S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                 9243--A

                       2009-2010 Regular Sessions

                          I N  A S S E M B L Y

                            November 9, 2009
                               ___________

Introduced  by  M.  of  A.  O'DONNELL  --  read once and referred to the
  Committee on Insurance -- recommitted to the Committee on Insurance in
  accordance 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 insurance law, in  relation  to  providing  enhanced
  consumer  protections  in  the event of an insurer's discontinuance of
  coverage

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

  Section  1.  Short  title. This act shall be known and may be cited as
"Ian's law".
  S 2. Paragraph 3 of subsection (p) of section 3221  of  the  insurance
law,  as added by chapter 661 of the laws of 1997, is amended to read as
follows:
  (3)(A) In any case in which an insurer decides to discontinue offering
a particular class of group or blanket policy of hospital,  surgical  or
medical  expense  insurance  offered in the small or large group market,
the policy of such class may be discontinued by the insurer  in  accord-
ance with this chapter in such market only if:
  (i)  the insurer provides written notice to each policyholder provided
coverage of this class in such market (and to all [participants] EMPLOY-
EES and [beneficiaries] MEMBER INSUREDS covered under such coverage)  of
such discontinuance at least ninety days prior to the date of discontin-
uance of such coverage.  THE WRITTEN NOTICE SHALL CONSPICUOUSLY INCLUDE:
  (I)  AN  EXPLANATION,  IN  PLAIN  LANGUAGE,  OF THE POLICYHOLDER'S AND
COVERED EMPLOYEE'S OR MEMBER INSURED'S RIGHTS UNDER THIS PARAGRAPH;
  (II) AN EXPLANATION THAT THE INSURER, IN DISCONTINUING OFFERING COVER-
AGE, MUST ACT UNIFORMLY WITHOUT REGARD TO THE CLAIMS EXPERIENCE  OF  THE
POLICYHOLDER OR ANY HEALTH STATUS-RELATED FACTOR RELATING TO ANY PARTIC-
ULAR  COVERED  EMPLOYEE,  MEMBER  INSURED OR DEPENDENT OR PARTICULAR NEW

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD14951-09-0
              

A. 9243--A                          2

EMPLOYEE, MEMBER INSURED OR DEPENDENT WHO MAY BECOME  ELIGIBLE  FOR  THE
COVERAGE;  AND THAT THE INSURER MAY NOT DISCONTINUE THE COVERAGE OF THIS
CLASS WITH THE INTENT OR AS A PRETEXT TO DISCONTINUING THE  COVERAGE  OF
ANY SUCH EMPLOYEE, MEMBER INSURED OR DEPENDENT;
  (III)  AN  EXPLANATION  AS TO HOW TO CONTACT THE SUPERINTENDENT IF THE
POLICYHOLDER, COVERED EMPLOYEE  OR  MEMBER  INSURED  BELIEVES  THAT  THE
INSURER  IS  DISCONTINUING THE COVERAGE OF THIS CLASS WITH THE INTENT OR
AS A PRETEXT TO DISCONTINUING THE COVERAGE  OF  ANY  PARTICULAR  COVERED
EMPLOYEE, MEMBER INSURED OR DEPENDENT OR PARTICULAR NEW EMPLOYEE, MEMBER
INSURED OR DEPENDENT WHO MAY BECOME ELIGIBLE FOR THE COVERAGE; AND
  (IV)  A  STATEMENT THAT, WITHIN NINETY DAYS AFTER THE INSURER MAILS OR
DELIVERS THE WRITTEN NOTICE OF DISCONTINUANCE REQUIRED BY THIS ITEM, THE
SUPERINTENDENT MAY ISSUE AN ORDER TO THE INSURER TO SUSPEND ITS  DISCON-
TINUANCE  OF THE CLASS OF POLICIES, PENDING A FINAL DETERMINATION OF THE
SUPERINTENDENT, IF THE SUPERINTENDENT RECEIVES EVIDENCE FROM  A  POLICY-
HOLDER OR COVERED EMPLOYEE OR MEMBER INSURED, OR OTHERWISE HAS REASON TO
BELIEVE,  THAT  THE  INSURER IS SEEKING TO DISCONTINUE COVERAGE WITH THE
INTENT OR AS A PRETEXT TO DISCONTINUING THE COVERAGE OF  ANY  PARTICULAR
COVERED  EMPLOYEE, MEMBER INSURED OR DEPENDENT DUE TO THE CLAIMS EXPERI-
ENCE OF THE POLICYHOLDER OR ANY HEALTH STATUS-RELATED FACTOR RELATING TO
ANY PARTICULAR COVERED EMPLOYEE, MEMBER INSURED OR DEPENDENT OR  PARTIC-
ULAR  NEW  EMPLOYEE, MEMBER INSURED OR DEPENDENT WHO MAY BECOME ELIGIBLE
FOR SUCH COVERAGE;
  (ii) the insurer offers to each policyholder provided coverage of this
class in such market, the option to purchase all (or, in the case of the
large group market, any) other hospital, surgical  and  medical  expense
coverage  currently  being  offered  by  the  insurer to a group in such
market; [and]
  (iii) in exercising the option to discontinue coverage of  this  class
and  in offering the option of coverage under item (ii) of this subpara-
graph, the insurer acts uniformly without regard to the  claims  experi-
ence of those policyholders or any health status-related factor relating
to  any  [insureds covered or new insureds] PARTICULAR COVERED EMPLOYEE,
MEMBER INSURED OR DEPENDENT OR PARTICULAR NEW EMPLOYEE,  MEMBER  INSURED
OR  DEPENDENT  who may become eligible for such coverage AND THE INSURER
IS NOT DISCONTINUING THE COVERAGE OF THIS CLASS WITH THE INTENT OR AS  A
PRETEXT  TO  DISCONTINUING  THE  COVERAGE  OF  ANY SUCH EMPLOYEE, MEMBER
INSURED OR DEPENDENT; AND
  (IV) AT LEAST NINETY DAYS PRIOR TO THE DATE OF DISCONTINUANCE OF  SUCH
COVERAGE,  THE  INSURER PROVIDES WRITTEN NOTICE TO THE SUPERINTENDENT OF
SUCH DISCONTINUANCE, AND AN OFFICER OR DIRECTOR OF THE INSURER CERTIFIES
TO THE SUPERINTENDENT THAT THE INSURER HAS COMPLIED WITH ITEMS (I), (II)
AND (III) OF THIS SUBPARAGRAPH. WITHIN SEVEN DAYS OF THE  COMPLETION  OF
THE  MAILING  OR  DELIVERY  OF  THE  NOTICE REQUIRED BY ITEM (I) OF THIS
SUBPARAGRAPH, THE INSURER SHALL NOTIFY THE SUPERINTENDENT OF THE DATE OR
DATES THAT THE INSURER MAILED OR DELIVERED THE NOTICE TO ALL POLICYHOLD-
ERS, COVERED EMPLOYEES, AND MEMBER INSUREDS.
  (B) IF, WITHIN NINETY DAYS AFTER THE INSURER  MAILS  OR  DELIVERS  THE
WRITTEN  NOTICE  OF  DISCONTINUANCE REQUIRED BY ITEM (I) OF SUBPARAGRAPH
(A) OF THIS PARAGRAPH, THE SUPERINTENDENT RECEIVES EVIDENCE FROM A POLI-
CYHOLDER OR COVERED EMPLOYEE OR MEMBER INSURED, OR OTHERWISE HAS  REASON
TO BELIEVE, THAT THE INSURER IS SEEKING TO DISCONTINUE COVERAGE WITH THE
INTENT  OR  AS A PRETEXT TO DISCONTINUING THE COVERAGE OF ANY PARTICULAR
COVERED EMPLOYEE, MEMBER INSURED OR DEPENDENT DUE TO THE CLAIMS  EXPERI-
ENCE OF THE POLICYHOLDER OR ANY HEALTH STATUS-RELATED FACTOR RELATING TO
ANY  PARTICULAR COVERED EMPLOYEE, MEMBER INSURED OR DEPENDENT OR PARTIC-

