An Act To Clarify and Update the Laws Related to Health Insurance
Maine Legislature, Session 121, LD 1507
Committee: Insurance and Financial Services
Sponsors: CANAVAN, MAYO
Amends: 24-A MRSA §2850-B, 24 MRSA §2317-B, 24-A MRSA §2809-A, 24-A MRSA §4209, 24-A MRSA §1901, 24-A MRSA §2803-A, 24 MRSA §2327, 24-A MRSA §2839, 24 MRSA §2321, 24-A MRSA §2736, 24-A MRSA §2691, 24-A MRSA §2701, 24-A MRSA §1951, 24-A MRSA §2736-C, 24-A MRSA §2747, 24-A MRSA §2808-B

Legislative Document 
No. 1507 
H.P.1100 
House of Representatives, April 1, 2003 
An Act To Clarify and Update the Laws Related to Health 
Insurance 
Submitted by the Department of Professional and Financial Regulation pursuant to Joint 
Rule 204. 
Reference to the Committee on Insurance and Financial Services suggested and ordered 
printed. 
Presented by Representative CANAVAN of Waterville. 
Cosponsored by Senator MAYO of Sagadahoc and 
Representati ve: O'NEIL of Saco. 
Printed on recycled paper 
Ir/~ 
/J7. 7lI1l.C~ 
MILLICENT M. MacFARLAND 
Clerk 
Be it enacted by the People of the State of Maine as follows: 
PART A 
Sec. A·t. 24·A MRSA §2850·B, sub·§3, "G and H, as enacted by 
PL 1997, c. 445, §30 and affected by §32, are amended to read: 
G. 
When the carrier ceases offering a product and meets the 
following requirements: 
(1) 
In the large group market: 
(a) 
The 
carrier 
must 
provide 
notice 
to 
the 
policyholder and to the insureds at least 90 days 
before termination: 
(b) 
The carrier must offer to each policyholder 
the option to purchase any other product currently 
being offered in the large group market; and 
(c) 
In exercising the option to discontinue the 
product and in offering the option of coverage 
under division (b), the carrier must act uniformly 
without regard to the claims experience of the 
policyholders or the health status of the insureds 
or prospective insureds: 
(2) 
In the small group market: 
(a) 
The carrier shall replace the product with a 
product that complies with the requirements of 
this 
section, 
including 
renewability, 
and 
with 
section 2808-B: 
(b) 
The 
superintendent 
shall 
find 
that 
the 
replacement 
is 
in 
the 
best 
interests 
of 
the 
policyholders; and 
(c) 
The 
carrier shall 
provide 
notice 
to 
the 
policyholder and to the insureds at least 90 days 
before replacement; or 
(3) 
In the individual market: 
(a) 
The carrier shall replace the product with a 
product that complies with the 
requirements 
of 
this 
section, 
including 
renewability, 
and 
with 
section 2736-C; 
Page l-LR19l3 (1) 
(b) 
The 
superintendent 
shall 
find 
that 
the 
replacement 
is 
in 
the 
best 
interests 
of 
the 
policyholders; and 
(c) 
The 
carrier shall provide 
notice 
to 
the 
policyholder 
and, 
if 
a 
group 
policy, 
to 
the 
insureds at least 90 days before replacement; e~ 
H. 
In renewing a large group policy in accordance with this 
section, 
a 
carrier 
may 
modify 
the 
coverage, 
terms 
and 
conditions of the policy consistent with other applicable 
prov1s1ons 
of 
state 
and 
federal 
laws 
as 
long 
as 
the 
modifications are applied uniformly to all policyholders of 
the 
same 
productT---~~~-~~~--Qee6--~-~~--~e 
iRQiviQ~al-e~-6mall-~~e~p-pelieie6T~ 
Sec. A-2. 24-A MRSA §2850-B, sub-§3, 11 is enacted to read: 
I. 
In renewing an individual or small group policy in 
accordance with this section, 
a 
carrier may 
make 
minor 
modifications to the coverage, terms and conditions of the 
policy consistent with other applicable provisions of state 
and federal 
laws as 
long as the modifications meet the 
conditions 
specified in this paragraph 
and 
are 
applied 
uniformly 
to 
all 
policyholders 
of 
the 
same 
product. 
