2023 New York Laws › ISC - Insurance › Article 43 - Non-Profit Medical and Dental Indemnity, or Health and Hospital Service Corporations › 4305 - Group Contracts.

§  4305.  Group contracts. (a) A corporation subject to the provisions
of this article may issue  a  group  contract,  provided  the  group  of
persons  thereby covered conforms to the requirements of subsections (c)
and  (d)  of  section  four  thousand  two  hundred  thirty-five  or  of
subparagraph  (C)  of  paragraph three of subsection (a) of section four
thousand two hundred thirty-seven of this  chapter,  and  provided  such
contract  and the individual certificates issued to members of the group
shall comply in substance with this article. A  corporation  subject  to
the  provisions of this article shall issue to the group contractholder,
for delivery to each  member  of  the  insured  group,  a  copy  of  the
contract, or a certificate which can be in the form of a booklet setting
forth  in  summary  form  a  statement  of the essential features of the
insurance coverage. A group contract issued  pursuant  to  this  section
shall be subject to subsections (k) and (l) of section four thousand two
hundred thirty-five of this chapter.
(b) Any such contract which provides for the adjustment of the rate of
premium  based upon the experience thereunder shall specify the duration
of the period of insurance thereunder;  such  period  shall  not  exceed
three  years, provided, however, that such contract may provide that, in
the absence of one month's prior written notice by either party  to  the
other,  it  shall  be  automatically  renewed  at the termination of any
period thereunder for a succeeding period of not less than one nor  more
than  three  years'  duration.  In any case where such contract is for a
period of more than one year, an appropriate additional rate of  premium
shall  be  charged  therefor.  Any  such  contract  may  provide for the
adjustment of the rate of premium based upon the  experience  thereunder
at  the end of the first period of insurance thereunder or at the end of
any subsequent period of insurance thereunder and  any  such  adjustment
may  be  made  retroactive  only for the period of insurance immediately
preceding such adjustment.
(c) (1)(A) Any  such  contract  may  provide  that  benefits  will  be
furnished  to  a member of a covered group, for the member, the member's
spouse, child or children, or other persons chiefly dependent  upon  the
member for support and maintenance; provided that:
(i)  a  contract  of hospital, medical, surgical, or prescription drug
expense insurance that provides coverage for children shall provide such
coverage to a  married  or  unmarried  child  until  attainment  of  age
twenty-six,  without  regard to financial dependence, residency with the
member, student status, or employment,  except  a  contract  that  is  a
grandfathered  health  plan may, for plan years beginning before January
first, two thousand fourteen, exclude coverage of an adult  child  under
age twenty-six who is eligible to enroll in an employer-sponsored health
plan  other  than  a group health plan of a parent. For purposes of this
item,  "grandfathered  health  plan"  means  coverage  provided   by   a
corporation  in  which an individual was enrolled on March twenty-third,
two thousand ten for as long as  the  coverage  maintains  grandfathered
status in accordance with section 1251(e) of the Affordable Care Act, 42
U.S.C. § 18011(e); and
(ii)  a  contract  under  which coverage terminates at a specified age
shall,  with  respect  to  an  unmarried  child  who  is  incapable   of
self-sustaining  employment  by  reason of mental illness, developmental
disability, as defined in the mental hygiene law, or  physical  handicap
and  who  became  so  incapable  prior to attainment of the age at which
coverage would otherwise terminate and who  is  chiefly  dependent  upon
such  member  for  support  and  maintenance, not so terminate while the
contract remains in force and the child remains in  such  condition,  if
the  member has within thirty-one days of such child's attainment of the

termination age submitted proof of such child's incapacity as  described
herein.
(B)  In  addition  to  the  requirements  of  subparagraph (A) of this
paragraph, every corporation  issuing  a  group  contract  of  hospital,
medical  or  surgical  expense  insurance  pursuant to this section that
provides coverage for children, must make available and if requested  by
the  contractholder, extend coverage under that contract to an unmarried
child through age twenty-nine, without regard  to  financial  dependence
who is not insured by or eligible for coverage under any employer health
benefit  plan as an employee or member, whether insured or self-insured,
and who lives, works or resides in New York state or the service area of
the corporation. Such coverage shall be made available at the  inception
of  all  new  contracts  and  with respect to all other contracts at any
anniversary date. Written notice of the availability  of  such  coverage
shall  be delivered to the contractholder prior to the inception of such
group contract and annually thereafter.
(C) Notwithstanding any rule, regulation or law to the  contrary,  any
contract  under  which  a  member  elects  coverage  for the member, the
member's spouse, children or other persons chiefly  dependent  upon  the
member  for  support  and  maintenance  shall  provide  that coverage of
newborn infants, including newly born infants adopted by the  member  if
such  member  takes  physical  custody  of the infant upon such infant's
release from the hospital and files a petition pursuant to  section  one
hundred  fifteen-c  of  the domestic relations law within thirty days of
birth; and provided further that no notice of revocation to the adoption
has been filed pursuant to section one hundred fifteen-b of the domestic
relations law and consent to the adoption has not been revoked, shall be
effective from the moment of birth for injury or sickness including  the
necessary  care  and treatment of medically diagnosed congenital defects
and birth abnormalities including premature birth, except that in  cases
of adoption, coverage of the initial hospital stay shall not be required
where  a  birth parent has insurance coverage available for the infant's
care. This provision regarding coverage of  newborn  infants  shall  not
apply  to  two  person coverage. In the case of individual or two person
coverages the corporation must  also  permit  the  person  to  whom  the
certificate is issued to elect such coverage of newborn infants from the
moment of birth. If notification and/or payment of an additional premium
or  contribution  is  required  to make coverage effective for a newborn
infant, the coverage may provide that such notice and/or payment be made
within no less than thirty days of the day of  birth  to  make  coverage
effective  from the moment of birth. This election shall not be required
in the case of student insurance or where  the  group's  plan  does  not
provide coverage for children.
