§ 4705 — Municipal cooperation agreements

§ 4705. Municipal cooperation agreements. (a) The municipal\ncooperation agreement, under which the municipal cooperative health\nbenefit plan is established and maintained, and any amendment thereto,\nshall be approved by each participating municipal corporation by\nmajority vote of each such corporation's governing body, and shall:\n (1) specify all municipal corporations participating in the municipal\ncooperative health benefit plan and describe the form or type of\nmunicipal corporations eligible for participation;\n (2) state that all participating municipal corporations agree to share\nthe costs of and assume the liabilities for medical, surgical and\nhospital benefits provided under the municipal cooperative health\nbenefit plan to the covered employees (including retirees) and their\ndependents of all participating municipal corporations;\n (3) state that each participating municipal corporation agrees to pay\non demand such municipal corporation's share of any assessment ordered\nby the governing board of the municipal cooperative health benefit plan\nor by the superintendent under this article or article seventy-four of\nthis chapter;\n (4) specify the eligibility requirements for membership in and\ncoverage by the municipal cooperative health benefit plan, including\nreasonable geographic boundaries (if any) of such plan, provided that no\nmunicipal cooperation agreement shall include any provision restricting\nor otherwise limiting the right to participate in the plan of a\nmunicipal corporation of the same type which provides satisfactory proof\nof its financial responsibility and which is located within the\ngeographic region in which the municipal cooperative health benefit plan\noperates;\n (5) not include any provision restricting or otherwise limiting the\nright of eligible employees (including retirees and dependents) of a\nparticipating municipal corporation to enroll for coverage in the plan;\n (6) designate the fiscal officer of a participating municipal\ncorporation to be the chief fiscal officer of the municipal cooperative\nhealth benefit plan;\n (7) designate the plan's attorney-in-fact to receive service of\nsummons or other legal process in any action, suit or proceeding arising\nout of any contract, agreement or transaction involving such municipal\ncooperative health benefit plan; and\n (8) establish a governing board to be responsible for the management,\ncontrol and administration of the municipal cooperative health benefit\nplan, provided any municipal cooperative agreement to establish such a\nplan which is entered into after the effective date of this article\nshall provide that unions which are the exclusive collective bargaining\nrepresentatives of employees who are covered by such health benefit plan\nshall be entitled to representation on such governing board.\n (b) The municipal cooperation agreement shall provide that the plan's\nchief fiscal officer:\n (1) shall have custody of all moneys received by the municipal\ncooperative health benefit plan or made available for expenditure under\nthe plan;\n (2) shall, notwithstanding any provision of the general municipal law,\nmake payment in accordance with procedures developed by the plan's\ngoverning board and acceptable to the superintendent;\n (3) may invest moneys not required for immediate expenditure in the\ntypes of investment specified in the general municipal law or the\neducation law (as applicable) for temporary investments or as otherwise\nexpressly permitted by the superintendent; and\n (4) shall receive no remuneration, except that the participating\nmunicipal corporation employing the chief fiscal officer may be\nreimbursed for reasonable expenses incurred in connection with the\nduties of such fiscal officer in connection with the plan.\n (c) A municipal cooperation agreement shall include a provision:\n (1) describing the composition, number and procedures under which\ngoverning board members are chosen, provided that, for those agreements\nentered into after the effective date of this article, the governing\nboard shall include representation by unions which are the exclusive\ncollective bargaining representatives of employees covered by the plan,\nand that such unions shall establish and agree to the procedures by\nwhich the member or members of the governing board which represent\nunions are selected;\n (2) designating one governing board member to have custody of all\nreports, statements and other documents of the plan; and\n (3) that the governing board shall meet at least annually at a time\nand place in this state designated in accordance with the agreement.