Senate Bill S7065B

2015-2016 Legislative Session

Requires long term care insurance carriers who propose to raise long term care insurance premiums to obtain prior approval of the superintendent of financial services

download bill text pdf

Archive: Last Bill Status - In Senate Committee Insurance Committee

Introduced
- In Committee Assembly
- In Committee Senate
- On Floor Calendar Assembly
- On Floor Calendar Senate
- Passed Assembly
- Passed Senate
Delivered to Governor
Signed By Governor

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Actions

View Actions

Date of Action	Assembly Actions - Lowercase Senate Actions - UPPERCASE
May 12, 2016	print number 7065b
May 12, 2016	amend and recommit to insurance
Apr 27, 2016	print number 7065a
Apr 27, 2016	amend and recommit to insurance
Mar 22, 2016	referred to insurance

Bill Amendments

Original

B (Active)

2015-S7065 - Details

See Assembly Version of this Bill:: A9683
Current Committee:: Senate Insurance
Law Section:: Insurance Law
Laws Affected:: Amd §1117, Ins L
Versions Introduced in Other Legislative Sessions:: 2017-2018: S3389, A2055
2019-2020: S6674, A2941
2021-2022: S19, A5827
2023-2024: A1812
2025-2026: A2465

2015-S7065 - Summary

Requires long term care insurance carriers who propose to raise long term care insurance premiums to obtain prior approval of the superintendent of financial services.

2015-S7065 - Sponsor Memo

                                 BILL NUMBER:  S7065

 TITLE OF BILL :

An act to amend the insurance law, in relation to requiring long term
care insurance carriers who propose to raise long term care insurance
premiums to obtain prior approval of the superintendent of financial
services

 PURPOSE OR GENERAL IDEA OF BILL :

The purpose of this legislation is to establish a process and
timeframe for the Department of Financial Services to provide public
notice and notice to policy holders prior to approval of changes to
long term care (LTC) insurance premiums. In addition, the bill
requires the Department of Financial Services to approve such changes
prior to implementation. This bill addresses a serious problem that
has occurred when long term care insurance providers increase rates
without any consumer notice or opportunity to challenge, and when such
increases are not in the best interests of policy holders.

 SUMMARY OF SPECIFIC PROVISIONS :

Section 1 of the bill amends section 3229 (a) and (b) of the insurance
law by omitting the word "certain" from the provisions for minimum
standards for a long term care insurance plan and adds a new

subsection (c). The added subsection (c) (1) (A) requires an insurer
desiring to increase or decrease premiums for a long term care
insurance policy to submit a rate filing or application to the
superintendent of financial services and send written notice of the
proposed rate adjustment to each policy and certificate holder
affected by the adjustment. The superintendent is required to post a
copy of the notice on the department's website immediately. Within 30
days from the date that the filing or application is submitted, those
affected by the adjustment can contact the department of financial
services or the insurer to receive additional information or may
submit written comments. The superintendent is required to post all
relevant written comments received pertaining to rate filings or
applications on the department's website in a timely manner. The
superintendent shall determine whether the filing or application will
be approved as filed or modified or disapproved. If the superintendent
finds that the premiums are unreasonable, excessive, inadequate, or
unfairly discriminatory, the superintendent may modify or disapprove
the filing or application. The superintendent's determination must be
rendered in writing between 30-60 days from the date the filing or
application is submitted and must be supported by sound actuarial
assumptions and methods. If the superintendent needs additional
information from the insurer in order to make a determination, the
superintendent is authorized to require the insurer to furnish such
information, and the 60 day timeframe will be tolled and will resume
as of the date the requested information is received. If the
superintendent does not render a decision within the time allotted
under this section, the filing or application will be deemed approved.
After an insurer's filing or application is deemed approved, the
insurer must provide at least 60 days advance written notice of the
premium rate adjustment to each affected policy holder and certificate
holder before such rate adjustment is implemented.

Section 2 provides the effective date.

 JUSTIFICATION :

Long term care insurance helps cover the cost of care and daily
activities that people may need as they age. Medicare generally does
not pay for long term care, and therefore many people sign up for long

term care insurance assuming they will not have to pay for such
expenses out of pocket later in life.

