What's happening
This bill allows local governments and districts in New York to jointly provide centralized employee benefits and health services, expands eligibility for municipal cooperative health plans, and permits premium reductions for wellness programs.
Why it matters
Streamlines employee benefits administration. By allowing multiple local government entities (cities, towns, villages, school districts, library districts, fire districts, etc.) to set up centralized offices for employee benefits and health services, the bill aims to reduce administrative duplication and potentially lower costs, making public sector employment more efficient and attractive.
Gives employees more choice and transparency. The centralized system can offer employees options among multiple health insurance carriers and plans, plus comparative information, which could lead to better plan selection and increased satisfaction among municipal workers.
Makes it easier for smaller municipalities and districts to access group health benefits. By lowering the minimum number of participating entities and covered employees required for municipal cooperative health benefit plans, the bill enables smaller governments and districts to pool risk and negotiate better terms, improving access to quality, affordable benefits.
Promotes public employee wellness and manages costs. By permitting premium reductions for participation in approved wellness programs, the bill encourages healthier behaviors among employees, which can lead to lower long-term healthcare costs for both governments and their workers, while explicitly preventing discrimination based on health outcomes.
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Plain English, a few words. Used as the page title.
Sponsors
1 Co-sponsor
History
- Referred to local government
- Referred to local government
Companion bill
The same bill in the other chamber. A bill becomes law when one version passes both houses and the governor signs it, so either number can carry it.
Share Employee Services
In Assembly Committee · Local Governments · Sponsor Kenneth Zebrowski
Full text
4 pagesUnderlined is new[Struck] is removedOfficial text on nysenate.gov ↗
STATE OF NEW YORK
1718
2017-2018 Regular Sessions
IN SENATE
January 10, 2017
Introduced by Sen. CARLUCCI -- read twice and ordered printed, and when printed to be committed to the Committee on Local Government
AN ACT to amend the general municipal law, in relation to authorizing cities, towns, villages, school districts, boards of cooperative educational services, library districts, fire districts, improvement districts and special districts to enter into cooperative agreements for the provision of centralized public employee administrative and personnel services; and to amend the insurance law, in relation to authorizing reduction of premiums for municipal cooperative health benefit plans which offer employee wellness programs
The People of the State of New York, represented in Senate and Assembly, do enact as follows:
Section 1. Section 92-a of the general municipal law is amended by adding a new subdivision 8 to read as follows:
8. The provisions of this section shall not apply to any public corporation which provides health insurance benefits to its officers and employees pursuant to article forty-seven of the insurance law.
§ 2. Subdivision a of section 119-n of the general municipal law, as amended by chapter 413 of the laws of 1991, is amended to read as follows:
a. The term "municipal corporation" means a county outside the city of New York, a city, a town, a village, a board of cooperative educational services, a public library as defined in section two hundred fifty-three of the education law, a fire district or a school district.
§ 3. Subdivision 2 of section 119-o of the general municipal law is amended by adding a new paragraph b-1 to read as follows:
b-1. The establishment of a centralized office to collectively provide:
(i) employee payroll, time, attendance and personnel administration services;
(ii) participation in the New York state health insurance program;
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD01961-01-7
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(iii) a personnel office to provide information on employee health insurance and other employee benefits;
(iv) employee health insurance benefits from more than one health insurance carrier or organization, which grants each employee the choice of which health insurance plan which will provide coverage;
(v) employee participation in tax deferred retirement plans, health care plans and child care plans;
(vi) municipal cooperative health benefit plans pursuant to article forty-seven of the insurance law;
(vii) adequate and ongoing financial controls and security arrangements to ensure that the participating municipal corporations and districts remain solvent;
(viii) the preparation and dissemination of informational and solicitation materials to facilitate comparison of the various employee health insurance plans offered by the participating municipal corporations and districts;
(ix) for the enrollment, billing, premium collection, premium disbursement and reconciliation, commission disbursement, and other processing services for health insurance benefits provided to municipal employees;
(x) contracting with qualified third parties for the provision of any service necessary to carry out such office's powers and duties; and
(xi) negotiation with participating health insurers and health maintenance organizations with regard to the administrative expenses portion of premium rates charged for health care coverage offered to municipal employees by such office.
§ 4. Subsections (a) and (f) of section 4702 of the insurance law, as added by chapter 689 of the laws of 1994, are amended and a new subsection (i-1) is added to read as follows:
(a) "Community rating" means a rating methodology in which the premium equivalent rate for all persons covered under a municipal cooperative health benefit plan is the same, based upon the experience of the entire pool of risks covered under the plan, without regard to age, sex, health status or occupation and such that refunds, rebates, credits or dividends based upon age, sex, health status or occupation are not permitted; provided, however, that, subject to the approval of the superintendent, such plan may provide an actuarially appropriate reduction in premium rates in return for an enrollee's or insured's adherence to a bona fide wellness program. A bona fide wellness program is either a risk management system that identifies at-risk populations or any other systematic program or course of medical conduct which helps to promote good health, helps to prevent or mitigate acute or chronic sickness or disease, or which minimizes adverse health consequences due to lifestyle. Such wellness program shall demonstrate actuarially that it encourages the general good health and well-being of the covered population. Such plan shall not require specific outcomes as a result of an enrollee's or insured's adherence to the approved wellness program.
