Bill Text: NY S00087 | 2023-2024 | General Assembly | Introduced
Bill Title: Enacts the Health Care Tax Reform Act; eliminates certain taxes and assessments on health insurance.
Spectrum: Partisan Bill (Republican 2-0)
Status: (Introduced) 2024-01-03 - REFERRED TO INSURANCE [S00087 Detail]
Download: New_York-2023-S00087-Introduced.html
STATE OF NEW YORK ________________________________________________________________________ 87 2023-2024 Regular Sessions IN SENATE (Prefiled) January 4, 2023 ___________ Introduced by Sen. GALLIVAN -- read twice and ordered printed, and when printed to be committed to the Committee on Insurance AN ACT to amend the financial services law, the tax law and the public health law, in relation to enacting the Health Care Tax Reform Act The People of the State of New York, represented in Senate and Assem- bly, do enact as follows: 1 Section 1. This act shall be known and may be cited as the "Health 2 Care Tax Reform Act". 3 § 2. Legislative findings. The Legislature hereby finds that: 4 (a) The affordability of health care and health insurance is extremely 5 important in ensuring that the maximum number of New York State resi- 6 dents can obtain high quality affordable health care; 7 (b) Health care and health insurance are currently subject to several 8 taxes that directly and indirectly increase the cost of health insurance 9 coverage, including an annual flat tax on all privately insured people 10 in New York State called the covered lives assessment that raises the 11 costs to health plans by $1.1 Billion, a 9.63% sales tax surcharge on 12 certain hospital based health services that costs consumers $3.6 13 Billion, a 1.75% flat tax on all commercial health insurance policies 14 that costs consumers $350 Million, and a gross receipts tax on insurance 15 companies called a section 206 assessment that costs health plans $149 16 Million a year; 17 (c) Collectively, the taxes on health care and health insurance cost 18 consumers a total of over $5 Billion in 2018, which exceeds the total 19 amount of taxes paid by corporations through the franchise taxes and 20 exceeds all other types of taxes except for personal income taxes and 21 general sales taxes; and 22 (d) The taxes on health care and health insurance are fundamentally 23 regressive taxes because the taxes are unrelated to a consumer's wealth 24 or ability to pay, directly impact hospitalization costs at a time when EXPLANATION--Matter in italics (underscored) is new; matter in brackets [] is old law to be omitted. LBD00606-01-3S. 87 2 1 consumers are facing some of their greatest health care challenges, 2 directly increase the cost of health insurance, and are counterproduc- 3 tive to the public policy objective of making health insurance as 4 affordable as possible. 5 § 3. Section 206 of the financial services law is amended by adding a 6 new subsection (g) to read as follows: 7 (g) For the fiscal year commencing on April first, two thousand twen- 8 ty-three, the commissioner shall only collect eighty per centum of any 9 assessments collected pursuant to this section in the fiscal year 10 commencing on April first, two thousand twenty-four, and provided 11 further, however, that for the fiscal year commencing on April first, 12 two thousand twenty-six, the commissioner shall only collect sixty per 13 centum of any assessments collected pursuant to this section in the 14 fiscal year commencing on April first, two thousand twenty-four, and 15 provided further, however, that for the fiscal year commencing on April 16 first, two thousand twenty-seven, the commissioner shall only collect 17 forty per centum of any assessments collected pursuant to this section 18 in the fiscal year commencing on April first, two thousand twenty-four, 19 and provided further, however, that for the fiscal year commencing on 20 April first, two thousand twenty-eight, the commissioner shall only 21 collect twenty per centum of any assessments collected pursuant to this 22 section in the fiscal year commencing on April first, two thousand twen- 23 ty-four, and provided further, however, that for the fiscal year 24 commencing on April first, two thousand twenty-nine, no such assessment 25 under this section shall be collected. 26 § 4. Section 1502-a of the tax law, as amended by section 2 of part 27 B-1 of chapter 57 of the laws of 2009 and as further amended by section 28 104 of part A of chapter 62 of the laws of 2011, is amended to read as 29 follows: 30 § 1502-a. Tax on non-life insurance corporations. (a) In lieu of the 31 tax imposed by section fifteen hundred one of this article, every domes- 32 tic insurance corporation, every foreign insurance corporation and every 33 alien insurance corporation, other than such corporations transacting 34 the business of life insurance, (1) authorized to transact business in 35 this state under a certificate of authority from the superintendent of 36 financial services[,] or (2) that is a risk retention group as defined 37 in subsection (n) of section five thousand nine hundred two of the 38 insurance law, [or (3) that is a health maintenance organization39required to obtain a certificate of authority under article forty-four40of the public health law,] shall, for the privilege of exercising corpo- 41 rate franchises or for carrying on business in a corporate or organized 42 capacity within this state, and in addition to any other taxes imposed 43 for such privilege, pay a tax on all gross direct premiums, less return 44 premiums thereon, written on risks located or resident in this state. 