Bill Text: NY S00652 | 2009-2010 | General Assembly | Introduced
Bill Title: Provides for the availability of standardized health insurance contracts for all small employers and individual proprietors and qualifying individuals, under the new Healthy New York insurance program; provides that there shall be no premium reductions due to stop loss fund subsidies; sets standards for premium rate calculation similar to those for qualifying small employers, qualifying individual proprietors and qualifying individuals.
Spectrum: Partisan Bill (Republican 10-0)
Status: (Introduced - Dead) 2010-01-06 - REFERRED TO INSURANCE [S00652 Detail]
Download: New_York-2009-S00652-Introduced.html
S T A T E O F N E W Y O R K ________________________________________________________________________ 652 2009-2010 Regular Sessions I N S E N A T E January 12, 2009 ___________ Introduced by Sens. LARKIN, DeFRANCISCO, FARLEY, LEIBELL, LITTLE, MORA- HAN, ROBACH, SALAND, SEWARD, WINNER -- 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 providing for stand- ardized health insurance contracts for all small employers, individual proprietors and qualifying individuals 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 4326-a 2 to read as follows: 3 S 4326-A. STANDARDIZED HEALTH INSURANCE CONTRACTS FOR ALL INDIVIDUAL 4 PROPRIETORS, SMALL EMPLOYERS AND QUALIFYING INDIVIDUALS. (A) NOTWITH- 5 STANDING ANY OTHER PROVISION OF LAW, ALL INDIVIDUAL PROPRIETORS WHO ARE 6 THE ONLY EMPLOYEE OF A BUSINESS, SMALL EMPLOYERS THAT HAVE BETWEEN TWO 7 AND FIFTY EMPLOYEES AND QUALIFYING INDIVIDUALS, AS DEFINED IN PARAGRAPH 8 THREE OF SUBSECTION (C) OF SECTION FOUR THOUSAND THREE HUNDRED 9 TWENTY-SIX OF THIS ARTICLE, PROVIDED THAT THE QUALIFIED INDIVIDUAL 10 RESIDES IN A HOUSEHOLD HAVING A NET HOUSEHOLD INCOME IN EXCESS OF TWO 11 HUNDRED FIFTY PERCENT OF THE NON-FARM FEDERAL POVERTY LEVEL, THAT ARE 12 OTHERWISE NOT QUALIFIED TO PURCHASE A STANDARDIZED HEALTH INSURANCE 13 CONTRACT SPECIFIED IN SECTION FOUR THOUSAND THREE HUNDRED TWENTY-SIX OF 14 THIS ARTICLE SHALL BE ELIGIBLE TO PURCHASE SUCH STANDARDIZED HEALTH 15 INSURANCE CONTRACTS; PROVIDED, HOWEVER THAT, SUCH INDIVIDUAL PROPRIE- 16 TORS, SMALL EMPLOYERS AND QUALIFYING INDIVIDUALS THAT PURCHASE SUCH 17 CONTRACTS SHALL NOT DIRECTLY OR INDIRECTLY RECEIVE ANY PREMIUM 18 REDUCTIONS DUE TO STOP LOSS FUND SUBSIDIES RECEIVED BY INSURERS AND 19 HEALTH MAINTENANCE ORGANIZATIONS PURSUANT TO SECTION FOUR THOUSAND THREE 20 HUNDRED TWENTY-SEVEN OF THIS ARTICLE. 21 (B) ALL HEALTH MAINTENANCE ORGANIZATIONS THAT ARE REQUIRED TO OFFER 22 CONTRACTS PURSUANT TO SECTION FOUR THOUSAND THREE HUNDRED TWENTY-SIX OF 23 THIS ARTICLE AND ALL COMPANIES SUBJECT TO ARTICLE FORTY-TWO OF THIS EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets [ ] is old law to be omitted. LBD05231-01-9 S. 652 2 1 CHAPTER AND CORPORATIONS SUBJECT TO THIS ARTICLE THAT VOLUNTARILY OFFER 2 CONTRACTS PURSUANT TO SUCH SECTION SHALL NOT RECEIVE STOP LOSS FUNDS OR 3 REIMBURSEMENTS FOR CLAIMS LOSSES SUSTAINED BY STANDARDIZED HEALTH INSUR- 4 ANCE CONTRACTS ISSUED TO INDIVIDUAL PROPRIETORS, SMALL EMPLOYERS AND 5 QUALIFYING INDIVIDUALS PURSUANT TO THIS SECTION. 6 (C) PREMIUM RATE CALCULATIONS FOR CONTRACTS ISSUED TO INDIVIDUAL 7 PROPRIETORS, SMALL EMPLOYERS AND QUALIFYING INDIVIDUALS PURSUANT TO THIS 8 SECTION SHALL BE SUBJECT TO THE FOLLOWING: 9 (1) COVERAGE MUST BE COMMUNITY RATED AND INCLUDE RATE TIERS FOR INDI- 10 VIDUALS, TWO ADULT FAMILIES, AND AT LEAST ONE OTHER FAMILY TIER. THE 11 RATE DIFFERENCES MUST BE BASED UPON THE COST DIFFERENCES FOR THE DIFFER- 12 ENT FAMILY UNITS AND THE RATE TIERS MUST BE UNIFORMLY APPLIED. 13 (2) IF GEOGRAPHIC RATING AREAS ARE UTILIZED, SUCH GEOGRAPHIC AREAS 14 MUST BE REASONABLE AND IN A GIVEN CASE MAY INCLUDE A SINGLE COUNTY. THE 15 GEOGRAPHIC AREAS UTILIZED MUST BE THE SAME FOR THE CONTRACTS ISSUED TO 16 INDIVIDUAL PROPRIETORS, TO SMALL EMPLOYERS AND TO QUALIFYING INDIVID- 17 UALS. THE SUPERINTENDENT SHALL NOT REQUIRE THE INCLUSION OF ANY SPECIF- 18 IC GEOGRAPHIC REGION WITHIN THE PROPOSED COMMUNITY RATED REGION SELECTED 19 BY THE HEALTH MAINTENANCE ORGANIZATION, CORPORATION OR INSURER SO LONG 20 AS THE HEALTH MAINTENANCE ORGANIZATION, CORPORATION OR INSURER'S 21 PROPOSED REGIONS DO NOT CONTAIN CONFIGURATIONS DESIGNED TO AVOID OR 22 SEGREGATE PARTICULAR AREAS WITHIN A COUNTY COVERED BY THE HEALTH MAINTE- 23 NANCE ORGANIZATION, CORPORATION OR INSURER'S COMMUNITY RATES. 24 (3) CLAIMS EXPERIENCE UNDER CONTRACTS ISSUED TO INDIVIDUAL PROPRIE- 25 TORS, TO SMALL EMPLOYERS AND TO QUALIFYING INDIVIDUALS MAY BE POOLED 26 SEPARATELY FOR RATE SETTING PURPOSES. 