HEALTH LAW SUPPLEMENT Autumn 2019

New York now allows credit card surcharges. By a decision of the Court of Appeals, the State now allows credit card surcharges, Expressions Hair Design v Schneiderman,, No 100, 10/23/2018. New York is now among the majority of states that allow merchants to charge customers a surcharge for credit card fees when payment is made for goods or services by credit or debit card. Prior to the change, merchants were allowed only to charge discounts for cash payments (confusing, but think of how gas stations advertised prices). The Court reinterpreted General Business Law, Section 518, to now allow credit card surcharges as long as certain consumer disclosures are made. The Court did impose a condition, that “the merchant posts the total dollar and cents price charged to credit card users.” That translates to the following operative principles according the State Attorney General: (1) consumers cannot be expected to themselves calculate credit card charges, (2) surcharges should not be listed as percentages but as a set amount; and (3) the prices for the goods or services, both with and without the surcharges, should be disclosed. Most merchants charge an additional 3-4% for credit card surcharges. The surcharges are typically called “surcharge,” “additional fee” or “extra cost.”

Patients increasingly prefer to pay by credit card or payment apps. My experience is that therapists who accept credit card payment have greater collection rates. Credit card companies, both traditional ones and newer ones such as Square, unlike payment apps such as Pay Pal, Venmo and Zelle, are HIPAA compliant (though that does not mean that the payment apps are non-secure). Based on recent experience however, some customers seem to dislike credit card surcharges perhaps because they are unaccustomed to them. If therapists decide to accept credit cards, then to comply with State law, it is advisable that: (1) wherever prices for services are listed, whether online or on brochures, in-office postings, on office policy or consent documents, two prices be listed. One would be for the service when payment is by cash or check, and another for the service when paid by credit card., e.g., “The fee for a 45 minute individual psychotherapy session is $200 when paid for by check or cash, and $208 when paid for by credit or debit card,” and (2) on invoices, statements and bills that are payable by patients, if a surcharge is imposed when payment is made by credit or debit card, then it should be separately listed, e.g., “Individual psychotherapy – $200, credit card surcharge – $8, total fee payable $208.”

A new law and legal resource to help enforce mental health parity in New York State. The recently passed Behavioral Health Insurance Parity Reforms (BHIPR) law, part of the State budget bill, will take effect on January 1, 2020. The law covers all health insurance and health benefit plans doing business in the State. It is designed to help enforce Timothy’s Law, the State’s initial mental health parity law that was passed in 2007. Among other provisions, the new law requires that insurers: cover all mental health conditions, substance use disorders and autism spectrum disorders; not require preauthorization of substance use disorder services during the initial 28 days of inpatient or outpatient treatment; not require preauthorization of inpatient psychiatric services for minors for the first 14 days; make available medical necessity criteria to insureds, prospective insureds, and in-network providers; not take adverse action in retaliation against a provider for filing a complaint, making a report, or commenting to a government body regarding policies and practices that violate the statute; post information regarding their in-network mental health providers, including whether a provider is accepting new patients; and complete a compliance report to be made public by the State Department of Financial Services.

To complement BHIPR, the State legislature created the Community Health Access to Addiction and Mental Healthcare Project (CHAMP) to concretely address the issues that patients and providers confront with insurers regarding parity for mental health care. CHAMP has an online “red flag tool” to help patients and providers identify violations of the BHIPR and encourages them to call the Project helpline for assistance, 888-614-5400.

Insurance coverage for expanded definition of “eating disorders” in New York. Both houses of the State legislature have just passed bills that require health care insurers to provide full coverage for inpatient and outpatient treatment of all “eating disorders.” The previous parity law included only “bulimia and anorexia.” Specifically, the new law expands the parity law by including a provision that “the term eating disorders means pica, rumination disorder, avoidant/restrictive food intake disorder, anorexia nervosa, bulimia nervosa, binge eating disorder, other specified feeding or eating disorder, and any other eating disorder contained in the most recent version of the diagnostic and statistical manual of mental disorders published by the American Psychiatric Association.” Justification for the bills was that the legislature believed that many insurance companies were denying coverage for eating disorders that did not fit within their narrowly interpreted definitions of anorexia and bulimia. (A1619 and S3101).

Domestic violence to be considered in equitable distribution of marital property in divorce. The NYS Senate just passed a bill that requires that judges in divorce actions must now consider any prior acts of domestic violence in distributing marital property between the divorcing spouses. With limited exceptions, marital property is any property acquired during the course of a marriage. Prior to the passage of this bill, it was left to the discretion of judges whether to consider such violence. Judges often did not, believing that only economic factors should be taken into account in dividing marital property. [6050 amending New York Domestic Relations Law 236B(5)(d)]. This change follows a national trend in which abusers are held financially and legally accountable for their actions.

INFORMATION IN THIS NEWSLETTER IS NOT LEGAL ADVICE FOR ANY PARTICULAR CLIENT OR SITUATION. CONSULT WITH AN ATTORNEY INDIVIDUALLY FOR LEGAL ADVICE REGARDING THE SPECIFICS OF YOUR SITUATION.

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