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As a healthcare practice in New York, it’s essential to stay up-to-date with regulatory changes that could impact how you manage your business. A significant amendment to the New York State Health and Mental Hygiene (HMH) Bill will take effect on October 20, 2024, and it introduces new rules around consent forms provided to the patients and how patients may pay for medical treatment. These changes could affect how your practice currently handles payments, particularly when it comes to credit cards and third-party medical loans.

The new Part O of the HMH Bill adds sections 349-G and 519-A to the New York State General Business Law. These sections impose new notice requirements and restrictions on healthcare providers regarding the use of credit cards and third-party medical installment loans to pay for healthcare services.

Key Changes In The New Rule

  1. Prohibitions on Credit Card Pre-Authorizations

Hospitals and healthcare providers are no longer allowed to require credit card pre-authorizations before providing emergency or medically necessary services. Moreover, providers cannot mandate that a credit card be kept on file as a condition for providing such services. While this doesn’t prevent keeping a credit card on file altogether, the key takeaway is that credit cards cannot be pre-authorized for payment, and patients must consent to the charge after receiving the treatment.

  1. Changes to Assistance with Medical Credit Applications

Another important change is that healthcare practices can no longer assist patients in completing applications for medical financial products like CareCredit or other medical-specific credit cards. The application process must be handled entirely by the patient without help from the healthcare provider. This includes all medical credit cards and third-party medical installment loans.

  1. Separate Consents for Treatment and Payment

The HMH bill also introduces a new section, 18-C to the New York Public Health Law, which requires separate consents from patients for both treatment and payment of services rendered. Providers must now obtain consent for payment only after the treatment has been fully discussed with and rendered to the patient. For practices that operate on a fee-for-service basis, this means discussing the cost of treatment at checkout, reminding patients of the services rendered, and only then accepting payment by credit card, cash, check, or any other method.

These changes may lead to longer conversations or delays at the front desk, as practices can no longer process automatic payments or receive prepayments before treatment is provided. It’s important to familiarize yourself with these rules to ensure compliance and avoid potential disruptions to your payment process.

These changes come into effect on October 20, 2024. They may require adjustments to your current payment practices, especially regarding the use of credit cards and third-party loans. If you have any questions about how these new regulations will affect your practice, or if you need guidance on making sure your procedures align with the law, feel free to reach out to your legal counsel for further instructions.

Staying compliant with these updates is crucial to avoiding any unnecessary legal issues as the deadline approaches.