(2)  Any  such  contract under which coverage of a dependent spouse or
group member would terminate upon such spouse or group member  attaining
the  age  prescribed  in subchapter XVIII of the Social Security Act, 42
U.S.C. § 1395 et seq. ("Medicare"), as the age of first eligibility  for
the  benefits  provided  by  such  law  shall  not so terminate, if such
dependent spouse is not then eligible for all of such benefits,  for  as
long  as the contract remains in force and such dependent spouse remains
ineligible to receive any of such "Medicare" benefits, provided proof of
such ineligibility is submitted to  the  corporation  within  thirty-one
days  of  the  date  notice  of termination of coverage is sent by first
class mail  by  the  corporation  to  the  last  known  address  of  the
policyholder.
(d)  (1)  (A)  A  group contract issued pursuant to this section shall
contain a provision to the effect that  in  case  of  a  termination  of
coverage  under  such contract of any member of the group because of (i)

termination for any reason whatsoever  of  the  member's  employment  or
membership,  or  (ii) termination for any reason whatsoever of the group
contract itself unless the group contract holder has replaced the  group
contract with similar and continuous coverage for the same group whether
insured  or self-insured, the member shall be entitled to have issued to
the member by the corporation, without evidence  of  insurability,  upon
application  therefor  and  payment  of  the  first  premium made to the
corporation within sixty days after  termination  of  the  coverage,  an
individual  direct  payment  contract,  covering  such  member  and  the
member's eligible dependents who were covered  by  the  group  contract,
which  provides  coverage  that  contains  the essential health benefits
package described in paragraph three of subsection (e) of  section  four
thousand  three  hundred  six-h  of  this article. The corporation shall
offer one contract at each level of coverage as  defined  in  subsection
(b)  of  section  four thousand three hundred six-h of this article. The
member  may  choose  any  such  contract  offered  by  the  corporation.
Provided,   however,   the   superintendent   may,   after   giving  due
consideration to the public  interest,  approve  a  request  made  by  a
corporation  for  the  corporation  to  satisfy the requirements of this
subparagraph through the offering of contracts  that  comply  with  this
subparagraph  by  another  corporation,  insurer  or  health maintenance
organization within the corporation's same holding  company  system,  as
defined in article fifteen of this chapter.
(B)  The conversion privilege afforded in this paragraph shall also be
available: (i) upon the divorce  or  annulment  of  the  marriage  of  a
member,  to  the  divorced  spouse or former spouse of such member; (ii)
upon the death  of  the  member,  to  the  surviving  spouse  and  other
dependents  covered  under  the contract; and (iii) to a dependent if no
longer within the definition in the contract.
(2) The effective date of the  coverage  provided  by  the  individual
direct  payment  contract  shall  be  the date of the termination of the
individual's coverage under the group contract.  The  corporation  shall
not  be  required  to  issue  such  individual  direct payment converted
contract covering any person if it appears that such person  shall  then
be  covered by another individual contract providing similar coverage or
if it shall appear that such person is covered  by  or  eligible  to  be
covered  by  a group contract or policy providing similar benefits or is
provided with similar benefits required by any statute  or  provided  by
any  welfare  plan or program, which together with the individual direct
payment converted contract would result in over-insurance or duplication
of benefits according to standards on file with  the  superintendent  of
financial services relating to individual contracts.
(3)  (A)  Each  member  in  the insured group, but not his dependents,
shall be given written notice of such conversion privilege  provided  in
paragraph one hereof and its duration within fifteen days after the date
of  termination  of  coverage under the group contract, provided that if
such notice be given more than fifteen days but less  than  ninety  days
after  the  date of termination of coverage under the group contract the
time allowed for the exercise of  such  conversion  privilege  shall  be
extended  for  forty-five  days after the giving of such notice. If such
notice is not given within ninety days after the date of termination  of
coverage  under  the group contract the time allowed for the exercise of
such conversion privilege shall expire at the end of such ninety days.
(B) Written notice by the contract holder given to the member or  sent
by  first class mail to the member at his last known address, or written
notice by the corporation which issued the group contract sent by  first
class  mail  to  the  member  at  the  last  address  furnished  to  the

corporation by the contract holder, shall be deemed full compliance with
the provisions of this paragraph for the giving of notice.
(C)  A  group  contract  issued pursuant to this section may contain a
provision to the effect that notice of such conversion privilege and its
duration shall be given by  the  contract  holder  to  each  certificate
holder upon termination of his group coverage.
(4)  A  group  contract  to  be  issued  to a social services district
pursuant to section three hundred sixty-five of the social services  law
by  a  corporation  subject  to the provisions of this article need not,
subject to the approval of the superintendent, provide for the  issuance
of  individual  certificates  and  may  omit  or modify any of the other
provisions required to be contained in such contract, provided that  the
superintendent  deems  such  omission  or  modification suitable for the
character of the coverage provided.
(5) For purposes  of  this  subsection,  the  term  "dependent"  shall
include a child as described in subsection (c) of this section.
(e) In addition to the conversion privilege afforded by subsection (d)
of  this  section, a group contract issued by a hospital service, health
service or medical expense indemnity corporation shall provide  that  if
all  or  any  portion  of the insurance on an employee or member insured
under  the  policy  ceases  because  of  termination  of  employment  or
membership  in  the  class  or  classes  eligible for coverage under the
policy, such employee or member shall be entitled  without  evidence  of
insurability  upon  application to continue his insurance for himself or
herself and his or her eligible dependents, subject to all of the  group
contract's  terms  and  conditions applicable to those forms of benefits
and to the following conditions:
(1) Continuation shall cease on the date which the employee, member or
dependant first becomes, after the date of  election:  (A)  entitled  to
coverage  under  title  XVIII  of  the United States Social Security Act
(Medicare) as amended or superseded; or  (B)  covered  as  an  employee,
member  or dependent by any other insured or uninsured arrangement which
provides hospital, surgical or medical coverage  for  individuals  in  a
group which does not contain any exclusion or limitation with respect to
any pre-existing condition of such employee, member or dependent.
