NY State Senate Bill 2009-S8274

Archive: Last Bill Status - In Senate Committee Rules Committee

Introduced
- In Committee Assembly
- In Committee Senate
- On Floor Calendar Assembly
- On Floor Calendar Senate
- Passed Assembly
- Passed Senate
Delivered to Governor
Signed By Governor

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	Assembly Actions - Lowercase Senate Actions - UPPERCASE
Jun 18, 2010	referred to rules

2009-S8274 (ACTIVE) - Details

See Assembly Version of this Bill:: A11542
Current Committee:: Senate Rules
Law Section:: Insurance Law
Laws Affected:: Add §§2352 & 9112, Ins L; add §89-h, St Fin L
Versions Introduced in 2011-2012 Legislative Session:: A4669

2009-S8274 (ACTIVE) - Summary

Establishes a physicians and surgeons data collection and advisory association to compile physicians and surgeons medical malpractice exposure, loss and expense statistics related to medical malpractice insurance; advisory association will have a governing body that will charge insurers for services; establishes a medical malpractice insurance fund.

2009-S8274 (ACTIVE) - Sponsor Memo

                                BILL NUMBER:S8274

TITLE OF BILL:

An act
to amend the insurance law, in relation to establishing a medical
malpractice insurance rate recommendation association; and
to amend the state finance law, in relation
to creating the medical malpractice insurance fund

PURPOSE:

This bill establishes: (1) a rate service organization ("RSO") in
order to enhance objectivity and bring transparency and competition
to the physicians and surgeons medical malpractice rate setting
process; and (2) a mechanism to eliminate a significant deficit in
the residual medical malpractice market.

SUMMARY OF PROVISIONS:

Section 1 of the bill would add a new Insurance Law § 2352 to
establish an RSO for physicians and surgeons medical malpractice
insurance.

Subsection (a) would provide definitions.

Subsection (b) would require to be a member of the RSO: (1) all
insurers authorized to write personal injury liability insurance and
engaged in writing, within New York, on a direct basis, insurance
policies providing physicians and surgeons medical malpractice
insurance; and (2) the Medical Malpractice Insurance Plan ("MMIP"),
or its successor.

Subsection (c) would require the RSO to compile data related to
physicians and surgeons medical malpractice insurance, and to provide
to the Superintendent rates or rate information.
The RSO would be exempt from: (1) licensing requirements under
Insurance Law § 2313; (2) reporting requirements under Insurance Law
§ 2315; and (3) the prohibition against mandatory membership in an
RSO under Insurance Law § 2316(a)(9).

Subsection (d) would require the governing body of the RSO to submit
to the Superintendent a proposed plan of operation within 60 days
following the effective date of Insurance Law § 2352.

Subsection (e) would require the governing body of the RSO to be
comprised of voting members consisting of: 1) three members
representing insurers; 2) one member representing the
MMIP; and 3) three members appointed by the Superintendent and
representing the interests of injured parties, physicians and
surgeons, and hospitals. The governing body would have an actuarial

committee, which would review methodology and data collection
processes used to develop rates and other information. The members
representing the interests of injured parties, physicians and
surgeons, and hospitals must together appoint one independent
casualty actuary to serve on that actuarial committee.

Subsection (f) would require each member to submit a statistical
report, as well as any other information that the Superintendent may
deem necessary or expedient in order to establish rates for
physicians and surgeons medical malpractice insurance.

Section 2 of the bill would add a new Insurance Law § 9112 to assess
insurers writing liability insurance in New York.

Subsection (a) would provide definitions.

Subsection (b) would require the MMIP to submit to the Superintendent
no later than August 31, 2010 a plan to operate a closed book
consisting of policies issued between July 1, 2000 and June 30, 2010,
as well as the MMIP's assets related to those policies.

Subsection (c) would mandate the Superintendent to determine annually
whether the MMIP has sufficient monies to pay the MMIP's estimated
claims and expenses for the subsequent twelve months. If the monies
are insufficient, then the Superintendent is required to assess
liability insurers prior to imposing a surcharge on policies.

Subsection (d) would require an insurer to pay the assessment provided
for by subsection (c), which is not to exceed one-half percent of the
insurer's net direct premiums received during the prior calendar year.

Subsection (e) would require an insurer to include a separately
identifiable surcharge on premiums to offset the assessment.