A. 9243--A                          3

ULAR NEW EMPLOYEE, MEMBER INSURED OR DEPENDENT WHO MAY  BECOME  ELIGIBLE
FOR SUCH COVERAGE:
  (I)  THE  SUPERINTENDENT  MAY ISSUE AN ORDER TO THE INSURER TO SUSPEND
ITS DISCONTINUANCE OF THE CLASS OF POLICIES, PENDING  A  FINAL  DETERMI-
NATION  OF  THE SUPERINTENDENT. IF THE SUPERINTENDENT ISSUES AN ORDER TO
SUSPEND ITS DISCONTINUANCE OF THE CLASS OF POLICIES,  THEN  THE  INSURER
SHALL  PROMPTLY  NOTIFY  EVERY POLICYHOLDER, COVERED EMPLOYEE AND MEMBER
INSURED;
  (II) THE SUPERINTENDENT SHALL REVIEW AND CONSIDER SUCH INFORMATION  AS
THE  SUPERINTENDENT  DEEMS  NECESSARY, INCLUDING THE CLAIM HISTORIES AND
PREMIUM RATES FOR EACH POLICY IN THE CLASS, THE HISTORICAL  PROFITS  AND
LOSSES  FOR THE CLASS OF POLICIES, AND ANY OTHER INFORMATION OR ANALYSIS
THE SUPERINTENDENT DEMANDS OR DEEMS RELEVANT;
  (III) THE SUPERINTENDENT SHALL  ISSUE  A  FINAL  DETERMINATION  WITHIN
NINETY  DAYS  OF ISSUING THE ORDER OF SUSPENSION; PROVIDED, HOWEVER, THE
SUPERINTENDENT MAY EXTEND THE TIME TO ISSUE THE FINAL  DETERMINATION  IF
THE  SUPERINTENDENT EXTENDS THE ORDER OF SUSPENSION UPON GOOD CAUSE; AND
PROVIDED FURTHER THAT IF THE SUPERINTENDENT DETERMINES THAT  AN  INSURER
WAS SEEKING TO DISCONTINUE COVERAGE WITH THE INTENT OR PRETEXT DESCRIBED
IN  SUBPARAGRAPH  (A)  OF  THIS  PARAGRAPH,  THEN  THE INSURER SHALL NOT
DISCONTINUE THE CLASS OF POLICIES AND SHALL PROMPTLY NOTIFY EVERY  POLI-
CYHOLDER, COVERED EMPLOYEE AND MEMBER INSURED; AND
  (IV) THE SUPERINTENDENT MAY HOLD A HEARING IF THE SUPERINTENDENT DEEMS
IT  NECESSARY AND SHALL HOLD A HEARING IF THE INSURER REQUESTS A HEARING
AT ANY TIME BEFORE THE SUPERINTENDENT ISSUES THE FINAL DETERMINATION.
  (C) WHERE AN INSURER DISCONTINUES A PARTICULAR CLASS OF GROUP OR BLAN-
KET POLICY OF HOSPITAL, SURGICAL OR MEDICAL EXPENSE INSURANCE OFFERED IN
THE SMALL OR LARGE GROUP MARKET, OTHER THAN IN THE MANNER PRESCRIBED  BY
SUBPARAGRAPH  (A)  OF THIS PARAGRAPH, THE INSURER SHALL BE LIABLE TO THE
FORMER POLICYHOLDER OR TO THE COVERED EMPLOYEE, MEMBER INSURED,  DEPEND-
ENT OR TO THE ESTATE THEREOF, FOR COMPENSATORY DAMAGES ARISING FROM SUCH
UNLAWFUL  DISCONTINUANCE,  PLUS COSTS AND REASONABLE ATTORNEYS' FEES, IN
AN ACTION COMMENCED NO LATER THAN TWO  YEARS  AFTER  THE  DATE  OF  SUCH
DISCONTINUANCE.  IN ANY SUCH ACTION, THE COURT MAY GRANT SUCH INJUNCTIVE
RELIEF AS THE COURT MAY DEEM PROPER.
  (D) In any case in which an insurer elects to discontinue offering all
hospital, surgical and medical  expense  coverage  in  the  small  group
market or the large group market, or both markets, in this state, health
insurance coverage may be discontinued by the insurer only if:
  (i)  the  insurer provides written notice to the superintendent and to
each policyholder (and [participants and  beneficiaries]  ALL  EMPLOYEES
AND  MEMBER INSUREDS covered under such coverage) of such discontinuance
at least one hundred eighty days prior to the date of the discontinuance
of such coverage;
  (ii) all hospital, surgical and medical  expense  coverage  issued  or
delivered  for  issuance  in  this  state in such market (or markets) is
discontinued and  coverage  under  such  policies  in  such  market  (or
markets) is not renewed; and
  (iii)  in  addition to the notice to the superintendent referred to in
item (i) of this subparagraph, the insurer must provide the  superinten-
dent with a written plan to minimize potential disruption in the market-
place occasioned by its withdrawal from the market.
  [(C)] (E) In the case of a discontinuance under subparagraph [(B)] (D)
of this paragraph in a market, the insurer may not provide for the issu-
ance  of  any  group  or blanket policy of hospital, surgical or medical
expense insurance in that market in this  state  during  the  five  year

