DAR File No. 38857
This rule was published in the October 1, 2014, issue (Vol. 2014, No. 19) of the Utah State Bulletin.
Insurance, Administration
Rule R590-176
Health Benefit Plan Enrollment
Notice of Proposed Rule
(Amendment)
DAR File No.: 38857
Filed: 09/11/2014 11:09:04 AM
RULE ANALYSIS
Purpose of the rule or reason for the change:
The changes to this rule are being made to comply with the Affordable Care Act (ACA), PHSA 2702, guaranteed Availability of Coverage, and PHSA 2705, Prohibited Discrimination Against Individual Participants Beneficiaries Based on Health Status.
Summary of the rule or change:
Changes to this rule are being made because the federal government now requires all individual and small group health benefit plans to guarantee coverage to all enrollees with no enrollment caps and have no underwriting criteria that must be met by enrollees before being covered. The definition of "Carrier" is being eliminated since it is already defined in Title 31A. These changes reflect changes already implemented by health insurers marketing health benefit plans.
State statutory or constitutional authorization for this rule:
- Subsection 31A-2-202(2)
- Subsection 31A-2-201(3)
Anticipated cost or savings to:
the state budget:
The changes to this rule will have no fiscal impact on the department or state budgets. There are no filing requirements that will increase revenues nor a change in the workload that will result in a change in department personnel.
local governments:
The changes to this rule will have no impact on local governments. The changes deal solely with the relationship between the department and their health insurance licensees.
small businesses:
Rule language is being removed because the ACA law provides consumer protections in applying for health coverage.
persons other than small businesses, businesses, or local governmental entities:
Rule language is being removed because the ACA law provides consumer protections in applying for health coverage.
Compliance costs for affected persons:
Insurers providing health benefit plans in Utah have been required to provide individual and small groups with health benefit plans that guaranteed coverage to all enrollees with no enrollment caps and no underwriting criteria to be met by enrollees before being covered. These coverage requirements are now being extended by the federal government. As far as Utah is concerned, the transfer of these requirements from state law to federal will create no fiscal impact on insurers, small businesses, or individuals.
Comments by the department head on the fiscal impact the rule may have on businesses:
The changes being made to this rule should have no fiscal impact on businesses. The federal government has just carried on with the same requirements that were already in our law.
Todd E. Kiser, Commissioner
The full text of this rule may be inspected, during regular business hours, at the Division of Administrative Rules, or at:
InsuranceAdministration
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 jwhitby@utah.gov
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:
10/31/2014
This rule may become effective on:
11/07/2014
Authorized by:
Todd Kiser, Commissioner
RULE TEXT
R590. Insurance, Administration.
R590-176. Health Benefit Plan Enrollment.
R590-176-1. Authority.
The commissioner's authority to promulgate this rule is provided in Sections 31A-2-201(3) and 31A-2-202(2).
R590-176-2. Purpose and Scope.
The purpose and scope of this rule is to provide enrollment requirements under Section 31A-30-108 for carriers who provide health benefit plan coverage to individuals and small employers as stated in Section 31A-30-104.
R590-176-3. Definitions.
(1) The definitions in Sections 31A-1-301 and 31A-30-103 apply to this rule.
(2) ["Carrier" means a covered carrier as defined in
Section 31A-30-103.
(3)] "Time period" means the period such
as daily, weekly or monthly, as determined by the carrier, in which
applications are grouped.
R590-176-4. General Provisions.
(1) Any attempt to selectively or unfairly delay, obstruct or otherwise hinder any person from obtaining coverage under Chapter 30 is a violation of Section 31A-30-108.
(2) Enrollment shall be equally available
through all distribution systems[, classes of business, and rating criteria
categorizations].
(3) [Enrollment is available to small employers without respect
to whether any eligible employee or dependent is classified as
uninsurable.
(4) The enrollment residency requirements do not
supersede other dependent and child requirements of the Insurance
Code.
(5) When requested, a carrier must offer a Utah NetCare
Plan in compliance with Section 31A-30-109.
(6)] A carrier may not market or encourage
producers to market individual or small employer health benefit
plans in such a way that there is a lessened incentive to insure
business with greater health risks.
[(7) Commission schedules shall be structured in compliance
with R590-207, Health Agent Commissions for Small Employer
Groups.
(8) The carrier shall retain a signed statement from each
covered small employer that the carrier offered to accept all
eligible employees and their dependents at the same level of
benefits under the health benefit plan provided to the
employer.
(9) An individual or small employer is considered
uninsured if the individual or small employer:
(a) does not have a health benefit plan; or
(b) health benefit plan is with a carrier that has made
an election under Subsections 31A-8-402.3(3)(e),
31A-8-402.5(3)(e), 31A-22-721(3)(e), 31A-30-107(3)(e), or
31A-30-107.1(3)(e).
][(10)](4) All records regarding enrollment applications and
underwriting determinations shall:
(a) be retrievable for examination by the time period the application was received;
(b) include all documents, indicating the applicable date, pertaining to the application and its underwriting; and
(c) be retained for the current year plus three years.
[(11)](5) The documents indicated in Subsection [(10)(b)](4)(b) would include:
(a) application and date received,
(b) notifications to the applicant and the date of notification;
(c) records used in underwriting and date received; and
(d) underwriting decision and date of decision.
R590-176-5. Application and Enrollment.
