N.Y. ISC Law § 4305 — New York Code / Act ISC / Article 43 / Section 4305
Group contracts
Status: in_force

§ 4305. Group contracts. (a) A corporation subject to the provisions\nof this article may issue a group contract, provided the group of\npersons thereby covered conforms to the requirements of subsections (c)\nand (d) of section four thousand two hundred thirty-five or of\nsubparagraph (C) of paragraph three of subsection (a) of section four\nthousand two hundred thirty-seven of this chapter, and provided such\ncontract and the individual certificates issued to members of the group\nshall comply in substance with this article. A corporation subject to\nthe provisions of this article shall issue to the group contractholder,\nfor delivery to each member of the insured group, a copy of the\ncontract, or a certificate which can be in the form of a booklet setting\nforth in summary form a statement of the essential features of the\ninsurance coverage. A group contract issued pursuant to this section\nshall be subject to subsections (k) and (l) of section four thousand two\nhundred thirty-five of this chapter.\n  (b) Any such contract which provides for the adjustment of the rate of\npremium based upon the experience thereunder shall specify the duration\nof the period of insurance thereunder; such period shall not exceed\nthree years, provided, however, that such contract may provide that, in\nthe absence of one month's prior written notice by either party to the\nother, it shall be automatically renewed at the termination of any\nperiod thereunder for a succeeding period of not less than one nor more\nthan three years' duration. In any case where such contract is for a\nperiod of more than one year, an appropriate additional rate of premium\nshall be charged therefor. Any such contract may provide for the\nadjustment of the rate of premium based upon the experience thereunder\nat the end of the first period of insurance thereunder or at the end of\nany subsequent period of insurance thereunder and any such adjustment\nmay be made retroactive only for the period of insurance immediately\npreceding such adjustment.\n  (c) (1)(A) Any such contract may provide that benefits will be\nfurnished to a member of a covered group, for the member, the member's\nspouse, child or children, or other persons chiefly dependent upon the\nmember for support and maintenance; provided that:\n  (i) a contract of hospital, medical, surgical, or prescription drug\nexpense insurance that provides coverage for children shall provide such\ncoverage to a married or unmarried child until attainment of age\ntwenty-six, without regard to financial dependence, residency with the\nmember, student status, or employment, except a contract that is a\ngrandfathered health plan may, for plan years beginning before January\nfirst, two thousand fourteen, exclude coverage of an adult child under\nage twenty-six who is eligible to enroll in an employer-sponsored health\nplan other than a group health plan of a parent. For purposes of this\nitem, "grandfathered health plan" means coverage provided by a\ncorporation in which an individual was enrolled on March twenty-third,\ntwo thousand ten for as long as the coverage maintains grandfathered\nstatus in accordance with section 1251(e) of the Affordable Care Act, 42\nU.S.C. § 18011(e); and\n  (ii) a contract under which coverage terminates at a specified age\nshall, with respect to an unmarried child who is incapable of\nself-sustaining employment by reason of mental illness, developmental\ndisability, as defined in the mental hygiene law, or physical handicap\nand who became so incapable prior to attainment of the age at which\ncoverage would otherwise terminate and who is chiefly dependent upon\nsuch member for support and maintenance, not so terminate while the\ncontract remains in force and the child remains in such condition, if\nthe member has within thirty-one days of such child's attainment of the\ntermination age submitted proof of such child's incapacity as described\nherein.\n  (B) In addition to the requirements of subparagraph (A) of this\nparagraph, every corporation issuing a group contract of hospital,\nmedical or surgical expense insurance pursuant to this section that\nprovides coverage for children, must make available and if requested by\nthe contractholder, extend coverage under that contract to an unmarried\nchild through age twenty-nine, without regard to financial dependence\nwho is not insured by or eligible for coverage under any employer health\nbenefit plan as an employee or member, whether insured or self-insured,\nand who lives, works or resides in New York state or the service area of\nthe corporation. Such coverage shall be made available at the inception\nof all new contracts and with respect to all other contracts at any\nanniversary date. Written notice of the availability of such coverage\nshall be delivered to the contractholder prior to the inception of such\ngroup contract and annually thereafter.\n  (C) Notwithstanding any rule, regulation or law to the contrary, any\ncontract under which a member elects coverage for the member, the\nmember's spouse, children or other persons chiefly dependent upon the\nmember for support and maintenance shall provide that coverage of\nnewborn infants, including newly born infants adopted by the member if\nsuch member takes physical custody of the infant upon such infant's\nrelease from the hospital and files a petition pursuant to section one\nhundred fifteen-c of the domestic relations law within thirty days of\nbirth; and provided further that no notice of revocation to the adoption\nhas been filed pursuant to section one hundred fifteen-b of the domestic\nrelations law and consent to the adoption has not been revoked, shall be\neffective from the moment of birth for injury or sickness including the\nnecessary care and treatment of medically diagnosed congenital defects\nand birth abnormalities including premature birth, except that in cases\nof adoption, coverage of the initial hospital stay shall not be required\nwhere a birth parent has insurance coverage available for the infant's\ncare. This provision regarding coverage of newborn infants shall not\napply to two person coverage. In the case of individual or two person\ncoverages the corporation must also permit the person to whom the\ncertificate is issued to elect such coverage of newborn infants from the\nmoment of birth. If notification and/or payment of an additional premium\nor contribution is required to make coverage effective for a newborn\ninfant, the coverage may provide that such notice and/or payment be made\nwithin no less than thirty days of the day of birth to make coverage\neffective from the moment of birth. This election shall not be required\nin the case of student insurance or where the group's plan does not\nprovide coverage for children.