A. 9243--A                          4

period  beginning  on  the date of the discontinuance of the last health
insurance policy not so renewed.
  (F)  IF  AN INSURER DECIDES OR ELECTS TO DISCONTINUE OFFERING COVERAGE
PURSUANT TO SUBPARAGRAPH (A) OR (D) OF THIS PARAGRAPH, THEN THE  INSURER
SHALL  PROVIDE AN EXTENDED BENEFIT DURING TOTAL DISABILITY, WITH RESPECT
TO THE SICKNESS, INJURY OR PREGNANCY THAT CAUSED THE DISABILITY,  OF  AT
LEAST  EIGHTEEN  MONTHS SUBSEQUENT TO DISCONTINUANCE OF INSURANCE UNLESS
SIMILAR COVERAGE IS AFFORDED FOR  THE  TOTAL  DISABILITY  UNDER  ANOTHER
GROUP OR BLANKET POLICY.
  S  3.  Paragraph  3 of subsection (j) of section 4305 of the insurance
law, as added by chapter 661 of the laws of 1997, is amended to read  as
follows:
  (3)(A)  In  any  case  in  which  a corporation decides to discontinue
offering a particular class of group or blanket  contract  of  hospital,
surgical  or  medical  expense  insurance  offered in the small or large
group market, the contract of such class  may  be  discontinued  by  the
corporation in accordance with this chapter in such market only if:
  (i)  the  corporation  provides written notice to each contract holder
provided coverage of this class in such  market  (and  to  all  [partic-
ipants] EMPLOYEES and [beneficiaries] MEMBER INSUREDS covered under such
coverage)  of such discontinuance at least ninety days prior to the date
of discontinuance of such coverage. THE WRITTEN NOTICE  SHALL  CONSPICU-
OUSLY INCLUDE:
  (I)  AN  EXPLANATION,  IN PLAIN LANGUAGE, OF THE CONTRACT HOLDER'S AND
COVERED EMPLOYEE'S OR MEMBER INSURED'S RIGHTS UNDER THIS PARAGRAPH;
  (II) AN EXPLANATION THAT THE CORPORATION,  IN  DISCONTINUING  OFFERING
COVERAGE,  MUST ACT UNIFORMLY WITHOUT REGARD TO THE CLAIMS EXPERIENCE OF
THE CONTRACT HOLDER OR ANY HEALTH STATUS-RELATED FACTOR RELATING TO  ANY
PARTICULAR  COVERED  EMPLOYEE, MEMBER INSURED OR DEPENDENT OR PARTICULAR
NEW EMPLOYEE, MEMBER INSURED OR DEPENDENT WHO MAY  BECOME  ELIGIBLE  FOR
THE  COVERAGE; AND THAT THE CORPORATION MAY NOT DISCONTINUE THE COVERAGE
OF THIS CLASS WITH THE INTENT OR  AS  A  PRETEXT  TO  DISCONTINUING  THE
COVERAGE OF ANY SUCH EMPLOYEE, MEMBER INSURED OR DEPENDENT;
  (III)  AN  EXPLANATION  AS TO HOW TO CONTACT THE SUPERINTENDENT IF THE
CONTRACT HOLDER, COVERED EMPLOYEE OR MEMBER INSURED  BELIEVES  THAT  THE
CORPORATION  IS DISCONTINUING THE COVERAGE OF THIS CLASS WITH THE INTENT
OR AS A PRETEXT TO DISCONTINUING THE COVERAGE OF ANY PARTICULAR  COVERED
EMPLOYEE, MEMBER INSURED OR DEPENDENT OR PARTICULAR NEW EMPLOYEE, MEMBER
INSURED OR DEPENDENT WHO MAY BECOME ELIGIBLE FOR THE COVERAGE; AND
  (IV)  A STATEMENT THAT, WITHIN NINETY DAYS AFTER THE CORPORATION MAILS
OR DELIVERS THE WRITTEN NOTICE OF DISCONTINUANCE REQUIRED BY THIS  ITEM,
THE  SUPERINTENDENT MAY ISSUE AN ORDER TO THE CORPORATION TO SUSPEND ITS
DISCONTINUANCE OF THE CLASS OF CONTRACTS, PENDING A FINAL  DETERMINATION
OF  THE  SUPERINTENDENT,  IF THE SUPERINTENDENT RECEIVES EVIDENCE FROM A
CONTRACT HOLDER OR COVERED EMPLOYEE OR MEMBER INSURED, OR OTHERWISE  HAS
REASON TO BELIEVE, THAT THE CORPORATION IS SEEKING TO DISCONTINUE COVER-
AGE WITH THE INTENT OR AS A PRETEXT TO DISCONTINUING THE COVERAGE OF ANY
PARTICULAR  COVERED  EMPLOYEE,  MEMBER  INSURED  OR DEPENDENT DUE TO THE
CLAIMS EXPERIENCE OF THE CONTRACT HOLDER OR  ANY  HEALTH  STATUS-RELATED
FACTOR  RELATING  TO  ANY PARTICULAR COVERED EMPLOYEE, MEMBER INSURED OR
DEPENDENT OR PARTICULAR NEW EMPLOYEE, MEMBER INSURED  OR  DEPENDENT  WHO
MAY BECOME ELIGIBLE FOR SUCH COVERAGE;
  (ii)  the corporation offers to each contract holder provided coverage
of this class in such market, the option to purchase  all  (or,  in  the
case  of  the  large  group  market,  any)  other hospital, surgical and