Modifications not meeting the reguirements in this paragraph 
are considered a discontinuance of the product pursuant to 
paragraph G. 
(1) 
A modification pursuant to this paragraph must be 
approved 
by 
the 
superintendent. 
The 
superintendent 
shall 
approve 
the 
modification 
if 
it 
meets 
the 
reguirements of this section. 
(2) 
A change in a reguirement for eligibility is not a 
minor modification pursuant to this paragraph if the 
change results in the exclusion of a class or category 
of enrollees currently covered. 
(3) 
Benefit modifications reguired by law are deemed 
minor modifications for purposes of this paragraph. 
(4) 
Benefit modifications 
other 
than modifications 
reguired by law are minor modifications only if they 
meet 
the 
reguirements 
of 
this 
subparagraph. 
For 
purposes of this subparagraph, changes in conditions or 
reguirements 
specified 
in 
the 
policy, 
such 
as 
preauthorization reguirements, 
are considered benefit 
modifications. 
(a) 
The total of any increases in benefits may 
not increase the actuarial value of the total 
benefit package by more than 5%. 
(b) 
The total of any decreases in benefits may 
not decrease the actuarial value of the total 
benefit package by more than 5%. 
(c) 
For purposes of the calculations in divisions 
(a) 
and 
(b), 
increases 
and 
decreases 
must 
be 
considered 
separately 
and 
may 
not 
offset 
one 
another. 
(5) 
A carrier must 
give 
days' 
notice 
of 
any 
modification pursuant to this paragraph to all affected 
policyholders and certificate holders. 
PART B 
Sec. B-1. 24 MRSA §2317-B, sub-§15-A is enacted to read: 
15-A. 
Title 
24-A. 
section 
2809-A. 
Conversion 
on 
termination of policy or eligibility, Title 24 A, section 2809-A; 
Sec. B-2. 
24-A MRSA §2809-A, sub-§l-A, 
as 
repealed 
and 
replaced by PL 1995, c. 625, Pt. A, §25, is amended to read: 
I-A. 
Notification of cancellation. 
An insurer mHst-pF9viae 
By--~~~-~~-mail--a~-~~--~~--eays~-~-~-~~~~£~~~--9t 
eaBee±±at:i-ea-~~-£--nonpaymen-t-~~-pFemi1:lffi may not cancel or refuse 
to renew any policy for hospital, 
surgical, 
dental or major 
medical expense insurance until the insurer has provided by first 
class mail at least 10 days' prior notification according to this 
section. 
The notice must include the date of cancellation of 
coverage and, 
if applicable, 
the 
time period for exercising 
policy conversion rights. 
The 
notice 
also 
must 
include 
an 
explanation of any applicable grace period. 
Notification is not 
required when the insurer has received written notice from the 
group policyholder that replacement coverage has been obtained. 
A. 
Notice must be mailed to the group policyholder or 
subgroup sponsor. 
B. 
At the time of 
must 
be mailed to 
address provided to 
the subgroup sponsor 
notification under paragraph A, notice 
the certificate holder 
at+ 
the last 
the insurer by the group policyholder, 
or the certificate holder. 
f±}-~~-ba&~-aQQFe66-~~~-By-~h€-~~-SP9BS9F 
eF-tRe-~FeHp-pe±ieYRelQeF-te-tRe-iB6HFeFf-eF 
~~}-~he-~~~~~--~h&-s~B~FeQP-£pea£e~7-~~-~r~r-~Re 
~FeQP-pel~eYRelQe~T 
Sec. B-3. 24-A MRSA §4209, sub-§6, as enacted by PL 1995, c. 
189, §3 and affected by §4, is amended to read: 
6. 
Notification of cancellation. 
A health maintenance 
organization HI~s~-E'.£e .... iQe may not cancel or refuse to renew any 
contract until it has provided by first class mail at least 10 
days' 
prior 
notification 
eE--€aa€eJ~~~~-~~--~ym&&~--eE 
eBFeJ.J.Hlea~-~acH'~es according to this section. 
