S T A T E   O F   N E W   Y O R K
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                                  7314

                            I N  S E N A T E

                               May 2, 2012
                               ___________

Introduced  by  Sens.  SEWARD, O'MARA -- 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  self-funded  student
  health benefit plans

  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 80  to
read as follows:
                               ARTICLE 80
                SELF-FUNDED STUDENT HEALTH BENEFIT PLANS
SECTION 8000. PURPOSE.
        8001. DEFINITIONS.
        8002. MINIMUM STANDARDS FOR PLANS.
        8003. APPLICATION.
        8004. AGREEMENT.
        8005. PERIODIC REPORTS OF SELF-INSURERS.
        8006. SUSPENSION OR REVOCATION OF APPROVAL.
        8007. DISCONTINUANCE OF PLAN.
  S 8000. PURPOSE. THE PURPOSE OF THIS ARTICLE IS TO SET FORTH STANDARDS
AND  PROCEDURES  FOR  NOT-FOR-PROFIT  PRIVATE AND PUBLIC INSTITUTIONS OF
HIGHER EDUCATION WHICH PROVIDE FOUR YEAR BACHELOR'S DEGREE PROGRAMS  AND
GRADUATE  OR  PROFESSIONAL DEGREE PROGRAMS, AND WHICH HAVE ENDOWMENTS OF
AT LEAST ONE BILLION DOLLARS, TO OBTAIN AUTHORIZATION TO PROVIDE FOR THE
HEALTH INSURANCE NEEDS OF THEIR  STUDENTS  BY  IMPLEMENTING  SELF-FUNDED
STUDENT HEALTH BENEFIT PLANS.
  S  8001.  DEFINITIONS. FOR THE PURPOSES OF THIS ARTICLE, THE FOLLOWING
TERMS SHALL HAVE THE FOLLOWING MEANINGS:
  (A) "PLAN" SHALL MEAN A SELF-FUNDED STUDENT HEALTH BENEFIT PLAN  MEET-
ING THE REQUIREMENTS OF SECTION EIGHT THOUSAND TWO OF THIS ARTICLE.
  (B)  "QUALIFIED  ACTUARY"  SHALL MEAN A MEMBER IN GOOD STANDING OF THE
AMERICAN ACADEMY OF ACTUARIES, A PERSON RECOGNIZED BY THE AMERICAN ACAD-
EMY OF ACTUARIES AS QUALIFIED TO  PREPARE  ACTUARIAL  VALUATIONS,  OR  A
PERSON WHO OTHERWISE HAS DEMONSTRATED THEIR COMPETENCY IN SUCH ACTUARIAL
VALUATION TO THE SATISFACTION OF THE SUPERINTENDENT.

