California Code of Regulations › Title 28 - Managed Health Care › Division 1 - The Department of Managed Health Care › Chapter 2 - Health Care Service Plans › Article 6 - Appeals on Cancellation › Section 1300.65.3 - Cancellations or Nonrenewals for Nonpayment of Premiums: APTC Enrollee

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
(a) General
				  Requirements
(1) Applicability. This section
				  shall apply to all cancellations and nonrenewals for nonpayment of premiums for
				  an enrollee who is receiving the APTC through the PPACA, section
				  1401 (26 U.S.C. §
												36B), pursuant to Health and Safety Code
				  section
				  1365(a)(1)(A).
(2) Federal Grace Period
(A) To qualify for the federal grace period,
				  as defined in California Code of Regulations, title 28, section
				  1300.65(a)(8), an
				  APTC enrollee shall have paid at least one full month's premium before the
				  nonpayment of premiums.
(B) The
				  federal grace period begins the first day after the last day of paid coverage
				  and lasts for three full consecutive months.
(C) Notwithstanding California Code of
				  Regulations, title 28, section
				  1300.65(a)(14), a
				  QHP Issuer may implement a premium payment threshold policy, as defined in
				  California Code of Regulations, title 28, section
				  1300.65(a)(21).
(D) Upon determining that an APTC enrollee
				  has failed to make a premium payment by the due date, the QHP Issuer shall send
				  a "Notice of Start of Federal Grace Period" to the APTC enrollee, notifying the
				  recipient that a payment delinquency has triggered a 3-month federal grace
				  period starting from the first day after the last day of paid
				  coverage.
(E) The Notice of Start
				  of Federal Grace Period sent to the APTC enrollee shall not be mailed or dated
				  on or before the premium due date for which the APTC enrollee is receiving the
				  Notice. The Notice of Start of Federal Grace Period must be sent on or before
				  the fifth (5th) business day after the start of the federal grace period.
				  However, in the event a QHP Issuer learns of a payment delinquency between the
				  last day of paid coverage and the fifteenth (15th) day of the first month of
				  the federal grace period, due to the discovery of insufficient funds, a
				  rejected credit card payment, or a similar event, the QHP Issuer shall send the
				  Notice of Start of Federal Grace Period within five (5) calendar days of
				  learning of the payment delinquency. A Suspension QHP Issuer that fails to send
				  the Notice of Start of Federal Grace Period by the applicable deadline(s) shall
				  not suspend the APTC enrollee's coverage during the second and third months of
				  the federal grace period.
(3) Suspension of Coverage
(A) Suspension of coverage during months two
				  and three of the federal grace period is optional for the plan.
(B) A Non-Suspension QHP Issuer shall not
				  take or threaten action that causes or suggests that the APTC enrollee's
				  coverage may be suspended. A Non-Suspension QHP Issuer shall:
(i) Provide its APTC enrollees with the
				  3-month federal grace period,
(ii)
				  Provide coverage to the APTC enrollee as required by the plan contract during
				  the 3-month federal grace period,
(iii) Pay all claims for covered health care
				  services rendered during the 3-month federal grace period, notwithstanding
				  California Code of Regulations, title 28, section
				  1300.65.3(a)(5)(A),
				  and
(iv) Not hold an APTC enrollee
				  financially responsible for the costs of claims for covered health care
				  services rendered during the 3-month federal grace period, even if cancellation
				  occurs for nonpayment of premium. An APTC enrollee remains responsible for
				  payment of outstanding premiums and any applicable deductibles, copayments, and
				  coinsurance, pursuant to the APTC enrollee's Evidence of Coverage, accrued
				  during the 3-month federal grace period, even if cancellation occurs for
				  nonpayment of premium.
(C) To suspend an enrollee during months two
				  and three of the federal grace period, a Suspension QHP Issuer shall:
(i) Comply with any and all notice
				  requirements to the enrollee related to suspension of coverage;
(ii) Make any necessary system adjustments by
				  day 1 of the second month of the federal grace period to the QHP Issuer's real
				  time eligibility and verification system to accurately reflect the APTC
				  enrollee's suspension of coverage; and
(iii) Reinstate the APTC enrollee,
				  retroactive to the last day of the first month, if the APTC enrollee pays all
				  outstanding premium amounts before the end of the federal grace
				  period.
(D) During the
				  first month of the federal grace period, the Suspension QHP Issuer shall:
(i) Provide coverage to the APTC enrollee as
				  required by the plan contract; and
(ii) If the APTC enrollee does not pay
				  outstanding premium amounts by day 15 of the first month of the federal grace
				  period, the Suspension QHP Issuer shall send a Notice of Suspension to the APTC
				  enrollee, and shall send a separate Notice of Suspension to providers. Both
				  notices shall be sent no earlier than day 16 of the first month of the federal
				  grace period but no later than the end of the first month of the federal grace
				  period.