The notice must 
include the date of cancellation of coverage and the time period 
for exercising contract conversion rights. 
The notice also must 
include 
an 
explanation 
of 
the 
applicable 
grace 
period. 
Notification is 
not 
required when 
the 
insurer 
has 
received 
written notice from the group contract holder that replacement 
coverage has been obtained. 
A. 
Notice must be mailed to the group contract holder or 
subgroup sponsor. 
B. 
At the time of 
must be mailed to 
address provided to 
the group contract 
enrollee. 
notification under paragraph A, notice 
the individual enrollee 
at~ the last 
the health 
maintenance organization by 
holder, 
the 
subgroup 
sponsor or the 
~l}--~-~a£~--aaaFe&&-~~~-ey--~h&-~~-eeB~Faet 
RelaeF-te-tRe-RealtR-HlaiBteBaBee-aF~aBiBatiaBf-aF 
~6}-~he-~~~~~--~h&-SQB~Fa~p-£pea£e~7-~~~r~r-~Re 
~FaQP-eeB~Fae~-RalaeFT 
GT--Na~i€e-~-~~~~-~e-~Re-~~ea~-~--~~-a&G-~a 
the-8QFea~-aE-baBaF-StaBQaFQST 
PARTC 
Sec. C-l. 24-A MRSA §1901, sub-§l, as amended by PL 1999, c. 
609, §2, is further amended by amending the first paragraph to 
read: 
1. 
"Administrator" means any person who, 
on behalf of a 
plan 
sponsor, 
health 
care 
service 
plan, 
health 
maintenance 
organization 
or 
insurer, 
receives 
or 
collects 
charges, 
contributions or premiums for, or adjusts or settles claims on 
residents of this State in connection with any type of life, 
annuity, health aFL 
workers' 
compensation or employee benefit 
excess insurance benefit provided in or as 
insurance as defined by sections 702 to 704, 
Title 39-A, other than any of the following: 
PARTD 
an alternative to 
former Title 39 or 
Sec. D·l. 24-A MRSA §2803-A, sub-§2, as amended by PL 2001, c. 
410, Pt. B, §l, is further amended to read: 
2. 
Disclosure of basic loss information. 
Upon written 
request, every insurer shall provide loss information concerning 
a 
group 
policy or 
contract 
to 
its policyholder 
or 
former 
policyholder within 21 business days of the date of the request. 
PARTE 
Sec. E-l. 24 MRSA §2327, as amended by PL 1985, c. 648, §2, 
is further amended to read: 
§2327. 
Group rates 
Ne 
A group health care contract may not be issued by a 
nonprofit hospital or medical service organization in this State 
until a copy of the group maBaal rates to be used in calculating 
the 
FaEes 
premium 
for 
these 
contracts 
has 
been 
filed 
for 
informational purposes with the superintendent. 
The filing must 
include the base rates and a description of any procedures to be 
used to adjust the base rates to reflect factors including but 
not limited to age, gender, health status, claims experience, 
group size and coverage of dependents. 
Notwithstanding this 
section, rates for group Medicare supplement, nursing home care 
or 
long-term care contracts and for certain group contracts 
included within the definition of "individual health plan" in 
Title 24-A, section 2736-C, subsection 1, paragraph C must be 
filed in accordance with section 2321. 
Sec. E-2. 24-A MRSA §2839, as amended by PL 1985, c. 648, 
§ll, is further amended to read: 
§2839. 
Rates filed 
Ne A policy of group health insurance may not be delivered 
in this State until a copy of the group maBaal rates to be used 
in calculating the premium for these policies has been filed for 
informational purposes with the superintendent. 
The filing must 
include the base rates and a description of any procedures to be 
used to adjust the base rates to reflect factors including but 
not limited to age, gender, health status, claims experience, 
group size and coverage of dependents. 
Notwithstanding this 
section, rates for group Medicare supplement, nursing home care 
or long-term care insurance contracts and for certain association 
groups and other groups specified in section 2701, subsection 2, 
paragraph C must be filed in accordance with section 2736. ~ 
for small group health insurance subject to section 2808-B are 
subject to the additional filing requirements specified in that 
section. 
