S T A T E   O F   N E W   Y O R K
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                                  3901

                       2009-2010 Regular Sessions

                          I N  A S S E M B L Y

                            January 28, 2009
                               ___________

Introduced by M. of A. WALKER, ALFANO, McKEVITT -- Multi-Sponsored by --
  M.  of A. BARRA, BURLING -- read once and referred to the Committee on
  Insurance

AN ACT to amend the insurance law, in relation  to  requiring  insurance
  carriers to provide persons under a group health insurance policy with
  thirty days notice of the termination of such policy

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

  Section 1. Subsection (a) of section 3221  of  the  insurance  law  is
amended by adding a new paragraph 16 to read as follows:
  (16)  (A)  THAT  THE  INSURER  UPON  TERMINATION  OF A GROUP POLICY OR
CONTRACT OF HEALTH, OR ACCIDENT AND HEALTH INSURANCE ISSUED TO A POLICY-
HOLDER, COVERING INDIVIDUALS WHO BECAUSE OF THEIR EMPLOYEE OR MEMBERSHIP
STATUS ARE CERTIFICATE HOLDERS UNDER A GROUP POLICY, SHALL PROVIDE  EACH
CERTIFICATE  HOLDER  WITH WRITTEN NOTICE OF SUCH TERMINATION OF COVERAGE
THIRTY DAYS PRIOR TO SUCH TERMINATION, AND  NO  SUCH  TERMINATION  SHALL
BECOME EFFECTIVE UNTIL THIRTY DAYS AFTER SUCH NOTICE OF TERMINATION.
  (B)  IN  ITS  NOTICE OF TERMINATION OF COVERAGE, THE INSURER SHALL SET
FORTH, IN FULL, THE RIGHTS OF THE CERTIFICATE HOLDER UNDER THE TERMINAT-
ING POLICY AS TO COVERAGE FOR ILLNESS, ACCIDENT AND TREATMENT  OCCURRING
PRIOR  TO  AND SUBSEQUENT TO THE TERMINATION DATE, AND SUCH OTHER RIGHTS
OF CERTIFICATE HOLDERS AS MAY EXIST UNDER  THE  CONTRACT  OR  POLICY  OR
PURSUANT TO PARAGRAPH ONE OF SUBSECTION (E) OF THIS SECTION.
  (C)  NOTICE  OF TERMINATION OF COVERAGE SHALL BE MAILED BY THE INSURER
TO EACH CERTIFICATE HOLDER'S LAST KNOWN RESIDENTIAL ADDRESS.
  S 2. Paragraph 1 of subsection (e) of section 3221  of  the  insurance
law,  as  amended by chapter 306 of the laws of 1987, is amended to read
as follows:
  (1) A group policy providing hospital or  surgical  expense  insurance
for other than specific diseases or accident only, shall provide that if
the  insurance  on  an employee or member insured under the group policy

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD01536-01-9
              

A. 3901                             2

ceases because of termination of (I) employment or of membership in  the
class  or  classes  eligible  for  coverage under the policy or (II) the
policy, for any reason whatsoever, unless the policyholder has  replaced
the group policy with similar and continuous coverage for the same group
whether  insured  or  self-insured, such employee or member who has been
insured under the group policy for at least three months shall be  enti-
tled to have issued to him by the insurer without evidence of insurabil-
ity  upon  application  made to the insurer within forty-five days after
such termination OF EMPLOYMENT OR MEMBERSHIP IN  THE  CLASS  OR  CLASSES
ELIGIBLE  FOR  COVERAGE  UNDER  THE  POLICY OR WITHIN FORTY-FIVE DAYS OF
NOTIFICATION BY THE INSURANCE CARRIER  TO  THE  EMPLOYEE  OR  MEMBER  OF
TERMINATION  OF  THE  POLICY,  and  payment of the quarterly, or, at the
option of the employee or member, a less frequent premium applicable  to
the  class  of risk to which the person belongs, the age of such person,
and the form and amount of insurance, an individual policy of insurance.
The insurer may, at its option elect to provide the  insurance  coverage
under  a group insurance policy, delivered in this state, in lieu of the
issuance of a converted individual policy of insurance. Such  individual
policy,  or group policy, as the case may be is hereafter referred to as
the converted policy.  The benefits provided under the converted  policy
shall  be  those required by subsection (f), (g), (h) or (i) [hereof] OF
THIS SECTION, whichever is applicable and, in the event  of  termination
of  the  converted  group  policy  of insurance, each insured thereunder
shall have a right of conversion to a  converted  individual  policy  of
insurance.
  S 3. This act shall take effect immediately.