2023 New York Laws › PBH - Public Health › Article 44 - Health Maintenance Organizations › 4416 - Excess Reserves of Certain Health Maintenance Organizations.

* § 4416. Excess reserves of certain health maintenance organizations.
  1.  The  commissioner  is authorized to require any comprehensive health
  services plan issued a special purpose certificate  of  authority  under
  section  forty-four  hundred three-a of this article, that satisfies the
  definition of corporation in  subparagraph  five  of  paragraph  (a)  of
  section  one  hundred  two  of  the not-for-profit corporation law or is
  exempt from taxation under section 501 of the Internal Revenue  Code  of
  1986   to   submit  all  financial  and  other  books  and  records  the
  commissioner deems necessary in  order  to  evaluate  an  organization's
  reserves.  The  commissioner, in consultation with the superintendent of
  the department of financial  services,  shall  examine  such  books  and
  records   and   shall   issue   a   report  on  the  health  maintenance
  organization's reserves. A request under this section  may  be  made  no
  more than two times per year per plan.
2.  Except  for  any  public  benefit corporation, the commissioner is
  authorized to promulgate regulations establishing a presumptive  reserve
  ceiling  for  any  comprehensive  health  services plan issued a special
  purpose  certificate  of  authority  under  section  forty-four  hundred
  three-a  of this article that satisfies the definition of corporation in
  subparagraph five of paragraph (a) of section one  hundred  two  of  the
  not-for-profit  corporation  law  or  that is exempt from taxation under
  section 501 of the Internal Revenue Code of 1986. Such regulations shall
  express the presumptive reserve ceiling as a percentage of  the  minimum
  contingent reserves applicable to such health maintenance organizations.
  The  presumptive reserve ceiling shall be no less than one hundred fifty
  percent of the minimum contingent reserves applicable to such plans.  In
  the  event  that the commissioner determines that a plan subject to this
  subdivision has reserves in excess of the  presumptive  reserve  ceiling
  for  two  consecutive  quarters, the commissioner may make a preliminary
  determination that all or a portion of such reserves in  excess  of  the
  ceiling  should  be redeployed by depositing such excess reserves in the
  health care transformation fund pursuant to subdivision  three  of  this
  section.  Prior  to making a preliminary determination, the commissioner
  shall consider whether such redeployment is  consistent  with  financial
  soundness  and  efficiency  and to the extent to which such reserves are
  being maintained consistent with the programmatic goals  of  the  state.
  Upon  making  such  a  preliminary  determination,  the department shall
  notify the plan and the plan shall be afforded an opportunity to  submit
  information  to the department to justify why such reserves in excess of
  the ceiling are necessary and should  not  be  so  redeployed.  Provided
  however,  under no circumstances shall the redeployment of such reserves
  for any plan exceed seven hundred and fifty million dollars annually.
3. If, after considering the information submitted by  the  plan,  the
  commissioner  adheres to the preliminary determination that the reserves
  in excess of the ceiling should be redeployed,  the  commissioner  shall
  direct that such reserves be deposited to the health care transformation
  fund  established pursuant to section ninety-two-hh of the state finance
  law or its successor to be used for investment in the transformation  of
  health  care delivery, including for capital investment, debt retirement
  or restructuring, housing and other social determinants  of  health,  or
  transitional  operating  support to health care providers, pursuant to a
  plan prepared by the commissioner and approved by the  director  of  the
  division of the budget.
4.  Notwithstanding any law to the contrary, on or after August first,
  two thousand eighteen no entity  subject  to  subdivision  two  of  this
  section  shall transfer or loan any funds to any subsidiary or member of
  the entity's holding company system or to a member or stockholder  where

  a  purpose  of  the transfer or loan is to avoid the application of this
  section.
* NB Repealed August 1, 2025