Home » 2010 Issues » November 10, 2010 » EDU-43-10-00010-E Waivers from Corporate Practice Restrictions for Certain Entities to Provide Certain Professional Services
EDU-43-10-00010-E Waivers from Corporate Practice Restrictions for Certain Entities to Provide Certain Professional Services
11/10/10 N.Y. St. Reg. EDU-43-10-00010-E
NEW YORK STATE REGISTER
VOLUME XXXII, ISSUE 45
November 10, 2010
RULE MAKING ACTIVITIES
EDUCATION DEPARTMENT
EMERGENCY RULE MAKING
I.D No. EDU-43-10-00010-E
Filing No. 1106
Filing Date. Oct. 26, 2010
Effective Date. Oct. 26, 2010
Waivers from Corporate Practice Restrictions for Certain Entities to Provide Certain Professional Services
PURSUANT TO THE PROVISIONS OF THE State Administrative Procedure Act, NOTICE is hereby given of the following action:
Action taken:
Amendment of sections 29.18 and 59.14 of Title 8 NYCRR.
Preservation of public health and general welfare.
Specific reasons underlying the finding of necessity:
The proposed amendments to the Commissioner's regulations and the Rules of the Board of Regents implement amendments to the Education Law that authorize the Department to issue to certain entities a waiver from restrictions on corporate practice for services provided under Articles 154 and 163 of the Education Law and psychotherapy services under section 8401(2) of the Education Law and authorized and provided under Articles 131, 139 or 153 of the Education Law. Chapters 130 and 132 of the Laws of 2010 were signed on June 18, 2010 to address critical issues relating to the authority of certain entities to employ LMSWs, LCSWs, LMHCs, LMFTs, LCATs, LPs, and licensed psychologists to provide services within the scopes of practice of those professions.
The proposed regulations implement the provisions of Chapters 130 and 132, which became effective on June 18, 2010, by setting forth the requirements to be met by a qualified entity in order to receive a waiver. In order for the Department to develop, publish and review the applications required under the new law in a timely manner, the regulations must be adopted on an emergency basis.
An emergency action is necessary to ensure there is adequate time for eligible entities providing social work, psychological, and mental health practitioner services to apply for a waiver from corporate practice prohibitions under section 6503-a of the Education Law and for the application to be processed by the Office of Professions.
Subject:
Waivers from corporate practice restrictions for certain entities to provide certain professional services.
Purpose:
Allow Department to issue waivers from certain corporate practice prohibitions to qualified not-for-profit or educational corporations.
Substance of emergency rule:
The Commissioner of Education proposes to promulgate regulations to implement the provisions of section 6503-a of the Education Law. The following is a summary of the substance of the regulations:
§ 59.14 Waiver for entities providing certain professional services.
(a) Applicability. Section 6503-a of the Education Law authorizes the Department to issue a waiver for certain entities for:
(1) services provided under Articles 154 or 163 of the Education Law for which licensure would be required, or
(2) services constituting the provision of psychotherapy as defined in section 8401(2) of the Education Law and authorized and provided under article 131, 139, or 153 of the Education Law.
(b) Eligibility. To be eligible for a waiver, an entity must be in existence prior to June 18, 2010 and be either:
(1) a not-for-profit corporation formed for charitable, educational, or religious purposes or other similar purposes deemed acceptable by the Department; or
(2) an education corporation as defined in section 216-a of the Education Law.
(c) Application for a waiver.
(1) To provide the services described in subdivision (a) of this section, an entity shall have obtained a waiver from the Department no later than July 1, 2012. The Department may issue a waiver to a qualified entity after July 1, 2012, regardless of the date on which the entity was created, upon a demonstration of need for the entity's services satisfactory to the Department.
(2) Within 120 days after the posting of the application form on the Department's website, any entity described in subdivision (b) of this section providing services described in subdivision (a) of this section on or after June 18, 2010, shall submit an application for a waiver on forms prescribed by the Commissioner. Upon submission of an application for a waiver under this section, the entity may continue to operate and provide services until the Department either denies or approves the entity's application.