(E) During months
				  two and three of the federal grace period, the Suspension QHP Issuer shall:
(i) Suspend or pend claims for services
				  rendered to the APTC enrollee; and
(ii) Make any necessary system adjustments by
				  day 1 of the second month of the federal grace period to the Suspension QHP
				  Issuer's real time eligibility and verification system to accurately reflect
				  the APTC enrollee's suspension of coverage. For the purposes of this
				  subdivision, the QHP Issuer shall use only the terms "coverage pending,"
				  "coverage suspended," or "inactive pending investigation" so as to clearly
				  communicate the status of the APTC enrollee.
(F) During the suspension of coverage, the
				  APTC enrollee:
(i) Remains responsible for
				  making all delinquent and ongoing premium payments; and
(ii) May submit a grievance pursuant to
				  Health and Safety Code section
				  1365(b).
(G) The Notice of Suspension shall be given
				  to the APTC enrollee's assigned group, assigned network provider, any provider
				  with an outstanding prior authorization to provide services to the APTC
				  enrollee, and any network provider that submitted claims for the APTC enrollee
				  in the two months prior to the start of the APTC enrollee's federal grace
				  period.
(i) This notice requirement is in
				  addition to the provider's ability to verify APTC enrollee eligibility for
				  coverage with the QHP Issuer.
(ii)
				  This notice requirement does not replace a provider's responsibility to verify
				  eligibility for coverage of an APTC enrollee with the QHP Issuer before
				  providing health care services.
(iii) In the event the Suspension QHP Issuer
				  does not provide the notice to the APTC enrollee's providers or does not update
				  its real time eligibility and verification system by day 1 of the second month
				  of the federal grace period, and providers provide health care services to the
				  APTC enrollee, the Suspension QHP Issuer shall be responsible for paying the
				  claim costs of the APTC enrollee that would have been covered under the plan
				  contract notwithstanding the Suspension of
				  Coverage.
(4)
				  Reinstatement of Coverage
(A) In the event
				  that an APTC enrollee does not pay all outstanding premium amounts before the
				  next premium due date, the QHP Issuer shall bill the APTC enrollee in the same
				  form and manner of billing as if the APTC enrollee were not in the federal
				  grace period, and include in the billing statement the total premium amounts
				  owing at the end of the billing cycle.
(B) Upon payment of all outstanding premium
				  amounts at any time before the expiration of the federal grace period, the QHP
				  Issuer shall reinstate the APTC enrollee's coverage pursuant to the plan
				  contract and immediately update its real time eligibility and verification
				  system to reflect an "active" status.
(C) If an APTC enrollee with coverage through
				  a Suspension QHP Issuer pays all outstanding premium amounts before the end of
				  the federal grace period, the Suspension QHP Issuer shall be liable for the
				  claims covered under the APTC enrollee's Evidence of Coverage less any
				  applicable deductibles, copayments, or coinsurance, from the date of suspension
				  of coverage through the date of reinstatement. The Suspension QHP Issuer shall
				  reimburse the APTC enrollee for any medical expenses incurred pursuant to this
				  subdivision within 30 days of receipt of the complete claim, as defined in
				  California Code of Regulations, title 28, section
				  1300.71(a)(2).
(5) Cancellation or Nonrenewal Following
				  Federal Grace Period
If the APTC enrollee fails to pay outstanding premium
					 amounts on or before the last day of the federal grace period, the QHP Issuer
					 shall cancel or not renew the APTC enrollee's health care coverage.
(A) The effective date of cancellation for an
				  APTC enrollee canceled or not renewed by a Suspension QHP Issuer or by a
				  Non-Suspension QHP Issuer shall be the day after the last day of the first
				  month of the 3-month federal grace period pursuant to 45 Code of Federal
				  Regulations part 155.430(d)(4).
(B)
				  For the purposes of this section, all plans shall notify an enrollee,
				  subscriber, or group contract holder when the plan has cancelled, rescinded, or
				  not renewed health coverage in one of the following two ways:
(i) Send a written notice of termination to
				  the enrollee, subscriber, or group contract holder, when required pursuant to
				  California Code of Regulations, title 10, section
				  6506(e)(1). This
				  notice shall include the notice of grievance rights set forth in California
				  Code of Regulations, title 28, section
				  1300.65.5, and any notice required
				  under Health and Safety Code section
				  1366.50,
				  or
(ii) Send the Notice of End of
				  Coverage. This Notice shall be sent after the date coverage ends, and no later
				  than five calendar days after the date coverage ended. At a minimum, this
				  Notice shall contain the information set forth in California Code of
				  Regulations, title 28, section
				  1300.65.3(b)(4).