Many residents with long term care insurance policies have complained
about the sudden rise in the costs of their insurance premiums.
Recently, many consumers have seen their premiums increase at rates as
high as 60%. Under current law, long term care insurance providers in
New York State are not required to receive prior approval from the
state Department of Financial Services before increasing or decreasing
premiums nor are insurers required to notify policy holders of such
rate changes. The rising premiums rates and lack of notification are
problematic for consumers, especially for those who purchased policies
with the understanding that their premiums would not change, as well
as for those who did not receive prior notice of the premium
increases.

According to the National Association of Insurance Commissioners, over
half of the states in the country have laws or regulations which
require long term care insurance providers to submit notification or
approval to the Director or Commissioner of their state's Insurance
Department of a proposed premium rate schedule increase or decrease.
Many of these states also require providers to notify policy holders
of such proposed rate change. New York State is one of 14 states
nationwide without these consumer-protection and prior approval
provisions.

This legislation will safeguard long term care insurance consumers
from being hit with unjustified and unexpected increased premiums by
requiring insurers to submit an application to DFS justifying the
proposed premium increase, notifying policy holders and requiring DFS
approval of such requests.

 PRIOR LEGISLATIVE HISTORY :

New Bill

 FISCAL IMPLICATIONS :

To be determined.

 EFFECTIVE DATE :
This bill shall take effect immediately.

2015-S7065 - Bill Text download pdf

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

                                  7065

                            I N  S E N A T E

                             March 22, 2016
                               ___________

Introduced  by  Sen. KRUEGER -- 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  requiring  long  term
  care  insurance carriers who propose to raise long term care insurance
  premiums to obtain prior approval of the superintendent  of  financial
  services

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

  Section 1. Section 3229 of the insurance law, as  amended  by  chapter
659  of  the  laws  of 1997, paragraph 2 of subsection (a) as amended by
chapter 6 of the laws of 2015, paragraph 3 of subsection (a) as  amended
by section 27 of part B of chapter 58 of the laws of 2004 and subsection
(b) as amended by chapter 572 of the laws of 2008, is amended to read as
follows:
  S  3229. Minimum benefit standards for [certain] long term care plans.
(a) The minimum standards for an insurance plan, which may qualify under
the partnership for long term care program  pursuant  to  section  three
hundred  sixty-seven-f  of the social services law, shall be established
by regulations of the superintendent, in consultation with  the  commis-
sioner  of health and the director of the state office for the aging, as
approved by the director of the budget, which shall require at a minimum
(1) a residential health care facility benefit in an amount to be deter-
mined by the regulations of the superintendent; (2) a home care  benefit
with personal care, nursing care, adult day health care and respite care
services,  which shall provide total benefits in an amount determined by
regulations of the superintendent; (3) a duration of benefits  not  less
than  twelve months; and (4) arrangements through the insurance plan for
managed care including preauthorized assessment and  referral  programs,
utilization controls and use of approved providers.
  (b)  In  establishing  minimum  benefit  standards for insurance plans
pursuant to this section, the superintendent shall seek  to  ensure  the
cost  effectiveness of the partnership for long term care program estab-
lished pursuant to section three hundred  sixty-seven-f  of  the  social
services  law, and may establish minimum permissible payments under such