45 The tax imposed by this section shall be computed in the manner set 46 forth in subdivision (a) of section fifteen hundred ten of this article 47 as such subdivision applied to taxable years beginning before January 48 first, two thousand three, except that the rate of tax imposed by this 49 section shall be [one and seventy-five hundredths percent on all gross50direct premiums, less return premiums thereon, for accident and health51insurance contracts, including contracts with health maintenance organ-52izations for health services, and] two percent on all [other] such 53 premiums except accident and health insurance contracts, including 54 contracts with health maintenance organizations for health services. 55 (b) In lieu of the tax imposed by section fifteen hundred one of this 56 article, every domestic insurance corporation, every foreign insuranceS. 87 3 1 corporation and every alien insurance corporation, other than such 2 corporations transacting the business of life insurance that is a health 3 maintenance organization required to obtain a certificate of authority 4 under article forty-four of the public health law, shall, for the privi- 5 lege of exercising corporate franchises or for carrying on business in a 6 corporate or organized capacity within this state, and in addition to 7 any other taxes imposed for such privilege, pay a tax on all gross 8 direct premiums, less return premiums thereon, written on risks located 9 or resident in this state. The tax imposed by this section shall be 10 computed in the manner set forth in subdivision (a) of section fifteen 11 hundred ten of this article as such subdivision applied to taxable years 12 beginning before January first, two thousand three, except that the rate 13 of tax imposed by this section shall be one and seventy-five hundredths 14 percent on all gross direct premiums, less return premiums thereon, for 15 accident and health insurance contracts, including contracts with health 16 maintenance organizations for health services, provided, however, that 17 for the taxable year beginning January first, two thousand twenty-five, 18 the percentage shall be one and four tenths percent, and provided 19 further, however, that for the taxable year beginning January first, two 20 thousand twenty-six, the percentage shall be one and five hundredths 21 percent, and provided further, however, that for the taxable year begin- 22 ning January first, two thousand twenty-seven, the percentage shall be 23 seven tenths of one percent, and provided further, however, that for the 24 taxable year beginning January first, two thousand twenty-eight, the 25 percentage shall be thirty-seven hundredths of one percent, and provided 26 further, however, that for the taxable years beginning on and after 27 January first, two thousand twenty-nine, no such tax shall be imposed. 28 (c) All the other provisions in section fifteen hundred ten of this 29 article as amended from time to time, other than subdivision (b) of such 30 section, shall apply to the tax imposed by this section. In no event 31 shall the tax imposed under this section be less than two hundred fifty 32 dollars. 33 § 5. Subdivision 2 of section 2807-j of the public health law, as 34 amended by section 41 of part B of chapter 58 of the laws of 2005 and 35 paragraphs (b), (c), (d), and (e) as amended by section 50 of part B of 36 chapter 58 of the laws of 2009, is amended to read as follows: 37 2. (a) The total percentage allowance for any period during the period 38 January first, nineteen hundred ninety-seven through December thirty- 39 first, nineteen hundred ninety-nine and on and after January first, two 40 thousand, for a designated provider of services applicable to a payor 41 shall be determined in accordance with this subdivision and applied to 42 net patient service revenues. 43 (b) The total percentage allowance for each payor, other than govern- 44 mental agencies, or health maintenance organizations for services 45 provided to subscribers eligible for medical assistance pursuant to 46 title eleven of article five of the social services law, or approved 47 organizations for services provided to subscribers eligible for the 48 family health plus program pursuant to title eleven-D of article five of 49 the social services law, and other than payments for a patient that has 50 no third-party coverage in whole or in part for services provided by a 51 designated provider of services, shall be: 52 (i) the sum of (A) eight and eighteen-hundredths percent, provided, 53 however, that for services provided on and after July first, two thou- 54 sand three, the percentage shall be eight and eighty-five hundredths 55 percent, and further provided that for services provided on and after 56 January first, two thousand six, the percentage shall be eight and nine-S. 87 4 1 ty-five hundredths percent, and further provided that for services 2 provided on and after April first, two thousand nine, the percentage 3 shall be nine and sixty-three hundredths percent, and further provided 4 that for services provided on and after April first, two thousand twen- 5 ty-four, the percentage shall be twenty-two and sixty-one hundredths 6 percent, and further provided that for services provided on and after 7 April first, two thousand twenty-five, the percentage shall be sixteen 8 