service laboratories to conduct such tests.

The purpose of the circular letter is to advise insurers of their coverage obligations with respect to the pharmacy COVID-19 testing. Accordingly, issuers are reminded that diagnostic testing is an essential health benefit and therefore must be covered under individual and small group health insurance policies. Under state insurance laws, issuers of large group policies must also make coverage available for laboratory tests.

Furthermore, the coverage for the COVID-19 testing at pharmacies must be provided without cost sharing. State insurance law and the CARES Act prohibit the assessment of copayments, coinsurance or annual deductibles for both in-network and out-of-network COVID-19 testing. For out-of-network testing, the issuer must pay the provider’s publicly listed cash price, unless a lower rate is negotiated.

The letter is primarily directed at issuers, but encourages third party administrators licensed as independent adjusters by the state to apply the provisions to their administrative service arrangements with self-funded plans. Employers may also want to be aware of this correspondence.

Circular Letter No. 12 »

On May 29, 2020, the Department of Financial Services (DFS) released COVID-19 information for insurers and providers regarding mental health coverage for essential workers. The guidance, which is in the form of questions and answers, addresses issues such as the scope, administrative aspects and notice obligations of the new coverage requirements. 

As background, on May 2, 2020, DFS amended the state’s Insurance Regulation 62 to provide essential workers with temporary relief from cost sharing for mental health services. The amendment recognized the emotional and psychological impact of the COVID-19 public emergency on these workers by alleviating costs they would otherwise incur for seeking in-network mental health services.

The questions clarify that the cost sharing waiver applies to all outpatient mental health services provided by in-network providers on or after May 2, 2020, but does not extend to prescription drugs. This relief measure extends to all individuals who are, or were, essential workers during the state of emergency declared by Gov. Cuomo on March 7, 2020.

Insurers are required to notify in-network mental health providers not to collect any deductible, copayment, or coinsurance from essential workers, and to provide a definition and list of these workers. However, the issuer remains responsible for reimbursing the provider for the cost-sharing amount.

Although this emergency relief measure is primarily directed at issuers, employers may want to be aware of the amendment and this subsequent guidance. For a summary of the underlying insurance amendment, please see our May 27, 2020, issue of Compliance Corner.

Coronavirus (COVID-19) Information for Insurers and Providers on Coverage for Mental Health Services for Essential Workers »

On May 22, 2020, the Division of Insurance issued LH Bulletin No. 2020-03 to life and health insurers and HMOs licensed by the state. The division expressed its expectation that those insurers and HMOs will cover polymerase chain reaction (PCR) tests and antigen tests, which are designed to detect COVID-19, when there is a medical need to provide them. The division also expects them to cover FDA-authorized antibody tests, waive cost-sharing requirements for those tests and process claims for those tests in accordance with federal guidelines. This expectation does not extend to antibody tests that are performed as part of a “return-to-work” program or other efforts not associated with disease diagnosis or treatment.

The division also encourages administrators of self-funded plans to comply with the bulletin.

Employers in the state or whose plans are regulated by the state should be aware of these developments.

LH Bulletin No. 2020-03 »

On May 2, 2020, the Department of Financial Services (DFS) amended the state’s Insurance Regulation 62 to provide essential workers with temporary relief from cost sharing for mental health services. The amendment pertains to all policies or contracts delivered or issued for delivery in the state.

Following the declaration of a public emergency in the state on March 7, 2020, the coronavirus (COVID-19) pandemic has significantly impacted all New Yorkers, but especially essential workers who have directly interacted with the public and exposed themselves and their families to health risks. The amendment recognizes the emotional and psychological toll on these essential workers by alleviating cost they would otherwise incur for seeking in-network mental health services.

Specifically, insurers and health maintenance organizations that provide comprehensive coverage for hospital, surgical or medical care are prohibited from imposing copayments, coinsurance or annual deductibles for mental health services rendered by in-network providers on an outpatient basis for essential workers. The amendment excepts high deductible health plans as defined in Code Section 223(c) (2) that may be required under federal law to subject a service to the plan’s annual deductible.

Additionally, the amendment requires an insurer to provide written notification, which may be by email, to in-network outpatient mental health providers that they shall not collect any deductible, copayment or coinsurance from an essential worker. The notice must include the definition of an essential worker.

For purposes of the amendment, essential workers are defined to include individuals who are or were employed as health care workers, first responders, or in any position within a nursing home, long-term care facility or other congregate care setting during the state of emergency declared in the state on March 7, 2020. Furthermore, the definition includes individuals employed as essential workers who interact with the public, such as transit workers, retail workers at essential businesses, delivery workers, food service workers, funeral service workers and security guards.

Although the amendment is primarily directed at issuers, employers may want to be aware of this emergency relief measure.

Insurance Regulation 62 Amendment »

On April 2, 2020, a new law was enacted that requires all employers to provide job-protected sick leave to New York employees. This new leave is separate from the recently enacted coronavirus paid leave requirements, which are more limited to the current health emergency in scope and duration.

