New York Laws
Article 43 - Non-Profit Medical and Dental Indemnity, or Health and Hospital Service Corporations
4305 - Group Contracts.

(b) Any such contract which provides for the adjustment of the rate of
premium based upon the experience thereunder shall specify the duration
of the period of insurance thereunder; such period shall not exceed
three years, provided, however, that such contract may provide that, in
the absence of one month's prior written notice by either party to the
other, it shall be automatically renewed at the termination of any
period thereunder for a succeeding period of not less than one nor more
than three years' duration. In any case where such contract is for a
period of more than one year, an appropriate additional rate of premium
shall be charged therefor. Any such contract may provide for the
adjustment of the rate of premium based upon the experience thereunder
at the end of the first period of insurance thereunder or at the end of
any subsequent period of insurance thereunder and any such adjustment
may be made retroactive only for the period of insurance immediately
preceding such adjustment.
(c) (1)(A) Any such contract may provide that benefits will be
furnished to a member of a covered group, for the member, the member's
spouse, child or children, or other persons chiefly dependent upon the
member for support and maintenance; provided that:
(i) a contract of hospital, medical, surgical, or prescription drug
expense insurance that provides coverage for children shall provide such
coverage to a married or unmarried child until attainment of age
twenty-six, without regard to financial dependence, residency with the
member, student status, or employment, except a contract that is a
grandfathered health plan may, for plan years beginning before January
first, two thousand fourteen, exclude coverage of an adult child under
age twenty-six who is eligible to enroll in an employer-sponsored health
plan other than a group health plan of a parent. For purposes of this
item, "grandfathered health plan" means coverage provided by a
corporation in which an individual was enrolled on March twenty-third,
two thousand ten for as long as the coverage maintains grandfathered
status in accordance with section 1251(e) of the Affordable Care Act, 42
U.S.C. § 18011(e); and
(ii) a contract under which coverage terminates at a specified age
shall, with respect to an unmarried child who is incapable of
self-sustaining employment by reason of mental illness, developmental
disability, as defined in the mental hygiene law, or physical handicap
and who became so incapable prior to attainment of the age at which
coverage would otherwise terminate and who is chiefly dependent upon
such member for support and maintenance, not so terminate while the
contract remains in force and the child remains in such condition, if
the member has within thirty-one days of such child's attainment of the

termination age submitted proof of such child's incapacity as described
herein.
(B) In addition to the requirements of subparagraph (A) of this
paragraph, every corporation issuing a group contract of hospital,
medical or surgical expense insurance pursuant to this section that
provides coverage for children, must make available and if requested by
the contractholder, extend coverage under that contract to an unmarried
child through age twenty-nine, without regard to financial dependence
who is not insured by or eligible for coverage under any employer health
benefit plan as an employee or member, whether insured or self-insured,
and who lives, works or resides in New York state or the service area of
the corporation. Such coverage shall be made available at the inception
of all new contracts and with respect to all other contracts at any
anniversary date. Written notice of the availability of such coverage
shall be delivered to the contractholder prior to the inception of such
group contract and annually thereafter.
(C) Notwithstanding any rule, regulation or law to the contrary, any
contract under which a member elects coverage for the member, the
member's spouse, children or other persons chiefly dependent upon the
member for support and maintenance shall provide that coverage of
newborn infants, including newly born infants adopted by the member if
such member takes physical custody of the infant upon such infant's
release from the hospital and files a petition pursuant to section one
hundred fifteen-c of the domestic relations law within thirty days of
birth; and provided further that no notice of revocation to the adoption
has been filed pursuant to section one hundred fifteen-b of the domestic
relations law and consent to the adoption has not been revoked, shall be
effective from the moment of birth for injury or sickness including the
necessary care and treatment of medically diagnosed congenital defects
and birth abnormalities including premature birth, except that in cases
of adoption, coverage of the initial hospital stay shall not be required
where a birth parent has insurance coverage available for the infant's
care. This provision regarding coverage of newborn infants shall not
apply to two person coverage. In the case of individual or two person
coverages the corporation must also permit the person to whom the
certificate is issued to elect such coverage of newborn infants from the
moment of birth. If notification and/or payment of an additional premium
or contribution is required to make coverage effective for a newborn
infant, the coverage may provide that such notice and/or payment be made
within no less than thirty days of the day of birth to make coverage
effective from the moment of birth. This election shall not be required
in the case of student insurance or where the group's plan does not
provide coverage for children.
(2) Any such contract under which coverage of a dependent spouse or
group member would terminate upon such spouse or group member attaining
the age prescribed in subchapter XVIII of the Social Security Act, 42
U.S.C. § 1395 et seq. ("Medicare"), as the age of first eligibility for
the benefits provided by such law shall not so terminate, if such
dependent spouse is not then eligible for all of such benefits, for as
long as the contract remains in force and such dependent spouse remains
ineligible to receive any of such "Medicare" benefits, provided proof of
such ineligibility is submitted to the corporation within thirty-one
days of the date notice of termination of coverage is sent by first
class mail by the corporation to the last known address of the
policyholder.
