NY State Assembly Bill 2009-A10472

Archive: Last Bill Status - In Assembly Committee

Introduced
- In Committee Assembly
- In Committee Senate
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Date of Action	Assembly Actions - Lowercase Senate Actions - UPPERCASE
Mar 29, 2010	referred to small business

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2009-A10472 (ACTIVE) - Details

See Senate Version of this Bill:: S1639
Current Committee:: Assembly Small Business
Law Section:: Insurance Law
Laws Affected:: Add Art 43-A §§4351 - 4353, Ins L; add §97-jjjj, St Fin L

2009-A10472 (ACTIVE) - Summary

Establishes the small business insurance board (SBIB) and small business insurance pool program to provide state-negotiated health insurance to qualified small businesses.

2009-A10472 (ACTIVE) - Sponsor Memo

                                BILL NUMBER:A10472

TITLE  OF BILL:  An act to amend the insurance law and the state finance
law, in relation to establishing the small business insurance pool

PURPOSE OR GENERAL IDEA OF BILL: Allows the  creation  of  a  new  Small
Business  Insurance  Pool  to be available to businesses with one to 100
employees. A Small Business Insurance Board (SBIB) will be appointed  to
govern this new insurance program.

SUMMARY  OF  SPECIFIC  PROVISIONS: Section 1 amends Sections 4315, 4352,
and 4353 of the Insurance Law to authorize the establishment of a  Small
Business Insurance Board (SBIB). The SBIB would consist of five members,
one  appointment  by  the  Governor,and  one appointment by Majority and
Minority party of each house. The SBIB will be tasked  with  hiring  the
appropriate  staff  necessary  to carry out the functions of negotiating
with insurance companies. In particular, the Board will hire an Adminis-
trator who will oversee and lead  in  all  negotiations  with  insurance
companies:  The SBIS will be able to enter into contracts with insurance
carriers to provide health insurance benefits to eligible employees. The
Section also defines eligible small businesses as those with between one
and 100 employees.

Section 2 adds Section 97-iiii to the State Finance Law to  establish  a
Small  Business  Insurance  Pool  Fund.  The Fund will consist of monies
received from surcharges paid by participating small businesses.   These

funds will be specifically used to cover the administrative costs of the
Small  Businesses Insurance Pool Program and will not be commingled with
any other funds.

Section 3 establishes the effective date of January 1, 2009.

EFFECTS OF PRESENT LAW WHICH THIS BILL WOULD  ALTER:    Amends  Sections
4315,  4352,  and  4353 of the Insurance Law and adds Section 97-iiii to
the State Finance Law.

JUSTIFICATION: Purchasing alliances continue to be at the  forefront  of
health  policy. President Clinton's 1998-99 budget included $100 million
over five years to aid states in developing alliances  for  firms,  with
one  to  50  employees.  The  Patients'  Bill of Rights Plus Act of 1999
called for the creation of "Health Marts" to  provide  multiple  options
from  which  employees  of  small firms could choose. One of the largest
problems small businesses face is their inability to  bargain  for  less
expensive insurance for their employees. With the rising costs of health
insurance,  small  business employees are particularly hurt by increases
in health insurance premiums - 5% of all small firms surveyed in a  2004
national  study  by  the Kaiser Family Foundation said they were very or
somewhat likely to drop health insurance coverage over the next year. In
2001, over 95% of the firms in New York State employed  fewer  than  100
employees, comprising 37% of the State work force. Due to their inabili-
ty  to  pool large groups of employees in order to lower premiums, it is
in general more expensive for small business employers to offer the same

health insurance coverage as their  larger  counterparts.  Not  only  do
employees  in  small businesses pay more in premiums, but they also paid
69% more in premiums in 2004 than they did in 2000, while those in busi-
nesses with 100 or greater employees saw their premiums increase by 31%.

This  blistering  increase can be attributed both to the overall rate of
health insurance inflation and, perhaps more importantly,  to  employers
in small businesses passing an increasing proportion of health insurance
premiums  onto  their  employees. It is important to note that, although
their offered plans are more expensive, employers (not  costs)  are  the
primary  limiting factor in whether or not small business employees have
coverage: only 49% of firms with fewer than 100 employees offered access
to employer-sponsored health coverage, compared with 72% of those  firms
with  100  or  more  workers.  Overall, we can see that all the evidence
supports the claim that employees working in  small  businesses  have  a
harder  time  getting  and keeping their health insurance coverage. This
bill attempts to rectify this  problem  by  creating  a  small  business
insurance  pool,  negotiated  and  administered  by the State. The State
would negotiate HMO and other types of plans and make them available for
all small businesses and their employees, regardless of income.