PARTF 
Sec. F-l. 24 MRSA §2321, sub-§l, as amended by PL 1997, c. 
344, §6, is further amended to read: 
1. 
Filing- of rate information. 
Every nonprofit hospital 
and 
medical 
service 
organization 
shall 
file 
with 
the 
superintendentT--&~e&F&-~-~~-~~-£~h6£~~~--aBa--memBeFshi~ 
eeBtFaets--etheF--thaB--~FeQ~--MeaieaFe--SQ~~~emeBt--eeBtFaets--as 
aeEiBea--~-~~~~~-~4-A7-~F~~-~--aBQ-~~eaF-~~~-~-eF 
leB~-teFm-~~-ee&&~ae&s-~~~~&&G-~~-~~~-~4-A7-~~--98T 
every rate, rating formula and every modification of any of the 
foregoing that it proposes to use in connection with individual 
heal th insurance contracts, group Medicare supplement contracts 
as defined in Title 24 A, 
chapter 67 I 
group nursing home or 
long term care contracts as defined in Title 24 A, chapter 68 or 
A, and certain group contracts included within the definition 
of 
"individual health plan" 
in Title 
A, 
section 
2736-C, 
subsection L 
paragraph C. 
Every filing under this subsection 
must state the effective date of the filing. 
Every filing under 
this subsection must be made not less than 60 days in advance of 
the stated effective date unless the 60-day requirement is waived 
by the superintendent for a period of time not to exceed 30 
days. 
In the case of a 
filing that meets 
the criteria in 
subsection 4, the superintendent may suspend the effective date 
for a longer period not to exceed 30 days from the date the 
organization satisfactorily responds to any reasonable discovery 
requests. 
IB-~~~-ef-~~~~-aBQ--~~~-eeBtFaetsT 
~ates-~~~~~~-e~~e&~ve-fe£-~~~-tha&-~-~~--&~~&-that 
~ates-~G£-~~~~~~~-~QaFaBteea-~ev€d-~~~~~-eEEeetiye 
EeF-the-aQFatieB-eE-the-eeBtFaetT 
Sec. F-2. 24-A MRSA §2736, sub-§l, as amended by PL 1997 I 
c. 
344, §8, is further amended to read: 
1. 
Filing- of rate information. 
Every insurer shall file 
with the 
superintendentT-~--as-~~~~-~e~~€y-~~~-e~heF 
~aaH-~~-~~-~£eQ~-~~~~~-~elieies-~~~~-iB 
eha~teF--97r-~&G-~~-~~~-~-£~~-aBQ--±eB~-te£m--eaFe 
iBSQ£aBee-~~~~&eQ-~B-~~--98T every rate, rating formula, 
classification of risks and every modification of any formula or 
classification that it proposes 
to 
use 
in 
connection 
with 
individual health insurance policies and certain group policies 
specified in section 2701. 
Every such filing must state the 
effective date of the filing. 
Every such filing must be made not 
less than 60 days in advance of the stated effective date, unless 
the 60-day requirement is waived by the superintendent, and the 
effective date may be suspended by the superintendent for 
a 
period of time not to exceed 30 days. 
In the case of a filing 
that meets the criteria in subsection 3, the superintendent may 
suspend the effective date for a longer period not to exceed 30 
days from the date the organization satisfactorily responds to 
any reasonable discovery requests. 
±l1.--t-be--eas-e--ef--nu-r-s-i-ng--Heme 
eaFe--aBQ--~~~~-~-~~~-~~~~--~~~~--f4±ea--aFe 
effee~ive--feF--~-~~-~~-~-~~--~~~--~ha~--~a~e6--fe~ 
eea~Fae~S-~~-~QaFaa~eea-~~--pFemiQms-~~-effee~ive-~~--~He 
aQFa~iea-ef-~he-eea~Fae~T 
PARTG 
Sec. G-l. 24 MRS A §2317-B, sub-§20, as enacted by PL 1999, c. 