\n  (2) Any such contract under which coverage of a dependent spouse or\ngroup member would terminate upon such spouse or group member attaining\nthe age prescribed in subchapter XVIII of the Social Security Act, 42\nU.S.C. § 1395 et seq. ("Medicare"), as the age of first eligibility for\nthe benefits provided by such law shall not so terminate, if such\ndependent spouse is not then eligible for all of such benefits, for as\nlong as the contract remains in force and such dependent spouse remains\nineligible to receive any of such "Medicare" benefits, provided proof of\nsuch ineligibility is submitted to the corporation within thirty-one\ndays of the date notice of termination of coverage is sent by first\nclass mail by the corporation to the last known address of the\npolicyholder.\n  (d) (1) (A) A group contract issued pursuant to this section shall\ncontain a provision to the effect that in case of a termination of\ncoverage under such contract of any member of the group because of (i)\ntermination for any reason whatsoever of the member's employment or\nmembership, or (ii) termination for any reason whatsoever of the group\ncontract itself unless the group contract holder has replaced the group\ncontract with similar and continuous coverage for the same group whether\ninsured or self-insured, the member shall be entitled to have issued to\nthe member by the corporation, without evidence of insurability, upon\napplication therefor and payment of the first premium made to the\ncorporation within sixty days after termination of the coverage, an\nindividual direct payment contract, covering such member and the\nmember's eligible dependents who were covered by the group contract,\nwhich provides coverage that contains the essential health benefits\npackage described in paragraph three of subsection (e) of section four\nthousand three hundred six-h of this article. The corporation shall\noffer one contract at each level of coverage as defined in subsection\n(b) of section four thousand three hundred six-h of this article. The\nmember may choose any such contract offered by the corporation.\nProvided, however, the superintendent may, after giving due\nconsideration to the public interest, approve a request made by a\ncorporation for the corporation to satisfy the requirements of this\nsubparagraph through the offering of contracts that comply with this\nsubparagraph by another corporation, insurer or health maintenance\norganization within the corporation's same holding company system, as\ndefined in article fifteen of this chapter.\n  (B) The conversion privilege afforded in this paragraph shall also be\navailable: (i) upon the divorce or annulment of the marriage of a\nmember, to the divorced spouse or former spouse of such member; (ii)\nupon the death of the member, to the surviving spouse and other\ndependents covered under the contract; and (iii) to a dependent if no\nlonger within the definition in the contract.\n  (2) The effective date of the coverage provided by the individual\ndirect payment contract shall be the date of the termination of the\nindividual's coverage under the group contract. The corporation shall\nnot be required to issue such individual direct payment converted\ncontract covering any person if it appears that such person shall then\nbe covered by another individual contract providing similar coverage or\nif it shall appear that such person is covered by or eligible to be\ncovered by a group contract or policy providing similar benefits or is\nprovided with similar benefits required by any statute or provided by\nany welfare plan or program, which together with the individual direct\npayment converted contract would result in over-insurance or duplication\nof benefits according to standards on file with the superintendent of\nfinancial services relating to individual contracts.\n  (3) (A) Each member in the insured group, but not his dependents,\nshall be given written notice of such conversion privilege provided in\nparagraph one hereof and its duration within fifteen days after the date\nof termination of coverage under the group contract, provided that if\nsuch notice be given more than fifteen days but less than ninety days\nafter the date of termination of coverage under the group contract the\ntime allowed for the exercise of such conversion privilege shall be\nextended for forty-five days after the giving of such notice. If such\nnotice is not given within ninety days after the date of termination of\ncoverage under the group contract the time allowed for the exercise of\nsuch conversion privilege shall expire at the end of such ninety days.\n  (B) Written notice by the contract holder given to the member or sent\nby first class mail to the member at his last known address, or written\nnotice by the corporation which issued the group contract sent by first\nclass mail to the member at the last address furnished to the\ncorporation by the contract holder, shall be deemed full compliance with\nthe provisions of this paragraph for the giving of notice.\n  (C) A group contract issued pursuant to this section may contain a\nprovision to the effect that notice of such conversion privilege and its\nduration shall be given by the contract holder to each certificate\nholder upon termination of his group coverage.\n  (4) A group contract to be issued to a social services district\npursuant to section three hundred sixty-five of the social services law\nby a corporation subject to the provisions of this article need not,\nsubject to the approval of the superintendent, provide for the issuance\nof individual certificates and may omit or modify any of the other\nprovisions required to be contained in such contract, provided that the\nsuperintendent deems such omission or modification suitable for the\ncharacter of the coverage provided.\n  (5) For purposes of this subsection, the term "dependent" shall\ninclude a child as described in subsection (c) of this section.\n  (e) In addition to the conversion privilege afforded by subsection (d)\nof this section, a group contract issued by a hospital service, health\nservice or medical expense indemnity corporation shall provide that if\nall or any portion of the insurance on an employee or member insured\nunder the policy ceases because of termination of employment or\nmembership in the class or classes eligible for coverage under the\npolicy, such employee or member shall be entitled without evidence of\ninsurability upon application to continue his insurance for himself or\nherself and his or her eligible dependents, subject to all of the group\ncontract's terms and conditions applicable to those forms of benefits\nand to the following conditions:\n  (1) Continuation shall cease on the date which the employee, member or\ndependant first becomes, after the date of election: (A) entitled to\ncoverage under title XVIII of the United States Social Security Act\n(Medicare) as amended or superseded; or (B) covered as an employee,\nmember or dependent by any other insured or uninsured arrangement which\nprovides hospital, surgical or medical coverage for individuals in a\ngroup which does not contain any exclusion or limitation with respect to\nany pre-existing condition of such employee, member or dependent.