Four health insurers will pay $2.2 million in restitution to 3,475 New York seniors from across the state for overcharging them on insurance policies in violation of New York law.
The refunds, which are for Medicare supplemental insurance (commonly called “Medigap”) products, average $624 per policyholder. Distribution of the funds will begin on Sept. 30.
According to the announcement from Gov. Andrew Cuomo’s office, state law requires insurance companies to spend a minimum amount of premium dollars on medical costs in order to keep healthcare coverage affordable for consumers.
Benjamin Lawsky, Superintendent of Financial Services, ordered the refunds after a Department of Financial Services (DFS) investigation uncovered that the companies had failed to comply with New York laws that require insurers to spend a minimum amount of premium dollars on medical bills rather than on administrative expenses or excess profits.
The four insurers that are providing the refunds are American Progressive Life and Health Insurance Company of New York (White Plains), Excellus Health Plan, Inc. (Rochester), First United American Life Insurance Company (Liverpool), and Transamerica Financial Life Insurance Company (Harrison).
Policyholders that will be receiving restitution from these companies are located throughout the state.