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

                                                           LBD14483-02-6

S. 7065                             2

insurance plans. The superintendent shall not approve an insurance  plan
which includes an exclusion for pre-existing conditions that exceeds six
months, or which does not comply with paragraph six of subsection (b) of
section one thousand one hundred seventeen of this chapter.
  (C) AN INSURER DESIRING TO INCREASE OR DECREASE PREMIUMS FOR ANY POLI-
CY  SUBJECT TO THIS SECTION SHALL SUBMIT A RATE FILING OR APPLICATION TO
THE SUPERINTENDENT.   AN  INSURER  SHALL  SEND  WRITTEN  NOTICE  OF  THE
PROPOSED  RATE  ADJUSTMENT,  INCLUDING THE SPECIFIC CHANGE REQUESTED, TO
EACH POLICY HOLDER AND CERTIFICATE HOLDER AFFECTED BY THE ADJUSTMENT  ON
OR  BEFORE  THE  DATE THE RATE FILING OR APPLICATION IS SUBMITTED TO THE
SUPERINTENDENT. THE NOTICE SHALL PROMINENTLY INCLUDE MAILING AND WEBSITE
ADDRESSES FOR BOTH THE DEPARTMENT OF FINANCIAL SERVICES AND THE  INSURER
THROUGH  WHICH  A  PERSON MAY, WITHIN THIRTY DAYS FROM THE DATE THE RATE
FILING OR APPLICATION IS SUBMITTED TO THE  SUPERINTENDENT,  CONTACT  THE
DEPARTMENT OF FINANCIAL SERVICES OR INSURER TO RECEIVE ADDITIONAL INFOR-
MATION  OR  TO  SUBMIT  WRITTEN  COMMENTS TO THE DEPARTMENT OF FINANCIAL
SERVICES ON THE RATE FILING OR  APPLICATION.  THE  SUPERINTENDENT  SHALL
ESTABLISH  A  PROCESS  TO POST ON SUCH DEPARTMENT'S WEBSITE, IN A TIMELY
MANNER, ALL  RELEVANT  WRITTEN  COMMENTS  RECEIVED  PERTAINING  TO  RATE
FILINGS  OR APPLICATIONS. THE INSURER SHALL PROVIDE A COPY OF THE NOTICE
TO THE SUPERINTENDENT WITH THE RATE FILING OR  APPLICATION.  THE  SUPER-
INTENDENT SHALL IMMEDIATELY CAUSE THE NOTICE TO BE POSTED ON THE DEPART-
MENT  OF FINANCIAL SERVICES' WEBSITE. THE SUPERINTENDENT SHALL DETERMINE
WHETHER THE FILING OR APPLICATION SHALL BECOME EFFECTIVE AS FILED, SHALL
BECOME EFFECTIVE AS MODIFIED, OR SHALL BE DISAPPROVED.  THE  SUPERINTEN-
DENT  MAY  MODIFY  OR  DISAPPROVE  THE RATE FILING OR APPLICATION IF THE
SUPERINTENDENT FINDS THAT  THE  PREMIUMS  ARE  UNREASONABLE,  EXCESSIVE,
INADEQUATE,  OR  UNFAIRLY DISCRIMINATORY, AND MAY CONSIDER THE FINANCIAL
CONDITION OF THE INSURER WHEN APPROVING, MODIFYING OR  DISAPPROVING  ANY
PREMIUM  ADJUSTMENT.  THE  DETERMINATION  OF THE SUPERINTENDENT SHALL BE
SUPPORTED BY SOUND ACTUARIAL  ASSUMPTIONS  AND  METHODS,  AND  SHALL  BE
RENDERED IN WRITING BETWEEN THIRTY AND SIXTY DAYS FROM THE DATE THE RATE
FILING  OR  APPLICATION  IS  SUBMITTED TO THE SUPERINTENDENT. SHOULD THE
SUPERINTENDENT REQUIRE ADDITIONAL INFORMATION FROM THE INSURER IN  ORDER
TO MAKE A DETERMINATION, THE SUPERINTENDENT SHALL REQUIRE THE INSURER TO
FURNISH  SUCH  INFORMATION,  AND  IN SUCH EVENT, THE SIXTY DAYS SHALL BE
TOLLED AND SHALL RESUME AS OF THE DATE THE INSURER FURNISHES THE  INFOR-
MATION  TO THE SUPERINTENDENT. IF THE SUPERINTENDENT REQUESTS ADDITIONAL
INFORMATION LESS THAN TEN DAYS FROM THE EXPIRATION  OF  THE  SIXTY  DAYS
(EXCLUSIVE  OF  TOLLING),  THE  SUPERINTENDENT  MAY EXTEND THE SIXTY DAY
PERIOD AN ADDITIONAL TWENTY DAYS TO MAKE A DETERMINATION.  THE  APPLICA-
TION  OR  RATE  FILING WILL BE DEEMED APPROVED IF A DETERMINATION IS NOT
RENDERED WITHIN THE TIME ALLOTTED UNDER THIS SECTION. AN  INSURER  SHALL
NOT  IMPLEMENT  A  RATE  ADJUSTMENT UNLESS THE INSURER PROVIDES AT LEAST
SIXTY DAYS  ADVANCE  WRITTEN  NOTICE  OF  THE  PREMIUM  RATE  ADJUSTMENT
APPROVED  BY  THE  SUPERINTENDENT  TO EACH POLICY HOLDER AND CERTIFICATE
HOLDER AFFECTED BY THE RATE ADJUSTMENT.
  S 2. This act shall take effect immediately.