\n  (2) (A) An employee or member who wishes continuation of coverage must\nrequest such continuation in writing within the sixty day period\nfollowing the later of: (i) the date of such termination; or (ii) the\ndate the employee is sent notice by first class mail of the right of\ncontinuation by the group policyholder.\n  (B) An employee or member who wishes continuation of coverage under\nsubparagraph (D) of paragraph four of this subsection must give notice\nto the employer or group policyholder within sixty days of the\ndetermination under title II or title XVI of the United States Social\nSecurity Act that such employee or member was disabled at the time of\ntermination of employment or membership or at any time during the first\nsixty days of continuation of coverage.\n  (3) An employee or member electing continuation must pay to the group\npolicyholder or his employer, but not more frequently than on a monthly\nbasis in advance, the amount of the required premium payment, but not\nmore than one hundred two percent of the group rate for the benefits\nbeing continued under the group contract on the due date of each\npayment. The employee's or member's written election of continuation,\ntogether with the first premium payment required to establish premium\npayment on a monthly basis in advance, must be given to the policyholder\nor employer within sixty days of the date the employee's or member's\nbenefits would otherwise terminate.\n  (4) Subject to paragraph one of this subsection, continuation of\nbenefits under the group contract for any person shall terminate at the\nfirst to occur of the following:\n  (A) The date thirty-six months after the date the employee's or\nmember's benefits under the contract would otherwise have terminated\nbecause of termination of employment or membership; or\n  (B) The end of the period for which premium payments were made, if the\nemployee or member fails to make timely payment of a required premium\npayment; or\n  (C) In the case of an eligible dependent of an employee or member, the\ndate thirty-six months after the date such person's benefits under the\ncontract would otherwise have terminated by reason of:\n  (i) the death of the employee or member;\n  (ii) the divorce or legal separation of the employee or member from\nhis or her spouse;\n  (iii) the employee or member becoming entitled to benefits under title\nXVIII of the United States Social Security Act (Medicare); or\n  (iv) a dependent child ceasing to be a dependent child under the\ngenerally applicable requirements of the contract; or\n  (D) The date on which the group contract is terminated or, in the case\nof an employee, the date his employer terminated participation under the\ngroup contract. However, if this clause applies and the coverage ceasing\nby reason of such termination is replaced by similar coverage under\nanother group contract, the following shall apply:\n  (i) The employee or member shall have the right to become covered\nunder that other group contract, for the balance of the period that he\nwould have remained covered under the prior group contract in accordance\nwith this subparagraph had a termination described in this subparagraph\nnot occurred, and\n  (ii) The minimum level of benefits to be provided by the other group\ncontract shall be the applicable level of benefits of the prior group\ncontract reduced by any benefits payable under the prior group contract,\nand\n  (iii) The prior group contract shall continue to provide benefits to\nthe extent of its accrued liabilities and extensions of benefits as if\nthe replacement had not occurred.\n  (5) A notification of the continuation privilege and the time period\nin which to request continuation shall be included in each certificate\nof coverage.\n  (6) The conversion privilege afforded by subsection (d) of this\nsection shall be available upon termination of the continuation of\nbenefits described herein.\n  (7) This subsection shall not be applicable where a continuation\nbenefit is available to the employee or member pursuant to Chapter 18 of\nthe Employee Retirement Income Security Act, 29 U.S.C. § 1161 et seq or\nChapter 6A of the Public Health Service Act, 42 U.S.C. § 300 bb - 1 et\nseq. However, a group contract shall offer an employee or member who has\nexhausted continuation coverage pursuant to Chapter 18 of the Employee\nRetirement Income Security Act, 29 U.S.C. § 1161 et seq. or Chapter 6A\nof the Public Health Service Act, 42 U.S.C. § 300 bb - 1 et seq. the\nopportunity to continue coverage for up to thirty-six months from the\ndate the employee's or member's continuation coverage began if the\nemployee or member is entitled to less than thirty-six months of\ncontinuation benefits.\n  (8)(A) Special enrollment period. An individual who does not have an\nelection of continuation coverage as described in this subsection in\neffect on the effective date of the American Recovery and Reinvestment\nact of 2009, but who would be an assistance eligible individual under\nTitle III of such act if such election were in effect, may elect\ncontinuation coverage pursuant to this subsection. Such election must be\nmade no later than sixty days after the date the administrator of the\ngroup health plan (or other entity involved) provides the notice\nrequired by section 3001(a)(7) of the American Recovery and Reinvestment\nact of 2009. The administrator of the group health plan (or other entity\ninvolved) shall provide such individuals with additional notice of the\nright to elect coverage pursuant to this paragraph within sixty days of\nthe date of enactment of the American Recovery and Reinvestment act of\n2009.\n  (B) Continuation coverage elected pursuant to subparagraph (A) of this\nparagraph shall commence with the first period of coverage beginning on\nor after the date of the enactment of the American Recovery and\nReinvestment act of 2009 and shall not extend beyond the period of\ncontinuation coverage that would have been required if the coverage had\ninstead been elected pursuant to paragraph two of this subsection.\n  (C) With respect to an individual who elects continuation coverage\npursuant to subparagraph (A) of this paragraph, the period beginning on\nthe date of the qualifying event and ending on the date of the first\nperiod of coverage on or after the enactment of the American Recovery\nand Reinvestment act of 2009 shall be disregarded for purposes of\ndetermining the sixty-three day period referred to in section four\nthousand three hundred eighteen of this article.\n  (9) For purposes of this subsection, the term "dependent" shall\ninclude a child as described in subsection (c) of this section.