27 S 2. Subsection (c) of section 4326 of the insurance law, as added by 28 chapter 1 of the laws of 1999, subparagraph (A) of paragraph 1 and 29 subparagraph (C) of paragraph 3 as amended by chapter 419 of the laws of 30 2000, is amended to read as follows: 31 (c) The following definitions shall be applicable to the insurance 32 contracts offered under the program established by this section: 33 (1) A qualifying small employer is an employer that is either: 34 (A) An individual proprietor who is the only employee of the business: 35 (i) without health insurance which provides benefits on an expense 36 reimbursed or prepaid basis in effect during the twelve month period 37 prior to application for a qualifying group health insurance contract 38 under the program established by this section; and 39 (ii) resides in a household having a net household income at or below 40 two hundred [eight] FIFTY percent of the non-farm federal poverty level 41 (as defined and updated by the federal department of health and human 42 services) or the gross equivalent of such net income; 43 (iii) except that the requirements set forth in item (i) of this 44 subparagraph shall not be applicable where an individual proprietor had 45 health insurance coverage during the previous twelve months and such 46 coverage terminated due to one of the reasons set forth in items (i) 47 through (viii) of subparagraph (C) of paragraph three of THIS subsection 48 [(c) of this section]; or 49 (B) An employer with: 50 (i) not more than fifty eligible employees; 51 (ii) no group health insurance which provides benefits on an expense 52 reimbursed or prepaid basis covering employees in effect during the 53 twelve month period prior to application for a qualifying group health 54 insurance contract under the program established by this section; and 55 (iii) at least thirty percent of its eligible employees receiving 56 annual wages from the employer at a level equal to or less than thirty S. 652 3 1 thousand dollars. The thirty thousand dollar figure shall be adjusted 2 periodically pursuant to subparagraph (F) of this paragraph. 3 (C) The requirements set forth in item (i) of subparagraph (A) of this 4 paragraph and in item (ii) of subparagraph (B) of this paragraph shall 5 not be applicable where an individual proprietor or employer is trans- 6 ferring from a health insurance contract issued pursuant to the New York 7 state small business health insurance partnership program established by 8 section nine hundred twenty-two of the public health law or from health 9 care coverage issued pursuant to a regional pilot project for the unin- 10 sured established by section one thousand one hundred eighteen of this 11 chapter. 12 (D) The twelve month period set forth in item (i) of subparagraph (A) 13 of this paragraph and in item (ii) of subparagraph (B) of this paragraph 14 may be adjusted by the superintendent from twelve months to eighteen 15 months if he determines that the twelve month period is insufficient to 16 prevent inappropriate substitution of other health insurance contracts 17 for qualifying group health insurance contracts. 18 (E) An individual proprietor or employer shall cease to be a qualify- 19 ing small employer if any health insurance which provides benefits on an 20 expense reimbursed or prepaid basis covering the individual proprietor 21 or an employer's employees, other than qualifying group health insurance 22 purchased pursuant to this section, is purchased or otherwise takes 23 effect subsequent to purchase of qualifying group health insurance under 24 the program established by this section. 25 (F) The wage levels utilized in subparagraph (B) of this paragraph 26 shall be adjusted annually, beginning in two thousand two. The adjust- 27 ment shall take effect on July first of each year. For July first, two 28 thousand two, the adjustment shall be a percentage of the annual wage 29 figure specified in subparagraph (B) of this paragraph. For subsequent 30 years, the adjustment shall be a percentage of the annual wage figure 31 which took effect on July first of the prior year. The percentage 32 adjustment shall be the same percentage by which the current year's 33 non-farm federal poverty level, as defined and updated by the federal 34 department of health and human services, for a family unit of four 35 persons for the forty-eight contiguous states and Washington, D.C., 36 changed from the same level established for the prior year. 37 (2) A qualifying group health insurance contract is a group contract 38 purchased from a health maintenance organization, corporation or insurer 39 by a qualifying small employer which provides the benefits set forth in 40 subsection (d) of this section. The contract must insure not less than 41 fifty percent of the employees eligible for coverage. 