PRIOR LEGISLATIVE HISTORY: A.9036 of 2006. A2364a of 2007-2008 -Referred
to Small Business

FISCAL IMPLICATIONS: Approximately $1 million for initial startup costs-
to support personal and nonpersonal services.

EFFECTIVE DATE: Immediately

2009-A10472 (ACTIVE) - Bill Text download pdf

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

                                  10472

                          I N  A S S E M B L Y

                             March 29, 2010
                               ___________

Introduced by M. of A. ESPAILLAT, PHEFFER, CASTRO, MILLMAN, SCHIMMINGER,
  KOON, COLTON, SCARBOROUGH, D. WEPRIN, SALADINO, BOYLAND, GIBSON, McDO-
  NOUGH  --  Multi-Sponsored  by  --  M.  of  A. ABBATE, BARRON, CORWIN,
  DelMONTE,  GABRYSZAK,  MAGEE,  MARKEY,  MAYERSOHN,  M. MILLER,  QUINN,
  ROBINSON, TOWNSEND -- read once and referred to the Committee on Small
  Business

AN ACT to amend the insurance law and the state finance law, in relation
  to establishing the small business insurance pool

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

  Section 1. The insurance law is amended by adding a new  article  43-A
to read as follows:
                               ARTICLE 43-A
                  SMALL BUSINESS INSURANCE POOL PROGRAM
SECTION 4351. DEFINITIONS.
        4352. SMALL BUSINESS INSURANCE BOARD.
        4353. SMALL BUSINESS INSURANCE POOL PROGRAM.
  S 4351. DEFINITIONS. AS USED IN THIS ARTICLE:
  (A)  "SMALL BUSINESS INSURANCE BOARD" OR "SBIB" MEANS THE BOARD ESTAB-
LISHED PURSUANT TO SECTION FOUR THOUSAND THREE HUNDRED FIFTY-TWO OF THIS
ARTICLE TO ESTABLISH AND MAINTAIN  THE  SMALL  BUSINESS  INSURANCE  POOL
PROGRAM.
  (B)  "SMALL  BUSINESS INSURANCE POOL PROGRAM" MEANS THE PROGRAM ESTAB-
LISHED PURSUANT TO SECTION FOUR THOUSAND THREE HUNDRED FIFTY-THREE UNDER
THE DIRECTION OF THE SBIB.
  (C) "QUALIFIED BUSINESS" MEANS ANY PERSON,  PROPRIETARY  OR  NONPROFIT
FIRM, CORPORATION OR PARTNERSHIP THAT IS ACTIVELY ENGAGED IN BUSINESS IN
THE STATE AND EMPLOYS AT LEAST ONE BUT NO MORE THAN ONE HUNDRED ELIGIBLE
EMPLOYEES,  AS  DEFINED  IN  THIS SECTION, AT LEAST FIFTY PERCENT OF THE
TIME SUCH BUSINESS IS IN OPERATION. ANY BUSINESS THAT  ELECTS  TO  LEAVE
THE SMALL BUSINESS INSURANCE POOL PROGRAM SHALL BE PRECLUDED FROM RE-EN-
TERING THE PROGRAM WITHIN TWELVE MONTHS THEREAFTER.
  (D)  "ELIGIBLE  EMPLOYEE"  MEANS  AN EMPLOYEE WHO IS EMPLOYED AT LEAST
FIFTY PERCENT OF THE TIME AND IS EMPLOYED WITHIN THE STATE.  ELIGIBILITY

