Cuomo Bill Seeks to Establish New Health Benefit Exchange

Proposed Legislation Would Set Up Health Insurance Exchange to Comply with Federal Health Care Law

Governor Andrew Cuomo has submitted a Governor's program bill that would establish a new Health Benefit Exchange in order to comply with the Affordable Care Act passed by Congress and signed into law by President Barack Obama in 2010.

New York will operate its own exchange, rather than have the federal government operate one for the state, given the complexity and diversity of the insurance market in New York.

"This legislation would fulfill New York's commitment to the federal government to set up a health benefit exchange that will enhance access to affordable quality health care for all New Yorkers," Governor Cuomo said.

"This is a dynamic and flexible proposal that will protect consumers and help bring down the cost of health care for families, businesses, and taxpayers."

The purpose of this legislation is to establish a single Exchange in New York – a centralized, customer-service oriented marketplace where individuals and small groups will be able to purchase qualified health plans, receive eligibility and subsidy determinations, and be enrolled in a range of coverage options, including public health coverage programs.

The Exchange will be established as a public benefit corporation managed by a Board of Directors. Four of the seven members of the Board will have expertise in relevant areas, including individual health care coverage, small employer health care coverage, health benefits administration, health care finance, public or private health care delivery systems, and purchasing health plan coverage.

The Superintendent of Insurance (or after October 3, 2011, the Superintendent of the Department of Financial Services), the Commissioner of Health, and the State Medicaid Director will serve as ex officio members of the board.

The Board will consult with an Advisory Committee, comprised of 18 representatives of stakeholders and sectors that will be impacted by the operation of the Exchange, including health care consumers, small businesses, the medical community, and insurers.

The Committee's advice to the Board will reflect findings about regional variations regarding the availability of health insurance coverage and other issues deemed necessary by the Committee and the Board.

The Exchange will make available health plans, including certain qualified dental plans, to individuals and employers beginning on or before January 1, 2014.

Under this legislation, the Exchange will establish the minimum requirements an insurer shall meet to be considered for participation in the Exchange and will implement procedures for the certification, recertification, and decertification of health plans as qualified health plans.

The Exchange will also assign ratings to qualified health plans offered through the Exchange on the basis of relative quality and price, in accordance with the ACA.

The bill also provides critical protections meant to assist individuals in using the Exchange. For example, the bill provides that the Exchange will operate a toll-free telephone line to assist consumers and an Internet website containing standardized comparative information on qualified health plans.

The website will also feature a calculator allowing individuals to determine the actual cost of coverage. The bill also requires the Exchange to establish a program to award grants to entities to serve as "navigators" to help educate consumers and facilitate enrollment.

In addition, the Exchange will include a Small Business Health Options Program (SHOP), which will assist small employers in facilitating the enrollment of their employees in qualified health plans offered in the group market.

While the ACA requires each Exchange to be "self-sustaining" by January 1, 2015, federal funds will support the planning, implementation, and operation of the Exchange through December 2014. New York has already been selected to receive funding under an Early Innovator Grant ($27 million) and an Exchange Planning Grant ($1 million).

In June, the New York State Department of Health expects to apply for a Level 1 Establishment Grant, which makes a year's worth of funding available to states that have made some progress under their Exchange Planning Grant.

With the enactment of this legislation, assuming other applicable criteria are met, New York will qualify to apply for additional federal funding to support Exchange planning and establishment through December 31, 2014.

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Governor Cuomo's SAGE Commission Members Announced

Agency Expected to Completely Transform State Government and Stress Accountability

Governor Andrew Cuomo has named members of the Spending and Government Efficiency (SAGE) Commission to modernize and right-size state government, improve performance, increase accountability and save taxpayers' money.

The governor proposed SAGE in January and it was recently passed in the state budget. SAGE is the first major redesign of state government since Governor Alfred E. Smith in 1927.

Cuomo named Antonio M. Perez, Chairman and Chief Executive Officer of Eastman Kodak Company, to serve as Co-Chair of SAGE with Paul Francis, the Director of Agency Redesign and Efficiency.

"For decades, our state government has ballooned, evolving into the sprawling and inefficient bureaucracy we have today," Governor Cuomo said.

"It is time to consolidate the web of state agencies, authorities, and commissions that have overlapping functions and missions and to make the remaining ones perform better and more efficiently. Antonio's business acumen and experience with best practices in the private sector will help us create a leaner state government that performs better for the people of New York."

Antonio M. Perez, Chairman and Chief Executive Officer of Eastman Kodak Company said, "Improving the performance of state government has been one of Governor Cuomo's highest priorities, and I am honored to be part of the team that will make it a reality. Kodak began in New York, and continues to be headquartered in Rochester. We are transforming our company as we adapt to a new digital world. New York State government must also adapt to reflect current fiscal realities and take advantage of new technologies and ways of operating so that it can efficiently and effectively provide critical government services."

The Cuomo administration is working with SUNY's Rockefeller Institute, which had received a grant for this purpose from the Rockefeller Foundation, and management consultants from McKinsey & Co. to redesign state government.

