Iowa Administrative Code › Agency 191 - Insurance Division › Life and Health Insurance › Chapter 39 - Long-term Care Insurance › Rule 191-39.4 - Definitions

Current through Register Vol. 47, No. 3, July 24, 2024
For the purpose of these rules, the terms
"Group
				  long-term care insurance," "Commissioner," "Applicant," "Policy," "Preexisting
				  condition"
and
"Certificate"
shall have the meanings
				  set forth in Iowa Code chapter 514G, "Long-Term Care Insurance Act."
"Long-term care insurance"
means an
				  insurance policy, insurance contract, insurance certificate, or rider, which is
				  advertised, marketed, offered, or designed to provide coverage for not less
				  than 12 consecutive months for each covered person on an expense-incurred,
				  indemnity, prepaid, or other basis; for one or more necessary or medically
				  necessary diagnostic, preventive, therapeutic, rehabilitative, maintenance, or
				  personal care service provided in a setting other than an acute care imit of a
				  hospital. This definition also encompasses group and individual annuities and
				  life insurance policies or riders that provide directly for or supplement
				  long-term care insurance as well as a policy or rider providing for payment of
				  benefits based upon cognitive impairment or the loss of functional
				  capacity.
Long-term care insurance may be issued by insurers, fraternal
				  benefit societies, nonprofit health, hospital, and medical service
				  corporations, prepaid health plans, health maintenance organizations or any
				  similar organizations to the extent they are otherwise authorized to issue life
				  or health insurance.
Long-term care insurance shall not include any insurance
				  policy which is offered primarily to provide basic Medicare Supplement
				  coverage, basic hospital expense coverage, basic medical-surgical expense
				  coverage, disability income or related asset-protection coverage, or
				  accident-only coverage, specific disease or specified accident coverage, or
				  limited benefit health coverage. The definition does not include life insurance
				  policies which accelerate the death benefit specifically for one or more of the
				  qualifying events of terminal illness, medical conditions requiring
				  extraordinary medical intervention, or permanent institutional confinement, and
				  which provide the option of a lump-sum payment for those benefits and in which
				  neither the benefits nor eligibility for those benefits is conditional upon the
				  receipt of long-term care. Notwithstanding any other provision contained
				  herein, any product advertised, marketed, or offered as long-term care
				  insurance shall be subject to the provisions of 191-Chapter 39.
"Long-term care coverage arrangement"
is a
				  promise that long-term care will be delivered to a person upon need and the
				  meeting of certain contractual requirements. The arrangement is offered to the
				  general public or a sector of the general public at a cost determined by the
				  use of sound actuarial principles based upon the probability of use. This
				  definition does not include self-insurance.
"Qualified long-term care insurance
				  contract"
or
"federally tax-qualified long-term care insurance
				  contract"
means an individual or group insurance contract that meets
				  the requirements of Section 7702B(b) of the Internal Revenue Code of 1986, as
				  follows:
1. The only insurance
				protection provided under the contract is coverage of qualified long-term care
				services. A contract shall not fail to satisfy the requirements of this
				paragraph by reason of payments being made on a per diem or other periodic
				basis without regard to the expenses incurred during the period to which the
				payments relate;
2. The contract
				does not pay or reimburse expenses incurred for services or items to the extent
				that the expenses are reimbursable under Title XVIII of the Social Security Act
				or would be so reimbursable but for the application of a deductible or
				coinsurance amount. The requirements of this paragraph do not apply to expenses
				that are reimbursable under Title XVIII of the Social Security Act only as a
				secondary payor A contract shall not fail to satisfy the requirements of this
				paragraph by reason of payments being made on a per diem or other periodic
				basis without regard to the expenses incurred during the period to which the
				payments relate;
3. The contract is
				guaranteed renewable, within the meaning of Section 7702B(b)(1)(C) of the
				Internal Revenue Code of 1986;
4.
				The contract does not provide for a cash surrender value or other money that
				can be paid, assigned, pledged as collateral for a loan, or borrowed;
5. All refunds of premiums, and all
				policyholder dividends or similar amounts, under the contract are to be applied
				as a reduction in future premiums or to increase future benefits, except that a
				refund on the event of death of the insured or a complete surrender or
				cancellation of the contract cannot exceed the aggregate premiums paid under
				the contract; and
6. The contract
				meets the consumer protection provisions set forth in Section 7702B(g) of the
				Internal Revenue Code of 1986.
"Qualified long-term care insurance contract" or "federally
				  tax-qualified long-term care insurance contract" also means the portion of a
				  life insurance contract that provides long-term care insurance coverage by
				  rider or as part of the contract and that satisfies the requirements of
				  Sections 7702B(b) and (e) of the Internal Revenue Code of 1986.