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

                                                           LBD15135-01-2

S. 7314                             2

  (C)  "SELF-INSURER"  MEANS A UNIVERSITY WHICH HAS BEEN APPROVED BY THE
SUPERINTENDENT TO PROVIDE FOR THE HEALTH INSURANCE NEEDS OF ITS STUDENTS
BY IMPLEMENTING A PLAN.
  (D)  "UNIVERSITY" MEANS A NOT-FOR-PROFIT PRIVATE OR PUBLIC INSTITUTION
OF HIGHER EDUCATION WITHIN THE MEANING OF 20 U.S.C.,  S  1001  WHICH  IS
GOVERNED BY THE NEW YORK STATE BOARD OF REGENTS, AND WHICH PROVIDES FOUR
YEAR  BACHELOR'S  DEGREE  PROGRAMS  AND  GRADUATE OR PROFESSIONAL DEGREE
PROGRAMS.
  S 8002. MINIMUM STANDARDS FOR PLANS.  A  PLAN  MUST  COMPLY  WITH  THE
FOLLOWING MINIMUM STANDARDS:
  (A)  ELIGIBILITY.  EACH PLAN SHALL DETERMINE THE SPECIFIC CRITERIA FOR
STUDENT ELIGIBILITY. A PLAN MAY PROVIDE OPTIONS FOR COVERAGE FOR  SPOUS-
ES,  DEPENDENTS,  EXTENDED  DEPENDENT  COVERAGE,  UNMARRIED  STUDENTS ON
MEDICAL LEAVE OF ABSENCE, UNMARRIED DISABLED CHILDREN, NEWBORN  INFANTS,
ADOPTED  CHILDREN  AND  STEP-CHILDREN,  DOMESTIC PARTNERS AND NEW FAMILY
MEMBERS AND PROVIDE FOR ENROLLMENT BY NEW STUDENTS AND THEIR  DEPENDENTS
AND  OPEN ENROLLMENT BY CURRENT STUDENTS AND THEIR DEPENDENTS IN ACCORD-
ANCE WITH AT LEAST THE MINIMUM REQUIREMENTS SET FORTH IN SUBSECTION  (C)
OF  SECTION  FOUR  THOUSAND THREE HUNDRED FIVE AND SECTION FOUR THOUSAND
THREE HUNDRED SIX-A OF THIS CHAPTER AND PART FIFTY-TWO OF  TITLE  ELEVEN
OF THE OFFICIAL COMPILATION OF CODES, RULES AND REGULATIONS OF THE STATE
OF NEW YORK.
  (B)  MANDATORY  COVERED BENEFITS. EACH PLAN SHALL PROVIDE COVERAGE FOR
PRIMARY  AND  PREVENTATIVE  HEALTH  SERVICES,  COUNSELING,  PREVENTATIVE
OBSTETRIC AND GYNECOLOGICAL CARE, MAMMOGRAPHY SCREENING, CERVICAL CYTOL-
OGY  SCREENING,  BONE  MINERAL  DENSITY  MEASUREMENTS OR TESTS, DRUG AND
DEVICES, PROSTATE CANCER  SCREENING,  MASTECTOMY  CARE,  POST-MASTECTOMY
RECONSTRUCTION,  EMERGENCY  SERVICES,  PREADMISSION TESTING, HOME HEALTH
SERVICES, MATERNITY CARE, DIABETES EQUIPMENT, SUPPLIES AND  SELF-MANAGE-
MENT  EDUCATION, OUTPATIENT SUBSTANCE ABUSE SERVICES, PRE-HOSPITAL EMER-
GENCY MEDICAL SERVICES,  AUTISM  SPECTRUM  DISORDER,  DIRECT  ACCESS  TO
OB/GYN  SERVICES,  SECOND  MEDICAL  OPINION FOR CANCER DIAGNOSIS, SECOND
SURGICAL OPINION,  CHIROPRACTIC  CARE,  MENTAL,  NERVOUS  AND  EMOTIONAL
DISORDERS  IN COMPLIANCE WITH THE FEDERAL MENTAL HEALTH PARITY ADDICTION
EQUITY ACT OF 2008, SERVICES PERFORMED AT COMPREHENSIVE CARE CENTER  FOR
EATING DISORDERS, PRESCRIPTION DRUGS INCLUDING ENTERAL FORMULAS, OFF-LA-
BEL  CANCER  DRUG USAGE, CONTRACEPTIVE DRUGS AND DEVICES, CHEMICAL ABUSE
AND DEPENDENCE DIAGNOSIS AND TREATMENT, AMBULATORY CARE, LICENSED  CLIN-
ICAL  SOCIAL  WORKERS  AND  REGISTERED PROFESSIONAL NURSES IN ACCORDANCE
WITH AT LEAST THE MINIMUM REQUIREMENTS OF SECTIONS FOUR  THOUSAND  THREE
HUNDRED THREE, FOUR THOUSAND THREE HUNDRED TWENTY-FOUR AND FOUR THOUSAND
NINE  HUNDRED  OF THIS CHAPTER AND PART FIFTY-TWO OF TITLE ELEVEN OF THE
OFFICIAL COMPILATION OF CODES, RULES AND REGULATIONS OF THE STATE OF NEW
YORK.
  (C) MANDATORY STANDARD PROVISIONS. EACH PLAN SHALL INCLUDE  PROVISIONS
CONCERNING  COST  OF SERVICE, TIME FRAME TO SUBMIT CLAIMS, SUSPENSION OF
COVERAGE WHILE ON ACTIVE DUTY WITH THE ARMED  FORCES  AND  EXTENSION  OF
BENEFITS  IN  ACCORDANCE  WITH  AT  LEAST  THE  MINIMUM  REQUIREMENTS OF
SECTIONS THREE THOUSAND TWO HUNDRED ONE AND FOUR THOUSAND THREE  HUNDRED
FIVE  OF THIS CHAPTER AND PART FIFTY-TWO OF TITLE ELEVEN OF THE OFFICIAL
COMPILATION OF CODES, RULES AND REGULATIONS OF THE STATE OF NEW YORK.
  (D) OPTIONAL STANDARD PROVISIONS. EACH  PLAN  MAY  INCLUDE  PROVISIONS
CONCERNING:
  (1) SUBROGATION, IN COMPLIANCE WITH SECTION 5-335 OF THE GENERAL OBLI-
GATIONS LAW; AND

