Client Alert

| February 23, 2012

New York to Conduct On-Site Health Insurance Rate Audits

New York Superintendent of Financial Services Benjamin Lawsky has announced that the Department of Financial Services (DFS) will conduct “a wide-ranging probe of the accuracy of the data used by insurers and health maintenance organizations . . . to request health insurance rate increases.” In announcing the audits, the DFS reported the audits will be funded under a $4.4 million grant won by the Department in September from the U.S. Department of Health and Human Services. The grant was among those issued to a number of states to enhance premium rate review, improve public access and lend more transparency to the processes used to establish health insurance premiums. Part of the federal funding will go to a private accounting firm that will work with DFS personnel to conduct on-site audits. The audits will scrutinize “claims, insurer administrative expenses, premiums and claims reserves.”

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