§ 10-16-106 — Group replacement - extension of benefits

(1) This section shall
indicate which carrier is liable where one carrier's group contract replaces a plan of
similar benefits of another carrier within thirty-one days after the termination,
cancellation, or expiration of the contract that is being replaced.

(2) The prior carrier remains liable only to the extent of its accrued liabilities,
extensions of benefits as specified in the policy contract, and benefits for covered
persons until release from an in-patient facility as required by section 10-16-705 (4).
The position of the prior carrier shall be the same whether the group policyholder or
other entity secures replacement coverage from a new carrier, self-insures, or
foregoes coverage.

(3) Liability of a succeeding carrier is as follows:

(a) Each person who is eligible for coverage in accordance with the
succeeding carrier's plan of benefits, with respect to classes eligible and actively at
work and nonconfinement rules, if allowable, shall be covered by the succeeding
carrier's plan of benefits except with respect to accrued liabilities and extensions
of benefits provided for in subsection (2) of this section.

(b) Each person who is not eligible under the succeeding carrier's plan of
benefits in accordance with paragraph (a) of this subsection (3) shall be covered by
the succeeding carrier in accordance with the following guidelines if such individual
was validly covered, including benefit extension, under the prior plan on the date of
discontinuance. Such guidelines are as follows:

(I) The minimum level of benefits to be provided by the succeeding carrier
shall be the applicable level of benefits of the prior carrier's plan reduced by any
benefits payable by the prior plan.

(II) Coverage shall be provided by the succeeding carrier until at least the
earliest of the following dates:

(A) The date the individual becomes eligible under the succeeding carrier's
plan as described in paragraph (a) of this subsection (3);

(B) The date the individual's coverage would terminate in accordance with
the succeeding carrier's plan provisions applicable to individual termination of
coverage, where employment is terminated or where the individual ceases to be an
eligible dependent.

(C) (Deleted by amendment, L. 99, p. 196, � 2, effective January 1, 2000.)

(III) Nothing in this paragraph (b) shall be construed to limit the duration of
continuation coverage provided for in section 10-16-108.

(c) (Deleted by amendment, L. 99, p. 196, � 2, effective January 1, 2000.)

(d) Each person previously covered by a policy which included deductibles or
waiting periods shall be given credit for the satisfaction or partial satisfaction of
the same or similar provisions in the succeeding policy where it provides similar
benefits. In the case of deductible provisions, the credit shall apply for the same or
overlapping benefit periods and shall be given for expenses actually incurred and
applied against the deductible provisions of the prior carrier's plan during the
ninety days preceding the effective date of the succeeding carrier's plan but only to
the extent these expenses are recognized under the terms of the succeeding
carrier's plan and are subject to a similar deductible provision.

(e) Where a determination of the extent of the prior carrier's benefits is
required, the prior carrier shall furnish a statement of such benefits or other
pertinent information sufficient to permit verification of the benefit determination
or sufficient to allow the succeeding carrier to make the determination. For the
purposes of this paragraph (e), benefits of the prior plan will be determined in
accordance with all of the definitions, conditions, and covered expense provisions
of the prior plan rather than those of the succeeding plan. The benefit
determination will be made as if coverage had not been replaced by the succeeding
carrier.

Legislative History

Source: L. 92: Entire article R&RE, p. 1637, � 1, effective July 1. L. 99: (1), (2), (3)(a), (3)(b), and (3)(c) amended, p. 196, � 2, effective January 1, 2000.