S. 7314                             3

  (2)  THE  COORDINATION  OF  BENEFITS  AND  UNILATERAL  MODIFICATION AS
PROVIDED FOR IN PART FIFTY-TWO OF TITLE ELEVEN OF THE OFFICIAL  COMPILA-
TION OF CODES, RULES AND REGULATIONS OF THE STATE OF NEW YORK.
  (E) PERMISSIBLE EXCLUSIONS. EACH PLAN MAY INCLUDE PROVISIONS PROVIDING
EXCLUSIONS  FOR CLAIMS FOR, OR ARISING FROM COSMETIC SURGERY, FOOT CARE,
DENTAL CARE OR TREATMENT, EYEGLASSES AND HEARING AIDS,  CUSTODIAL  CARE,
REST  CURES,  WAR OR ACT OF WAR, PARTICIPATION IN FELONY, RIOT OR INSUR-
RECTION, SERVICE IN ARMED FORCES, ACCIDENT  OR  SICKNESS  COVERED  UNDER
MANDATORY  NO-FAULT,  WORKERS'  COMPENSATION,  MEDICARE OR OTHER GOVERN-
MENTAL PROGRAMS,  SEPARATELY  BILLED  SERVICES  BY  HOSPITAL  EMPLOYEES,
SERVICES BY MEMBER OF A STUDENT'S OR COVERED DEPENDENT'S IMMEDIATE FAMI-
LY,  SERVICES  FOR  WHICH  NO  CHARGE IS NORMALLY MADE, SERVICES COVERED
UNDER VALID AND  COLLECTIBLE  MEDICAL,  HEALTH  OR  ACCIDENT  INSURANCE,
SERVICES  OUTSIDE THE UNITED STATES AS PROVIDED FOR IN PART FIFTY-TWO OF
TITLE ELEVEN OF THE OFFICIAL COMPILATION OF CODES, RULES AND REGULATIONS
OF THE STATE OF NEW YORK.  SUBJECT TO THE DISCRETION OF THE  SUPERINTEN-
DENT, ADDITIONAL EXCLUSIONS MAY BE INCLUDED.
  (F)  WRITTEN  DISCLOSURE STATEMENT. IN ADDITION TO PROVIDING NOTICE TO
STUDENTS AND  THEIR  COVERED  DEPENDENTS  OF  ELIGIBILITY  REQUIREMENTS,
COVERED  BENEFITS, STANDARD PROVISIONS, OPTIONAL STANDARD PROVISIONS AND
PERMISSIBLE EXCLUSIONS, THE WRITTEN  DISCLOSURE  STATEMENT  PROVIDED  TO
STUDENTS  AND  THEIR  COVERED  DEPENDENTS  MUST  INCLUDE A DEFINITION OF
MEDICAL NECESSITY, AND SET FORTH THE PLAN'S PRIOR AUTHORIZATION REQUIRE-
MENTS, UTILIZATION  REVIEW  POLICIES  AND  PROCEDURES,  EXTERNAL  APPEAL
PROCEDURES, REIMBURSEMENT OF PROVIDERS POLICIES, THE STUDENT'S FINANCIAL
RESPONSIBILITY   FOR   PAYMENT,  POLICIES  CONCERNING  NON-PARTICIPATING
PROVIDERS AND NON-AUTHORIZED SERVICES,  GRIEVANCE  PROCEDURES,  POLICIES
AND  PROCEDURES  CONCERNING  THE  SELECTION,  ACCESSING  AND CHANGING OF