2015-S7065A - Details

See Assembly Version of this Bill:: A9683
Current Committee:: Senate Insurance
Law Section:: Insurance Law
Laws Affected:: Amd §1117, Ins L
Versions Introduced in Other Legislative Sessions:: 2017-2018: S3389, A2055
2019-2020: S6674, A2941
2021-2022: S19, A5827
2023-2024: A1812
2025-2026: A2465

2015-S7065A - Summary

Requires long term care insurance carriers who propose to raise long term care insurance premiums to obtain prior approval of the superintendent of financial services.

2015-S7065A - Sponsor Memo

                                 BILL NUMBER:  S7065A

 TITLE OF BILL :

An act to amend the insurance law, in relation to requiring long term
care insurance carriers who propose to raise long term care insurance
premiums to obtain prior approval of the superintendent of financial
services

 PURPOSE OR GENERAL IDEA OF BILL :

The purpose of this legislation is to establish a process and
timeframe for the Department of Financial Services to provide public
notice and notice to policy holders prior to approval of changes to
long term care (LTC) insurance premiums. In addition, the bill
requires the Department of Financial Services to approve such changes
prior to implementation. This bill addresses a serious problem that
has occurred when long term care insurance providers increase rates
without any consumer notice or opportunity to challenge, and when such
increases are not in the best interests of policy holders.

 SUMMARY OF SPECIFIC PROVISIONS :

Section 1 of the bill amends section 1117 of the insurance law by
adding a new subsection (h). The added subsection (h) requires an
insurer desiring to increase or decrease premiums for a long term care

insurance policy to submit a rate filing or application to the
superintendent of financial services and send written notice of the
proposed rate adjustment to each policy and certificate holder
affected by the adjustment. The superintendent is required to post a
copy of the notice on the department's website immediately. Within 30
days from the date that the filing or application is submitted, those
affected by the adjustment can contact the department of financial
services or the insurer to receive additional information or may
submit written comments. The superintendent is required to establish a
process to post all relevant written comments received pertaining to
rate filings or applications on the department's website in a timely
manner. The superintendent shall determine whether the filing or
application will be approved as filed or modified or disapproved.  If
the superintendent finds that the premiums are unreasonable,
excessive, inadequate, or unfairly discriminatory, the superintendent
may modify or disapprove the filing or application. The
superintendent's determination must be rendered in writing between
30-60 days from the date the filing or application is submitted and
must be supported by sound actuarial assumptions and methods. If the
superintendent needs additional information from the insurer in order
to make a determination, the superintendent is authorized to require
the insurer to furnish such information, and the 60 day timeframe will
be tolled and will resume as of the date the requested information is
received. If the superintendent does not render a decision within the
time allotted under this section, the filing or application will be
deemed approved. After an insurer's filing or application is deemed
approved, the insurer must provide at least 60 days advance written
notice of the premium rate adjustment to each affected policy holder
and certificate holder before such rate adjustment is implemented.

Section 2 provides the effective date.

 JUSTIFICATION :

Long term care insurance helps cover the cost of care and daily
activities that people may need as they age. Medicare generally does
not pay for long term care, and therefore many people sign up for long
term care insurance assuming they will not have to pay for such
expenses out of pocket later in life.

Many residents with long term care insurance policies have complained
about the sudden rise in the costs of their insurance premiums.
Recently, many consumers have seen their premiums increase at rates as
high as 60%. Under current law, long term care insurance providers in
New York State are not required to receive prior approval from the
state Department of Financial Services before increasing or decreasing
premiums nor are insurers required to notify policy holders of such
rate changes. The rising premium rates and lack of notification are
problematic for consumers, especially for those who purchased policies
with the understanding that their premiums would not change, as well
as for those who did not receive prior notice of the premium
increases.

According to the National Association of Insurance Commissioners, over
half of the states in the country have laws or regulations which
require long term care insurance providers to submit notification or
approval to the Director or Commissioner of their state's Insurance
Department of a proposed premium rate schedule increase or decrease.
Many of these states also require providers to notify policy holders
of such proposed rate change. New York State is one of 14 states
nationwide without these consumer-protection and prior approval
provisions.

This legislation will safeguard long term care insurance consumers
from being hit with unjustified and unexpected increased premiums by
requiring insurers to submit an application to DFS justifying the
proposed premium increase, notifying policy holders and requiring DFS
approval of such requests.

 FISCAL IMPLICATIONS :

To be determined.

 EFFECTIVE DATE :
This bill shall take effect immediately.

