Health insurers and health maintenance organizations might need help from state lawmakers to get into the health savings account market in New York state.[@@]

The law that governs the HSA market requires holders who want health insurance to combine the HSAs with high-deductible health insurance.

New York state laws let group health insurers sell HSA-compatible health coverage, but the laws governing the individual market appear to forbid health insurers from selling comprehensive, high-deductible individual health policies, Thomas Fusco, an attorney in the health bureau at the New York State Insurance Department, writes in Circular Letter Number 4.

State laws also appear to forbid HMOs from selling either group or individual HSA-compatible coverage, Fusco warns.

New York state insurance laws now prohibit for-profit and nonprofit health insurers “from offering major medical, comprehensive or other comparable individual contracts on a direct-payment basis, unless the benefits are identical to the benefits contained in the standardized individual direct-pay contracts” described in Section 4322 of New York state’s insurance laws, Fusco writes.

Insurers might be able to sell some kinds of insurance policies that would be compatible with HSAs, but the policies could not provide major medical coverage, comprehensive coverage or comparable benefits, Fusco writes.

A separate law governs New York’s HMOs. The HMOs cannot offer high-deductible coverage because “they are prohibited from imposing deductibles on in-network benefits,” Fusco writes.

New York department officials are talking with officials at the New York Department of Health to see if HMOs could sell HSA-compatible coverage under limited circumstances, Fusco writes.

The New York department has posted the circular letter on the Web at http://www.ins.state.ny.us/cl04_04.htm