Chapter
05-043
2005 -- H 5100 SUBSTITUTE A AS AMENDED
Enacted 06/16/05
A N A C T
RELATING TO INSURANCE --
MEDICARE SUPPLEMENT INSURANCE
Introduced By: Representatives E Coderre, Kennedy, San Bento, Costantino, and McNamara
Date
Introduced: January 13, 2005
It is enacted by the General
Assembly as follows:
SECTION
1. Section 27-18.2-3 of the General Laws in Chapter 27-18.2 entitled
"Medicare
Supplement Insurance Policies" is hereby amended to read as follows:
27-18.2-3.
Standards for policy provisions. -- (a) No Medicare supplement
insurance
policy
or certificate in force in the state shall contain benefits which duplicate
benefits provided
by
Medicare.
(b) Notwithstanding any other provision of law of this state, a Medicare
supplement
policy
or certificate shall not exclude or limit benefits for loss incurred more than
six (6) months
from the
effective date of coverage because it involved a preexisting condition. The
policy or
certificate
shall not define a preexisting condition more restrictively than a condition
for which
medical
advice was given or treatment was recommended by or received from a physician
within
six (6)
months before the effective date of coverage.
(c) The director shall adopt reasonable regulations to establish specific
standards for
policy
provisions of Medicare supplement policies and certificates. Those standards
shall be in
addition
to and in accordance with the applicable laws of this state, including but not
limited to
sections
27-18-3(a) and 42-62-12 and regulations promulgated pursuant to those sections.
No
requirement
of this title or chapter 62 of title 42 relating to minimum required policy
benefits,
other
than the minimum standards contained in this chapter, shall apply to Medicare
supplement
policies
and certificates. The standards may cover, but not be limited to:
(1) Terms of renewability;
(2) Initial and subsequent conditions of eligibility;
(3) Nonduplication of coverage;
(4) Probationary periods;
(5) Benefit limitations, exceptions, and reductions;
(6) Elimination periods;
(7) Requirements for replacement;
(8) Recurrent conditions; and
(9) Definitions of terms.
(d) The director may adopt reasonable regulations that specify prohibited
policy
provisions
not specifically authorized by statute, if, in the opinion of the director,
those provisions
are
unjust, unfair, or unfairly discriminatory to any person insured or proposed to
be insured
under a
Medicare supplement policy or certificate.
(e) The director shall adopt reasonable regulations to establish minimum
standards for
benefits,
claims payment, marketing practices, and compensation arrangements and
reporting
practices
for Medicare supplement policies and certificates.
(f) The director may adopt any reasonable regulations necessary to conform
Medicare
supplement
policies and certificates to the requirements of federal law and regulations
promulgated
pursuant to federal law, including but not limited to:
(1) Requiring refunds or credits if the policies or certificates do not meet
loss ratio
requirements;
(2) Establishing a uniform methodology for calculating and reporting loss
ratios;
(3) Assuring public access to policies, premiums, and loss ratio information of
issuers of
Medicare
supplement insurance;
(4) Establishing a process for approving or disapproving policy forms and
certificate
forms
and proposed premium increases;
(5) Establishing a policy for holding public hearings prior to approval of
premium
increases
which may include, the applicant’s provision of notice of the proposed
premium
increase
to all subscribers subject to the proposed increase, at least ten (10) days
prior to the
hearing; and
(6) Establishing standards for Medicare select policies and certificates.
SECTION
2. Section 27-19-6 of the General Laws in Chapter 27-19 entitled
"Nonprofit
Hospital
Service Corporations" is hereby amended to read as follows:
27-19-6.
