Consumer Protections in New York
New Yorkers are protected by a number of important state and federal policies and regulations designed to make quality health insurance more accessible. This section discusses several of these protections.
Guaranteed Issue And Renewability
Unlike many other parts of the country, in New York your health insurance options do not depend on your health status, age, or any other factor that might predict the use of health services by you or your employees. Instead, your ability to get health insurance is dependent on your being an individual residing or a business operating in New York State and your ability to pay the premium. This protection is called guaranteed issue.
In addition, your health plan cannot be cancelled because you get sick or submit a lot of claims. This is called guaranteed renewability.
Community Rating
The premium your health insurance carrier charges cannot depend on your or your employees’ health status, age, gender, occupation or pre-existing conditions. Instead, premiums are based on the average cost of offering coverage to all individuals seeking the same plan from the same insurer in the same geographic area. This is called community rating.
Individual/Direct Pay Plans
New York State has enacted comprehensive insurance reforms to ensure individuals’ access to health insurance. Health plans purchased by individuals are sometimes referred to as “direct pay” because the consumer is purchasing the plan directly from the insurer. Health insurers operating in the State are required to offer an HMO and POS “standardized comprehensive managed care plan” to individuals. These standard plans include physician and hospital care, maternity care, preventive checkups and immunizations, and prescription drug coverage. The State Insurance Department’s website has a list of plans available in each county at www.dfs.ny.gov/insurance/ihmoindx.htm.
Consumer Rights
New York State requires health plans subject to New York law (e.g. plans sold to individuals, sole proprietors and most small businesses) provide individuals with certain services, commonly called “consumer rights,” that include:
- Information about their current plan or one they are considering purchasing
- Health care services
- Emergency services
- Certain women’s health care services
- A process for appealing coverage denials
Federal law, including under the Affordable Care Act (ACA), also contains some of these protections for certain health plans. To learn more about new consumer rights contained in the ACA, visit our section on federal health care reform.
Below are brief descriptions of some of these requirements. However, not all requirements apply to every type of coverage. If you have a question about whether a requirement applies to your plan, you can read more about these and other protections by visiting the NYS Department of Financial Services (NYS DFS) website: http://www.dfs.ny.gov/insurance/hrights.htm. You can also speak to a NYS DOI representative Monday through Friday, 9 AM to 5 PM, by calling 1-800-342-3736.
- Disclosure of health plan information
You have the right to detailed information regarding the scope of coverage, including the benefits, limitations, and prior authorization requirements for your current health plan or one you are considering purchasing. You also are entitled to information about your financial responsibilities, the plan’s grievance procedures, and how to access covered care.
- Access to care
Primarily for persons enrolled in managed care arrangements, such as HMOs, these include the right to choose your primary care physician, request your specialist coordinate your care if you have a life-threatening or disabling condition, access an out-of-network specialist if no in-network provider can treat you, and have your provider discuss all treatments for a medical condition with you.
- Emergency care
Health plans that offer inpatient hospital care must provide coverage for treatment in hospital emergency rooms. The health plan cannot require that you seek prior approval for emergency care.
- Women's care
Women’s access to certain health care services is protected by several laws; however, how they apply can vary by plan. Depending on the specifics of your plan, you may be entitled to care that includes:
1. Access to preventive or primary care, including direct access to primary and preventive OB/GYN services, bone mineral density measurements and testing, cervical cancer screening and breast cancer screening
2. Reproductive and maternity care, including contraceptive drugs and devices when drug coverage is provided and maternity care
3. Breast cancer care, including a mastectomy and reconstructive surgery
- Grievance procedures (internal and external appeals)
You can file a grievance with your health plan if you are denied a referral, if your plan determines a benefit is not covered, or if you have a complaint about a benefit determination other than one involving medical necessity. You can also appeal decisions by your plan that care is not medically necessary, as well as seek an external review for any service denied because the plan considers it experimental, investigational or not medically necessary. Click here for a summary of internal appeals process requirements; and click here for a summary of external appeals process requirements.
