Thiele bill aims to protect patients, health care providers
Assemblyman Fred Thiele Jr. (I-Sag Harbor) has joined Health Committee Chairman Richard Gottfried (D-Manhattan) to sponsor a bill that would establish a state Health Insurance Consumer Protection Security Fund.The fund would reimburse providers for uncompensated care delivered to patients whose health insurance companies became insolvent.
The proposed legislation calls for a one-time assessment on remaining health insurers, not a permanent tax, Mr. Thiele said. It would also prohibit insurers from passing on assessments to policy holders. The assessment would be based on premiums received by the insurance companies during the previous calendar year.
The superintendent of the Department of Financial Services would be authorized to adjust or suspend assessment based on a health insurer’s financial situation, Mr. Thiele said.
What prompted the proposed legislation was the failure of Health Republic Insurance of New York that “severely harmed” both consumers and providers, the legislator said.
“The company owes hospital and doctors across the state hundreds of millions of dollars and its demise left consumers worried about their access to care as they scrambled for new coverage,” he said.
Health Republic wasn’t the first such company to fail, he said, noting that in 998, Wellcare went under.
“This bill would remedy that situation by creating a health insurance guaranty fund, a basic consumer protection enjoyed by every other state in the nation,” Mr. Thiele said.
The one-time assessment to existing insurers would be offset by new customers who were dropped by the defaulting company, the legislator said.
The state has similar protection for property and casualty coverage and now needs to extend it to health insurance, he said.
“Fortunately, insurer failures are rate, but when they do occur, we need a statutory framework with protections that allow consumers to transition smoothly to other coverage and ensure they have continued access to health service through stable provider networks,” Mr. Thiele said.