\n  (f) Any contract and certificate, other than one issued in fulfillment\nof the continuing care responsibilities of an operator of a continuing\ncare retirement community in accordance with article forty-six of the\npublic health law, made available because of residence in a particular\nfacility, housing development, or community shall contain the following\nnotice in twelve point type in bold face on the first page:\n  "NOTICE - THIS CONTRACT (CERTIFICATE) DOES NOT MEET THE REQUIREMENTS\nOF A CONTINUING CARE RETIREMENT CONTRACT. AVAILABILITY OF THIS COVERAGE\nWILL NOT QUALIFY A RESIDENTIAL FACILITY AS A CONTINUING CARE RETIREMENT\nCOMMUNITY."\n  (g) In addition to all the rights of conversion and continuation\notherwise provided for herein, employees or members insured under the\ncontract who are also members of a reserve component of the armed forces\nof the United States, including the National Guard, shall be entitled to\nhave supplementary conversion and continuation rights in certain\ncircumstances as follows:\n  (1) if the employee or member insured enters upon active duty as\ndefined in subsection (h) of this section, and the employer or group\ncontract holder does not voluntarily maintain coverage for such employee\nor member insured, the employee or member insured shall be entitled to\nhave his or her coverage continued under the group contract in\naccordance with the conditions and limitations contained in paragraph\nseven of this subsection and have issued at the end of the period of\ncontinuation an individual conversion policy subject to the terms of\nthis subsection.  The effective date for the conversion policy shall be\nthe day following the termination of insurance under the group policy,\nor if there is a continuation of coverage, on the day following the end\nof the period of continuation.\n  (2) if the employer or group contract holder does not voluntarily\nmaintain coverage for the employee or member insured during the period\nof active duty, and such employee or member insured does not elect the\nsupplementary conversion and continuation rights provided for herein,\ncoverage for such employee or member insured shall be suspended during\nthe period of active duty.\n  (3) if the employee or member insured elects the supplementary\ncontinuation right provided for herein or coverage under the group plan\nis suspended, and such employee or member insured dies during the period\nof active duty, the conversion right provided by this section shall be\navailable to the surviving spouse and children, and shall be available\nto a child solely with respect to himself or herself upon his or her\nattaining the limiting age of coverage under the group contract while\ncovered as a dependent thereunder. It shall also be available upon the\ndivorce or annulment of the marriage of the employee or member insured,\nto the former spouse of such employee or member insured, if such divorce\nor annulment occurs during the period of active duty.\n  (4) if the employee or member insured elects the supplementary\nconversion and continuation right provided for herein or coverage under\nthe group plan is suspended, and such employee or member insured is\neither reemployed or restored to participation in the group upon return\nto civilian status, he or she shall be entitled to resume participation\nin insurance offered by the group pursuant to this section, with no\nlimitations or conditions imposed as a result of such period of active\nduty except as set forth in subparagraphs (A) and (B) herein. The right\nof resumption provided for herein shall extend to coverage for the\nspouse and dependents of the employee or member insured and shall be in\naddition to other existing rights granted pursuant to state and federal\nlaws and regulations and shall not be deemed to qualify or limit such\nrights in any way. No exclusion or waiting period may be imposed in\nconnection with coverage of a health or physical condition of a person\nentitled to such right of resumption, or a health or physical condition\nof any other person who is covered by the policy unless:\n  (A) the condition arose during the period of active duty and the\ncondition has been determined by the secretary of veterans affairs to be\na condition incurred in the line of duty; or\n  (B) a waiting period was imposed and had not been completed prior to\nthe period of suspension; in no event, however, shall the sum of the\nwaiting periods imposed prior to and subsequent to the period of\nsuspension exceed the length of the waiting period originally imposed.\n  (5) if the employee or member insured elects the supplementary\nconversion and continuation coverage provided for herein:\n  (A) when such employee or member insured is either reemployed or\nrestored to participation in the group, coverage under the supplementary\nrights provided for herein shall terminate on the date that coverage is\neffective due to resumption of participation in the group.\n  (B) when such employee or member insured is not reemployed or restored\nto participation in the group upon return to civilian status, he or she\nshall be entitled to the conversion and continuation rights provided by\nsubsections (d) and (e) of this section.\n  (i) To elect an individual conversion contract pursuant to subsection\n(d) of this section, the employee or member insured must apply to the\ninsurer within thirty-one days of the termination of active duty or\ndischarge from hospitalization incident to such active duty, which\nhospitalization continues for a period of not more than one year. Upon\ncommencement of coverage under the conversion right provided pursuant to\nsubsection (d) of this section, coverage under the supplementary\ncontinuation right provided for herein shall terminate.\n  (ii) To elect continuation of coverage pursuant to subsection (e) of\nthis section, the employee or member insured must request such\ncontinuation of the employer within thirty-one days of the termination\nof active duty or discharge from hospitalization incident to such active\nduty, which hospitalization continues for a period of not more than one\nyear. Upon commencement of coverage under the continuation right\nprovided pursuant to subsection (e) of this section, coverage under the\nsupplementary continuation right provided for herein shall terminate.\nThe employee or member insured shall be entitled to have issued at the\nend of the period of continuation an individual conversion contract.\n  (6) if coverage under the group plan is suspended during the period of\nactive duty:\n  (A) when the employee or member insured returns to participation in\nthe group plan, coverage under the group plan shall be retroactive to\nthe date of termination of the period of active duty.\n  (B) when such employee or member insured is not reemployed or restored\nto participation in the group upon return to civilian status, he or she\nshall be entitled to the conversion and continuation rights provided by\nsubsections (d) and (e) of this section.