NEW YORK STATE ASSEMBLY MEMORANDUM IN SUPPORT OF LEGISLATION submitted in accordance with Assembly Rule III, Sec 1(f)
BILL NUMBER: A10218A
SPONSOR: Woerner 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 make permanent provisions of law relating to catastrophic or reinsur-
ance 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 576 of the laws of 2023 is
amended to extend the provisions for three years (2031).
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 576 of the laws of 2023
is amended to extend the provisions for three years (2031).
JUSTIFICATION:
Prior to the passage of the Affordable Care Act (ACA), New York State
and federal law permitted 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 150. In 2015, New York State changed its defi-
nition of a "small group employer" to mean 1-100 employees. As a result,
any employer falling below one hundred employees would no longer be
permitted to participate in an experience-rated health insurance plan
and would instead be required to 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 be impacted, but so would all those
remaining in their consortiums because there would be few members in
their consortium 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, the state has provided
several temporary extensions since 2015 to permit districts to remain in
their health care consortiums.
LEGISLATIVE HISTORY:
New bill.
FISCAL IMPLICATIONS:
To be determined.
EFFECTIVE DATE:
This act shall take effect immediately.
STATE OF NEW YORK
________________________________________________________________________
10218--A
IN ASSEMBLY
February 12, 2026
___________
Introduced by M. of A. WOERNER, McDONALD -- read once and referred to
the Committee on Insurance -- committee discharged, bill amended,
ordered reprinted as amended and recommitted to said committee
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
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. Section 5 of chapter 589 of the laws of 2015, amending the
2 insurance law relating to catastrophic or reinsurance coverage issued to
3 certain small groups, as amended by chapter 576 of the laws of 2023, is
4 amended to read as follows:
5 § 5. This act shall take effect on the same date and in the same
6 manner as chapter 588 of the laws of 2015, takes effect and shall be
7 deemed repealed [thirteen] sixteen years thereafter.
8 § 2. Section 5 of chapter 588 of the laws of 2015, amending the insur-
9 ance law relating to catastrophic or reinsurance coverage issued to
10 certain small groups, as amended by chapter 576 of the laws of 2023, is
11 amended to read as follows:
12 § 5. This act shall take effect immediately; and shall be deemed
13 repealed [thirteen] sixteen years after it shall have become a law.
14 § 3. This act shall take effect immediately.
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD14728-03-6
