Establishes reporting requirements for out of state entities provide reimbursement of health care costs and penalties for failing to comply with such reporting requirements.
NEW YORK STATE ASSEMBLY MEMORANDUM IN SUPPORT OF LEGISLATION submitted in accordance with Assembly Rule III, Sec 1(f)
BILL NUMBER: A5438
SPONSOR: Weprin TITLE OF BILL:
An act to amend the insurance law, in relation to establishing reporting
requirements for out of state entities not authorized to facilitate
payment or reimbursement of health care costs
PURPOSE:
The purpose of this legislation is to increase transparency, account-
ability, and consumer protection for New Yorkers who enroll in or are
offered health cost-sharing plans or arrangements by entities not
authorized to sell insurance in the state. By requiring these entities
to annually report key operational and financial information to the
Department of Financial Services, the bill ensures that consumers are
fully informed about the scope of benefits, exclusions, and payment
practices of such plans. It also provides a mechanism for state regula-
tors to address non-compliant entities through fines and, if necessary,
cease-and-desist orders, ultimately safeguarding consumers from unregu-
lated or potentially deceptive health coverage arrangements.
SUMMARY OF PROVISIONS:
Section one adds a new section to the Insurance Law: 3246. Section two
provides an effect date.
JUSTIFICATION:
This legislation is necessary to protect New York residents from unregu-
lated or potentially misleading health care plans or arrangements
offered by entities not authorized to transact insurance in this state.
By requiring these entities to submit annual, certified information to
the Superintendent of the Department of Financial Services, including
participant numbers, financial data, marketing materials, coverage
details, and contact information, this bill ensures greater transparency
and oversight.
Currently, many of these plans provide limited or no coverage for essen-
tial medical services, and some do not cover reproductive health care,
including pregnancy services, STD treatment, or HIV-related medications.
Moreover, they may present themselves in ways that resemble traditional
insurance, leaving consumers vulnerable to high out-of-pocket costs,
denied claims, and insufficient consumer protections.
Through mandatory reporting and accountability measures, this bill
allows state regulators to effectively monitor plan operations, protect
consumers from deceptive practices, and address deficiencies. The data
collected under this framework is critical for enforcing existing
consumer protection standards, thereby ensuring that New Yorkers have
access to reliable information about any plan or arrangement facilitat-
ing the payment or reimbursement of health care costs or services.
PRIOR LEGISLATIVE HISTORY:
None.
FISCAL IMPLICATIONS:
None
EFFECTIVE DATE:
This act takes effect on the ninetieth day after becoming law. The
superintendent may adopt any necessary rules or regulations on or before
the effective date to ensure full implementation.
STATE OF NEW YORK
________________________________________________________________________
5438
2025-2026 Regular Sessions
IN ASSEMBLY
February 14, 2025
___________
Introduced by M. of A. WEPRIN -- read once and referred to the Committee
on Insurance
AN ACT to amend the insurance law, in relation to establishing reporting
requirements for out of state entities not authorized to facilitate
payment or reimbursement of health care costs
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. The insurance law is amended by adding a new section 3246
2 to read as follows:
3 § 3246. Health care share plan or arrangement reporting requirements.
4 1. Any entity not authorized by the superintendent to offer insurance
5 in the state of New York, who offers or intends to offer a plan or
6 arrangement to facilitate payment or reimbursement of health care costs
7 for residents of New York, regardless of domicile, shall submit the
8 following information to the superintendent by October first, two thou-
9 sand twenty-five, and annually thereafter by March first:
10 (a) participant information, including:
11 (i) the total number of individual and household participants in the
12 state of New York for the previous calendar year;
13 (ii) the total number of employer groups participating, with specific
14 participant numbers for each employer group; and
15 (iii) the total number of national participants, if offered outside
16 the state of New York.
17 (b) provider contracts which shall include a list of contacts with New
18 York-based providers delivering health care services to participants.
19 (c) financial and operational information, including:
20 (i) the total fees, dues, or other payments collected from New York
21 participants in the previous year, specifying the percentage retained
22 for administrative costs;
23 (ii) the dollar amounts of health care reimbursement requests submit-
24 ted and paid within New York for the prior calendar year;
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD07830-01-5
A. 5438 2
1 (iii) the number of reimbursement requests denied, including percent-
2 ages and appeals denied; and
3 (iv) the amount the health care sharing ministry spent on medical care
4 versus administration over the past five years of the ministry's opera-
5 tion.
6 (d) disclosure of coverage and exclusions, including:
7 (i) a comprehensive list of all benefits covered by the ministry and a
8 detailed list of any excluded health procedures, drugs, and devices;
9 (ii) a list of all health care providers, hospitals, health centers,
10 dentists, laboratories, and pharmacies that participate in the health
11 care sharing ministry;
12 (iii) a list of any excluded health conditions, including pre-existing
13 conditions or higher fees that may be levied due to an enrollee's exist-
14 ing health condition or status;
15 (iv) a description of any waiting periods for eligibility for health
16 care sharing ministry payment; and
17 (v) a description of any enrollment eligibility rules or conditions,
18 such as age limits or requirements to be married.
19 (e) operational and marketing information, including:
20 (i) a list of counties in New York where plans were offered in the
21 previous year and are planned for the following year; and
22 (ii) details of any third-party entities involved in marketing or
23 enrolling participants in New York, including commissions or fees paid.
24 (f) organizational information, including:
25 (i) names, addresses, and contact information for key organizational
26 contacts in New York; and
27 (ii) an organizational chart with officer and director details.
28 2. An officer of an entity who offers or intends to offer a plan or
29 arrangement to facilitate payment or reimbursement of health care costs
30 for residents of New York shall certify the information required pursu-
31 ant to subsection one of this section.
32 3. An entity that fails to provide complete information upon
33 submission as required by subsection one of this section shall have such
34 submission deemed incomplete. The superintendent shall notify an entity
35 of any deficiencies with such entities submission within forty-five days
36 of deeming a submission incomplete. If an entity fails to correct such
37 deficiency within thirty days, a daily fine of five thousand dollars may
38 be imposed, with further penalties for continued non-compliance at the
39 discretion of the superintendent, including, but not limited to issuing
40 an emergency cease-and-desist order.
41 4. The superintendent shall post an annual report by April first
42 summarizing submissions, along with consumer guidance on filing
43 complaints.
44 5. The superintendent shall adopt rules and regulations necessary to
45 implement the provisions of this section.
46 § 2. This act shall take effect on the ninetieth day after it shall
47 have become a law. Effective immediately, the addition, amendment and/or
48 repeal of any rule or regulation necessary for the implementation of
49 this act on its effective date are authorized to be made and completed
50 on or before such effective date.