Subsection (f) would exempt the assessment from certain taxation.

Subsection (g) would impose a penalty on an insurer that fails to pay
the assessment.

Subsection (h) would require the Superintendent to deposit the
assessment into the medical malpractice insurance fund established
under the State Finance Law.

Section 3 of the bill would add a new section 89-h to the State
Finance Law to establish the medical malpractice insurance fund for
the purpose of paying claims and expenses arising out of policies
issued by the MMIP between July 1, 2000 and June 30, 2010.

Section 4 of the bill would provide for an immediate effective date.

EXISTING LAW:

In 1986, the Legislature enacted Chapter 266 of the Laws of 1986. This
law requires the Superintendent of Insurance to establish medical
malpractice insurance rates for insurers on an annual basis. The
purpose of this legislation was to contain the spiraling cost of
medical malpractice insurance. Under the current rate setting
process, insurers file an "advisory rate" with the Superintendent on
an annual basis. The advisory rate is based on loss experience,
earned premiums, and other expenses. The Insurance Department
actuaries analyze the advisory rate filing and make a recommendation
to the Superintendent on the overall rate change for each insurer. In
2008 and again in 2009, the Legislature enacted a rate freeze on
medical malpractice insurance for physicians. The rate freeze is
scheduled to sunset on June 30, 2010.

Since 1975, the Medical Malpractice Insurance Association ("MMIA"),
pursuant to Article 55 of the Insurance Law, provided medical
malpractice insurance in New York. The MMIA was comprised of all
authorized property/casualty insurers in New York. Following the
dissolution of MMIA, Insurance Law § 5502(c)(2)(D) required the
Superintendent to promulgate regulations prescribing a plan for the
equitable distribution of MMIA insureds and health care practitioners
and facilities that are otherwise unable to secure coverage in the
voluntary market to authorized medical malpractice insurers writing
such coverage in the state, or to designate a single entity to
provide coverage consistent with an equitable plan of distribution.
Unlike the risks of its predecessor MMIA, which were apportioned
among all authorized property/casualty insurers, MMIP's risks are
apportioned only among authorized medical malpractice insurers in New
York. Unfortunately, MMIP has accumulated an undiscounted deficit
of approximateIy $465 million-a sum that, by law, must be shouldered
by the few companies selling,malpractice insurance in the state,
exerting further pressure on insurance rates.

LEGISLATIVE HISTORY:

This is a new bill.

STATEMENT IN SUPPORT:

This bill establishes an RSO for physicians and surgeons medical
malpractice insurance.
Currently, the Superintendent establishes the full physicians and
surgeons medical malpractice rate, which is comprised of the cost of
the actual loss (the "loss cost"), as well as the expenses that an
insurer has incurred, or will incur. The Superintendent establishes
this full rate for each classification of physicians and surgeons, as
well as for each insurer, which uses its own classification schedule.
The RSO will operate similar to the New York Compensation Rating
Board ("NYCIRB"), the RSO for workers' compensation insurance, in
order to bring more transparency and uniformity to the rate setting
process for physicians and surgeons medical malpractice insurance.

NYCIRB establishes only one loss cost for each classification across
workers' compensation insurers. NYCIRB is able to do so because it
has aggregated a rich collection of data in order to analyze the
experience, and arrive at the pure cost of loss. Each insurer may
file a deviation, which is subject to the Superintendent's approval,
from the loss cost, in addition to
its expense factor. This methodology ensures transparency in the rate
setting methodology, and helps to promote competitive pricing that
moderates the cost of insurance.

There is at present no central means to uniformly aggregate physicians
and surgeons medical malpractice insurance loss data. Furthermore,
the rating classifications differ among the various insurers in the
market. The physicians and surgeons RSO would collect and compile
data from insurers and, based upon its findings, provide information
to assist the Superintendent in establishing the rate, As credible
data aggregates Over a period of time, the RSO would be in a position
to develop standardized rate classifications that could promote a
more competitive market among insurers providing physicians and
surgeons medical malpractice insurance.

The RSO would be governed by a board of directors representing all
stakeholders in New York's medical malpractice insurance
market-including insurers, injured parties, and health care providers
- thereby ensuring that its decisions reflect the deliberations and
interests of all parties affected by its actions.

