S T A T E   O F   N E W   Y O R K
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                                 1448--A

                       2013-2014 Regular Sessions

                          I N  A S S E M B L Y

                               (PREFILED)

                             January 9, 2013
                               ___________

Introduced  by  M.  of  A.  ZEBROWSKI  -- Multi-Sponsored by -- M. of A.
  CERETTO -- read once and referred to the Committee  on  Local  Govern-
  ments  -- recommitted to the Committee on Local Governments in accord-
  ance with Assembly Rule  3,  sec.  2  --  committee  discharged,  bill
  amended,  ordered reprinted as amended and recommitted to said commit-
  tee

AN ACT to amend the general municipal law, in  relation  to  authorizing
  cities,  towns,  villages,  school  districts,  boards  of cooperative
  educational services, library districts, fire  districts,  improvement
  districts  and  special districts to enter into cooperative agreements
  for the provision of centralized public  employee  administrative  and
  personnel  services;  and  to  amend the insurance law, in relation to
  authorizing the provision of health insurance  coverage  to  municipal
  employees  pursuant  to  standardized  health  insurance contracts and
  authorizing reduction of premiums  for  municipal  cooperative  health
  benefit plans which offer employee wellness programs

  THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section 1. Section 92-a of the general municipal law,  is  amended  by
adding a new subdivision 8 to read as follows:
  8. THE PROVISIONS OF THIS SECTION SHALL NOT APPLY TO ANY PUBLIC CORPO-
RATION  WHICH  PROVIDES  HEALTH  INSURANCE  BENEFITS TO ITS OFFICERS AND
EMPLOYEES PURSUANT TO ARTICLE FORTY-SEVEN OF THE INSURANCE LAW.
  S 2. Subdivision a of section 119-n of the general municipal  law,  as
amended  by  chapter  413  of  the  laws  of 1991, is amended to read as
follows:
  a. The term "municipal corporation" means a county outside the city of
New York, a city, a town, a village, a board of cooperative  educational
services, A PUBLIC LIBRARY AS DEFINED IN SECTION TWO HUNDRED FIFTY-THREE
OF THE EDUCATION LAW, A fire district or a school district.