(2) (A) An employee or member who wishes continuation of coverage must
request  such  continuation  in  writing  within  the  sixty  day period
following the later of: (i) the date of such termination;  or  (ii)  the
date  the  employee  is  sent notice by first class mail of the right of
continuation by the group policyholder.
(B) An employee or member who wishes continuation  of  coverage  under
subparagraph  (D)  of paragraph four of this subsection must give notice
to  the  employer  or  group  policyholder  within  sixty  days  of  the
determination  under  title  II or title XVI of the United States Social
Security Act that such employee or member was disabled at  the  time  of
termination  of employment or membership or at any time during the first
sixty days of continuation of coverage.
(3) An employee or member electing continuation must pay to the  group
policyholder  or his employer, but not more frequently than on a monthly
basis in advance, the amount of the required premium  payment,  but  not
more  than  one  hundred  two percent of the group rate for the benefits
being continued under the  group  contract  on  the  due  date  of  each
payment.  The  employee's  or member's written election of continuation,
together with the first premium payment required  to  establish  premium
payment on a monthly basis in advance, must be given to the policyholder
or  employer  within  sixty  days of the date the employee's or member's
benefits would otherwise terminate.
(4) Subject to paragraph  one  of  this  subsection,  continuation  of
benefits  under the group contract for any person shall terminate at the
first to occur of the following:
(A)  The  date  thirty-six  months  after  the  date the employee's or
member's benefits under the contract  would  otherwise  have  terminated
because of termination of employment or membership; or
(B) The end of the period for which premium payments were made, if the
employee  or  member  fails to make timely payment of a required premium
payment; or
(C) In the case of an eligible dependent of an employee or member, the
date thirty-six months after the date such person's benefits  under  the
contract would otherwise have terminated by reason of:
(i) the death of the employee or member;
(ii)  the  divorce  or legal separation of the employee or member from
his or her spouse;
(iii) the employee or member becoming entitled to benefits under title
XVIII of the United States Social Security Act (Medicare); or
(iv) a dependent child ceasing to  be  a  dependent  child  under  the
generally applicable requirements of the contract; or
(D) The date on which the group contract is terminated or, in the case
of an employee, the date his employer terminated participation under the
group contract. However, if this clause applies and the coverage ceasing
by  reason  of  such  termination  is replaced by similar coverage under
another group contract, the following shall apply:
(i) The employee or member shall have  the  right  to  become  covered
under  that  other group contract, for the balance of the period that he
would have remained covered under the prior group contract in accordance
with this subparagraph had a termination described in this  subparagraph
not occurred, and
(ii)  The  minimum level of benefits to be provided by the other group
contract shall be the applicable level of benefits of  the  prior  group
contract reduced by any benefits payable under the prior group contract,
and
(iii)  The  prior group contract shall continue to provide benefits to
the extent of its accrued liabilities and extensions of benefits  as  if
the replacement had not occurred.
(5)  A  notification of the continuation privilege and the time period
in which to request continuation shall be included in  each  certificate
of coverage.
(6)  The  conversion  privilege  afforded  by  subsection  (d) of this
section shall be available  upon  termination  of  the  continuation  of
benefits described herein.
(7)  This  subsection  shall  not  be  applicable where a continuation
benefit is available to the employee or member pursuant to Chapter 18 of
the Employee Retirement Income Security Act, 29 U.S.C. § 1161 et seq  or
Chapter  6A  of the Public Health Service Act, 42 U.S.C. § 300 bb - 1 et
seq. However, a group contract shall offer an employee or member who has
exhausted continuation coverage pursuant to Chapter 18 of  the  Employee
Retirement  Income  Security Act, 29 U.S.C. § 1161 et seq. or Chapter 6A
of the Public Health Service Act, 42 U.S.C. § 300 bb -  1  et  seq.  the
opportunity  to  continue  coverage for up to thirty-six months from the
date the employee's or  member's  continuation  coverage  began  if  the
employee  or  member  is  entitled  to  less  than  thirty-six months of
continuation benefits.
(8)(A) Special enrollment period. An individual who does not  have  an
election  of  continuation  coverage  as described in this subsection in
effect on the effective date of the American Recovery  and  Reinvestment
act  of  2009,  but who would be an assistance eligible individual under

Title III of such act  if  such  election  were  in  effect,  may  elect
continuation coverage pursuant to this subsection. Such election must be
made  no  later  than sixty days after the date the administrator of the
group  health  plan  (or  other  entity  involved)  provides  the notice
required by section 3001(a)(7) of the American Recovery and Reinvestment
act of 2009. The administrator of the group health plan (or other entity
involved) shall provide such individuals with additional notice  of  the
right  to elect coverage pursuant to this paragraph within sixty days of
the date of enactment of the American Recovery and Reinvestment  act  of
2009.
(B) Continuation coverage elected pursuant to subparagraph (A) of this
paragraph  shall commence with the first period of coverage beginning on
or after the  date  of  the  enactment  of  the  American  Recovery  and
Reinvestment  act  of  2009  and  shall  not extend beyond the period of
continuation coverage that would have been required if the coverage  had
instead been elected pursuant to paragraph two of this subsection.
(C)  With  respect  to  an individual who elects continuation coverage
pursuant to subparagraph (A) of this paragraph, the period beginning  on
the  date  of  the  qualifying event and ending on the date of the first
period of coverage on or after the enactment of  the  American  Recovery
and  Reinvestment  act  of  2009  shall  be  disregarded for purposes of
determining the sixty-three day  period  referred  to  in  section  four
thousand three hundred eighteen of this article.
(9)  For  purposes  of  this  subsection,  the  term "dependent" shall
include a child as described in subsection (c) of this section.