A. 9243--A                          5

medical expense coverage currently being offered by the corporation to a
group in such market; [and]
  (iii)  in  exercising the option to discontinue coverage of this class
and in offering the option of coverage under item (ii) of this  subpara-
graph, the corporation acts uniformly without regard to the claims expe-
rience  of  those  contract  holders or any health status-related factor
relating to any [subscribers  covered  or  new  subscribers]  PARTICULAR
COVERED  EMPLOYEE, MEMBER INSURED OR DEPENDENT OR PARTICULAR NEW EMPLOY-
EE, MEMBER INSURED OR DEPENDENT who may become eligible for such  cover-
age  AND THE CORPORATION IS NOT DISCONTINUING THE COVERAGE OF THIS CLASS
WITH THE INTENT OR AS A PRETEXT TO DISCONTINUING  THE  COVERAGE  OF  ANY
SUCH EMPLOYEE, MEMBER INSURED OR DEPENDENT; AND
  (IV)  AT LEAST NINETY DAYS PRIOR TO THE DATE OF DISCONTINUANCE OF SUCH
COVERAGE, THE CORPORATION PROVIDES WRITTEN NOTICE TO THE  SUPERINTENDENT
OF  SUCH  DISCONTINUANCE,  AND AN OFFICER OR DIRECTOR OF THE CORPORATION
CERTIFIES TO THE SUPERINTENDENT THAT THE CORPORATION HAS  COMPLIED  WITH
ITEMS (I), (II) AND (III) OF THIS SUBPARAGRAPH. WITHIN SEVEN DAYS OF THE
COMPLETION OF THE MAILING OR DELIVERY OF THE NOTICE REQUIRED BY ITEM (I)
OF THIS SUBPARAGRAPH, THE CORPORATION SHALL NOTIFY THE SUPERINTENDENT OF
THE DATE OR DATES THAT THE CORPORATION MAILED OR DELIVERED THE NOTICE TO
ALL CONTRACT HOLDERS, COVERED EMPLOYEES, AND MEMBER INSUREDS.
  (B) IF, WITHIN NINETY DAYS AFTER THE CORPORATION MAILS OR DELIVERS THE
WRITTEN  NOTICE  OF  DISCONTINUANCE REQUIRED BY ITEM (I) OF SUBPARAGRAPH
(A) OF THIS PARAGRAPH,  THE  SUPERINTENDENT  RECEIVES  EVIDENCE  FROM  A
CONTRACT  HOLDER OR COVERED EMPLOYEE OR MEMBER INSURED, OR OTHERWISE HAS
REASON TO BELIEVE, THAT THE CORPORATION IS SEEKING TO DISCONTINUE COVER-
AGE WITH THE INTENT OR AS A PRETEXT TO DISCONTINUING THE COVERAGE OF ANY
PARTICULAR COVERED EMPLOYEE, MEMBER INSURED  OR  DEPENDENT  DUE  TO  THE
CLAIMS  EXPERIENCE  OF  THE CONTRACT HOLDER OR ANY HEALTH STATUS-RELATED
FACTOR RELATING TO ANY PARTICULAR COVERED EMPLOYEE,  MEMBER  INSURED  OR
DEPENDENT  OR  PARTICULAR  NEW EMPLOYEE, MEMBER INSURED OR DEPENDENT WHO
MAY BECOME ELIGIBLE FOR SUCH COVERAGE:
  (I) THE SUPERINTENDENT MAY  ISSUE  AN  ORDER  TO  THE  CORPORATION  TO
SUSPEND  ITS  DISCONTINUANCE  OF THE CLASS OF CONTRACTS, PENDING A FINAL
DETERMINATION OF THE SUPERINTENDENT. IF  THE  SUPERINTENDENT  ISSUES  AN
ORDER  TO SUSPEND ITS DISCONTINUANCE OF THE CLASS OF CONTRACTS, THEN THE
CORPORATION SHALL PROMPTLY NOTIFY EVERY CONTRACT HOLDER, COVERED EMPLOY-
EE AND MEMBER INSURED;
  (II) THE SUPERINTENDENT SHALL REVIEW AND CONSIDER SUCH INFORMATION  AS
THE  SUPERINTENDENT  DEEMS  NECESSARY, INCLUDING THE CLAIM HISTORIES AND
PREMIUM RATES FOR EACH CONTRACT IN THE CLASS, THE HISTORICAL PROFITS AND
LOSSES FOR THE CLASS OF CONTRACTS, AND ANY OTHER INFORMATION OR ANALYSIS
THE SUPERINTENDENT DEMANDS OR DEEMS RELEVANT;
  (III) THE SUPERINTENDENT SHALL  ISSUE  A  FINAL  DETERMINATION  WITHIN
NINETY  DAYS  OF ISSUING THE ORDER OF SUSPENSION; PROVIDED, HOWEVER, THE
SUPERINTENDENT MAY EXTEND THE TIME TO ISSUE THE FINAL  DETERMINATION  IF
THE  SUPERINTENDENT EXTENDS THE ORDER OF SUSPENSION UPON GOOD CAUSE; AND
PROVIDED FURTHER THAT IF THE SUPERINTENDENT  DETERMINES  THAT  A  CORPO-
RATION  WAS  SEEKING  TO DISCONTINUE COVERAGE WITH THE INTENT OR PRETEXT
DESCRIBED IN SUBPARAGRAPH (A) OF THIS PARAGRAPH,  THEN  THE  CORPORATION
SHALL  NOT  DISCONTINUE THE CLASS OF CONTRACTS AND SHALL PROMPTLY NOTIFY
EVERY CONTRACT HOLDER, COVERED EMPLOYEE AND MEMBER INSURED; AND
  (IV) THE SUPERINTENDENT MAY HOLD A HEARING IF THE SUPERINTENDENT DEEMS
IT NECESSARY AND SHALL HOLD A HEARING  IF  THE  CORPORATION  REQUESTS  A
HEARING  AT ANY TIME BEFORE THE SUPERINTENDENT ISSUES THE FINAL DETERMI-
NATION.

A. 9243--A                          6

  (C) WHERE A CORPORATION DISCONTINUES A PARTICULAR CLASS  OF  GROUP  OR
BLANKET  CONTRACT  OF  HOSPITAL,  SURGICAL  OR MEDICAL EXPENSE INSURANCE
OFFERED IN THE SMALL OR LARGE GROUP MARKET, OTHER  THAN  IN  THE  MANNER
PRESCRIBED  BY SUBPARAGRAPH (A) OF THIS PARAGRAPH, THE CORPORATION SHALL
BE  LIABLE  TO  THE  FORMER  CONTRACT HOLDER OR TO THE COVERED EMPLOYEE,
MEMBER INSURED, DEPENDENT OR TO THE  ESTATE  THEREOF,  FOR  COMPENSATORY
DAMAGES  ARISING  FROM  SUCH  UNLAWFUL  DISCONTINUANCE,  PLUS  COSTS AND
REASONABLE ATTORNEYS' FEES, IN AN ACTION COMMENCED  NO  LATER  THAN  TWO
YEARS  AFTER  THE  DATE  OF SUCH DISCONTINUANCE. IN ANY SUCH ACTION, THE
COURT MAY GRANT SUCH INJUNCTIVE RELIEF AS THE COURT MAY DEEM PROPER.
  (D) In any case in which a corporation elects to discontinue  offering
all  hospital,  surgical and medical expense coverage in the small group
market or the large group market, or both markets, in this state, health
insurance coverage may be discontinued by the corporation only if:
  (i) the corporation provides written notice to the superintendent  and
to  each  contract  holder  (and  [participants  and  beneficiaries] ALL
EMPLOYEES AND MEMBER INSUREDS  covered  under  such  coverage)  of  such
discontinuance at least one hundred eighty days prior to the date of the
discontinuance of such coverage;
  (ii)  all  hospital,  surgical  and medical expense coverage issued or
delivered for issuance in this  state  in  such  market  or  markets  is
discontinued and coverage under such contracts in such market or markets
is not renewed; and
  (iii)  in  addition to the notice to the superintendent referred to in
item (i) of this subparagraph, the corporation must provide  the  super-
intendent  with  a  written plan to minimize potential disruption in the
marketplace occasioned by its withdrawal from the market.
  [(C)] (E) In the case of a discontinuance under subparagraph [(B)] (D)
of this paragraph in a market, the corporation may not provide  for  the
issuance  of  any  group  or  blanket  contract of hospital, surgical or
medical expense insurance in that market in this state during the  five-
year  period  beginning  on  the  date of the discontinuance of the last
health insurance contract not so renewed.
  (F) IF A CORPORATION DECIDES OR ELECTS TO DISCONTINUE OFFERING  COVER-
AGE  PURSUANT  TO  SUBPARAGRAPH  (A)  OR (D) OF THIS PARAGRAPH, THEN THE
CORPORATION SHALL PROVIDE AN EXTENDED BENEFIT DURING  TOTAL  DISABILITY,
WITH  RESPECT TO THE SICKNESS, INJURY OR PREGNANCY THAT CAUSED THE DISA-
BILITY, OF AT LEAST EIGHTEEN  MONTHS  SUBSEQUENT  TO  DISCONTINUANCE  OF
INSURANCE  UNLESS  SIMILAR COVERAGE IS AFFORDED FOR THE TOTAL DISABILITY
UNDER ANOTHER GROUP OR BLANKET CONTRACT.
  S 4. This act shall take effect on the first of January next  succeed-
ing  the date on which it shall have become a law and shall apply to all
policies and contracts issued, renewed, modified, altered or amended  on
or after such effective date.