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
              

                                                           LBD00407-03-4

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  S  3.  Subdivision  2 of section 119-o of the general municipal law is
amended by adding a new paragraph b-1 to read as follows:
  B-1.    THE  ESTABLISHMENT  OF  A  CENTRALIZED  OFFICE TO COLLECTIVELY
PROVIDE:
  (I) EMPLOYEE PAYROLL, TIME, ATTENDANCE  AND  PERSONNEL  ADMINISTRATION
SERVICES;
  (II) PARTICIPATION IN THE NEW YORK STATE HEALTH INSURANCE PROGRAM;
  (III)  A  PERSONNEL  OFFICE  TO PROVIDE INFORMATION ON EMPLOYEE HEALTH
INSURANCE AND OTHER EMPLOYEE BENEFITS;
  (IV) EMPLOYEE HEALTH INSURANCE BENEFITS  FROM  MORE  THAN  ONE  HEALTH
INSURANCE CARRIER OR ORGANIZATION, WHICH GRANTS EACH EMPLOYEE THE CHOICE
OF WHICH HEALTH INSURANCE PLAN WHICH WILL PROVIDE COVERAGE;
  (V)  EMPLOYEE  PARTICIPATION  IN TAX DEFERRED RETIREMENT PLANS, HEALTH
CARE PLANS AND CHILD CARE PLANS;
  (VI) MUNICIPAL COOPERATIVE HEALTH BENEFIT PLANS  PURSUANT  TO  ARTICLE
FORTY-SEVEN OF THE INSURANCE LAW;
  (VII)  ADEQUATE  AND  ONGOING FINANCIAL CONTROLS AND SECURITY ARRANGE-
MENTS TO  ENSURE  THAT  THE  PARTICIPATING  MUNICIPAL  CORPORATIONS  AND
DISTRICTS REMAIN SOLVENT;
  (VIII)  THE  PREPARATION AND DISSEMINATION OF INFORMATIONAL AND SOLIC-
ITATION MATERIALS TO  FACILITATE  COMPARISON  OF  THE  VARIOUS  EMPLOYEE
HEALTH  INSURANCE  PLANS  OFFERED  BY THE PARTICIPATING MUNICIPAL CORPO-
RATIONS AND DISTRICTS;
  (IX)  FOR  THE  ENROLLMENT,  BILLING,  PREMIUM   COLLECTION,   PREMIUM
DISBURSEMENT  AND  RECONCILIATION,  COMMISSION  DISBURSEMENT,  AND OTHER
PROCESSING SERVICES FOR HEALTH INSURANCE BENEFITS PROVIDED TO  MUNICIPAL
EMPLOYEES;
  (X)  CONTRACTING WITH QUALIFIED THIRD PARTIES FOR THE PROVISION OF ANY
SERVICE NECESSARY TO CARRY OUT SUCH OFFICE'S POWERS AND DUTIES; AND
  (XI) NEGOTIATION WITH PARTICIPATING HEALTH INSURERS AND HEALTH MAINTE-
NANCE ORGANIZATIONS WITH REGARD TO THE ADMINISTRATIVE  EXPENSES  PORTION
OF  PREMIUM  RATES CHARGED FOR HEALTH CARE COVERAGE OFFERED TO MUNICIPAL
EMPLOYEES BY SUCH OFFICE.
  S 4. Clause (iii) of subparagraph (A) of paragraph 1 of subsection (c)
of section 4326 of the insurance law, as amended by section 56 of part D
of chapter 56 of the laws of 2013, is amended to read as follows:
  (iii) at least thirty percent of its employees receiving annual  wages
from  the  employer  at  a  level  equal to or less than thirty thousand
dollars. The thirty thousand dollar figure  shall  be  adjusted  period-
ically pursuant to subparagraph (D) of this paragraph[.]; OR
  S  5.  Paragraph  1 of subsection (c) of section 4326 of the insurance
law is amended by adding a new subparagraph (B-1) to read as follows:
  (B-1) A MUNICIPAL EMPLOYER  AS  DEFINED  IN  AND  IN  ACCORDANCE  WITH
SECTION FOUR THOUSAND THREE HUNDRED TWENTY-SIX-A OF THIS ARTICLE.
  S  6.  The  insurance law is amended by adding a new section 4326-a to
read as follows:
  S  4326-A.  STANDARDIZED  HEALTH  INSURANCE  CONTRACTS  FOR  MUNICIPAL
EMPLOYERS.  (A)  FOR  THE PURPOSES OF THIS SECTION, "MUNICIPAL EMPLOYER"
SHALL MEAN A MUNICIPAL CORPORATION OR A DISTRICT, AS DEFINED IN  SECTION
ONE  HUNDRED NINETEEN-N OF THE GENERAL MUNICIPAL LAW, OR ANY COMBINATION
THEREOF.
  (B) NOTWITHSTANDING ANY OTHER PROVISION OF LAW, ANY MUNICIPAL EMPLOYER
MAY OFFER ITS EMPLOYEES, THAT ARE NOT OTHERWISE QUALIFIED TO PURCHASE  A
STANDARDIZED  HEALTH  INSURANCE CONTRACT SPECIFIED IN SECTION FOUR THOU-
SAND THREE HUNDRED TWENTY-SIX OF  THIS  ARTICLE  SHALL  BE  ELIGIBLE  TO
PURCHASE  SUCH STANDARDIZED HEALTH INSURANCE CONTRACTS; PROVIDED, HOWEV-