(f) Any contract and certificate, other than one issued in fulfillment
of the continuing care responsibilities of an operator of  a  continuing
care  retirement  community  in accordance with article forty-six of the
public health law, made available because of residence in  a  particular
facility,  housing development, or community shall contain the following
notice in twelve point type in bold face on the first page:
"NOTICE - THIS CONTRACT (CERTIFICATE) DOES NOT MEET  THE  REQUIREMENTS
OF  A CONTINUING CARE RETIREMENT CONTRACT. AVAILABILITY OF THIS COVERAGE
WILL NOT QUALIFY A RESIDENTIAL FACILITY AS A CONTINUING CARE  RETIREMENT
COMMUNITY."
(g)  In  addition  to  all  the  rights of conversion and continuation
otherwise provided for herein, employees or members  insured  under  the
contract who are also members of a reserve component of the armed forces
of the United States, including the National Guard, shall be entitled to
have   supplementary  conversion  and  continuation  rights  in  certain
circumstances as follows:
(1) if the employee or member  insured  enters  upon  active  duty  as
defined  in  subsection  (h)  of this section, and the employer or group
contract holder does not voluntarily maintain coverage for such employee
or member insured, the employee or member insured shall be  entitled  to
have  his  or  her  coverage  continued  under  the  group  contract  in
accordance with the conditions and limitations  contained  in  paragraph
seven  of  this  subsection  and have issued at the end of the period of
continuation an individual conversion policy subject  to  the  terms  of
this  subsection.  The effective date for the conversion policy shall be
the day following the termination of insurance under the  group  policy,
or  if there is a continuation of coverage, on the day following the end
of the period of continuation.
(2) if the employer or group  contract  holder  does  not  voluntarily
maintain  coverage  for the employee or member insured during the period
of active duty, and such employee or member insured does not  elect  the
supplementary  conversion  and  continuation rights provided for herein,

coverage for such employee or member insured shall be  suspended  during
the period of active duty.
(3)  if  the  employee  or  member  insured  elects  the supplementary
continuation right provided for herein or coverage under the group  plan
is suspended, and such employee or member insured dies during the period
of  active  duty, the conversion right provided by this section shall be
available to the surviving spouse and children, and shall  be  available
to  a  child  solely  with respect to himself or herself upon his or her
attaining the limiting age of coverage under the  group  contract  while
covered  as  a dependent thereunder. It shall also be available upon the
divorce or annulment of the marriage of the employee or member  insured,
to the former spouse of such employee or member insured, if such divorce
or annulment occurs during the period of active duty.
(4)  if  the  employee  or  member  insured  elects  the supplementary
conversion and continuation right provided for herein or coverage  under
the  group  plan  is  suspended,  and such employee or member insured is
either reemployed or restored to participation in the group upon  return
to  civilian status, he or she shall be entitled to resume participation
in insurance offered by the group pursuant  to  this  section,  with  no
limitations  or  conditions imposed as a result of such period of active
duty except as set forth in subparagraphs (A) and (B) herein. The  right
of  resumption  provided  for  herein  shall  extend to coverage for the
spouse and dependents of the employee or member insured and shall be  in
addition  to other existing rights granted pursuant to state and federal
laws and regulations and shall not be deemed to qualify  or  limit  such
rights  in  any  way.  No  exclusion or waiting period may be imposed in
connection with coverage of a health or physical condition of  a  person
entitled  to such right of resumption, or a health or physical condition
of any other person who is covered by the policy unless:
(A) the condition arose during the  period  of  active  duty  and  the
condition has been determined by the secretary of veterans affairs to be
a condition incurred in the line of duty; or
(B)  a  waiting period was imposed and had not been completed prior to
the period of suspension; in no event, however, shall  the  sum  of  the
waiting  periods  imposed  prior  to  and  subsequent  to  the period of
suspension exceed the length of the waiting period originally imposed.
(5) if  the  employee  or  member  insured  elects  the  supplementary
conversion and continuation coverage provided for herein:
(A)  when  such  employee  or  member  insured is either reemployed or
restored to participation in the group, coverage under the supplementary
rights provided for herein shall terminate on the date that coverage  is
effective due to resumption of participation in the group.
(B) when such employee or member insured is not reemployed or restored
to  participation in the group upon return to civilian status, he or she
shall be entitled to the conversion and continuation rights provided  by
subsections (d) and (e) of this section.
(i)  To elect an individual conversion contract pursuant to subsection
(d) of this section, the employee or member insured must  apply  to  the
insurer  within  thirty-one  days  of  the termination of active duty or
discharge from hospitalization  incident  to  such  active  duty,  which
hospitalization  continues  for a period of not more than one year. Upon
commencement of coverage under the conversion right provided pursuant to
subsection  (d)  of  this  section,  coverage  under  the  supplementary
continuation right provided for herein shall terminate.
(ii)  To  elect continuation of coverage pursuant to subsection (e) of
this  section,  the  employee  or  member  insured  must  request   such
continuation  of  the employer within thirty-one days of the termination
of active duty or discharge from hospitalization incident to such active

duty, which hospitalization continues for a period of not more than  one
year.  Upon  commencement  of  coverage  under  the  continuation  right
provided pursuant to subsection (e) of this section, coverage under  the
supplementary  continuation  right  provided for herein shall terminate.
The employee or member insured shall be entitled to have issued  at  the
end of the period of continuation an individual conversion contract.
(6) if coverage under the group plan is suspended during the period of
active duty:
(A)  when  the  employee or member insured returns to participation in
the group plan, coverage under the group plan shall  be  retroactive  to
the date of termination of the period of active duty.
(B) when such employee or member insured is not reemployed or restored
to  participation in the group upon return to civilian status, he or she
shall be entitled to the conversion and continuation rights provided  by
subsections (d) and (e) of this section.