(d) (1) (A) A group contract issued pursuant to this section shall
contain a provision to the effect that in case of a termination of
coverage under such contract of any member of the group because of (i)

termination for any reason whatsoever of the member's employment or
membership, or (ii) termination for any reason whatsoever of the group
contract itself unless the group contract holder has replaced the group
contract with similar and continuous coverage for the same group whether
insured or self-insured, the member shall be entitled to have issued to
the member by the corporation, without evidence of insurability, upon
application therefor and payment of the first premium made to the
corporation within sixty days after termination of the coverage, an
individual direct payment contract, covering such member and the
member's eligible dependents who were covered by the group contract,
which provides coverage that contains the essential health benefits
package described in paragraph three of subsection (e) of section four
thousand three hundred six-h of this article. The corporation shall
offer one contract at each level of coverage as defined in subsection
(b) of section four thousand three hundred six-h of this article. The
member may choose any such contract offered by the corporation.
Provided, however, the superintendent may, after giving due
consideration to the public interest, approve a request made by a
corporation for the corporation to satisfy the requirements of this
subparagraph through the offering of contracts that comply with this
subparagraph by another corporation, insurer or health maintenance
organization within the corporation's same holding company system, as
defined in article fifteen of this chapter.
(B) The conversion privilege afforded in this paragraph shall also be
available: (i) upon the divorce or annulment of the marriage of a
member, to the divorced spouse or former spouse of such member; (ii)
upon the death of the member, to the surviving spouse and other
dependents covered under the contract; and (iii) to a dependent if no
longer within the definition in the contract.
(2) The effective date of the coverage provided by the individual
direct payment contract shall be the date of the termination of the
individual's coverage under the group contract. The corporation shall
not be required to issue such individual direct payment converted
contract covering any person if it appears that such person shall then
be covered by another individual contract providing similar coverage or
if it shall appear that such person is covered by or eligible to be
covered by a group contract or policy providing similar benefits or is
provided with similar benefits required by any statute or provided by
any welfare plan or program, which together with the individual direct
payment converted contract would result in over-insurance or duplication
of benefits according to standards on file with the superintendent of
financial services relating to individual contracts.
(3) (A) Each member in the insured group, but not his dependents,
shall be given written notice of such conversion privilege provided in
paragraph one hereof and its duration within fifteen days after the date
of termination of coverage under the group contract, provided that if
such notice be given more than fifteen days but less than ninety days
after the date of termination of coverage under the group contract the
time allowed for the exercise of such conversion privilege shall be
extended for forty-five days after the giving of such notice. If such
notice is not given within ninety days after the date of termination of
coverage under the group contract the time allowed for the exercise of
such conversion privilege shall expire at the end of such ninety days.
(B) Written notice by the contract holder given to the member or sent
by first class mail to the member at his last known address, or written
notice by the corporation which issued the group contract sent by first
class mail to the member at the last address furnished to the

corporation by the contract holder, shall be deemed full compliance with
the provisions of this paragraph for the giving of notice.
(C) A group contract issued pursuant to this section may contain a
provision to the effect that notice of such conversion privilege and its
duration shall be given by the contract holder to each certificate
holder upon termination of his group coverage.
(4) A group contract to be issued to a social services district
pursuant to section three hundred sixty-five of the social services law
by a corporation subject to the provisions of this article need not,
subject to the approval of the superintendent, provide for the issuance
of individual certificates and may omit or modify any of the other
provisions required to be contained in such contract, provided that the
superintendent deems such omission or modification suitable for the
character of the coverage provided.
(5) For purposes of this subsection, the term "dependent" shall
include a child as described in subsection (c) of this section.
(e) In addition to the conversion privilege afforded by subsection (d)
of this section, a group contract issued by a hospital service, health
service or medical expense indemnity corporation shall provide that if
all or any portion of the insurance on an employee or member insured
under the policy ceases because of termination of employment or
membership in the class or classes eligible for coverage under the
policy, such employee or member shall be entitled without evidence of
insurability upon application to continue his insurance for himself or
herself and his or her eligible dependents, subject to all of the group
contract's terms and conditions applicable to those forms of benefits
and to the following conditions:
(1) Continuation shall cease on the date which the employee, member or
dependant first becomes, after the date of election: (A) entitled to
coverage under title XVIII of the United States Social Security Act
(Medicare) as amended or superseded; or (B) covered as an employee,
member or dependent by any other insured or uninsured arrangement which
provides hospital, surgical or medical coverage for individuals in a
group which does not contain any exclusion or limitation with respect to
any pre-existing condition of such employee, member or dependent.
(2) (A) An employee or member who wishes continuation of coverage must
request such continuation in writing within the sixty day period
following the later of: (i) the date of such termination; or (ii) the
date the employee is sent notice by first class mail of the right of
continuation by the group policyholder.
(B) An employee or member who wishes continuation of coverage under
subparagraph (D) of paragraph four of this subsection must give notice
to the employer or group policyholder within sixty days of the
determination under title II or title XVI of the United States Social
Security Act that such employee or member was disabled at the time of
termination of employment or membership or at any time during the first
sixty days of continuation of coverage.
