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S06960 Summary:

S06960 Actions:

S06960 Floor Votes:

S06960 Text:

 
                STATE OF NEW YORK
        ________________________________________________________________________
 
                                          6960
 
                    IN SENATE
 
                                      April 9, 2014
                                       ___________
 
        Introduced  by  Sen.  SEWARD -- read twice and ordered printed, and when
          printed to be committed to the Committee on Insurance
 
        AN ACT to amend the insurance law, in relation to allowing for  the  use
          of an affiliate company to meet certain obligations of an insurer
 
          The  People of the State of New York, represented in Senate and Assem-
        bly, do enact as follows:
 

     1    Section 1. Subparagraph (A)  of  paragraph  5  of  subsection  (c)  of
     2  section  3216 of the insurance law, as amended by section 46-b of part D
     3  of chapter 56 of the laws of 2013, is amended to read as follows:
     4    (A) Any family policy providing hospital or surgical expense insurance
     5  (but not including such insurance against accidental injury only)  shall
     6  provide  that, in the event such insurance on any person, other than the
     7  policyholder, is terminated because the person is no longer  within  the
     8  definition  of  the  family  as  set forth in the policy but before such
     9  person has attained the limiting age, if any,  for  coverage  of  adults
    10  specified in the policy, such person shall be entitled to have issued to
    11  that  person  by  the  insurer,  without  evidence of insurability, upon
    12  application therefor and payment of the first premium, within sixty days

    13  after such insurance shall have  terminated,  an  individual  conversion
    14  policy  that  contains  the  benefits  described  in  paragraph  one  of
    15  subsection (b) of section four thousand three  hundred  twenty-eight  of
    16  this chapter. The insurer shall offer one policy at each level of cover-
    17  age  as defined in section 1302(d) of the affordable care act, 42 U.S.C.
    18  § 18022(d). The individual may choose any such  policy  offered  by  the
    19  insurer.    Provided,  however, the superintendent may, after giving due
    20  consideration to the public interest,  approve  a  request  made  by  an
    21  insurer for the insurer to satisfy the requirements of this subparagraph
    22  through  the  offering of policies that comply with this subparagraph by
    23  another insurer, corporation or health maintenance  organization  within

    24  the  insurer's  holding company system, as defined in article fifteen of
    25  this chapter. The conversion privilege afforded  herein  shall  also  be
    26  available  upon  the divorce or annulment of the marriage of the policy-
    27  holder to the former spouse of such policyholder.
    28    § 2. Paragraph 2 of subsection (g) of section 3216  of  the  insurance
    29  law is amended by adding a new subparagraph (E) to read as follows:
    30    (E)  The  superintendent  may,  after  giving due consideration to the
    31  public interest, approve a request made by an insurer for the insurer to
 
         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD14588-01-4

        S. 6960                             2
 
     1  satisfy the requirements of subparagraph (C) of this  paragraph  through
     2  the offering of policies at each level of coverage as defined in section
     3  1302(d)  of  the affordable care act, 42 U.S.C. § 18022(d) that contains
     4  the  benefits  described  in  paragraph one of subsection (b) of section
     5  four thousand three hundred twenty-eight  of  this  chapter  by  another
     6  insurer,  corporation  or  health  maintenance  organization  within the
     7  insurer's same holding company system, as defined in article fifteen  of
     8  this chapter.
     9    §  3. Subsection (g) of section 3221 of the insurance law, as added by
    10  section 49 of part D of chapter 56 of the laws of 2013,  is  amended  to
    11  read as follows:

    12    (g) For conversion purposes, an insurer shall offer to the employee or
    13  member  a policy at each level of coverage as defined in section 1302(d)
    14  of the affordable care act, 42 U.S.C. § 18022(d) that contains the bene-
    15  fits described in paragraph one of subsection (b) of section four  thou-
    16  sand three hundred twenty-eight of this chapter.  Provided, however, the
    17  superintendent  may, after giving due consideration to the public inter-
    18  est, approve a request made by an insurer for the insurer to satisfy the
    19  requirements of this subsection and subsections  (e)  and  (f)  of  this
    20  section   through  the  offering  of  policies  that  comply  with  this
    21  subsection by another insurer, corporation or health maintenance  organ-
    22  ization within the insurer's holding company system, as defined in arti-

    23  cle fifteen of this chapter.
    24    §  4. Item (i) of subparagraph (C) of paragraph 2 of subsection (c) of
    25  section 4304 of the insurance law, as amended by section 43-a of part  D
    26  of chapter 56 of the laws of 2013, is amended to read as follows:
    27    (i)  Discontinuance  of  a  class  of contract upon not less than five
    28  months' prior written notice. In exercising the  option  to  discontinue
    29  coverage pursuant to this item, the corporation must act uniformly with-
    30  out  regard  to any health status-related factor of enrolled individuals
    31  or individuals who may become eligible for such coverage and must  offer
    32  to  subscribers  or  group  remitting agents, as may be appropriate, the
    33  option to  purchase  all  other  individual  health  insurance  coverage
    34  currently being offered by the corporation to applicants in that market.

