NY Ins L § 4317 (2021)
2021 New York Laws ISC - Insurance Article 43 - Non-Profit Medical and Dental Indemnity, or Health and Hospital Service Corporations 4317 - Rating of Individual and Small Group Health Insurance Contracts.

§  4317.  Rating  of  individual  and  small  group  health  insurance contracts.  (a) (1) No individual health insurance contract and no group health insurance contract covering between one and  fifty  employees  or members  of  the  group,  or  between  one  and one hundred employees or members of the group for policies issued or renewed on or after  January first,  two  thousand  sixteen  exclusive  of  spouses  and  dependents, including contracts for which the premiums are paid by a remitting agent for a group,  hereinafter  referred  to  as  a  small  group,  providing hospital   and/or  medical  benefits,  including  Medicare  supplemental insurance, shall be  issued  in  this  state  unless  such  contract  is community  rated  and,  notwithstanding any other provisions of law, the underwriting of such contract involves no more than the imposition of  a pre-existing   condition  limitation  if  otherwise  permitted  by  this article. (2) Any individual, and dependents of such individual, and  any small  group, including all employees or group members and dependents of employees or members, applying for  individual  or  small  group  health insurance  coverage  including  Medicare supplemental insurance, but not including coverage issued  on  or  after  January  first,  two  thousand fourteen  specified  in  subsection  (l)  of section four thousand three hundred four, and section four thousand three  hundred  twenty-eight  of this  chapter, must be accepted at all times throughout the year for any hospital  and/or  medical  coverage  offered  by  the   corporation   to individuals  or  small  groups  in  this  state.  (3)  Once accepted for coverage, an individual or small  group  cannot  be  terminated  by  the insurer   due   to   claims  experience.  Termination  of  coverage  for individuals or small groups may be based only on  one  or  more  of  the reasons  set  forth  in  subsection  (c)  of section four thousand three hundred four or subsection (j) of section four  thousand  three  hundred five  of this article.  (4) For the purposes of this section, "community rated" means a rating methodology in which the premium for  all  persons covered  by  a  policy  or  contract  form  is  the  same,  based on the experience of the entire pool of  risks  of  all  individuals  or  small groups  covered  by  the  corporation without regard to age, sex, health status, tobacco usage or occupation excluding those individuals of small groups  covered  by  Medicare  supplemental  insurance.   For   medicare supplemental  insurance  coverage,  "community  rated"  means  a  rating methodology in which the premiums for all persons covered by a policy or contract form is the same based on the experience of the entire pool  of risks  covered  by  that  policy or contract form without regard to age, sex, health status, tobacco usage or occupation.  (b) (1) The superintendent may set standard premium tiers and standard rating relativities between tiers applicable to all contracts subject to this section. The superintendent may  also  set  a  standard  relativity applicable to child-only contracts issued pursuant to section 1302(f) of the  affordable  care  act,  42  U.S.C.  §  18022(f). The relativity for child-only contracts must be actuarially justifiable using the aggregate experience of  corporations  to  prevent  the  charging  of  unjustified premiums.   The   superintendent  may  adjust  such  premium  tiers  and relativities  periodically  based  upon  the  aggregate  experience   of corporations  issuing  contract  forms  subject  to  this section. (2) A corporation shall establish separate community rates for individuals  as opposed  to  small  groups.  (3) If a corporation is required to issue a contract to individual proprietors pursuant to subsection  (f)  of  this section,   such  contract  shall  be  subject  to  the  requirements  of subsection (a) of this section.  (c) (1) The superintendent shall permit the use of separate  community rates  for  reasonable  geographic  regions, which may, in a given case, include  a  single  county.  The  regions  shall  be  approved  by   the  superintendent  as part of the rate filing. The superintendent shall not require the inclusion of any  specific  geographic  regions  within  the proposed community rated regions selected by the corporation in its rate filing  so  long  as  the  corporation's proposed regions do not contain configurations designed to avoid or segregate particular areas within  a county  covered  by  the corporation's community rates. (2) Beginning on January first, two thousand fourteen, for every contract subject to this section that provides physician  services,  medical,  major  medical  or similar  comprehensive-type  coverage,  except for Medicare supplemental insurance, corporations shall use standardized  regions  established  by the superintendent.  (d)  * (1) (A) This section shall also apply to a contract issued to a group defined in subsection (c) of section  four  thousand  two  hundred thirty-five of this chapter, including but not limited to an association or  trust  of  employers,  if  the  group  includes  one  or more member employers or other member groups having one hundred or  fewer  employees or members exclusive of spouses and dependents. For a contract issued or renewed  on  or after January first, two thousand fourteen, if the group includes one or more member small group employers eligible for  coverage subject  to this section, then such member employers shall be classified as small groups for rating purposes and the remaining members  shall  be rated  consistent  with  the  rating  rules applicable to such remaining members pursuant to paragraph two of this subsection. (B) Subparagraph A of this paragraph shall not apply to either the renewal  of  a  contract issued  to  a group or the issuance, between January first, two thousand sixteen and December thirty-first, two thousand sixteen, of a  contract, and  any  renewal thereof, to a group, provided that the following three requirements are met: (I) the group had been issued a contract that  was in effect on July first, two thousand fifteen; (II) the group had member employers,  who,  on  or  after  July  first, two thousand fifteen, have between fifty-one and one hundred employees, exclusive  of  spouses  and dependents; and (III) the group is either: (i) comprised entirely of one or  more  municipal corporations or districts (as such terms are defined in section one hundred nineteen-n of the general municipal law); or (ii) comprised entirely of nonpublic schools providing education in any grade from pre-kindergarten through twelfth grade.   * NB Effective until December 28, 2025   * (1) This section shall also apply to a contract issued  to  a  group defined   in  subsection  (c)  of  section  four  thousand  two  hundred thirty-five of this chapter, including but not limited to an association or trust of  employers,  if  the  group  includes  one  or  more  member employers  or  other  member  groups  which  have  one  hundred or fewer employees or members exclusive of spouses and dependents. For  contracts issued  or  renewed on or after January first, two thousand fourteen, if the group includes one or more member small group employers eligible for coverage subject to this section, then such member  employers  shall  be classified as small groups for rating purposes and the remaining members shall  be  rated  consistent  with  the  rating rules applicable to such remaining members pursuant to paragraph two of this subsection.   * NB Effective December 28, 2025  (2) If a contract is issued to a group defined in  subsection  (c)  of section  four thousand two hundred thirty-five of this chapter including association groups, that includes one or more individual  or  individual proprietor  members,  then  for  rating  purposes  the corporation shall include such members in its individual pool  of  risks  in  establishing premium rates for such members.  (3)  A  corporation  shall  provide  specific  claims  experience to a municipal corporation, as defined in  subsection  (f)  of  section  four  thousand  seven  hundred two of this chapter, covered by the corporation under a community rated contract when the municipal corporation requests its claims experience for purposes of forming  or  joining  a  municipal cooperative   health   benefit   plan   certified  pursuant  to  article forty-seven of this chapter. Notwithstanding the  foregoing  provisions, no  corporation  shall  be  required  to  provide more than three years' claims experience to a municipal corporation making this request.  (e) * (1) Notwithstanding any other  provision  of  this  chapter,  no insurer,  subsidiary  of  an  insurer, or controlled person of a holding company system may act as an administrator or claims  paying  agent,  as opposed  to  an  insurer,  on  behalf  of  small  groups  which, if they purchased insurance, would be subject to this section.  No  insurer  may provide  stop loss, catastrophic or reinsurance coverage to small groups which, if they purchased insurance, would be subject  to  this  section. Provided,  however, the provisions of this paragraph shall not apply to: (A) the renewal of  stop  loss,  catastrophic  or  reinsurance  coverage issued  and  in  effect  on January first, two thousand fifteen to small groups covering between fifty-one and one hundred employees  or  members of  the  group; and (B) the issuance between January first, two thousand sixteen, and December thirty-first, two thousand sixteen, of stop  loss, catastrophic  or  reinsurance  coverage,  and  any renewal thereof, to a small group covering between fifty-one  and  one  hundred  employees  or members   of  the  group,  provided  that  such  group  had  stop  loss, catastrophic or reinsurance coverage issued and  in  effect  on  January first, two thousand fifteen.   * NB Effective until December 28, 2025   * (1) Notwithstanding any other provision of this chapter, no insurer, subsidiary  of  an  insurer,  or  controlled person of a holding company system may act as an administrator or claims paying agent, as opposed to an  insurer,  on  behalf  of  small  groups  which,  if  they  purchased insurance,  would  be subject to this section. No insurer, subsidiary of an insurer, or controlled person of a holding company may  provide  stop loss,  catastrophic  or  reinsurance  coverage to small groups which, if they purchased insurance, would be subject to this section.   * NB Effective December 28, 2025  (2) This subsection shall not apply to coverage insuring a  plan  that was  in  effect  on  or  before  December thirty-first, nineteen hundred ninety-one and  was  issued  to  a  group  that  includes  member  small employers  or  other  member  small groups, including but not limited to association groups, provided that (A)  acceptance  of  additional  small member  employers  (or  other  member groups comprised of fifty or fewer employees or members, exclusive of  spouses  and  dependents)  into  the group  on  or  after  June first, nineteen hundred ninety-two and before April first, nineteen hundred ninety-four  does  not  exceed  an  amount equal  to  ten  percent  per year of the total number of persons covered under the group as of  June  first,  nineteen  hundred  ninety-two,  but nothing  in  this subparagraph shall limit the addition of larger member employers; (B) (i) after April first, nineteen hundred ninety-four,  the group  thereafter accepts member small employers and member small groups without underwriting by any more than the imposition of  a  pre-existing condition  limitation  as  permitted  by  this  article and the cost for participation in the group for all persons covered  shall  be  the  same based  on  the  experience of the entire pool of risks covered under the entire group, without regard to age, sex, health status  or  occupation; and;  (ii)  once  accepted  for  coverage,  an individual or small group cannot be terminated due to claims experience; (C) the  corporation  has registered  the  names  of  such  groups,  including the total number of persons covered as of June first, nineteen hundred ninety-two, with  the  superintendent, in a form prescribed by the superintendent, on or before April  first,  nineteen  hundred  ninety-three and shall report annually thereafter until such groups comply with the provisions of  subparagraph (B)  of  this paragraph; and (D) the types or categories of employers or groups eligible to join the association  are  not  altered  or  expanded after June first, nineteen hundred ninety-two.  (3)  A corporation may apply to the superintendent for an extension or extensions of time beyond April first, nineteen hundred  ninety-four  in which  to  implement the provisions of this subsection as they relate to groups registered with the superintendent pursuant to  subparagraph  (C) of  paragraph  two  of this subsection; any such extension or extensions may not exceed two years in aggregate duration, and the ten percent  per year  limitation of subparagraph (A) of paragraph two of this subsection shall be reduced to five percent per year during the period of any  such extension   or  extensions.  Any  application  for  an  extension  shall demonstrate that a significant financial hardship to  such  group  would result from such implementation.  (f)(1)  If  the  corporation  issues  coverage to an association group (including chambers of commerce), as  defined  in  subparagraph  (K)  of paragraph  one  of  subsection  (c) of section four thousand two hundred thirty-five of this chapter, then the corporation shall issue  the  same coverage  to  individual  proprietors  who purchase coverage through the association group as the corporation  issues  to  groups  that  purchase coverage  through  the  association  group;  provided,  however,  that a corporation that, on the effective date of this subsection,  is  issuing coverage  to  individual  proprietors  not connected with an association group, may continue to issue such coverage provided that the coverage is otherwise in accordance with this subsection and  all  other  applicable provisions of law.  (2)  For  coverage  purchased  pursuant  to  this  subsection  through December thirty-first, two  thousand  thirteen,  individual  proprietors shall  be  classified  in  their own community rating category, provided however,  up  to  and  including  December  thirty-first,  two  thousand thirteen,  the  premium  rate  established  for  individual  proprietors purchased pursuant to paragraph one of  this  subsection  shall  not  be greater than one hundred fifteen percent of the rate established for the same  coverage  issued to groups. Coverage purchased or renewed pursuant to this subsection on or after  January  first,  two  thousand  fourteen shall be classified in the individual rating category.  (3)  The corporation may require members of the association purchasing health insurance to verify that all employees electing health  insurance are  legitimate  employees  of  the employers, as documented on New York state tax form NYS-45-ATT-MN or comparable documentation. In order to be eligible to purchase health insurance pursuant to  this  subsection  and obtain  the  same  group  insurance products as are offered to groups, a sole employee of a corporation or a sole proprietor of an unincorporated business or entity must (A) work at least twenty hours per week, (B)  if purchasing the coverage through an association group, be a member of the association  for  at least sixty days prior to the effective date of the insurance  contract,  and  (C)  present  a   copy   of   the   following documentation  to  the  corporation  or  health plan administrator on an annual basis:  (i) NYS  tax  form  45-ATT,  or  comparable  documentation  of  active employee status;  (ii)  for  an unincorporated business, the prior year's federal income tax Schedule C for an incorporated business subject to Subchapter S with a sole employee, federal income tax Schedule E  for  other  incorporated  businesses with a sole employee, a W-2 annual wage statement, or federal tax form 1099 with federal income tax Schedule F; or  (iii)  for  a business in business for less than one year, a cancelled business check, a certificate of  doing  business,  or  appropriate  tax documentation; and  (iv)  such  other  documentation  as may be reasonably required by the insurer as approved by the superintendent to verify  eligibility  of  an individual to purchase health insurance pursuant to this subsection.  (4)  Notwithstanding  the  provisions  of  item  (I)  of clause (i) of subparagraph (K) of paragraph one of  subsection  (c)  of  section  four thousand  two  hundred thirty-five of this chapter, for purposes of this section, an association group shall include chambers  of  commerce  with less   than   two   hundred   members  and  which  are  501C3  or  501C6 organizations.