STATEMENT TO

[First Reprint]

ASSEMBLY COMMITTEE SUBSTITUTE FOR

ASSEMBLY Nos. 2420, 2623 and 2668

with Assembly Floor Amendments

(Proposed By Assemblywoman VANDERVALK)

ADOPTED: JUNE 5, 1997

      This amendment to subsection b. of section 9 of this committee substitute concerns the prohibition in a contract between a participating health care provider and a carrier offering a managed care plan against financial incentives for the provider to withhold medically necessary covered health care services.                 The amendment provides that the medical necessity of covered health care services shall be determined in accordance with section 6 of the substitute, except that nothing in this subsection shall be construed to limit the use of capitated payment or reimbursement arrangements between a carrier and a health care provider.