and ninety-six hundredths percent, and further provided that for 9 services provided on and after April first, two thousand twenty-six, the 10 percentage shall be eleven and thirty-one hundredths percent, and 11 further provided that for services provided on and after April first, 12 two thousand twenty-seven, the percentage shall be five and sixty-five 13 hundredths percent, and further provided that for services provided on 14 and after April first, two thousand twenty-eight, the percentage shall 15 be zero percent, plus (B) twenty-four percent, provided, however, that 16 for services provided on and after July first, two thousand three, the 17 percentage shall be twenty-five and ninety-seven hundredths percent, and 18 further provided that for services provided on and after January first, 19 two thousand six, the percentage shall be twenty-six and twenty-six 20 hundredths percent, and further provided that for services provided on 21 and after April first, two thousand nine, the percentage shall be twen- 22 ty-eight and twenty-seven hundredths percent, and further provided that 23 for services provided on and after April first, two thousand twenty- 24 four, the percentage shall be twenty-two and sixty-one hundredths 25 percent, and further provided that for services provided on and after 26 April first, two thousand twenty-five, the percentage shall be sixteen 27 and ninety-six hundredths percent, and further provided that for 28 services provided on and after April first, two thousand twenty-six, the 29 percentage shall be eleven and thirty-one hundredths percent, and 30 further provided that for services provided on and after April first, 31 two thousand twenty-seven, the percentage shall be five and sixty-five 32 hundredths percent, and further provided that for services provided on 33 and after April first, two thousand twenty-eight, the percentage shall 34 be zero percent, and plus (C) for a specified third-party payor as 35 defined in subdivision one-a of section twenty-eight hundred seven-s of 36 this article the percentage allowance applicable for a general hospital 37 for inpatient hospital services pursuant to subdivision two of section 38 twenty-eight hundred seven-s of this article; 39 (ii) unless (A) an election in accordance with paragraph (a) of subdi- 40 vision five of this section to pay the allowance directly to the commis- 41 sioner or the commissioner's designee is in effect for a third-party 42 payor, and in addition (B) for a specified third-party payor an election 43 to pay the assessment in accordance with section twenty-eight hundred 44 seven-t of this article is in effect. 45 (c) If an election in accordance with subdivision five of this section 46 is in effect for a third-party payor and in addition in accordance with 47 section twenty-eight hundred seven-t of this article for a specified 48 third-party payor, the total percentage allowance factor shall be 49 reduced to eight and eighteen-hundredths percent, provided, however, 50 that for services provided on and after July first, two thousand three 51 the total percentage allowance factor shall be reduced to eight and 52 eighty-five hundredths percent, and further provided that for services 53 provided on and after January first, two thousand six, the total 54 percentage allowance factor shall be reduced to eight and ninety-five 55 hundredths percent, and further provided that for services provided on 56 and after April first, two thousand nine, the total percentage allowanceS. 87 5 1 factor shall be reduced to nine and sixty-three hundredths percent and 2 further provided that for services provided on and after April first, 3 two thousand twenty-four, the percentage shall be seven and seventy-one 4 hundredths percent, and further provided that for services provided on 5 and after April first, two thousand twenty-five, the percentage shall be 6 five and seventy-nine hundredths percent, and further provided that for 7 services provided on and after April first, two thousand twenty-six, the 8 percentage shall be three and eighty-six hundredths percent, and further 9 provided that for services provided on and after April first, two thou- 10 sand twenty-seven, the percentage shall be one and ninety-three 11 hundredths percent, and further provided that for services provided on 12 and after April first, two thousand twenty-eight, the percentage shall 13 be zero percent. 14 (d) The total percentage allowance for payments by governmental agen- 15 cies, as determined in accordance with paragraphs (a) and (a-1) of 16 subdivision one of section twenty-eight hundred seven-c of this article 17 as in effect on December thirty-first, nineteen hundred ninety-six, or 18 health maintenance organizations for services provided to subscribers 19 eligible for medical assistance pursuant to title eleven of article five 20 of the social services law, or approved organizations for services 21 provided to subscribers eligible for the family health plus program 22 pursuant to title eleven-D of article five of the social services law, 23 shall be five and ninety-eight-hundredths percent, provided, however, 24 that for services provided on and after July first, two thousand three 25 the total percentage allowance shall be six and forty-seven hundredths 26 percent, and further provided that for services provided on and after 27 January first, two thousand six, the total percentage allowance shall be 28 six and fifty-four