(3) An application for a waiver under this section shall include:
(i) the name of the entity;
(ii) evidence that the entity is either a not-for-profit corporation; or
an education corporation as defined in section 6503-a of the Education Law;
(iii) evidence of the date the entity came into existence;
(iv) the primary address, phone number, website and email address for the entity;
(v) contact information for the individual responsible for submitting the application;
(vi) the name and address of each director and officer of the entity;
(vii) a copy of the certificate of incorporation or other documentation that authorizes the entity to provide the services described in subdivision (a);
(viii) a listing of other jurisdictions in which the entity may provide the services described in subdivision (a);
(ix) the information required in paragraph (1) of subdivision (e) of this section; and
(x) an attestation by an officer authorized by the entity that:
(a) identifies the scope of services to be provided;
(b) includes a list of professions under Title 8 of the Education Law in which professional services will be provided;
(c) includes a statement that only a licensed professional, a person authorized to provide such services, or a professional entity authorized by law to provide such services shall provide services authorized under this section;
(d) the entity will comply with section 18 of the Public Health Law relating to patient access to records;
(e) the entity will make available information requested by the Department relating to the entity's eligibility for a waiver and compliance with the requirements of this section and section 6503-a of the Education Law;
(f) includes a statement as to whether any application by the entity for an operating certificate or license with another state or federal agency, political subdivision, municipal corporation, or local government agency has been granted and such operating certificate or license is currently in effect; whether such application is pending or was disapproved; whether such a certificate or license was revoked; and whether a written authorization or contract was terminated for cause by one of such agencies;
(g) the entity has adequate fiscal and financial resources to provide such services;
(h) the statements on the application are true and accurate.
(d) Entities that do not require a waiver. A waiver is not required of:
(1) any entity operated under an operating certificate appropriately issued in accordance with article sixteen, thirty-one, or thirty-two of the mental hygiene law, article twenty-eight of the public health law, or comparable procedures by a New York state or federal agency, political subdivision, municipal corporation, or local government agency or unit, in accordance with the scope of the authority of such operating certificate;
(2) a university faculty practice corporation duly incorporated pursuant to the not-for-profit corporation law;
(3) an institution of higher education authorized to provide a program leading to licensure in a profession defined under article 131, 139, 153, 154, or 163 of the Education Law, to the extent that the scope of such services is limited to the services authorized to be provided within such registered program;
(4) an institution of higher education providing counseling only to the students, staff, or family members of students and staff of such institution; or
(5) any other entity that is otherwise authorized by law to provide such services and only to the extent that services are authorized under any certificates of incorporation or such other organizing documents as may be applicable.
(e) Provision of professional services.
(1) The entity shall describe in the application the services that will be provided that would otherwise be restricted to individuals licensed or authorized under Articles 153, 154 or 163 of the Education Law. The description shall indicate the profession(s) in which services will be provided and include:
(i) An attestation that individuals authorized to practice only under supervision will receive the required supervision;
(ii) A description of whether the services will be provided by licensed or authorized individuals employed by the entity or provided through a contract with licensed professional(s) or a professional entity, as defined in Education Law section 6503-a(5); and
(iii) An attestation that the entity will verify the licensure, limited permit or other authorization of individuals and professional entities providing services as employees of or on behalf of the entity.
(2) Unless otherwise authorized by law, an entity that holds a waiver under this section shall not provide services in any profession other than those authorized in 6503-a of the Education Law and included on the application for a waiver.
(f) Attestation of moral character.
