New York State Seal
STATE OF NEW YORK
INSURANCE DEPARTMENT
25 BEAVER STREET
NEW YORK, NEW YORK 10004

David A. Paterson
Governor

Eric R. Dinallo
Superintendent

OGC Op. No. 09-04-12

The Office of General Counsel issued the following opinion on April 22, 2009, representing the position of the New York State Insurance Department.

Re: Accident and Health Insurance and Work-related Injury

Question Presented:

After acceptance by all necessary parties of a New York Workers’ Compensation Law § 32 (McKinney Supp. 2009) lump-sum waiver agreement, is the insured’s health insurance plan obligated to pay future medical expenses arising from the insured’s original injury?

Conclusion:

It depends on the specific language of the policy. Section 52.16(c)(8) of 11 NYCRR 52 (Regulation 62) permits a health insurer to exclude benefits provided under a workers’ compensation policy.

Facts:

A law firm reports that it represents a municipal cooperative health benefit plan organized in accordance with Article 47 of the Insurance Law. An insured covered under such a plan sustained a work-related injury for which she received workers’ compensation benefits, which included payment of her medical bills. She entered into a lump-sum settlement with her employer in 1996. In the past year, the insured sought medical treatment for that work-related injury, and submitted bills to the health benefit plan for payment. The health benefit plan rejected her claims, and thereafter she appealed, arguing that since the workers’ compensation case settled and closed, the plan is responsible to pay the medical bills. No indication is made as to whether the insured tried to have the lump-sum agreement modified, or whether the health insurance policy includes an exclusion for injuries covered under workers’ compensation. The inquirer asks whether the plan is obligated to pay the insured’s claims.

Analysis:

Workers’ Compensation Law § 11 provides that where an injury occurs that arises out of employment, the Workers’ Compensation Law provides the sole and exclusive remedy against the employer. Nevertheless, the employee still may seek coverage under a health insurance policy.

Although an accident and health insurer is generally responsible to pay the medical expenses of its insured, there are exceptions set forth in Regulation 62. An Article 47 health plan such as the one in issue is subject to Regulation 62. See N.Y. Ins. Law § 4709(b) (McKinney 2007). As set forth in 11 NYCRR § 52.16(c)(8):

No policy shall limit or exclude coverage by type of illness, accident, treatment or medical condition, except as follows:. . . (8) . . . benefits provided under Medicare or other governmental program. . . , any State or Federal workers’ compensation, employers’ liability or occupational disease law;…

Thus, a health insurance policy can limit coverage where benefits are provided pursuant to a workers’ compensation law. If a policy does not include such limitation, then the health insurer is required to pay a claim, irrespective of the possible existence of benefits under the Workers’ Compensation Law. See Office of General Counsel opinions dated August 15, 2002 and December 18, 2006. But as noted above, the Department at this time lacks sufficient facts to render an opinion about the specific question presented.

For further information you may contact Associate Attorney Jeffrey A. Stonehill at the New York City Office.