New York State
Insurance Department

            Superintendent of Insurance Neil D. Levin today announced that the Department has fined Empire Blue Cross & Blue Shield $1.25 million for violations of the New York State Insurance Law. These violations occurred during the period from January 1, 1997 to December 31, 1998.

            According to the stipulation, the company violated the Insurance Law and Department regulations by the following conduct: failing to make proper adjustments between guaranteed rates and approved rates within 12 months after the end of the contract year or contract termination if earlier for certain Blue Choice HMO Group contracts.

            In addition to paying the fine, the company has agreed in the stipulation to put corrective measures in place, including programs and procedures that will ensure future compliance with all Department regulations.