senate Bill S4950

2011-2012 Legislative Session

Creates exceptions to the general prohibition on rebating

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Archive: Last Bill Status - Passed Senate


  • Introduced
  • In Committee
  • On Floor Calendar
    • Passed Senate
    • Passed Assembly
  • Delivered to Governor
  • Signed/Vetoed by Governor

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Actions

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Assembly Actions - Lowercase
Senate Actions - UPPERCASE
Jun 18, 2012 referred to insurance
delivered to assembly
passed senate
May 23, 2012 advanced to third reading
May 22, 2012 2nd report cal.
May 21, 2012 1st report cal.840
Jan 04, 2012 referred to insurance
May 02, 2011 referred to insurance

Votes

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S4950 - Bill Details

See Assembly Version of this Bill:
A9932
Current Committee:
Law Section:
Insurance Law
Laws Affected:
Amd §§3239 & 4224, Ins L

S4950 - Bill Texts

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Creates exceptions to the general prohibition on rebating.

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BILL NUMBER:S4950

TITLE OF BILL:
An act
to amend the insurance law, in relation to exceptions to the general
prohibition on rebating

PURPOSE:
To modernize the insurance law to allow licensed brokers, agents and
benefit consultants to assist insurers and employers in the
interpretation, management and communication of the insurance policy
or annuity contract and its resulting costs, and to assist insurers
and employers in the development and implementation of wellness
programs, disease management and care coordination services and other
incidental or ancillary programs and services.

SUMMARY OF PROVISIONS:
Section 1 of the bill would add a new subsection (d) to §3239 of the
insurance law, to enumerate certain exceptions to the anti-rebating
and inducement laws for services that insurance producers may provide
within the scope of their licensure and as part of commissions paid
or fees earned, to insurance carriers and policyholders, such as the
development and implementation of wellness programs, disease
management and care coordination services and other programs designed
to improve quality of care and health outcomes of insured employees,
subscribers or enrollees.

Section 2 of the bill would add a new subsection (f) to §4224 of the
insurance law, to allow insurance producers, within the scope of
their licensure and as part of commissions paid or fees earned, to
provide certain services to assist insurers and policyholders in the
interpretation, management and communication of insurance policies or
annuity contracts and their costs, as well as the development and
implementation of wellness programs, disease management and care
coordination services, administration of COBRA and New York State
continuation of coverage benefits, administration of flexible
spending accounts (FSAs) and health reimbursement or savings accounts
(HSAs), clinical health advocacy services, including employee,
subscriber or enrollee communications, hotlines, "help desks," and
web site development, preparation of annual benefit statements,
maintenance of membership records, premium reconciliation and billing
services, including retiree billing, compliance support, including
completion of ERISA form 5500, and financial modeling.

Section 3 of the bill would provide for an immediate effective date.

JUSTIFICATION:
The fast-paced and competitive insurance marketplace continues to
evolve, and insurance producers must change with it. Integral to this
is the modernization of certain statutory restrictions that are old
and outmoded. Chief amongst these are the anti-rebating and
inducement laws that were originally designed to protect insurance
producers and consumers alike from offering and accepting illegal
inducements for the sale of insurance products. In today's
sophisticated health insurance market, licensed insurance brokers,
agents and benefits consultants must be able to offer a full


value-added services platform, such as providing benefits concierge,
employee communications, benefits web sites and help desks, benefits
statements, compliance support, in order to attract business and
close the sale. Employer groups of all sizes are increasingly looking
not only for traditional advice in selecting health plan benefits
design and coverage options, underwriting to reduce claims losses,
and claims servicing and policyholder advocacy, but are also
demanding back-office human resources support.

The statutory exceptions and allowances prescribed in this bill would
modernize the insurance law with respect to health insurance, and
allow insurance producers to keep abreast of the market by lawfully
providing such services within the scope of their licensure and
practice and as part of commissions paid or fees earned.

Moreover, this bill would codify many of the incidental services
excepted from the insurance anti-rebating and inducement laws listed
in NYS Insurance Department Circular Letter No.9 (2009) -
http://www.ins.state.ny.us/circltr/2009/c109_09.htm

LEGISLATIVE HISTORY:
New bill.