"I want to thank the Rockefeller Foundation and its President Judith Rodin, as well as our own Rockefeller Institute, for their generous support of this important effort," Governor Cuomo continued.

The SAGE Commission will conduct a comprehensive review of state government including its structures, operations and processes, with the ultimate goal of saving taxpayers' money, increasing accountability and improving the delivery of government services. The Commission's final recommendations to the Governor will be delivered by June 1, 2012. Periodic progress reports will be delivered on an ongoing basis.

With the passage of the 2011-2012 budget, the state has already begun the process of consolidating a number of state agencies, including: Merging Correctional Services and Parole to create the new Department of Corrections and Community Supervision; Merging Banking and Insurance Departments to create the new Department of Financial Regulation; Merging the Foundation for Science, Technology and Innovation (NYSTAR) into the Empire State Development Corporation

The members of Governor Cuomo's SAGE Commission list as follows:

Co-Chair Antonio M. Perez, Chairman and Chief Executive Officer of Eastman Kodak Company: Since 2003, Perez has led a transformation from a film-based business to one based on digital technologies. Prior to that, he served 25 years at Hewlett-Packard, where he was a corporate vice president and a member of the company's Executive Council. Perez was also President and CEO of Gemplus International, where he led the effort to take the company public. Perez also serves on President Obama's Jobs and Competitiveness Council, which is responsible for promoting economic growth and job creation in the U.S.


Michael Balboni, Principal and Senior Vice President of the Cardinal Point Strategies Government Solutions Group: Former Assemblyman and state Senator Michael Balboni is an 18-year veteran of both houses of the New York State Legislature, with extensive experience in security and law enforcement matters. In 2006, he was appointed Deputy Secretary of Public Safety, where he was responsible for homeland security affairs, emergency preparedness and response and law enforcement for New York state. In 2009, Balboni joined Cardinal Point Strategies, which advises local, county and state governments across the country in matters involving homeland security and preparedness.


Neil Cole, CEO of Iconix Brand Group, Inc.: Neil Cole has served at Iconix as Chairman of the Board and as the Chief Executive Officer and President since Iconix's public offering in February 1993. In 2001, Mr. Cole founded The Candie's Foundation, for the purpose of educating teenagers as to the risks and consequences of teen pregnancy.


Jim Corcoran, President and founder of James P. Corcoran, LLC: Jim Corcoran is the President and founder of James P. Corcoran, LLC, a private arbitration firm. He was previously a partner at Winston and Strawn and Executive Vice President of Government and Industry Relations at American General Corporation. Corcoran served in Governor Mario Cuomo's administration as the Superintendent of Insurance for the State of New York from 1983 to 1990.


Cheryl Cohen Effron, Vice Chair of Wildcat Service Corporation: Cheryl Cohen Effron's current company, Wildcat Service Corporation, was the first organization in the U.S. to design and implement a transitional work program for unemployed people with criminal convictions. Effron has also managed and developed more than 4 million square feet of space in buildings housing more than 100 small and medium-sized businesses. She has been a trustee of the Brookings Institution, the New School, the Citizens Budget Commission and New York Cares.


Cheryl A. Felice, President of the Suffolk County Association of Municipal Employees (AME): Cheryl Felice is President of the Suffolk County Association of Municipal Employees (AME), which represents over 8,500 active and over 4,000 retired Suffolk County municipal workers. Cheryl was elected to the office of President in July of 2003 and also serves as Chair of the Suffolk County Municipal Employees Benefit Fund. She was the first and only AME President to serve as Chair of the Employee Medical Health Plan of Suffolk (EMHP) covering over 20,000 members and their 27,000 dependents.


Alan Gerry, Chairman and CEO, Granite Associates, LP: Alan Gerry is chairman and CEO of Granite Associates LP, a venture capital firm focused on emerging technologies, and chairman of the Gerry Foundation, a nonprofit organization dedicated to the economic revitalization of Sullivan County, NY. A pioneering entrepreneur in the cable television industry, Mr. Gerry was the founder, chairman and chief executive officer of Cablevision Industries Corporation (CVI), one of the nation's largest privately owned cable companies. Before being sold to Time Warner in 1996, CVI operated 64 cable systems across 18 states, serving more than 1.3 million subscribers.


Barry M. Gosin, Chief Executive Officer of Newmark & Company Real Estate, Inc.: Gosin has served as a Principal of Newmark & Company Real Estate, Inc. since 1978 and serves as Senior Executive on the Leasing team for Mitsui Fudosan (New York), Newmark. He is responsible for leasing more than 30 million square feet of commercial space in some of the largest and most innovative transactions in New York City history, including the North Shore-Long Island Jewish Health System and KeySpan Energy. Gosin is a trustee of the Citizens Budget Commission and Pace University and has served on a variety of real estate and business-oriented boards.


Denis M. Hughes, President of the New York State AFL-CIO: Dennis Hughes has served as president of the 2.5 million member New York State AFL-CIO since 1999 and has been a union member since 1968. Major achievements under his tenure include reforming the state's workers' compensation system, enacting a minimum wage for farm workers, and coordination of labor's efforts to pass the James Zadroga 9/11 Health Care and Compensation Act. He is a current Commissioner of the New York State Insurance Fund, served on the New York State Commission on State Asset Maximization, and is a former member of the Board of Directors of the Federal Reserve Bank of New York.


