New York Senate Bill S05209

New York 2025-2026 Regular Session

• Introduced: 2/19/25
• Refer: 2/19/25
• Refer: 1/7/26

Caption

Changes the lookback period for insurance overpayment recovery from health care providers from twenty-four months to twelve months.

Summary

This bill amends New York Insurance Law section 3224-b to shorten the time period a health plan has to begin recovering an alleged overpayment from a health care provider. Under current law, a health plan may not initiate overpayment recovery efforts more than 24 months after the original payment was received; this bill reduces that lookback period to 12 months. The bill also preserves existing exceptions for cases involving a reasonable belief of fraud, intentional misconduct, or abusive billing, as well as recoveries required by self-insured plans or certain government programs. The measure further keeps intact the rule allowing a health plan to defend against or offset a provider’s underpayment claim using overpayments going back as far as the claimed underpayment. It defines “abusive billing” as a pattern of claims inconsistent with sound fiscal, business, or medical practices over time. The bill would take effect 30 days after becoming law.

Impact

The bill would directly change the insurance law governing post-payment audits and recoupment by health plans, reducing providers’ exposure to retroactive overpayment demands from two years to one year in most cases. Health insurers and managed care plans would need to identify and pursue recovery issues more quickly, while hospitals, physicians, and other health care providers would gain greater certainty and finality in payment reconciliation. The existing statutory exceptions for fraud, abusive billing, self-insured plans, and certain public coverage programs remain unchanged.

Sentiment

The available context suggests the bill is aimed at protecting health care providers from prolonged and delayed recoupment activity, which generally tends to be viewed favorably by provider groups. Because there are no committee transcripts or recorded votes provided, there is no direct evidence of formal support or opposition in the legislative record included here. The bill’s amendment and recommittal indicate it was actively considered and revised, but the overall tone of the text is straightforward and remedial rather than controversial.

Contention

The main point of contention is likely the balance between provider certainty and insurer audit/recovery rights. Health care providers would benefit from a shorter lookback period that limits surprise recoupments long after services were billed and paid, while health plans may argue that 12 months is too short to detect coding errors, coordination-of-benefits issues, or other overpayments. The exceptions for fraud, intentional misconduct, abusive billing, and government/self-insured plans soften that restriction, but the core debate is whether one year is enough time for insurers to identify and recover improper payments.