(3) An employee or member electing continuation must pay to the group
policyholder or his employer, but not more frequently than on a monthly
basis in advance, the amount of the required premium payment, but not
more than one hundred two percent of the group rate for the benefits
being continued under the group contract on the due date of each
payment. The employee's or member's written election of continuation,
together with the first premium payment required to establish premium
payment on a monthly basis in advance, must be given to the policyholder
or employer within sixty days of the date the employee's or member's
benefits would otherwise terminate.
(4) Subject to paragraph one of this subsection, continuation of
benefits under the group contract for any person shall terminate at the
first to occur of the following:
(A) The date thirty-six months after the date the employee's or
member's benefits under the contract would otherwise have terminated
because of termination of employment or membership; or
(B) The end of the period for which premium payments were made, if the
employee or member fails to make timely payment of a required premium
payment; or
(C) In the case of an eligible dependent of an employee or member, the
date thirty-six months after the date such person's benefits under the
contract would otherwise have terminated by reason of:
(i) the death of the employee or member;
(ii) the divorce or legal separation of the employee or member from
his or her spouse;
(iii) the employee or member becoming entitled to benefits under title
XVIII of the United States Social Security Act (Medicare); or
(iv) a dependent child ceasing to be a dependent child under the
generally applicable requirements of the contract; or
(D) The date on which the group contract is terminated or, in the case
of an employee, the date his employer terminated participation under the
group contract. However, if this clause applies and the coverage ceasing
by reason of such termination is replaced by similar coverage under
another group contract, the following shall apply:
(i) The employee or member shall have the right to become covered
under that other group contract, for the balance of the period that he
would have remained covered under the prior group contract in accordance
with this subparagraph had a termination described in this subparagraph
not occurred, and
(ii) The minimum level of benefits to be provided by the other group
contract shall be the applicable level of benefits of the prior group
contract reduced by any benefits payable under the prior group contract,
and
(iii) The prior group contract shall continue to provide benefits to
the extent of its accrued liabilities and extensions of benefits as if
the replacement had not occurred.
(5) A notification of the continuation privilege and the time period
in which to request continuation shall be included in each certificate
of coverage.
(6) The conversion privilege afforded by subsection (d) of this
section shall be available upon termination of the continuation of
benefits described herein.
(7) This subsection shall not be applicable where a continuation
benefit is available to the employee or member pursuant to Chapter 18 of
the Employee Retirement Income Security Act, 29 U.S.C. § 1161 et seq or
Chapter 6A of the Public Health Service Act, 42 U.S.C. § 300 bb - 1 et
seq. However, a group contract shall offer an employee or member who has
exhausted continuation coverage pursuant to Chapter 18 of the Employee
Retirement Income Security Act, 29 U.S.C. § 1161 et seq. or Chapter 6A
of the Public Health Service Act, 42 U.S.C. § 300 bb - 1 et seq. the
opportunity to continue coverage for up to thirty-six months from the
date the employee's or member's continuation coverage began if the
employee or member is entitled to less than thirty-six months of
continuation benefits.
(8)(A) Special enrollment period. An individual who does not have an
election of continuation coverage as described in this subsection in
effect on the effective date of the American Recovery and Reinvestment
act of 2009, but who would be an assistance eligible individual under

Title III of such act if such election were in effect, may elect
continuation coverage pursuant to this subsection. Such election must be
made no later than sixty days after the date the administrator of the
group health plan (or other entity involved) provides the notice
required by section 3001(a)(7) of the American Recovery and Reinvestment
act of 2009. The administrator of the group health plan (or other entity
involved) shall provide such individuals with additional notice of the
right to elect coverage pursuant to this paragraph within sixty days of
the date of enactment of the American Recovery and Reinvestment act of
2009.
(B) Continuation coverage elected pursuant to subparagraph (A) of this
paragraph shall commence with the first period of coverage beginning on
or after the date of the enactment of the American Recovery and
Reinvestment act of 2009 and shall not extend beyond the period of
continuation coverage that would have been required if the coverage had
instead been elected pursuant to paragraph two of this subsection.
(C) With respect to an individual who elects continuation coverage
pursuant to subparagraph (A) of this paragraph, the period beginning on
the date of the qualifying event and ending on the date of the first
period of coverage on or after the enactment of the American Recovery
and Reinvestment act of 2009 shall be disregarded for purposes of
determining the sixty-three day period referred to in section four
thousand three hundred eighteen of this article.
(9) For purposes of this subsection, the term "dependent" shall
include a child as described in subsection (c) of this section.
(f) Any contract and certificate, other than one issued in fulfillment
of the continuing care responsibilities of an operator of a continuing
care retirement community in accordance with article forty-six of the
public health law, made available because of residence in a particular
facility, housing development, or community shall contain the following
notice in twelve point type in bold face on the first page:
"NOTICE - THIS CONTRACT (CERTIFICATE) DOES NOT MEET THE REQUIREMENTS
OF A CONTINUING CARE RETIREMENT CONTRACT. AVAILABILITY OF THIS COVERAGE
WILL NOT QUALIFY A RESIDENTIAL FACILITY AS A CONTINUING CARE RETIREMENT
COMMUNITY."