FISCAL IMPLICATIONS:
None.

EFFECTIVE DATE:
This act shall take effect immediately.

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

                                  4950

                       2011-2012 Regular Sessions

                            I N  S E N A T E

                               May 2, 2011
                               ___________

Introduced  by  Sen.  SEWARD -- read twice and ordered printed, and when
  printed to be committed to the Committee on Insurance

AN ACT to amend the insurance law, in  relation  to  exceptions  to  the
  general prohibition on rebating

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

  Section 1. Section 3239 of the insurance law is amended  by  adding  a
new subsection (d) to read as follows:
  (D)  AN  INSURANCE  AGENT,  INSURANCE  BROKER  OR INSURANCE CONSULTANT
LICENSED UNDER ARTICLE TWENTY-ONE OF THIS CHAPTER, WHILE  ACTING  WITHIN
THE  SCOPE  OF  SUCH  LICENSURE AND AS PART OF COMMISSIONS PAID OR UNDER
SEPARATE FEE AGREEMENTS, SHALL BE  AUTHORIZED  TO  ASSIST  INSURERS  AND
EMPLOYERS  IN  THE  DEVELOPMENT AND IMPLEMENTATION OF WELLNESS PROGRAMS,
DISEASE MANAGEMENT  AND  CARE  COORDINATION  SERVICES,  AND  OTHER  SUCH
PROGRAMS  AND  SERVICES  DESIGNED  TO IMPROVE QUALITY OF CARE AND HEALTH
OUTCOMES OF INSURED EMPLOYEES, SUBSCRIBERS OR ENROLLEES, BASED ON  ACTU-
ARIAL  DEMONSTRATIONS  THAT SUCH PROGRAMS AND SERVICES CAN BE REASONABLY
EXPECTED TO RESULT IN THE OVERALL GOOD HEALTH  AND  WELL  BEING  OF  THE
GROUP.
  S  2.  Section  4224  of  the insurance law is amended by adding a new
subsection (f) to read as follows:
  (F) THIS SECTION SHALL NOT  PROHIBIT  AN  INSURANCE  AGENT,  INSURANCE
BROKER OR INSURANCE CONSULTANT LICENSED UNDER ARTICLE TWENTY-ONE OF THIS
CHAPTER,  WHILE ACTING WITHIN THE SCOPE OF SUCH LICENSURE AND AS PART OF
COMMISSIONS PAID OR UNDER SEPARATE FEE AGREEMENTS, FROM ASSISTING INSUR-
ERS AND EMPLOYERS IN THE INTERPRETATION, MANAGEMENT AND COMMUNICATION OF
THE INSURANCE POLICY  OR  ANNUITY  CONTRACT  AND  ITS  RESULTING  COSTS.
PERMISSIBLE  SERVICES  SHALL  INCLUDE,  BUT  NOT BE LIMITED TO: WELLNESS
PROGRAMS, DISEASE MANAGEMENT AND CARE  COORDINATION  SERVICES,  ADMINIS-
TRATION  OF  COBRA AND NEW YORK STATE CONTINUATION OF COVERAGE, ADMINIS-
TRATION OF FLEXIBLE SPENDING ACCOUNTS (FSAS)  AND  HEALTH  REIMBURSEMENT

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD11006-01-1

S. 4950                             2

ACCOUNTS  (HSAS), CLINICAL HEALTH ADVOCACY SERVICES, INCLUDING EMPLOYEE,
SUBSCRIBER OR ENROLLEE COMMUNICATIONS, HOTLINES, "HELP DESKS,"  AND  WEB
SITE  DEVELOPMENT, PREPARATION OF ANNUAL BENEFIT STATEMENTS, MAINTENANCE
OF  MEMBERSHIP  RECORDS,  PREMIUM  RECONCILIATION  AND BILLING SERVICES,
INCLUDING RETIREE BILLING, COMPLIANCE SUPPORT, INCLUDING  COMPLETION  OF
ERISA FORM 5500, AND FINANCIAL MODELING.
  S 3. This act shall take effect immediately.

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