PARTICIPATING PROVIDERS, REFERRAL TO NON-PARTICIPATING PROVIDERS, STAND-
ING  REFERRALS,  SPECIALTY  CARE  PROVIDER  AS  PRIMARY  CARE  PROVIDER,
SPECIALTY  CARE CENTERS, ACCESS TO TRANSITIONAL CARE, NON-ENGLISH SPEAK-
ING STUDENTS, CONTACT INFORMATION AND PROVIDER INFORMATION  AS  PROVIDED
FOR  IN  SECTIONS THREE THOUSAND TWO HUNDRED THIRTY-EIGHT, FOUR THOUSAND
TWO HUNDRED TWENTY-FOUR, FOUR THOUSAND THREE HUNDRED SIX, FOUR  THOUSAND
THREE HUNDRED TWENTY-FOUR AND ARTICLE FORTY-NINE OF THIS CHAPTER.
  (G)  MINIMUM MEDICAL LOSS RATIOS. UNLESS WAIVED BY THE SUPERINTENDENT,
THE PERCENTAGE OF CHARGES COLLECTED  FROM  STUDENTS  AND  THEIR  COVERED
DEPENDENTS  USED TO PAY CLAIMS UNDER A PLAN MUST EQUAL OR EXCEED EIGHTY-
TWO PERCENT, OR SUCH GREATER PERCENTAGE AS MAY BE PROVIDED  UNDER  REGU-
LATIONS  APPLICABLE  TO  INSURED  STUDENT HEALTH INSURANCE/BENEFIT PLANS
PROMULGATED BY THE UNITED STATES DEPARTMENT OF HEALTH AND HUMAN SERVICES
IN ACCORDANCE WITH  ALL  APPLICABLE  FEDERAL  LAW.  IN  CALCULATING  THE
EXPENSES  THAT CAN AND CANNOT BE COUNTED TOWARDS CALCULATION OF A PLAN'S
MEDICAL LOSS RATIO, A PLAN MUST APPLY THE APPLICABLE DEFINITIONS, FORMU-
LAE AND PROCEDURAL REQUIREMENTS SET FORTH IN THE NATIONAL ASSOCIATION OF
INSURANCE COMMISSIONER'S MODEL REGULATION FOR  UNIFORM  DEFINITIONS  AND
STANDARDIZED METHODOLOGIES FOR CALCULATION OF THE MEDICAL LOSS RATIO FOR
PLAN  YEARS  TWO  THOUSAND  ELEVEN, TWO THOUSAND TWELVE AND TWO THOUSAND
THIRTEEN PER SECTION 2718(B) OF THE FEDERAL PUBLIC HEALTH  SERVICE  ACT.
IF  A  SIMILAR  REGULATION  IS PROMULGATED BY THE SUPERINTENDENT, A PLAN
MUST APPLY THE APPLICABLE DEFINITIONS, FORMULAE AND PROCEDURAL  REQUIRE-
MENTS  SET  FORTH  IN SUCH REGULATION. NOTWITHSTANDING THE FOREGOING, NO
PLAN SHALL BE REQUIRED TO MAKE A REFUND OF FEES PAID TO THE PLAN BY,  OR
ON  BEHALF  OF,  ANY  COVERED PERSON IF THE PLAN'S MEDICAL LOSS RATIO IS
LESS THAN THE RATIO SET FORTH IN A REGULATION PROMULGATED BY THE  SUPER-
INTENDENT  OR  THE  RATIO  PROVIDED UNDER REGULATIONS PROMULGATED BY THE