(g) In addition to all the rights of conversion and continuation
otherwise provided for herein, employees or members insured under the
contract who are also members of a reserve component of the armed forces
of the United States, including the National Guard, shall be entitled to
have supplementary conversion and continuation rights in certain
circumstances as follows:
(1) if the employee or member insured enters upon active duty as
defined in subsection (h) of this section, and the employer or group
contract holder does not voluntarily maintain coverage for such employee
or member insured, the employee or member insured shall be entitled to
have his or her coverage continued under the group contract in
accordance with the conditions and limitations contained in paragraph
seven of this subsection and have issued at the end of the period of
continuation an individual conversion policy subject to the terms of
this subsection. The effective date for the conversion policy shall be
the day following the termination of insurance under the group policy,
or if there is a continuation of coverage, on the day following the end
of the period of continuation.
(2) if the employer or group contract holder does not voluntarily
maintain coverage for the employee or member insured during the period
of active duty, and such employee or member insured does not elect the
supplementary conversion and continuation rights provided for herein,

coverage for such employee or member insured shall be suspended during
the period of active duty.
(3) if the employee or member insured elects the supplementary
continuation right provided for herein or coverage under the group plan
is suspended, and such employee or member insured dies during the period
of active duty, the conversion right provided by this section shall be
available to the surviving spouse and children, and shall be available
to a child solely with respect to himself or herself upon his or her
attaining the limiting age of coverage under the group contract while
covered as a dependent thereunder. It shall also be available upon the
divorce or annulment of the marriage of the employee or member insured,
to the former spouse of such employee or member insured, if such divorce
or annulment occurs during the period of active duty.
(4) if the employee or member insured elects the supplementary
conversion and continuation right provided for herein or coverage under
the group plan is suspended, and such employee or member insured is
either reemployed or restored to participation in the group upon return
to civilian status, he or she shall be entitled to resume participation
in insurance offered by the group pursuant to this section, with no
limitations or conditions imposed as a result of such period of active
duty except as set forth in subparagraphs (A) and (B) herein. The right
of resumption provided for herein shall extend to coverage for the
spouse and dependents of the employee or member insured and shall be in
addition to other existing rights granted pursuant to state and federal
laws and regulations and shall not be deemed to qualify or limit such
rights in any way. No exclusion or waiting period may be imposed in
connection with coverage of a health or physical condition of a person
entitled to such right of resumption, or a health or physical condition
of any other person who is covered by the policy unless:
(A) the condition arose during the period of active duty and the
condition has been determined by the secretary of veterans affairs to be
a condition incurred in the line of duty; or
(B) a waiting period was imposed and had not been completed prior to
the period of suspension; in no event, however, shall the sum of the
waiting periods imposed prior to and subsequent to the period of
suspension exceed the length of the waiting period originally imposed.
(5) if the employee or member insured elects the supplementary
conversion and continuation coverage provided for herein:
(A) when such employee or member insured is either reemployed or
restored to participation in the group, coverage under the supplementary
rights provided for herein shall terminate on the date that coverage is
effective due to resumption of participation in the group.
(B) when such employee or member insured is not reemployed or restored
to participation in the group upon return to civilian status, he or she
shall be entitled to the conversion and continuation rights provided by
subsections (d) and (e) of this section.
(i) To elect an individual conversion contract pursuant to subsection
(d) of this section, the employee or member insured must apply to the
insurer within thirty-one days of the termination of active duty or
discharge from hospitalization incident to such active duty, which
hospitalization continues for a period of not more than one year. Upon
commencement of coverage under the conversion right provided pursuant to
subsection (d) of this section, coverage under the supplementary
continuation right provided for herein shall terminate.
(ii) To elect continuation of coverage pursuant to subsection (e) of
this section, the employee or member insured must request such
continuation of the employer within thirty-one days of the termination
of active duty or discharge from hospitalization incident to such active

duty, which hospitalization continues for a period of not more than one
year. Upon commencement of coverage under the continuation right
provided pursuant to subsection (e) of this section, coverage under the
supplementary continuation right provided for herein shall terminate.
The employee or member insured shall be entitled to have issued at the
end of the period of continuation an individual conversion contract.
(6) if coverage under the group plan is suspended during the period of
active duty:
(A) when the employee or member insured returns to participation in
the group plan, coverage under the group plan shall be retroactive to
the date of termination of the period of active duty.
(B) when such employee or member insured is not reemployed or restored
to participation in the group upon return to civilian status, he or she
shall be entitled to the conversion and continuation rights provided by
subsections (d) and (e) of this section.
(i) To elect an individual conversion contract pursuant to subsection
(d) of this section, the employee or member insured must apply to the
insurer within thirty-one days of the termination of active duty or
discharge from hospitalization incident to such active duty, which
hospitalization continues for a period of not more than one year.
(ii) To elect continuation of coverage pursuant to subsection (e) of
this section, the employee or member insured must request such
continuation of the employer within thirty-one days of the termination
of active duty or discharge from hospitalization incident to such active
duty, which hospitalization continues for a period of not more than one
year. The employee or member insured shall be entitled to have issued at
the end of the period of continuation an individual conversion contract.
