DFS Fines Oxford Health $1 Million for New York Insurance Law Violations

DFS Fines Oxford Health $1 Million for New York Insurance Law Violations

Oxford Improperly Paid Compensation to an Unlicensed Producer and Failed to Adhere to Established Customer Standards

Company Failed to Acknowledge Grievances and Send Adverse Determination Notices within Required Timeframes

New York State Department of Financial Services Superintendent Maria T. Vullo announced today that Oxford Health Plans (NY) Inc. and Oxford Health Insurance, Inc. have been fined $1 million by the Department of Financial Services (DFS) for improper payments to an unlicensed producer and for failing to respond to consumer grievances within required timeframes in violation of New York State Insurance Law.

"Insurance companies operating in New York must comply with all laws, and DFS will ensure that they do so in our market conduct examinations and investigations,” said Superintendent Vullo. “Consumers are entitled to trust that their health insurers will respond to their complaints in a timely manner. DFS is pleased that Oxford has cooperated with us to resolve this issue in a responsible manner."

A market conduct examination by DFS found that between 2009 and 2013, Oxford Health Plans (NY) improperly paid compensation to an unlicensed producer.  Producers must be licensed as an agent or broker in New York State, under the Insurance Law.   The DFS examination also found that Oxford Health Insurance failed to acknowledge insureds’ grievances within 15 business days and failed to send initial adverse determination notices as well as adverse appeal determination letters to insureds as mandated by New York Insurance Law.

DFS’s market conduct examination found that in almost one-third of the cases sampled, the company failed to acknowledge consumer grievances within the required 15-day time frame; it also did not resolve grievance cases regarding referrals or benefit coverage within 30 days; and, in 44% of additional cases sampled, the company failed to issue initial adverse determination letters or adverse determination letters following an appeal within the 30 days mandated by law.

Under the consent order, Oxford has agreed to take all steps necessary to comply with New York State Insurance Law and Regulations moving forward, and to correct all violations.

The direct parent of Oxford Health Plans (NY) Inc. and Oxford Health Insurance, Inc. is Oxford Health Plans LLC. UnitedHealth Group Inc. is the parent company of Oxford Health Plans LLC.

A copy of the consent order between Oxford Health and DFS can be found here.

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