\n  (i) To elect an individual conversion contract pursuant to subsection\n(d) of this section, the employee or member insured must apply to the\ninsurer within thirty-one days of the termination of active duty or\ndischarge from hospitalization incident to such active duty, which\nhospitalization continues for a period of not more than one year.\n  (ii) To elect continuation of coverage pursuant to subsection (e) of\nthis section, the employee or member insured must request such\ncontinuation of the employer within thirty-one days of the termination\nof active duty or discharge from hospitalization incident to such active\nduty, which hospitalization continues for a period of not more than one\nyear. The employee or member insured shall be entitled to have issued at\nthe end of the period of continuation an individual conversion contract.\n  (7) A group contract providing hospital, surgical or medical expense\ninsurance for other than accident only shall provide that if all or any\nportion of the insurance on an employee or member insured under the\ncontract ceases because the employee or member insured is ordered to\nactive duty as defined in subsection (h) of this section, such employee\nor member insured shall be entitled, without evidence of insurability,\nupon application to continue his or her hospital, surgical or medical\nexpense insurance for himself or herself and his or her eligible\ndependents, under the supplementary conversion and continuation rights\nprovided for herein, subject to all of the group policy's terms and\nconditions applicable to those forms of benefits and to the following\nconditions:\n  (A) continuation shall cease on the date which the employee, member or\ndependant first becomes, after the date of election: (i) entitled to\ncoverage under title XVIII of the United States Social Security Act\n(Medicare) as amended or superseded or (ii) covered as an employee,\nmember or dependent by any other insured or uninsured arrangement which\nprovides hospital, surgical or medical coverage for individuals in a\ngroup, except that the coverage available to active duty members of the\nuniformed services and their family members shall not be considered a\ngroup under the terms of this subsection and except that the group\ninsurance contract conversion option of this section shall not be\nconsidered as such an arrangement under which an employee, member or\ndependent could become covered.\n  (B) an employee or member insured who wishes continuation of coverage\npursuant to this subsection must request such continuation in writing\nwithin sixty days of being ordered to active duty.\n  (C) an employee or member insured electing continuation pursuant to\nthis subsection must pay to the group contract holder or his or her\nemployer, but not more frequently than on a monthly basis in advance,\nthe amount of the required premium payment, but not more than the group\nrate for the benefits being continued under the group contract on the\ndue date of each payment.\n  (8) The supplementary conversion and continuation rights provided for\nherein shall apply to:\n  (A) contracts not covered by Chapter 18 of the Employee Retirement\nIncome Security Act, 29 U.S.C. section 1161 et seq or Chapter 6A of the\nPublic Health Service Act, 42 U.S.C. section 300bb-1 et seq;\n  (B) contracts covered by Chapter 18 of the Employee Retirement Income\nSecurity Act, 29 U.S.C. section 1161 et seq or Chapter 6A of the Public\nHealth Service Act, 42 U.S.C. section 300bb-1 et seq, when active duty\nfor reservists and the refusal of an employer to voluntarily maintain\ncoverage for such period of active duty is not considered a qualifying\nevent.\n  (h) To be entitled to the right defined in subsection (g) of this\nsection a person must be a member of a reserve component of the armed\nforces of the United States, including the National Guard, who either:\n  (1) voluntarily or involuntarily enters upon active duty (other than\nfor the purpose of determining his or her physical fitness and other\nthan for training), or\n  (2) has his or her active duty voluntarily or involuntarily extended\nduring a period when the president is authorized to order units of the\nready reserve or members of a reserve component to active duty, provided\nthat such additional active duty is at the request and for the\nconvenience of the federal government, and\n  (3) serves no more than four years of active duty.\n  (j)(1) Except as provided in this section, if a corporation delivers\nor issues for delivery in this state a group or blanket contract which\nprovides hospital, surgical or medical expense coverage for other than\naccident only, the corporation must renew or continue in force such\ncoverage at the option of the contract holder.\n  (2) A corporation may nonrenew or discontinue coverage under such a\ngroup or blanket contract based only on one or more of the following:\n  (A) The contract holder or a participating entity has failed to pay\npremiums or contributions in accordance with the terms of the contract\nor the corporation has not received timely premium payments.\n  (B) The contract holder or a participating entity has performed an act\nor practice that constitutes fraud or made an intentional\nmisrepresentation of material fact under the terms of the contract.\n  (C) The contract holder has failed to comply with a material plan\nprovision relating to employer contribution or group participation\nrules, as permitted under section four thousand two hundred thirty-five\nof this chapter.\n  (D) The corporation is ceasing to offer group or blanket contracts in\na market in accordance with paragraph three or paragraph six of this\nsubsection.\n  (E) The contract holder ceases to meet the requirements for a group\nunder section four thousand two hundred thirty-five of this chapter or a\nparticipating employer, labor union, association or other entity ceases\nmembership or participation in the group to which the contract is\nissued. Coverage terminated pursuant to this paragraph shall be done\nuniformly without regard to any health status-related factor relating to\nany covered individual.\n  (F) In the case of a corporation that offers a group or blanket\ncontract in a market through a network plan, there is no longer any\nenrollee in connection with such plan who lives, resides or works in the\noperating area of the corporation (or in the area for which the\ncorporation is authorized to do business).\n  (G) Such other reasons as are acceptable to the superintendent and\nauthorized by the Health Insurance Portability and Accountability Act of\n1996, Public Law 104-191, and any later amendments or successor\nprovisions, or by any federal regulations or rules that implement the\nprovisions of the Act.\n  (3) (A) In any case in which a corporation decides to discontinue\noffering a particular class of group or blanket contract of hospital,\nsurgical or medical expense insurance offered in the small or large\ngroup market, the contract of such class may be discontinued by the\ncorporation in accordance with this chapter in such market only if:\n  (i) the corporation provides written notice to each contract holder\nprovided coverage of this class in such market (and to all employees and\nmember insureds covered under such coverage) of such discontinuance at\nleast ninety days prior to the date of discontinuance of such coverage.