S T A T E O F N E W Y O R K
________________________________________________________________________
8772
I N S E N A T E
January 8, 2026
___________
Introduced by Sen. BAILEY -- read twice and ordered printed, and when
printed to be committed to the Committee on Rules
AN ACT to amend the insurance law, in relation to high deductible health
plans and health savings accounts; and to amend a chapter of the laws
of 2025 amending the insurance law relating to high deductible health
plans and health savings accounts, as proposed in legislative bills
numbers S. 6895-A and A. 5367-A, in relation to the effectiveness
thereof
THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:
Section 1. Subsection (n) of section 3216 of the insurance law, as
added by a chapter of the laws of 2025 amending the insurance law relat-
ing to high deductible health plans and health savings accounts, as
proposed in legislative bills numbers S. 6895-A and A. 5367-A, is
amended to read as follows:
(n) With respect to high deductible health plans offered in conjunc-
tion with a [health reimbursement account or a] health savings account,
if application of any cost sharing requirements would result in health
savings account ineligibility under section two hundred twenty-three of
the internal revenue code, such [cost sharing requirement shall apply
for health savings account-qualified high deductible health plans with
respect to the deductible of such a plan, only after the enrollee has
satisfied the minimum deductible under section two hundred twenty-three
of the internal revenue code, except with respect to items or services
that are considered preventive care pursuant to subparagraph (C) of
paragraph two of subsection c of section two hundred twenty-three of the
internal revenue code, in which case the cost-sharing requirements of
this section shall apply regardless of whether the minimum deductible
required under section two hundred twenty-three of the internal revenue
code has been satisfied] COVERAGE MAY BE SUBJECT TO THE PLAN'S ANNUAL
DEDUCTIBLE.
§ 2. Subparagraph (B) of paragraph 11 of subsection (i) of section
3216 of the insurance law, as amended by chapter 424 of the laws of
2024, is amended to read as follows:
EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD07833-06-6
S. 8772 2
(B) Such coverage required pursuant to subparagraph (A) or (C) of this
paragraph shall not be subject to annual deductibles or coinsurance. If
under federal law, application of this requirement would result in
health savings account ineligibility under 26 USC 223, this requirement
shall apply for health savings account-qualified high deductible health
plans with respect to the deductible of such a plan after the enrollee
has satisfied the [minimum] PLAN deductible [under 26 USC 223], except
for with respect to items or services that are preventive care pursuant
to 26 USC 223(c)(2)(C), in which case the requirements of this paragraph
shall apply regardless of whether the [minimum] PLAN deductible [under
26 USC 223] has been satisfied.
§ 3. Paragraph 37 of subsection (i) of section 3216 of the insurance
law, as amended by chapter 117 of the laws of 2023, is amended to read
as follows:
(37) Any policy that provides coverage for prescription drugs shall
apply any third-party payments, financial assistance, discount, voucher
or other price reduction instrument for out-of-pocket expenses made on
behalf of an insured individual for the cost of a prescription drug to
the insured's deductible, copayment, coinsurance, out-of-pocket maximum,
or any other cost-sharing requirement when calculating such insured
individual's overall contribution to any out-of-pocket maximum or any
cost-sharing requirement. If under federal law, application of this
requirement would result in health savings account ineligibility under
26 USC 223, this requirement shall apply for health savings account-qua-
lified high deductible health plans with respect to the deductible of
such a plan after the enrollee has satisfied the [minimum] PLAN deduct-
ible [under 26 USC 223], except for with respect to items or services
that are preventive care pursuant to 26 USC 223(c)(2)(C), in which case
the requirements of this paragraph shall apply regardless of whether the
[minimum] PLAN deductible [under 26 USC 223] has been satisfied. This
paragraph only applies to a prescription drug that is either (A) a
brand-name drug without an AB rated generic equivalent, as determined by
the United States Food and Drug Administration; or (B) a brand-name drug
with an AB rated generic equivalent, as determined by the United States
Food and Drug Administration, and the insured has access to the brand-
name drug through prior authorization by the insurer or through the
insurer's appeal process, including any step-therapy process; or (C) a
generic drug the insurer will cover, with or without prior authorization
or an appeal process.