(i)  To elect an individual conversion contract pursuant to subsection
(d) of this section, the employee or member insured must  apply  to  the
insurer  within  thirty-one  days  of  the termination of active duty or
discharge from hospitalization  incident  to  such  active  duty,  which
hospitalization continues for a period of not more than one year.
(ii)  To  elect continuation of coverage pursuant to subsection (e) of
this  section,  the  employee  or  member  insured  must  request   such
continuation  of  the employer within thirty-one days of the termination
of active duty or discharge from hospitalization incident to such active
duty, which hospitalization continues for a period of not more than  one
year. The employee or member insured shall be entitled to have issued at
the end of the period of continuation an individual conversion contract.
(7)  A  group contract providing hospital, surgical or medical expense
insurance for other than accident only shall provide that if all or  any
portion  of  the  insurance  on  an employee or member insured under the
contract ceases because the employee or member  insured  is  ordered  to
active  duty as defined in subsection (h) of this section, such employee
or member insured shall be entitled, without evidence  of  insurability,
upon  application  to  continue his or her hospital, surgical or medical
expense insurance for  himself  or  herself  and  his  or  her  eligible
dependents,  under  the supplementary conversion and continuation rights
provided for herein, subject to all of  the  group  policy's  terms  and
conditions  applicable  to  those forms of benefits and to the following
conditions:
(A) continuation shall cease on the date which the employee, member or
dependant first becomes, after the date of  election:  (i)  entitled  to
coverage  under  title  XVIII  of  the United States Social Security Act
(Medicare) as amended or superseded or  (ii)  covered  as  an  employee,
member  or dependent by any other insured or uninsured arrangement which
provides hospital, surgical or medical coverage  for  individuals  in  a
group,  except that the coverage available to active duty members of the
uniformed services and their family members shall not  be  considered  a
group  under  the  terms  of  this  subsection and except that the group
insurance contract conversion  option  of  this  section  shall  not  be
considered  as  such  an  arrangement under which an employee, member or
dependent could become covered.
(B) an employee or member insured who wishes continuation of  coverage
pursuant  to  this  subsection must request such continuation in writing
within sixty days of being ordered to active duty.
(C) an employee or member insured electing  continuation  pursuant  to
this  subsection  must  pay  to  the group contract holder or his or her
employer, but not more frequently than on a monthly  basis  in  advance,
the  amount of the required premium payment, but not more than the group

rate for the benefits being continued under the group  contract  on  the
due date of each payment.
(8)  The supplementary conversion and continuation rights provided for
herein shall apply to:
(A) contracts not covered by Chapter 18  of  the  Employee  Retirement
Income  Security Act, 29 U.S.C. section 1161 et seq or Chapter 6A of the
Public Health Service Act, 42 U.S.C. section 300bb-1 et seq;
(B) contracts covered by Chapter 18 of the Employee Retirement  Income
Security  Act, 29 U.S.C. section 1161 et seq or Chapter 6A of the Public
Health Service Act, 42 U.S.C. section 300bb-1 et seq, when  active  duty
for  reservists  and  the refusal of an employer to voluntarily maintain
coverage for such period of active duty is not considered  a  qualifying
event.
(h)  To  be  entitled  to  the right defined in subsection (g) of this
section a person must be a member of a reserve component  of  the  armed
forces of the United States, including the National Guard, who either:
(1)  voluntarily  or involuntarily enters upon active duty (other than
for the purpose of determining his or her  physical  fitness  and  other
than for training), or
(2)  has  his or her active duty voluntarily or involuntarily extended
during a period when the president is authorized to order units  of  the
ready reserve or members of a reserve component to active duty, provided
that  such  additional  active  duty  is  at  the  request  and  for the
convenience of the federal government, and
(3) serves no more than four years of active duty.
(j)(1) Except as provided in this section, if a  corporation  delivers
or  issues  for delivery in this state a group or blanket contract which
provides hospital, surgical or medical expense coverage for  other  than
accident  only,  the  corporation  must  renew or continue in force such
coverage at the option of the contract holder.
(2) A corporation may nonrenew or discontinue coverage  under  such  a
group or blanket contract based only on one or more of the following:
(A)  The  contract  holder or a participating entity has failed to pay
premiums or contributions in accordance with the terms of  the  contract
or the corporation has not received timely premium payments.
(B) The contract holder or a participating entity has performed an act
or   practice   that   constitutes   fraud   or   made   an  intentional
misrepresentation of material fact under the terms of the contract.
(C) The contract holder has failed to  comply  with  a  material  plan
provision  relating  to  employer  contribution  or  group participation
rules, as permitted under section four thousand two hundred  thirty-five
of this chapter.
(D)  The corporation is ceasing to offer group or blanket contracts in
a market in accordance with paragraph three or  paragraph  six  of  this
subsection.
(E)  The  contract  holder ceases to meet the requirements for a group
under section four thousand two hundred thirty-five of this chapter or a
participating employer, labor union, association or other entity  ceases
membership  or  participation  in  the  group  to  which the contract is
issued. Coverage terminated pursuant to this  paragraph  shall  be  done
uniformly without regard to any health status-related factor relating to
any covered individual.
(F)  In  the  case  of  a  corporation  that offers a group or blanket
contract in a market through a network plan,  there  is  no  longer  any
enrollee in connection with such plan who lives, resides or works in the
operating  area  of  the  corporation  (or  in  the  area  for which the
corporation is authorized to do business).
(G) Such other reasons as are acceptable  to  the  superintendent  and
authorized by the Health Insurance Portability and Accountability Act of
1996,  Public  Law  104-191,  and  any  later  amendments  or  successor
provisions, or by any federal regulations or rules  that  implement  the
provisions of the Act.
