§ 24-A §2849-B — Continuity for individual who changes groups

1.
Policies subject to this section.
This section applies to all individual, group and blanket medical insurance policies except hospital indemnity, specified accident, specified disease, long-term care and short-term, limited-duration policies issued by insurers or health maintenance organizations. For purposes of this section, a short-term, limited-duration policy is an individual, nonrenewable policy issued for a term that does not extend beyond December 31st of the calendar year in which the policy is issued. This section does not apply to Medicare supplement policies as defined in section 5001, subsection 4.
2.
Persons provided continuity of coverage.
Except as provided in subsection 3, this section provides continuity of coverage for a person who seeks coverage under an individual, group or blanket insurance policy or health maintenance organization policy if:
3.
Exception for late enrollees.
Notwithstanding subsection 2, this section does not provide continuity of coverage for a late enrollee except as provided in this subsection. A late enrollee may be excluded from coverage for a waiting period of not more than 12 months based on medical underwriting or preexisting conditions. If a shorter waiting period or no waiting period is imposed, coverage for the late enrollee may exclude preexisting conditions for the lesser of 18 months, reduced by any federally creditable coverage, or 12 months. The exclusion is subject to the limitations set forth in section 2850. For purposes of this section, a "late enrollee" is a person who requests enrollment in a group plan following the initial enrollment period provided under the terms of the plan, except that a person is not a late enrollee if:
3-A.
Prohibition against discontinuity in group policies.
Except as provided in this section, in a group policy subject to this section, the insurer or health maintenance organization shall, for any person described in subsection 2, waive any medical underwriting or preexisting conditions exclusion. The succeeding policy is not required to duplicate any benefits covered by the prior contract or policy.
3-B.
Persons subject to a preexisting condition exclusion.
4.
Prohibition against discontinuity in individual and blanket policies.
Except as provided in this section, in an individual or blanket policy subject to this section, the insurer or health maintenance organization must, for any person described in subsection 2, waive any medical underwriting or preexisting conditions exclusion to the extent that benefits would have been payable under a prior contract or policy if the prior contract or policy were still in effect or to the extent that benefits would have been payable under the prior contract or policy if not for the operation of a lifetime limit on all benefits. The succeeding policy is not required to duplicate any benefits covered by the prior contract or policy.
4-A.
Alternative method.
The superintendent may adopt rules that substitute for the requirement of subsection 3‑A a requirement that prohibits application of a medical underwriting or preexisting condition exclusion with respect to classes or categories of benefits that are covered under the replaced contract or policy. The rules must define those classes or categories consistent with any federal regulations adopted pursuant to the federal Public Health Service Act, Title XXVII, Section 2701(c)(3)(B).
5.
Determination of benefits.
When a determination of benefit under the prior contract or policy is required, the issuer of the prior contract or policy shall, at the request of the issuer of the succeeding policy, furnish a statement of benefits available or pertinent information sufficient to permit verification of the benefit determination or the determination itself by the issuer of the succeeding policy. For purposes of this section, benefits of the prior contract or policy are determined in accordance with the definitions, conditions and covered expense provisions of that contract or policy rather than those of the succeeding policy. The benefit determination must be made as if coverage had not been replaced.
6.
Limit on premium increase.
For rating purposes, an insurer or health maintenance organization may not charge claims for preexisting conditions of any person subject to this section, during the first 12 months of employment of that person, directly to a group of fewer than 100 insured employees except to the extent that the resulting increase in the premium would be 10% or less. The insurer or health maintenance organization may pool any additional claims among all such groups and subgroups covered by that insurer or health maintenance organization. This requirement also applies to subgroups of fewer than 100 insured employees if the subgroup is treated as a separate unit for rating purposes.
7.
Reinsurance, excess insurance or administrative services.
An insurer may only offer, issue or renew reinsurance or excess insurance coverage or offer administrative services to an uninsured employee benefit plan that provides payment for health services received by employees and their dependents when that plan for the payment of health services and reinsurance and excess insurance coverage meets the requirements of continuity of coverage in this chapter.
8.
Short-term, limited-duration insurance.
A person eligible for continuity of coverage under subsection 2 may be allowed to purchase coverage under an individual, nonrenewable, short-term, limited‑duration policy. The issuance of a short-term, limited‑duration policy is subject to the following conditions.

Legislative History

PL 1989, c. 867, §§8,10 (NEW). PL 1991, c. 695, §§9,10 (AMD). PL 1993, c. 477, §§A8-14 (AMD). PL 1993, c. 477, §F1 (AFF). PL 1993, c. 666, §D4 (AMD). PL 1995, c. 77, §2 (AMD). PL 1995, c. 332, §§F4,5 (AMD). PL 1995, c. 342, §§6-8 (AMD). PL 1995, c. 625, §B10 (AMD). PL 1995, c. 673, §B3 (AMD). PL 1997, c. 370, §C4 (AMD). PL 1997, c. 445, §§25-27 (AMD). PL 1997, c. 445, §32 (AFF). PL 1997, c. 777, §§B5,6 (AMD). PL 1999, c. 36, §§1-3 (AMD). PL 1999, c. 256, §L7 (AMD). PL 2001, c. 258, §§E7,8 (AMD). PL 2005, c. 683, §A42 (AMD). PL 2007, c. 199, Pt. A, §§4, 5 (AMD). PL 2007, c. 199, Pt. D, §4 (AMD). PL 2009, c. 244, Pt. E, §§4-6 (AMD). PL 2009, c. 511, Pt. D, §1 (AMD). PL 2011, c. 90, Pt. G, §§1, 2 (AMD). PL 2019, c. 5, Pt. A, §15 (AMD). PL 2019, c. 330, §§2-4 (AMD). PL 2019, c. 330, §6 (AFF). PL 2023, c. 597, §18 (AMD).