§ 4. Subsection (v) of section 3221 of the insurance law, as added by
a chapter of the laws of 2025 amending the insurance law relating to
high deductible health plans and health savings accounts, as proposed in
legislative bills numbers S. 6895-A and A. 5367-A, is amended to read as
follows:
(v) With respect to high deductible health plans offered in conjunc-
tion with a [health reimbursement account or a] health savings account,
if application of any cost sharing requirements would result in health
savings account ineligibility under section two hundred twenty-three of
the internal revenue code, such [cost sharing requirement shall apply
for health savings account-qualified high deductible health plans with
respect to the deductible of such a plan, only after the enrollee has
satisfied the minimum deductible under section two hundred twenty-three
of the internal revenue code, except with respect to items or services
that are considered preventive care pursuant to subparagraph (C) of
paragraph two of subsection c of section two hundred twenty-three of the
internal revenue code, in which case the cost-sharing requirements of
S. 8772 3
this section shall apply regardless of whether the minimum deductible
required under section two hundred twenty-three of the internal revenue
code has been satisfied] COVERAGE MAY BE SUBJECT TO THE PLAN'S ANNUAL
DEDUCTIBLE.
§ 5. Subparagraph (B) of paragraph 11 of subsection (l) of section
3221 of the insurance law, as amended by chapter 424 of the laws of
2024, is amended to read as follows:
(B) Such coverage required pursuant to subparagraph (A) or (C) of this
paragraph shall not be subject to annual deductibles or coinsurance. If
under federal law, application of this requirement would result in
health savings account ineligibility under 26 USC 223, this requirement
shall apply for health savings account-qualified high deductible health
plans with respect to the deductible of such a plan after the enrollee
has satisfied the [minimum] PLAN deductible [under 26 USC 223], except
for with respect to items or services that are preventive care pursuant
to 26 USC 223(c)(2)(C), in which case the requirements of this paragraph
shall apply regardless of whether the [minimum] PLAN deductible [under
26 USC 223] has been satisfied.
§ 6. Paragraph 21 of subsection (l) of section 3221 of the insurance
law, as amended by chapter 117 of the laws of 2023, is amended to read
as follows:
(21) Every group or blanket policy delivered or issued for delivery in
this state that provides coverage for a prescription drug shall apply
any third-party payments, financial assistance, discount, voucher or
other price reduction instrument for out-of-pocket expenses made on
behalf of an insured individual for the cost of prescription drugs to
the insured's deductible, copayment, coinsurance, out-of-pocket maximum,
or any other cost-sharing requirement when calculating such insured
individual's overall contribution to any out-of-pocket maximum or any
cost-sharing requirement. If under federal law, application of this
requirement would result in health savings account ineligibility under
26 USC 223, this requirement shall apply for health savings account-qua-
lified high deductible health plans with respect to the deductible of
such a plan after the enrollee has satisfied the [minimum] PLAN deduct-
ible [under 26 USC 223], except for with respect to items or services
that are preventive care pursuant to 26 USC 223(c)(2)(C), in which case
the requirements of this paragraph shall apply regardless of whether the
[minimum] PLAN deductible [under 26 USC 223] has been satisfied. This
paragraph only applies to a prescription drug that is either (A) a
brand-name drug without an AB rated generic equivalent, as determined by
the United States Food and Drug Administration; or (B) a brand-name drug
with an AB rated generic equivalent, as determined by the United States
Food and Drug Administration, and the insured has access to the brand-
name drug through prior authorization by the insurer or through the
insurer's appeal process, including any step-therapy process; or (C) a
generic drug the insurer will cover, with or without prior authorization
or an appeal process.
