December 23, 2020
Albany, NY

Governor Cuomo Announces New Guidance from Department of Financial Services to Further Grow Hospital Capacity

Governor Cuomo Announces New Guidance from Department of Financial Services to Further Grow Hospital Capacity

Insurers Directed to Suspend Preauthorization and Administrative Requirements During COVID-19

Relief will Help Hospitals Maintain Sufficient Bed Capacity to Treat COVID-19 Patients

Guidance Developed in Collaboration with Insurance Industry and Hospitals

Governor Andrew M. Cuomo today announced the issuance by the Department of Financial Services of a circular letter, developed in collaboration with the insurance industry and hospitals, directing insurers to suspend certain preauthorization and administrative requirements to help hospitals implement New York State's "surge and flex" protocol. The protocol, which mandates all hospitals to begin expanding their bed capacity to prepare for a COVID-19 surge, is part of the winter COVID-19 Plan recently announced by the Governor. With today's action, hospitals will be ready to quickly transfer patients between hospitals and, when appropriate, discharge patients to skilled nursing facilities or their homes to increase bed capacity and balance patient load. Similar regulatory relief was granted in March during the first COVID-19 surge in the state.

"With the vaccine in hand, the light at the end of the tunnel is in sight, but how fast we get there is all based on our actions," Governor Cuomo said. "After what we saw in the spring, we know that preventing hospitals from becoming overwhelmed needs to remain a top priority moving forward. With New York's innovative 'Surge and Flex' protocol now in place, this new guidance will help streamline hospitals' ability to quickly transfer patients between facilities, increase bed capacity and balance patient load."

The circular letter directs insurers to suspend the following requirements for 60 days:

  • Preauthorization review for urgent or non-elective scheduled inpatient surgeries, hospital admissions and transfers between hospitals;
  • Preauthorization review for inpatient rehabilitation and home health care services following an inpatient hospital admission; and
  • Preauthorization review for inpatient mental health services following an inpatient hospital admission.

Department of Financial Services Superintendent Linda A. Lacewell said,"A temporary suspension of preauthorization and other administrative requirements provides necessary flexibility for hospitals during this critical time to maintain sufficient hospital bed capacity. We encourage insurance companies and hospitals to continue to work together to ensure that COVID-19 patients receive the care they need."

New York State Department of Health Commissioner Dr. Howard Zucker said, "As we work to implement Governor Cuomo's Winter Plan, these regulatory changes will help keep hospital space available for everyone who needs it and speed the delivery of services. Though New Yorkers have done a great job slowing the spread, COVID-19 continues to be a threat, and it is essential that patients get the care they need as quickly as possible."

Insurers are reminded that they are prohibited from denying emergency department and inpatient hospital treatment provided during the declared state of emergency for diagnosed or suspected COVID-19 cases as not medically necessary on retrospective review. In addition, hospitals should use their best efforts to continue to provide insurers with notifications, including information necessary for the insurer to assist in coordinating care and discharge planning of emergency hospital admissions.

The Department of Financial Services also strongly encourages third party administrators to apply the provisions of the circular letter to their administrative services arrangements with self-funded plans to ensure that hospitals can implement the state's "surge and flex" protocol.

Read a copy of the circular letter on the DFS website.


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