N.Y. Comp. Codes R. & Regs. Tit. 11 §§ 362-1.1

Current through Register Vol. 46, No. 45, November 2, 2024

Section 362-1.1 - Preamble

The programs described in this Part shall be known as the Healthy New York Program and the Direct Payment Stop Loss Relief Program.

(a) Chapter 1 of the Laws of 1999 establishes the Healthy New York Program which is a new initiative designed to encourage small employers which do not provide health insurance coverage for their employees to offer such coverage and also designed to make coverage available to uninsured employees whose employers do not provide group health insurance coverage.

(b) At the time of enactment of chapter 1 of the Laws of 1999, a significant number of New York residents were uninsured. Due in part to the rising cost of health insurance coverage, many small employers were unable to provide health insurance coverage to their employees. A significant portion of New York State's uninsured population was made up of individuals employed in small businesses.

(c) Through the creation of a standardized health insurance benefit package to be offered by all health maintenance organizations which is made more affordable through the availability of State funded stop loss reimbursement, the Healthy New York Program should encourage more small employers and uninsured employed individuals to purchase health insurance coverage.

(d) Chapter 1 of the Laws of 1999 also established the Direct Payment Market Stop Loss Relief Program designed to provide premium and market stability to New York's direct payment health insurance market through use of a stop loss mechanism.

(e) The rising cost of health care was a very serious problem that New York State and the nation were facing at the time of the enactment of chapter 1 of the Laws of 1999. Increases in health insurance premiums were directly related to increases in the cost of health care. Such rising costs were exacerbated in the individual insurance market where the pool of insureds typically includes less healthy (higher risk) individuals than those covered through their employers in the group insurance market.

(f) At the time of the enactment of chapter 1 of the Laws of 1999, sections 4321 and 4322 of the Insurance Law required all health maintenance organizations to offer two distinct comprehensive standardized individual enrollee direct payment contracts. This requirement was mandated by law for the purpose of ensuring individual access to comprehensive insurance to meet their health care needs. However, the premium rates for these contracts were high and continuing to increase.

(g) Chapter 1 of the Laws of 1999 enacted sections 4321-a and 4322-a of the Insurance Law to create a program designed to ensure that individual consumers have continued access to comprehensive health insurance. The provisions require the establishment of two stop loss funds from which health maintenance organizations may receive reimbursement for certain claims paid on behalf of members covered under individual enrollee direct payment contracts. The availability of reimbursement through such stop loss funds should have a favorable impact on the cost of such coverage for the benefit of both existing enrollees and currently uninsured persons seeking to purchase such coverage.

N.Y. Comp. Codes R. & Regs. Tit. 11 §§ 362-1.1