256, Pt. M, §10, is amended to read: 
20. 
Tit1e 24-A, 
chapters 68 and 68-A. 
Long-term care 
insurance, 
nursing home 
care insurance 
and 
home 
health care 
insurance, Title 24-A, 
ehap~e~ chapters 68 and 68-A. 
Sec. G-2. 24-A MRSA §2691, sub-§3, ,D, as enacted by PL 200L 
c. 410, Pt. C, §1, is amended to read: 
D. 
Long-term care insurance policies subject to 
eHaF~e~ 
chapters 68 and 68-A; 
Sec. G-3. 24-A MRSA §2701, sub-§2, ,A, as amended by PL 1995, 
c. 332, Pt. J, §1, is further amended to read: 
A. 
Sections 2736, 2736-A and 2736-B apply to group Medicare 
supplement policies as defined in chapter 67 aaa 
.L group 
nursing home care and long-term care insurance policies as 
defined in chapter 68 or 68-A; 
PARTH 
Sec. H-l. 24-A MRSA §1951, sub-§2, as corrected by RR 2001, c. 
2, Pt. B, §42 and affected by §58, is amended to read: 
2. 
Private 
purchasing 
a11iance. 
"Private 
purchasing 
alliance" or "alliance" means a corporation lieeB&e4-p\iFs\iaBt;.-~e 
~His--6e€~iea established under former Title 13-A, Title 13-B or 
Title 13-C to provide health insurance to its members through one 
or more participating carriers. 
Sec. H-2. 24-A MRS A §1952, as enacted by PL 1995, c. 673, 
Pt. A, §3, is amended to read: 
§1952. 
Licensure 
A 
FeF6eR--eF--ea~i~y private purchasing alliance 
may 
not 
market, sell, offer or arrange for a 
package of one or more 
health benefit plans underwritten by 
~ ~ or more carriers 
without 
first 
being 
licensed 
by 
the 
superintendent. 
The 
superintendent shall specify by rule standards and procedures for 
the 
issuance 
and 
renewal 
of 
licenses for private purchasing 
alliances. 
A rule may require an application fee of not more 
than $400 and an annual license fee of not more than $100. 
A 
license may not be issued until the rulemaking required by this 
chapter has been undertaken and all required rules are in effect. 
Sec. H-3. 24-A MRSA §2736-C, sub-§5, as enacted by PL 1993, 
c. 477, Pt. C, §1 and affected by Pt. F, §1, is amended to read: 
5. 
Loss ratios. 
For all policies and certificates issued 
on 
or 
after 
the 
effective 
date 
of 
this 
section, 
the 
superintendent shall disapprove any premium rates filed by any 
carrier, whether initial or revised, 
for an individual health 
policy unless it is anticipated that the aggregate benefits 
estimated to be paid under all the individual health policies 
maintained in force by the carrier for the period for which 
coverage is to be provided will return to policyholders at least 
65°" of the aggregate premiums collected for those policies, as 
determined in accordance with accepted actuarial principles and 
practices and on the basis of incurred claims experience and 
earned premiums. 
Sec. H-4. 24-A MRSA §2747, sub-§l, as enacted by PL 1981, c. 
205, §2, is amended to read: 
1. 
Any 
insurer 
denying 
medical 
expense 
reimbursement 
benefits on any of the grounds specified in subsection 2 for a 
claim filed pursuant to a policy issued under this chapter, other 
than a policy that is subject to section 4312, shall provide the 
policy or certificate holder with an opportunity to have the 
denial reviewed by the insurer and to arbitrate the denial if not 
satisfied after review. The right to review and arbitrate saa!! 
must be prominently set forth in any written notice sent to the 
policy or certificate holder denying the claim. The arbitration 
saa!!--ae 
is 
nonbinding 
and 
saa!! 
must 
be 
carried 
out 
in 
accordance with procedures established by the insurer. 
Sec. H-S. 24-A MRSA §2808-B, sub-§l, ,D, as amended by PL 
2001, c. 258, Pt. E, §3 and c. 400, §1 and affected by §2, is 
repealed and the following enacted in its place: 
D. 
