Statement on Decision of Kaiser Permanente to Leave New York and Its Northeast Market
Albany, June 18 – The New York State Department of Health has been notified by Kaiser Permanente, a managed care organization licensed under Article 43 of New York State Insurance Law and Article 44 of New York State Public Health Law, that it intends to cease operation in New York and three neighboring states by December 31, 1999.
The Department was notified yesterday by the company of its decision.
The State Health Department will work with Kaiser Permanente to effect a smooth transition for the plan's 285,000 enrollees in New York State, and to ensure that they continue to have access to care. Ideally, Kaiser's provider network will continue to be available to Kaiser members after the transition period, through provider contracts with other insurers or acquisition of the company's provider network by another health plan.
Kaiser Pemanente has been a quality provider of managed care in New York State, and we expect that the company's commitment to its members will continue through the transition period. Currently, Kaiser is working with the providers who staff its health clinics to form independent provider groups which will be able to contract with other health plans.
The State Health Department, along with the State Insurance Department, must approve any proposed transaction for transfer of Kaiser Permanente's New York assets to another managed care organization. Among the factors the Department will review before approving a sale is whether there would continue to be sufficient provider network capacity for current Kaiser enrollees under the new health plan.