For more information on health insurance plans in New York State, including a ranking of plans by complaints and information on how to choose a health insurer based on quality of care and service, see New York Consumer Guide to Health Insurers
Source: The NYS Department of Financial Services Health Insurance Resource Center: "Your Rights as a Health Insurance Consumer": www.dfs.ny.gov/insurance/hrights.htm
Prior Approval
New York State requires insurers who want to raise or lower their health plan premiums for individual, small employer, and some large group plans to obtain permission or “prior approval” first. Prior approval is not required for large employer plans that “self-insure,” meaning they do not buy their coverage from an insurer.
Prior approval means that insurers must obtain approval from the Department of Financial Services before they can raise or lower their premiums.
Insurers must also must first notify policyholders that they plan to change their rates and given them a chance to comment on the proposed premium increase or decrease. Specifically:
1. Insurers must let policyholders know they plan to change their premiums at least 120 days before changing their rates.
2. Policyholders have 30 days to submit written comments to the Department of Financial Services.
3. Comments will be posted on the Department’s website.
The Department of Financial Services will approve, modify, or disapprove the requested premium adjustment. In making its decision, the Department considers all relevant comments from policyholders, the future and current costs of medical care and prescription drugs, the insurers’ history of rate changes, and other administrative costs and considerations.
After the insurer’s rate change has been approved the insurer must let the policyholder know at least 60 days in advance how much their premium will increase or decrease, so that they have some time to decide whether to keep their coverage or look for another plan.
Go to this page to submit a comment. Click here for more information about prior approval.
Limits On Pre-existing Condition Exclusions
In general, when an insurer imposes a “pre-existing condition exclusion”, it means the insurer has excluded coverage for a medical condition that existed and/or for which the enrollee received treatment during a specified time period prior to enrolling in the health plan. Federal and New York State law provides consumers some protections in this matter.
In the small-group market, a health plan can count as pre-existing conditions only those for which medical advice was given or treatment was recommended or received from a physician within the 6 months immediately before joining that plan. Health plans can only exclude coverage (impose a waiting period) for adults with pre-existing conditions for up to 12 months. If you had prior coverage for the condition and had continuous coverage or a break in coverage for less than 63 days, the health plan must subtract the time you had coverage in your prior plan from the waiting period time. In addition, group health plans cannot apply a pre-existing condition exclusion period for pregnancy, children, or genetic information.
Similarly, a pre-existing condition exclusion waiting period for individual/direct pay plans cannot exceed 12 months. In the individual market insurers are permitted to regard pregnancy as a pre-existing condition. As with small-group plans, genetic information cannot be considered a pre-existing condition, and for individual market plans purchased after September 23, 2010, insurers cannot impose a waiting period on coverage for children.
Be aware that if you are thinking about purchasing private insurance it is important to act quickly. If COBRA is an option, you have only 60 days to elect this coverage. And if you are purchasing other private coverage, you must do so within 63 days of losing previously held coverage in order for adults in the family to avoid waiting periods for pre-existing conditions.
COBRA Coverage For Employees Of Small Businesses
Federal law mandates that businesses with 20 or more employees maintaining a group health plan extend COBRA coverage to employees experiencing a voluntary or involuntary separation. Employees that choose COBRA coverage can continue to access the same group coverage by paying the full cost of the insurance. New York State has a similar law that extends COBRA-like coverage to employees of smaller businesses (those with 2-19 employees) and qualifying dependents.
Under both federal and New York State law, your employer or benefits administrator has an obligation to inform you of your right to continue coverage. Continuation of coverage is also available for family members of employees who qualify because of death, divorce, and other life events. Individuals and families opting for continuation of coverage under federal or New York State law must elect coverage within a specified time period (normally 60 days after receiving notice of COBRA eligibility) and pay the applicable premium.
Individuals eligible for COBRA continuation coverage as a result of involuntary job loss may have also qualified for federal assistance provided by the American Recovery and Reinvestment Act (ARRA). The U.S. Department of Labor has more information on this program: http://www.dol.gov/ebsa/COBRA.html.
New York State residents working in the entertainment industry may also be able to reduce their COBRA costs by accessing premium subsidy support under the State's Health Insurance Continuation Assistance Demonstration Program.
For more information on your health care options under COBRA, contact your employer or the following:
Additional Resources for More Information on Consumer Protections in New York State:
Last Updated: February 1, 2013