CONTACT:     Steven Greenberg (518) 469-9858 

FOR RELEASE:   May 30, 2007

Full list of contacts for all participating groups is at the end of the release. 

Business Leaders Fight To Level the Playing Field for Employers, Patients & Providers in Dealing with Health Insurers

Legislative Package Proposed to End Skyrocketing Premiums

and Abusive Insurer Conduct & Improve Access to Health Care

Legislation Includes Health Care Community Reinvestment Fund

Albany – Decrying record high health insurance company profits as employers are forced to pay skyrocketing health insurance premiums for their employees, a unique coalition of business leaders, consumer rights advocates, health care representatives, and legislators from across the state today urged immediate passage of a package of crucial legislation to level the playing field between for-profit health insurance companies andnot-for-profit health care providers.  The business leaders cited excessive health insurance premium increases, decreasing benefits for patients, abusive business practices by insurers, and diminished reimbursements to hospitals and physicians as key factors damaging the economic infrastructure for businesses in New York.

The cornerstone of the five-bill package, unveiled at an Albany news conference, would create a first-of-its-kind Health Care Community Reinvestment Fund to improve the quality, availability and efficiency of health care services throughout New York.  Other bills would help stop abusive practices insurers take when reimbursing providers for services that the insurers have authorized for patients.

“Health insurance companies are continuing to make record-breaking profits, nearly $5 billion since 1999, while small and large employers suffer from huge annual increases to insurance premiums for their employees,” said William Mooney, Jr., President of the Westchester County Association (WCA), and a former Wall Street banker.  “Benefits for employees are reduced, hospitals and physicians are struggling to survive, and the only ones who benefit from this situation are the health insurers.  Simply put, this is not a sustainable system, nor is it a system that the people of our great state deserve or need.

“We can no longer afford to watch our health care infrastructure dissolve around us while health insurance companies generate tremendous profits and charge employers outrageous premiums.  Our plan moves excess premiums back into the health care system to improve health care and strengthen our communities, rather than further lining the pockets of insurance executives.  This is good health care policy and it is also good economic, pro-business policy,” said Mooney, whose association includes more than 600 of Westchester’s most prominent businesses, including many multi-national corporations. 

The Health Care Community Reinvestment Fund would require insurers to spend a high percentage of the premiums they receive from employers on medical care.  This is called the “medical loss ratio,” and is defined as the percentage of premium dollars the insurer actually spends on health care services for enrollees.  If an insurer fails to meet the required medical loss ratio it would be required by law to pay into this newly created fund.

More information on the legislative package of five bills is attached to this news release.

Mooney was joined in Albany by other business leaders from across New York, including:

Vincent Abbatecoli, President of Abby Ice and Water;

Joseph Armentano, President & CEO of Paraco Gas;

Stephen Dunn, Owner & CEO of Dunn Builders Supply, Greene County;

Richard French, III, General Manager of RNN-TV

Lowell Fry, President of Champion Cutting Tool, Long Island

R. Abel Garraghan, President of Heritagenergy, Inc., Ulster County;

Robert A. Glazer, CEO, ENT and Allergy Associates, Westchester County

John Hopkinson III, Ph.D., Former General Manager, Lake Placid Operations, Upstate USA & Partner, Adirondack Venture Fund

Ron Knight, Group President & Chief of Staff, Harris Interactive, Monroe County;

John Lane, Managing Director (retired) of J.P. Morgan, Long Island;

John Neubauer, President of Audio Visual Products, Inc., Putnam County;

Richard O’Beirne, Executive Director of Construction Contractors Association, Orange County;

John Rath, Senior Bank Executive and Chairman of the Board of Trustees, Vassar Brothers Medical Center, Poughkeepsie;

John Robinson, Chairman of the Board of Albany Medical Center and former Vice-President of Fleet Bank;

Edward Roetman, Owner Adirondack McDonalds, Saranac Lake & Tupper Lake;

Markham F. Rollins III, Co-Chairman & CEO, Rollins Agency, Westchester

“The whole system is out of balance.  The insurance companies are in control with our money.  They are making astronomical profits while hospitals are struggling.  Their share of health care dollars is inconsistent with the value they add.  As businesses that pay the premiums, we have no voice.  We don’t see any improvement in benefits for our employees.  And the increased premiums are negating the salary increases for our employees.  It’s time to bring fairness and equity back into the system,” said Knight, of Harris Interactive in Rochester.  Knight was also COO for the Sutherland Group in Rochester, and retired after 30 years with Xerox as Vice President.

"As a business owner with employees that serve thousands of households in the Hudson Valley, knowing that hospitals have the ability to provide quality, affordable care is both a business and a personal concern.  All businesses, regardless of size, have felt the crunch of skyrocketing health insurance premiums, while benefits decrease and our hospitals suffer financially.  The tables have to be turned so that New York remains a viable state in which to live and work,” said Heritagenergy’s Garraghan.

"Hospitals and healthcare are critical to the well-being of our communities and our workforce, and it is important that we continue to support this sector in order to attract a first-class workforce,” said Rath, a senior banking executive and Chairman of the Board at Vassar Brothers Medical Center.

"If the status quo remains, it will only result in greater HMO profits or excessive reserves at the expense of businesses who pay the premiums.  The right alternative is to make these changes to invest in hospitals and improved health care delivery, which helps businesses recruit employees, I think the choice is clear.  We can no longer afford to have insurers be part of the problem, we must ensure that they become part of the solution,” said Robinson.

