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New York State Fines AXA Equitable $20 Million

"New York state's [Department of Financial Services (DFS)] fined the U.S. insurance unit of AXA SA $20 million, the state's largest penalty against an insurance company, for failing to adequately report changes in certain retirement-income contracts.... In its regulatory filings, according to the state, AXA Equitable 'failed to inform and adequately explain to DFS the significance of the changes caused by introduction and application' of a strategy designed to smooth funds' returns.... The company's omissions limited the state's ability to put in place consumer protections, according to DFS[.]"

New York Issues Final Life Insurance and Annuity Suitability and Best Interests Regulation Protecting Consumers from Conflicts of Interest

"[T]he New York State Department of Financial Services (DFS) has issued a final regulation ... [which] requires insurers to establish standards and procedures to supervise recommendations by agents and brokers to consumers with respect to life insurance policies and annuity contracts issued in New York State so that any transaction with respect to those policies is in the best interest of the consumer and appropriately addresses the insurance needs and financial objectives of the consumer at the time of the transaction."

New York Regulations Promote Network Adequacy for Mental Health Services

"The New York State Department of Financial Services (DFS) and the Department of Health (DOH) have recently adopted 'network adequacy' regulations requiring health plans to enhance access to mental health and substance use disorder services. ... [T]he DFS regulation applies to fully insured health insurance plans written in New York (while the mirrored DOH regulations apply to HMOs, including Medicaid managed care plans). These 'network adequacy' regulations do not apply to self-funded plans or fully insured plans issued outside of New York."

New York Issues Emergency Regulation to Address Impact of Federal Risk Adjustment Program on New York Health Insurers

"Under the new regulation, after CMS makes its 2017 risk adjustment program calculations, [the Department of Financial Services (DFS)] will determine if the CMS calculations will have an adverse impact on New York's small group health insurance marketplace. If there is an adverse impact, the Superintendent will implement a 'market stabilization pool' taking into account certain factors relevant to the New York market. Utilizing these additional factors, insurers who received money from the risk adjustment program will pay an allocable percentage of that money into a fund administered by DFS. DFS will then transfer that money to those insurers who paid into the risk adjustment program and were adversely impacted."

New York State Pension Fund Uses Obsolete Computer Technology

"The [New York] Department of Financial Services ... blasted the [New York] state pension fund for using obsolete technology and computer codes that date back to the 1950s to manage the retirement system. The antiquated equipment puts taxpayers and pensioners at 'significant risk,' officials said in the audit.... The audit revealed that the pension funds' information systems are no longer supported by their manufacturers and lack vital security patches. Additionally, pension fund officials admitted to the DFS auditors that the technology programs were 'approaching the point of failure'[.]"

New York Proposes Regs Governing Pharmacy Benefit Managers Operating in the State

"The Department is also inviting submissions of comments, data, or documented evidence from the public regarding network adequacy requirements, formulary changes, drug manufacturer rebates, and aberrant quantity/product list restrictions.... The regulations ... [1] Prohibit PBMs from barring any in-network pharmacies from providing mail order or delivery services ... [2] [Require] PBMs to list formularies and pharmacy directories online ... [3] Require PBMs to post a telephone number and email address for consumers[.]"

New York Expands Regulation of ‎Pharmacy Benefit Managers While ERISA ‎Preemption Remains ‎Uncertain

"PBMs operating in New York State must be licensed by DFS by January 1, 2024.... The new provisions significantly increase documentary and informational materials PBMs must submit to [the Department of Financial Services (DFS)], such as contracts, financials, governance, and ownership structure. Companies applying for licensure must also certify their compliance with DFS's cybersecurity regulation."

New York Imposes Extensive Behavioral Health Parity Compliance Rules

"On September 30, 2020, the New York State Department of Financial Services (DFS) and Department of Health (DOH) promulgated regulations requiring health insurers operating in the state to develop and implement a mental health and substance use disorder (MH/SUD) parity compliance program. Health plans are required to have these parity compliance programs in place by December 29, 2020, and must annually attest to the DFS or DOH that such programs are in place."

New York's Regulatory Failure and an Insurance CO-OP Collapse

"Health Republic's growing financial troubles should have been no surprise to insurance regulators at the Department of Financial Services (DFS). The company's filings to DFS showed steep operating losses, mounting debt, unanticipated costs and heavy reliance on a federal risk-management subsidy that failed to materialize. Yet the department did not intervene to order an increase in Health Republic's premiums, as other states did in similar situations. To the contrary, DFS repeatedly cut the company's premiums below what the insurer had requested, aggravating the co-op's losses."

Fiduciary Wake-Up Call: Cybersecurity and Your Vendors

"Recent guidance from both the [DOL] and the New York State Department of Financial Services (DFS) underscores the importance of due diligence and ongoing oversight of ... third-party administrators (TPAs), carriers, and technology platforms ... Outsourcing the administration does not absolve you of your fiduciary duty.... Here's a checklist to guide your due diligence related to cybersecurity."