\nIn addition to any other information required of notices by the\nsuperintendent, this written notice shall conspicuously include an\nexplanation, in plain language, of the contract holder's and covered\nemployee's or member insured's rights under this subparagraph and\nsubparagraph (B) of this paragraph, including:\n  (I) a statement that if the superintendent determines that the covered\nemployee, member insured, or a dependent has a serious medical\ncondition, and the covered employee, member insured or dependent within\nthe previous twelve months utilized a benefit under; the contrary\nrelated to the serious medical condition that is not covered by the\nreplacement coverage offered to the contract holder as a result of the\ndiscontinuance, then the superintendent shall require the corporation to\noffer the contract holder replacement coverage that includes a benefit\nthat is the same as or substantially similar to the benefit set forth in\nthe contract that the corporation discontinued; and\n  (II) an explanation as to how to contact the superintendent, and the\ndate by which the superintendent shall be contacted, if the contract\nholder, covered employee or member insured believes that the covered\nemployee, member insured or a dependent has a serious medical condition,\nand the covered employee, member insured or dependent within the\nprevious twelve months utilized a benefit related to the serious medical\ncondition that may not be covered by the replacement coverage offered to\nthe contract holder as a result of the discontinuance;\n  (ii) the corporation offers to each contract holder provided coverage\nof this class in such market, the option to purchase all (or, in the\ncase of the large group market, any) other hospital, surgical and\nmedical expense coverage currently being offered by the corporation to a\ngroup in such market;\n  (iii) in exercising the option to discontinue coverage of this class\nand in offering the option of coverage under item (ii) of this\nsubparagraph, the corporation acts uniformly without regard to the\nclaims experience of those contract holders or any health status-related\nfactor relating to any particular covered employee, member insured or\ndependent who may become eligible for such coverage, and the corporation\nis not discontinuing the coverage of this class with the intent or as a\npretext to discontinuing the coverage of any such employee, member\ninsured or dependent; and\n  (iv) at least ninety days prior to the date of discontinuance of such\ncoverage, the corporation provides written notice to the superintendent\nof such discontinuance, including the reason for the discontinuance, and\nan officer or director of the corporation certifies to the\nsuperintendent that the corporation has complied with items (i), (ii)\nand (iii) of this paragraph. If such notice does not include the date or\ndates that the corporation mailed or delivered the notice to all\ncontract holders, covered employers and member insureds, the corporation\nshall notify the superintendent of such date within seven days of the\ncompletion of the mailing or delivery.\n  (B) If the superintendent determines that the corporation has not\ncomplied with item (iii) of subparagraph (A) of this paragraph, then the\nsuperintendent may prohibit the corporation from discontinuing the class\nof contracts and require the corporation to promptly notify every\ncontract holder, covered employee and member insured that the\ncorporation is not discontinuing the contracts. If the superintendent\ndetermines that the corporation wrongfully discontinued the class of\ncontracts pursuant to item (iii) of subparagraph (A), then the\nsuperintendent shall require that the corporation take remedial action,\nincluding offering to group contract holders the option of reinstating\nthe discontinued contract forms. If the superintendent determines that\nthe corporation discontinued the class of contracts without compliance\nwith items (i), (ii), or (iv) of subparagraph (A), and an employee,\nmember insured or dependent covered under the discontinued contract\nwould have been entitled to relief under this paragraph, then the\nsuperintendent may require that the corporation offer replacement\ncoverage to an affected contract holder consistent with item (ii) of\nsubparagraph (C) of this paragraph.\n  (C) (i) If, within forty-five days after the corporation mails or\ndelivers the written notice of discontinuance required by item (i) of\nsubparagraph (A) of this paragraph, the superintendent is notified by a\ncontract holder or covered employee or member insured that a covered\nemployee, member insured or dependent has a serious medical condition\nand that a benefit utilized by the covered employee, member insured or\ndependent within the previous twelve months related to the serious\nmedical condition may not be covered by the replacement coverage offered\nto the contract holder as a result of the discontinuance, then the\nsuperintendent shall, within twenty days of the notification, ask the\ncorporation to confirm that the covered employee, member insured or\ndependent utilized a benefit within the previous twelve months to treat\nthe medical condition that the covered employee, member insured or\ndependent asserts is a serious medical condition, and that the benefit\nis not covered by the replacement coverage. The superintendent may\nrequest such additional information as the superintendent may require.\nThe corporation shall provide all requested information to the\nsuperintendent within five days of receipt of the request.\n  (ii) If, within twenty days of the superintendent's receipt of all\nadditional information requested from the corporation, the\nsuperintendent determines that (I) the covered employee, member insured\nor dependent has a serious medical condition; and (II) the benefit\nutilized by the covered employee, member insured or dependent within the\nprevious twelve months related to the serious medical condition is not\ncovered by the replacement coverage offered to the contract holder as a\nresult of the discontinuance, then the superintendent shall require the\ncorporation to offer to the contract holder replacement coverage that\nincludes a benefit that is the same as or substantially similar to the\nbenefit set forth in the contract that the corporation discontinued. If\nthe replacement coverage is not available, at the time that the contract\nwould otherwise be discontinued, then the corporation shall keep the\nexisting policy in force for the affected contract holder until the\nreplacement coverage with the substantially similar benefit is\navailable.\n  (D) The remedies as provided in this paragraph shall be in addition to\nand not in lieu of any other authority or power of the superintendent to\nimpose monetary or other penalties for violations of this paragraph.