(f) "Municipal corporation" means within the state of New York, a city [with a population of less than one million or], a county outside the city of New York, town, village, board of cooperative educational services, school district, a fire district, a public library, as defined in section two hundred fifty-three of the education law, or district, as defined in section one hundred nineteen-n of the general municipal law.
(i-1) "Stop-loss insurance" means an insurance policy whereby the insurer agrees to pay claims or indemnify a municipal corporation for losses incurred under a municipal cooperative health benefit plan in
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excess of specified loss limits for individual claims and/or for all claims combined, or any similar arrangement.
§ 5. Paragraphs 2 and 3 of subsection (a) of section 4704 of the insurance law, paragraph 2 as amended by section 3 of part A of chapter 494 of the laws of 2009 and paragraph 3 as added by chapter 689 of the laws of 1994, are amended to read as follows:
(2) except for any plan that provided medical, surgical and hospital services on or before January first, nineteen hundred ninety-three pursuant to a municipal cooperation agreement, the number of municipal corporations participating in the municipal cooperative health benefit plan shall be at least [three] two;
(3) except for any plan that provided medical, surgical and hospital services to at least three hundred fifty covered employees (including retirees and not including dependents) on or before January first, nineteen hundred ninety-three pursuant to a municipal cooperation agreement, the number of covered employees (including retirees and not including dependents) of municipal corporations participating in the municipal cooperative health benefit plan shall be at least [two thousand] five hundred;
§ 6. Subsection (b) of section 4704 of the insurance law, as added by chapter 689 of the laws of 1994, is amended to read as follows:
(b) The superintendent shall refuse to grant a certificate of authority to an applicant that fails to meet the requirements of this section. Notice of refusal shall be in writing and shall set forth the basis for the refusal. If the applicant submits a written request within [thirty] sixty days after receipt of the notice of refusal, the superintendent shall promptly conduct a hearing to give the applicant the opportunity to show cause why the refusal should not be made final.
§ 7. Paragraphs 1, 2 and 5 of subsection (d) of section 4705 of the insurance law, paragraphs 1 and 5 as added by chapter 689 of the laws of 1994 and paragraph 2 as amended by chapter 681 of the laws of 2002, are amended to read as follows:
(1) shall design the plan or plans of benefits provided or offered by the municipal cooperative health benefit plan and prepare the plan document and summary plan description in accordance with section four thousand seven hundred nine of this article, and shall include a wellness program option;
(2) may enter into an agreement with a contract administrator or other service provider, determined by the governing board to be qualified, to receive, investigate, recommend, audit, approve or make payment of claims under the municipal cooperative health benefit plan or plans, provided that:
(A) the charges, fees and other compensation for any contracted services shall be clearly stated in written administrative services contracts as required in subdivision six of section ninety-two-a of the general municipal law;
(B) payment for contracted services shall be made only after such services are rendered; and
(C) no member of the plan's governing board or any member of such member's immediate family shall be an owner, officer, director, partner, or employee of any contract administrator retained by the plan[; and
(D) all such agreements shall comply with the requirements of subdivision six of section ninety-two-a of the general municipal law].
(5) shall prepare an annual budget for the municipal cooperative health benefit plan to determine the premium equivalent rates for
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participating municipal corporations to be deposited in the plan's joint fund or funds during the fiscal year, provided that:
(A) the governing board shall designate the bank or trust company in which joint funds, including reserve funds, are to be deposited and which shall be located in this state, duly chartered under federal law or the laws of this state; and
(B) the governing board shall establish premium equivalent rates for participating municipal corporations on the [bases] basis of a community rating methodology filed with and approved by the superintendent and, in determining the annual premium equivalent rates, the governing board:
(i) may contract for necessary actuarial services to estimate expected plan expenditures during the fiscal year;
(ii) shall maintain reserves in amounts equal to or exceeding the minimum amounts required by section four thousand seven hundred six of this article; and
(iii) shall maintain a stop-loss policy or policies, to the extent required by section four thousand seven hundred seven of this article;
§ 8. Subparagraphs (A) and (B) of paragraph 5 of subsection (a) of section 4706 of the insurance law, as added by chapter 689 of the laws of 1994, are amended to read as follows:
(A) five percent of the annualized earned premium equivalents during the current fiscal year of a municipal cooperative health benefit plan which consists of [five] two or more participating municipal corporations and covers [two thousand] five hundred or more employees and retirees; or
(B) seven percent of the annualized earned premium equivalents during the current fiscal year of the municipal cooperative health benefit plan which consists of [four] two or fewer participating municipal corporations or covers fewer than [two thousand] five hundred employees and retirees.
§ 9. This act shall take effect on the first of January next succeeding the date on which it shall have become a law.
Reflowed for reading: line numbers and page breaks removed. Cite the official text.
