This report originally appeared in the January 2010 issue of DOTmed Business News.

New York State Senator Eric T. Schneiderman has introduced Ian's Law (S.6263), major legislation to protect patients from wrongful insurance practices. The legislation would outlaw insurers dropping entire classes of insurance as a pretext to deny coverage to individual policyholders and require insurance companies to obtain prior approval from the State Insurance Department before discontinuing a class of insurance. Policyholders with total disabilities would receive continued coverage for 18 months after losing their policy.

The bill is named for Ian Pearl, a 37-year-old man with muscular dystrophy. Peal lost his insurance after a company acting under New York law terminated an entire class of policies under which Ian and others were covered. The text of the legislation states insurers will be required to prove dropping a line of coverage is not a pretext to discontinuing the coverage of any policyholder due to the claims experience or health status-related factor of a policyholder (i.e., a policyholder whose care becomes expensive). Before being allowed to drop coverage, the company must notify impacted policyholders, and demonstrate to the Insurance Department the claims and premium rates for each class policy. Policyholders would be allowed to submit comments to the Superintendent of the Department regarding the action.

"The practice of terminating an insurance policy line as a pretext to dropping coverage for individuals who need it most is not only absolutely disgraceful - it's a matter of life and death," said Sen. Schneiderman in a press release on his web site. "This bill holds the insurance industry accountable and protects patients like Ian - and other individuals who have paid for insurance coverage - from being thrown off when they get sick."

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