                            
                    S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                 9243--B

                       2009-2010 Regular Sessions

                          I N  A S S E M B L Y

                            November 9, 2009
                               ___________

Introduced  by  M.  of  A.  O'DONNELL  --  read once and referred to the
  Committee on Insurance -- recommitted to the Committee on Insurance in
  accordance with Assembly Rule 3, sec. 2 -- committee discharged,  bill
  amended,  ordered reprinted as amended and recommitted to said commit-
  tee -- again reported from said  committee  with  amendments,  ordered
  reprinted as amended and recommitted to said committee

AN  ACT  to  amend  the insurance law, in relation to providing enhanced
  consumer protections in the event of an  insurer's  discontinuance  of
  coverage

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

  Section 1. Short title. This act shall be known and may  be  cited  as
"Ian's law".
  S  2.  Paragraph  3 of subsection (p) of section 3221 of the insurance
law, as added by chapter 661 of the laws of 1997, is amended to read  as
follows:
  (3)(A) In any case in which an insurer decides to discontinue offering
a  particular  class of group or blanket policy of hospital, surgical or
medical expense insurance offered in the small or  large  group  market,
the  policy  of such class may be discontinued by the insurer in accord-
ance with this chapter in such market only if:
  (i) the insurer provides written notice to each policyholder  provided
coverage of this class in such market (and to all [participants] EMPLOY-
EES  and [beneficiaries] MEMBER INSUREDS covered under such coverage) of
such discontinuance at least ninety days prior to the date of discontin-
uance of such coverage. IN ADDITION TO ANY OTHER INFORMATION REQUIRED OF
NOTICES BY THE SUPERINTENDENT, THIS WRITTEN NOTICE  SHALL  CONSPICUOUSLY
INCLUDE  AN  EXPLANATION,  IN  PLAIN LANGUAGE, OF THE POLICYHOLDER'S AND
COVERED EMPLOYEE'S OR MEMBER INSURED'S RIGHTS  UNDER  THIS  SUBPARAGRAPH
AND (B) OF THIS PARAGRAPH, INCLUDING:

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD14951-15-0

              

A. 9243--B                          2

  (I) A STATEMENT THAT IF THE SUPERINTENDENT DETERMINES THAT THE COVERED
EMPLOYEE,  MEMBER  INSURED,  OR A DEPENDENT HAS A SERIOUS MEDICAL CONDI-
TION, AND THE COVERED EMPLOYEE, MEMBER INSURED OR DEPENDENT  WITHIN  THE
PREVIOUS  TWELVE  MONTHS  UTILIZED A BENEFIT UNDER THE POLICY RELATED TO
THE  SERIOUS  MEDICAL  CONDITION  THAT IS NOT COVERED BY THE REPLACEMENT
COVERAGE OFFERED TO THE POLICYHOLDER AS A RESULT OF THE  DISCONTINUANCE,
THEN  THE  SUPERINTENDENT SHALL REQUIRE THE INSURER TO OFFER THE POLICY-
HOLDER REPLACEMENT COVERAGE THAT INCLUDES A BENEFIT THAT IS THE SAME  AS
OR SUBSTANTIALLY SIMILAR TO THE BENEFIT SET FORTH IN THE POLICY THAT THE
INSURER DISCONTINUED; AND
  (II)  AN  EXPLANATION AS TO HOW TO CONTACT THE SUPERINTENDENT, AND THE
DATE BY WHICH THE SUPERINTENDENT SHALL BE CONTACTED, IF THE  POLICYHOLD-
ER, COVERED EMPLOYEE OR MEMBER INSURED BELIEVES THAT THE COVERED EMPLOY-
EE,  MEMBER  INSURED OR A DEPENDENT HAS A SERIOUS MEDICAL CONDITION, AND
THE COVERED EMPLOYEE, MEMBER INSURED OR DEPENDENT  WITHIN  THE  PREVIOUS
TWELVE  MONTHS  UTILIZED A BENEFIT RELATED TO THE SERIOUS MEDICAL CONDI-
TION THAT MAY NOT BE COVERED BY THE REPLACEMENT COVERAGE OFFERED TO  THE
POLICYHOLDER AS A RESULT OF THE DISCONTINUANCE;
  (ii) the insurer offers to each policyholder provided coverage of this
class in such market, the option to purchase all (or, in the case of the
large  group  market,  any) other hospital, surgical and medical expense
coverage currently being offered by the  insurer  to  a  group  in  such
market; [and]
  (iii)  in  exercising the option to discontinue coverage of this class
and in offering the option of coverage under item (ii) of this  subpara-
graph,  the  insurer acts uniformly without regard to the claims experi-
ence of those policyholders or any health status-related factor relating
to any [insureds covered or new insureds] PARTICULAR  COVERED  EMPLOYEE,
MEMBER  INSURED  OR DEPENDENT OR PARTICULAR NEW EMPLOYEE, MEMBER INSURED
OR DEPENDENT who may become eligible for such coverage, AND THE  INSURER
IS  NOT DISCONTINUING THE COVERAGE OF THIS CLASS WITH THE INTENT OR AS A
PRETEXT TO DISCONTINUING THE  COVERAGE  OF  ANY  SUCH  EMPLOYEE,  MEMBER
INSURED OR DEPENDENT; AND
  (IV)  AT LEAST NINETY DAYS PRIOR TO THE DATE OF DISCONTINUANCE OF SUCH
COVERAGE, THE INSURER PROVIDES WRITTEN NOTICE TO THE  SUPERINTENDENT  OF
SUCH DISCONTINUANCE, INCLUDING THE REASON FOR THE DISCONTINUANCE, AND AN
OFFICER  OR DIRECTOR OF THE INSURER CERTIFIES TO THE SUPERINTENDENT THAT
THE INSURER HAS COMPLIED WITH ITEMS (I), (II) AND (III)  OF  THIS  PARA-
GRAPH. IF SUCH NOTICE DOES NOT INCLUDE THE DATE OR DATES THAT THE INSUR-
ER  MAILED OR DELIVERED THE NOTICE TO ALL POLICYHOLDERS, COVERED EMPLOY-
ERS AND MEMBER INSUREDS, THE INSURER SHALL NOTIFY THE SUPERINTENDENT  OF
SUCH  DATE  WITHIN  SEVEN  DAYS  OF  THE  COMPLETION  OF  THE MAILING OR
DELIVERY.
  (B) IF THE SUPERINTENDENT DETERMINES THAT THE INSURER HAS NOT COMPLIED
WITH ITEM (III) OF SUBPARAGRAPH (A) OF THIS PARAGRAPH, THEN  THE  SUPER-
INTENDENT MAY PROHIBIT THE INSURER FROM DISCONTINUING THE CLASS OF POLI-
CIES  AND  REQUIRE  THE  INSURER  TO PROMPTLY NOTIFY EVERY POLICYHOLDER,
COVERED EMPLOYEE AND MEMBER INSURED THAT THE INSURER IS NOT  DISCONTINU-
ING  THE  POLICIES.  IF  THE  SUPERINTENDENT DETERMINES THAT THE INSURER
WRONGFULLY DISCONTINUED THE CLASS OF POLICIES PURSUANT TO ITEM (III)  OF
SUBPARAGRAPH (A), THEN THE SUPERINTENDENT SHALL REQUIRE THAT THE INSURER
TAKE  REMEDIAL  ACTION,  INCLUDING  OFFERING  TO GROUP POLICYHOLDERS THE
OPTION OF REINSTATING THE DISCONTINUED POLICY FORMS. IF THE  SUPERINTEN-
DENT  DETERMINES  THAT  THE  INSURER  DISCONTINUED THE CLASS OF POLICIES
WITHOUT COMPLIANCE WITH ITEMS (I), (II), OR (IV)  OF  SUBPARAGRAPH  (A),
AND  AN  EMPLOYEE, MEMBER INSURED OR DEPENDENT COVERED UNDER THE DISCON-

