Yesterday, Tuesday November 5, The Department of Financial Services (DFS) made an important announcement regarding early renewal in the small group market. If you have elected to renew health insurance coverage in 2013 that would not renew in 2014 to avoid the requirements of the Affordable Care Act you will be in violation of the law. We want to bring this important news to your attention as we, SWIM Inc., are operating in accordance with the DFS directive.
In addition, we are aware of brokers in the marketplace that are actively promoting the actions the DFS has indicated are a violation. Our job to you, our clients, is to ensure you are in compliance. And so we stand by our motto: “Integrity is what we do, what we say, and what we say we do.”
Announcement from DFS:
The Department of Financial Services is concerned that certain small employer groups may have elected to renew health insurance coverage in 2013 that would otherwise not renew until 2014 in order to avoid the requirements of the Affordable Care Act (ACA) that take effect on January 1, 2014. Health insurance producers are hereby reminded that in accordance with the New York State Insurance Law Sections 3221(s) and 4303(nn), insurers and insurance producers are not permitted to renew a small group policy which provides hospital, surgical or medical expense coverage that renews on or after January 1, 2014, but before July 1, 2014, prior to the policy’s annual renewal date for the sole purpose of evading the requirements of the ACA and regulations promulgated thereunder. Health insurance producers that steer small employer groups toward early renewal of coverage for the sole purpose of avoiding the requirements of the ACA may be in violation of the Insurance Law. Likewise, insurers who early renew coverage for small groups for the sole purpose of avoiding the requirements of the ACA may also be in violation of the Insurance Law. An isolated, inadvertent renewal date change that was not made for the sole purpose of evading the requirements of the ACA shall not be deemed a violation.
Jeffrey R. Ungvary