2015-S7065A - Bill Text download pdf

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

                                 7065--A

                            I N  S E N A T E

                             March 22, 2016
                               ___________

Introduced  by  Sen. KRUEGER -- read twice and ordered printed, and when
  printed to be committed to the Committee  on  Insurance  --  committee
  discharged, bill amended, ordered reprinted as amended and recommitted
  to said committee

AN  ACT  to  amend the insurance law, in relation to requiring long term
  care insurance carriers who propose to raise long term care  insurance
  premiums  to  obtain prior approval of the superintendent of financial
  services

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

  Section  1.  Section  1117 of the insurance law is amended by adding a
new subsection (h) to read as follows:
  (H) AN INSURER DESIRING TO INCREASE OR DECREASE PREMIUMS FOR ANY POLI-
CY SUBJECT TO THIS SECTION SHALL SUBMIT A RATE FILING OR APPLICATION  TO
THE  SUPERINTENDENT.    AN  INSURER  SHALL  SEND  WRITTEN  NOTICE OF THE
PROPOSED RATE ADJUSTMENT, INCLUDING THE SPECIFIC  CHANGE  REQUESTED,  TO
EACH  POLICY HOLDER AND CERTIFICATE HOLDER AFFECTED BY THE ADJUSTMENT ON
OR BEFORE THE DATE THE RATE FILING OR APPLICATION IS  SUBMITTED  TO  THE
SUPERINTENDENT. THE NOTICE SHALL PROMINENTLY INCLUDE MAILING AND WEBSITE
ADDRESSES  FOR BOTH THE DEPARTMENT OF FINANCIAL SERVICES AND THE INSURER
THROUGH WHICH A PERSON MAY, WITHIN THIRTY DAYS FROM THE  DATE  THE  RATE
FILING  OR  APPLICATION  IS SUBMITTED TO THE SUPERINTENDENT, CONTACT THE
DEPARTMENT OF FINANCIAL SERVICES OR INSURER TO RECEIVE ADDITIONAL INFOR-
MATION OR TO SUBMIT WRITTEN COMMENTS  TO  THE  DEPARTMENT  OF  FINANCIAL
SERVICES  ON  THE  RATE  FILING OR APPLICATION. THE SUPERINTENDENT SHALL
ESTABLISH A PROCESS TO POST ON SUCH DEPARTMENT'S WEBSITE,  IN  A  TIMELY
MANNER,  ALL  RELEVANT  WRITTEN  COMMENTS  RECEIVED  PERTAINING  TO RATE
FILINGS OR APPLICATIONS. THE INSURER SHALL PROVIDE A COPY OF THE  NOTICE
TO  THE  SUPERINTENDENT  WITH THE RATE FILING OR APPLICATION. THE SUPER-
INTENDENT SHALL IMMEDIATELY CAUSE THE NOTICE TO BE POSTED ON THE DEPART-
MENT OF FINANCIAL SERVICES' WEBSITE. THE SUPERINTENDENT SHALL  DETERMINE
WHETHER THE FILING OR APPLICATION SHALL BECOME EFFECTIVE AS FILED, SHALL
BECOME  EFFECTIVE  AS MODIFIED, OR SHALL BE DISAPPROVED. THE SUPERINTEN-
DENT MAY MODIFY OR DISAPPROVE THE RATE  FILING  OR  APPLICATION  IF  THE

