senate Bill S7299

2013-2014 Legislative Session

Relates to life, accident and health insurance; discrimination and rebating; prohibited inducements and independent sales

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Archive: Last Bill Status - In Committee


  • 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 20, 2014 committed to rules
Jun 09, 2014 advanced to third reading
Jun 03, 2014 2nd report cal.
Jun 02, 2014 1st report cal.1103
May 09, 2014 referred to insurance

Votes

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Jun 2, 2014 - Insurance committee Vote

S7299
17
0
committee
17
Aye
0
Nay
2
Aye with Reservations
0
Absent
0
Excused
0
Abstained
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S7299 - Bill Details

See Assembly Version of this Bill:
A10006
Current Committee:
Senate Rules
Law Section:
Insurance Law
Laws Affected:
Amd §4224, Ins L

S7299 - Bill Texts

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Relates to life, accident and health insurance; relates to discrimination and rebating; also relates to prohibited inducements and independent sales.

view sponsor memo
BILL NUMBER:S7299

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)
http://www.ins.state.ny.us/circltr/2009/c109 09.htm

LEGISLATIVE HISTORY: New bill.

FISCAL IMPLICATIONS: None.

EFFECTIVE DATE: Immediately.

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

                                  7299

                            I N  S E N A T E

                               May 9, 2014
                               ___________

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  life,  accident  and
  health  insurance; discriminating and rebating; prohibited inducements
  and independent sales

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

  Section  1.  Subsection  (f)  of  section 4224 of the insurance law is
amended by adding a new paragraph 3 to read as follows:
  (3) NOTWITHSTANDING SUBSECTION (C) OF THIS SECTION, A  LICENSED  AGENT
OR  INSURANCE BROKER MAY PROVIDE THE FOLLOWING SERVICES WITHOUT CHARGING
A SERVICE FEE OR, IN THE CASE OF A  LICENSED  INSURANCE  BROKER,  FOR  A
SEPARATE SERVICE FEE PURSUANT TO A WRITTEN MEMORANDUM MADE IN ACCORDANCE
WITH  SUBSECTION (C) OF SECTION TWO THOUSAND ONE HUNDRED AND NINETEEN OF
THIS CHAPTER, IF SUCH SERVICES ARE PROVIDED IN A FAIR AND NONDISCRIMINA-
TORY MANNER AND INCIDENTAL TO A GROUP OR BLANKET POLICY OR CONTRACT SOLD
BY THE INSURANCE AGENT OR INSURANCE BROKER:
  (I) RISK ASSESSMENT, INCLUDING IDENTIFYING SOURCES OF RISK AND  DEVEL-
OPING STRATEGIES FOR ELIMINATING OR LIMITING THOSE RISKS;
  (II) INSURANCE CONSULTING SERVICES OR OTHER INSURANCE-RELATED ADVICE;
  (III) INSURANCE-RELATED REGULATORY AND LEGISLATIVE UPDATES;
  (IV)  CERTAIN CLAIMS ASSISTANCE SERVICES (INCLUDING THE PREPARATION OF
CLAIMS FORMS), BUT EXCLUDING ADJUSTMENT, UNLESS THE EXCEPTIONS SET FORTH
IN SUBSECTION (G) OF SECTION TWO THOUSAND ONE HUNDRED AND  ONE  OF  THIS
CHAPTER ARE SATISFIED;
  (V)  TAX  PREPARATION  ON  BEHALF  OF AN EMPLOYER OF SCHEDULE A OF THE
INTERNAL REVENUE SERVICE FORM FIFTY-FIVE HUNDRED ANNUAL RETURN/REPORT OF
EMPLOYEE BENEFIT PLAN, WHICH REQUESTS  INFORMATION  REGARDING  INSURANCE
CONTRACT   COVERAGE,  FEES,  AND  COMMISSIONS,  INVESTMENT  AND  ANNUITY
CONTRACTS, AND WELFARE BENEFIT CONTRACTS;
  (VI) INFORMATION TO GROUP POLICY OR CONTRACT HOLDERS AND MEMBERS UNDER
GROUP INSURANCE POLICIES CURRENTLY IN PLACE, AS WELL AS FORMS NEEDED FOR
PLAN ADMINISTRATION, ENROLLMENT IN A PLAN, INSURER  WEBSITE  LINKS,  AND
ANSWERS  TO FREQUENTLY ASKED QUESTIONS RELATED TO THE INSURANCE (INCLUD-

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD15061-01-4

S. 7299                             2

ING, FOR EXAMPLE, ACCESS THROUGH A WEBSITE,  CREATED  BY  THE  INSURANCE
PRODUCER, TO AN EMPLOYEE BENEFIT PORTAL THAT CONTAINS SUCH INFORMATION);
  (VII)  CERTAIN SERVICES PERFORMED PURSUANT TO THE FEDERAL CONSOLIDATED
OMNIBUS BUDGET  RECONCILIATION  ACT  (COBRA),  SUCH  AS  BILLING  FORMER
EMPLOYES,  COLLECTING  THE INSURANCE PREMIUMS, AND FORWARDING THE AGGRE-
GATE PREMIUMS TO THE EMPLOYER POLICY OR CONTRACT HOLDER OR TO THE INSUR-
ER, WHEN OFFERED IN CONNECTION WITH THE PROVISION OF ACCIDENT AND HEALTH
INSURANCE; AND
  (VIII) CERTAIN SERVICES PROVIDED IN ACCORDANCE WITH THE FEDERAL HEALTH
INSURANCE PORTABILITY AND ACCOUNTABILITY ACT, SUCH AS  THOSE  PERTAINING
TO  HEALTH  CARE  ACCESS, PORTABILITY, AND RENEWABILITY, WHEN OFFERED IN
CONNECTION WITH THE PROVISION OF ACCIDENT AND HEALTH INSURANCE.
  S 2. This act shall take effect immediately.

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