2023 New York Laws › ISC - Insurance › Article 47 - Municipal Cooperative Health Benefit Plans › 4705 - Municipal Cooperation Agreements.

§   4705.   Municipal   cooperation   agreements.  (a)  The  municipal
cooperation agreement, under  which  the  municipal  cooperative  health
benefit  plan  is established and maintained, and any amendment thereto,
shall  be  approved  by  each  participating  municipal  corporation  by
majority vote of each such corporation's governing body, and shall:
(1)  specify all municipal corporations participating in the municipal
cooperative health benefit  plan  and  describe  the  form  or  type  of
municipal corporations eligible for participation;
(2) state that all participating municipal corporations agree to share
the  costs  of  and  assume  the  liabilities  for medical, surgical and
hospital  benefits  provided  under  the  municipal  cooperative  health
benefit  plan  to  the  covered employees (including retirees) and their
dependents of all participating municipal corporations;
(3) state that each participating municipal corporation agrees to  pay
on  demand  such municipal corporation's share of any assessment ordered
by the governing board of the municipal cooperative health benefit  plan
or  by  the superintendent under this article or article seventy-four of
this chapter;
(4)  specify  the  eligibility  requirements  for  membership  in  and
coverage  by  the  municipal  cooperative health benefit plan, including
reasonable geographic boundaries (if any) of such plan, provided that no
municipal cooperation agreement shall include any provision  restricting
or  otherwise  limiting  the  right  to  participate  in  the  plan of a
municipal corporation of the same type which provides satisfactory proof
of  its  financial  responsibility  and  which  is  located  within  the
geographic region in which the municipal cooperative health benefit plan
operates;
(5)  not  include  any provision restricting or otherwise limiting the
right of eligible employees (including retirees  and  dependents)  of  a
participating municipal corporation to enroll for coverage in the plan;
(6)   designate  the  fiscal  officer  of  a  participating  municipal
corporation to be the chief fiscal officer of the municipal  cooperative
health benefit plan;
(7)  designate  the  plan's  attorney-in-fact  to  receive  service of
summons or other legal process in any action, suit or proceeding arising
out of any contract, agreement or transaction involving  such  municipal
cooperative health benefit plan; and
(8)  establish a governing board to be responsible for the management,
control and administration of the municipal cooperative  health  benefit
plan,  provided  any municipal cooperative agreement to establish such a
plan which is entered into after the  effective  date  of  this  article
shall  provide that unions which are the exclusive collective bargaining
representatives of employees who are covered by such health benefit plan
shall be entitled to representation on such governing board.
(b) The municipal cooperation agreement shall provide that the  plan's
chief fiscal officer:
(1)  shall  have  custody  of  all  moneys  received  by the municipal
cooperative health benefit plan or made available for expenditure  under
the plan;
(2) shall, notwithstanding any provision of the general municipal law,
make  payment  in  accordance  with  procedures  developed by the plan's
governing board and acceptable to the superintendent;
(3) may invest moneys not required for immediate  expenditure  in  the
types  of  investment  specified  in  the  general  municipal law or the
education law (as applicable) for temporary investments or as  otherwise
expressly permitted by the superintendent; and
(4)  shall  receive  no  remuneration,  except  that the participating
municipal  corporation  employing  the  chief  fiscal  officer  may   be

reimbursed  for  reasonable  expenses  incurred  in  connection with the
duties of such fiscal officer in connection with the plan.
(c) A municipal cooperation agreement shall include a provision:
(1)  describing  the  composition,  number  and procedures under which
governing board members are chosen, provided that, for those  agreements
entered  into  after  the  effective date of this article, the governing
board shall include representation by unions  which  are  the  exclusive
collective  bargaining representatives of employees covered by the plan,
and that such unions shall establish and  agree  to  the  procedures  by
which  the  member  or  members  of  the governing board which represent
unions are selected;
(2) designating one governing board member  to  have  custody  of  all
reports, statements and other documents of the plan; and
(3)  that  the  governing board shall meet at least annually at a time
and place in this state designated in accordance with the agreement.