(7) A group contract providing hospital, surgical or medical expense
insurance for other than accident only shall provide that if all or any
portion of the insurance on an employee or member insured under the
contract ceases because the employee or member insured is ordered to
active duty as defined in subsection (h) of this section, such employee
or member insured shall be entitled, without evidence of insurability,
upon application to continue his or her hospital, surgical or medical
expense insurance for himself or herself and his or her eligible
dependents, under the supplementary conversion and continuation rights
provided for herein, subject to all of the group policy's terms and
conditions applicable to those forms of benefits and to the following
conditions:
(A) continuation shall cease on the date which the employee, member or
dependant first becomes, after the date of election: (i) entitled to
coverage under title XVIII of the United States Social Security Act
(Medicare) as amended or superseded or (ii) covered as an employee,
member or dependent by any other insured or uninsured arrangement which
provides hospital, surgical or medical coverage for individuals in a
group, except that the coverage available to active duty members of the
uniformed services and their family members shall not be considered a
group under the terms of this subsection and except that the group
insurance contract conversion option of this section shall not be
considered as such an arrangement under which an employee, member or
dependent could become covered.
(B) an employee or member insured who wishes continuation of coverage
pursuant to this subsection must request such continuation in writing
within sixty days of being ordered to active duty.
(C) an employee or member insured electing continuation pursuant to
this subsection must pay to the group contract holder or his or her
employer, but not more frequently than on a monthly basis in advance,
the amount of the required premium payment, but not more than the group

rate for the benefits being continued under the group contract on the
due date of each payment.
(8) The supplementary conversion and continuation rights provided for
herein shall apply to:
(A) contracts not covered by Chapter 18 of the Employee Retirement
Income Security Act, 29 U.S.C. section 1161 et seq or Chapter 6A of the
Public Health Service Act, 42 U.S.C. section 300bb-1 et seq;
(B) contracts covered by Chapter 18 of the Employee Retirement Income
Security Act, 29 U.S.C. section 1161 et seq or Chapter 6A of the Public
Health Service Act, 42 U.S.C. section 300bb-1 et seq, when active duty
for reservists and the refusal of an employer to voluntarily maintain
coverage for such period of active duty is not considered a qualifying
event.
(h) To be entitled to the right defined in subsection (g) of this
section a person must be a member of a reserve component of the armed
forces of the United States, including the National Guard, who either:
(1) voluntarily or involuntarily enters upon active duty (other than
for the purpose of determining his or her physical fitness and other
than for training), or
(2) has his or her active duty voluntarily or involuntarily extended
during a period when the president is authorized to order units of the
ready reserve or members of a reserve component to active duty, provided
that such additional active duty is at the request and for the
convenience of the federal government, and
(3) serves no more than four years of active duty.
(j)(1) Except as provided in this section, if a corporation delivers
or issues for delivery in this state a group or blanket contract which
provides hospital, surgical or medical expense coverage for other than
accident only, the corporation must renew or continue in force such
coverage at the option of the contract holder.
(2) A corporation may nonrenew or discontinue coverage under such a
group or blanket contract based only on one or more of the following:
(A) The contract holder or a participating entity has failed to pay
premiums or contributions in accordance with the terms of the contract
or the corporation has not received timely premium payments.
(B) The contract holder or a participating entity has performed an act
or practice that constitutes fraud or made an intentional
misrepresentation of material fact under the terms of the contract.
(C) The contract holder has failed to comply with a material plan
provision relating to employer contribution or group participation
rules, as permitted under section four thousand two hundred thirty-five
of this chapter.
(D) The corporation is ceasing to offer group or blanket contracts in
a market in accordance with paragraph three or paragraph six of this
subsection.
(E) The contract holder ceases to meet the requirements for a group
under section four thousand two hundred thirty-five of this chapter or a
participating employer, labor union, association or other entity ceases
membership or participation in the group to which the contract is
issued. Coverage terminated pursuant to this paragraph shall be done
uniformly without regard to any health status-related factor relating to
any covered individual.
(F) In the case of a corporation that offers a group or blanket
contract in a market through a network plan, there is no longer any
enrollee in connection with such plan who lives, resides or works in the
operating area of the corporation (or in the area for which the
corporation is authorized to do business).
(G) Such other reasons as are acceptable to the superintendent and
authorized by the Health Insurance Portability and Accountability Act of
1996, Public Law 104-191, and any later amendments or successor
provisions, or by any federal regulations or rules that implement the
provisions of the Act.
(3) (A) In any case in which a corporation decides to discontinue
offering a particular class of group or blanket contract of hospital,
surgical or medical expense insurance offered in the small or large
group market, the contract of such class may be discontinued by the
corporation in accordance with this chapter in such market only if:
(i) the corporation provides written notice to each contract holder
provided coverage of this class in such market (and to all employees and
member insureds covered under such coverage) of such discontinuance at
least ninety days prior to the date of discontinuance of such coverage.
