NY State Senate Bill 2009-S52202

Archive: Last Bill Status - In Senate Committee Rules Committee

Introduced
- In Committee Assembly
- In Committee Senate
- On Floor Calendar Assembly
- On Floor Calendar Senate
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Delivered to Governor
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Date of Action	Assembly Actions - Lowercase Senate Actions - UPPERCASE
Jun 24, 2009	referred to rules

2009-S52202 (ACTIVE) - Details

See other versions of this Bill:: A8400 ,; S5471 ,
Current Committee:: Senate Rules
Law Section:: Insurance Law
Laws Affected:: Amd §§3221, 4304 & 4305, Ins L

2009-S52202 (ACTIVE) - Summary

Extends the period of coverage for COBRA benefits under certain insurance contracts from eighteen to thirty-six months.

2009-S52202 (ACTIVE) - Sponsor Memo

                                 BILL NUMBER:  S52202

 TITLE OF BILL :

An act to amend the insurance law, in relation to extending state
continuation benefits from eighteen months to thirty-six months


 PURPOSE :

This bill would help ensure continued access to group health insurance
by extending the period of continuation coverage under a group
contract or group remittance contract from 18 months.to 36 months.

 SUMMARY OF PROVISIONS :

Section 1 of the bill would amend Insurance Law § 3221 to require
commercial insurers offering group policies to extend the period of
state continuation coverage from 18 months to 36 months for employees
or members. Section 1 of the bill would also allow an employee or
member who has otherwise exhausted federal continuation benefits under
the Consolidated Omnibus Budget Reconciliation Act ("COBRA") to
maintain coverage for up to 36 months, if the employee or member is
entitled to less than 36 months of federal COBRA benefits.

Section 2 of the bill would amend Insurance Law § 4304 to require

not-for-profit corporations and health maintenance organizations
("HMOs") offering group remittance contracts to extend continuation
benefits from 18 months to 36 months, under the same terms and
conditions as commercial insurers.

Section 3 of the bill would amend Insurance Law § 4305 to require
not-for-profit corporations and HMOs offering group contracts to
extend continuation benefits from 18 months to 36 months, under the
same terms and conditions as commercial insurers.

Section 4 of the bill would provide that the bill take effect on July
1, 2009 and apply to all contracts issued, renewed, modified, altered
or amended on or after that date.

 EXISTING LAW :

Insurance Law § 3221 (m) permits individuals covered under commercial
group or blanket accident and health insurance policies that are not
subject to federal COBRA law to elect to participate in state
continuation coverage in the event of job loss, reduction in work
hours or loss of eligibility. Such individuals must elect state
continuation coverage within 60 days of the event which qualifies them
for coverage or within 60 days of receiving notice of the right to
elect such coverage. There is no cost to the employer for continuation
coverage. The former employee or member pays the full premium, which
is capped at 102 percent of the group rate.

The period of continuation coverage for employees or members is
limited to 18 months, at which time the former employee loses their
right to continuation coverage. In cases where dependents lose
coverage due to divorce, separation, or aging off a parent's policy,
the period of continuation coverage is 36 months.  Insurance Law §
4304(k) sets forth provisions similar to those of Insurance Law § 3221
(m), permitting the election of state continuation coverage for group
remittance contracts with a hospital service, health service or
medical expense indemnity corporation.

Insurance Law § 4305(e) sets forth provisions similar to those of
Insurance Law § 3221 (m), permitting the election of state

continuation coverage for group contracts with a hospital service,
health service or medical expense indemnity corporation.

Chapter 18 of the Employee Retirement Income Security Act, 29 D.S.C.
§ 1161, et seq., provides for continuation coverage and additional
standards for group health plans.

Chapter 6A of the Public Health Service Act, 42 D.S.C. § 300bb-1, et
seq., provides for continuation coverage under State and local group
health plans.

The American Recovery and Reinvestment Act of 2009 expanded access to
federal COBRA and state continuation benefits for laid-off workers by
providing a 9-month, 65% subsidy of premiums.