(1) Each director and officer shall submit on forms prescribed by the Commissioner an attestation regarding whether:
(i) the individual has been found guilty after trial, or pleaded guilty, no contest or nolo contendere to a crime (felony or misdemeanor) in any court;
(ii) the individual has criminal charges (felony or misdemeanor) pending in any court;
(iii) any licensing or disciplinary authority has refused to issue a license or has ever revoked, annulled, cancelled, accepted surrender of, suspended, placed on probation, or refused to renew a professional license or certificate held by the individual now or previously, or has ever fined, censured, reprimanded or otherwise disciplined the individual;
(iv) there are any pending charges against the individual in any jurisdiction for any sort of professional misconduct; or
(v) a hospital or licensed facility has restricted or terminated the individual's professional training, employment or privileges, or whether the individual has ever voluntarily resigned or withdrawn from such association to avoid imposition of such measure.
(2) Any information included in the application that indicates that a director or officer of the entity has committed an act which raises a reasonable question as to the individual's moral character shall be made in accordance with the procedures specified in Subpart 28-1 of the Rules of the Board of Regents.
(g) Review of waiver applications. The application shall not be deemed acceptable if the entity has not submitted information identified in paragraphs (c), (e), and (f). The Department may deny an application based on the failure of the applicant to submit the required information within a reasonable period of time. When, in the determination of the department, all necessary information has been received, a decision shall be made within 90 days of such determination. If the waiver application is denied, then the entity shall cease the provision of professional services as defined in section 6503-a(1)(a) of the Education Law. The determination of the Department shall be final, and a copy thereof shall be forwarded to the applicant.
(h) Waiver certificates.
(1) An entity that has been issued a waiver under this section shall apply for a waiver certificate for each setting at which the entity provides professional services in New York.
(2) The application may be made as part of the initial application for a waiver or after the Department has approved the entity for a waiver.
(3) Each waiver certificate shall display the name of the entity and the address of the site.
(4) Any entity that willfully fails to obtain a certificate of waiver for each site and/or to display the waiver certificate at each site shall be subject to the penalties set forth in section 6511 of the Education Law.
(i) Notification of changes.
(1) An entity that is issued a waiver pursuant to section 6503-a of the Education Law shall notify the Department within 60 days of any change in the information supplied to the department, including but not limited to a change in the:
(i) name and terms of officers or directors;
(ii) site(s) at which professional services are provided; and
(iii) person responsible for filing the waiver application or the person's contact information; and/or
(iv) a transfer or assignment of interest as set forth in subdivision (j) of this section, provided that the entity shall notify the Department immediately of such change.
(2) Notification shall be made in a form prescribed by the department.
(j) Transfer or assignment of waiver. A waiver issued by the Department pursuant to section 6503-a of the Education Law shall not be transferable or assignable. For purposes of this section, a transfer or assignment shall mean the conveyance of a waiver under this section from one entity to another entity.
(k) Triennial application. A waiver issued pursuant to this section shall be valid for three years. An entity that is issued a waiver shall submit an application for renewal of the waiver every three years.
§ 29.18 Unprofessional conduct in waived entities.
(a) An entity that is issued a waiver pursuant to section 6503-a of the Education Law and section 59.14 of this Title shall be under the supervision of the Board of Regents and subject to the disciplinary procedures and penalties set forth in subarticle 3 of Article 130 of the Education Law. Any such waiver shall be subject to suspension, revocation or annulment for cause, and any entity holding such a waiver shall be subject to disciplinary proceedings and penalties in the same manner, to the same extent, and for the same reasons as individuals and professional entities practicing the same profession. A certificate of waiver shall be considered the same as a license to practice a profession.
(b) Failure to disclose information. It shall be unprofessional conduct for an entity issued a waiver to have failed to disclose all information required by the Department in order to make an accurate determination of the entity's application. This shall include the failure to notify the Department that a director or officer of the entity has committed an act which raises a reasonable question as to moral character.
(c) Penalties for professional misconduct. The Board of Regents may impose upon an entity found guilty of unprofessional conduct under this section those penalties and fines authorized in section 6511 of the Education Law.
This notice is intended
to serve only as a notice of emergency adoption. This agency intends to adopt the provisions of this emergency rule as a permanent rule, having previously submitted to the Department of State a notice of proposed rule making, I.D. No. EDU-43-10-00010-P, Issue of October 27, 2010. The emergency rule will expire January 23, 2011.
