DAR File No. 32640

Insurance, Administration

R590-247

Universal Individual Health Insurance Application Rule

NOTICE OF PROPOSED RULE

DAR File No.: 32640
Filed: 04/30/2009, 05:51
Received by: NL

RULE ANALYSIS

Purpose of the rule or reason for the change:

This rule is being changed as a result of the enactment of H.B. 133 during the 2008 Session. The bill requires insurers to use a uniform health insurance application beginning July 1, 2009. It also incorporates requirements from H.B. 178 which requires producer compensation disclosure. (DAR NOTE: H.B. 133 (2008) is found at Chapter 383, Laws of Utah 2008, and was effective 05/05/2008. H.B. 178 (2009) is found at Chapter 274, Laws of Utah 2009, and was effective 03/25/2009.)

Summary of the rule or change:

The scope of the rule has been expanded to include both a small employer group application and an individual application. The use of the applications is now mandatory rather than voluntary effective July 1, 2009. The rule allows for the applications to be revised in certain circumstances. The individual application has a producer compensation disclosure section as required by Subsection 31A-23a-501(4).

State statutory or constitutional authorization for this rule:

Sections 31A-22-635 and 31A-30-102

Anticipated cost or savings to:

the state budget:

Health insurers will be required to file the universal applications with the department, however, this can be handled with existing personnel through the normal course of business.

local governments:

This rule deals with the relationship between the department and its health insurance licensees. It will not affect local governments.

small businesses and persons other than businesses:

Small business, like insurance agencies, will not be affected financially by the changes to this rule, only insurers, which are large employers.

Compliance costs for affected persons:

Insurers will have to discard and discontinue their old insurance application forms for the new ones and file the new forms with the department. Insurers have been aware since last year, of this pending change. Insurance applicants will now only have to complete one application to shop multiple insurance companies.

Comments by the department head on the fiscal impact the rule may have on businesses:

There will be minor expense for the disposal of old forms and reprinting of new ones. D. Kent Michie, Commissioner

The full text of this rule may be inspected, during regular business hours, at the Division of Administrative Rules, or at:

Insurance
Administration
Room 3110 STATE OFFICE BLDG
450 N MAIN ST
SALT LAKE CITY UT 84114-1201

Direct questions regarding this rule to:

Jilene Whitby at the above address, by phone at 801-538-3803, by FAX at 801-538-3829, or by Internet E-mail at [email protected]

Interested persons may present their views on this rule by submitting written comments to the address above no later than 5:00 p.m. on:

06/15/2009

Interested persons may attend a public hearing regarding this rule:

6/01/2009 at 9:00 AM, State Office Building (behind the Capitol), 450 N State St, Room 3112, Salt Lake City, UT

This rule may become effective on:

06/22/2009

Authorized by:

Jilene Whitby, Information Specialist

R590. Insurance, Administration.

R590-247. Universal [Individual ]Health Insurance Application Rule.

R590-247-1. Authority.

This rule is promulgated pursuant to [Subsection]Subsections 31A-22-635 and 31A-30-102 which direct[directs] the commissioner[Insurance Department] to create a universal [individual ]health insurance application.

 

R590-247-2. Purpose and Scope.

(1) The purpose of this rule is to establish [a ]universal applications[individual application] for all insurers offering a health benefit plan[accident and health insurance insurers doing business] in Utah.

(2) This rule applies to all insurers offering an individual or small employer health benefit plan[accident and health insurers doing business] in Utah.

 

R590-247-3. General Instructions.

(1) Use of the Utah [Universal ]Individual Health Insurance Application and the Utah Small Employer Health Insurance Application by insurers or by health insurance producers is mandatory[voluntary].

(2) The Utah [Universal ]Individual Health Insurance Application and Utah Small Employer Health Insurance Application must[will] be used without insurer identifying logos or addresses to facilitate multiple insurer submissions using a single application.

(3) The Utah [Universal ]Individual Health Insurance Application and Utah Small Employer Health Insurance Application can be downloaded from the Department's website at [(]www.insurance.utah.gov[)].

(4) The Utah [Universal ]Individual Health Insurance Application and Utah Small Employer Health Insurance Application may [not ]be altered for:

(a) purposes of electronic application and submission, including electronic signature disclaimers;

(b) languages other than English; and

(c) reasons specifically approved by the commissioner.

(5) The use of the Utah Individual Health Insurance Application and the Utah Small Employer Health Insurance Application does not limit the ability of an insurer to obtain additional information for underwriting purposes.

(6) Section L, Producer Agreement and Compensation Disclosure section on the Utah Individual Health Insurance Application must include all information to be disclosed as required by Section 31A-23a-501.

(7)(a) Except as provided in R590-247-3(7)(b), question number 40 on the Utah Individual Health Insurance Application and Utah Small Employer Health Insurance Application may not be used for purposes of Sections 31A-8-402.3, 31A-8-402.5, 31A-21-105, 31A-22-721, 31A-30-107, 31A-30-107.1, or R590-247-3(5), unless the information was disclosed or should have been disclosed in another question on the application.

(8)(a) Starting July 1, 2009, insurers shall accept the Utah Individual Health Insurance Application and Utah Small Employer Health Insurance Application.

(b) An insurer may accept an application other than the Utah Individual Health Insurance Application and Utah Small Employer Health Insurance Application until December 31, 2009.

(9) No later than July 1, 2010, all insurers shall offer compatible systems for electronic submission of the Utah Individual Health Insurance Application and the Utah Small Employer Health Insurance Application.

 

R590-247-4. Penalties.

A person found[, after a hearing or other regulatory process,] to be in violation of this rule shall be subject to penalties as provided under 31A-2-308.

 

R590[R547]-247-5. Enforcement Date.

The commissioner will begin enforcing this rule 45 days from the rule's effective date.

 

R590-247-[5]6. Severability.

If any provision of this rule or its application to any person or situation[circumstance] is[, for any reason,] held to be invalid, that invalidity shall not affect any other provision or application of this rule which can be given effect without the invalid provision or application, and to this end the provisions of this rule are declared to be severable.[the remainder of this rule and its application to other persons and circumstances are not affected.]

 

KEY: universal [individual ]health insurance application

Date of Enactment or Last Substantive Amendment: [June 30, 2008]2009

Authorizing, and Implemented or Interpreted Law: [31A-2-308; ]31A-30-102