§ 27-8-31-8 — Rules; uniform standards; opting out; judicial review

(a) The commission shall adopt reasonable
rules, including uniform standards, and operating procedures in order
to effectively and efficiently achieve the purposes of this compact.
However, if the commission exercises the commission's rulemaking
authority in a manner that is beyond the scope of the purposes of this
chapter or the powers granted in this chapter, the action by the
commission is invalid and has no force and effect.
(b) Rules and operating procedures shall be made according to a
rulemaking process that substantially conforms to the principles of the
model state administrative procedure act of 1981, as amended, as may
be appropriate to the operations of the commission. Before the
commission adopts a uniform standard, the commission shall give
written notice to the relevant state legislative committees in each
compacting state responsible for insurance issues of the commission's
intention to adopt the uniform standard. The commission, in adopting
a uniform standard, shall fully consider all submitted materials and
issue a concise explanation of the commission's decision.
(c) A uniform standard becomes effective ninety (90) days after the
uniform standard's adoption by the commission or on a later date as the
commission may determine. However, a compacting state may opt out
of a uniform standard as provided in subsection (d). All other rules and
operating procedures and amendments to the other rules and operating
procedures become effective as of the date specified in each rule,
operating procedure, or amendment.
(d) A compacting state may opt out of a uniform standard, either by
legislation or by rule adopted by the insurance department under the
compacting state's administrative procedure act. If a compacting state
elects to opt out of a uniform standard by rule, the compacting state
must:
(1) give written notice to the commission not later than ten (10)
business days after the uniform standard is adopted or at the time
the state becomes a compacting state; and
(2) find that the uniform standard does not provide reasonable
protections to the citizens of the state, given the conditions in the
state. The commissioner shall make specific findings of fact and
conclusions of law, based on a preponderance of the evidence,
detailing the conditions in the state that warrant a departure from
the uniform standard and determining that the uniform standard
would not reasonably protect the citizens of the state. The
commissioner must balance, consider, and find that the conditions
in the state and needs of the citizens of the state outweigh the
following factors:
(A) The intent of the legislature to participate in, and the
benefits of, an interstate agreement to establish national
uniform consumer protections for the products subject to this
chapter.
(B) The presumption that a uniform standard adopted by the
commission provides reasonable protections to consumers of
the relevant product.
However, a compacting state may, at the time of the compacting state's
enactment of this compact, prospectively opt out of all uniform
standards involving long term care insurance products by expressly
providing for an opt out in the enacted compact, and the opt out shall
not be treated as a material variance in the offer or acceptance of any
state to participate in this compact. The opt out is effective at the time
of enactment of this compact by the compacting state and shall apply
to all existing uniform standards involving long term care insurance
products and those subsequently adopted.
(e) If a compacting state elects to opt out of a uniform standard, the
uniform standard remains applicable in the compacting state electing
to opt out until the time the opt out legislation is enacted or the
regulation opting out becomes effective. Once the opt out of a uniform
standard by a compacting state becomes effective as provided under the
laws of the state, the uniform standard shall have no further force and
effect in the state unless and until the legislation or regulation
implementing the opt out is repealed or otherwise becomes ineffective
under the laws of the state. If a compacting state opts out of a uniform
standard after the uniform standard has been made effective in the
state, the opt out shall have the same prospective effect as provided
under section 15 of this chapter for withdrawals.
(f) If a compacting state has formally initiated the process of opting
out of a uniform standard by rule while the regulatory opt out is
pending, the compacting state may petition the commission, not less
than fifteen (15) days before the effective date of the uniform standard,
to stay the effectiveness of the uniform standard in the compacting
state. The commission may grant a stay if the commission determines
the regulatory opt out is being pursued in a reasonable manner and
there is a likelihood of success. If a stay is granted or extended by the
commission, the stay or extension may postpone the effective date by
not more than ninety (90) days, unless the stay is extended by the
commission. However, a stay may not be permitted to remain in effect
for more than one (1) year unless the compacting state can show
extraordinary circumstances that warrant a continuance of the stay,
including the existence of a legal challenge that prevents the
compacting state from opting out. A stay may be terminated by the
commission on notice that the rulemaking process has been terminated.
(g) Not later than thirty (30) days after a rule or operating procedure
is adopted, any person may file a petition for judicial review of the rule
or operating procedure. However, the filing of a petition shall not stay
or otherwise prevent the rule or operating procedure from becoming
effective unless the court finds that the petitioner has a substantial
likelihood of success. The court shall give deference to the actions of
the commission consistent with applicable law and shall not find the
rule or operating procedure to be unlawful if the rule or operating
procedure represents a reasonable exercise of the commission's
authority.

Legislative History

As added by P.L.138-2005, SEC.3.