BILL NUMBER: S5236
SPONSOR: COMRIE
 
TITLE OF BILL:
An act to amend the insurance law, in relation to requiring actuarial
certification of certain rate determinations made by the superintendent
of financial services
 
PURPOSE:
The purpose of this bill is to require that all rate determinations made
by the superintendent be reviewed and certified by a licensed actuary.
 
SUMMARY OF PROVISIONS:
Section 1 amends paragraph 1 of subsection (d) and subparagraph (A) of
paragraph 1 of subsection (e) of section 3231 of the- insurance law,
paragraph 1 of subsection (d) as amended by section 1 of part A of chap-
ter 494 of the laws of 2009, and subparagraph (A) of paragraph 1 of
subsection (e) as amended by chapter 107 of the laws of 2010 and as
further amended by section 104 of part A of chapter 62 of the laws of
2011 to require that all rate determinations made by the superintendent
be reviewed and certified by a licensed actuary.
Section 2 amends subsection (b) and paragraph 2 of subsection (c) of
section 4308 of the insurance law, as amended by chapter 107 of the laws
of 2010, and paragraph 2 of subsection (0) as further amended by section
104 of part A of chapter 62 of the laws of 2011 to require that all rate
determinations made by the superintendent be reviewed and certified. by
a licensed actuary.
Section 3 provides the effective date.
 
JUSTIFICATION:
Currently, health plans that operate in New York are required to file a
schedule of annual premiums for review and approval of the Department of
Financial Services (DES). As part of this filing, the plans are required
to demonstrate that the proposed rates were reviewed and certified by a
licensed actuary, with a detailed description of the actuarial assump-
tions and methods used to calculate the proposed premiums.
While DES has the authority to adjust plan proposed rates, there is no
requirement that the DES actuaries must certify that the rates they
approve are actuarially sound. It is reasonable to require DES to certi-
fy that its rates are actuarially appropriate and sound just as health
plans are required to do. The current process has resulted in a lack of
transparency and predictability in the current rate setting process.
Currently, Department of Health actuaries are already required to certi-
fy that Medicaid rates are actuarially sound. This certification will
help ensure that approved rates are actuarially sound when annual rates
are finalized for each veer.
 
LEGISLATIVE HISTORY:
23/24 - S1464 BRESLIN / A4192 Stern
S3575 - 20/215.5928-19/20
 
FISCAL IMPLICATIONS:
None.
 
EFFECTIVE DATE:
This act shall take effect immediately.