 LEGISLATIVE HISTORY :

This is a new bill.

 STATEMENT OF SUPPORT :

COBRA allows workers to continue their group health insurance coverage
for 18 months if their employment is involuntarily terminated or if
they lose their coverage due to a reduction in work hours. However,
COBRA only applies to employers with 20 or more employees. To address
this gap, the State's "Mini-COBRA" law requires small employers (with
less than 20 employees) to offer an 18-month State health insurance
continuation benefit similar to COBRA.

This bill would allow workers, regardless of the size of their
employer, to extend their health insurance continuation benefit from
18 months to 36 months, at no direct cost to the State or employers.
Currently, those who do not have access to group health insurance
(including those that exhaust their continuation benefits) must
purchase coverage on an individual basis.  New York's individual
health insurance market is standardized, with very comprehensive
benefits and prohibitively high premiums.  Continuation coverage is
available at an average cost of $400 per month for single coverage.
The average cost of individual health insurance coverage currently
exceeds $900 per month (higher in certain regions). While the Healthy
NY program offers a less expensive option, it is not available to
everyone due to eligibility requirements.

Current national unemployment rates are at a 24-year high. New York's
unemployment rate was close to eight percent as of February 2009, up
from six percent in November 2008, and climbing at a rate that exceeds
the national average. An increasing number of workers are experiencing
extended periods of job loss or being forced to work part-time. All of
these factors contribute to a loss of group health insurance coverage.
Also, as companies downsize, older workers are often offered early
retirement options as an alternative to lay-offs.  These individuals
may not have retiree health benefits, and can be years away from
Medicare.

This bill extends a more affordable private health insurance option,
at no direct cost to the State or employers. This bill would allow
individuals to maintain their existing coverage for a longer period of
time through continuation coverage. Without such option, many of these
individuals would be uninsured after 18 months.

 BUDGET IMPLICATIONS :

This bill will have not have a material impact on State finances.

 EFFECTIVE DATE :
The bill would take effect on July 1, 2009 and would apply to all
contracts issued, renewed, modified, amended or altered on or after
that date.

2009-S52202 (ACTIVE) - Bill Text download pdf

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

                                   202

                       Third Extraordinary Session

                            I N  S E N A T E

                              June 24, 2009
                               ___________

Introduced by COMMITTEE ON RULES -- (at request of the Governor) -- read
  twice  and  ordered  printed,  and when printed to be committed to the
  Committee on Rules

AN ACT to amend the  insurance  law,  in  relation  to  extending  state
  continuation benefits from eighteen months to thirty-six months

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

  Section 1. Paragraphs 4 and 6 of subsection (m) of section 3221 of the
insurance law, paragraph 4 as amended by chapter  501  of  the  laws  of
1992,  subparagraph  D  of  paragraph 4 as amended by chapter 661 of the
laws of 1997, paragraph 6 as added by chapter 210 of the laws  of  1987,
are amended to read as follows:
  (4) Subject to paragraph one of this subsection, continuation of bene-
fits  under the group policy for any person shall terminate at the first
to occur of the following:
  (A) The date [eighteen] THIRTY-SIX months after the date  the  employ-
ee's  or  member's benefits under the policy would otherwise have termi-
nated because of termination of employment or membership; or
  (B) The end of the period for which premium payments were made, if the
employee or member fails to make timely payment of  a  required  premium
payment; or
  (C) In the case of an eligible dependent of an employee or member, the
date  thirty-six  months after the date such person's benefits under the
policy would otherwise have terminated by reason of:
  (i) the death of the employee or member;
  (ii) the divorce or legal separation of the employee  or  member  from
his or her spouse;
  (iii) the employee or member becoming entitled to benefits under title
XVIII of the United States Social Security Act (Medicare); or
  (iv)  a  dependent  child  ceasing  to  be a dependent child under the
generally applicable requirements of the policy; or

