New York State
Insurance Department

            Superintendent Neil D. Levin today announced that the he has directed MVP Health Plan to take action to correct inaccurate policyholder information regarding its January 1^st rates for members. The Department learned that MVP Health Plan sent a letter to its CompCare members informing them that their rates were increasing effective January 1, 2000.

            "This is a clear violation of Department policy and will not be tolerated," said Levin. "We will continue to protect consumers by taking quick action against insurers that fail to comply with our insurance laws and regulations."

            MVP Health Plan applied for a rate increase for its CompCare members to be effective January 1, 2000, and the Department held public hearings in November regarding this proposal. However, Department policy prohibits insurers from implementing requested rate adjustments before the Department has made a final determination on the application. This policy eliminates confusion for consumers over what the rate increase will be as of January 1^st.

            MVP Health Plan, headquartered in Schenectady, NY, has taken immediate steps to correct the error and to provide its members with accurate billing information and correspondence that fully complies with state laws and regulations. Senator William J. Larkin (R-C, Cornwall-on-Hudson), upon receiving information from MVP policyholders in his area, contacted the Insurance Department about MVP’s noncompliance.

            The corrective measures required by the Department include:

• MVP has intercepted the issuance of Year 2000 billing statements for CompCare members. CompCare members will  not receive incorrect billing statements;

• MVP is preparing new billing statements that will reflect current, approved premium rates;

• MVP is preparing new notification letters to advise CompCare members that they will not be billed at new rates unless and until such rates are approved by the Department and all other regulatory requirements have been met; and

• MVP will send new letters to those who received the incorrect letters.

            MVP has also agreed to take further corrective action directed by the Department to fully resolve this situation if necessary. The Department will monitor MVP’s progress on implementing these corrective measures.