A. 9243--B                          3

TINUED POLICY WOULD HAVE BEEN ENTITLED TO RELIEF UNDER  THIS  PARAGRAPH,
THEN  THE  SUPERINTENDENT MAY REQUIRE THAT THE INSURER OFFER REPLACEMENT
COVERAGE TO AN  AFFECTED  POLICYHOLDER  CONSISTENT  WITH  ITEM  (II)  OF
SUBPARAGRAPH (C) OF THIS PARAGRAPH.
  (C) (I) IF, WITHIN FORTY-FIVE DAYS AFTER THE INSURER MAILS OR DELIVERS
THE  WRITTEN  NOTICE  OF DISCONTINUANCE REQUIRED BY ITEM (I) OF SUBPARA-
GRAPH (A) OF THIS PARAGRAPH, THE SUPERINTENDENT IS NOTIFIED BY A POLICY-
HOLDER OR COVERED EMPLOYEE OR MEMBER INSURED THAT  A  COVERED  EMPLOYEE,
MEMBER  INSURED  OR DEPENDENT HAS A SERIOUS MEDICAL CONDITION AND THAT A
BENEFIT UTILIZED BY THE COVERED EMPLOYEE, MEMBER  INSURED  OR  DEPENDENT
WITHIN  THE PREVIOUS TWELVE MONTHS RELATED TO THE SERIOUS MEDICAL CONDI-
TION MAY NOT BE COVERED BY THE REPLACEMENT COVERAGE OFFERED TO THE POLI-
CYHOLDER AS A RESULT OF  THE  DISCONTINUANCE,  THEN  THE  SUPERINTENDENT
SHALL,  WITHIN  TWENTY  DAYS  OF  THE  NOTIFICATION,  ASK THE INSURER TO
CONFIRM THAT THE COVERED EMPLOYEE, MEMBER INSURED OR DEPENDENT UTILIZE A
BENEFIT WITHIN THE PREVIOUS TWELVE MONTHS TO TREAT THE MEDICAL CONDITION
THAT THE COVERED EMPLOYEE, MEMBER INSURED  OR  DEPENDENT  ASSERTS  IS  A
SERIOUS  MEDICAL  CONDITION,  AND THAT THE BENEFIT IS NOT COVERED BY THE
REPLACEMENT COVERAGE. THE SUPERINTENDENT  MAY  REQUEST  SUCH  ADDITIONAL
INFORMATION AS THE SUPERINTENDENT MAY REQUIRE. THE INSURER SHALL PROVIDE
ALL  REQUESTED  INFORMATION  TO  THE  SUPERINTENDENT WITHIN FIVE DAYS OF
RECEIPT OF THE REQUEST.
  (II) IF, WITHIN TWENTY DAYS OF THE  SUPERINTENDENT'S  RECEIPT  OF  ALL
ADDITIONAL  INFORMATION  REQUESTED  FROM THE INSURER, THE SUPERINTENDENT
DETERMINES THAT (I) THE COVERED EMPLOYEE, MEMBER  INSURED  OR  DEPENDENT
HAS  A  SERIOUS  MEDICAL CONDITION; AND (II) THE BENEFIT UTILIZED BY THE
COVERED EMPLOYEE, MEMBER INSURED OR DEPENDENT WITHIN THE PREVIOUS TWELVE
MONTHS RELATED TO THE SERIOUS MEDICAL CONDITION IS NOT  COVERED  BY  THE
REPLACEMENT  COVERAGE  OFFERED  TO  THE  POLICYHOLDER AS A RESULT OF THE
DISCONTINUANCE, THEN THE SUPERINTENDENT SHALL  REQUIRE  THE  INSURER  TO
OFFER  TO  THE POLICYHOLDER REPLACEMENT COVERAGE THAT INCLUDES A BENEFIT
THAT IS THE SAME AS OR SUBSTANTIALLY SIMILAR TO THE BENEFIT SET FORTH IN
THE POLICY THAT THE INSURER DISCONTINUED. IF THE REPLACEMENT COVERAGE IS
NOT AVAILABLE, AT THE TIME THAT THE POLICY WOULD OTHERWISE BE DISCONTIN-
UED, THEN THE INSURER SHALL KEEP THE EXISTING POLICY IN  FORCE  FOR  THE
AFFECTED  POLICYHOLDER  UNTIL THE REPLACEMENT COVERAGE WITH THE SUBSTAN-
TIALLY SIMILAR BENEFIT IS AVAILABLE.
  (D) THE REMEDIES AS PROVIDED IN THIS PARAGRAPH SHALL BE IN ADDITION TO
AND NOT IN LIEU OF ANY OTHER AUTHORITY OR POWER OF THE SUPERINTENDENT TO
IMPOSE MONETARY OR OTHER PENALTIES FOR VIOLATIONS OF THIS PARAGRAPH.
  [(B)] (E) In any case in which an insurer elects to discontinue offer-
ing all hospital, surgical and medical expense  coverage  in  the  small
group  market or the large group market, or both markets, in this state,
health insurance coverage may be discontinued by the insurer only if:
  (i) the insurer provides written notice to the superintendent  and  to
each  policyholder  (and  [participants and beneficiaries] ALL EMPLOYEES
AND MEMBER INSUREDS covered under such coverage) of such  discontinuance
at least one hundred eighty days prior to the date of the discontinuance
of such coverage;
  (ii)  all  hospital,  surgical  and medical expense coverage issued or
delivered for issuance in this state in  such  market  (or  markets)  is
discontinued  and  coverage  under  such  policies  in  such  market (or
markets) is not renewed; and
  (iii) in addition to the notice to the superintendent referred  to  in
item  (i)  of  this  subparagraph,  the insurer [must] SHALL provide the
superintendent with a written plan to minimize potential  disruption  in