A. 1448--A                          3

ER, THAT SUCH MUNICIPAL  EMPLOYERS  AND  EMPLOYEES  THAT  PURCHASE  SUCH
CONTRACTS   SHALL   NOT  DIRECTLY  OR  INDIRECTLY  RECEIVE  ANY  PREMIUM
REDUCTIONS DUE TO STOP LOSS FUND  SUBSIDIES  RECEIVED  BY  INSURERS  AND
HEALTH MAINTENANCE ORGANIZATIONS PURSUANT TO SECTION FOUR THOUSAND THREE
HUNDRED TWENTY-SEVEN OF THIS ARTICLE.
  (C)  ALL  HEALTH  MAINTENANCE ORGANIZATIONS THAT ARE REQUIRED TO OFFER
CONTRACTS PURSUANT TO SECTION FOUR THOUSAND THREE HUNDRED TWENTY-SIX  OF
THIS  ARTICLE  AND  ALL  COMPANIES  SUBJECT TO ARTICLE FORTY-TWO OF THIS
CHAPTER AND CORPORATIONS SUBJECT TO THIS ARTICLE THAT VOLUNTARILY  OFFER
CONTRACTS  PURSUANT TO SUCH SECTION SHALL NOT RECEIVE STOP LOSS FUNDS OR
REIMBURSEMENTS FOR CLAIMS LOSSES SUSTAINED BY STANDARDIZED HEALTH INSUR-
ANCE CONTRACTS ISSUED TO MUNICIPAL EMPLOYERS AND EMPLOYEES  PURSUANT  TO
THIS SECTION.
  (D)  PREMIUM  RATE  CALCULATIONS  FOR  CONTRACTS  ISSUED  TO MUNICIPAL
EMPLOYERS AND EMPLOYEES PURSUANT TO THIS SECTION SHALL BE SUBJECT TO THE
FOLLOWING:
  (1) COVERAGE MAY BE COMMUNITY RATED OR EXPERIENCE RATED,  AND  INCLUDE
RATE  TIERS  FOR  INDIVIDUALS, TWO ADULT FAMILIES AND AT LEAST ONE OTHER
FAMILY TIER. THE RATE DIFFERENCES MUST BE BASED UPON  THE  COST  DIFFER-
ENCES FOR THE DIFFERENT FAMILY UNITS AND THE RATE TIERS MUST BE UNIFORM-
LY APPLIED;
  (2)  IF  GEOGRAPHIC  RATING  AREAS ARE UTILIZED, SUCH GEOGRAPHIC AREAS
MUST BE REASONABLE AND IN A GIVEN CASE MAY INCLUDE A SINGLE COUNTY; AND
  (3) CLAIMS EXPERIENCE UNDER CONTRACTS ISSUED  TO  MUNICIPAL  EMPLOYERS
AND EMPLOYEES MAY BE POOLED SEPARATELY FOR RATE SETTING PURPOSES.
  S  7. Subsections (a) and (f) of section 4702 of the insurance law, as
added by chapter 689 of  the  laws  of  1994,  are  amended  and  a  new
subsection (i-1) is added to read as follows:
  (a) "Community rating" means a rating methodology in which the premium
equivalent  rate  for  all persons covered under a municipal cooperative
health benefit plan is the same, based upon the experience of the entire
pool of risks covered under the plan, without regard to age, sex, health
status or occupation and such that refunds, rebates,  credits  or  divi-
dends  based  upon  age,  sex,  health  status  or  occupation  are  not
permitted; PROVIDED, HOWEVER, THAT,  SUBJECT  TO  THE  APPROVAL  OF  THE
SUPERINTENDENT,   SUCH  PLAN  MAY  PROVIDE  AN  ACTUARIALLY  APPROPRIATE
REDUCTION IN PREMIUM RATES IN RETURN  FOR  AN  ENROLLEE'S  OR  INSURED'S
ADHERENCE  TO A BONA FIDE WELLNESS PROGRAM. A BONA FIDE WELLNESS PROGRAM
IS EITHER A RISK MANAGEMENT SYSTEM THAT IDENTIFIES  AT-RISK  POPULATIONS
OR ANY OTHER SYSTEMATIC PROGRAM OR COURSE OF MEDICAL CONDUCT WHICH HELPS
TO  PROMOTE  GOOD  HEALTH, HELPS TO PREVENT OR MITIGATE ACUTE OR CHRONIC
SICKNESS OR DISEASE, OR WHICH MINIMIZES ADVERSE HEALTH CONSEQUENCES  DUE
TO  LIFESTYLE.  SUCH WELLNESS PROGRAM SHALL DEMONSTRATE ACTUARIALLY THAT
IT ENCOURAGES THE GENERAL GOOD HEALTH  AND  WELL-BEING  OF  THE  COVERED
POPULATION. SUCH PLAN SHALL NOT REQUIRE SPECIFIC OUTCOMES AS A RESULT OF
AN ENROLLEE'S OR INSURED'S ADHERENCE TO THE APPROVED WELLNESS PROGRAM.
  (f) "Municipal corporation" means within the state of New York, a city
[with  a  population  of less than one million or], a county outside the
city of New  York,  town,  village,  board  of  cooperative  educational
services, school district, A FIRE DISTRICT, a public library, as defined
in section two hundred fifty-three of the education law, or district, as
defined in section one hundred nineteen-n of the general municipal law.
  (I-1)  "STOP-LOSS  INSURANCE"  MEANS  AN  INSURANCE POLICY WHEREBY THE
INSURER AGREES TO PAY CLAIMS OR INDEMNIFY A  MUNICIPAL  CORPORATION  FOR
LOSSES  INCURRED  UNDER  A  MUNICIPAL COOPERATIVE HEALTH BENEFIT PLAN IN