Establishing the RSO is a first-but significant- step toward
encouraging the development of a more stable and transparent medical
malpractice insurance market.

In addition, if the MMIP does not have sufficient monies to pay it
claims and expenses arising out of policies issued between July 1,
2000 and June 30, 2010, then the bill requires the Superintendent
to assess insurers writing liability insurance in New York for the
shortfall. Thus, the bill would eliminate the estimated $465 million
deficit incurred by the MMIP.

BUDGET IMPLICATIONS:

This bill will have no fiscal impact on the State.

EFFECTIVE DATE:

This bill will take effect immediately.

2009-S8274 (ACTIVE) - Bill Text download pdf

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

                                  8274

                            I N  S E N A T E

                              June 18, 2010
                               ___________

Introduced by Sen. BRESLIN -- (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 establishing a medical
  malpractice  insurance  rate  recommendation association; and to amend
  the state finance law, in relation to creating the medical malpractice
  insurance fund

  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 section 2352
to read as follows:
  S 2352. PHYSICIANS AND SURGEONS DATA COLLECTION AND  ADVISORY  ASSOCI-
ATION. IN THIS SECTION:
  (A)(1)  "PHYSICIANS  AND SURGEONS DATA COLLECTION AND ADVISORY ASSOCI-
ATION" OR "ASSOCIATION" MEANS THE ASSOCIATION  ESTABLISHED  PURSUANT  TO
THIS SECTION.
  (2)  "MEDICAL MALPRACTICE INSURANCE" HAS THE MEANING ASCRIBED TO IT BY
SUBSECTION (B) OF SECTION FIVE THOUSAND FIVE HUNDRED ONE OF  THIS  CHAP-
TER.
  (B)   A  NON-PROFIT,  UNINCORPORATED  ASSOCIATION  IS  HEREBY  CREATED
CONSISTING OF ALL INSURERS AUTHORIZED TO WRITE PERSONAL INJURY LIABILITY
INSURANCE AND ENGAGED IN WRITING, WITHIN THIS STATE, ON A DIRECT  BASIS,
INSURANCE POLICIES PROVIDING PHYSICIANS AND SURGEONS MEDICAL MALPRACTICE
INSURANCE.  A  PLAN  APPROVED BY THE SUPERINTENDENT PURSUANT TO SUBPARA-
GRAPH (D) OF PARAGRAPH TWO OF SUBSECTION (C) OF  SECTION  FIVE  THOUSAND
FIVE  HUNDRED  TWO  OF  THIS  CHAPTER SHALL ALSO BE A MEMBER. EVERY SUCH
INSURER SHALL BE A MEMBER OF THE ASSOCIATION AND SHALL REMAIN  A  MEMBER
AS  A CONDITION OF ITS AUTHORITY TO CONTINUE TO TRANSACT PERSONAL INJURY
LIABILITY INSURANCE IN THIS STATE.
  (C)(1) THE ASSOCIATION SHALL, PURSUANT TO THE PROVISIONS OF THIS ARTI-
CLE AND THE PLAN OF OPERATIONS:
  (A) COLLECT AND COMPILE PHYSICIANS AND  SURGEONS  MEDICAL  MALPRACTICE
PREMIUM  EXPOSURE,  LOSS AND EXPENSE STATISTICS, AND SUCH OTHER INFORMA-