A. 9243--B                          4

the  marketplace  occasioned  by [its] THE INSURER'S withdrawal from the
market.
  [(C)]  (F) In the case of a discontinuance under subparagraph [(B)] (E
of this paragraph in a market, the insurer may not provide for the issu-
ance of any group or blanket policy of  hospital,  surgical  or  medical
expense  insurance  in  that  market  in this state during the five year
period beginning on the date of the discontinuance of  the  last  health
insurance policy not so renewed.
  S  3.  Paragraph  3 of subsection (j) of section 4305 of the insurance
law, as added by chapter 661 of the laws of 1997, is amended to read  as
follows:
  (3)  (A)  In  any  case  in which a corporation decides to discontinue
offering a particular class of group or blanket  contract  of  hospital,
surgical  or  medical  expense  insurance  offered in the small or large
group market, the contract of such class  may  be  discontinued  by  the
corporation in accordance with this chapter in such market only if:
  (i)  the  corporation  provides written notice to each contract holder
provided coverage of this class in such  market  (and  to  all  [partic-
ipants] EMPLOYEES and [beneficiaries] MEMBER INSUREDS covered under such
coverage)  of such discontinuance at least ninety days prior to the date
of discontinuance of such coverage. IN ADDITION TO ANY OTHER INFORMATION
REQUIRED OF NOTICES BY THE SUPERINTENDENT,  THIS  WRITTEN  NOTICE  SHALL
CONSPICUOUSLY INCLUDE AN EXPLANATION, IN PLAIN LANGUAGE, OF THE CONTRACT
HOLDER'S  AND  COVERED  EMPLOYEE'S OR MEMBER INSURED'S RIGHTS UNDER THIS
SUBPARAGRAPH AND SUBPARAGRAPH (B) OF THIS PARAGRAPH, INCLUDING:
  (I) A STATEMENT THAT IF THE SUPERINTENDENT DETERMINES THAT THE COVERED
EMPLOYEE, MEMBER INSURED, OR A DEPENDENT HAS A  SERIOUS  MEDICAL  CONDI-
TION,  AND  THE COVERED EMPLOYEE, MEMBER INSURED OR DEPENDENT WITHIN THE
PREVIOUS TWELVE MONTHS UTILIZED A BENEFIT UNDER; THE CONTRARY RELATED TO
THE SERIOUS MEDICAL CONDITION THAT IS NOT  COVERED  BY  THE  REPLACEMENT
COVERAGE  OFFERED  TO  THE CONTRACT HOLDER AS A RESULT OF THE DISCONTIN-
UANCE, THEN THE SUPERINTENDENT SHALL REQUIRE THE  CORPORATION  TO  OFFER
THE CONTRACT HOLDER REPLACEMENT COVERAGE THAT INCLUDES A BENEFIT THAT IS
THE  SAME  AS  OR  SUBSTANTIALLY SIMILAR TO THE BENEFIT SET FORTH IN THE
CONTRACT THAT THE CORPORATION DISCONTINUED; AND
  (II) AN EXPLANATION AS TO HOW TO CONTACT THE SUPERINTENDENT,  AND  THE
DATE  BY  WHICH  THE  SUPERINTENDENT SHALL BE CONTACTED, IF THE CONTRACT
HOLDER, COVERED EMPLOYEE OR MEMBER INSURED  BELIEVES  THAT  THE  COVERED
EMPLOYEE, MEMBER INSURED OR A DEPENDENT HAS A SERIOUS MEDICAL CONDITION,
AND  THE COVERED EMPLOYEE, MEMBER INSURED OR DEPENDENT WITHIN THE PREVI-
OUS TWELVE MONTHS UTILIZED A BENEFIT  RELATED  TO  THE  SERIOUS  MEDICAL
CONDITION THAT MAY NOT BE COVERED BY THE REPLACEMENT COVERAGE OFFERED TO
THE CONTRACT HOLDER AS A RESULT OF THE DISCONTINUANCE;
  (ii)  the corporation offers to each contract holder provided coverage
of this class in such market, the option to purchase  all  (or,  in  the
case  of  the  large  group  market,  any)  other hospital, surgical and
medical expense coverage currently being offered by the corporation to a
group in such market; [and]
  (iii) in exercising the option to discontinue coverage of  this  class
and  in offering the option of coverage under item (ii) of this subpara-
graph, the corporation acts uniformly without regard to the claims expe-
rience of those contract holders or  any  health  status-related  factor
relating  to  any  [subscribers  covered  or new subscribers] PARTICULAR
COVERED EMPLOYEE, MEMBER INSURED OR DEPENDENT who  may  become  eligible
for such coverage, AND THE CORPORATION IS NOT DISCONTINUING THE COVERAGE