S. 7314                             4

UNITED STATES DEPARTMENT OF HEALTH AND HUMAN SERVICES. TO THE  EXTENT  A
REFUND OF FEES WOULD OTHERWISE BE REQUIRED UNDER ANY SUCH REGULATIONS, A
PLAN  SHALL  BE  AUTHORIZED  TO  RETAIN SUCH FEES FOR THE BENEFIT OF THE
PLAN.
  (H)  BENEFIT  MAXIMUM. A PLAN MUST PROVIDE A MAXIMUM ANNUAL BENEFIT AT
LEAST EQUAL TO THE MAXIMUM ANNUAL BENEFIT  REQUIRED  FOR  FULLY  INSURED
STUDENT  HEALTH INSURANCE PLANS UNDER ALL APPLICABLE FEDERAL LAW AND THE
REGULATIONS APPLICABLE TO FULLY INSURED STUDENT HEALTH  INSURANCE  PLANS
PROMULGATED  BY  THE  UNITED  STATES  DEPARTMENT  OF  HEALTH  AND  HUMAN
SERVICES.
  (I) THIRD PARTY TRANSACTIONS. A UNIVERSITY'S TRANSACTIONS  WITH  THIRD
PARTIES  IN  CONNECTION  WITH A PLAN MUST SATISFY THE FOLLOWING REQUIRE-
MENTS:
  (1) THE TERMS SHALL BE FAIR AND EQUITABLE;
  (2) CHARGES OR FEES FOR SERVICES PERFORMED SHALL BE REASONABLE; AND
  (3) EXPENSES INCURRED SHALL BE ALLOCATED TO THE UNIVERSITY ON AN EQUI-
TABLE BASIS IN CONFORMITY WITH GENERALLY ACCEPTED ACCOUNTING  PRINCIPLES
CONSISTENTLY APPLIED.
  IN  ADDITION,  THE  BOOKS,  ACCOUNTS  AND RECORDS OF EACH PARTY TO ALL
TRANSACTIONS BETWEEN A UNIVERSITY AND A THIRD PARTY IN CONNECTION WITH A
PLAN SHALL BE MAINTAINED SO AS TO CLEARLY AND  ACCURATELY  DISCLOSE  THE
NATURE AND DETAILS OF THE TRANSACTION INCLUDING SUCH ACCOUNTING INFORMA-
TION  AS  IS  NECESSARY  TO SUPPORT THE REASONABLENESS OF ALL CHARGES OR
FEES PAID BY A UNIVERSITY TO SUCH THIRD PARTIES.
  S 8003. APPLICATION. (A) (1) EVERY UNIVERSITY DESIRING TO IMPLEMENT  A
PLAN SHALL MAKE AN APPLICATION IN FORM PRESCRIBED BY THE SUPERINTENDENT.
THIS APPLICATION SHALL CONTAIN:
  (A)  A REPORT INDICATING MEDICAL LOSSES (PAYMENTS PLUS RESERVES) ASSO-
CIATED WITH THE  UNIVERSITY'S  STUDENTS  UNDER  THE  UNIVERSITY'S  FULLY
INSURED  STUDENT  HEALTH INSURANCE PLANS, FOR A PERIOD UP TO THREE YEARS
PRIOR TO THE DATE OF APPLICATION;
  (B) THE MOST RECENT, CERTIFIED, INDEPENDENTLY AUDITED FINANCIAL STATE-
MENT OF THE UNIVERSITY;
  (C) A NARRATIVE DESCRIPTION OF THE UNIVERSITY'S PROPOSED PLAN, INCLUD-
ING A DESCRIPTION OF ALL CHARGES AND FEES TO BE CHARGED BY THE  PLAN  TO
STUDENTS  FOR  HEALTH BENEFITS. AN ACTUARIAL REPORT PREPARED BY A QUALI-
FIED ACTUARY SUPPORTING THE CHARGES AND FEES TO BE CHARGED BY  THE  PLAN
TO   STUDENTS   FOR   HEALTH  BENEFITS  SHALL  ACCOMPANY  THE  NARRATIVE
DESCRIPTION;
  (D) A NARRATIVE DESCRIPTION OF HOW THE PLAN WILL ADMINISTER PLAN BENE-
FITS AND REQUIREMENTS AND ADJUST CLAIMS. IF THE UNIVERSITY'S  PLAN  DOES
NOT  UTILIZE  UNIVERSITY  EMPLOYEES TO ADMINISTER PLAN BENEFITS REQUIRE-
MENTS AND ADJUST  CLAIMS,  THE  NARRATIVE  DESCRIPTION  MUST  INCLUDE  A
DESCRIPTION  OF THE ARRANGEMENT ENTERED INTO BY THE PLAN WITH A LICENSED
INDEPENDENT ADJUSTER WHICH WILL ADMINISTER PLAN  BENEFITS  AND  REQUIRE-
MENTS  AND  ADJUST  CLAIMS ON BEHALF OF THE PLAN. A COPY OF THE SERVICES
AGREEMENT BETWEEN  THE  PLAN  AND  THE  INDEPENDENT  ADJUSTER  SHALL  BE
INCLUDED WITH THE APPLICATION;
  (E) A PRO-FORMA STATEMENT OF OBLIGATIONS, EXPENSES, MEDICAL LOSSES AND
CHARGES  AND FEES TO BE CHARGED BY THE PLAN TO STUDENTS FOR HEALTH BENE-
FITS DURING THE NEXT THREE YEARS; AND
  (F) A NARRATIVE DESCRIPTION OF THE ACCOUNTING METHODOLOGY  WHICH  WILL
BE UTILIZED BY THE PLAN, INCLUDING A DESCRIPTION OF THE SEPARATE ACCOUNT
FOR  CLAIMS,  EXPENSES,  LOSSES,  INCURRED-BUT-NOT-REPORTED  LOSSES  AND
RESERVES WHICH WILL BE CREATED WITHIN THE UNIVERSITY'S GENERAL  ACCOUNT-
ING LEDGER SYSTEM.

