MEMORANDUM IN OPPOSITION
FOR IMMEDIATE RELEASE: FEBRUARY 5, 2019
RE: S.2407 (Comrie)/A.679 (Niou)—AN ACT to amend the general business law, in relation to standing for persons affected by prohibited or unlawful business practices.
The New York Health Plan Association (HPA), which represents 28 health plans that provide coverage
to 8 million New Yorkers, is writing to oppose S.2407/A.679. The legislation would amend the general
business law by expanding the definition of prohibited or unlawful business practices, create new legal
rights under which individuals may seek damages, and increase the level of damages that an individual may seek. Measures already exist to address prohibited and unlawful business practices and expanding the ability to sue would lead to higher health care costs in response to the threat of litigation brought against health plans.
This legislation is overly broad. By removing the current statutory provision that it shall be a complete
defense if an action complies with federal rules and regulations, S.2407/A.679 creates the potential for
establishing state requirements that conflict with federal standards.
Health plans today are held accountable for compliance with a wide range of state and federal laws
that protect consumers including standards related to internal and external appeals, quality assurance
programs, utilization management activities, and the payment of claims. The state already has the
authority to enforce these requirements through a number of means including civil monetary penalties
and revocation of licensure for violations of state or federal requirements. Similarly, health plans that
fail to live up to their contractual obligations for benefits coverage may be subject to civil lawsuits for
breach of contract. Expanding the right to sue by allowing statutory damages of up to $2,000 to be
added to any actual damages is completely unnecessary and dangerous to the solvency of carriers and
the affordability of health insurance.
This legislation adds on to an otherwise comprehensive state regulatory scheme that already exists and
will drive up health care costs for employers and consumers at a time when the focus should be
directed on measures to make health care more affordable. For all these reasons, we urge you to oppose
S.2407/A.679.