Rates charged subscribers -- Reserves. – (a) Public hearings:
The rates
proposed
to be charged or a rating formula proposed to be used by any corporation
organized
under
this chapter to its subscribers employers, the state or any political
subdivision of the state,
or
individuals shall be filed by the
corporation at the office of the director of business regulation
health
insurance commissioner. Within thirty
(30) sixty (60) days after receipt of the application,
the director
commissioner, or his or her designee shall hold a hearing on all
rates proposed for
health
insurance coverage offered in the individual market as defined in section
27-18.5-2 upon
not less
than ten (10) days written notice prior to the hearing. With regard to any
other rates or
rating
formula subject to the commissioner’s jurisdiction the commissioner or his or
her designee
may
hold a hearing upon not less than ten (10) days written notice prior to the
hearing. The
notice
shall be published by the commissioner in a newspaper or newspapers having
aggregate
general
circulation throughout the state at least ten (10) days prior to the hearing. The notice shall
contain
a description of the rates proposed to be charged and a copy of the notice
shall be sent to
the
applicant and to the department of the attorney general. At any hearing held
under this
section,
the applicant shall be required to establish that the rates proposed to be
charged to
subscribers
are consistent with the proper conduct of its business and with the interest of
the
public. In addition, the applicant shall provide by mail,
at least ten (10) days prior to the hearing,
notice
of a proposed rate increase for health insurance coverage offered in the
individual market
as
defined in section 27-18.5-2 to all subscribers subject to the proposed rate
increase.
(b)
Filings with the Attorney General's Office: The applicant shall provide a copy
of the
filing
on all rates proposed for health insurance coverage offered in the individual
market as
defined
in section 27-18.5-2 or for a Medicare supplement policy as defined in section
27-18.2-1
to
the Insurance Advocacy Unit of the Attorney General's Office simultaneously
with the filing at
the
office of the health insurance commissioner.
(c)
Procedures: At any hearing held under this section, the applicant shall be
required to
establish
that the rates proposed to be charged or the rating formula to be used are
consistent with
the
proper conduct of its business and with the interest of the public.
Rates
proposed to be charged by any corporation organized under this chapter shall be
sufficient
to maintain total reserves in a dollar amount sufficient to pay claims and
operating
expenses
for not less than one month. Those reserves shall be computed as of each
December
31st,
and a report setting forth the computation shall be submitted to the director
of the
department
of business regulation commissioner
together with the corporation's Rhode Island
annual
statement to the insurance commissioner. Any documents presented in
support of a filing
of
proposed rates under this section shall be made available for inspection by any
party entitled to
participate
in a hearing or admitted as an intervenor in a hearing or such conditions as
the
commissioner
may prescribe provided under this
section at a time and at a place as the director
commissioner may deem reasonable. The director commissioner
or his or her designee, upon the
hearing,
may administer oaths, examine and cross-examine witnesses, receive oral and
documentary
evidence, and shall have the power to subpoena witnesses, compel their
attendance,
and
require the production of books, papers, records, correspondence, or other
documents which
he or
she deems relevant. The director commissioner shall issue a
decision as soon as is
reasonably
possible following the completion of the hearing. The decision may approve,
disapprove,
or modify the rates proposed to be charged by the applicant. Applicants
requesting
changes
in rates shall underwrite the reasonable expenses of the commissioner in
connection with
the
hearing, including any costs related to advertisements, stenographic reporting
and expert
witnesses
fees.
(d)
The term “designee” as used in this section shall mean a person who is
impartial, a
member
in good standing of the Rhode Island bar and a person who is sufficiently
acquainted
with
the rules of evidence as used in the superior court of the state so as to
enable that person to
conduct
a hearing as designee of the commissioner. The reasonable per diem cost of the
designee
as
appointed by the commissioner shall be paid by the applicant requesting changes
in the rates.
SECTION
3. Section 27-20-6 of the General Laws in Chapter 27-20 entitled
"Nonprofit
Medical
Service Corporations" is hereby amended to read as follows:
27-20-6.