S. 7314                             5

  (2)  A UNIVERSITY SEEKING TO QUALIFY AS A SELF-INSURER, SHALL CAUSE TO
BE PAID INTO A  RESERVE  FUND  THE  AMOUNTS  NECESSARY  TO  SATISFY  ALL
CONTRACTUAL OBLIGATIONS AND LIABILITIES OF THE PLAN, INCLUDING:
  (A)  A RESERVE FOR PAYMENT OF CLAIMS AND EXPENSES THEREON REPORTED BUT
NOT YET PAID, AND CLAIMS AND  EXPENSES  THEREON  INCURRED  BUT  NOT  YET
REPORTED  WHICH  SHALL  NOT  BE LESS THAN AN AMOUNT EQUAL TO TWENTY-FIVE
PERCENT OF EXPECTED INCURRED CLAIMS AND EXPENSES THEREON FOR THE CURRENT
PLAN YEAR, UNLESS A QUALIFIED ACTUARY HAS  DEMONSTRATED  TO  THE  SUPER-
INTENDENT'S SATISFACTION THAT A LESSER AMOUNT WILL BE ADEQUATE;
  (B) A RESERVE FOR UNEARNED PREMIUM EQUIVALENTS; AND
  (C) A SURPLUS ACCOUNT, ESTABLISHED AND MAINTAINED FOR THE SOLE PURPOSE
OF  SATISFYING UNEXPECTED OBLIGATIONS OF THE PLAN IN THE EVENT OF TERMI-
NATION OF THE PLAN, WHICH SHALL NOT BE LESS THAN: FIVE  PERCENT  OF  THE
ANNUALIZED  EARNED PREMIUM EQUIVALENTS DURING THE CURRENT FISCAL YEAR OF
THE PLAN.
  ONE OF THE WAYS A QUALIFIED ACTUARY  MAY  DEMONSTRATE  THAT  A  LESSER
AMOUNT  OF A RESERVE FOR PAYMENT OF CLAIMS AND EXPENSES THEREON REPORTED
BUT NOT YET PAID, AND CLAIMS AND EXPENSES THEREON INCURRED BUT  NOT  YET
REPORTED WILL BE ADEQUATE IS BY SHOWING THAT THE UNIVERSITY HAS OBTAINED
A  MEDICAL  STOP-LOSS  INSURANCE  POLICY  ISSUED BY AN INSURANCE CARRIER
AUTHORIZED BY THE SUPERINTENDENT TO WRITE  MEDICAL  STOP-LOSS  INSURANCE
POLICIES IN NEW YORK STATE.
  THE  ASSETS CONSTITUTING THE PLAN'S RESERVE FUNDS SHALL CONSIST SOLELY
OF CERTIFICATES OF DEPOSIT ISSUED BY A UNITED STATES BANK AND PAYABLE IN
UNITED STATES LEGAL TENDER, AND/OR SECURITIES  REPRESENTING  INVESTMENTS
OF  THE  TYPES SPECIFIED IN PARAGRAPHS ONE, TWO, THREE, EIGHT AND TEN OF
SUBSECTION (A) OF SECTION ONE THOUSAND FOUR HUNDRED FOUR OF  THIS  CHAP-
TER,  OR  AS  OTHERWISE  EXPRESSLY  PERMITTED BY THE SUPERINTENDENT. ANY
INTEREST EARNED OR CAPITAL GAIN REALIZED ON THE MONEY  SO  DEPOSITED  OR
INVESTED  SHALL ACCRUE TO AND BECOME PART OF THE PLAN'S RESERVE FUNDS OR
SURPLUS ACCOUNT, AS APPLICABLE.
  THE PLAN'S RESERVE FUNDS SHALL BE ACCOUNTED  FOR  SEPARATE  AND  APART
FROM ALL OTHER FUNDS OF THE UNIVERSITY, AND SUCH ACCOUNTING SHALL SHOW:
  (I)  THE  PURPOSE,  SOURCE,  DATE AND AMOUNT OF EACH SUM PAID INTO THE
FUNDS;
  (II) THE INTEREST EARNED BY SUCH FUNDS;
  (III) CAPITAL GAINS OR LOSSES RESULTING FROM THE SALE  OF  INVESTMENTS
OF THE PLAN'S RESERVE FUNDS;
  (IV)  THE  ORDER,  PURPOSE,  DATE  AND AMOUNT OF EACH PAYMENT FROM THE
RESERVE FUND; AND
  (V) THE ASSETS OF THE FUND, INDICATING CASH BALANCE  AND  SCHEDULE  OF
INVESTMENTS.
  THE  REQUIREMENTS  FOR  FUNDING  OF  THE PLAN'S RESERVE FUNDS SHALL BE
CALCULATED USING GENERALLY ACCEPTED ACCOUNTING PRINCIPLES ("GAAP"). ONLY
THOSE EXPENSES WHICH RELATE TO THE PLAN MAY BE INCLUDED  IN  CALCULATING
THE  REQUIREMENTS  FOR  FUNDING  OF THE PLAN'S RESERVE FUNDS.   EXPENSES
ALLOCATED TO THE PLAN SHALL  BE  ALLOCATED  ON  AN  EQUITABLE  BASIS  IN
CONFORMITY  WITH  GAAP  CONSISTENTLY  APPLIED.  THE  BOOKS, ACCOUNTS AND
RECORDS OF THE PLAN SHALL BE MAINTAINED AS  TO  CLEARLY  AND  ACCURATELY
DISCLOSE  THE  NATURE  AND  DETAILS OF ALL EXPENSES SO AS TO SUPPORT THE
REASONABLENESS OF SUCH EXPENSES.
  (B) IF, UPON  EXAMINATION  OF  THE  CERTIFIED,  INDEPENDENTLY  AUDITED
FINANCIAL  STATEMENT  OF  THE  UNIVERSITY  AND OTHER DATA SUBMITTED, THE
SUPERINTENDENT IS SATISFIED AS TO  THE  ABILITY  OF  THE  UNIVERSITY  TO
FULFILL ITS OBLIGATION UNDER THE PLAN AND THAT THE UNIVERSITY'S TANGIBLE
ASSETS  AND  FINANCIAL  HISTORY MAKE THE PAYMENT OF ALL OBLIGATIONS THAT