(3)  (A)  In  any  case  in which a corporation decides to discontinue
offering a particular class of group or blanket  contract  of  hospital,
surgical  or  medical  expense  insurance  offered in the small or large
group market, the contract of such class  may  be  discontinued  by  the
corporation in accordance with this chapter in such market only if:
(i)  the  corporation  provides written notice to each contract holder
provided coverage of this class in such market (and to all employees and
member insureds covered under such coverage) of such  discontinuance  at
least  ninety days prior to the date of discontinuance of such coverage.
In addition  to  any  other  information  required  of  notices  by  the
superintendent,  this  written  notice  shall  conspicuously  include an
explanation, in plain language, of the  contract  holder's  and  covered
employee's  or  member  insured's  rights  under  this  subparagraph and
subparagraph (B) of this paragraph, including:
(I) a statement that if the superintendent determines that the covered
employee,  member  insured,  or  a  dependent  has  a  serious   medical
condition,  and the covered employee, member insured or dependent within
the previous twelve  months  utilized  a  benefit  under;  the  contrary
related  to  the  serious  medical  condition that is not covered by the
replacement coverage offered to the contract holder as a result  of  the
discontinuance, then the superintendent shall require the corporation to
offer  the  contract holder replacement coverage that includes a benefit
that is the same as or substantially similar to the benefit set forth in
the contract that the corporation discontinued; and
(II) an explanation as to how to contact the superintendent,  and  the
date  by  which  the  superintendent shall be contacted, if the contract
holder, covered employee or member insured  believes  that  the  covered
employee, member insured or a dependent has a serious medical condition,
and  the  covered  employee,  member  insured  or  dependent  within the
previous twelve months utilized a benefit related to the serious medical
condition that may not be covered by the replacement coverage offered to
the contract holder as a result of the discontinuance;
(ii) the corporation offers to each contract holder provided  coverage
of  this  class  in  such market, the option to purchase all (or, in the
case of the large  group  market,  any)  other  hospital,  surgical  and
medical expense coverage currently being offered by the corporation to a
group in such market;
(iii)  in  exercising the option to discontinue coverage of this class
and in  offering  the  option  of  coverage  under  item  (ii)  of  this
subparagraph,  the  corporation  acts  uniformly  without  regard to the
claims experience of those contract holders or any health status-related
factor relating to any particular covered employee,  member  insured  or
dependent who may become eligible for such coverage, and the corporation
is  not discontinuing the coverage of this class with the intent or as a
pretext to discontinuing the  coverage  of  any  such  employee,  member
insured or dependent; and
(iv)  at least ninety days prior to the date of discontinuance of such
coverage, the corporation provides written notice to the  superintendent
of such discontinuance, including the reason for the discontinuance, and
an   officer   or   director   of   the  corporation  certifies  to  the
superintendent that the corporation has complied with  items  (i),  (ii)
and (iii) of this paragraph. If such notice does not include the date or
dates  that  the  corporation  mailed  or  delivered  the  notice to all

contract holders, covered employers and member insureds, the corporation
shall notify the superintendent of such date within seven  days  of  the
completion of the mailing or delivery.
(B)  If  the  superintendent  determines  that the corporation has not
complied with item (iii) of subparagraph (A) of this paragraph, then the
superintendent may prohibit the corporation from discontinuing the class
of contracts and  require  the  corporation  to  promptly  notify  every
contract   holder,   covered   employee  and  member  insured  that  the
corporation is not discontinuing the contracts.  If  the  superintendent
determines  that  the  corporation  wrongfully discontinued the class of
contracts  pursuant  to  item  (iii)  of  subparagraph  (A),  then   the
superintendent  shall require that the corporation take remedial action,
including offering to group contract holders the option  of  reinstating
the  discontinued  contract forms. If the superintendent determines that
the corporation discontinued the class of contracts  without  compliance
with  items  (i),  (ii),  or  (iv) of subparagraph (A), and an employee,
member insured or dependent  covered  under  the  discontinued  contract
would  have  been  entitled  to  relief  under  this paragraph, then the
superintendent  may  require  that  the  corporation  offer  replacement
coverage  to  an  affected  contract holder consistent with item (ii) of
subparagraph (C) of this paragraph.
(C) (i) If, within forty-five days  after  the  corporation  mails  or
delivers  the  written  notice of discontinuance required by item (i) of
subparagraph (A) of this paragraph, the superintendent is notified by  a
contract  holder  or  covered  employee or member insured that a covered
employee, member insured or dependent has a  serious  medical  condition
and  that  a benefit utilized by the covered employee, member insured or
dependent within the previous  twelve  months  related  to  the  serious
medical condition may not be covered by the replacement coverage offered
to  the  contract  holder  as  a  result of the discontinuance, then the
superintendent shall, within twenty days of the  notification,  ask  the
corporation  to  confirm  that  the  covered employee, member insured or
dependent utilized a benefit within the previous twelve months to  treat
the  medical  condition  that  the  covered  employee, member insured or
dependent asserts is a serious medical condition, and that  the  benefit
is  not  covered  by  the  replacement  coverage. The superintendent may
request such additional information as the superintendent  may  require.
The   corporation   shall  provide  all  requested  information  to  the
superintendent within five days of receipt of the request.
(ii) If, within twenty days of the  superintendent's  receipt  of  all
additional    information    requested   from   the   corporation,   the
superintendent determines that (I) the covered employee, member  insured
or  dependent  has  a  serious  medical  condition; and (II) the benefit
utilized by the covered employee, member insured or dependent within the
previous twelve months related to the serious medical condition  is  not
covered  by the replacement coverage offered to the contract holder as a
result of the discontinuance, then the superintendent shall require  the
corporation  to  offer  to the contract holder replacement coverage that
includes a benefit that is the same as or substantially similar  to  the
benefit  set forth in the contract that the corporation discontinued. If
the replacement coverage is not available, at the time that the contract
would otherwise be discontinued, then the  corporation  shall  keep  the
existing  policy  in  force  for  the affected contract holder until the
replacement  coverage  with  the  substantially   similar   benefit   is
available.