In addition to any other information required of notices by the
superintendent, this written notice shall conspicuously include an
explanation, in plain language, of the contract holder's and covered
employee's or member insured's rights under this subparagraph and
subparagraph (B) of this paragraph, including:
(I) a statement that if the superintendent determines that the covered
employee, member insured, or a dependent has a serious medical
condition, and the covered employee, member insured or dependent within
the previous twelve months utilized a benefit under; the contrary
related to the serious medical condition that is not covered by the
replacement coverage offered to the contract holder as a result of the
discontinuance, then the superintendent shall require the corporation to
offer the contract holder replacement coverage that includes a benefit
that is the same as or substantially similar to the benefit set forth in
the contract that the corporation discontinued; and
(II) an explanation as to how to contact the superintendent, and the
date by which the superintendent shall be contacted, if the contract
holder, covered employee or member insured believes that the covered
employee, member insured or a dependent has a serious medical condition,
and the covered employee, member insured or dependent within the
previous twelve months utilized a benefit related to the serious medical
condition that may not be covered by the replacement coverage offered to
the contract holder as a result of the discontinuance;
(ii) the corporation offers to each contract holder provided coverage
of this class in such market, the option to purchase all (or, in the
case of the large group market, any) other hospital, surgical and
medical expense coverage currently being offered by the corporation to a
group in such market;
(iii) in exercising the option to discontinue coverage of this class
and in offering the option of coverage under item (ii) of this
subparagraph, the corporation acts uniformly without regard to the
claims experience of those contract holders or any health status-related
factor relating to any particular covered employee, member insured or
dependent who may become eligible for such coverage, and the corporation
is not discontinuing the coverage of this class with the intent or as a
pretext to discontinuing the coverage of any such employee, member
insured or dependent; and
(iv) at least ninety days prior to the date of discontinuance of such
coverage, the corporation provides written notice to the superintendent
of such discontinuance, including the reason for the discontinuance, and
an officer or director of the corporation certifies to the
superintendent that the corporation has complied with items (i), (ii)
and (iii) of this paragraph. If such notice does not include the date or
dates that the corporation mailed or delivered the notice to all

contract holders, covered employers and member insureds, the corporation
shall notify the superintendent of such date within seven days of the
completion of the mailing or delivery.
(B) If the superintendent determines that the corporation has not
complied with item (iii) of subparagraph (A) of this paragraph, then the
superintendent may prohibit the corporation from discontinuing the class
of contracts and require the corporation to promptly notify every
contract holder, covered employee and member insured that the
corporation is not discontinuing the contracts. If the superintendent
determines that the corporation wrongfully discontinued the class of
contracts pursuant to item (iii) of subparagraph (A), then the
superintendent shall require that the corporation take remedial action,
including offering to group contract holders the option of reinstating
the discontinued contract forms. If the superintendent determines that
the corporation discontinued the class of contracts without compliance
with items (i), (ii), or (iv) of subparagraph (A), and an employee,
member insured or dependent covered under the discontinued contract
would have been entitled to relief under this paragraph, then the
superintendent may require that the corporation offer replacement
coverage to an affected contract holder consistent with item (ii) of
subparagraph (C) of this paragraph.
(C) (i) If, within forty-five days after the corporation mails or
delivers the written notice of discontinuance required by item (i) of
subparagraph (A) of this paragraph, the superintendent is notified by a
contract holder or covered employee or member insured that a covered
employee, member insured or dependent has a serious medical condition
and that a benefit utilized by the covered employee, member insured or
dependent within the previous twelve months related to the serious
medical condition may not be covered by the replacement coverage offered
to the contract holder as a result of the discontinuance, then the
superintendent shall, within twenty days of the notification, ask the
corporation to confirm that the covered employee, member insured or
dependent utilized a benefit within the previous twelve months to treat
the medical condition that the covered employee, member insured or
dependent asserts is a serious medical condition, and that the benefit
is not covered by the replacement coverage. The superintendent may
request such additional information as the superintendent may require.
The corporation shall provide all requested information to the
superintendent within five days of receipt of the request.
(ii) If, within twenty days of the superintendent's receipt of all
additional information requested from the corporation, the
superintendent determines that (I) the covered employee, member insured
or dependent has a serious medical condition; and (II) the benefit
utilized by the covered employee, member insured or dependent within the
previous twelve months related to the serious medical condition is not
covered by the replacement coverage offered to the contract holder as a
result of the discontinuance, then the superintendent shall require the
corporation to offer to the contract holder replacement coverage that
includes a benefit that is the same as or substantially similar to the
benefit set forth in the contract that the corporation discontinued. If
the replacement coverage is not available, at the time that the contract
would otherwise be discontinued, then the corporation shall keep the
existing policy in force for the affected contract holder until the
replacement coverage with the substantially similar benefit is
available.
(D) The remedies as provided in this paragraph shall be in addition to
and not in lieu of any other authority or power of the superintendent to
impose monetary or other penalties for violations of this paragraph.