\n (d) The municipal cooperation agreement shall provide that the\ngoverning board:\n (1) shall design the plan of benefits provided by the municipal\ncooperative health benefit plan and prepare the plan document and\nsummary plan description in accordance with section four thousand seven\nhundred nine of this article;\n (2) may enter into an agreement with a contract administrator or other\nservice provider, determined by the governing board to be qualified, to\nreceive, investigate, recommend, audit, approve or make payment of\nclaims under the municipal cooperative health benefit plan, provided\nthat:\n (A) the charges, fees and other compensation for any contracted\nservices shall be clearly stated in written administrative services\ncontracts as required in subdivision six of section ninety-two-a of the\ngeneral municipal law;\n (B) payment for contracted services shall be made only after such\nservices are rendered;\n (C) no member of the plan's governing board or any member of such\nmember's immediate family shall be an owner, officer, director, partner,\nor employee of any contract administrator retained by the plan; and\n (D) all such agreements shall comply with the requirements of\nsubdivision six of section ninety-two-a of the general municipal law.\n (3) shall be authorized to purchase stop-loss insurance, to the extent\nrequired by section four thousand seven hundred seven of this article,\non behalf of the municipal cooperative health benefit plan;\n (4) shall be authorized to establish a joint fund or funds to finance\nall plan expenditures, including claims, reserves, surplus,\nadministration, stop-loss insurance and other expenses;\n (5) shall prepare an annual budget for the municipal cooperative\nhealth benefit plan to determine the premium equivalent rates for\nparticipating municipal corporations to be deposited in the plan's joint\nfund or funds during the fiscal year, provided that:\n (A) the governing board shall designate the bank or trust company in\nwhich joint funds, including reserve funds, are to be deposited and\nwhich shall be located in this state, duly chartered under federal law\nor the laws of this state; and\n (B) the governing board shall establish premium equivalent rates for\nparticipating municipal corporations on the bases of a community rating\nmethodology filed with and approved by the superintendent and, in\ndetermining the annual premium equivalent rates, the governing board:\n (i) may contract for necessary actuarial services to estimate expected\nplan expenditures during the fiscal year;\n (ii) shall maintain reserves in amounts equal to or exceeding the\nminimum amounts required by section four thousand seven hundred six of\nthis article; and\n (iii) shall maintain a stop-loss policy or policies, to the extent\nrequired by section four thousand seven hundred seven of this article;\n (6) shall be authorized to assess participating municipal corporations\nfor additional contributions, if actual losses due to benefits paid out,\nadministrative expenses and reserve and surplus requirements exceed\namounts held in the plan's joint funds; and\n (7) shall be authorized to refund amounts in excess of reserves and\nsurplus required by section four thousand seven hundred six of this\narticle and anticipated expenses in the plan's joint funds to\nparticipating municipal corporations, or to retain such excess amounts\nor a portion thereof and apply such amounts in preparing the plan's\nbudget for the following year.\n (e) The municipal cooperation agreement shall provide for the\nfollowing to be prepared and furnished to the governing board, to\nparticipating municipal corporations, to unions which are the exclusive\nbargaining representatives of employees covered by the plan and to the\nsuperintendent:\n (1) an annual audit, and opinions thereon, by an independent certified\npublic accountant, of the financial condition, accounting procedures and\ninternal control systems of the municipal cooperative health benefit\nplan;\n (2) an annual report and quarterly reports describing the plan's\ncurrent financial status; and\n (3) an annual independent actuarial opinion on the financial soundness\nof the plan, including the actuarial soundness of contribution or\npremium equivalent rates and reserves, both as paid in the current year\nand projected for the next fiscal year.\n (f) The municipal cooperation agreement shall specify the rights and\nobligations of a municipal corporation withdrawing from a municipal\ncooperative health benefit plan to any contribution (or premium\nequivalent) refund or reserve fund or for any contingent assessment\nliability or other obligation.\n (g) Every municipal cooperation agreement shall contain a provision\nstating that nothing contained in such agreement shall be construed to\nwaive any right a covered person possesses with respect to the\nconfidentiality of medical records and that such right may only be\nwaived upon the written consent of such covered person.\n