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD12265-02-0

S. 8274                             2

TION AS THE SUPERINTENDENT MAY DEEM NECESSARY OR EXPEDIENT WITH  RESPECT
TO PHYSICIANS AND SURGEONS MEDICAL MALPRACTICE INSURANCE; AND
  (B)  PROVIDE  TO  THE  SUPERINTENDENT  PHYSICIANS AND SURGEONS MEDICAL
MALPRACTICE RATES OR RATE INFORMATION PURSUANT TO SUBSECTION (F) OF THIS
SECTION.
  (2) THE ASSOCIATION SHALL BE  A  RATE  SERVICE  ORGANIZATION  FOR  ALL
PURPOSES  UNDER  THIS CHAPTER EXCEPT FOR SUBSECTIONS (B), (C), (D), (F),
(G), (H), (I), (J), (K), (L), (P), (Q), (R), (S), AND (T) OF SECTION TWO
THOUSAND THREE HUNDRED THIRTEEN,  SECTION  TWO  THOUSAND  THREE  HUNDRED
FIFTEEN,  AND  PARAGRAPH  NINE OF SUBSECTION (A) OF SECTION TWO THOUSAND
THREE HUNDRED SIXTEEN OF THIS CHAPTER.
  (D)(1) WITHIN SIXTY DAYS FOLLOWING THE EFFECTIVE DATE OF THIS SECTION,
THE GOVERNING BODY OF THE ASSOCIATION SHALL SUBMIT  TO  THE  SUPERINTEN-
DENT,  FOR  APPROVAL, A PROPOSED PLAN OF OPERATION, WHICH SHALL INCLUDE:
(A) PRELIMINARY ASSESSMENT OF ALL MEMBERS FOR INITIAL EXPENSES NECESSARY
TO COMMENCE OPERATIONS; (B) ESTABLISHMENT OF NECESSARY  FACILITIES;  (C)
MANAGEMENT  OF  THE  ASSOCIATION; (D) ALLOCATION OF SUFFICIENT RESOURCES
FOR DATA-GATHERING; AND (E) ASSESSMENT OF MEMBERS TO DEFRAY EXPENSES.
  (2) THE GOVERNING BODY OF THE ASSOCIATION MAY AMEND THE PLAN OF OPERA-
TION SUBJECT TO THE SUPERINTENDENT'S APPROVAL, OR SHALL AMEND IT AT  THE
SUPERINTENDENT'S DIRECTION.
  (3)  THE  ASSOCIATION SHALL, FOR EXPENSES THAT IT INCURS IN ITS OPERA-
TION, ASSESS MEMBERS ON THE  BASIS  OF  DIRECT  WRITTEN  PREMIUMS,  LESS
RETURNS, RECEIVED BY THE MEMBER DURING THE PRIOR CALENDAR YEAR, ON POLI-
CIES  OF  PHYSICIANS  AND  SURGEONS  MEDICAL MALPRACTICE INSURANCE, WITH
RESPECT TO RISKS RESIDENT IN THIS STATE.    NOTHING  IN  THIS  PARAGRAPH
SHALL  PREVENT  THE ASSOCIATION FROM ALSO OBTAINING FUNDS FROM ANY OTHER