    35  Provided,  however,  the  superintendent may, after giving due consider-
    36  ation to the public interest, approve a request made  by  a  corporation
    37  for the corporation to satisfy the requirements of this item through the
    38  offering  of  contracts  at each level of coverage as defined in section
    39  1302(d) of the affordable care act, 42 U.S.C. § 18022(d)  that  contains
    40  the  benefits  described  in  paragraph one of subsection (b) of section
    41  four thousand three hundred twenty-eight  of  this  chapter  by  another
    42  corporation,  insurer  or  health  maintenance  organization  within the
    43  corporation's same holding company system, as defined in article fifteen
    44  of this chapter.
    45    § 5. Paragraph 1 of subsection (e) of section 4304  of  the  insurance

    46  law,  as  amended  by  section 51 of part D of chapter 56 of the laws of
    47  2013, is amended to read as follows:
    48    (1) If  any  such  contract  is  terminated  in  accordance  with  the
    49  provisions  of  paragraph  one of subsection (c) of this section, or any
    50  such contract is terminated because of a default by the remitting  agent
    51  in  the  payment  of  premiums not cured within the grace period and the
    52  remitting agent has not replaced the contract with similar  and  contin-
    53  uous coverage for the same group whether insured or self-insured, or any
    54  such contract is terminated in accordance with the provisions of subpar-
    55  agraph  (E) of paragraph two of subsection (c) of this section, or if an
    56  individual other than the contract holder is no longer covered  under  a
        S. 6960                             3
 

     1  "family  contract"  because the individual is no longer within the defi-
     2  nition set forth in the contract, or a spouse is no longer covered under
     3  the contract because of divorce from the contract holder or annulment of
     4  the marriage, or any such contract is terminated because of the death of
     5  the contract holder, then such individual, former spouse, or in the case
     6  of the death of the contract holder the surviving spouse or other depen-
     7  dents of the deceased contract holder covered under the contract, as the
     8  case  may  be, shall be entitled to convert, without evidence of insura-
     9  bility, upon application therefor and the making of  the  first  payment
    10  thereunder  within  sixty  days  after  the  date of termination of such
    11  contract, to a contract that contains the benefits  described  in  para-
    12  graph one of subsection (b) of section four thousand three hundred twen-

    13  ty-eight  of  this  chapter. The corporation shall offer one contract at
    14  each level of coverage as defined in section 1302(d) of  the  affordable
    15  care  act,  42  U.S.C.  §  18022(d).  The individual may choose any such
    16  contract offered by the corporation.  Provided, however, the superinten-
    17  dent may, after giving due consideration to the public interest, approve
    18  a request made by a corporation  for  the  corporation  to  satisfy  the
    19  requirements  of  this  paragraph through the offering of contracts that
    20  comply with this paragraph by another  corporation,  insurer  or  health
    21  maintenance  organization  within the corporation's same holding company
    22  system, as defined in article fifteen of  this  chapter.  The  effective
    23  date  of  the coverage provided by the converted direct payment contract

    24  shall be the date of the termination of coverage under the contract from
    25  which conversion was made.
    26    § 6. Subparagraph (A) of paragraph 1 of subsection (d) of section 4305
    27  of the insurance law, as amended by section 52 of part D of  chapter  56
    28  of the laws of 2013, is amended to read as follows:
    29    (A)  A  group contract issued pursuant to this section shall contain a
    30  provision to the effect that in case of a termination of coverage  under
    31  such  contract of any member of the group because of (i) termination for
    32  any reason whatsoever of the member's employment or membership, or  (ii)
    33  termination  for  any  reason  whatsoever  of  the group contract itself
    34  unless the group contract holder has replaced the  group  contract  with
    35  similar  and  continuous  coverage for the same group whether insured or
    36  self-insured, the member shall be entitled to have issued to the  member

    37  by  the  corporation, without evidence of insurability, upon application
    38  therefor and payment of the first premium made to the corporation within
    39  sixty days after termination  of  the  coverage,  an  individual  direct
    40  payment  contract, covering such member and the member's eligible depen-
    41  dents who were covered by the group contract,  which  provides  coverage
    42  that  contains the benefits described in paragraph one of subsection (b)
    43  of section four thousand three hundred twenty-eight of this chapter. The
    44  corporation shall offer one  contract  at  each  level  of  coverage  as
    45  defined  in  section  1302(d)  of  the  affordable care act, 42 U.S.C. §
    46  18022(d). The member may choose any such contract offered by the  corpo-
    47  ration.    Provided,  however,  the superintendent may, after giving due

    48  consideration to the public interest, approve a request made by a corpo-
    49  ration for the corporation to satisfy the requirements of this  subpara-
    50  graph  through  the offering of contracts that comply with this subpara-
    51  graph by another corporation, insurer or health maintenance organization
    52  within the corporation's same holding  company  system,  as  defined  in
    53  article fifteen of this chapter.
    54    § 7. This act shall take effect immediately.