Rates charged subscribers -- Reserves -- Hearing by director. – (a)
Public
hearings: The rates proposed to be charged or a rating
formula proposed to be used by any
corporation
organized under this chapter to its subscribers, employers, the state or any
political
subdivision
of the state, or individuals shall be
filed by the corporation at the office of the director
of
business regulation health
insurance commissioner. Within thirty (30) sixty (60) days
after
receipt
of the application, the director commissioner, or his or her designee
shall hold a hearing
on
all rates proposed for health insurance coverage offered in the individual
market as defined in
section
27-18.5-2 upon not less than ten (10)
days written notice prior to the hearing. With regard
to
any other rates or rating formula subject to the commissioner's jurisdiction
the commissioner,
or
his or her designee may hold a hearing upon not less than ten (10) days written
notice prior to
the
hearing. The notice shall be published by the commissioner in a newspaper or
newspapers
having
aggregate general circulation throughout the state at least ten (10) days prior
to the
hearing. The notice shall contain a description of the rates
proposed to be charged and a copy of
the
notice shall be sent to the applicant and to the department of the attorney
general. At any
hearing
held pursuant to this section, the applicant shall be required to establish
that the rates
proposed
to be charged to subscribers are consistent with the proper conduct of its
business and
with
the interest of the public. In addition,
the applicant shall provide by mail, at least ten (10)
days
prior to the hearing, notice of a proposed rate increase for health insurance
coverage offered
in
the individual market as defined in section 27-18.5-2 to all subscribers
subject to the proposed
rate
increase.
(b)
Filings with the Attorney General's Office: The applicant shall provide a copy
of the
filing
on all rates proposed for health insurance coverage offered in the individual
market as
defined
in section 27-18.5-2 or for a Medicare supplement policy as defined in section
27-18.2-1
to
the Insurance Advocacy Unit of the Attorney General's Office simultaneously
with the filing at
the
office of the health insurance commissioner.
(c)
Procedures: At any hearing held under this section, the applicant shall be
required to
establish
that the rates proposed to be charged or the rating formula proposed to be used
are
consistent
with the proper conduct of its business and with the interest of the public.
Rates
proposed to be charged by any corporation organized under this chapter shall
maintain
total reserves in a dollar amount sufficient to pay claims and operating
expenses for not
less
than one month. Those reserves shall be computed as of each December 31st, and
a report
setting
forth the computation shall be submitted to the director of the department
of business
regulation commissioner together with the corporation's
Rhode Island annual statement to the
insurance commissioner of the state of Rhode Island. Any documents
presented in support of a
filing
of proposed rates under this section shall be made available for inspection by
any party
entitled
to participate in a hearing or admitted as an intervenor in a hearing on
such conditions as
the
commissioner may prescribe provided
pursuant to this section at a time and at a place as the
director commissioner may deem reasonable. The director
commissioner, or his or her designee,
upon the
hearing, may administer oaths, examine and cross examine witnesses, receive oral
and
documentary
evidence, and shall have the power to subpoena witnesses, compel their
attendance,
and
require the production of books, papers, records, correspondence, or other
documents which
the
director deems relevant. The director commissioner shall issue a
decision as soon as is
reasonably
possible following completion of the hearing. The decision may approve,
disapprove,
or
modify the rates proposed to be charged by the applicant. Applicants
requesting changes in
rates
shall underwrite the reasonable expenses of the commissioner in connection with
the
hearing,
including any costs related to advertisements, stenographic reporting, and
expert
witnesses
fees.
(d)
The term “designee” as used in this section shall mean a person who is
impartial, a
member
in good standing of the Rhode Island bar and a person who is sufficiently
acquainted
with
the rules of evidence as used in the superior court of the state so as to
enable that person to
conduct
a hearing as designee of the commissioner. The reasonable per diem cost of the
designee
as
appointed by the commissioner shall be paid by the applicant requesting changes
in the rates.
SECTION
4. Section 42-62-13 of the General Laws in Chapter 42-62 entitled
"Catastrophic
Health Insurance Plan Act" is hereby amended to read as follows:
42-62-13.
