2023 New York Laws › ISC - Insurance › Article 43 - Non-Profit Medical and Dental Indemnity, or Health and Hospital Service Corporations › 4321-A - Fund for Standardized Individual Enrollee Direct Payment Contracts.

§  4321-a.  Fund  for  standardized individual enrollee direct payment
contracts. (a) The superintendent shall  establish  a  fund  from  which
health  maintenance  organizations  may  receive  reimbursement,  to the
extent of funds available therefor,  for  claims  paid  by  such  health
maintenance   organizations   for  members  covered  under  standardized
individual enrollee direct payment contracts issued pursuant to  section
four  thousand  three  hundred  twenty-one  of  this  article.  The fund
established by the superintendent pursuant  to  this  section  shall  be
known  as the direct payment stop loss fund. Commencing in calendar year
two thousand, health maintenance  organizations  shall  be  eligible  to
receive  reimbursement from the direct payment stop loss fund for ninety
percent of claims paid between twenty thousand and one hundred  thousand
dollars  in  a  calendar  year  for  any member covered under a contract
issued pursuant to section four thousand  three  hundred  twenty-one  of
this  article.  For  the  purposes of this section, claims shall include
health care claims paid by a health maintenance organization  on  behalf
of  a  covered  member  pursuant  to  such  standardized  direct payment
contracts.
(b) The superintendent  shall  promulgate  regulations  setting  forth
procedures  for  the  operation of the direct payment stop loss fund and
the distribution of monies therefrom.
(c) Claims shall be reported and  funds  shall  be  distributed  on  a
calendar year basis. Claims shall be eligible for reimbursement only for
the  calendar  year  in  which  the claims are paid. Once claims paid on
behalf of a member reach or exceed one hundred  thousand  dollars  in  a
given  calendar year, no further claims paid on behalf of such member in
such calendar year shall be eligible for reimbursement.
(d) Each health maintenance organization shall submit  a  request  for
reimbursement  from  the  stop  loss  fund  on  a form prescribed by the
superintendent. Such request for reimbursement  shall  be  submitted  no
later  than April first following the end of the calendar year for which
the reimbursement request is being made. The superintendent may  require
health   maintenance   organizations  to  submit  such  claims  data  in
connection with the reimbursement  request  as  he  deems  necessary  to
enable  him to distribute monies and oversee the operation of the direct
payment stop loss fund. The superintendent may require that such data be
submitted on a per member, aggregate and/or categorical basis.
(e) The superintendent shall calculate the total claims  reimbursement
amount  for  all  health maintenance organizations for the calendar year
for which claims are being reported.
(1) In the event that the total amount requested for reimbursement  by
all  health  maintenance organizations for a calendar year exceeds funds
available for distribution for claims paid  by  all  health  maintenance
organizations  during  that same calendar year, the superintendent shall
provide for the pro-rata  distribution  of  the  available  funds.  Each
health  maintenance  organization shall be eligible to receive only such
proportionate amount of the available funds  as  the  individual  health
maintenance organization's total eligible claims paid bears to the total
eligible claims paid by all health maintenance organizations.
(2)  In the event that (A) funds available for distribution for claims
paid by all health maintenance  organizations  during  a  calendar  year
exceeds  the  total  amount  requested  for  reimbursement by all health
maintenance organizations during that same calendar year,  and  (B)  the
total  amount  requested  for  reimbursement  by  all health maintenance
organizations from the direct payment out-of-plan stop loss fund exceeds
the amount available for distribution from such fund,  then  any  excess
funds  shall  be  reallocated  for  distribution  to  the direct payment
out-of-plan stop loss  fund.  Otherwise,  such  excess  funds  shall  be

carried  forward  and will not affect monies appropriated for the direct
payment stop loss fund in the next calendar year.
(f)  Upon  the  request of the superintendent, each health maintenance
organization  shall  be  required  to   furnish   such   data   as   the
superintendent  deems  necessary  to oversee the operation of the direct
payment stop  loss  fund.  Such  data  shall  be  furnished  in  a  form
prescribed by the superintendent.
(g)  The  superintendent may obtain the services of an organization to
administer the direct payment stop loss fund. The  superintendent  shall
establish  guidelines  for  the submission of proposals by organizations
for the purposes of administering the  fund.  The  superintendent  shall
make  a  determination  whether  to  approve,  disapprove  or  recommend
modification to the proposal of an applicant to administer the fund.  An
organization approved to administer the fund shall submit reports to the
superintendent  in  such  form  and  at  times as may be required by the
superintendent in order to  facilitate  evaluation  and  ensure  orderly
operation of the fund, including, but not limited to an annual report of
the  affairs  and operations of the fund, such report to be delivered to
the superintendent and to the chairs of the senate finance committee and
assembly  ways  and  means  committee.  An  organization   approved   to
administer  the  fund shall maintain records in a form prescribed by the
superintendent and which shall be available for inspection by or at  the
request  of  the  superintendent. The superintendent shall determine the
amount of compensation to be allocated to an  approved  organization  as
payment  for fund administration. Compensation shall be payable from the
direct payment stop loss fund. An organization  approved  to  administer
the  fund may be removed by the superintendent and must cooperate in the
orderly transition of services to another approved  organization  or  to
the superintendent.
(h)  If  the  superintendent  deems  it  appropriate  for  the  proper
administration of the direct payment stop loss fund,  the  administrator
of  the  fund,  on  behalf  of  and  with  the  prior  approval  of  the
superintendent, shall be authorized  to  purchase  stop  loss  insurance
and/or reinsurance from an insurance company licensed to write such type
of  insurance in this state. Such stop loss insurance and/or reinsurance
may be purchased to the extent of funds available therefor  within  such
funds which are available for purposes of the stop loss fund.