SOURCE.
  (E)(1)(A) THE GOVERNING BODY OF THE ASSOCIATION SHALL BE COMPRISED  OF
SEVEN VOTING MEMBERS. THREE MEMBERS SHALL REPRESENT THE INSURERS AUTHOR-
IZED  TO  WRITE PERSONAL INJURY LIABILITY INSURANCE AND ENGAGED IN WRIT-
ING, WITHIN THIS STATE, ON A DIRECT BASIS, INSURANCE POLICIES  PROVIDING
PHYSICIANS  AND  SURGEONS  MEDICAL  MALPRACTICE  INSURANCE, AND SHALL BE
SELECTED IN SUCH MANNER AS IS DETERMINED BY THE MEMBERS OF  THE  ASSOCI-
ATION.    ONE MEMBER SHALL BE A REPRESENTATIVE OF A PLAN APPROVED BY THE
SUPERINTENDENT FOR THE EQUITABLE DISTRIBUTION OF POLICIES FROM THE ASSO-
CIATION AUTHORIZED PURSUANT TO SUBPARAGRAPH  (D)  OF  PARAGRAPH  TWO  OF
SUBSECTION  (C)  OF SECTION FIVE THOUSAND FIVE HUNDRED TWO OF THIS CHAP-
TER. THE REMAINING THREE MEMBERS SHALL BE APPOINTED BY  THE  SUPERINTEN-
DENT  AND  REPRESENT  THE INTERESTS OF: (I) INJURED PARTIES; (II) PHYSI-
CIANS AND SURGEONS; AND (III) HOSPITALS.
  (B) ANY VACANCY IN THE GOVERNING BODY SHALL  BE  FILLED  IN  THE  SAME
MANNER AS THE INITIAL APPOINTMENT.
  (C)  THE  GOVERNING  BODY  SHALL  SELECT A CHIEF EXECUTIVE OFFICER WHO
SHALL SERVE AT THE PLEASURE OF THE GOVERNING BODY, AND WHOSE  TERMS  AND
CONDITIONS OF EMPLOYMENT SHALL BE APPROVED BY THE GOVERNING BODY.
  (D)  NO  RESTRICTION  IN  THIS SUBSECTION SHALL APPLY IF COMPLIANCE IS
PREVENTED BY THE FAILURE OF ANY APPOINTING AUTHORITY TO MAKE AN APPOINT-
MENT OR OF THE SUPERINTENDENT TO APPROVE SUCH APPOINTMENT.
  (2) THE GOVERNING BODY OF THE ASSOCIATION SHALL  HAVE  CHARGE  OF  THE
GENERAL ACTIVITIES OF THE ASSOCIATION, INCLUDING CONTROL AND SUPERVISION
OVER  ITS  FINANCES, AND AUTHORITY TO ESTABLISH BUDGETS, APPROVE ASSESS-
MENTS, AND IMPOSE FINES ON MEMBERS OF THE ASSOCIATION.
  (3)(A) THE ASSOCIATION SHALL HAVE AN ACTUARIAL COMMITTEE. THE ACTUARI-
AL COMMITTEE SHALL REVIEW METHODOLOGY AND DATA COLLECTION PROCESSES USED