Derek Q. Johnson, CEO of Integrated Holdings Corp: Derek Johnson leads Integrated Holdings Corporation, a New York Development company. Previously, Johnson was president of the Apollo Theater from 2000 to 2002, Deputy Manhattan Borough Chief from 1990 to 1997 and Vice President of Time Warner from 1994 to 2000. Johnson, an attorney, began his career in 1985 at the law firm of Barrett Smith Schapiro Simon & Armstrong.


Simone Levinson, Member of the Board of Trustees and Chair of Media and Communications of Turnaround for Children: Simone Levinson is an education reformer who serves on the Board of Trustees and as Chair of Media and Communications of Turnaround for Children, an organization that has worked with over 60 of New York City's lowest performing schools and, with a minimal investment per child, produces extraordinary, measureable improvements. A life-long New York resident, Levinson previously ran Martel Productions, her own successful event marketing firm for over 10 years.


Anthony E. Malkin, Malkin Holdings: Anthony Malkin is president of Malkin Holdings and of its affiliates, including W&H Properties. Altogether, these firms comprise the real estate acquisition, management, construction and marketing arm of the Malkin family, which has been active in real estate for four generations. Through his real estate business, Malkin has been a leader in existing building energy efficiency retrofits including a groundbreaking project at the Empire State Building.


Lillian Rodríguez López, President of the Hispanic Federation: Lillian Rodríguez López serves as President of the Hispanic Federation, a non-profit membership organization serving close to 100 Latino health and human service agencies in New York, New Jersey, Connecticut and Pennsylvania. Prior to joining the Hispanic Federation, Rodríguez López was employed at the New York City Health and Hospitals Corporation (HHC), a public benefit corporation which oversees New York City's public health care system, in several capacities including Executive Assistant to the Chairman of the Board of Directors.


Kevin P. Ryan, Founder and CEO of Gilt Group: Kevin Ryan is the founder and CEO of Gilt.com, a leading Internet retailer of fashion apparel. Ryan is one of the leading Internet entrepreneurs in the United States having founded several New York-based businesses. He helped build DoubleClick from 1996 to 2005, first as President and later as CEO. He fostered DoubleClick's growth from a 20-person startup to a global leader with over 1,500 employees.


Jonathan Sandelman, Managing Partner of Mercer Park, LP: Jonathan Sandelman is the Managing Partner of Mercer Park, LP, a private investment management firm in New York City. He was previously the Chief Executive Officer, Founder, and Chief Investment Officer at Sandelman Partners, LP, a firm he founded in 2005. Sandelman was the President of the New York Office at Banc of America Securities LLC. Sandelman joined Banc of America Securities in 1998 as the Head of Equity Financial Products and took charge of the equity department in 2002. He headed the firm's debt and equities business before becoming the President.


Robert Samson, General Manager of IBM's Global Public Sector (Retired): Robert (Bob) Samson was General Manager of IBM's Global Public Sector responsible for IBM's business with governments, education, healthcare and life sciences industries. He led teams focused on helping governments transform using innovative approaches and technologies. In August 2009, Robert retired from IBM after 36 years.


Peter J. Solomon, Founder and Chairman, Peter J. Solomon Company, L.P.: Solomon founded his investment banking advisory firm in 1989. Previously, he was Vice Chairman of Lehman Brothers where he was Chairman of its Merchant Banking Division and Co-Chairman of the Investment Banking Division. Solomon was Deputy Mayor of Economic Policy and Development in New York City under Mayor Edward I. Koch. He was also Chairman of the New York City Health and Hospital Corporation, which operated 17 municipal hospitals.


Andrew J. Spano, Former Westchester County Executive: For 12 years Andrew Spano ran a county government with a $2 billion budget and 5,500 employees. During that time Westchester developed a national and international reputation as a model for the use of technology, the preservation of the environment and the efficiency of government operations. Prior to elective office, Spano worked for 25 years as a teacher, counselor, and administrator in New York City and Westchester Schools.


Max Stier, President of the Partnership for Public Service: Stier's Washington, D.C.-based organization works to inspire new talent to join federal service, from new college graduates to seasoned workers seeking encore careers. The Partnership for Public Service also works with government leaders to help transform government so that the best and brightest will enter, stay and succeed in meeting the challenges of the nation.


Robert Zimmerman, Partner and Founder of Zimmerman/Edelson Inc.: Robert Zimmerman is a partner and founder of Long Island based, Zimmerman/Edelson Inc., a leading public relations, advertising and marketing firm. He has served on the New York State Commission on Open Government and was appointed by Governor Mario Cuomo to the Long Island Economic Development Council. Additionally, he has worked for Congressmen Lester L. Wolff and James Scheuer, and as Special Assistant to the Speaker of the New York State Assembly Mel Miller.

Senator Greg Ball, Senator Liz Kruger, and Assemblywoman Jane Corwin have already been named as legislative representatives on the SAGE Commission. Assemblywoman RoAnn Destito was also named but will be replaced given her nomination as Commissioner of the Office of General Services.