New York State
Insurance Department

New York, August 27, 1998

INSURANCE DEPARTMENT ANNOUNCES PUBLIC HEARINGS ON RATE INCREASES PROPOSED BY EMPIRE BLUE CROSS & BLUE SHIELD HEALTHNET

          Superintendent of Insurance Neil D. Levin announced that the Insurance Department will hold public hearings in Manhattan, Albany and Poughkeepsie as part of its review of a rate increase application filed by Healthnet, Empire Blue Cross and Blue Shield’s HMO. The increases would affect approximately 63,500 community-rated BlueChoice group contractholders (including Direct Connection and BlueCare products) in its New York, Mid-Hudson and Albany regions. 

          Empire’s application makes three proposals: 1) the elimination of its Mid-Hudson rating region and the distribution of the region’s counties to the Albany and New York regions; 2) the combining of small group and large group rating classes in the New York region; and 3) the substitution of rolling premium rates, a guaranteed rate methodology, for the annual level subscriber rate methodology currently in use by BlueChoice contracts with the Prestige network. 

          Under the rolling rate premium methodology, the application proposes that all affected contractholders will start paying the higher rates on their renewal dates beginning with October 1, 1998 renewals. 

          Empire is requesting an overall weighted average increase of 20.8%. By region, the average rate request is 19.8% for the New York region, 32.5% for Dutchess and Putnam Counties, 2.5% for Orange, Sullivan and Ulster Counties, and 31.2% for the Albany region. These increases DO NOT affect Medicare supplement contracts, experience-rated groups, participants in subsidized programs, direct payment (nongroup) subscribers, and all non-BlueChoice HMO community-rated groups. 

          The public hearings are scheduled as follows: 

          Individuals wishing to testify at the New York City, Albany or Poughkeepsie hearings should contact the Insurance Department so that a schedule of speakers may be prepared. The Department has established a toll-free telephone number for this purpose. This number, 1-888-880-8961, is operational between 9:00 a.m. and 3:00 p.m. In accordance with the Americans with Disabilities Act, the Insurance Department will provide a reasonable accommodation at no charge to any covered individual wishing to attend or testify at the hearing when such a request is made at least seven days before the hearing. 

          Those unable to attend the hearings may submit written statements for inclusion in the official record within ten days following the hearing date. Written statements should be directed to: Public Affairs & Research Bureau, New York State Insurance Department, 25 Beaver Street, New York, NY 10004. 

          A narrative summary of Empire’s application is available to the public through Empire’s Public Information Department at 622 Third Avenue, New York, NY 10017 (1-888-476-5524). The narrative is also available by contacting the Insurance Department’s special toll-free number (1-888-880-8961). 

          A copy of the complete subscriber rate increase application may be examined at Empire’s offices at: Law Library, 25^th floor, 622 Third Avenue, Manhattan; 1 Corporate Woods Boulevard, Albany; 63 Washington Street, Poughkeepsie; or 157 Deer Park Avenue, Babylon. The complete application may also be reviewed at the Insurance Department’s offices by appointment only at the Health Bureau, 4^th floor, 25 Beaver Street, Manhattan (212-480-5242) or Agency Building One, 8^th floor, Empire State Plaza, Albany. 

          Empire’s New York region covers subscribers in New York City, Long Island, and Westchester and Rockland Counties. Its Mid-Hudson region covers subscribers in Dutchess, Orange, Putnam, Sullivan and Ulster Counties, while its Albany region covers subscribers in Albany, Clinton, Columbia, Delaware, Essex, Fulton, Greene, Montgomery, Rensselaer, Saratoga, Schenectady, Schoharie, Warren and Washington Counties.