"Eligible group" means any person, firm, corporation, 
partnership, association or subgroup engaged actively in a 
business that employed an average of 50 or fewer eligible 
employees during the preceding calendar year. 
(1) 
If an employer was not in existence throughout the 
preceding 
calendar year, 
the 
determination 
must 
be 
based 
on the 
average 
number of employees 
that the 
employer is reasonably expected to employ on business 
days in the current calendar year. 
( 2 ) 
In determining the number of eligible employees, 
companies that are affiliated companies or that are 
eligible to file a combined tax return for purposes of 
state taxation are considered one employer. 
(3) 
A group is not an eligible group if there is any 
one other state where there are more eligible employees 
than are employed within this State and the group had 
coverage in that state or is eligible for guaranteed 
issuance of coverage in that state. 
(4) 
An employer qualifies as an eligible group for 
person coverage if the employer provides a carrier 
with the following information demonstrating that the 
employer's 
business 
and 
employees 
meet 
the 
m~n~mum 
qualifications for group coverage in paragraph C: 
(a) 
A copy of the most recent quarterly combined 
filing for income tax withholding and unemployment 
contributions, Form 941/C1 ME; 
(b) 
For an employee claimed to be an employee 
eligible for 
group 
coverage whose 
name 
is not 
listed on Form 941/CI-ME, a copy of the employer's 
payroll 
records 
for 
the 
most 
recent 
months 
showing tax withholding or a wage report from a 
payroll 
company 
showing 
wages 
paid 
to 
that 
employee 
for 
the most 
recent quarter with tax 
withholding; 
(c) 
If an employer is exempt from filing Form 
941/C1-ME 
for 
group 
coverage, 
documentation 
of 
that 
exemption 
and 
a 
copy 
of 
the 
employer's 
payroll 
records 
for 
the 
most 
recent 
months 
showing tax withholding or a wage report from a 
payroll 
company 
showing 
wages 
paid 
to 
that 
employee 
for 
the most 
recent quarter with tax 
withholding; or 
(d) 
If the name of the business owner or employee 
does not appear on Form 941/C1-ME, a copy of one 
of the following: 
(i) 
Federal income tax Form Schedule C or 
Schedule F; 
(ii) 
Federal income tax Form 1120S, Schedule 
K-l; 
(iii) 
Federal income tax Form 1065, Schedule 
K-1; 
(iv) 
A workers' compensation insurance audit 
or evidence of a 
waiver of benefits under 
Title 39-A; 
(v) 
A 
description 
of 
operations 
in 
a 
commercial general liability insurance policy 
or 
equivalent 
insurance 
policy 
providing 
coverage for the business; or 
(vi) 
A 
signature 
card 
from 
a 
financial 
institution or credit union authorizing the 
employee 
to 
sign 
checks 
on 
a 
business 
checking or share draft account that is at 
least 
months 
old; 
a 
notarized affidavit 
from the employer describing the duties of 
the employee and the average number of hours 
worked by the employee and attesting that the 
employer is not defrauding the carrier and is 
aware of the consequences of committing fraud 
or making a material misrepresentation to the 
carrier, 
including 
a 
loss of coverage 
and 
benefits; 
and, 
if 
the 
group 
coverage 
is 
purchased 
through 
a 
producer, 
a 
notarized 
affidavit 
from 
the 
producer 
affirming 
the 
producer's belief that the employer qualifies 
as an eligible group for coverage. 
In determining if a 
new business or a business that 
adds an owner or a new employee to payroll during the 
course of a year qualifies as an eligible group for 
2-person coverage under this subparagraph, the employer 
must submit an affidavit stating that all employees 
meet the criteria in this subparagraph and that the 
documentation 
and 
forms 
required 
under 
this 
subparagraph will 
be 
provided 
to 
the 
carrier 
when 
payroll 
records 
become 
available, 
when 
ownership 
distribution 
forms 
become 
available 
or 
the 
first 
renewal 
date 
of 
the 
coverage, 
whichever 
date 
is 
earlier. A false affidavit or misrepresentation on an 
affidavit submitted by an employer may result in the 
loss of group coverage and repayment of claims paid. 
