A01154 Summary:

BILL NOA01154
 
SAME ASSAME AS S02366
 
SPONSORCahill
 
COSPNSRGarbarino, Stirpe, Hevesi, Lavine, Magnarelli, Zebrowski, Steck, Quart, Lupinacci, Raia, Brindisi, Oaks, Friend
 
MLTSPNSRFitzpatrick, Kearns, Stec, Tenney
 
Amd SS3231 & 4317, Ins L
 
Redefines "small group" for the purposes of certain provisions of sections 3231 and 4317 of the insurance law.
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A01154 Actions:

BILL NOA01154
 
01/08/2015referred to insurance
01/06/2016referred to insurance
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A01154 Memo:

NEW YORK STATE ASSEMBLY
MEMORANDUM IN SUPPORT OF LEGISLATION
submitted in accordance with Assembly Rule III, Sec 1(f)
 
BILL NUMBER: A1154
 
SPONSOR: Cahill
  TITLE OF BILL: An act to amend the insurance law, in relation to rating of individual and small group health insurance contracts and policies   PURPOSE: To amend the insurance law to preserve the current stop loss insurance market.   SUMMARY OF PROVISIONS: Section 1 of the bill provides an exception to the definition of small group coverage when coverage is written by a commercial insurer. Section 2 of the bill provides that the prohibition against a commercial insurer acting as a third party administrator or providing stop loss coverage to self-funded small groups would continue to apply only to small groups of fifty or fewer employees or members. Section 3 of the bill provides an exception to the definition of small group coverage when coverage is written by a corporation organized under Article 43 of the Insurance Law. Section 4 of the bill provides that the prohibition against an Article 43 corporation acting as a third party administrator or providing stop loss coverage to self-funded small groups would continue to apply only to small groups of fifty or fewer employees or members. Section 5 of the bill sets forth the effective date.   JUSTIFICATION: Since 1993, insurance companies have been permitted to write stop loss insurance and to provide administrative services to self-funded employer groups with 51 or more employees. A redefinition of what constitutes a small group, designed to comply with the federal Affordable Care Act, had the inadvertent effect of prohibiting insurers from continuing to issue stop loss coverage to groups with between 51 and 100 employees effective 2016. This bill will allow the current stop loss marketplace to operate uninterrupted for self-insured groups without directly impacting the insured small group market.   LEGISLATIVE HISTORY: 2013-2014: A.9980 - Referred to Insurance   FISCAL IMPLICATIONS: None.   EFFECTIVE DATE: Immediately.
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A01154 Text:



 
                STATE OF NEW YORK
        ________________________________________________________________________
 
                                          1154
 
                               2015-2016 Regular Sessions
 
                   IN ASSEMBLY
 
                                     January 8, 2015
                                       ___________
 
        Introduced by M. of A. CAHILL -- read once and referred to the Committee
          on Insurance
 
        AN  ACT  to amend the insurance law, in relation to rating of individual
          and small group health insurance contracts and policies
 
          The People of the State of New York, represented in Senate and  Assem-
        bly, do enact as follows:
 
     1    Section 1. Paragraph 1 of subsection (a) of section 3231 of the insur-
     2  ance  law,  as amended by section 69 of part D of chapter 56 of the laws
     3  of 2013, is amended to read as follows:
     4    (1) No individual health insurance policy and no group  health  insur-
     5  ance  policy  covering between one and fifty employees or members of the
     6  group, except as set forth in subsection (h) of this section, or between
     7  one and one hundred employees or  members  of  the  group  for  policies
     8  issued or renewed on or after January first, two thousand sixteen exclu-
     9  sive  of  spouses  and  dependents,  hereinafter  referred to as a small
    10  group, providing hospital and/or medical  benefits,  including  medicare
    11  supplemental insurance, shall be issued in this state unless such policy
    12  is community rated and, notwithstanding any other provisions of law, the
    13  underwriting  of  such  policy involves no more than the imposition of a
    14  pre-existing condition limitation if otherwise permitted by  this  arti-
    15  cle.
    16    §  2.  Paragraph  1 of subsection (h) of section 3231 of the insurance
    17  law, as added by chapter 501 of the laws of 1992, is amended to read  as
    18  follows:
    19    (1)  Notwithstanding  any other provision of this chapter, no insurer,
    20  subsidiary of an insurer, or controlled  person  of  a  holding  company
    21  system may act as an administrator or claims paying agent, as opposed to
    22  an  insurer,  on  behalf of small groups which, if they purchased insur-
    23  ance, would be subject to this section. No  insurer,  subsidiary  of  an
    24  insurer,  or  controlled  person  of  a holding company may provide stop
    25  loss, catastrophic or reinsurance coverage to  small  groups  which,  if
 
         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD06335-01-5

        A. 1154                             2
 
     1  they purchased insurance, would be subject to this section. For purposes
     2  of  this  subsection,  "small  group"  shall  mean  a group comprised of
     3  between one and fifty employees or members,  exclusive  of  spouses  and
     4  dependents.
     5    §  3.  Paragraph  1 of subsection (a) of section 4317 of the insurance
     6  law, as amended by section 72 of part D of chapter 56  of  the  laws  of
     7  2013, is amended to read as follows:
     8    (1) No individual health insurance contract and no group health insur-
     9  ance contract covering between one and fifty employees or members of the
    10  group, except as set forth in subsection (e) of this section, or between
    11  one  and  one  hundred  employees  or  members of the group for policies
    12  issued or renewed on or after January first, two thousand sixteen exclu-
    13  sive of spouses and dependents, including contracts for which the premi-
    14  ums are paid by a remitting agent for a group, hereinafter  referred  to
    15  as  a small group, providing hospital and/or medical benefits, including
    16  Medicare supplemental insurance, shall be issued in  this  state  unless
    17  such   contract  is  community  rated  and,  notwithstanding  any  other
    18  provisions of law, the underwriting of such contract  involves  no  more
    19  than  the imposition of a pre-existing condition limitation if otherwise
    20  permitted by this article.
    21    § 4. Paragraph 1 of subsection (e) of section 4317  of  the  insurance
    22  law,  as  amended  by  section 72 of part D of chapter 56 of the laws of
    23  2013, is amended to read as follows:
    24    (1) Notwithstanding any other provision of this chapter,  no  insurer,
    25  subsidiary  of  an  insurer,  or  controlled person of a holding company
    26  system may act as an administrator or claims paying agent, as opposed to
    27  an insurer, on behalf of small groups which, if  they  purchased  insur-
    28  ance,  would  be  subject  to this section. No insurer, subsidiary of an
    29  insurer, or controlled person of a  holding  company  may  provide  stop
    30  loss,  catastrophic  or  reinsurance  coverage to small groups which, if
    31  they purchased insurance,  would  be  subject  to  this  section.    For
    32  purposes  of this subsection, "small group" shall mean a group comprised
    33  of between one and fifty employees or members, exclusive of spouses  and
    34  dependents.
    35    § 5. This act shall take effect immediately.
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