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD12027-03-9

S. 202                              2

  (D) [In the case of an employee or member  who  is  determined,  under
title  II or title XVI of the Social Security Act, to have been disabled
at the time of termination of employment or membership or  at  any  time
during  the first sixty days of continuation of coverage, the date twen-
ty-nine  months after the date the employee's or member's benefits under
the policy would otherwise have terminated  because  of  termination  of
employment  or  membership;  provided, however, that if such employee or
member is no longer disabled, the benefits provided in this subparagraph
shall terminate the later of (i) the date provided by  subparagraph  (A)
of  this  paragraph,  or (ii) the month that begins more than thirty-one
days after the date of the final determination under title II  or  title
XVI of the United States Social Security Act that the employee or member
is no longer disabled; or
  (E)]  The date on which the group policy is terminated or, in the case
of an employee, the date his employer terminates participation under the
group policy. However, if this clause applies and the  coverage  ceasing
by  reason  of  such  termination  is replaced by similar coverage under
another group policy, the following shall apply:
  (i) The employee or member shall have  the  right  to  become  covered
under  that  other  group  policy, for the balance of the period that he
would have remained covered under the prior group policy  in  accordance
with  this subparagraph had a termination described in this subparagraph
not occurred, and
  (ii) The minimum level of benefits to be provided by the  other  group
policy  shall  be  the  applicable  level of benefits of the prior group
policy reduced by any benefits payable under that  prior  group  policy,
and
  (iii) The prior group policy shall continue to provide benefits to the
extent  of  its  accrued liabilities and extension of benefits as if the
replacement had not occurred.
  (6) This subsection shall not be applicable where a continuation bene-
fit is available to the employee or member pursuant to Chapter 18 of the
Employee Retirement Income Security Act, 29 U.S.C.  S  1161  et  seq  or
Chapter  6A  of the Public Health Service Act, 42 U.S.C. S 300 bb - 1 et
seq. HOWEVER, A GROUP POLICY SHALL OFFER AN INSURED  WHO  HAS  EXHAUSTED
CONTINUATION  COVERAGE PURSUANT TO CHAPTER 18 OF THE EMPLOYEE RETIREMENT
INCOME SECURITY ACT, 29 U.S.C. S 1161 ET  SEQ.  OR  CHAPTER  6A  OF  THE
PUBLIC  HEALTH  SERVICE ACT, 42 U.S.C. S 300 BB - 1 ET SEQ. THE OPPORTU-
NITY TO CONTINUE COVERAGE FOR UP TO THIRTY-SIX MONTHS FROM THE DATE  THE
EMPLOYEE'S  OR  MEMBER'S CONTINUATION COVERAGE BEGAN, IF THE EMPLOYEE OR
MEMBER IS ENTITLED TO LESS THAN THIRTY-SIX MONTHS OF CONTINUATION  BENE-
FITS UNDER FEDERAL LAW.
  S  2.  Paragraph  4 of subsection (k) of section 4304 of the insurance
law, as added by chapter 501 of the laws  of  1992,  subparagraph  D  as
amended  by  chapter 661 of the laws of 1997, is amended and a new para-
graph 5 is added to read as follows:
  (4) Subject to paragraph one of this subsection, continuation of bene-
fits under the group remittance contract for any person shall  terminate
at the first to occur of the following:
  (A)  The  date [eighteen] THIRTY-SIX months after the date the employ-
ee's or member's benefits under the contract would otherwise have termi-
nated because of termination of employment or membership; or
  (B) The end of the period for which premium payments were made, if the
employee or member fails to make timely payment of  a  required  premium
payment; or