A. 9243--B                          5

OF  THIS  CLASS  WITH  THE  INTENT  OR AS A PRETEXT TO DISCONTINUING THE
COVERAGE OF ANY SUCH EMPLOYEE, MEMBER INSURED OR DEPENDENT; AND
  (IV)  AT LEAST NINETY DAYS PRIOR TO THE DATE OF DISCONTINUANCE OF SUCH
COVERAGE, THE CORPORATION PROVIDES WRITTEN NOTICE TO THE  SUPERINTENDENT
OF SUCH DISCONTINUANCE, INCLUDING THE REASON FOR THE DISCONTINUANCE, AND
AN  OFFICER  OR DIRECTOR OF THE CORPORATION CERTIFIES TO THE SUPERINTEN-
DENT THAT THE CORPORATION HAS COMPLIED WITH ITEMS (I), (II) AND (III) OF
THIS PARAGRAPH. IF SUCH NOTICE DOES NOT INCLUDE THE DATE OR  DATES  THAT
THE  CORPORATION MAILED OR DELIVERED THE NOTICE TO ALL CONTRACT HOLDERS,
COVERED EMPLOYERS AND MEMBER INSUREDS, THE CORPORATION SHALL NOTIFY  THE
SUPERINTENDENT  OF  SUCH DATE WITHIN SEVEN DAYS OF THE COMPLETION OF THE
MAILING OR DELIVERY.
  (B) IF THE SUPERINTENDENT DETERMINES  THAT  THE  CORPORATION  HAS  NOT
COMPLIED WITH ITEM (III) OF SUBPARAGRAPH (A) OF THIS PARAGRAPH, THEN THE
SUPERINTENDENT MAY PROHIBIT THE CORPORATION FROM DISCONTINUING THE CLASS
OF  CONTRACTS  AND  REQUIRE  THE  CORPORATION  TO  PROMPTLY NOTIFY EVERY
CONTRACT HOLDER, COVERED EMPLOYEE AND MEMBER  INSURED  THAT  THE  CORPO-
RATION  IS NOT DISCONTINUING THE CONTRACTS. IF THE SUPERINTENDENT DETER-
MINES  THAT  THE  CORPORATION  WRONGFULLY  DISCONTINUED  THE  CLASS   OF
CONTRACTS  PURSUANT  TO  ITEM (III) OF SUBPARAGRAPH (A), THEN THE SUPER-
INTENDENT SHALL REQUIRE  THAT  THE  CORPORATION  TAKE  REMEDIAL  ACTION,
INCLUDING  OFFERING  TO GROUP CONTRACT HOLDERS THE OPTION OF REINSTATING
THE DISCONTINUED CONTRACT FORMS. IF THE SUPERINTENDENT  DETERMINES  THAT
THE  CORPORATION  DISCONTINUED THE CLASS OF CONTRACTS WITHOUT COMPLIANCE
WITH ITEMS (I), (II), OR (IV) OF  SUBPARAGRAPH  (A),  AND  AN  EMPLOYEE,
MEMBER  INSURED  OR  DEPENDENT  COVERED  UNDER THE DISCONTINUED CONTRACT
WOULD HAVE BEEN ENTITLED TO RELIEF UNDER THIS PARAGRAPH, THEN THE SUPER-
INTENDENT MAY REQUIRE THAT THE CORPORATION OFFER REPLACEMENT COVERAGE TO
AN AFFECTED CONTRACT HOLDER CONSISTENT WITH ITEM  (II)  OF  SUBPARAGRAPH
(C) OF THIS PARAGRAPH.
  (C)  (I)  IF,  WITHIN  FORTY-FIVE  DAYS AFTER THE CORPORATION MAILS OR
DELIVERS THE WRITTEN NOTICE OF DISCONTINUANCE REQUIRED BY  ITEM  (I)  OF
SUBPARAGRAPH  (A) OF THIS PARAGRAPH, THE SUPERINTENDENT IS NOTIFIED BY A
CONTRACT HOLDER OR COVERED EMPLOYEE OR MEMBER  INSURED  THAT  A  COVERED
EMPLOYEE,  MEMBER  INSURED  OR DEPENDENT HAS A SERIOUS MEDICAL CONDITION
AND THAT A BENEFIT UTILIZED BY THE COVERED EMPLOYEE, MEMBER  INSURED  OR
DEPENDENT  WITHIN  THE  PREVIOUS  TWELVE  MONTHS  RELATED TO THE SERIOUS
MEDICAL CONDITION MAY NOT BE COVERED BY THE REPLACEMENT COVERAGE OFFERED
TO THE CONTRACT HOLDER AS A  RESULT  OF  THE  DISCONTINUANCE,  THEN  THE
SUPERINTENDENT  SHALL,  WITHIN  TWENTY DAYS OF THE NOTIFICATION, ASK THE
CORPORATION TO CONFIRM THAT THE  COVERED  EMPLOYEE,  MEMBER  INSURED  OR
DEPENDENT  UTILIZED A BENEFIT WITHIN THE PREVIOUS TWELVE MONTHS TO TREAT
THE MEDICAL CONDITION THAT  THE  COVERED  EMPLOYEE,  MEMBER  INSURED  OR
DEPENDENT  ASSERTS  IS A SERIOUS MEDICAL CONDITION, AND THAT THE BENEFIT
IS NOT COVERED BY  THE  REPLACEMENT  COVERAGE.  THE  SUPERINTENDENT  MAY
REQUEST  SUCH  ADDITIONAL INFORMATION AS THE SUPERINTENDENT MAY REQUIRE.
THE CORPORATION SHALL PROVIDE ALL REQUESTED INFORMATION  TO  THE  SUPER-
INTENDENT WITHIN FIVE DAYS OF RECEIPT OF THE REQUEST.
  (II)  IF,  WITHIN  TWENTY  DAYS OF THE SUPERINTENDENT'S RECEIPT OF ALL
ADDITIONAL INFORMATION REQUESTED FROM THE CORPORATION,  THE  SUPERINTEN-
DENT DETERMINES THAT (I) THE COVERED EMPLOYEE, MEMBER INSURED OR DEPEND-
ENT  HAS  A  SERIOUS MEDICAL CONDITION; AND (II) THE BENEFIT UTILIZED BY
THE COVERED EMPLOYEE, MEMBER INSURED OR DEPENDENT  WITHIN  THE  PREVIOUS
TWELVE MONTHS RELATED TO THE SERIOUS MEDICAL CONDITION IS NOT COVERED BY
THE  REPLACEMENT  COVERAGE OFFERED TO THE CONTRACT HOLDER AS A RESULT OF
THE DISCONTINUANCE, THEN THE SUPERINTENDENT  SHALL  REQUIRE  THE  CORPO-

A. 9243--B                          6

RATION  TO  OFFER  TO  THE  CONTRACT  HOLDER  REPLACEMENT  COVERAGE THAT
INCLUDES A BENEFIT THAT IS THE SAME AS OR SUBSTANTIALLY SIMILAR  TO  THE
BENEFIT  SET FORTH IN THE CONTRACT THAT THE CORPORATION DISCONTINUED. IF
THE REPLACEMENT COVERAGE IS NOT AVAILABLE, AT THE TIME THAT THE CONTRACT
WOULD  OTHERWISE  BE  DISCONTINUED,  THEN THE CORPORATION SHALL KEEP THE
EXISTING POLICY IN FORCE FOR THE  AFFECTED  CONTRACT  HOLDER  UNTIL  THE
REPLACEMENT  COVERAGE  WITH  THE SUBSTANTIALLY SIMILAR BENEFIT IS AVAIL-
ABLE.
  (D) THE REMEDIES AS PROVIDED IN THIS PARAGRAPH SHALL BE IN ADDITION TO
AND NOT IN LIEU OF ANY OTHER AUTHORITY OR POWER OF THE SUPERINTENDENT TO
IMPOSE MONETARY OR OTHER PENALTIES FOR VIOLATIONS OF THIS PARAGRAPH.
  [(B)] (E) In any case in which a  corporation  elects  to  discontinue
offering  all  hospital,  surgical  and  medical expense coverage in the
small group market or the large group market, or both markets,  in  this
state,  health insurance coverage may be discontinued by the corporation
only if:
  (i) the corporation provides written notice to the superintendent  and
to  each  contract  holder  (and  [participants  and  beneficiaries] ALL
EMPLOYEES AND MEMBER INSUREDS  covered  under  such  coverage)  of  such
discontinuance at least one hundred eighty days prior to the date of the
discontinuance of such coverage;
  (ii)  all  hospital,  surgical  and medical expense coverage issued or
delivered for issuance in this  state  in  such  market  or  markets  is
discontinued and coverage under such contracts in such market or markets
is not renewed; and
  (iii)  in  addition to the notice to the superintendent referred to in
item (i) of this subparagraph, the corporation [must] SHALL provide  the
superintendent  with  a written plan to minimize potential disruption in
the marketplace occasioned by [its] THE  CORPORATION'S  withdrawal  from
the market.
  [(C)] (F) In the case of a discontinuance under subparagraph [(B)] (E)
of  this  paragraph in a market, the corporation may not provide for the
issuance of any group or  blanket  contract  of  hospital,  surgical  or
medical  expense insurance in that market in this state during the five-
year period beginning on the date of  the  discontinuance  of  the  last
health insurance contract not so renewed.
  S  4. This act shall take effect on the first of January next succeed-
ing the date on which it shall have become a law.