As background, Gov. Cuomo recently signed the state budget for the 2021 fiscal year. The new sick leave mandates were incorporated within the budget. These measures are designed to protect both workers and consumers in the state by providing leave relating to physical or mental conditions or domestic violence affecting employees or their family members.

The amount of the leave and whether it is paid or unpaid depends upon the employer’s total number of global employees and net income. Employers with four or fewer employees and net income of less than $1 million must provide employees with up to 40 hours of unpaid sick leave in each calendar year. Employers with 1) four or less employees and net income greater than $1 million in the prior tax year or 2) between five and 99 employees must provide up to 40 hours of paid sick leave. Employers with 100 or more employees are required to offer up to 56 hours of paid sick leave.

The sick leave accrues at a rate of one hour per every 30 hours worked beginning on September 30, 2020. Employees are entitled to begin using the leave as of January 1, 2021, upon oral or written request for one of the following qualifying reasons:

1. A mental or physical illness, injury or health condition of such employee or such employee's family member, regardless of whether diagnosed or requiring medical care at the time
2. The diagnosis, care or treatment; need for medical diagnosis of; or preventive care of a mental or physical illness, injury or health condition of such employee (or such employee's family member)
3. An absence from work due to any of the following reasons when the employee or employee's family member has been the victim of domestic violence, a family offense, sexual offense, stalking or human trafficking:
   1. To obtain services from a domestic violence shelter, rape crisis center or other services program
   2. To participate in safety planning, temporarily or permanently relocate, or take other actions to increase the safety of the employee or employee's family members
   3. To meet with an attorney or other social services provider to obtain information and advice on, and prepare for or participate in, any criminal or civil proceeding
   4. To file a complaint or domestic incident report with law enforcement
   5. To meet with a district attorney's office
   6. To enroll children in a new school
   7. To take any other actions necessary to ensure the health or safety of the employee or the employee's family member or to protect those who associate or work with the employee

The law defines a "family member" as an employee's child, spouse, domestic partner, parent, sibling, grandchild or grandparent; and the child or parent of an employee's spouse or domestic partner.

For paid sick leave, the employee is entitled to compensation at their regular rate of pay or the applicable minimum wage, whichever is greater. An employee's unused sick time is carried over to the following year; however, employers are permitted to place certain restrictions on the amount used each year. Unused leave does not have to be paid upon an employee’s termination.

An employer that already has a sick leave policy or time off policy that provides employees with equal or greater leave amounts and satisfies the accrual, carryover and use requirements would not need to provide additional sick leave. However, the law does not prohibit cities with populations of one million or more from enacting laws that exceed these requirements.

Employers should be aware of the new paid sick leave requirements and may need to update their existing leave polices and employee communications accordingly. Additionally, employers should be prepared to begin tracking the leave accrual requirements in the fall and documenting leave requests in 2021. As previously noted, these leave provisions were included (as Part J) of the state’s 2021 fiscal year budget.

Fiscal Year Budget »

The Department of Financial Services (DFS) recently released questions and answers regarding coronavirus (COVID-19) coverage requirements. This guidance pertains to health insurance policies issued or delivered in the state.

In March, DFS enacted emergency regulations to waive cost sharing for certain testing and diagnostic services related to COVID-19. These amendments also addressed the use of telehealth during the state of emergency. Similar legislation has been passed on the federal level.

Accordingly, the questions and answers address the specific coverage requirements resulting from the new laws. The guidance reinforces the prohibitions against copayments, coinsurance and annual deductibles for in-network laboratory tests and health care provider visits, including telehealth, urgent care and emergency department services, to diagnose COVID-19. However, cost sharing can be imposed for COVID-19 follow-up care or treatment, such as inpatient hospital admissions. Additionally, no cost sharing can be imposed for any medically appropriate in-network services (not limited to COVID-19 diagnosis) delivered via telehealth, if otherwise covered under the policy if delivered in person. The guidance further addresses related issuer notice and filing requirements, as well as utilization review suspensions and overpayment concerns.

Although the underlying DFS regulations are primarily directed at issuers, employers may find the questions and answers helpful in better understanding the COVID-19 coverage requirements during the state of emergency.

Health Insurer Guidance on Coverage Requirements for Novel Coronavirus (COVID-19) »

On April 7, 2020, the State Department of Financial Services amended provisions of the state’s financial services and insurance laws to assist state residents during the coronavirus (COVID-19) pandemic. The measures are intended to promote continuity of coverage throughout the health emergency.

As background, on April 7, 2020, Gov. Cuomo issued Executive Order 202.14, which temporarily modifies insurance laws to extend the payment periods for certain health insurance premiums. The extension is available to holders of individual, small group and student blanket comprehensive health insurance policies who can demonstrate financial hardship as a result of the COVID-19 pandemic.

Accordingly, for eligible policyholders, the amendments extend the premium payment period to the later of the expiration of the contractual grace period and 11:59 p.m. on June 1, 2020. Insurers are responsible for the payment of claims and cannot retroactively terminate the policy during such period. Additionally, issuers are prohibited from imposing late fees or reporting negative data regarding the policyholders to credit reporting agencies. Policyholders must also be provided with information regarding alternate policies and contracts available from the issuer.