S. 8274                             3

TO DEVELOP  RATES  AND  OTHER  INFORMATION  AS  THE  SUPERINTENDENT  MAY
REQUIRE.
  (B)  THE  MEMBERS  OF  THE  GOVERNING  BODY  REPRESENTING  THE INJURED
PARTIES, PHYSICIANS AND SURGEONS, AND HOSPITALS SHALL  TOGETHER  APPOINT
ONE  INDEPENDENT  CASUALTY  ACTUARY  WHO IS A FELLOW OR ASSOCIATE OF THE
CASUALTY ACTUARIAL SOCIETY TO SERVE AS A MEMBER OF THE ACTUARIAL COMMIT-
TEE. THE APPOINTMENT OF THE ACTUARY AND THE ACTUARY'S  COMPENSATION  AND
TERMS  AND CONDITIONS OF RETENTION SHALL BE REASONABLE AND CUSTOMARY FOR
SUCH PROFESSIONAL. THE ASSOCIATION SHALL PAY THE ACTUARY, WHO SHALL HAVE
THE SAME ACCESS TO THE ASSOCIATION  DATA  AND  DOCUMENTS  AS  THE  OTHER
MEMBERS OF THAT COMMITTEE.
  (F)(1)  EVERY  MEMBER  SHALL  FILE  WITH THE ASSOCIATION A STATISTICAL
REPORT, AS REQUIRED BY THE SUPERINTENDENT, BUT NOT LESS  THAN  ANNUALLY,
SHOWING  A  CLASSIFICATION  SCHEDULE  OF  ITS PREMIUMS AND LOSSES ON ITS
PHYSICIANS AND SURGEONS MEDICAL MALPRACTICE INSURANCE,  AND  SUCH  OTHER
INFORMATION  AS  THE  SUPERINTENDENT MAY DEEM NECESSARY OR EXPEDIENT FOR
THE ADMINISTRATION OF THE PROVISIONS OF THIS ARTICLE. THE SUPERINTENDENT
FROM TIME TO TIME MAY  PRESCRIBE  THE  FORM  OF  THE  REPORT,  INCLUDING
STATISTICAL DATA CONFORMING TO ESTABLISHED CLASSIFICATIONS.
  (2) THE ASSOCIATION SHALL RETAIN ALL DATA USED IN ITS CALCULATIONS AND
ANY OTHER DATA AS THE SUPERINTENDENT MAY REQUIRE FOR SUCH PERIOD OF TIME
AS THE SUPERINTENDENT SHALL DIRECT.
  (3)  IN ORDER TO ASSIST THE SUPERINTENDENT TO ESTABLISH PHYSICIANS AND
SURGEONS MEDICAL MALPRACTICE RATES, THE ASSOCIATION SHALL PROVIDE TO THE
SUPERINTENDENT ON OR BEFORE APRIL FIRST OF EACH YEAR A REPORT IN A  FORM
PRESCRIBED BY THE SUPERINTENDENT CONTAINING SUCH RATING AND OTHER INFOR-
MATION AS THE SUPERINTENDENT MAY REQUEST.
  S 2. The insurance law is amended by adding a new section 9112 to read
as follows:
  S  9112.  MEDICAL  MALPRACTICE  INSURANCE  FUND  ASSESSMENT.  (A)  FOR
PURPOSES OF THIS SECTION:
  (1) "CLOSED BOOK" SHALL MEAN THE MEDICAL MALPRACTICE INSURANCE  POOL'S
ACTUAL  AND  ESTIMATED  LIABILITIES  WITH RESPECT TO POLICIES OF MEDICAL
MALPRACTICE ISSUED THROUGH  THE  POOL  FROM  JULY  FIRST,  TWO  THOUSAND
THROUGH JUNE THIRTIETH, TWO THOUSAND TEN.
  (2) "MEDICAL MALPRACTICE INSURANCE" SHALL HAVE THE MEANING ASCRIBED TO
IT  BY  SUBSECTION (B) OF SECTION FIVE THOUSAND FIVE HUNDRED ONE OF THIS
CHAPTER.
  (3) "MEDICAL MALPRACTICE INSURANCE POOL"  OR  "POOL"  SHALL  MEAN  THE
ENTITY  ESTABLISHED  PURSUANT  TO  SUBPARAGRAPH  (D) OF PARAGRAPH TWO OF
SUBSECTION (C) OF SECTION FIVE THOUSAND FIVE HUNDRED TWO OF  THIS  CHAP-
TER.
  (4) "LIABILITY INSURANCE" SHALL MEAN "PERSONAL INJURY LIABILITY INSUR-
ANCE"  AND  "PROPERTY  DAMAGE  LIABILITY INSURANCE," AS DEFINED IN PARA-
GRAPHS THIRTEEN AND FOURTEEN OF SUBSECTION (A) OF SECTION  ONE  THOUSAND
ONE HUNDRED THIRTEEN OF THIS CHAPTER.
  (5)  "NET  DIRECT  WRITTEN  PREMIUMS" SHALL MEAN GROSS DIRECT PREMIUMS
WRITTEN ON POLICIES OF  LIABILITY  INSURANCE,  INCLUDING  THE  LIABILITY
COMPONENT  OF  MULTIPLE PERIL PACKAGE POLICIES AS COMPUTED BY THE SUPER-
INTENDENT, LESS RETURN PREMIUMS FOR THE UNUSED OR UNABSORBED PORTIONS OF
PREMIUM DEPOSITS AND DIVIDENDS PAID  TO  POLICYHOLDERS  ON  SUCH  DIRECT
BUSINESS.
  (B)(1)  THE  MEDICAL  MALPRACTICE  INSURANCE  POOL SHALL SUBMIT TO THE
SUPERINTENDENT NO LATER THAN AUGUST THIRTY-FIRST, TWO THOUSAND  TEN,  OR
THIRTY  DAYS  AFTER THE ENACTMENT OF THIS SECTION, WHICHEVER IS LATER, A