S. 7314                             6

MAY ARISE UNDER THE PLAN, REASONABLY CERTAIN,  THE  APPLICATION  MAY  BE
GRANTED  SUBJECT  TO  THE CONDITIONS HEREIN PROVIDED. THE SUPERINTENDENT
WILL NOTIFY THE UNIVERSITY OF APPROVAL OR NON-APPROVAL OF  ITS  APPLICA-
TION WITHIN NINETY DAYS.
  (C)  TO  ENSURE  CONTINUING  COMPLIANCE  WITH THE REQUIREMENTS OF THIS
ARTICLE AND THE PLAN WHICH HAS BEEN APPROVED BY THE SUPERINTENDENT,  THE
SUPERINTENDENT  SHALL  BE  AUTHORIZED, PURSUANT TO SECTION THREE HUNDRED
NINE OF THIS CHAPTER, TO MAKE AN EXAMINATION INTO  THE  AFFAIRS  OF  ANY
SELF-INSURER AS OFTEN AS HE OR SHE DEEMS IT EXPEDIENT FOR THE PROTECTION
OF THE INTERESTS OF THE PEOPLE OF THIS STATE.
  S  8004. AGREEMENT. A UNIVERSITY MAKING AN APPLICATION WITH THE SUPER-
INTENDENT FOR AUTHORITY TO IMPLEMENT A PLAN SHALL EXECUTE AND FILE  WITH
THE SUPERINTENDENT AN AGREEMENT, IN PRESCRIBED FORM:
  (A) TO PAY ALL OBLIGATIONS AND EXPENSES ARISING UNDER ITS PLAN;
  (B) TO COMPLY WITH ALL CONSUMER PROTECTION LAWS AND REGULATIONS OF THE
STATE  OF  NEW  YORK,  INCLUDING,  BUT  NOT  LIMITED TO, THE PROHIBITION
AGAINST DECEPTIVE BUSINESS PRACTICES SET FORTH IN SECTION THREE  HUNDRED
FORTY-NINE OF THE GENERAL BUSINESS LAW; AND
  (C)  TO  PROVIDE  THE  SUPERINTENDENT  WITH  SIXTY DAYS' PRIOR WRITTEN
NOTICE OF ANY DECISION TO TERMINATE ITS PLAN FOR ANY REASON.
  S 8005. PERIODIC REPORTS OF SELF-INSURERS. (A) REPORTS SHALL BE  FILED
WITH THE SUPERINTENDENT, BY EACH SELF-INSURER AS FOLLOWS:
  (1)  THE MOST RECENT CERTIFIED, INDEPENDENTLY AUDITED FINANCIAL STATE-
MENT OF THE SELF-INSURER;
  (2) A STATEMENT OF OBLIGATIONS, EXPENSES, MEDICAL LOSSES  AND  CHARGES
AND FEES PAID TO THE SELF-INSURER'S PLAN BY STUDENTS FOR HEALTH BENEFITS
DURING ITS MOST RECENT FISCAL OR PLAN YEAR;
  (3)   THE   IDENTITY   OF   THE  QUALIFIED  ACTUARY  UTILIZED  BY  THE
SELF-INSURER'S PLAN TOGETHER WITH THE FEES PAID TO THE QUALIFIED ACTUARY
BY THE SELF-INSURER'S PLAN DURING ITS MOST RECENT FISCAL OR PLAN YEAR;
  (4) THE IDENTITY OF THE SELF-INSURER'S PLAN'S TEN LARGEST  VENDORS  BY
PAYMENT AMOUNT DURING ITS MOST RECENT FISCAL OR PLAN YEAR;
  (5)  THE IDENTITY AND CONTACT INFORMATION FOR THE PERSON ACTING AS THE
ADMINISTRATOR OF THE  SELF-INSURER'S  PLAN.  THE  PERSON  DESIGNATED  AS
ADMINISTRATOR  WILL  BE THE PERSON TO WHOM ALL INQUIRIES FROM THE SUPER-
INTENDENT CONCERNING THE SELF-INSURER'S PLAN SHALL BE DIRECTED;
  (6) A PRO-FORMA STATEMENT OF OBLIGATIONS,  EXPENSES,  MEDICAL  LOSSES,
AND  CHARGES  AND FEES TO BE PAID TO THE SELF-INSURER'S PLAN BY STUDENTS
FOR HEALTH BENEFITS ANTICIPATED BY THE SELF-INSURER'S PLAN FOR THE  NEXT
TWELVE MONTH PERIOD OF THE PLAN'S OPERATION. THE PRO-FORMA STATEMENT CAN
BE PROVIDED ON EITHER A FISCAL YEAR OR A PLAN YEAR BASIS;
  (7)  A  STATEMENT OF OBLIGATIONS, EXPENSES, MEDICAL LOSSES AND CHARGES
AND FEES PAID TO THE SELF-INSURER'S PLAN BY STUDENTS  FOR  HEALTH  BENE-
FITS;
  (8)  A  DETAILED  REPORT OF THE OPERATIONS AND CONDITION OF THE PLAN'S
RESERVE FUNDS; AND
  (9) ADDITIONAL OR MORE  FREQUENT  REPORTS  OR  STATEMENTS  AS  MAY  BE
REQUESTED BY THE SUPERINTENDENT.
  (B)  THE REPORTS CALLED FOR IN SUBSECTION (A) OF THIS SECTION SHALL BE
FILED NO LATER THAN APRIL FIRST OF EACH YEAR, RELATING TO THE PRIOR YEAR
ENDING DECEMBER THIRTY-FIRST, WITH THE EXCEPTION OF  THE  REPORT  CALLED
FOR  IN  PARAGRAPH  ONE OF SUBSECTION (A) OF THIS SECTION WHICH SHALL BE
FILED NO LATER THAN MAY FIRST OF EACH YEAR, RELATING TO THE  PRIOR  YEAR
ENDING  DECEMBER  THIRTY-FIRST,  UNLESS  IT  MAINTAINS A FISCAL YEAR, IN
WHICH CASE, RELATING TO THE PRIOR FISCAL YEAR.