\n  (E) In any case in which a corporation elects to discontinue offering\nall hospital, surgical and medical expense coverage in the small group\nmarket or the large group market, or both markets, in this state, health\ninsurance coverage may be discontinued by the corporation only if:\n  (i) the corporation provides written notice to the superintendent and\nto each contract holder (and all employees and member insureds covered\nunder such coverage) of such discontinuance at least one hundred eighty\ndays prior to the date of the discontinuance of such coverage;\n  (ii) all hospital, surgical and medical expense coverage issued or\ndelivered for issuance in this state in such market or markets is\ndiscontinued and coverage under such contracts in such market or markets\nis not renewed; and\n  (iii) in addition to the notice to the superintendent referred to in\nitem (i) of this subparagraph, the corporation shall provide the\nsuperintendent with a written plan to minimize potential disruption in\nthe marketplace occasioned by the corporation's withdrawal from the\nmarket.\n  (F) In the case of a discontinuance under subparagraph (E) of this\nparagraph in a market, the corporation may not provide for the issuance\nof any group or blanket contract of hospital, surgical or medical\nexpense insurance in that market in this state during the five-year\nperiod beginning on the date of the discontinuance of the last health\ninsurance contract not so renewed.\n  (4) At the time of coverage renewal, an insurer may modify the health\ninsurance coverage for a group or blanket contract offered to a large or\nsmall group contract holder so long as such modification is consistent\nwith this chapter and effective on a uniform basis among all small group\ncontract holders with that contract.\n  (5) For purposes of this subsection the term "network plan" shall mean\na health insurance contract under which the financing and delivery of\nhealth care (including items and services paid for as such care) are\nprovided, in whole or in part, through a defined set of providers under\ncontract either with the corporation or another entity that has\ncontracted with the corporation.\n  (6) Notwithstanding paragraph three of this subsection, a corporation\nmay discontinue offering a particular class of group or blanket contract\nof hospital, surgical or medical expense insurance offered in the small\nor large group market, and instead offer a group or blanket contract of\nhospital, surgical or medical expense insurance that complies with the\nrequirements of section 2707 of the public health service act, 42 U.S.C.\n§ 300gg-6 that become applicable to such contract as of January first,\ntwo thousand fourteen, provided that the corporation:\n  (A) discontinues the existing class of contract in such market as of\neither December thirty-first, two thousand thirteen or the contract\nrenewal date occurring in two thousand fourteen in accordance with this\nchapter;\n  (B) provides written notice to each contract holder provided coverage\nof the class in the market (and to all employees and member insureds\ncovered under such coverage) of the discontinuance at least ninety days\nprior to the date of discontinuance of such coverage. The written notice\nshall be in a form satisfactory to the superintendent;\n  (C) offers to each contract holder provided coverage of the class in\nthe market, the option to purchase all (or, in the case of the large\ngroup market, any) other hospital, surgical and medical expense coverage\nthat complies with the requirements of section 2707 of the public health\nservice act, 42 U.S.C. § 300gg-6 that become applicable to such coverage\nas of January first, two thousand fourteen, currently being offered by\nthe corporation to a group in that market;\n  (D) in exercising the option to discontinue coverage of the class and\nin offering the option of coverage under subparagraph (C) of this\nparagraph, acts uniformly without regard to the claims experience of\nthose contract holders or any health status-related factor relating to\nany particular covered employee, member insured or dependent, or\nparticular new employee, member insured, or dependent who may become\neligible for such coverage, and does not discontinue the coverage of the\nclass with the intent or as a pretext to discontinuing the coverage of\nany such employee, member insured, or dependent; and\n  (E) at least one hundred twenty days prior to the date of the\ndiscontinuance of such coverage, provides written notice to the\nsuperintendent of the discontinuance, including certification by an\nofficer or director of the corporation that the reason for the\ndiscontinuance is to replace the coverage with new coverage that\ncomplies with the requirements of section 2707 of the public health\nservice act, 42 U.S.C. § 300gg-6 that become effective January first,\ntwo thousand fourteen. The written notice shall be in such form and\ncontain such information the superintendent requires.\n  (k)(1) No corporation delivering or issuing for delivery in this state\na group or blanket contract which provides hospital, surgical or medical\nexpense coverage shall establish rules for eligibility (including\ncontinued eligibility) of any individual or dependent of the individual\nto enroll under the contract based on any of the following health\nstatus-related factors:\n  (A) Health status.\n  (B) Medical condition (including both physical and mental illnesses).\n  (C) Claims experience.\n  (D) Receipt of health care.\n  (E) Medical history.\n  (F) Genetic information.\n  (G) Evidence of insurability (including conditions arising out of acts\nof domestic violence).\n  (H) Disability.\n  (2) For purposes of paragraph one of this subsection, rules for\neligibility include rules defining any applicable waiting periods for\nsuch enrollment.\n  (3) No corporation may, on the basis of any health status-related\nfactor in relation to the subscriber or dependent of the subscriber,\nrequire any subscriber (as a condition of enrollment or continued\nenrollment under the contract) to pay a premium or contribution which is\ngreater than such premium for a similarly situated subscriber enrolled\nin the plan.\n  (4) Nothing in this subsection shall require a corporation to issue a\ngroup or blanket contract to a group comprised of fifty-one or more\nlives exclusive of spouses and dependents.\n  (5) Where an eligible subscriber or dependent of a subscriber rejects\ninitial enrollment in a group or blanket contract that provides\nhospital, surgical or medical expense insurance, a corporation shall\npermit a subscriber or dependent of a subscriber to enroll for coverage\nunder the terms of the contract if each of the following conditions are\nmet:\n  (A) The subscriber or dependent was covered under another plan or\ncontract at the time coverage was initially offered.