New York State
New York, September 9, 1998
STATE DISTRIBUTES $9.5 MILLION TO EMPIRE, UNITED HEALTHCARE AND OTHER CARRIERS TO REDUCE RATES FOR SENIORS
Plan Will Immediately Yield a 2% Rate Cut for Empire Customers
Superintendent of Insurance Neil D. Levin today announced that he has ordered the distribution of $9.5 million to the States Medicare supplement carriers in a continuing effort to curb the increasing health care costs for senior citizens in New York State. These funds will go directly towards reducing the premium rates for seniors with existing Medicare supplemental contracts.
"This is further proof that New York continues to lead the nation in the effort to drive down the health care costs for families while still providing high quality care," said Governor Pataki. "These funds will go directly into the pockets of seniors, who cannot afford an increase in their monthly health insurance rates."
The State and Empire Blue Cross and Blue Shield have agreed to use its $4.9 million allocation to immediately reduce rates by 2 percent for all seniors who have Medicare Supplemental contracts. In addition, Empire has agreed to freeze rates on these contracts for one year, protecting seniors from any rate increases on their existing contracts until October 1999. The second largest disbursement of $2.9 million will be paid to United Healthcare Insurance Company of New York.
"Once again, we are able to proactively prevent rate increases for health care consumers in New York State," said New York State Superintendent Neil D. Levin. "Thanks to Governor Patakis leadership, we have requested that these health care companies use these surplus funds to help ease the burden on consumers."
Todays announcement builds on the more than $100 million that the State ordered to be distributed in April to New York insurers to offset rate increases. Part of those excess funds went toward preventing significant rate increases proposed by Oxford Health Plans and Empire Blue Cross and Blue Shield Healthnet for individual policyholders.
The $9.5 million distribution represents funds built up in the health insurance pools established by the Insurance Department and funded by Medicare supplement insurers to promote stability in the Medicare supplement marketplace. While these pools continue to make payments to certain carriers, there has been a surplus. In addition, with legislation passed in 1995, more funds have been made available for distribution at this time.