S. 202                              3

  (C) In the case of an eligible dependent of an employee or member, the
date  thirty-six  months after the date such person's benefits under the
contract would otherwise have terminated by reason of:
  (i) the death of the employee or member;
  (ii)  the  divorce  or legal separation of the employee or member from
his or her spouse;
  (iii) the employee or member becoming entitled to benefits under title
XVIII of the United States Social Security Act (Medicare); or
  (iv) a dependent child ceasing to  be  a  dependent  child  under  the
generally applicable requirements of the contract; or
  (D)  [In  the  case  of an employee or member who is determined, under
title II or title XVI of the Social Security Act, to have been  disabled
at  the  time  of  the termination of employment or membership or at any
time during the first sixty days of continuation of coverage,  the  date
twenty-nine  months  after  the date the employee's or member's benefits
under the contract would otherwise have  terminated  because  of  termi-
nation  of  employment  or  membership;  provided, however, that if such
employee or member is no longer disabled, the benefits provided in  this
subparagraph  shall  terminate  the  later  of  (i) the date provided by
subparagraph (A) of this paragraph, or (ii) the month that  begins  more
than  thirty-one  days  after  the date of the final determination under
title II or title XVI of the United States Social Security Act that  the
employee or member is no longer disabled; or
  (E)]  The date on which the group remittance contract with that remit-
ting agent is terminated or, in the case of an employee,  the  date  his
employer  terminates  participation under the group remittance contract.
However, if this clause applies and the coverage ceasing  by  reason  of
such  termination is replaced by similar coverage under another group or
group remittance contract, the following shall apply:
  (i) The employee or member shall have  the  right  to  become  covered
under  that other group or group remittance contract, for the balance of
the period that he would have remained covered  under  the  prior  group
remittance  contract  in  accordance with this subparagraph had a termi-
nation described in this subparagraph not occurred, and
  (ii) The minimum level of benefits to be provided by the  other  group
or  group  remittance contract shall be the applicable level of benefits
of the prior group remittance contract reduced by any  benefits  payable
under that prior group remittance contract, and
  (iii)  The  prior  group remittance contract shall continue to provide
benefits to the extent of its accrued liabilities and extension of bene-
fits as if the replacement had not occurred.
  (5) A CONTRACT FOR WHICH PREMIUMS ARE PAID BY A REMITTING AGENT FOR  A
GROUP  ISSUED  BY  A HOSPITAL SERVICE, HEALTH SERVICE OR MEDICAL EXPENSE
INDEMNITY  CORPORATION  SHALL  OFFER  AN  EMPLOYEE  OR  MEMBER  WHO  HAS
EXHAUSTED  CONTINUATION  COVERAGE PURSUANT TO CHAPTER 18 OF THE EMPLOYEE
RETIREMENT INCOME SECURITY ACT, 29 U.S.C. S 1161 ET SEQ.  OR CHAPTER  6A
OF  THE  PUBLIC  HEALTH  SERVICE ACT, 42 U.S.C. S 300 BB - 1 ET SEQ. THE
OPPORTUNITY TO CONTINUE COVERAGE FOR UP TO THIRTY-SIX  MONTHS  FROM  THE
DATE  THE  EMPLOYEE'S  OR  MEMBER'S  CONTINUATION  COVERAGE BEGAN IF THE
EMPLOYEE OR MEMBER IS ENTITLED TO LESS THAN THIRTY-SIX MONTHS OF CONTIN-
UATION BENEFITS.
  S 3. Paragraphs 4 and 7 of subsection  (e)  of  section  4305  of  the
insurance  law,  paragraph  4  as  amended by chapter 677 of the laws of
1993, subparagraph D of paragraph 4 as amended by  chapter  661  of  the
laws  of  1997, paragraph 7 as added by chapter 210 of the laws of 1987,
are amended to read as follows:

S. 202                              4

  (4) Subject to paragraph one of this subsection, continuation of bene-
fits under the group contract for any  person  shall  terminate  at  the
first to occur of the following:
  (A)  The  date [eighteen] THIRTY-SIX months after the date the employ-
ee's or member's benefits under the contract would otherwise have termi-
nated because of termination of employment or membership; or
  (B) The end of the period for which premium payments were made, if the
employee or member fails to make timely payment of  a  required  premium
payment; or
  (C) In the case of an eligible dependent of an employee or member, the
date  thirty-six  months after the date such person's benefits under the
contract would otherwise have terminated by reason of:
  (i) the death of the employee or member;
  (ii) the divorce or legal separation of the employee  or  member  from
his or her spouse;
  (iii) the employee or member becoming entitled to benefits under title
XVIII of the United States Social Security Act (Medicare); or
  (iv)  a  dependent  child  ceasing  to  be a dependent child under the
generally applicable requirements of the contract; or
  (D) [In the case of an employee or member  who  is  determined,  under
title  II or title XVI of the Social Security Act, to have been disabled
at the time of termination of employment or membership or  at  any  time
during  the first sixty days of continuation of coverage, the date twen-
ty-nine months after the date the employee's or member's benefits  under
the  contract  would otherwise have terminated because of termination of
employment or membership; provided, however, that if  such  employee  or
member is no longer disabled, the benefits provided in this subparagraph
shall  terminate  the later of (i) the date provided by subparagraph (A)
of this paragraph, or (ii) the month that begins  more  than  thirty-one
days  after  the date of the final determination under title II or title
XVI of the United States Social Security Act that the employee or member
is no longer disabled; or
  (E)] The date on which the group contract is  terminated  or,  in  the
case  of  an  employee,  the  date his employer terminated participation
under the group contract. However, if this clause applies and the cover-
age ceasing by reason of such termination is replaced by similar  cover-
age under another group contract, the following shall apply:
  (i)  The  employee  or  member  shall have the right to become covered
under that other group contract, for the balance of the period  that  he
would have remained covered under the prior group contract in accordance
with  this subparagraph had a termination described in this subparagraph
not occurred, and
  (ii) The minimum level of benefits to be provided by the  other  group
contract  shall  be  the applicable level of benefits of the prior group
contract reduced by any benefits payable under the prior group contract,
and
  (iii) The prior group contract shall continue to provide  benefits  to
the  extent  of its accrued liabilities and extensions of benefits as if
the replacement had not occurred.
  (7) This subsection shall not be applicable where a continuation bene-
fit is available to the employee or member pursuant to Chapter 18 of the
Employee Retirement Income Security Act, 29 U.S.C.  S  1161  et  seq  or
Chapter  6A  of the Public Health Service Act, 42 U.S.C. S 300 bb - 1 et
seq.  HOWEVER, A GROUP CONTRACT SHALL OFFER AN EMPLOYEE  OR  MEMBER  WHO
HAS  EXHAUSTED  CONTINUATION  COVERAGE  PURSUANT  TO  CHAPTER  18 OF THE
EMPLOYEE RETIREMENT INCOME SECURITY ACT, 29 U.S.C. S  1161  ET  SEQ.  OR

S. 202                              5

CHAPTER  6A  OF THE PUBLIC HEALTH SERVICE ACT, 42 U.S.C. S 300 BB - 1 ET
SEQ. THE OPPORTUNITY TO CONTINUE COVERAGE FOR UP  TO  THIRTY-SIX  MONTHS
FROM  THE DATE THE EMPLOYEE'S OR MEMBER'S CONTINUATION COVERAGE BEGAN IF
THE  EMPLOYEE  OR  MEMBER  IS ENTITLED TO LESS THAN THIRTY-SIX MONTHS OF
CONTINUATION BENEFITS.
  S 4. This act shall take effect on July 1, 2009  and  shall  apply  to
policies  and contracts issued, renewed, modified, altered or amended on
or after such date.

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Senate Bill S52202

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Archive: Last Bill Status - In Senate Committee Rules Committee

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2009-S52202 (ACTIVE) - Details

2009-S52202 (ACTIVE) - Summary

2009-S52202 (ACTIVE) - Sponsor Memo

2009-S52202 (ACTIVE) - Bill Text download pdf

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Sponsored By

Archive: Last Bill Status - In Senate Committee Rules Committee

Actions

2009-S52202 (ACTIVE) - Details

2009-S52202 (ACTIVE) - Summary

2009-S52202 (ACTIVE) - Sponsor Memo

2009-S52202 (ACTIVE) - Bill Text download pdf

Comments