§ 7. Subsection (ww) of section 4303 of the insurance law, as added by
a chapter of the laws of 2025 amending the insurance law relating to
high deductible health plans and health savings accounts, as proposed in
legislative bills numbers S. 6895-A and A. 5367-A, is amended to read as
follows:
[(ww)] (XX) With respect to high deductible health plans offered in
conjunction with a [health reimbursement account or a] health savings
account, if application of any cost sharing requirements would result in
health savings account ineligibility under section two hundred twenty-
S. 8772 4
three of the internal revenue code, such [cost sharing requirement shall
apply for health savings account-qualified high deductible health plans
with respect to the deductible of such a plan, only after the enrollee
has satisfied the minimum deductible under section two hundred twenty-
three of the internal revenue code, except with respect to items or
services that are considered preventive care pursuant to subparagraph
(C) of paragraph two of subsection c of section two hundred twenty-three
of the internal revenue code, in which case the cost-sharing require-
ments of this section shall apply regardless of whether the minimum
deductible required under section two hundred twenty-three of the inter-
nal revenue code has been satisfied] COVERAGE MAY BE SUBJECT TO THE
PLAN'S ANNUAL DEDUCTIBLE.
§ 8. Subparagraph (F) of paragraph 1 of subsection (p) of section 4303
of the insurance law, as amended by chapter 424 of the laws of 2024, is
amended to read as follows:
(F) The coverage required in this paragraph or paragraph two of this
subsection shall not be subject to annual deductibles or coinsurance. If
under federal law, application of this requirement would result in
health savings account ineligibility under 26 USC 223, this requirement
shall apply for health savings account-qualified high deductible health
plans with respect to the deductible of such a plan after the enrollee
has satisfied the [minimum] PLAN deductible [under 26 USC 223], except
for with respect to items or services that are preventive care pursuant
to 26 USC 223(c)(2)(C), in which case the requirements of this paragraph
shall apply regardless of whether the [minimum] PLAN deductible [under
26 USC 223] has been satisfied.
§ 9. Subsection (tt) of section 4303 of the insurance law, as amended
by chapter 117 of the laws of 2023, is amended to read as follows:
(tt) Every contract issued by a medical expense indemnity corporation,
hospital service corporation, or health service corporation that
provides coverage for a prescription drug shall apply any third-party
payments, financial assistance, discount, voucher or other price
reduction instrument for out-of-pocket expenses made on behalf of an
insured individual for the cost of prescription drugs to the insured's
deductible, copayment, coinsurance, out-of-pocket maximum, or any other
cost-sharing requirement when calculating such insured individual's
overall contribution to any out-of-pocket maximum or any cost-sharing
requirement. If under federal law, application of this requirement would
result in health savings account ineligibility under 26 USC 223, this
requirement shall apply for health savings account-qualified high deduc-
tible health plans with respect to the deductible of such a plan after
the enrollee has satisfied the [minimum] PLAN deductible [under 26 USC
223], except for with respect to items or services that are preventive
care pursuant to 26 USC 223(c)(2)(C), in which case the requirements of
this paragraph shall apply regardless of whether the [minimum] PLAN
deductible [under 26 USC 223] has been satisfied. This subsection only
applies to a prescription drug that is either (A) a brand-name drug
without an AB rated generic equivalent, as determined by the United
States Food and Drug Administration; or (B) a brand-name drug with an AB
rated generic equivalent, as determined by the United States Food and
Drug Administration, and the insured has access to the brand-name drug
through prior authorization by the insurer or through the insurer's
appeal process, including any step-therapy process; or (C) a generic
drug the insurer will cover, with or without prior authorization or an
appeal process.
S. 8772 5
§ 10. Section 4 of a chapter of the laws of 2025 amending the insur-
ance law relating to high deductible health plans and health savings
accounts, as proposed in legislative bills numbers S. 6895-A and A.
5367-A, is amended to read as follows:
§ 4. This act shall take effect [immediately] JANUARY 1, 2027 AND
APPLY TO ALL POLICIES AND CONTRACTS ISSUED, RENEWED, MODIFIED, ALTERED,
OR AMENDED ON OR AFTER SUCH DATE.
§ 11. This act shall take effect immediately; provided, however,
sections one, two, three, four, five, six, seven, eight, and nine of
this act shall take effect on the same date and in the same manner as a
chapter of the laws of 2025 amending the insurance law relating to high
deductible health plans and health savings accounts, as proposed in
legislative bills numbers S. 6895-A and A. 5367-A, takes effect.