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

                                                           LBD04640-02-9

A. 10472                            2

SHALL  ALSO  EXTEND TO THE DEPENDENTS, SPOUSE OR DOMESTIC PARTNER OF THE
ELIGIBLE EMPLOYEE.
  S  4352.  SMALL  BUSINESS  INSURANCE BOARD. (A) THERE IS HEREBY ESTAB-
LISHED WITHIN THE DEPARTMENT THE SMALL BUSINESS INSURANCE BOARD  (SBIB).
THE  BOARD  SHALL  CONSIST OF FIVE MEMBERS: ONE EACH TO BE CHOSEN BY THE
GOVERNOR, THE TEMPORARY PRESIDENT OF THE  SENATE,  THE  SPEAKER  OF  THE
ASSEMBLY,  THE  MINORITY LEADER OF THE SENATE AND THE MINORITY LEADER OF
THE ASSEMBLY PROVIDED THAT NO MEMBER OF THE BOARD SHALL BE AN  EMPLOYEE,
CONSULTANT  OR A MEMBER OF THE BOARD OF DIRECTORS OF ANY INSURER, HOSPI-
TAL SERVICE PLAN OR HEALTH CARE SERVICE PLAN, OR AN INSURANCE BROKER  OR
AGENT DOING BUSINESS IN THE STATE.
  (B) THE BOARD SHALL HAVE THE FOLLOWING RESPONSIBILITIES:
  (1) APPOINT AN ADMINISTRATOR WHO SHALL HIRE APPROPRIATE STAFF AS NEED-
ED.
  (2)  ENTER  INTO  CONTRACTS  WITH  CARRIERS TO PROVIDE HEALTH BENEFITS
COVERAGE TO ELIGIBLE EMPLOYEES AND THEIR DEPENDENTS.
  (3) DEFINE THE  HEALTH  BENEFITS  COVERAGE,  WHICH  THE  PROGRAM  WILL
CONTRACT  TO PURCHASE FROM PARTICIPATING CARRIERS, AND APPROVE THE PLANS
SOLD BY PARTICIPATING CARRIERS.
  (4) UNDERTAKE ACTIVITIES NECESSARY TO ADMINISTER  THE  SMALL  BUSINESS
INSURANCE POOL PROGRAM, INCLUDING MARKETING AND PUBLICIZING THE PROGRAM,
AND  ASSURING  CARRIER,  EMPLOYER,  AND ENROLLEE COMPLIANCE WITH PROGRAM
REQUIREMENTS.
  (5) ESTABLISH RULES, CONDITIONS, AND  PROCEDURES  FOR  SMALL  BUSINESS
EMPLOYERS AND PARTICIPATING CARRIERS.
  (6) ESTABLISH A FINANCIAL RELATIONSHIP DIRECTLY WITH AGENTS OR BROKERS
TO PROVIDE SERVICES UNDER THE SMALL BUSINESS INSURANCE POOL.
  (7) ESTABLISH A MECHANISM TO COLLECT PREMIUMS FROM SMALL EMPLOYERS AND
PAY PARTICIPATING CARRIERS.
  S  4353. SMALL BUSINESS INSURANCE POOL PROGRAM. (A) THE SMALL BUSINESS
INSURANCE BOARD  SHALL  ESTABLISH  THE  SMALL  BUSINESS  INSURANCE  POOL
PROGRAM  TO  BE  OPEN TO QUALIFIED BUSINESSES AS DEFINED IN SECTION FOUR
THOUSAND THREE HUNDRED FIFTY-ONE OF THIS ARTICLE.
  (B) WITHIN THE FIRST FIVE YEARS AFTER ESTABLISHING  THE  PROGRAM,  THE
SBIB  SHALL ENTER INTO CONTRACTS WITH CARRIERS, ACCEPT APPLICATIONS FROM
SMALL BUSINESSES AND GRANT  OR  DECLINE  PARTICIPATION  IN  THE  PROGRAM
PURSUANT TO REGULATIONS ESTABLISHED BY THE SBIB.
  (C)  UPON  ESTABLISHMENT  OF THE INITIAL POOL OF SMALL BUSINESSES, THE
SBIB SHALL CONTRACT WITH ELIGIBLE HEALTH INSURANCE CARRIERS FOR A SET OF
BENEFITS. SUCH SET OF BENEFITS SHALL INCLUDE,  BUT  NOT  NECESSARILY  BE
LIMITED  TO,  HOSPITAL AND PHYSICIAN VISITS, PRESCRIPTION DRUG BENEFITS,
MENTAL HEALTH SERVICES, AND DURABLE MEDICAL EQUIPMENT.
  (D) UPON CONTRACTUAL AGREEMENT BETWEEN  THE  STATE  AND  PARTICIPATING
CARRIERS  AND  HEALTH  CARE  PROVIDERS,  NOTIFICATION  SHALL  BE SENT TO
PARTICIPATING SMALL  BUSINESSES  AND  THEIR  EMPLOYEES  REGARDING  PLANS
AVAILABLE.
  (E)  PREMIUMS PAID BY PARTICIPATING SMALL BUSINESSES AND THEIR EMPLOY-
EES SHALL BE PAID DIRECTLY TO PARTICIPATING CARRIERS.
  (F) THE PREMIUMS PAID BY  PARTICIPATING  SMALL  BUSINESSES  AND  THEIR
EMPLOYEES SHALL ALSO INCLUDE A SURCHARGE SUFFICIENT TO COVER THE COST OF
THE  PROGRAM  BUT  NOT  TO  EXCEED  ONE  PERCENT  OF SUCH PREMIUMS. SUCH
SURCHARGES SHALL BE DEPOSITED IN THE SMALL BUSINESS INSURANCE POOL  FUND
ESTABLISHED  PURSUANT  TO SECTION NINETY-SEVEN-JJJJ OF THE STATE FINANCE
LAW.
  (G) THE SBIB SHALL HAVE THE AUTHORITY TO ADJUST PAYMENTS TO A  CARRIER
SHOULD THE SBIB FIND THAT A CARRIER HAS A SIGNIFICANTLY DISPROPORTIONATE