(E) In any case in which a corporation elects to discontinue offering
all hospital, surgical and medical expense coverage in the small group
market or the large group market, or both markets, in this state, health
insurance coverage may be discontinued by the corporation only if:
(i) the corporation provides written notice to the superintendent and
to each contract holder (and all employees and member insureds covered
under such coverage) of such discontinuance at least one hundred eighty
days prior to the date of the discontinuance of such coverage;
(ii) all hospital, surgical and medical expense coverage issued or
delivered for issuance in this state in such market or markets is
discontinued and coverage under such contracts in such market or markets
is not renewed; and
(iii) in addition to the notice to the superintendent referred to in
item (i) of this subparagraph, the corporation shall provide the
superintendent with a written plan to minimize potential disruption in
the marketplace occasioned by the corporation's withdrawal from the
market.
(F) In the case of a discontinuance under subparagraph (E) of this
paragraph in a market, the corporation may not provide for the issuance
of any group or blanket contract of hospital, surgical or medical
expense insurance in that market in this state during the five-year
period beginning on the date of the discontinuance of the last health
insurance contract not so renewed.
(4) At the time of coverage renewal, an insurer may modify the health
insurance coverage for a group or blanket contract offered to a large or
small group contract holder so long as such modification is consistent
with this chapter and effective on a uniform basis among all small group
contract holders with that contract.
(5) For purposes of this subsection the term "network plan" shall mean
a health insurance contract under which the financing and delivery of
health care (including items and services paid for as such care) are
provided, in whole or in part, through a defined set of providers under
contract either with the corporation or another entity that has
contracted with the corporation.
(6) Notwithstanding paragraph three of this subsection, a corporation
may discontinue offering a particular class of group or blanket contract
of hospital, surgical or medical expense insurance offered in the small
or large group market, and instead offer a group or blanket contract of
hospital, surgical or medical expense insurance that complies with the
requirements of section 2707 of the public health service act, 42 U.S.C.
§ 300gg-6 that become applicable to such contract as of January first,
two thousand fourteen, provided that the corporation:
(A) discontinues the existing class of contract in such market as of
either December thirty-first, two thousand thirteen or the contract
renewal date occurring in two thousand fourteen in accordance with this
chapter;
(B) provides written notice to each contract holder provided coverage
of the class in the market (and to all employees and member insureds
covered under such coverage) of the discontinuance at least ninety days
prior to the date of discontinuance of such coverage. The written notice
shall be in a form satisfactory to the superintendent;
(C) offers to each contract holder provided coverage of the class in
the market, the option to purchase all (or, in the case of the large
group market, any) other hospital, surgical and medical expense coverage
that complies with the requirements of section 2707 of the public health
service act, 42 U.S.C. § 300gg-6 that become applicable to such coverage
as of January first, two thousand fourteen, currently being offered by
the corporation to a group in that market;
(D) in exercising the option to discontinue coverage of the class and
in offering the option of coverage under subparagraph (C) of this
paragraph, acts uniformly without regard to the claims experience of
those contract holders or any health status-related factor relating to
any particular covered employee, member insured or dependent, or
particular new employee, member insured, or dependent who may become
eligible for such coverage, and does not discontinue the coverage of the
class with the intent or as a pretext to discontinuing the coverage of
any such employee, member insured, or dependent; and
(E) at least one hundred twenty days prior to the date of the
discontinuance of such coverage, provides written notice to the
superintendent of the discontinuance, including certification by an
officer or director of the corporation that the reason for the
discontinuance is to replace the coverage with new coverage that
complies with the requirements of section 2707 of the public health
service act, 42 U.S.C. § 300gg-6 that become effective January first,
two thousand fourteen. The written notice shall be in such form and
contain such information the superintendent requires.
(k)(1) No corporation delivering or issuing for delivery in this state
a group or blanket contract which provides hospital, surgical or medical
expense coverage shall establish rules for eligibility (including
continued eligibility) of any individual or dependent of the individual
to enroll under the contract based on any of the following health
status-related factors:
(A) Health status.
(B) Medical condition (including both physical and mental illnesses).
(C) Claims experience.
(D) Receipt of health care.
(E) Medical history.
(F) Genetic information.
(G) Evidence of insurability (including conditions arising out of acts
of domestic violence).
(H) Disability.
(2) For purposes of paragraph one of this subsection, rules for
eligibility include rules defining any applicable waiting periods for
such enrollment.
(3) No corporation may, on the basis of any health status-related
factor in relation to the subscriber or dependent of the subscriber,
require any subscriber (as a condition of enrollment or continued
enrollment under the contract) to pay a premium or contribution which is
greater than such premium for a similarly situated subscriber enrolled
in the plan.
(4) Nothing in this subsection shall require a corporation to issue a
group or blanket contract to a group comprised of fifty-one or more
lives exclusive of spouses and dependents.
(5) Where an eligible subscriber or dependent of a subscriber rejects
initial enrollment in a group or blanket contract that provides
hospital, surgical or medical expense insurance, a corporation shall
permit a subscriber or dependent of a subscriber to enroll for coverage
under the terms of the contract if each of the following conditions are
met:
(A) The subscriber or dependent was covered under another plan or
contract at the time coverage was initially offered.