(d)  The  municipal  cooperation  agreement  shall  provide  that  the
governing board:
(1)  shall  design  the  plan  of  benefits  provided by the municipal
cooperative health benefit  plan  and  prepare  the  plan  document  and
summary  plan description in accordance with section four thousand seven
hundred nine of this article;
(2) may enter into an agreement with a contract administrator or other
service provider, determined by the governing board to be qualified,  to
receive,  investigate,  recommend,  audit,  approve  or  make payment of
claims under the municipal cooperative  health  benefit  plan,  provided
that:
(A)  the  charges,  fees  and  other  compensation  for any contracted
services shall be clearly  stated  in  written  administrative  services
contracts  as required in subdivision six of section ninety-two-a of the
general municipal law;
(B) payment for contracted services shall  be  made  only  after  such
services are rendered;
(C)  no  member  of  the  plan's governing board or any member of such
member's immediate family shall be an owner, officer, director, partner,
or employee of any contract administrator retained by the plan; and
(D)  all  such  agreements  shall  comply  with  the  requirements  of
subdivision six of section ninety-two-a of the general municipal law.
(3) shall be authorized to purchase stop-loss insurance, to the extent
required  by  section four thousand seven hundred seven of this article,
on behalf of the municipal cooperative health benefit plan;
(4) shall be authorized to establish a joint fund or funds to  finance
all    plan   expenditures,   including   claims,   reserves,   surplus,
administration, stop-loss insurance and other expenses;
(5) shall prepare an  annual  budget  for  the  municipal  cooperative
health  benefit  plan  to  determine  the  premium  equivalent rates for
participating municipal corporations to be deposited in the plan's joint
fund or funds during the fiscal year, provided that:
(A) the governing board shall designate the bank or trust  company  in
which  joint  funds,  including  reserve  funds, are to be deposited and
which shall be located in this state, duly chartered under  federal  law
or the laws of this state; and
(B)  the  governing board shall establish premium equivalent rates for
participating municipal corporations on the bases of a community  rating
methodology  filed  with  and  approved  by  the  superintendent and, in
determining the annual premium equivalent rates, the governing board:
(i) may contract for necessary actuarial services to estimate expected
plan expenditures during the fiscal year;
(ii) shall maintain reserves in amounts  equal  to  or  exceeding  the
minimum  amounts  required by section four thousand seven hundred six of
this article; and
(iii)  shall  maintain  a  stop-loss policy or policies, to the extent
required by section four thousand seven hundred seven of this article;
(6) shall be authorized to assess participating municipal corporations
for additional contributions, if actual losses due to benefits paid out,
administrative expenses and  reserve  and  surplus  requirements  exceed
amounts held in the plan's joint funds; and
(7)  shall  be  authorized to refund amounts in excess of reserves and
surplus required by section four thousand  seven  hundred  six  of  this
article   and   anticipated  expenses  in  the  plan's  joint  funds  to
participating municipal corporations, or to retain such  excess  amounts
or  a  portion  thereof  and  apply such amounts in preparing the plan's
budget for the following year.
(e)  The  municipal  cooperation  agreement  shall  provide  for   the
following  to  be  prepared  and  furnished  to  the governing board, to
participating municipal corporations, to unions which are the  exclusive
bargaining  representatives  of employees covered by the plan and to the
superintendent:
(1) an annual audit, and opinions thereon, by an independent certified
public accountant, of the financial condition, accounting procedures and
internal control systems of the  municipal  cooperative  health  benefit
plan;
(2)  an  annual  report  and  quarterly  reports describing the plan's
current financial status; and
(3) an annual independent actuarial opinion on the financial soundness
of the plan,  including  the  actuarial  soundness  of  contribution  or
premium  equivalent rates and reserves, both as paid in the current year
and projected for the next fiscal year.
(f) The municipal cooperation agreement shall specify the  rights  and
obligations  of  a  municipal  corporation  withdrawing from a municipal
cooperative  health  benefit  plan  to  any  contribution  (or   premium
equivalent)  refund  or  reserve  fund  or for any contingent assessment
liability or other obligation.
(g) Every municipal cooperation agreement shall  contain  a  provision
stating  that  nothing contained in such agreement shall be construed to
waive  any  right  a  covered  person  possesses  with  respect  to  the
confidentiality  of  medical  records  and  that  such right may only be
waived upon the written consent of such covered person.