Chapter
271
2006 -- S 2264 SUBSTITUTE A
Enacted 07/03/06
A N A
C T
RELATING TO INSURANCE
- THE RHODE ISLAND HEALTH CARE AFFORDABILITY
ACT OF 2006 - PART IV
- HIGH RISK POOL
Introduced By: Senator Marc
A. Cote
Date Introduced: February
02, 2006
It is
enacted by the General Assembly as follows:
SECTION
1. Section 27-18.5-3 of the General Laws in Chapter 27-18.5 entitled
"Individual
Health Insurance Coverage" is hereby amended to read as follows:
27-18.5-3.
Guaranteed availability to certain individuals. -- (a) Notwithstanding
any
of the
provisions of this title to the contrary, all health insurance carriers that
offer health
insurance
coverage in the individual market in this state shall provide for the
guaranteed
availability
of coverage to an eligible individual or an individual who has had health
insurance
coverage,
including coverage in the individual market, or coverage under a group health
plan or
coverage
under 5 U.S.C. section 8901 et seq. and had that coverage continuously for at
least
twelve
(12) consecutive months and who applies for coverage in the individual market
no later
than
sixty-three (63) days following termination of the coverage, desiring to enroll
in individual
health
insurance coverage, and who is not eligible for coverage under a group health
plan, part A
or part
B or title XVIII of the Social Security Act, 42 U.S.C. section 1395c et seq. or
42 U.S.C.
section
1395j et seq., or any state plan under title XIX of the Social Security Act, 42
U.S.C.
section
1396 et seq. (or any successor program) and does not have other health
insurance
coverage
(provided, that eligibility for the other coverage shall not disqualify an
individual with
twelve (12)
months of consecutive coverage if that individual applies for coverage in the
individual
market for the primary purpose of obtaining coverage for a specific
pre-existing
condition,
and the other available coverage excludes coverage for that pre-existing
condition) and
may
not:
(1) Decline to offer the coverage to, or deny enrollment of, the individual; or
(2) Impose any preexisting condition exclusion with respect to the coverage.
(b) (1) All health insurance carriers that offer health insurance coverage in
the individual
market
in this state shall offer all policy forms of health insurance coverage.
Provided, the carrier
may
elect to limit the coverage offered so long as it offers at least two (2)
different policy forms
of health
insurance coverage (policy forms which have different cost-sharing arrangements
or
different
riders shall be considered to be different policy forms) both of which:
(i) Are designed for, made generally available to, and actively market to, and
enroll both
eligible
and other individuals by the carrier; and
(ii) Meet the requirements of subparagraph (A) or (B) of this paragraph as
elected by the
carrier:
(A) If the carrier offers the policy forms with the largest, and next to the
largest,
premium
volume of all the policy forms offered by the carrier in this state; or
(B) If the carrier offers a choice of two (2) policy forms with representative
coverage,
consisting
of a lower-level coverage policy form and a higher-level coverage policy form
each of
which
includes benefits substantially similar to other individual health insurance
coverage offered
by the
carrier in this state and each of which is covered under a method that provides
for risk
adjustment,
risk spreading, or financial subsidization.
(2) For the purposes of this subsection, "lower-level coverage" means
a policy form for
which
the actuarial value of the benefits under the coverage is at least eighty-five
percent (85%)
but not
greater than one hundred percent (100%) of the policy form weighted average.
(3) For the purposes of this subsection, "higher-level coverage"
means a policy form for
which
the actuarial value of the benefits under the coverage is at least fifteen
percent (15%)
greater than
the actuarial value of lower-level coverage offered by the carrier in this
state, and the
actuarial
value of the benefits under the coverage is at least one hundred percent (100%)
but not
greater
than one hundred twenty percent (120%) of the policy form weighted average.
(4) For the purposes of this subsection, "policy form weighted
average" means the
average
actuarial value of the benefits provided by all the health insurance coverage
issued (as
elected
by the carrier) either by that carrier or, if the data are available, by all
carriers in this state
in the
individual market during the previous year (not including coverage issued under
this
subsection),
weighted by enrollment for the different coverage. The actuarial value of
benefits
shall be
calculated based on a standardized population and a set of standardized
utilization and
cost
factors.
(5) The carrier elections under this subsection shall apply uniformly to all
eligible
individuals
in this state for that carrier. The election shall be effective for policies
offered during
a period
of not shorter than two (2) years.
(c) (1) A carrier may deny health insurance coverage in the individual market
to an
eligible
individual if the carrier has demonstrated to the director that:
(i) It does not have the financial reserves necessary to underwrite additional
coverage;
and
(ii) It is applying this subsection uniformly to all individuals in the
individual market in
this
state consistent with applicable state law and without regard to any health
status-related
factor
of the individuals and without regard to whether the individuals are eligible
individuals.
(2) A carrier upon denying individual health insurance coverage in this state
in
accordance
with this subsection may not offer that coverage in the individual market in
this state
for a
period of one hundred eighty (180) days after the date the coverage is denied
or until the
carrier
has demonstrated to the director that the carrier has sufficient financial reserves
to
underwrite
additional coverage, whichever is later.
(d) Nothing in this section shall be construed to require that a carrier
offering health
insurance
coverage only in connection with group health plans or through one or more bona
fide
associations,
or both, offer health insurance coverage in the individual market.
(e) A carrier offering health insurance coverage in connection with group
health plans
under
this title shall not be deemed to be a health insurance carrier offering individual
health
insurance
coverage solely because the carrier offers a conversion policy.
(f) Nothing Except for any high risk pool rating rules to be
established by the Office of
the
Health Insurance Commissioner (OHIC) as described in this section, nothing in this section
shall be
construed to create additional restrictions on the amount of premium rates that
a carrier
may
charge an individual for health insurance coverage provided in the individual
market; or to
prevent
a health insurance carrier offering health insurance coverage in the individual
market
from
establishing premium rates or modifying applicable copayments or deductibles in
return for
adherence
to programs of health promotion and disease prevention.
(g)
OHIC may pursue federal funding in support of the development of a high risk
pool
for
the individual market, as defined in section 27-18.5-2, contingent upon a
thorough assessment
of
any financial obligation of the state related to the receipt of said federal
funding being
presented
to, and approved by, the general assembly by passage of concurrent general
assembly
resolution.
The components of the high risk pool program, including, but not limited to,
rating
rules,
eligibility requirements and administrative processes, shall be designed in
accordance with
Section
2745 of the Public Health Service Act (42 U.S.C. 300gg-45) also known as the
State
High
Risk Pool Funding Extension Act of 2006 and defined in regulations promulgated
by the
office
of the health insurance commissioner on or before October 1, 2007.
(g)(h)(1) In the case of a health insurance carrier that offers
health insurance coverage in
the
individual market through a network plan, the carrier may limit the individuals
who may be
enrolled
under that coverage to those who live, reside, or work within the service areas
for the
network
plan; and within the service areas of the plan, deny coverage to individuals if
the carrier
has
demonstrated to the director that:
(i) It will not have the capacity to deliver services adequately to additional
individual
enrollees
because of its obligations to existing group contract holders and enrollees and
individual
enrollees;
and
(ii) It is applying this subsection uniformly to individuals without regard to
any health
status-related
factor of the individuals and without regard to whether the individuals are
eligible
individuals.
(2) Upon denying health insurance coverage in any service area in accordance
with the
terms of
this subsection, a carrier may not offer coverage in the individual market
within the
service
area for a period of one hundred eighty (180) days after the coverage is
denied.
SECTION
2. This act shall take effect upon passage.
=======
LC01507/SUB A
=======