Bill Text: NJ S623 | 2010-2011 | Regular Session | Introduced
Bill Title: Provides additional enforcement provisions under "Health Care Quality Act"; allows certain private causes of action for violations; expands administrative remedies; establishes enforcement fund.
Spectrum: Partisan Bill (Democrat 2-0)
Status: (Introduced - Dead) 2010-01-12 - Introduced in the Senate, Referred to Senate Commerce Committee [S623 Detail]
Download: New_Jersey-2010-S623-Introduced.html
STATE OF NEW JERSEY
214th LEGISLATURE
PRE-FILED FOR INTRODUCTION IN THE 2010 SESSION
Sponsored by:
Senator ROBERT M. GORDON
District 38 (Bergen)
Senator LORETTA WEINBERG
District 37 (Bergen)
SYNOPSIS
Provides additional enforcement provisions under "Health Care Quality Act"; allows certain private causes of action for violations; expands administrative remedies; establishes enforcement fund.
CURRENT VERSION OF TEXT
Introduced Pending Technical Review by Legislative Counsel
An Act concerning certain health benefits plans and supplementing P.L.1997, c.192 (C.26:2S-1 et seq.).
Be It Enacted by the Senate and General Assembly of the State of New Jersey:
1. a. A covered person, a health care provider, or a professional organization representing a health care provider may commence a civil action in a court of competent jurisdiction against a carrier that offers a health benefits plan alleged to be in violation of any provision of Title 17 or 26 of the Revised Statutes, Title 17B of the New Jersey Statutes, or any law subsequently enacted for the governance of carriers or health benefits plans, or any rule, regulation, or order promulgated pursuant thereto. The civil action may be commenced upon an allegation that a carrier is in violation, either continuously or intermittently and that there is a likelihood that the violation will recur in the future. The action may be to assess a civil penalty of not more than $50,000 for each day that the carrier is in violation or for injunctive or other equitable relief to compel compliance.
b. A civil action shall not be commenced pursuant to this section unless the person seeking to commence the action shall, at least 30 days prior to the commencement thereof, deliver a written notice of their intention by certified mail to the Attorney General, the Commissioner of Banking and Insurance, and the intended defendant carrier.
c. If administrative proceedings are required or available to determine the legality of a carrier's conduct in a civil action pursuant to this section, the court may remit the parties to those proceedings, except where immediate and irreparable damage will likely result, which proceedings shall be conducted in accordance with the provisions of the "Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.). In so remitting, the court may grant temporary equitable relief as necessary. In so remitting the court shall retain jurisdiction of the action pending completion thereof for the purpose of determining whether the administrative findings made in the proceedings are supported by substantial evidence and the commissioner's action in the administrative proceeding is in conformance with this section.
d. In any action brought pursuant to this section, the court may:
(1) in appropriate cases in which the prevailing party achieved reasonable success on the merits, award to the prevailing party reasonable counsel and expert witness fees. The fees shall be based on the number of hours reasonably spent and a reasonable hourly rate for the counsel or expert in the action, taking into account the prevailing rate in the venue of the action and the skill and experience of the counsel or expert;
(2) apply the doctrines of collateral estoppel and res judicata to prevent multiplicity of suits;
(3) on the motion of any party, or on its own motion, dismiss any action brought pursuant to this section which on its face appears to be patently frivolous, harassing, or wholly lacking in merit, provided that an action commenced pursuant to this section shall not be dismissed without the express consent of the court in which the action was filed; and
(4) grant temporary and permanent equitable relief, including the imposition of such conditions as may be necessary to protect the interest of the public from violations against any relevant statute or promulgated regulation.
e. Any penalties imposed may be collected with costs in a summary proceeding pursuant to the "Penalty Enforcement Law of 1999," P.L.1999, c.274 (C.2A:58-10 et seq.) All civil penalties collected pursuant to this section shall be collected on behalf of the State and shall be deposited into the "Health Care Quality Enforcement Fund" established pursuant to section 3 of this act.
f. Pursuit of any remedy specified in this section shall not preclude the pursuit of any other remedy provided by any other law. Administrative and judicial remedies provided in this section may be pursued simultaneously.
2. a. Whenever the Commissioner of Banking and Insurance finds that a carrier has violated any provision of Title 17 or 26 of the Revised Statutes, Title 17B of the New Jersey Statutes, or any law subsequently enacted for the governance of carriers or health benefits plans, or any rule, regulation, or order promulgated pursuant thereto, the commissioner may:
(1) issue an order in accordance with subsection b. of this section;
(2) bring a civil action in accordance with subsection c. of this section;
(3) levy a civil administrative penalty in accordance with subsection d. of this section; or
(4) bring an action for a civil penalty in accordance with subsection e. of this section.
b. Whenever the commissioner finds that a carrier has violated any provision of Titles 17 or 26 of the Revised Statutes, Title 17B of the New Jersey Statutes, or any laws subsequently enacted for the governance of carriers or health benefits plans, or any rule, regulation, or order adopted pursuant thereto, the commissioner may issue an order specifying the section of the statute, rule, regulation, or order of which the carrier is in violation, citing the action which constituted the violation, ordering abatement of the violation, and giving notice to the carrier of the right to a hearing on the matters contained in the order. The carrier shall have 20 days from receipt of the order within which to deliver to the commissioner a written request for a hearing. The order shall be effective upon receipt and a carrier to whom an order is directed shall comply with the order immediately. A request for a hearing shall not automatically stay the effect of the order.