S. 8274                             4

PLAN TO OPERATE THE CLOSED BOOK FOR THE EXCLUSIVE BENEFIT OF  THE  POLI-
CIES AND CONTRACTS INCLUDED THEREIN.
  (2) TO THE CLOSED BOOK SHALL BE ALLOCATED ALL ASSETS OF THE POOL AS OF
JUNE  THIRTIETH,  TWO THOUSAND TEN, AND ANY EARNINGS THEREON, AS WELL AS
OTHER ASSETS, NOT INCONSISTENT WITH SECTION ONE THOUSAND  THREE  HUNDRED
ONE  OF  THIS  CHAPTER,  DEEMED  BY THE SUPERINTENDENT AVAILABLE FOR THE
PAYMENT OF LOSSES AND CLAIMS, AT VALUES DETERMINED  BY  THE  SUPERINTEN-
DENT.
  (3)  NONE OF THE ASSETS, INCLUDING THE REVENUE THEREFROM, ALLOCATED IN
ACCORDANCE WITH PARAGRAPH TWO OF THIS SUBSECTION  SHALL  REVERT  TO  THE
BENEFIT  OF  POLICYHOLDERS  WITH  RESPECT TO POLICIES ISSUED ON OR AFTER
JULY FIRST, TWO THOUSAND TEN.
  (C) THE SUPERINTENDENT SHALL  ANNUALLY,  ON  OR  BEFORE  APRIL  FIRST,
DETERMINE  WHETHER  THE  CLOSED  BOOK  HAS SUFFICIENT MONIES TO FUND ITS
ESTIMATED CLAIM PAYMENTS,  CLAIM  ADJUSTMENT  EXPENSES,  AND  ALL  OTHER
EXPENSES  FOR  THE SUBSEQUENT TWELVE MONTHS, WITH RESPECT TO POLICIES OF
MEDICAL MALPRACTICE INSURANCE ISSUED THROUGH THE POOL FROM  JULY  FIRST,
TWO  THOUSAND  THROUGH  JUNE  THIRTIETH, TWO THOUSAND TEN. IF THE SUPER-
INTENDENT DETERMINES THAT THE MONIES ARE INSUFFICIENT TO FUND THE  ESTI-
MATED EXPENSES AND PAYMENTS, THE SUPERINTENDENT SHALL ASSESS EACH INSUR-
ANCE COMPANY AUTHORIZED TO WRITE LIABILITY INSURANCE PRIOR TO IMPOSING A
SURCHARGE  ON  PREMIUMS  FOR POLICIES PROVIDING COVERAGE FOR PHYSICIANS'
AND SURGEONS' MEDICAL MALPRACTICE INSURANCE PURSUANT TO SECTION FORTY OF
CHAPTER TWO HUNDRED SIXTY-SIX OF THE LAWS OF NINETEEN HUNDRED EIGHTY-SIX
AS AMENDED.
  (D) THE SUPERINTENDENT SHALL DETERMINE THE ASSESSMENT IMPOSED PURSUANT
TO SUBSECTION (A) OF THIS SECTION ON THE BASIS  OF  NET  DIRECT  WRITTEN
PREMIUMS  RECEIVED  BY INSURERS DURING THE PRIOR CALENDAR YEAR, ON POLI-
CIES OF LIABILITY INSURANCE, WITH RESPECT TO PROPERTY OR RISKS  RESIDENT
IN  THIS  STATE;  PROVIDED, HOWEVER, THAT THE ASSESSMENT ON EACH INSURER
SHALL NOT EXCEED ONE-HALF PERCENT OF THE INSURANCE COMPANY'S NET  DIRECT
WRITTEN  PREMIUMS  RECEIVED DURING THE PRIOR CALENDAR YEAR. AN INSURANCE
COMPANY SHALL PAY THE ASSESSMENT  ON  A  QUARTERLY  BASIS  IN  A  MANNER
PRESCRIBED  BY THE SUPERINTENDENT ON THE FIFTEENTH DAY OF FEBRUARY, MAY,
AUGUST AND NOVEMBER OF EACH YEAR.
  (E) AN INSURANCE COMPANY SHALL INCLUDE A  SURCHARGE  ON  PREMIUMS  FOR
LIABILITY  INSURANCE POLICIES ON PROPERTIES OR RISKS LOCATED OR RESIDENT
IN THIS STATE TO OFFSET THE ASSESSMENTS PAID UNDER THIS SECTION  BY  THE
INSURANCE  COMPANY.  THE AMOUNT OF THE PREMIUM SURCHARGE SHALL BE EQUIV-
ALENT TO THE SUPERINTENDENT'S DETERMINATION PURSUANT TO  SUBSECTION  (B)
OF  THIS SECTION.   THE AMOUNT CHARGED ON THE POLICY SHALL BE SEPARATELY
SHOWN FROM THE PREMIUM FOR COVERAGE ON THE POLICY  AND  CLEARLY  IDENTI-
FIED.
  (F) AN AMOUNT EQUAL TO ANY ASSESSMENT IMPOSED BY THIS SECTION AND PAID
TO THE SUPERINTENDENT BY AN INSURANCE COMPANY:
  (1)  SHALL  BE  DEDUCTED  FROM  GROSS DIRECT PREMIUMS FOR ALL PURPOSES
UNDER ARTICLE THIRTY-THREE OF THE TAX LAW;
  (2) SHALL BE ALLOWED AS A CREDIT AGAINST AMOUNTS IMPOSED  PURSUANT  TO
SECTION ONE THOUSAND ONE HUNDRED TWELVE OF THIS CHAPTER; AND
  (3) IF APPLIED AS A CREDIT AGAINST AMOUNTS IMPOSED PURSUANT TO SECTION
ONE  THOUSAND  ONE  HUNDRED  TWELVE  OF  THIS CHAPTER, SHALL ALSO NOT BE
REFUNDABLE UNDER SECTION NINE THOUSAND ONE HUNDRED NINE OF THIS ARTICLE.
  (G) IF ANY INSURANCE COMPANY DOES NOT PAY THE  ASSESSMENT  IMPOSED  BY
THIS  SECTION,  THE PROVISIONS OF SECTION NINE THOUSAND ONE HUNDRED NINE
OF THIS ARTICLE SHALL APPLY.