(1) [An individual]Each carrier shall establish a procedure to determine the
order of applications. The procedure shall group the applications
into consistent time periods. [The enrollment cap may not be applied until the end of the
time period in which it is met. ]The [individual ]carrier shall keep a record of all
applications for coverage that includes the time period an
application is received by the carrier.
(2) All applications shall be treated consistently.
(3)(a) A complete application shall be
processed and a written notice of the decision communicated to the
applicant within 30 days of the decision.[ If an application is denied, the decision must include
specific details explaining the denial.]
(b) The carrier may not require that an application be complete in order to qualify as an application for coverage.
(c) If an application is incomplete,
within 15 days from receipt of the application[,] a carrier shall notify the applicant of the
areas that are incomplete and the information required to complete
the application.
(d) Before an application can be [filed]rejected as incomplete, applicants shall have at least 30
days[,] after being notified additional information is
required to provide the information.
[(e) A date earlier than the postmarked date of the notice
in Subsection (3)(c), may not be used as the date of
notification.
(4) The acceptance of an application may not be delayed
pending the receipt of medical records. This does not apply to
other required statements from applicants as provided in
Subsection (3).
]
R590-176-6. [Small Employer Enrollment.
A small employer carrier shall:
(1) permit an eligible employee, or a dependent of such
employee, to enroll for coverage under the terms of the plan, if
the eligible employee requests enrollment not later than 30 days
after the eligibility date; and
(2) enroll a new eligible employee and a dependent of
such employee making timely application for coverage in a small
employer group with existing coverage.
R590-176-7. Individual Underwriting Criteria.
(1) Each carrier shall determine the number of
individuals classified as uninsurable at initial enrollment. This
determination shall be made in accordance with this
rule.
(2) An individual insured by the Utah Comprehensive
Health Insurance Pool is classified as uninsurable.
(3) (a) An individual may be classified as uninsurable if
the individual has:
(i) one or more medical conditions; or
(ii) one or more prescriptions; and
(iii) the conditions, prescriptions, or both, are
determined to have a total number of debit points equal to or
greater than 99 debit points in the aggregate consistent with the
Milliman Health Cost Guidelines - Small Group Medical
Underwriting, June 2008, taking into account;
(A) elapsed time;
(B) additional criteria; and
(C) exception criteria.
(b) A carrier may not take into account conditions for
which coverage is not provided. This includes conditions excluded
as a pre-existing condition for which treatment is expected
during the exclusion period if the applicant would not be
considered uninsurable after the treatment.
(4) Determinations made by a carrier under Subsection
(3)(iii) will be audited by an experienced independent
underwriter retained by the board of the Utah Comprehensive
Health Insurance Pool who will rely on the Milliman Health Cost
Guidelines - Small Group Medical Underwriting, June 2008, to
evaluate whether the debit points of the medical conditions,
prescriptions, or both are equal to or greater than 99 debit
points in the aggregate.
(5) A carrier may appeal a determination by the auditor
under Section (4) that an individual has a combination of
conditions, prescriptions, or both, that cause that individual to
have debit points less than the number of debit points determined
under Section (3) to the commissioner. The commissioner may
appoint a designee to review these appeals.
(6) Only individuals enrolling under Subsection
31A-30-108(3) may be counted as uninsurable.
R590-176-8. Individual Carrier Enrollment Cap Calculation
and Certification.
(1) Pursuant to Section 31A-30-110, an individual carrier
may not decline enrollment until the carrier has:
(a) met its enrollment cap; and
(b) submitted a certification to the department in
compliance with this section.
(2) An individual carrier may limit enrollment after
submitting its certification.
(3) The commissioner may require additional enrollment
after reviewing the certification.
(4) An officer of the individual carrier shall submit a
certification that:
(a) lists the UC and CI as defined in Section
31A-30-103(28);
(b) lists the number of individual natural covered lives
at the time of the certification;
(c) categorizes the UC into new applicants added to
existing policies and newly issued policies;
(d) identifies the number of Comprehensive Health
Insurance Pool participants; and
(e) identifies the qualifying conditions, prescriptions,
or both that cause the persons making up the carrier's UC to
be considered uninsurable under Section 31A-30-106(1) and Rule
R590-176.
(5) Carriers, whose coverage count exceeds 200% of the
coverage count as of the end of the prior year, shall determine
the uninsurable percentage using counts as of the end of the most
recent calendar quarter.
R590-176-9. Solvency Waiver.
A carrier that expects the requirements of Chapter 30 to
place the carrier in supervision, insolvency or liquidation
shall, within 15 days of such determination, submit a report to
the commissioner. The report shall detail the financial
consequences of Chapter 30 and request the specific waivers or
modifications required to prevent supervision, insolvency or
liquidation.
R590-176-10. Enforcement Date.
The commissioner will begin enforcing the revised
provisions of this rule 45 days from the rule's effective
date.
R590-176-11.
]Severability.
If any provision or clause of this rule or its application to any person or situation is held invalid, such 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.
KEY: health insurance
Date of Enactment or Last Substantive Amendment: [October 3, 2012]2014
Notice of Continuation: December 19, 2011
Authorizing, and Implemented or Interpreted Law: 31A-2-201; 31A-2-202
Additional Information
More information about a Notice of Proposed Rule is available online.
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For questions regarding the content or application of this rule, please contact Jilene Whitby at the above address, by phone at 801-538-3803, by FAX at 801-538-3829, or by Internet E-mail at jwhitby@utah.gov. For questions about the rulemaking process, please contact the Division of Administrative Rules.