Sponsor's memo
Title of bill
An act to amend the general municipal law, in relation to authorizing cities, towns, villages, school districts, boards of cooperative educational services, library districts, fire districts, improvement districts and special districts to enter into cooperative agreements for the provision of centralized public employee administrative and personnel services; and to amend the insurance law, in relation to authorizing reduction of premiums for municipal cooperative health benefit plans which offer employee wellness programs
Purpose
To enhance the ability of municipalities to join forces and cooperatively provide and mange employee benefits in a manner that reduces the cost of providing such, benefits but which is also able to give municipal employees more choices in the benefits provided. Further, it clearly enables municipalities to, cooperatively administer such employee benefits and other administrative personnel overhead costs to help lower the overall cost of municipal government.
Summary of provisions
Section 1 amends section 92-a of the general municipal law by adding a new subdivision 8 so that the provisions of this section shall not apply if a municipal cooperative health plan is establishes pursuant to Insurance Law Article 47.
Read the full memo (1,040 words)
Section 2 amends General Municipal Law section 119-n to expand the definition of municipal corporation for the purpose of expanding the scope of Article 5-g of the General Municipal Law which relates to municipal cooperative agreements or activities.
Section 3 amends subdivision 2 of section 199-o of the general municipal law to add a new paragraph (b-1) to specifically authorize municipalities to cooperative establish a centralized administrative office to share responsibilities and work for the administration of certain employee personnel services such as: employee payroll, time & attendance; participation in the NYS Health Insurance program (NYSHIP); the establishment of shared use and selection of various health care plans for its municipal employees; employee participation in tax deferred retirement plans, health care plans, and child care plans; municipal cooperative health plans established pursuant to Insurance Law article 47; and contracting with third party administrators to manage all shared employee health care benefits or tax deferred programs.
Section 4 amends Insurance Law section 4702 which is the definition section of Insurance Law Article 47 which allows municipalities to establish self-insured municipal cooperative health benefit plans. This provision allows the premium rates for such health plans to allow for an actuarially appropriate reduction in premium rates for municipal employees that participate in wellness programs approved by the Insurance Department. Such Wellness programs can be either .a risk management system that identifies at risk populations or any other systematic program or course of medical conduct which helps to promote good health or mitigates against acute or chronic sickness or disease. Also, for clarity, it adds the definition for "stop loss insurance" for the use in Article 47 of the Insurance Law.
Section 5 amends Insurance Law section 4704 to reduce the number of municipalities that are needed to participate in a cooperative health benefit plan from 3 to 2. In addition, the number of covered employees needed to establish such plan is reduced from 2,000 to 500.
Section 6 amends Insurance Law section 4704(b) to extend the time period from 30 days to 60 days after the Insurance Department's denial of an application to establish a municipal cooperative health benefit plan for the municipal applicants to appeal such a ruling.
Section 7 amends Insurance Law section 4705 so that the municipal cooperative health benefit plan can offer one or more than one health benefit plans to its municipal employee members. Further, that a Wellness Program option, with a reduced premium rate, may also be offered.
Section 8 amends Insurance Law section 4706 that relates to reserve and surplus requirements so that such reserves may be reduced to reflect a smaller number of municipal participants and number of covered employee.
Section 9 is the effective date.
Justification
The cost of municipal government in New York continues to escalate, hence local real property taxes to support such governmental activities continues to increase. Further, due to New York's declining tax base in many sections of New York, this had lead to further increases in municipal tax rates to compensate for the reduced assess value of real property. The Purpose of this bill is to give municipalities the tools that they need to cooperatively provide services and administer municipal employee benefits. Municipal employee benefits are a major part of the cost of running local municipal governments. This bill attempts to enhance the ability of municipalities to cooperatively provide municipal employee benefits such as health insurance, and tax deferred employee plans such as retirement, health flex, and child care plans. Further, it will allow municipalities to offer their employees the ability to participate in more health insurance plans that better reflect the needs of its employees. This increase in choice of plans can help to reduce the cost of providing benefits because employees will be able to better select the benefit plans that matches their family's needs (which can be at a reduced cost). Further, by increasing a municipality's ability to offer different health plans, this can increase employee satisfaction and hopefully productivity.
The bill also allows municipalities, either alone or in conjunction with others, to reduce premium rates if its employees to participate in Wellness programs. Not only will the participation in Wellness Programs help to reduce premium rates, it can increase the well being of its employees and hence, their work productivity via fewer sick days or injuries.
This bill also authorizes municipalities, either alone or jointly, to offer the Healthy NY insurance product which is, on average, cheaper than other health insurance products. Further, it can help reduce the overhead costs that municipalities experience to administer employee benefits by specifically allowing municipalities to join forces to share the cost of administering the servicers performed by a personnel office or by the town or village clerk.
Legislative history
2011-12 - S.2843 - Passed the Senate; 2013-14 - S.1994 - Referred to Local Government 2015-16: S3224/A5130 - local government/local government
Fiscal implications
Anticipated savings for to local governments. EFFECTIVE DATE : This act shall take effect on the first of January next succeeding the date on which it shall have become a law.
Summaries, headlines and scores are AI-generated from the official bill text. How we score bills. Source: NYS Open Legislation.