A. 10472                            3

SHARE  OF  HIGH-  OR LOW-RISK ENROLLEES. PRIOR TO MAKING SUCH A FINDING,
THE SBIB IS REQUIRED TO OBTAIN VALID DATA  FROM  PARTICIPATING  CARRIERS
AND  REPORTING  REQUIREMENTS  SHALL  BE MADE ADMINISTRATIVELY COMPATIBLE
WITH  THE  METHODS  OF  OPERATION  OF  THE  CARRIER.  ANY ADJUSTMENTS TO
PAYMENTS SHALL BE PROSPECTIVE AND SHALL UTILIZE  DEMOGRAPHIC  AND  OTHER
FACTORS ACTUARIALLY RELATED TO RISK.
  (H)  BENEFITS PROVIDED UNDER THE SMALL BUSINESS INSURANCE POOL PROGRAM
SHALL BE EQUAL TO OR GREATER THAN THE BENEFITS PROVIDED, AND CO-PAYMENTS
SHALL BE EQUAL TO OR LESS THAN THE CO-PAYMENTS, UNDER  THE  HEALTHY  NEW
YORK  PROGRAM ESTABLISHED IN SECTION FOUR THOUSAND THREE HUNDRED TWENTY-
SIX AND FOUR THOUSAND THREE HUNDRED TWENTY-SEVEN OF THIS CHAPTER.
  S 2. The state finance law is amended by adding a new section  97-jjjj
to read as follows:
  S  97-JJJJ.  SMALL  BUSINESS  INSURANCE  POOL FUND. 1. THERE IS HEREBY
ESTABLISHED IN THE JOINT CUSTODY OF THE STATE COMPTROLLER AND THE SUPER-
INTENDENT OF THE DEPARTMENT OF INSURANCE A FUND TO BE KNOWN AS THE SMALL
BUSINESS INSURANCE POOL FUND.
  2. THE FUND SHALL CONSIST OF THOSE MONEYS RECEIVED FROM THE SURCHARGES
PAID BY PARTICIPATING SMALL BUSINESSES IN THE SMALL  BUSINESS  INSURANCE
POOL  PROGRAM  PURSUANT TO SUBSECTION (F) OF SECTION FOUR THOUSAND THREE
HUNDRED FIFTY-THREE OF THE INSURANCE LAW.
  3. MONEYS IN THE SMALL BUSINESS  INSURANCE  POOL  FUND  SHALL  NOT  BE
COMMINGLED  WITH MONEYS IN ANY OTHER FUND UNDER THE CUSTODY OF THE STATE
COMPTROLLER.
  4. MONEYS OF THE FUND SHALL BE EXPENDED TO  COVER  THE  ADMINISTRATIVE
COSTS  OF  THE SMALL BUSINESS INSURANCE POOL PROGRAM. THE SUPERINTENDENT
OF INSURANCE SHALL CERTIFY TO THE STATE  COMPTROLLER  THE  AMOUNTS  FROM
SUCH  FUND  WHICH ARE TO BE PAID TO SUCH CARRIERS AND ANY APPROPRIATIONS
PROVIDED THEREFOR. ANY CARRY-OVER BALANCE IN THE FUND SHALL BE  REAPPRO-
PRIATED EACH YEAR BY AN ACT OF THE LEGISLATURE.
  5.  MONEYS SHALL BE PAID OUT OF THE FUND UPON AUDIT AND WARRANT OF THE
STATE COMPTROLLER ON VOUCHERS CERTIFIED AND APPROVED BY THE  SUPERINTEN-
DENT OF INSURANCE.
  S  3.  This  act shall take effect January 1, 2010; provided, however,
that effective immediately, the addition, amendment and/or repeal of any
rule or regulation necessary for the implementation of this act  on  its
effective  date  are authorized and directed to be made and completed on
or before such effective date.

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Assembly Bill A10472

Sponsored By

Archive: Last Bill Status - In Assembly Committee

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multi-Sponsors

2009-A10472 (ACTIVE) - Details

2009-A10472 (ACTIVE) - Summary

2009-A10472 (ACTIVE) - Sponsor Memo

2009-A10472 (ACTIVE) - Bill Text download pdf

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Sponsored By

ESPAILLAT

Archive: Last Bill Status - In Assembly Committee

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co-Sponsors

Audrey Pheffer

Nelson Castro

Joan Millman

Robin Schimminger

multi-Sponsors

Peter Abbate

George Amedore

William A. Barclay

Inez Barron

2009-A10472 (ACTIVE) - Details

2009-A10472 (ACTIVE) - Summary

2009-A10472 (ACTIVE) - Sponsor Memo

2009-A10472 (ACTIVE) - Bill Text download pdf

Comments