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

                                                           LBD14483-04-6

S. 7065--A                          2

SUPERINTENDENT  FINDS  THAT  THE  PREMIUMS  ARE UNREASONABLE, EXCESSIVE,
INADEQUATE, OR UNFAIRLY DISCRIMINATORY, AND MAY CONSIDER  THE  FINANCIAL
CONDITION  OF  THE INSURER WHEN APPROVING, MODIFYING OR DISAPPROVING ANY
PREMIUM  ADJUSTMENT.  THE  DETERMINATION  OF THE SUPERINTENDENT SHALL BE
SUPPORTED BY SOUND ACTUARIAL  ASSUMPTIONS  AND  METHODS,  AND  SHALL  BE
RENDERED IN WRITING BETWEEN THIRTY AND SIXTY DAYS FROM THE DATE THE RATE
FILING  OR  APPLICATION  IS  SUBMITTED TO THE SUPERINTENDENT. SHOULD THE
SUPERINTENDENT REQUIRE ADDITIONAL INFORMATION FROM THE INSURER IN  ORDER
TO MAKE A DETERMINATION, THE SUPERINTENDENT SHALL REQUIRE THE INSURER TO
FURNISH  SUCH  INFORMATION,  AND  IN SUCH EVENT, THE SIXTY DAYS SHALL BE
TOLLED AND SHALL RESUME AS OF THE DATE THE INSURER FURNISHES THE  INFOR-
MATION  TO THE SUPERINTENDENT. IF THE SUPERINTENDENT REQUESTS ADDITIONAL
INFORMATION LESS THAN TEN DAYS FROM THE EXPIRATION  OF  THE  SIXTY  DAYS
(EXCLUSIVE  OF  TOLLING),  THE  SUPERINTENDENT  MAY EXTEND THE SIXTY DAY
PERIOD AN ADDITIONAL TWENTY DAYS TO MAKE A DETERMINATION.  THE  APPLICA-
TION  OR  RATE  FILING WILL BE DEEMED APPROVED IF A DETERMINATION IS NOT
RENDERED WITHIN THE TIME ALLOTTED UNDER THIS SECTION. AN  INSURER  SHALL
NOT  IMPLEMENT  A  RATE  ADJUSTMENT UNLESS THE INSURER PROVIDES AT LEAST
SIXTY DAYS  ADVANCE  WRITTEN  NOTICE  OF  THE  PREMIUM  RATE  ADJUSTMENT
APPROVED  BY  THE  SUPERINTENDENT  TO EACH POLICY HOLDER AND CERTIFICATE
HOLDER AFFECTED BY THE RATE ADJUSTMENT.
  S 2. This act shall take effect immediately.

2015-S7065B (ACTIVE) - Details

See Assembly Version of this Bill:: A9683
Current Committee:: Senate Insurance
Law Section:: Insurance Law
Laws Affected:: Amd §1117, Ins L
Versions Introduced in Other Legislative Sessions:: 2017-2018: S3389, A2055
2019-2020: S6674, A2941
2021-2022: S19, A5827
2023-2024: A1812
2025-2026: A2465

2015-S7065B (ACTIVE) - Summary

Requires long term care insurance carriers who propose to raise long term care insurance premiums to obtain prior approval of the superintendent of financial services.

2015-S7065B (ACTIVE) - Sponsor Memo

                                 BILL NUMBER:  S7065B

 TITLE OF BILL :  An act to amend the insurance law, in relation to
requiring long term care insurance carriers who propose to raise long
term care insurance premiums to obtain prior approval of the
superintendent of financial services

 PURPOSE OR GENERAL IDEA OF BILL :

The purpose of this legislation is to establish a process and
timeframe for the Department of Financial Services to provide public
notice and notice to policy holders prior to approval of changes to
long term care (LTC) insurance premiums. In addition, the bill
requires the Department of Financial Services to approve such changes
prior to implementation. This bill addresses a serious problem that
has occurred when long term care insurance providers increase rates
without any consumer notice or opportunity to challenge, and when such
increases are not in the best interests of policy holders.

 SUMMARY OF SPECIFIC PROVISIONS :

Section 1 of the bill amends paragraph 3 of subsection (f) of section
1117 of the insurance law which relates to premium rates for long term
care plans.

Section 2 of the bill amends section 1117 of the insurance law by

adding a new subsection (h). The added subsection (h) requires an
insurer desiring to increase or decrease premiums for a long term care
insurance policy to submit a rate filing or application to the
superintendent of financial services and send written notice of the
proposed rate adjustment to each policy and certificate holder
affected by the adjustment. The superintendent is required to post a
copy of the notice on the department's website immediately. Within 30
days from the date that the filing or application is submitted, those
affected by the adjustment can contact the department of financial
services or the insurer to receive additional information or may
submit written comments. The superintendent is required to establish a
process to post all relevant written comments received pertaining to
rate filings or applications on the department's website in a timely
manner. The superintendent shall determine whether the filing or
application will be approved as filed or modified or disapproved.  If
the superintendent finds that the premiums are unreasonable,
excessive, inadequate, or unfairly discriminatory, the superintendent
may modify or disapprove the filing or application. The
superintendent's determination must be rendered in writing between
30-60 days from the date the filing or application is submitted and
must be supported by sound actuarial assumptions and methods. If the
superintendent needs additional information from the insurer in order
to make a determination, the superintendent is authorized to require
the insurer to furnish such information, and the 60 day timeframe will
be tolled and will resume as of the date the requested information is
received.  If the superintendent does not render a decision within the
time allotted under this section, the filing or application will be
deemed approved. After an insurer's filing or application is deemed
approved, the insurer must provide at least 60 days advance written
notice of the premium rate adjustment to each affected policy holder
and certificate holder before such rate adjustment is implemented.

