New York State Seal

STATE OF NEW YORK
INSURANCE DEPARTMENT

AGENCY BUILDING ONE
EMPIRE STATE PLAZA
ALBANY, NEW YORK   12257


                                                                                                 

Circular Letter No. 9 (1997)
April 4, 1997


                                                                                                 

TO: All Insurers Licensed to Write Accident and Health Insurance in New York State (Insurance Law Section 1113(a)(3) )

RE:  Provider Excess Insurance

In response to inquiries regarding the availability of provider excess insurance in New York State, this Department wishes to advise the captioned entities that provider excess insurance will be deemed to be "substantially similar" to accident and health insurance as defined in Insurance Law Section 1113(a)(3).

"Provider excess insurance" is a term usually applied to coverage issued to protect health providers from a portion of the financial risk they assume in managed care contracts with insurers and health maintenance organizations. The term "provider stop-loss" or terms of similar import are also sometimes used to describe such coverage.

Where a particular type of insurance does not fit within any of the specific kinds of insurance set forth in Section 1113(a), the Superintendent has the discretion to allow it as a "substantially similar kind of insurance" pursuant to Insurance Law Section 1113 (a)(30), which provides as follows:

Pursuant to Section 1113 (a)(30), in the opinion of the Superintendent, "provider excess insurance" is determined to be substantially similar to accident and health insurance as defined in Section 1113(a)(3), is deemed to be included in that kind of insurance, and may be written in this State by insurers so licensed.

Please direct any questions concerning this Circular Letter to Mr. Austin J. Rinella, Supervising Insurance Attorney, Life and Health Bureau, at (518) 473-7470.