A. 1448--A                          4

EXCESS OF SPECIFIED LOSS LIMITS FOR INDIVIDUAL  CLAIMS  AND/OR  FOR  ALL
CLAIMS COMBINED, OR ANY SIMILAR ARRANGEMENT.
  S  8.  Paragraphs  2  and  3  of subsection (a) of section 4704 of the
insurance law, paragraph 2 as amended by section 3 of part A of  chapter
494  of  the laws of 2009 and paragraph 3 as added by chapter 689 of the
laws of 1994, are amended to read as follows:
  (2) except for any plan that provided medical, surgical  and  hospital
services  on  or  before  January  first,  nineteen hundred ninety-three
pursuant to a municipal cooperation agreement, the number  of  municipal
corporations  participating  in the municipal cooperative health benefit
plan shall be at least [three] TWO;
  (3) except for any plan that provided medical, surgical  and  hospital
services  to  at  least three hundred fifty covered employees (including
retirees and not including dependents) on or before January first, nine-
teen hundred ninety-three pursuant to a municipal cooperation agreement,
the number of covered employees (including retirees  and  not  including
dependents)  of  municipal  corporations  participating in the municipal
cooperative health benefit plan shall be at least  [two  thousand]  FIVE
HUNDRED;
  S  9. Subsection (b) of section 4704 of the insurance law, as added by
chapter 689 of the laws of 1994, is amended to read as follows:
  (b) The superintendent shall refuse to grant a certificate of authori-
ty to an applicant that fails to meet the requirements of this  section.
Notice  of refusal shall be in writing and shall set forth the basis for
the refusal. If the applicant submits a written request within  [thirty]
SIXTY  days  after  receipt of the notice of refusal, the superintendent
shall promptly conduct a hearing to give the applicant  the  opportunity
to show cause why the refusal should not be made final.
  S  10.  Paragraphs 1, 2 and 5 of subsection (d) of section 4705 of the
insurance law, paragraphs 1 and 5 as added by chapter 689 of the laws of
1994 and paragraph 2 as amended by chapter 681 of the laws of 2002,  are
amended to read as follows:
  (1)  shall design the plan OR PLANS of benefits provided OR OFFERED by
the municipal cooperative health benefit plan and prepare the plan docu-
ment and summary plan description in accordance with section four  thou-
sand  seven  hundred  nine of this article, AND SHALL INCLUDE A WELLNESS
PROGRAM OPTION;
  (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  OR  PLANS,
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; AND
  (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 subdivi-
sion six of section ninety-two-a of the general municipal law].
  (5) shall prepare an  annual  budget  for  the  municipal  cooperative
health  benefit  plan  to  determine  the  premium  equivalent rates for

A. 1448--A                          5

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] BASIS 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;
  S 11. Subparagraphs (A) and (B) of paragraph 5 of  subsection  (a)  of
section  4706  of the insurance law, as added by chapter 689 of the laws
of 1994, are amended to read as follows:
  (A) five percent of the annualized earned premium  equivalents  during
the  current  fiscal year of a municipal cooperative health benefit plan
which consists of [five] TWO  or  more  participating  municipal  corpo-
rations  and  covers  [two  thousand] FIVE HUNDRED or more employees and
retirees; or
  (B) seven percent of the annualized earned premium equivalents  during
the current fiscal year of the municipal cooperative health benefit plan
which  consists  of  [four]  TWO or fewer participating municipal corpo-
rations or covers fewer than [two thousand] FIVE HUNDRED  employees  and
retirees.
  S 12. This act shall take effect on the first of January next succeed-
ing the date on which it shall have become a law.