(D) The remedies as provided in this paragraph shall be in addition to
and not in lieu of any other authority or power of the superintendent to
impose monetary or other penalties for violations of this paragraph.
(E)  In any case in which a corporation elects to discontinue offering
all hospital, surgical and medical expense coverage in the  small  group
market or the large group market, or both markets, in this state, health
insurance coverage may be discontinued by the corporation only if:
(i)  the corporation provides written notice to the superintendent and
to each contract holder (and all employees and member  insureds  covered
under  such coverage) of such discontinuance at least one hundred eighty
days prior to the date of the discontinuance of such coverage;
(ii) all hospital, surgical and medical  expense  coverage  issued  or
delivered  for  issuance  in  this  state  in  such market or markets is
discontinued and coverage under such contracts in such market or markets
is not renewed; and
(iii) in addition to the notice to the superintendent referred  to  in
item  (i)  of  this  subparagraph,  the  corporation  shall  provide the
superintendent with a written plan to minimize potential  disruption  in
the  marketplace  occasioned  by  the  corporation's withdrawal from the
market.
(F) In the case of a discontinuance under  subparagraph  (E)  of  this
paragraph  in a market, the corporation may not provide for the issuance
of any group or  blanket  contract  of  hospital,  surgical  or  medical
expense  insurance  in  that  market  in this state during the five-year
period beginning on the date of the discontinuance of  the  last  health
insurance contract not so renewed.
(4)  At the time of coverage renewal, an insurer may modify the health
insurance coverage for a group or blanket contract offered to a large or
small group contract holder so long as such modification  is  consistent
with this chapter and effective on a uniform basis among all small group
contract holders with that contract.
(5) For purposes of this subsection the term "network plan" shall mean
a  health  insurance  contract under which the financing and delivery of
health care (including items and services paid for  as  such  care)  are
provided,  in whole or in part, through a defined set of providers under
contract  either  with  the  corporation  or  another  entity  that  has
contracted with the corporation.
(6)  Notwithstanding paragraph three of this subsection, a corporation
may discontinue offering a particular class of group or blanket contract
of hospital, surgical or medical expense insurance offered in the  small
or  large group market, and instead offer a group or blanket contract of
hospital, surgical or medical expense insurance that complies  with  the
requirements of section 2707 of the public health service act, 42 U.S.C.
§  300gg-6  that become applicable to such contract as of January first,
two thousand fourteen, provided that the corporation:
(A) discontinues the existing class of contract in such market  as  of
either  December  thirty-first,  two  thousand  thirteen or the contract
renewal date occurring in two thousand fourteen in accordance with  this
chapter;
(B)  provides written notice to each contract holder provided coverage
of the class in the market (and to all  employees  and  member  insureds
covered  under such coverage) of the discontinuance at least ninety days
prior to the date of discontinuance of such coverage. The written notice
shall be in a form satisfactory to the superintendent;
(C) offers to each contract holder provided coverage of the  class  in
the  market,  the  option  to purchase all (or, in the case of the large
group market, any) other hospital, surgical and medical expense coverage
that complies with the requirements of section 2707 of the public health
service act, 42 U.S.C. § 300gg-6 that become applicable to such coverage
as of January first, two thousand fourteen, currently being  offered  by
the corporation to a group in that market;
(D)  in exercising the option to discontinue coverage of the class and
in offering the option  of  coverage  under  subparagraph  (C)  of  this
paragraph,  acts  uniformly  without  regard to the claims experience of
those contract holders or any health status-related factor  relating  to
any  particular  covered  employee,  member  insured  or  dependent,  or
particular new employee, member insured, or  dependent  who  may  become
eligible for such coverage, and does not discontinue the coverage of the
class  with  the intent or as a pretext to discontinuing the coverage of
any such employee, member insured, or dependent; and
(E) at least one  hundred  twenty  days  prior  to  the  date  of  the
discontinuance   of  such  coverage,  provides  written  notice  to  the
superintendent of the  discontinuance,  including  certification  by  an
officer  or  director  of  the  corporation  that  the  reason  for  the
discontinuance is  to  replace  the  coverage  with  new  coverage  that
complies  with  the  requirements  of  section 2707 of the public health
service act, 42 U.S.C. § 300gg-6 that become  effective  January  first,
two  thousand  fourteen.  The  written  notice shall be in such form and
contain such information the superintendent requires.
(k)(1) No corporation delivering or issuing for delivery in this state
a group or blanket contract which provides hospital, surgical or medical
expense  coverage  shall  establish  rules  for  eligibility  (including
continued  eligibility) of any individual or dependent of the individual
to enroll under the contract  based  on  any  of  the  following  health
status-related factors:
(A) Health status.
(B) Medical condition (including both physical and mental illnesses).
(C) Claims experience.
(D) Receipt of health care.
(E) Medical history.
(F) Genetic information.
(G) Evidence of insurability (including conditions arising out of acts
of domestic violence).
(H) Disability.
(2)  For  purposes  of  paragraph  one  of  this subsection, rules for
eligibility include rules defining any applicable  waiting  periods  for
such enrollment.
(3)  No  corporation  may,  on  the basis of any health status-related
factor in relation to the subscriber or  dependent  of  the  subscriber,
require  any  subscriber  (as  a  condition  of  enrollment or continued
enrollment under the contract) to pay a premium or contribution which is
greater than such premium for a similarly situated  subscriber  enrolled
in the plan.
(4)  Nothing in this subsection shall require a corporation to issue a
group or blanket contract to a group  comprised  of  fifty-one  or  more
lives exclusive of spouses and dependents.
(5)  Where an eligible subscriber or dependent of a subscriber rejects
initial  enrollment  in  a  group  or  blanket  contract  that  provides
hospital,  surgical  or  medical  expense insurance, a corporation shall
permit a subscriber or dependent of a subscriber to enroll for  coverage
under  the terms of the contract if each of the following conditions are
met:
(A) The subscriber or dependent was  covered  under  another  plan  or
contract at the time coverage was initially offered.