Section 3 provides the effective date.

 JUSTIFICATION :

Long term care insurance helps cover the cost of care and daily
activities that people may need as they age. Medicare generally does
not pay for long term care, and therefore many people sign up for long

term care insurance assuming they will not have to pay for such
expenses out of pocket later in life.

Many residents with long term care insurance policies have complained
about the sudden rise in the costs of their insurance premiums.
Recently, many consumers have seen their premiums increase at rates as
high as 60%. Under current law, long term care insurance providers in
New York State are not required to receive prior approval from the
state Department of Financial Services before increasing or decreasing
premiums nor are insurers required to notify policy holders of such
rate changes. The rising premium rates and lack of notification are
problematic for consumers, especially for those who purchased policies
with the understanding that their premiums would not change, as well
as for those who did not receive prior notice of the premium
increases.

According to the National Association of Insurance Commissioners, over
half of the states in the country have laws or regulations which
require long term care insurance providers to submit notification or
approval to the Director or Commissioner of their state's Insurance
Department of a proposed premium rate schedule increase or decrease.
Many of these states also require providers to notify policy holders
of such proposed rate change. New York State is one of 14 states
nationwide without these consumer-protection and prior approval
provisions.

This legislation will safeguard long term care insurance consumers
from being hit with unjustified and unexpected increased premiums by
requiring insurers to submit an application to DFS justifying the
proposed premium increase, notifying policy holders and requiring DFS
approval of such requests.

 PRIOR LEGISLATIVE HISTORY :

New Bill

 FISCAL IMPLICATIONS :

To be determined.

 EFFECTIVE DATE :
This bill shall take effect immediately.

2015-S7065B (ACTIVE) - Bill Text download pdf

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

                                 7065--B

                            I N  S E N A T E

                             March 22, 2016
                               ___________

Introduced  by  Sen. KRUEGER -- read twice and ordered printed, and when
  printed to be committed to the Committee  on  Insurance  --  committee
  discharged, bill amended, ordered reprinted as amended and recommitted
  to  said  committee  --  committee  discharged,  bill amended, ordered
  reprinted as amended and recommitted to said committee

AN ACT to amend the insurance law, in relation to  requiring  long  term
  care  insurance carriers who propose to raise long term care insurance
  premiums to obtain prior approval of the superintendent  of  financial
  services

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

  Section 1. Paragraph 3 of subsection (f) of section 1117 of the insur-
ance law, as added by chapter 245 of the laws of  1986,  is  amended  to
read as follows:
  (3)  the  premium  rates  for  the  long term care plan are reasonably
related to the benefits provided, and are self-supporting, AS DETERMINED
BY THE SUPERINTENDENT PURSUANT TO SUBSECTION (H) OF THIS SECTION; and
  S 2.  Section 1117 of the insurance law is amended  by  adding  a  new
subsection (h) to read as follows:
  (H) AN INSURER DESIRING TO INCREASE OR DECREASE PREMIUMS FOR ANY POLI-
CY  SUBJECT TO THIS SECTION SHALL SUBMIT A RATE FILING OR APPLICATION TO
THE SUPERINTENDENT.   AN  INSURER  SHALL  SEND  WRITTEN  NOTICE  OF  THE
PROPOSED  RATE  ADJUSTMENT,  INCLUDING THE SPECIFIC CHANGE REQUESTED, TO
EACH POLICY HOLDER AND CERTIFICATE HOLDER AFFECTED BY THE ADJUSTMENT  ON
OR  BEFORE  THE  DATE THE RATE FILING OR APPLICATION IS SUBMITTED TO THE
SUPERINTENDENT. THE NOTICE SHALL PROMINENTLY INCLUDE MAILING AND WEBSITE
ADDRESSES FOR BOTH THE DEPARTMENT OF FINANCIAL SERVICES AND THE  INSURER
THROUGH  WHICH  A  PERSON MAY, WITHIN THIRTY DAYS FROM THE DATE THE RATE
FILING OR APPLICATION IS SUBMITTED TO THE  SUPERINTENDENT,  CONTACT  THE
DEPARTMENT OF FINANCIAL SERVICES OR INSURER TO RECEIVE ADDITIONAL INFOR-
MATION  OR  TO  SUBMIT  WRITTEN  COMMENTS TO THE DEPARTMENT OF FINANCIAL
SERVICES ON THE RATE FILING OR  APPLICATION.  THE  SUPERINTENDENT  SHALL
ESTABLISH  A  PROCESS  TO POST ON SUCH DEPARTMENT'S WEBSITE, IN A TIMELY
MANNER, ALL  RELEVANT  WRITTEN  COMMENTS  RECEIVED  PERTAINING  TO  RATE