S. 7314                             7

  S 8006. SUSPENSION OR REVOCATION OF APPROVAL. (A)  THE  SUPERINTENDENT
MAY  SUSPEND  OR  REVOKE  THE  APPROVAL ISSUED TO A SELF-INSURER FOR THE
ESTABLISHMENT OF A PLAN FOR ANY CAUSE THAT WOULD BE THE BASIS FOR DENIAL
OF AN INITIAL APPLICATION FOR SUCH APPROVAL, OR FOR FAILURE TO  MAINTAIN
THE  RESERVE  FUNDS  REQUIRED  UNDER  PARAGRAPH TWO OF SUBSECTION (A) OF
SECTION EIGHT THOUSAND THREE OF THIS ARTICLE;  PROVIDED,  HOWEVER,  THAT
THE  SUPERINTENDENT  SHALL NOT SUSPEND OR REVOKE AN APPROVAL IF THE PLAN
HAS IMPLEMENTED A REMEDIATION PLAN ACCEPTABLE TO THE SUPERINTENDENT.  IN
ADDITION TO THE FOREGOING, THE SUPERINTENDENT MAY ALSO SUSPEND OR REVOKE
THE APPROVAL ISSUED TO A SELF-INSURER FOR THE ESTABLISHMENT OF A PLAN IF
THE SELF-INSURER HAS REFUSED TO PRODUCE ITS ACCOUNTS, RECORDS, AND FILES
FOR EXAMINATION, OR  IF  ANY  REPRESENTATIVE  OF  THE  SELF-INSURER  HAS
REFUSED  TO COOPERATE OR GIVE INFORMATION WITH RESPECT TO THE AFFAIRS OF
THE PLAN OR PERFORM ANY OTHER LEGAL OBLIGATION RELATING TO SUCH EXAMINA-
TION WHEN REQUIRED BY THE SUPERINTENDENT.
  (B) IN THE CASE OF SUSPENSION OR REVOCATION OF AN APPROVAL ISSUED TO A
SELF-INSURER, THE SUPERINTENDENT SHALL SEND A COPY OF SUCH  DECISION  TO
THE UNIVERSITY BY CERTIFIED MAIL AT THE PLAN'S ADDRESS. UPON THE REQUEST
OF  THE UNIVERSITY, FILED WITHIN SIXTY DAYS OF THE MAILING OF THE SUPER-
INTENDENT'S DECISION, THE SUPERINTENDENT SHALL  SCHEDULE  A  HEARING  ON
SUCH DECISION BY WRITTEN NOTICE, SENT BY CERTIFIED MAIL TO THE UNIVERSI-
TY.  SUCH NOTICE SHALL SET FORTH A SPECIFIC DATE, TIME AND PLACE FOR THE
HEARING, WHICH SHALL COMMENCE WITHIN SIXTY DAYS OF THE  MAILING  OF  THE
NOTICE.
  S  8007.  DISCONTINUANCE  OF  PLAN. (A) A UNIVERSITY WHICH HAS HAD ITS
APPROVAL SUSPENDED OR REVOKED OR WHICH HAS DETERMINED TO  TERMINATE  ITS
PLAN FOR ANY REASON SHALL FILE A SWORN STATEMENT WITH THE SUPERINTENDENT
CONCERNING  ALL  CURRENT  AND  FUTURE LIABILITIES UNDER ITS DISCONTINUED
PLAN. IN ADDITION, THE UNIVERSITY SHALL  ALSO  SUBMIT  A  PLAN  FOR  THE
SUPERINTENDENT'S APPROVAL FOR WINDING UP THE PLAN'S AFFAIRS IN AN ORDER-
LY  MANNER DESIGNED TO RESULT IN TIMELY PAYMENT OF ALL BENEFITS, IN SUCH
FORM AND MANNER AS THE SUPERINTENDENT MAY PRESCRIBE.
  (B) UNTIL SUCH TIME AS ALL CURRENT  AND  FUTURE  LIABILITIES  UNDER  A
DISCONTINUED  PLAN  HAVE  BEEN  FULLY  AND FINALLY PAID OR ELIMINATED, A
UNIVERSITY SHALL  CONTINUE  TO  MAINTAIN  AND  FUND  THE  RESERVE  FUNDS
REQUIRED  TO  BE  ESTABLISHED  UNDER  PARAGRAPH TWO OF SUBSECTION (A) OF
SECTION EIGHT THOUSAND THREE OF THIS  ARTICLE.  DURING  SUCH  PERIOD,  A
UNIVERSITY  SHALL HONOR ANY DIRECTIVES FROM THE SUPERINTENDENT REQUIRING
THE UNIVERSITY  TO  SATISFY  PLAN  OBLIGATIONS  TO  PAY  ANY  CLAIMS  OR
EXPENSES.  IF,  AT ANY TIME, IT IS DETERMINED BY THE SUPERINTENDENT THAT
ADDITIONAL FUNDS ARE REQUIRED TO BE DEPOSITED INTO  THE  RESERVE  FUNDS,
THE UNIVERSITY SHALL MAKE SUCH DEPOSIT OR DEPOSITS WITHIN THIRTY DAYS OF
SUCH  DETERMINATION.    NO  PART  OF  THE  PLAN'S RESERVE FUNDS SHALL BE
SUBJECT TO THE CLAIMS OF GENERAL CREDITORS OF  A  UNIVERSITY  UNTIL  ALL
PLAN BENEFITS AND OTHER PLAN OBLIGATIONS HAVE BEEN SATISFIED.
  (C)  AFTER  THE  LAPSE  OF TWENTY-FOUR MONTHS, IF ALL CLAIMS UNDER THE
DISCONTINUED PLAN HAVE BEEN FINALLY AND FULLY PAID, AND ALL EXPENSES AND
ASSESSMENTS REQUIRED BY LAW HAVE BEEN PAID, THE ASSETS WITHIN THE PLAN'S
RESERVE FUNDS SHALL NO  LONGER  BE  REQUIRED  TO  BE  MAINTAINED  WITHIN
RESTRICTED  ACCOUNTS  WITHIN  THE UNIVERSITY'S GENERAL ACCOUNTING LEDGER
SYSTEM.
  S 2. This act shall take effect on the one hundred twentieth day after
it shall have become a law. Effective immediately, the addition,  amend-
ment and/or repeal of any rule or regulation necessary for the implemen-
tation  of this act on its effective date is authorized to be made on or
before such date.