Text of rule and any required statements and analyses may be obtained from:
Chris Moore, NYS Education Department, 89 Washington Avenue, Room 148 EB, Albany, NY 12234, (518) 473-8296, email: cmoore@mail.nysed.gov
Regulatory Impact Statement
1. STATUTORY AUTHORITY:
Section 207 of the Education Law grants general rule making authority to the Board of Regents to carry into effect the laws and policies of the State relating to education.
Section 6501 of the Education Law provides that, to qualify for admission to a profession, an applicant must meet requirements prescribed in the article of the Education Law that pertains to the particular profession.
Section 6503-a of the Education Law authorizes the Board of Regents to issue a waiver to qualified entities that seek to provide certain professional services, as defined in the Education Law.
Section 6504 of the Education Law authorizes the Board of Regents to supervise the admission to and regulation of the practice of the professions.
Paragraph (6) of section 6506 of the Education Law authorizes the Board of Regents to indorse a license issued by a licensing board of another state or country upon the applicant fulfilling the requirements.
Paragraph (a) of subdivision (2) of section 6507 of the Education Law authorizes the Commissioner of Education to promulgate regulations relating to the professions.
Subdivision (1) of section 6508 of the Education Law authorizes the state boards for the professions to assist the Regents and the Department in matters of professional licensure and practice.
Section 6510 of the Education Law sets for the procedures to be followed in cases of professional misconduct.
Section 6511 of the Education Law establishes penalties for professional misconduct that may be imposed by the Board of Regents.
2. LEGISLATIVE OBJECTIVES:
The proposed regulation carries out the intent of section 6503-a of the Education Law by setting forth the requirements by which a qualified not-for-profit or educational corporations may submit an application for a waiver authorizing it to provide professional services that are within the scopes of practice of psychology, licensed master social work, licensed clinical social work, and the mental health practitioner professions. The proposed amendment is necessary to ensure that entities employing licensed professionals and authorized persons, as defined in the Education Law, meet minimum standards for a waiver and that the entity is accountable and subject to the disciplinary authority of the Board of Regents, in the same way as a licensed professional under Title VIII of the Education Law.
3. NEEDS AND BENEFITS:
Chapters 130 and 132 of the Laws of 2010 amend the Education Law to address critical issues relating to the authority of certain entities to employ licensed master social workers (LMSW), licensed clinical social workers (LCSW), licensed mental health counselors (LMHC), licensed marriage and family therapists (LMFT), licensed creative arts therapists (LCAT), licensed psychoanalysts (LP), and licensed psychologists and to provide services within the scopes of practice of those professions. Prior to the restrictions on practice of those professions established by laws enacted in 2002, any individual or entity could provide psychotherapy and other services that are now restricted. While the new licensing laws provided exemptions for individuals in certain programs, these exemptions did not extend to thousands of not-for-profit and educational corporations throughout New York that provide essential services. This affected not only access to services for vulnerable persons, but also the ability of new graduates to meet the experience requirements for licensure in authorized settings, thereby restricting access to the licensed professions.
On June 18, 2010, Governor Paterson signed into law Chapters 130 and 132 of the Laws of 2010 to authorize the Department to issue waivers authorizing qualified entities to provide certain professional services; to accept supervised experience for licensure completed in settings that are eligible for waivers; to extend the exemption from licensure requirements for individuals in certain programs; and to mandate the Department to recommend, by July 1, 2012, with input from exempt agencies and key stakeholders, any amendments in laws or regulations needed to fully implement licensure by July 1, 2013.
The new section 6503-a of the Education Law authorizes the Department to issue a waiver to certain not-for-profit or educational corporations that were in existence on the effective date of the law, June 18, 2010. An entity must submit a waiver application within 120 days of the applications being posted on the Department's website and may continue to provide services until the application is approved or denied. The law allows entities to continue providing services until July 1, 2012, but if an application is denied by the Department, the entity must cease providing professional services in New York.