(B)(i)  Coverage was provided in accordance with continuation required
by federal or state law and was exhausted; or
(ii) Coverage under  the  other  plan  or  contract  was  subsequently
terminated  as  a  result  of loss of eligibility for one or more of the
following reasons:
(I) termination of employment;
(II) termination of the other plan or contract;
(III) death of the spouse;
(IV) legal separation, divorce or annulment;
(V) reduction in the number of hours of employment; or
(iii)  Contract holder contributions toward the payment of premium for
the other plan or contract were terminated.
(C) Coverage must be applied for within thirty days of termination for
one of the reasons set forth in subparagraph (B) of this paragraph.
(6) With respect to group or blanket contracts delivered or issued for
delivery in this state covering  between  two  and  fifty  employees  or
members,  the provisions of this subsection shall in no way diminish the
rights of such groups pursuant to section four  thousand  three  hundred
seventeen of this article.
(7)  For  purposes  of  this  subsection,  the  term "dependent" shall
include a child as described in subsection (c) of this section.
(l)(1) As used in this subsection, "child" means  an  unmarried  child
through  age  twenty-nine of an employee or member insured under a group
contract of hospital, medical or surgical expense insurance,  regardless
of  financial dependence, who is not insured by or eligible for coverage
under any employer health benefit plan as an employee or member, whether
insured or self-insured, and who lives, works or  resides  in  New  York
state  or  the  service  area  of the corporation and who is not covered
under title XVIII of the United States Social Security Act (Medicare).
(2) In addition to the conversion privilege afforded by subsection (d)
of this section and the continuation privilege  afforded  by  subsection
(e)  of  this  section,  a  hospital  service, health service or medical
expense corporation or health  maintenance  organization  that  provides
group  hospital,  medical or surgical coverage under which coverage of a
child terminates at a specified  age  shall,  upon  application  of  the
employee,  member  or  child,  as  set forth in subparagraph (B) of this
paragraph, provide coverage to the child after that  specified  age  and
through age twenty-nine without evidence of insurability, subject to all
of the terms and conditions of the group contract and the following:
(A)  An  employer shall not be required to pay all or part of the cost
of coverage for a child provided pursuant to this subsection;
(B) An employee, member or child who wishes to elect  continuation  of
coverage  pursuant  to this subsection shall request the continuation in
writing:
(i) within sixty days following  the  date  coverage  would  otherwise
terminate  due  to  reaching  the  specified  age set forth in the group
contract;
(ii) within sixty days after meeting the requirements for child status
set forth in paragraph one of this  subsection  when  coverage  for  the
child previously terminated; or
(iii) during an annual thirty-day open enrollment period, as described
in the contract;
(C) An employee, member or child electing continuation as described in
this  subsection  shall pay to the group contractholder or employer, but
not more frequently than on a monthly basis in advance,  the  amount  of
the  required  premium  payment  on  the  due  date of each payment. The
written election  of  continuation,  together  with  the  first  premium
payment  required  to  establish  premium  payment on a monthly basis in
advance, shall be given to the group contractholder or  employer  within
the  time  periods  set forth in subparagraph (B) of this paragraph. Any
premium received within the thirty-day period after the due  date  shall
be considered timely;
(D)  For any child electing coverage within sixty days of the date the
child would otherwise lose coverage due to reaching a specified age, the
effective date of the continuation coverage shall be the  date  coverage
would  have  otherwise  terminated.  For  any  child  electing to resume
coverage  during an annual open enrollment period, the effective date of
the continuation coverage shall be prospective no later than thirty days
after the election and payment of first premium;
(E) Coverage for a child pursuant to this subsection shall consist  of
coverage  that  is identical to the coverage provided to the employee or
member parent. If coverage is modified under the contract for any  group
of similarly situated employees or members, then the coverage shall also
be modified in the same manner for any child;
(F) Coverage shall terminate on the first to occur of the following:
(i)  the  date the child no longer meets the requirements of paragraph
one of this subsection;
(ii) the end of the period for which premium payments  were  made,  if
there  is a failure to make payment of a required premium payment within
the period of grace described in subparagraph (C) of this paragraph; or
(iii) the date on which the  group  contract  is  terminated  and  not
replaced by coverage under another group contract; and
(G)  The  corporation or health maintenance organization shall provide
written notification of the continuation  privilege  described  in  this
subsection  and  the time period in which to request continuation to the
employee or member:
(i) in each certificate of coverage; and
(ii) at least sixty days prior to termination at the specified age  as
provided in the contract.
(3)(A)  Corporations and health maintenance organizations shall submit
such reports as may be requested by the superintendent to  evaluate  the
effectiveness of coverage pursuant to this subsection including, but not
limited to, quarterly enrollment reports.
(B)  The  superintendent  may  promulgate  regulations  to  ensure the
orderly  implementation  and  operation  of  the  continuation  coverage
provided   pursuant   to   this   subsection,   including  premium  rate
adjustments.
(m) A health care claim from a subscriber  covered  under  a  contract
issued  pursuant  to  this section shall be submitted within one hundred
twenty days from the date of service; provided, however, that if it  was
not  reasonably  possible  for the subscriber to submit the claim within
that timeframe, then the claim shall be submitted as soon as  reasonably
possible.
(n) (1) Any corporation subject to the provisions of this article that
issues  hospital,  surgical  or  medical  expense contracts in the small
group or large group market in this state shall offer to any employer in
this state all such contracts in the applicable market, and shall accept
at all times throughout the year any employer that applies  for  any  of
those contracts.
(2)  The  requirements of paragraph one of this subsection shall apply
with respect to an employer that applies for  coverage  either  directly
from  the  corporation  or  through an association or trust to which the
corporation has issued coverage and in which the employer participates.