\n  (B)(i) Coverage was provided in accordance with continuation required\nby federal or state law and was exhausted; or\n  (ii) Coverage under the other plan or contract was subsequently\nterminated as a result of loss of eligibility for one or more of the\nfollowing reasons:\n  (I) termination of employment;\n  (II) termination of the other plan or contract;\n  (III) death of the spouse;\n  (IV) legal separation, divorce or annulment;\n  (V) reduction in the number of hours of employment; or\n  (iii) Contract holder contributions toward the payment of premium for\nthe other plan or contract were terminated.\n  (C) Coverage must be applied for within thirty days of termination for\none of the reasons set forth in subparagraph (B) of this paragraph.\n  (6) With respect to group or blanket contracts delivered or issued for\ndelivery in this state covering between two and fifty employees or\nmembers, the provisions of this subsection shall in no way diminish the\nrights of such groups pursuant to section four thousand three hundred\nseventeen of this article.\n  (7) For purposes of this subsection, the term "dependent" shall\ninclude a child as described in subsection (c) of this section.\n  (l)(1) As used in this subsection, "child" means an unmarried child\nthrough age twenty-nine of an employee or member insured under a group\ncontract of hospital, medical or surgical expense insurance, regardless\nof financial dependence, who is not insured by or eligible for coverage\nunder any employer health benefit plan as an employee or member, whether\ninsured or self-insured, and who lives, works or resides in New York\nstate or the service area of the corporation and who is not covered\nunder title XVIII of the United States Social Security Act (Medicare).\n  (2) In addition to the conversion privilege afforded by subsection (d)\nof this section and the continuation privilege afforded by subsection\n(e) of this section, a hospital service, health service or medical\nexpense corporation or health maintenance organization that provides\ngroup hospital, medical or surgical coverage under which coverage of a\nchild terminates at a specified age shall, upon application of the\nemployee, member or child, as set forth in subparagraph (B) of this\nparagraph, provide coverage to the child after that specified age and\nthrough age twenty-nine without evidence of insurability, subject to all\nof the terms and conditions of the group contract and the following:\n  (A) An employer shall not be required to pay all or part of the cost\nof coverage for a child provided pursuant to this subsection;\n  (B) An employee, member or child who wishes to elect continuation of\ncoverage pursuant to this subsection shall request the continuation in\nwriting:\n  (i) within sixty days following the date coverage would otherwise\nterminate due to reaching the specified age set forth in the group\ncontract;\n  (ii) within sixty days after meeting the requirements for child status\nset forth in paragraph one of this subsection when coverage for the\nchild previously terminated; or\n  (iii) during an annual thirty-day open enrollment period, as described\nin the contract;\n  (C) An employee, member or child electing continuation as described in\nthis subsection shall pay to the group contractholder or employer, but\nnot more frequently than on a monthly basis in advance, the amount of\nthe required premium payment on the due date of each payment. The\nwritten election of continuation, together with the first premium\npayment required to establish premium payment on a monthly basis in\nadvance, shall be given to the group contractholder or employer within\nthe time periods set forth in subparagraph (B) of this paragraph. Any\npremium received within the thirty-day period after the due date shall\nbe considered timely;\n  (D) For any child electing coverage within sixty days of the date the\nchild would otherwise lose coverage due to reaching a specified age, the\neffective date of the continuation coverage shall be the date coverage\nwould have otherwise terminated. For any child electing to resume\ncoverage during an annual open enrollment period, the effective date of\nthe continuation coverage shall be prospective no later than thirty days\nafter the election and payment of first premium;\n  (E) Coverage for a child pursuant to this subsection shall consist of\ncoverage that is identical to the coverage provided to the employee or\nmember parent. If coverage is modified under the contract for any group\nof similarly situated employees or members, then the coverage shall also\nbe modified in the same manner for any child;\n  (F) Coverage shall terminate on the first to occur of the following:\n  (i) the date the child no longer meets the requirements of paragraph\none of this subsection;\n  (ii) the end of the period for which premium payments were made, if\nthere is a failure to make payment of a required premium payment within\nthe period of grace described in subparagraph (C) of this paragraph; or\n  (iii) the date on which the group contract is terminated and not\nreplaced by coverage under another group contract; and\n  (G) The corporation or health maintenance organization shall provide\nwritten notification of the continuation privilege described in this\nsubsection and the time period in which to request continuation to the\nemployee or member:\n  (i) in each certificate of coverage; and\n  (ii) at least sixty days prior to termination at the specified age as\nprovided in the contract.\n  (3)(A) Corporations and health maintenance organizations shall submit\nsuch reports as may be requested by the superintendent to evaluate the\neffectiveness of coverage pursuant to this subsection including, but not\nlimited to, quarterly enrollment reports.\n  (B) The superintendent may promulgate regulations to ensure the\norderly implementation and operation of the continuation coverage\nprovided pursuant to this subsection, including premium rate\nadjustments.\n  (m) A health care claim from a subscriber covered under a contract\nissued pursuant to this section shall be submitted within one hundred\ntwenty days from the date of service; provided, however, that if it was\nnot reasonably possible for the subscriber to submit the claim within\nthat timeframe, then the claim shall be submitted as soon as reasonably\npossible.\n  (n) (1) Any corporation subject to the provisions of this article that\nissues hospital, surgical or medical expense contracts in the small\ngroup or large group market in this state shall offer to any employer in\nthis state all such contracts in the applicable market, and shall accept\nat all times throughout the year any employer that applies for any of\nthose contracts.\n  (2) The requirements of paragraph one of this subsection shall apply\nwith respect to an employer that applies for coverage either directly\nfrom the corporation or through an association or trust to which the\ncorporation has issued coverage and in which the employer participates.\n