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

                                                           LBD14483-06-6

S. 7065--B                          2

FILINGS  OR APPLICATIONS. THE INSURER SHALL PROVIDE A COPY OF THE NOTICE
TO THE SUPERINTENDENT WITH THE RATE FILING OR  APPLICATION.  THE  SUPER-
INTENDENT SHALL IMMEDIATELY CAUSE THE NOTICE TO BE POSTED ON THE DEPART-
MENT  OF FINANCIAL SERVICES' WEBSITE. THE SUPERINTENDENT SHALL DETERMINE
WHETHER THE FILING OR APPLICATION SHALL BECOME EFFECTIVE AS FILED, SHALL
BECOME EFFECTIVE AS MODIFIED, OR SHALL BE DISAPPROVED.  THE  SUPERINTEN-
DENT  MAY  MODIFY  OR  DISAPPROVE  THE RATE FILING OR APPLICATION IF THE
SUPERINTENDENT FINDS THAT  THE  PREMIUMS  ARE  UNREASONABLE,  EXCESSIVE,
INADEQUATE,  OR  UNFAIRLY DISCRIMINATORY, AND MAY CONSIDER THE FINANCIAL
CONDITION OF THE INSURER WHEN APPROVING, MODIFYING OR  DISAPPROVING  ANY
PREMIUM  ADJUSTMENT.  THE  DETERMINATION  OF THE SUPERINTENDENT SHALL BE
SUPPORTED BY SOUND ACTUARIAL  ASSUMPTIONS  AND  METHODS,  AND  SHALL  BE
RENDERED IN WRITING BETWEEN THIRTY AND SIXTY DAYS FROM THE DATE THE RATE
FILING  OR  APPLICATION  IS  SUBMITTED TO THE SUPERINTENDENT. SHOULD THE
SUPERINTENDENT REQUIRE ADDITIONAL INFORMATION FROM THE INSURER IN  ORDER
TO MAKE A DETERMINATION, THE SUPERINTENDENT SHALL REQUIRE THE INSURER TO
FURNISH  SUCH  INFORMATION,  AND  IN SUCH EVENT, THE SIXTY DAYS SHALL BE
TOLLED AND SHALL RESUME AS OF THE DATE THE INSURER FURNISHES THE  INFOR-
MATION  TO THE SUPERINTENDENT. IF THE SUPERINTENDENT REQUESTS ADDITIONAL
INFORMATION LESS THAN TEN DAYS FROM THE EXPIRATION  OF  THE  SIXTY  DAYS
(EXCLUSIVE  OF  TOLLING),  THE  SUPERINTENDENT  MAY EXTEND THE SIXTY DAY
PERIOD AN ADDITIONAL TWENTY DAYS TO MAKE A DETERMINATION.  THE  APPLICA-
TION  OR  RATE  FILING WILL BE DEEMED APPROVED IF A DETERMINATION IS NOT
RENDERED WITHIN THE TIME ALLOTTED UNDER THIS SECTION. AN  INSURER  SHALL
NOT  IMPLEMENT  A  RATE  ADJUSTMENT UNLESS THE INSURER PROVIDES AT LEAST
SIXTY DAYS  ADVANCE  WRITTEN  NOTICE  OF  THE  PREMIUM  RATE  ADJUSTMENT
APPROVED  BY  THE  SUPERINTENDENT  TO EACH POLICY HOLDER AND CERTIFICATE
HOLDER AFFECTED BY THE RATE ADJUSTMENT.
  S 3. This act shall take effect immediately.

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Sponsored By

Liz Krueger

Archive: Last Bill Status - In Senate Committee Insurance Committee

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