BILL NUMBER: S3613

SPONSOR: BRESLIN
 
TITLE OF BILL:

An act to amend chapter 589 of the laws of 2015, amending the insurance
law relating to catastrophic or reinsurance coverage issued to certain
small groups, in relation to the effectiveness thereof; and to amend
chapter 588 of the laws of 2015, amending the insurance law relating to
catastrophic or reinsurance coverage issued to certain small groups, in
relation to the effectiveness thereof

 
PURPOSE:

To extend for two additional years provisions of law relating to
catastrophic or reinsurance coverage issued to certain small groups.

 
SUMMARY OF PROVISIONS:

Section 1. Section 5 of chapter 589 of the laws of 2015, amending the
insurance law relating to catastrophic or reinsurance coverage issued to
certain small groups, as amended by chapter 588-of the laws of 2019 is
              

amended to extend the provisions for three years (2025).

Section 2. Section 5 of chapter 588 of the laws of 2015, amending the
insurance law relating to catastrophic' or reinsurance coverage issued
to certain small groups, as amended by chapter 202 of the laws of 2019
is amended to extend the provisions for three years (2025).

 
JUSTIFICATION:

Prior to the passage of the Affordable Care Act (ACA), New York State
and federal law allowed employers with fifty or more eligible individ-
uals to join together in various forms to purchase experience rated
health insurance coverage for their employees and participate in Health
Insurance Consortiums or Trusts. Upon passage of the ACA, each state was
required, for a time to redefine a "small group employer" to 1-100 from
the current definition of 1-50. In 2015, New York State changed its
definition of a 'small group employer' to mean one to one hundred
employees. Accordingly, the law, among other restrictions, would result
in any employer falling below the one hundred employee threshold to no
longer have the ability to participate in an experience rated health
insurance plan and instead must participate in a community rated plan,
thereby forcing them out of their consortium or trusts.

It is estimated that at least 100 school districts have between 51-100
members. If these districts were forced out of their health care consor-
tiums they would have to go to the small group market which would
significantly increase their health care costs. Not only would the
districts with 51-100 members impacted, but so would all those remaining
in their consortiums because there would be few members in their consor-
tium and less buying power. Moreover, many of these small districts have
many retirees on their health insurance plans who are not counted in the
employee count but would also enter the community rated market. Because
of the significant financial and operational impact this change would
cause for affected districts, several laws have been enacted that have
allowed districts to remain in their health care consortiums on a tempo-
rary basis.

 
LEGISLATIVE HISTORY:

2015 -Chapter 588 & 589

2016 - Chapter 12

2017 - Chapter 370

2018 - Chapter 457

2019 - Chapter 202

2020 - Chapter 58

2021 - Chapter 406

 
FISCAL IMPLICATIONS:

To be determined

 
EFFECTIVE DATE:
This act shall take effect immediately