Dunn, of Dunn Builder Supply said, “The current system is virtually upside down: hospitals are losing money across the state, employers pay more each year for health insurance, and all the while HMOs are reaping record profits as they deny or delay patient care and payment. The fact is, many of the prevalent HMO practices represent the ultimate in bait-and-switch. Employers and employees alike simply are not getting what we pay for. We need these new laws to ensure that HMOs adequately invest in the system and that they consistently deliver the services and payments their policies and contracts promise."

"As a small business owner, I am proud to be able to provide my employees with health insurance.  It has become increasingly difficult to do so, however, and I am concerned that the insurance I can afford to provide for my crew is not the quality of insurance it should be.  The cost of the insurance is increasingly prohibitive.  Not only is it our responsibility as business owners to work to hold down insurance premiums, it is more importantly the insurance company's responsibility to hold down insurance premiums and not line their coffers with excessive profits," said Roetman of Adirondack McDonalds in the North Country.

Arthur Levin, M.P.H., Director of the Center for Medical Consumers, New York's leading patient advocacy organization, said, "Patients face enormous challenges when negotiating the health care system. But some policies of the health insurance industry compound those difficulties, or worse, may impede access to necessary care. These HMO reform proposals are aimed at making health insurance companies more patient-centered and more responsible in how they reinvest surplus premium dollars to provide better access to health care for New Yorkers.”

“Right now, New York’s hospitals, patients and employers lose, while insurers gain.  Adding insult to injury, insurers pay hospitals and physicians in New York up to 30 percent less for the same services than they pay providers in Connecticut and New Jersey.  The New York market needs to be rebalanced so that businesses, hospitals and physicians can negotiate with insurers on an equal level,” said Neil Abitabilo, President of the Northern Metropolitan Hospital Association.

“Health insurers – acting in a monopolistic manner – have taken advantage of inequitable market conditions and acted in bad faith, unjustly limiting patients’ access to care and unethically reducing or delaying payments to hospitals and physicians.  We are not seeking to give hospitals, doctors and employers the advantage in the relationship with HMOs.  All we want is to end the dominance that the insurance companies currently have,” said Kevin Dahill, President & CEO of the Nassau-Suffolk Hospital Council. 

“It's become clear that through nuance and technical chicanery, many insurers routinely deny or delay the services and payments they are obligated to provide to patients and providers. It's as unfortunate as it is telling that we now need new laws requiring insurers to do what they are already supposed to be doing: delivering the benefits their subscribers are promised, paying providers for care that is approved and delivered, and delivering to premium payers the insurance coverage they've been paying for all along,” said Daniel Sisto, President of the Healthcare Association of New York State (HANYS).

“Our New York State healthcare infrastructure is seriously threatened by the irresponsible profiteering of the health insurance industry’s monopolistic stranglehold on healthcare finance.  They are overcharging business and government payers.  They are undercompensating our physicians and hospitals.  And perhaps most importantly, they are increasingly limiting access of patients who need care.  Something must be done now to assure the health insurers fulfill their roles as responsible members of the New York health care community,” said Dr. Robert B. Goldberg, DO, President of the Medical Society of the State of New York.

“For us, this isn’t a discussion simply about hospitals – crucial institutions in every community – or even about the quality of health care – crucial to all of us.   This is a discussion about the challenges facing the business community of New York State,” Mooney said.  “For much too long, the relationships between insurers and both premium payers and health care providers has been strongly slanted in favor of the insurance companies.  It’s time for that to change. We must level the playing field.  It’s about fighting to keep jobs in New York and not send them across our borders.” 

* * *

CONTACTS FOR PRESS RELEASE:

General questions...................................... Steven Greenberg  518-469-9858

Westchester County Association........... Amy Allen  914-948-1168

Center for Medical Consumers............. Art Levin  212-674-7105 x 31

HANYS.................................................... William Van Slyke  518-431-7770

Northern Metropolitan Hospital

     Association......................................... Angela Skretta-Huck  845-549-2112

Nassau-Suffolk Hospital Council........... Janine Logan  631-963-4156

Bi-Partisan Legislative Agenda to Level the Playing Field Between Providers and HMOs

Reforms Would Benefit Employers, Patients and Providers

Statewide Health Care Reinvestment Fund

Proposes reinvestment from health insurers that have lower medical cost ratios (payments for patient care). Regional use of funds based on needs of region, including support for the integration of health information technology for physicians and hospitals and physician recruitment. Regional healthcare community reinvestment committees composed of stakeholders (business, insurance, patients, state government, health care providers) would be authorized with oversight of funds.

Require Prompt Payment by Insurers (S.5540/A.8114 – Fuschillo/Bradley)

Requires insurers to pay providers within 15 days for electronic claims and within 30 days for paper claims.  Limits insurers’ ability to demand refunds beyond 24 months for hospitals and physicians unless claiming fraud.  Increases penalties for repeat prompt pay violators.

Require Insurers to Pay When a Service They Authorized is Rendered

(S.5459/A.8321 – Hannon/Gottfried)

When insurers authorize a procedure or admission, they should pay the contracted rate.  No excuses.

Limit Financial Liability of Patients (S.5119/A.8322 – Hannon/Gottfried)

For health plans that offer in- and out-of-network benefits:  limit the liability of an enrollee for services rendered in an in-network hospital to co-pay, deductible and coinsurance regardless of whether the admitting or treating physician is out-of-network  Additionally, the plan must reimburse the hospital at the full contracted rate.

Require Insurers to Make Payments Directly to the Provider When Asked By Patient to Do So (S.5123/A.8335 – Hannon/Gottfried)

Require insurers to permit an insured to assign his rights under his contract with the insurer to an out-of-plan provider.   When an assignment has been made, the insurer must reimburse the provider directly.  Payers should honor patients’ requests.