c. The commissioner may institute an action or proceeding in the Superior Court for injunctive and other relief, including the appointment of a receiver for any violation of Titles 17 or 26 of the Revised Statutes, Title 17B of the New Jersey Statutes, or any law subsequently enacted for the governance of carriers or health benefits plans, or any rule, regulation, or order adopted pursuant thereto and the court may proceed in the action in a summary manner. In any proceeding the court may grant temporary or interlocutory relief, which may include: (1) a temporary or permanent injunction; (2) an assessment of the carrier for the costs of any investigation, inspection, or monitoring survey which led to the establishment of the violation, and for the reasonable costs of preparing and litigating the case under this subsection; or (3) both.
d. The commissioner is authorized to assess a civil administrative penalty of not more than $50,000 for each violation of Title 17 or 26 of the Revised Statutes, Title 17B of the New Jersey Statutes or any law subsequently enacted for the governance of carriers or health benefits plans or any rule, regulation, or order adopted pursuant thereto, provided that each day during which the violation continues shall constitute an additional, separate, and distinct offense. An assessment shall not be levied pursuant to this subsection until after the carrier has been notified by certified mail or personal service. The notice shall include a reference to the section of the statute, rule, regulation, or order alleged to constitute a violation, a statement of the amount of the civil administrative penalty to be imposed, and a statement of the carrier's right to a hearing. The carrier shall have 20 days from receipt of the notice to make a written request to the commissioner for a hearing. After the hearing and upon finding that a violation has occurred, the commissioner may issue a final order after assessing the amount of the civil administrative penalty specified in the notice. If no hearing is requested, the notice shall become a final order after the expiration of the 20-day period. Payment of the assessment is due when a final order is issued or the notice becomes a final order. The commissioner may reduce a civil administrative penalty assessed against a carrier under this subsection in an amount the commissioner determines appropriate, if the carrier complies with actions specified in writing by the commissioner to address the violation underlying the assessment of the civil administrative penalty.
e. A carrier who violates any provision of Title 17 or 26 of the Revised Statutes, Title 17B of the New Jersey Statutes, or any law subsequently enacted for the governance of carriers or health benefits plans, or any rule, regulation, or order adopted pursuant thereto shall be liable to a penalty of not more than $50,000 for each day that the carrier is in violation, to be collected in a civil action commenced by the commissioner.
f. In addition to the remedies and penalties for violations of any statute, rule, regulation or order as set forth in subsections b. through e. of this section, a carrier who violates an administrative order issued pursuant to subsection b. of this section, or a court order issued pursuant to subsection c. of this section, or who fails to pay a civil penalty in full pursuant to subsections d. or e. of this section is subject upon order of a court to a civil penalty not to exceed $100,000 per day of any violation.
g. Any penalty imposed pursuant to this section may be collected with costs in a summary proceeding pursuant to the "Penalty Enforcement Law of 1999," P.L.1999, c.274 (C.2A:58-10 et seq.). The Superior Court shall have jurisdiction to enforce the provisions of the "Penalty Enforcement Law of 1999" in connection with this subsection.
h. Pursuit of any remedy specified in this section shall not preclude the pursuit of any other remedy provided by any other law. Administrative and judicial remedies provided in this section may be pursued simultaneously.
3. There is established in the Department of Banking and Insurance a nonlapsing revolving fund to be known as the "Health Care Quality Enforcement Fund." The commissioner shall maintain the fund and use the monies in the fund to support enforcement actions pursuant to this act. The commissioner shall retain in the fund all interest on monies deposited in the fund and shall deposit into the fund all penalties collected and any recovery of costs incurred pursuant to this act.
4. This act shall take effect immediately.
STATEMENT
This bill supplements the "Health Care Quality Act," P.L.1997, c.192 (C.26:2S-1 et seq.), to provide additional means of enforcing statutory requirements governing private health insurance carriers or health benefits plans (hereinafter referred to as "health benefits laws").
The bill would:
(1) provide certain private causes of action for violations of Title 17 or 26 of the Revised Statutes, Title 17B of the New Jersey Statutes, or any subsequently enacted health benefits laws;
(2) expand the options available to the Commissioner of Banking and Insurance to enforce compliance with health benefits laws through administrative and judicial actions; and
(3) establish a fund in the Department of Banking and Insurance (DOBI) to support enforcement actions pursuant to the bill.
Specifically, the bill provides as follows:
· A covered person, health care provider, or professional organization representing a health care provider, may bring an action against a carrier for a civil penalty of not more than $50,000 for each day that the carrier is in violation of health benefits laws or for injunctive or other equitable relief to compel compliance with those laws. The action may be commenced upon an allegation that a carrier is in violation, either continuously or intermittently, of health benefits laws and that there is a likelihood that the violation will recur in the future. The person bringing the action must provide 30 days prior written notice to the Attorney General, DOBI, and the intended defendant carrier.
· In addition to the current statutory enforcement powers afforded to DOBI to enforce health benefits laws, the bill provides the department with an expanded range of options, including the authority to issue an order to abate a violation, bring a civil action for injunctive or other relief, impose a civil administrative penalty of not more than $50,000 per day, or bring an action for a civil penalty of not more than $50,000 per day. A carrier who fails to comply with an order or pay a penalty is also subject upon order of a court to a civil penalty not to exceed $100,000 per day.
· Finally, all civil penalties collected pursuant to private causes of action and enforcement actions by the Commissioner of Banking and Insurance pursuant to the bill are to be deposited into a nonlapsing revolving fund, established in DOBI, to be known as the "Health Care Quality Enforcement Fund." The commissioner is to: maintain the fund; use the monies therein to support enforcement actions pursuant to the bill; retain in the fund all interest on monies deposited in the fund; and deposit into the fund all penalties collected and any recovery of costs incurred pursuant to the bill.