(B)(i) Coverage was provided in accordance with continuation required
by federal or state law and was exhausted; or
(ii) Coverage under the other plan or contract was subsequently
terminated as a result of loss of eligibility for one or more of the
following reasons:
(I) termination of employment;
(II) termination of the other plan or contract;
(III) death of the spouse;
(IV) legal separation, divorce or annulment;
(V) reduction in the number of hours of employment; or
(iii) Contract holder contributions toward the payment of premium for
the other plan or contract were terminated.
(C) Coverage must be applied for within thirty days of termination for
one of the reasons set forth in subparagraph (B) of this paragraph.
(6) With respect to group or blanket contracts delivered or issued for
delivery in this state covering between two and fifty employees or
members, the provisions of this subsection shall in no way diminish the
rights of such groups pursuant to section four thousand three hundred
seventeen of this article.
(7) For purposes of this subsection, the term "dependent" shall
include a child as described in subsection (c) of this section.
(l)(1) As used in this subsection, "child" means an unmarried child
through age twenty-nine of an employee or member insured under a group
contract of hospital, medical or surgical expense insurance, regardless
of financial dependence, who is not insured by or eligible for coverage
under any employer health benefit plan as an employee or member, whether
insured or self-insured, and who lives, works or resides in New York
state or the service area of the corporation and who is not covered
under title XVIII of the United States Social Security Act (Medicare).
(2) In addition to the conversion privilege afforded by subsection (d)
of this section and the continuation privilege afforded by subsection
(e) of this section, a hospital service, health service or medical
expense corporation or health maintenance organization that provides
group hospital, medical or surgical coverage under which coverage of a
child terminates at a specified age shall, upon application of the
employee, member or child, as set forth in subparagraph (B) of this
paragraph, provide coverage to the child after that specified age and
through age twenty-nine without evidence of insurability, subject to all
of the terms and conditions of the group contract and the following:
(A) An employer shall not be required to pay all or part of the cost
of coverage for a child provided pursuant to this subsection;
(B) An employee, member or child who wishes to elect continuation of
coverage pursuant to this subsection shall request the continuation in
writing:
(i) within sixty days following the date coverage would otherwise
terminate due to reaching the specified age set forth in the group
contract;
(ii) within sixty days after meeting the requirements for child status
set forth in paragraph one of this subsection when coverage for the
child previously terminated; or
(iii) during an annual thirty-day open enrollment period, as described
in the contract;
(C) An employee, member or child electing continuation as described in
this subsection shall pay to the group contractholder or employer, but
not more frequently than on a monthly basis in advance, the amount of
the required premium payment on the due date of each payment. The
written election of continuation, together with the first premium
payment required to establish premium payment on a monthly basis in
advance, shall be given to the group contractholder or employer within
the time periods set forth in subparagraph (B) of this paragraph. Any
premium received within the thirty-day period after the due date shall
be considered timely;
(D) For any child electing coverage within sixty days of the date the
child would otherwise lose coverage due to reaching a specified age, the
effective date of the continuation coverage shall be the date coverage
would have otherwise terminated. For any child electing to resume
coverage during an annual open enrollment period, the effective date of
the continuation coverage shall be prospective no later than thirty days
after the election and payment of first premium;
(E) Coverage for a child pursuant to this subsection shall consist of
coverage that is identical to the coverage provided to the employee or
member parent. If coverage is modified under the contract for any group
of similarly situated employees or members, then the coverage shall also
be modified in the same manner for any child;
(F) Coverage shall terminate on the first to occur of the following:
(i) the date the child no longer meets the requirements of paragraph
one of this subsection;
(ii) the end of the period for which premium payments were made, if
there is a failure to make payment of a required premium payment within
the period of grace described in subparagraph (C) of this paragraph; or
(iii) the date on which the group contract is terminated and not
replaced by coverage under another group contract; and
(G) The corporation or health maintenance organization shall provide
written notification of the continuation privilege described in this
subsection and the time period in which to request continuation to the
employee or member:
(i) in each certificate of coverage; and
(ii) at least sixty days prior to termination at the specified age as
provided in the contract.
(3)(A) Corporations and health maintenance organizations shall submit
such reports as may be requested by the superintendent to evaluate the
effectiveness of coverage pursuant to this subsection including, but not
limited to, quarterly enrollment reports.
(B) The superintendent may promulgate regulations to ensure the
orderly implementation and operation of the continuation coverage
provided pursuant to this subsection, including premium rate
adjustments.
(m) A health care claim from a subscriber covered under a contract
issued pursuant to this section shall be submitted within one hundred
twenty days from the date of service; provided, however, that if it was
not reasonably possible for the subscriber to submit the claim within
that timeframe, then the claim shall be submitted as soon as reasonably
possible.
(n) (1) Any corporation subject to the provisions of this article that
issues hospital, surgical or medical expense contracts in the small
group or large group market in this state shall offer to any employer in
this state all such contracts in the applicable market, and shall accept
at all times throughout the year any employer that applies for any of
those contracts.
(2) The requirements of paragraph one of this subsection shall apply
with respect to an employer that applies for coverage either directly
from the corporation or through an association or trust to which the
corporation has issued coverage and in which the employer participates.

Structure New York Laws