S. 8274                             5

  (H) ALL MONIES RECEIVED BY THE SUPERINTENDENT THAT ARE COLLECTED  FROM
INSURANCE  COMPANIES  SHALL BE PAID TO THE MEDICAL MALPRACTICE INSURANCE
FUND ESTABLISHED PURSUANT TO SECTION EIGHTY-NINE-H OF THE STATE  FINANCE
LAW   BY  THE  TENTH  DAY  OF  THE  QUARTER  FOLLOWING  RECEIPT  OF  THE
COLLECTIONS.
  S  3. The state finance law is amended by adding a new section 89-h to
read as follows:
  S  89-H. MEDICAL MALPRACTICE INSURANCE FUND. 1. THERE IS HEREBY ESTAB-
LISHED IN THE JOINT CUSTODY OF THE STATE COMPTROLLER AND THE COMMISSION-
ER OF TAXATION AND FINANCE A SPECIAL FUND TO BE  KNOWN  AS  THE  MEDICAL
MALPRACTICE INSURANCE FUND.
  2. THE FUND SHALL CONSIST OF ALL MONIES RECEIVED BY THE STATE PURSUANT
TO  SECTION  NINE  THOUSAND ONE HUNDRED TWELVE OF THE INSURANCE LAW, AND
ALL OTHER GRANTS, BEQUESTS OR OTHER  MONIES  APPROPRIATED,  CREDITED  OR
TRANSFERRED THERETO FROM ANY OTHER FUND OR SOURCE.
  3.  MONIES  IN  THE  MEDICAL  MALPRACTICE INSURANCE FUND SHALL BE KEPT
SEPARATE AND APART AND SHALL NOT BE COMMINGLED WITH ANY OTHER MONIES  IN
THE  CUSTODY  OF THE COMPTROLLER AND SHALL ONLY BE EXPENDED AS SPECIFIED
IN THIS SECTION AND IN SUCH AMOUNTS AS APPROVED BY THE DIVISION  OF  THE
BUDGET.
  4. THE MONIES RECEIVED BY THE FUND SHALL BE EXPENDED TO PAY CLAIMS AND
NECESSARY  EXPENSES,  AS  CERTIFIED  BY THE SUPERINTENDENT OF INSURANCE,
ARISING FROM POLICIES OF MEDICAL MALPRACTICE INSURANCE, AS SUCH TERM  IS
DEFINED  IN  SUBSECTION (B) OF SECTION FIVE THOUSAND FIVE HUNDRED ONE OF
THE INSURANCE LAW, ISSUED THROUGH THE MEDICAL MALPRACTICE INSURANCE POOL
FROM JULY FIRST, TWO THOUSAND THROUGH JUNE THIRTIETH, TWO THOUSAND  TEN.
FOR PURPOSES OF THIS SECTION, "MEDICAL MALPRACTICE INSURANCE POOL" SHALL
MEAN  THE  ENTITY  ESTABLISHED PURSUANT TO SUBPARAGRAPH (D) OF PARAGRAPH
TWO OF SUBSECTION (C) OF SECTION FIVE THOUSAND FIVE HUNDRED TWO  OF  THE
INSURANCE LAW.
  S 4. This act shall take effect immediately.

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Senate Bill S8274

Sponsored By

Archive: Last Bill Status - In Senate Committee Rules Committee

2009-S8274 (ACTIVE) - Details

2009-S8274 (ACTIVE) - Summary

2009-S8274 (ACTIVE) - Sponsor Memo

2009-S8274 (ACTIVE) - Bill Text download pdf

Comments

Senate Bill S8274

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Sponsored By

Neil D. Breslin

Archive: Last Bill Status - In Senate Committee Rules Committee

2009-S8274 (ACTIVE) - Details

2009-S8274 (ACTIVE) - Summary

2009-S8274 (ACTIVE) - Sponsor Memo

2009-S8274 (ACTIVE) - Bill Text download pdf

Comments