The law is very clear that the waiver is not intended to supplant the authority of other State agencies, such as the Department of Health or Office of Mental Health, that have oversight of health and mental health services. In reviewing applications for a waiver, the law requires the Education Department to collaborate with other State agencies to ensure public protection by minimizing the risk of an unqualified entity receiving a waiver to provide professional services. There are also provisions in the law in regard to eligible entities, professional services that may be offered by entities, oversight by the Board of Regents, and attestations by each officer or director of the entity that he or she is of good moral character. An entity that receives a waiver under the law must apply for a renewal every three years and must request a waiver certificate for each site in New York at which professional services are provided.
Section 6503-a identifies a number of entities that do not require a waiver from the corporate practice prohibitions, including any entity with an operating certificate issued under the Public Health Law, Mental Hygiene Law or in accordance with comparable procedures by a State, federal or local government agency; an institution of higher education that provides a program leading to licensure in medicine, nursing, psychology, social work or the mental health professions; an institution of higher education that provides counseling to students, staff and family members of students and staff; and a university faculty practice corporation. The law allows the Regents to identify in regulation other entities that do not require a waiver, provided that such entity is otherwise authorized by law to provide such services.
The proposed regulations implement the provisions of law by setting forth the requirements to be met by a qualified entity in order to receive a waiver. These include, but are not limited to, the submission of the certificate of incorporation or other documentation that authorizes the entity to provide services described in the law and a description of the services that will be offered to the public. The entity must attest to adequate financial resources and that it will comply with section 18 of the Public Health Law in regard to access to patient information and records. Although the granting of a waiver resolves the issue of the authority of the entity to provide professional services, only licensed or authorized persons may provide services, and the entity is responsible for verifying the licensure of providers and the appropriate supervision of interns or permit holders who are only authorized to practice under supervision.
The proposed addition of section 29.18 of the Rules of the Board of Regents implements the Board of Regents disciplinary authority over entities receiving waivers under Education Law section 6503-a. The amendment clarifies that the entity is subject to the same professional misconduct provisions of the Regents Rules as a licensed professional or professional entity, and that the entity has the same due process rights as a licensed professional or professional entity.
4. COSTS:
(a) Costs to State government: The proposed amendment does not impose any additional costs on State government, beyond those imposed by statute.
(b) Cost to local government: The proposed amendment establishes requirements for certain entities that apply for a waiver of the corporate practice prohibitions, but the law does not authorize local governments to apply for such waivers; therefore, there will be no cost to local government.
(c) Cost to private regulated parties: The proposed regulation will not impose any costs on applicants for the waiver of corporate practice prohibitions.
(d) Cost to the regulatory agency: As stated above in Costs to State government, the proposed regulation does not impose any additional costs beyond those imposed by statute.
5. LOCAL GOVERNMENT MANDATES:
The proposed regulation implements the requirements of section 6503-a of the Education Law, in regard to the services provided by individuals licensed or authorized under the Education Law in certain not-for-profit or educational corporations. Therefore, the proposed regulation does not impose any program, service, duty or responsibility upon local governments.
6. PAPERWORK:
The proposed regulation imposes no additional reporting or recordkeeping requirements beyond those imposed by section 6503-a of the Education Law. In accordance with section 6503-a, entities applying for a waiver will be required to submit to the State Education Department an application and evidence satisfactory to the Department that the entity meets the requirements in law and regulation for a waiver.
7. DUPLICATION:
The proposed regulation does not duplicate other existing State or Federal requirements.
8. ALTERNATIVES:
The proposed amendment implements the requirements of section 6503-a of the Education Law. Therefore, there are no viable alternatives.
9. FEDERAL STANDARDS:
There are no Federal standards for the waiver of corporate practice prohibitions for certain not-for-profit or educational corporations, as defined in section 6503-a of the Education Law.
