Senate Bill S5192A

                                BILL NUMBER:S5192A

TITLE OF BILL:  An act to amend the insurance law, in relation to
authorizing the issuance of certain accident and health insurance
policies to an institution of higher education

PURPOSE: To clarify that insurers may issue dental, vision, and
intercollegiate sports injury coverage classified as "excepted
benefits" to institutions of higher education and to clarify that
student health insurance policies are considered to be secondary to
coverage provided for interscholastic sports injuries under a separate
accident policy or policies that meet the conditions provided in
3240(a)(1)(A)(ii)(I)-(VII) of the bill

SUMMARY OF PROVISIONS: The bill amends § 3240(a) of the insurance law
to clarify that New York law does not prohibit the issuance of
policies offering certain "excepted benefits," such as dental, vision,
or intercollegiate sports injury coverage, to institutions of higher
learning The bill also adds a new § 3240(j) of the insurance law to
clarify that an "intercollegiate sports injury" accident insurance
policy should be considered primary coverage and any "student accident
and health policy" issued to a college or university should be
considered secondary to such intercollegiate sports injury coverage,
so long as the coverage provided under the interscholastic sports
policy meets the conditions provided in § 3240(a)(1)(A)(ii)(I)-(VII)
of the bill,
              

EXISTING LAW: Existing law does not distinguish between traditional
student accident and health insurance policies providing coverage for
hospital, medical and surgical expense and policies of excepted
benefits (such as dental, vision, accident or supplemental insurance
policies) Current regulations allow for the exclusion of
interscholastic sports injuries in blanket policies; however, the
Department of Financial Services (DFS) has raised questions regarding
the permissibility of such exclusions, in view of recent statutory
changes. See 11 NYCRR 52 16(c)(4)(iv)

JUSTIFICATION: New York recently enacted legislation designed to
conform their requirements for student health insurance to the
requirements set forth in the Affordable Care Act ("ACA"), including
the ACA requirement that student health insurance policies include a
comprehensive set of "essential health benefits" which are not subject
to annual or lifetime dollar limitations. New York's conforming
legislation was aimed at traditional student health insurance policies
subject to ACA requirements Such policies are typically offered by
institutions of higher education as a comprehensive health insurance
option for students that do not have access to health insurance
through a parent's plan. However, New York's legislation did not
distinguish between traditional student health insurance policies and
"excepted benefits" policies such as accident, dental, and vision
policies, which are also currently being purchased by institutions of
higher learning.

New York has interpreted its ACA conforming legislation as requiring
all policies issued to students of institutions of higher education to
include comprehensive essential health benefits without annual or
life-time dollar limitations. This interpretation has raised questions


regarding whether it is permissible to issue student policies in the
college market providing dental coverage; vision coverage; and other
intercollegiate sports injury coverage recognized by the ACA as
"excepted benefits " Such policies do not offer "essential health
benefits" without limitation Dental policies, foi example, do not
typically include maternity or mammography benefits because it falls
outside of the intended scope of the policy.  However, dental policies
do provide students with important health coverage that may not be
included in their comprehensive medical plan. New York's
interpretation has also raised questions as to whether insurers can
provide institutions of higher learning with accident policies
protecting student athletes when they are injured during
intercollegiate sports competitions These policies are critical to the
financial well-being of the institutions and their students.

Relating to the intercollegiate sports injury coverage, the NCAA
currently extends catastrophic coverage to student athletes. The NCAA
picks up all of a student athlete's expenses over and above $90,000
Schools must find a way to cover the first $90,000 in expenses
(smaller colleges that do not participate in the NCAA have similar
arrangements with different athletic associations, although the dollar
amounts after which the athletic association assumes liability may
differ- i e , $25K or $50K). NCAA coverage is first dollar coverage
and it is available without restrictions as to networks or providers,
so the coverage is typically more flexible than the coverage available
to students for the first $90,000 in expenses NCAA coverage also has a
"longer tail" than the coverage provided by the college, which allows
athletes to receive benefits from the NCAA policy even after they have
graduated.

New York has interpreted its ACA conforming legislation to prohibit
insurers from issuing sports accident policies covering the first
$90,000 of a student athlete's expenses as required by the NCAA.
Additionally, New York has interpreted the conforming legislation as
prohibiting any coordination of benefits between student health
policies with accident policies providing coverage of interscholastic
sports injuries. Prohibiting coordination between student health
policies and the NCAA policies unnecessarily forces up the cost of
student health insurance premiums, which places New York's schools and
their sports programs at a financial disadvantage.

Although DFS has not directed companies to terminate existing excepted
benefits policies issued to institutions of higher education, DFS has
refused to approve policy amendments and new policies. Insurers and
institutions of higher education cannot operate effectively without
clarification.

Although DFS has not directed companies to terminate existing excepted
benefits policies issued to institutions of higher education, DFS has
refused to approve policy amendments and new policies. Insurers and
institutions of higher education cannot operate effectively without
clarification

LEGISLATIVE HISTORY: Section 3240 of the Insurance Law was enacted in
Part D of the FY 2013/14 Budget S 2606-d/A 3006-D

FISCAL IMPLICATIONS: None


EFFECTIVE DATE: This act shall take effect immediately and shall be
deemed to have been in full force and effect on the same date as
section 411 of part D of chapter 56 of the laws of 2013 took effect.