hundredths percent, and further provided that for 29 services provided on and after April first, two thousand nine, the total 30 percentage allowance shall be seven and four hundredths percent and 31 further provided that for services provided on and after April first, 32 two thousand twenty-four, the percentage shall be five and sixty-three 33 hundredths percent, and further provided that for services provided on 34 and after April first, two thousand twenty-five, the percentage shall be 35 four and twenty-two hundredths percent, and further provided that for 36 services provided on and after April first, two thousand twenty-six, the 37 percentage shall be two and eighty-two hundredths percent, and further 38 provided that for services provided on and after April first, two thou- 39 sand twenty-seven, the percentage shall be one and forty-one hundredths 40 percent, and further provided that for services provided on and after 41 April first, two thousand twenty-eight, the percentage shall be zero 42 percent. 43 (e) The total percentage allowance for payments for services provided 44 by designated providers of services for which there is no third-party 45 coverage in whole or in part shall be eight and eighteen-hundredths 46 percent, provided, however, that for services provided on and after July 47 first, two thousand three the total percentage allowance shall be eight 48 and eighty-five hundredths percent, and further provided that for 49 services provided on and after January first, two thousand six, the 50 total percentage allowance shall be eight and ninety-five hundredths 51 percent, and further provided that for services provided on and after 52 April first, two thousand nine, the total percentage allowance shall be 53 nine and sixty-three hundredths percent and further provided that for 54 services provided on and after April first, two thousand twenty-four, 55 the percentage shall be seven and seventy-one hundredths percent, and 56 further provided that for services provided on and after April first,S. 87 6 1 two thousand twenty-five, the percentage shall be five and seventy-nine 2 hundredths percent, and further provided that for services provided on 3 and after April first, two thousand twenty-six, the percentage shall be 4 three and eighty-six hundredths percent, and further provided that for 5 services provided on and after April first, two thousand twenty-seven, 6 the percentage shall be one and ninety-three hundredths percent, and 7 further provided that for services provided on and after April first, 8 two thousand twenty-eight, the percentage shall be zero percent. This 9 paragraph shall not apply to patient deductibles and coinsurance 10 amounts. 11 (f) The total percentage allowance for patient deductibles and coinsu- 12 rance amounts shall be the same percentage allowance applicable to 13 payments by the primary third-party payor covering the patient in each 14 case determined in accordance with paragraphs (a), (b) and (c) of this 15 subdivision. 16 (g) The total percentage allowance for secondary third-party payors 17 under coordination of benefits principles shall be the same percentage 18 allowance applicable to payments by the primary third-party payor in the 19 case determined in accordance with paragraphs (a), (b) and (c) of this 20 subdivision. 21 § 6. Subdivision 2 of section 2807-s of the public health law, as 22 added by chapter 639 of the laws of 1996, subparagraph (ii) of paragraph 23 (b) as amended by chapter 1 of the laws of 1999, paragraph (c) as 24 amended by section 15 of part A-3 of chapter 62 of the laws of 2003, 25 subparagraph (ii) of paragraph (c) as amended and subparagraph (iii) of 26 paragraph (c) as added by section 31 of part B of chapter 58 of the laws 27 of 2005, and subparagraph (iv) of paragraph (c) as added by section 21 28 of part A of chapter 58 of the laws of 2007, is amended to read as 29 follows: 30 2. (a) The regional percentage allowance for any period during the 31 period January first, nineteen hundred ninety-seven through December 32 thirty-first, nineteen hundred ninety-nine for all general hospitals in 33 the region applicable to a specified third-party payor, and applicable 34 to related patient coinsurance and deductible amounts and to secondary 35 third-party payors under coordination of benefits principles, shall be 36 the following, and shall be applied to inpatient hospital net patient 37 service revenues: 38 (b) the result expressed as a percentage of: 39 (i) for each region, the amount allocated to the region in accordance 40 with subdivision six of this section, divided by 41 (ii) the total estimated nineteen hundred ninety-six general hospital 42 inpatient revenue of all general hospitals in the region, excluding (A) 43 an estimate of revenue from services provided to beneficiaries of title 44 XVIII of the federal social security act (medicare), (B) an estimate of 45 revenue from services provided to patients eligible for payments by 46 governmental agencies, patients eligible for payments pursuant to the 47 comprehensive motor vehicle insurance reparations act, the workers' 48 compensation law, the volunteer firefighters' benefit law, and the 49 volunteer ambulance workers' benefit law, and self-pay patients, (C) 50 from general hospitals providing graduate medical education in the 51 aggregate an amount equal to the amount specified in subparagraph (i) of 52 this subdivision, other than the components of