Rates charged. -- (a) The rates proposed to be charged or a rating
formula
proposed
to be used by any insurer or health maintenance organization under this section
to
employers,
the state or any political subdivision of the state, or individuals, shall be
filed by the
insurer
or health maintenance organization at the office of the director of business
regulation.
This
section does not apply to any entity subject to section 27-19-1 et seq., and/or
section 27-20-1
et
seq. The rates proposed to be charged by those entities shall be governed by
the provisions of
section
27-19-1 et seq., and/or section 27-20-1 et seq. A copy of the filing shall be provided
simultaneously
to the Insurance Advocacy Unit in the department of the attorney general. Within
sixty
(60) days after receipt of the application, the director, or the director's
designee, shall hold a
hearing
upon not less than ten (10) days' written notice whenever a proposed rate
exceeds the
consumer
price index (CPI) for medical care for the prior calendar year in which the
proposed
rate
increase is filed. If the proposed rate increase is less than the increase in
the consumer price
index
(CPI) for medical care for the prior calendar year in which the proposed rate
is filed, the
director may hold a hearing upon not less than ten (10) days'
written notice prior to the hearings.
These
provisions shall not apply to products offered in the small group or large group
market.
The
notice shall contain a description of the rates proposed to be charged and a
copy of the notice
shall be
sent to the applicant and to the consumer protection unit of the department of
attorney
general.
The notice shall also be published by the department in a newspaper or
newspapers
having
aggregate general circulation throughout the state at least ten (10) days prior
to the
hearing.
In addition, whenever the proposed rate increase exceeds the consumer price
index (CPI)
for
medical care for the prior calendar year in which the rate increase is filed,
the department shall
require
the applicant to notify by mail, at least ten (10) days prior to the hearing,
notice of the
proposed
rate increase to all subscribers subject to the proposed rate increase. At any hearing held
under
this section, the applicant shall be required to establish that the rates
proposed to be
charged
or the rating formula proposed to be used are consistent with the proper
conduct of its
business
and with the interest of the public. Any documents presented in support of a
filing of
proposed
rates under this section shall be made available for public examination at any
time and
place
that the director may deem reasonable. The director, or the director's
designee, upon that
hearing
may administer oaths, examine and cross-examine witnesses, receive oral and
documentary
evidence, and shall have the power to subpoena witnesses, compel their
attendance
and
require the production of all books, papers, records, correspondence, or other
documents
which he
or she deems relevant. Any designee who shall conduct a hearing pursuant to
this
section
shall report his or her findings in writing to the director within eighty (80)
days of the
filing
with a recommendation for approval, disapproval, or modification of the rates
proposed to
be
charged by the applicant. The recommended decision shall become part of the
record. The
director
shall make and issue a decision not later than ten (10) days following the
issuance of the
recommended
decision or, if the director hears the application without the appointment of a
designee,
as soon as is reasonably possible following the completion of the hearing on
the
proposed
rate change. The decision may approve, disapprove, or modify the rates proposed
to be
charged
by the applicant. Insurers requesting changes in rates shall underwrite the
reasonable
expenses
of the department of business regulation in connection with the hearing,
including any
costs
related to advertisements, stenographic reporting, and expert witnesses fees.
Notwithstanding
any other provisions of law, the filing of proposed rates or a rating formula
and
the
holding and conduct of any hearings in connection with these proposed rates or
rating formula
shall be
pursuant to this section.
(b) Whenever the term "designee" is used in this section, it shall
mean a person who is
impartial,
a member in good standing of the Rhode Island bar and a person who is
sufficiently
acquainted
with the rules of evidence as used in the superior court of the state so as to
enable that
person
to conduct a hearing as designee of the director. The reasonable per diem cost
of the
designee
as appointed by the director shall be paid by the insurers requesting changes
in the rates.
SECTION 5. This act shall take effect upon passage.
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LC00075/SUB A
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