The emergency measures are primarily directed at insurers. However, employers should also be aware of these developments.

Fifty-Ninth Amendment to 11 NYCRR 52 »

On March 18, 2020, Gov. Cuomo signed S. 8091 law, imposing new requirements on employers as a result of the coronavirus (COVID-19). Amongst other items, the legislation mandates that New York employers provide sick leave and job protections to employees quarantined as a result of the pandemic.

The initiative follows a significant increase in positive COVID-19 cases in the state and was passed the same day as the federal Families First Coronavirus Response Act (FFCRA). The state law serves to supplement the FFCRA and protect employees to the extent not covered under the federal legislation.

Generally, the sick leave must be provided to employees who have been subjected to COVID-19 mandatory or precautionary orders of quarantine or isolation. There are exceptions for asymptomatic employees who have not been positively diagnosed with COVID-19 and can work remotely. The paid leave is in addition to any other paid sick leave an employee may have already accrued.

The employer’s net income in the previous tax year and/or employee count as of January 1, 2020, determine the length of the sick leave and whether it is paid. Specifically, an employer with 10 or less employees and net income of less than $1 million must provide unpaid sick leave until the termination of any quarantine or isolation. During this period, employees will be eligible for New York State Paid Family Leave (PFL) and short-term disability benefits. 

An employer with 10 or fewer employees and net income over $1 million or an employer with 11 to 99 employees must provide at least five days paid sick leave, then unpaid sick leave for the remainder of the quarantine or isolation. After five days, the employee is eligible for PFL and short-term disability benefits.

An employer with 100 or more employees or a public employer must provide at least 14 days of paid sick leave during any order of quarantine or isolation. Accordingly, and in contrast to the FFCRA, the state law applies to employers with 500 or more employees.

Employers should be aware of the law, which became effective upon enactment. Generally, these employers would be required to provide any state mandated benefits to eligible employees to the extent such benefits were not already required under the FFCRA or other federal law.

S. 8091 »
NY Paid Family Leave COVID-19 FAQs »

On March 16, 2020, NY State of Health and New York State Department of Financial Services announced a special enrollment period available to residents. During this period, eligible individuals will be able to enroll in insurance coverage through NY State of Health, the state’s official health plan Marketplace, and directly through insurers.

This measure was taken as a result of the COVID-19 public health emergency to further protect the health of New Yorkers. The government and state health insurers were concerned that uninsured individuals might avoid seeking COVID-19 testing or medical care for fear of cost. The open enrollment period for 2020 coverage had previously ended on February 7, 2020.

The special enrollment period extends from March 16 through April 15, 2020. Individuals who enroll in Qualified Health Plans through NY State of Health or directly through insurers during this period will have coverage effective starting April 1, 2020.

Employers should be aware of this special enrollment period, which may provide an option for individuals not otherwise eligible to enroll in coverage.

Press Release »
Q&A on Coronavirus Special Enrollment Period (SEP) IN Qualified Health Plans (QHP) »

On March 3, 2020, the Department of Financial Services issued Insurance Circular Letter No. 3 regarding coronavirus (COVID-19) preparedness and cost sharing. The guidance is directed at insurers authorized to write accident and health insurance in the state.

As a result of the COVID-19 outbreak, which includes cases in the state, the letter instructs insurers to take action to prepare for the impact. These issuers should be ready to address potential COVID-19 cases and to provide insureds with timely information and access to all medically necessary covered health services.

Accordingly, insurers are directed to identify and remove barriers to COVID-19 testing and treatment, including by waiving cost sharing for laboratory tests and in-network office, urgent care and emergency visits. Additionally, carriers are asked to review their telehealth delivery services, network adequacy and out-of-network services to ensure these are capable of handling increased demands. The letter further reminds carriers of the state’s coverage requirements with respect to non-formulary prescription drug access, hospital, emergency and ambulance services, and surprise billing, among other items.

The circular also discusses the Fifty-Seventh Amendment to Insurance Regulation 62 as an emergency measure. This amendment is applicable to policies or contracts delivered or issued for delivery in the state that provide hospital, surgical or medical coverage.

As background, this measure was enacted in response to the increasing number of coronavirus (COVID-19) cases in the United States, including in New York. Given the health implications of a rapid spread of the virus, it is important that cost sharing not serve as a barrier to COVID-19 testing.

As a result, the amendment prohibits health care plans from imposing copayments, coinsurance or annual deductibles for covered in-network laboratory tests to diagnosis COVID-19 and for COVID-19 diagnostic visits (including through telehealth) at an in-network provider’s office, urgent care center or other in-network outpatient provider, or a hospital emergency department. However, copayments, coinsurance and annual deductibles may be imposed for any follow-up care or treatment for COVID-19, including an inpatient hospital admission, in accordance with the policy and applicable law.

Insurers are required to provide written notification of the amendment requirements to in-network providers to ensure that prohibited copayments, coinsurance or annual deductibles are not imposed or collected from insureds. Employers of insured plans should also be aware of this emergency measure.

Circular Letter No. 03 »