such amount allocable to 53 payors specified in clause (B) of this subparagraph, and (D) an estimate 54 of revenue reductions related to negotiated reimbursement in nineteen 55 hundred ninety-seven with specified third-party payors which shall be a 56 uniform statewide percentage estimated reduction.S. 87 7 1 (c) (i) The regional percentage allowance for the periods January 2 first, two thousand through June thirtieth, two thousand three, for all 3 general hospitals in the region applicable to specified third-party 4 payors, and applicable to related patient coinsurance and deductible 5 amounts, shall be the same regional percentage allowance calculated 6 pursuant to paragraph (b) of this subdivision for the period January 7 first, nineteen hundred ninety-nine through December thirty-first, nine- 8 teen hundred ninety-nine. 9 (ii) The regional percentage allowance for the periods July first, two 10 thousand three through December thirty-first, two thousand five, for all 11 general hospitals in the region applicable to specified third-party 12 payors, and applicable to related patient coinsurance and deductible 13 amounts, shall be the same regional percentage allowance calculated 14 pursuant to paragraph (b) of this subdivision for the period January 15 first, nineteen hundred ninety-nine through December thirty-first, nine- 16 teen hundred ninety-nine multiplied by one hundred eight and nineteen 17 hundredths percent. 18 (iii) The regional percentage allowance for the periods January first, 19 two thousand six through June thirtieth, two thousand seven, for all 20 general hospitals in the region applicable to specified third-party 21 payors, and applicable to related patient coinsurance and deductible 22 amounts, shall be the same regional percentage allowance calculated 23 pursuant to subparagraph (ii) of this paragraph for the period January 24 first, two thousand five through December thirty-first, two thousand 25 five multiplied by one hundred one and thirteen hundredths percent. 26 (iv) The regional percentage allowance for periods [on and after] July 27 first, two thousand seven through March thirtieth, two thousand twenty- 28 four, for all general hospitals in the region applicable to specified 29 third-party payors, and applicable to related patient coinsurance and 30 deductible amounts, shall be the same regional percentage allowance 31 calculated pursuant to subparagraph (iii) of this paragraph for the 32 period January first, two thousand six through June thirtieth, two thou- 33 sand seven. 34 (v) The regional percentage allowance for periods April first, two 35 thousand twenty-four through March thirtieth, two thousand twenty-five, 36 for all general hospitals in the region applicable to specified third- 37 party payors, and applicable to related patient coinsurance and deduct- 38 ible amounts, shall be the same regional percentage allowance calculated 39 pursuant to paragraph (b) of this subdivision for the period January 40 first, nineteen hundred ninety-nine through December thirty-first, nine- 41 teen hundred ninety-nine multiplied by ninety-seven and seventy-one 42 hundredths percent. 43 (vi) The regional percentage allowance for periods April first, two 44 thousand twenty-five through March thirtieth, two thousand twenty-six, 45 for all general hospitals in the region applicable to specified third- 46 party payors, and applicable to related patient coinsurance and deduct- 47 ible amounts, shall be the same regional percentage allowance calculated 48 pursuant to paragraph (b) of this subdivision for the period January 49 first, nineteen hundred ninety-nine through December thirty-first, nine- 50 teen hundred ninety-nine multiplied by seventy-three and twenty-nine 51 hundredths percent. 52 (vii) The regional percentage allowance for periods April first, two 53 thousand twenty-six through March thirtieth, two thousand twenty-seven, 54 for all general hospitals in the region applicable to specified third- 55 party payors, and applicable to related patient coinsurance and deduct- 56 ible amounts, shall be the same regional percentage allowance calculatedS. 87 8 1 pursuant to paragraph (b) of this subdivision for the period January 2 first, nineteen hundred ninety-nine through December thirty-first, nine- 3 teen hundred ninety-nine multiplied by forty-eight and eighty-six 4 hundredths percent. 5 (viii) The regional percentage allowance for periods April first, two 6 thousand twenty-seven through March thirtieth, two thousand twenty- 7 eight, for all general hospitals in the region applicable to specified 8 third-party payors, and applicable to related patient coinsurance and 9 deductible amounts, shall be the same regional percentage allowance 10 calculated pursuant to paragraph (b) of this subdivision for the period 11 January first, nineteen hundred ninety-nine through December thirty- 12 first, nineteen hundred ninety-nine multiplied by twenty-four and 13 forty-three hundredths percent. 14 § 7. This act shall take effect immediately; provided, however, that 15 the amendments to section 2807-j of the public health law made by 16 section five of this act shall not affect the expiration of such section 17 and shall be deemed to expire therewith; provided further, however, that 18 the amendments to section 2807-s of the public health law made by 19 section six of this act shall not affect the expiration of such section 20 and shall be deemed to expire therewith.