10. COMPLIANCE SCHEDULE:
Applicants for the waiver must comply with the regulation on the stated effective date.
Regulatory Flexibility Analysis
The proposed amendments to the Commissioner's regulations and the Rules of the Board of Regents implement amendments to the Education Law that authorize the Department to issue to certain entities a waiver from restrictions on corporate practice for services provided under Articles 154 and 163 of the Education Law and psychotherapy services under section 8401(2) of the Education Law and authorized and provided under Articles 131, 139 or 153 of the Education Law. Chapters 130 and 132 of the Laws of 2010 were signed on June 18, 2010 to address critical issues relating to the authority of certain entities to employ licensed master social workers, licensed clinical social workers, licensed mental health counselors, licensed marriage and family therapists, licensed creative arts therapists, licensed psychoanalysts, and licensed psychologists to provide services within the scopes of practice of those professions.
The amendments will require certain not-for-profit and educational corporations to apply for a waiver from corporate practice prohibitions. While there may be an economic impact and recordkeeping, reporting, or other compliance requirements on not-for-profit and educational corporations, there will be no such impact or requirements imposed on small businesses as they are not authorized to apply for a waiver. Because it is clear from the nature of the regulation that there will be no effect on small businesses or local governments, no further steps were needed to ascertain that fact and none were taken.
Rural Area Flexibility Analysis
1. TYPES AND ESTIMATED NUMBER OF RURAL AREAS:
Education Law section 6503-a was signed into law on June 18, 2010 to address critical issues relating to the authority of certain entities to employ licensed master social workers, licensed clinical social workers, licensed mental health counselors, licensed marriage and family therapists, licensed creative arts therapists, licensed psychoanalysts, and licensed psychologists to provide services within the scopes of practice of those professions. These regulations will affect not-for-profit and educational corporations that provide these services in the 44 rural counties with less than 200,000 inhabitants and the 71 towns in urban counties with a population density of 150 per square mile or less.
2. REPORTING, RECORDKEEPING AND OTHER COMPLIANCE REQUIREMENTS; AND PROFESSIONAL SERVICES:
The changes in law authorize certain entities, that employ licensed professionals to provide services that are restricted under Title VIII of the Education Law, to submit an application and meet the requirements in law and regulation. They will also be required to apply to renew their waivers triennially. There is no cost for the application and the regulations do not impose any additional reporting or recordkeeping requirements on entities, including those located in rural areas, beyond those requirements inherent in statute.
3. COSTS:
The proposed amendment does not impose any additional costs beyond those imposed by statute.
4. MINIMIZING ADVERSE IMPACT:
The proposed amendment implements the provisions of Chapters 130 and 132 of the Laws of 2010. These requirements are in place to ensure that not-for-profit or educational corporations that employ licensed professionals are subject to oversight by the Board of Regents to safeguard the public.
Due to the nature of the proposed amendment, the State Education Department does not believe it to be warranted to establish different requirements for institutions located in rural areas.
5. RURAL AREA PARTICIPATION:
Comments on the proposed amendment were solicited from the State Board for Mental Health Practitioners and from statewide professional associations whose memberships include individuals who live or work in rural areas.
Job Impact Statement
Education Law section 6503-a was signed into law on June 18, 2010 to address critical issues relating to the authority of certain entities to employ licensed master social workers, licensed clinical social workers, licensed mental health counselors, licensed marriage and family therapists, licensed creative arts therapists, licensed psychoanalysts, and licensed psychologists to provide services within the scopes of practice of those professions. The proposed amendments implement the requirements of section 6503-a to allow the Department to issue a waiver that allows certain not-for-profit corporations and educational corporations, as defined in the law, to overcome the corporate practice prohibitions in the Education Law.
Because it is evident from the nature of the proposed regulation that it will have no impact on jobs or employment opportunities, no further steps were needed to ascertain that fact and none were taken. Accordingly, a job impact statement is not required and one has not been prepared.