42 (3)(A) A qualifying individual is an employed person: 43 (i) who does not have and has not had health insurance with benefits 44 on an expense reimbursed or prepaid basis during the twelve month period 45 prior to the individual's application for health insurance under the 46 program established by this section; 47 (ii) whose employer does not provide group health insurance and has 48 not provided group health insurance with benefits on an expense reim- 49 bursed or prepaid basis covering employees in effect during the twelve 50 month period prior to the individual's application for health insurance 51 under the program established by this section; 52 (iii) [resides] RESIDING in a household having a net household income 53 at or below two hundred [eight] FIFTY percent of the non-farm federal 54 poverty level (as defined and updated by the federal department of 55 health and human services) or the gross equivalent of such net income; 56 and S. 652 4 1 [(iv)] WHO is ineligible for Medicare. 2 (B) The requirements set forth in items (i) and (ii) of subparagraph 3 (A) of this paragraph shall not be applicable where an individual is 4 transferring from a health insurance contract issued pursuant to the 5 voucher insurance program established by section one thousand one 6 hundred twenty-one of this chapter, a health insurance contract issued 7 pursuant to the New York state small business health insurance partner- 8 ship program established by section nine hundred twenty-two of the 9 public health law or health care coverage issued pursuant to a regional 10 pilot project for the uninsured established by section one thousand one 11 hundred eighteen of this chapter. 12 (C) The requirements set forth in items (i) and (ii) of subparagraph 13 (A) of this paragraph shall not be applicable where an individual had 14 health insurance coverage during the previous twelve months and such 15 coverage terminated due to: 16 (i) loss of employment due to factors other than voluntary separation; 17 (ii) death of a family member which results in termination of coverage 18 under a health insurance contract under which the individual is covered; 19 (iii) change to a new employer that does not provide group health 20 insurance with benefits on an expense reimbursed or prepaid basis; 21 (iv) change of residence so that no employer-based health insurance 22 with benefits on an expense reimbursed or prepaid basis is available; 23 (v) discontinuation of a group health insurance contract with benefits 24 on an expense reimbursed or prepaid basis covering the qualifying indi- 25 vidual as an employee or dependent; 26 (vi) expiration of the coverage periods established by the continua- 27 tion provisions of the Employee Retirement Income Security Act, 29 28 U.S.C. section 1161 et seq. and the Public Health Service Act, 42 29 U.S.C. section 300bb-1 et seq. established by the Consolidated Omnibus 30 Budget Reconciliation Act of 1985, as amended, or the continuation 31 provisions of subsection (m) of section three thousand two hundred twen- 32 ty-one, subsection (k) of section four thousand three hundred four and 33 subsection (e) of section four thousand three hundred five of this chap- 34 ter; 35 (vii) legal separation, divorce or annulment which results in termi- 36 nation of coverage under a health insurance contract under which the 37 individual is covered; or 38 (viii) loss of eligibility under a group health plan. 39 (D) The twelve month period set forth in items (i) and (ii) of subpar- 40 agraph (A) of this paragraph may be adjusted by the superintendent from 41 twelve months to eighteen months if he determines that the twelve month 42 period is insufficient to prevent inappropriate substitution of other 43 health insurance contracts for qualifying individual health insurance 44 contracts. 45 (4) A qualifying individual health insurance contract is an individual 46 contract issued directly to a qualifying individual and which provides 47 the benefits set forth in subsection (d) of this section. At the option 48 of the qualifying individual, such contract may include coverage for 49 dependents of the qualifying individual. 50 S 3. This act shall take effect on the first of January next succeed- 51 ing the date on which it shall have become a law; provided that the 52 superintendent of insurance is authorized to promulgate any and all 53 rules and regulations and take any other measures necessary to implement 54 this act on its effective date on or before such date.