TITLE OF BILL: An act to amend the insurance law, in relation to
life, accident and health insurance; discriminating and rebating;
prohibited inducements and independent sales
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
and its resulting costs, and to assist insurers and employers in the
development and implementation of care coordination services and other
incidental or ancillary programs and services.
SUMMARY OF PROVISIONS: Section 1 of the bill would amend subsection
(f) of § 4224 of the insurance law by adding a new paragraph (3)
thereto, to allow licensed insurance producers without charging a
service fee, or in the case of licensed insurance brokers for a
separate service fee, to provide certain services to assist insurers
and, policyholders in the interpretation, management and communication
of health insurance policies and plans and their costs, including risk
assessment, insurance consultation and advice, insurance-related
regulatory & legislative updates, claims assistance services, tax
preparations services related to IRS Form 5500 Schedule A (Annual
Return/Report of Employee Benefit Plan), insurance plan information,
forms, administration, employee & subscriber enrollment services,
website links/employee benefit portals, answers to FAQs, COBRA
administration services, and HIPAA compliance services.
Section 2 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
producers, including 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 allowanced 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, without charging a service fee, or in the case of licensed
insurance brokers for a separate service fee.
Moreover, this bill would codify the incidental services excepted from
the insurance anti-rebating and inducement laws listed in NYS
Insurance Department Circular Letter No. 9 (2009)
LEGISLATIVE HISTORY: New bill.
FISCAL IMPLICATIONS: None.
EFFECTIVE DATE: Immediately.