This subparagraph may not be construed to prohibit a 
carrier from recognizing an employer as 
an eligible 
group 
if 
the 
employer 
has 
not 
produced 
the 
documentation required in this subparagraph. 
This subparagraph applies only to an employer applying 
for group health insurance coverage as a 2-person group 
on or after October 1, 2001. 
Sec. H·6. 24·A MRSA §4331, sub·§4, as enacted by PL 1999, c. 
609, §20, is amended to read: 
4. 
Downstream 
risk 
arranqement. 
"Downstream 
risk 
arrangement" means aay--€-empeJl.£at.-iea an arrangement .eet:weea that 
transfers insurance risk 
from 
a carrier aaa to 
a 
downstream 
entity t:hat:--may--aiFeet:ly--eF--iaaiFeet:ly--have--t:he--effeet:--ef 
Fea~eia~--9F--~~~~~~-~~~-~~~~-~~-~~~~eB£--ef--t:he 
ea~FieF. 
Sec. H·7. 24·A MRSA §5011, sub-§2, as enacted by PL 1991, c. 
740, §13, is amended to read: 
2. 
Discounts. 
Issuers 
that 
do 
not 
vary 
rates 
for 
a 
standardized plan based on age, gender, health status, claims 
experience, policy duration, industry or occupation, and that do 
not refuse issue of that plan to any individual or group based on 
health status, may provide discounts on that plan to individuals 
who purchase coverage during their initial period of 
eli~i.eilit:y 
feF enrollment in Medicare Part A-by-~~~~-a~e B at or after 
years of age, sUbject to approval by the superintendent. 
The 
superintendent may adopt rules governing the appropriate use of 
discounts. 
SUMMARY 
Part 
A 
facilitates 
the 
updating 
of 
small 
group 
and 
individual health insurance policies by permitting limited minor 
changes at renewal with 60 days' 
notice to policyholders and 
insureds. 
Page ll-LRI913(1) 
Part B strengthens and clarifies the law requiring notice of 
termination of a group health plan. 
It expands the requirement 
to apply to terminations other than for nonpayment of premium and 
to apply to dental insurance. 
It also requires the notice to be 
sent to each insured I s last known home address and repeals the 
requirement 
to 
send 
copies 
of 
termination 
notices 
to 
the 
Department of Professional and Financial Regulation, 
Bureau of 
Insurance 
and 
to the 
Department 
of 
Labor, 
Bureau 
of 
Labor 
Standards. 
Part C expands the scope of the law 
administrators 
to 
include 
entities 
that 
benefit excess insurance. 
governing 
administer 
3rd-party 
employee 
Part D clarifies that the requirement for health carriers to 
provide experience data to large groups applies with respect to 
former policyholders as well as current policyholders. 
Part 
with 
the 
insurance. 
E clarifies the rate 
Bureau 
of 
Insurance 
information that must be filed 
with 
respect 
to 
group 
health 
Part F repeals the provision making long-term care insurance 
rates effective for only 3 years and clarifies the rate filing 
requirements for individual health insurance to specify that they 
apply 
to 
association 
group 
coverage 
that 
falls 
within 
the 
definition of individual health plan. 
Part G corrects several references to the long-term care 
insurance laws. 
Part H makes several housekeeping corrections. 
It clarifies 
the definition of "private purchasing alliance" by removing a 
reference to licensure. 
It removes 
reference to 
"2 or more 
carriers" in the purchasing alliance law, consistent with recent 
amendments 
that permit purchasing alliances to 
use 
a 
single 
carrier. 
It clarifies that a provision of the individual health 
plan law applies to certificates as well as policies. 
It exempts 
policies from 
the statute concerning arbitration if they are 
subject to the newer statute concerning external review. 
It 
corrects a reference to a tax form. 
It clarifies the definition 
of 
"downstream 
risk 
arrangement." 
Lastly, 
it 
corrects 
a 
reference 
in the 
provision 
concerning discounts 
on 
Medicare 
supplement insurance. 
Page l2-LR1913(1)