Citations Affected:
IC 27-4-1-4
; IC 27-8.
Synopsis: Health insurance waivers. Conference committee report for ESB 341. Provides that:
(1) an individual policy of accident and sickness insurance; or (2) a group policy of accident and
sickness insurance under which a certificate of coverage is issued through a two year
demonstration project by an insurer to an individual member of a non-employer based
association or discretionary group; that is issued after June 30, 2003, and before July 1, 2005,
may contain a waiver of coverage for a specified condition under certain circumstances.
Specifies that an offer of coverage under a policy that includes a waiver does not preclude
eligibility for a comprehensive health insurance association policy. Requires reporting by
insurers to the department of insurance and requires the department of insurance to perform
interviews of certificate holders, compile information, and report to the legislative council and
general assembly. (This conference committee report: Removes a provision requiring the
law of another state in which an association group or discretionary group policy that covers
an Indiana resident is issued to have a law containing certain Indiana provisions. Requires
the commissioner of the department of insurance to: (1) establish a two year demonstration
project through which three accident and sickness insurers may each issue 1,500
certificates of coverage containing a waiver to a member of an association or a
discretionary group; and (2) perform interviews of certificate holders, compile information,
and report to the legislative council.)
Effective: Upon passage; July 1, 2003.
MR. SPEAKER:
Your Conference Committee appointed to confer with a like committee from the Senate
upon Engrossed House Amendments to Engrossed Senate Bill No. 341 respectfully reports
that said two committees have conferred and agreed as follows to wit:
that the Senate recede from its dissent from all House amendments and that
the Senate now concur in all House amendments to the bill and that the bill
be further amended as follows:
Delete everything after the enacting clause and insert the following:
such policyholder to lapse, forfeit, or surrender his insurance.
(2) Making, publishing, disseminating, circulating, or placing
before the public, or causing, directly or indirectly, to be made,
published, disseminated, circulated, or placed before the public, in
a newspaper, magazine, or other publication, or in the form of a
notice, circular, pamphlet, letter, or poster, or over any radio or
television station, or in any other way, an advertisement,
announcement, or statement containing any assertion,
representation, or statement with respect to any person in the
conduct of his insurance business, which is untrue, deceptive, or
misleading.
(3) Making, publishing, disseminating, or circulating, directly or
indirectly, or aiding, abetting, or encouraging the making,
publishing, disseminating, or circulating of any oral or written
statement or any pamphlet, circular, article, or literature which is
false, or maliciously critical of or derogatory to the financial
condition of an insurer, and which is calculated to injure any
person engaged in the business of insurance.
(4) Entering into any agreement to commit, or individually or by a
concerted action committing any act of boycott, coercion, or
intimidation resulting or tending to result in unreasonable restraint
of, or a monopoly in, the business of insurance.
(5) Filing with any supervisory or other public official, or making,
publishing, disseminating, circulating, or delivering to any person,
or placing before the public, or causing directly or indirectly, to be
made, published, disseminated, circulated, delivered to any person,
or placed before the public, any false statement of financial
condition of an insurer with intent to deceive. Making any false
entry in any book, report, or statement of any insurer with intent to
deceive any agent or examiner lawfully appointed to examine into
its condition or into any of its affairs, or any public official to
which such insurer is required by law to report, or which has
authority by law to examine into its condition or into any of its
affairs, or, with like intent, willfully omitting to make a true entry
of any material fact pertaining to the business of such insurer in
any book, report, or statement of such insurer.
(6) Issuing or delivering or permitting agents, officers, or
employees to issue or deliver, agency company stock or other
capital stock, or benefit certificates or shares in any common law
corporation, or securities or any special or advisory board contracts
or other contracts of any kind promising returns and profits as an
inducement to insurance.
(7) Making or permitting any of the following:
(A) Unfair discrimination between individuals of the same class
and equal expectation of life in the rates or assessments charged
for any contract of life insurance or of life annuity or in the
dividends or other benefits payable thereon, or in any other of
the terms and conditions of such contract; however, in
determining the class, consideration may be given to the nature
of the risk, plan of insurance, the actual or expected expense of
conducting the business, or any other relevant factor.
rebates any of the following practices:
(A) Paying bonuses to policyholders or otherwise abating their
premiums in whole or in part out of surplus accumulated from
nonparticipating insurance, so long as any such bonuses or
abatement of premiums are fair and equitable to policyholders
and for the best interests of the company and its policyholders.
(B) In the case of life insurance policies issued on the industrial
debit plan, making allowance to policyholders who have
continuously for a specified period made premium payments
directly to an office of the insurer in an amount which fairly
represents the saving in collection expense.
(C) Readjustment of the rate of premium for a group insurance
policy based on the loss or expense experience thereunder, at the
end of the first year or of any subsequent year of insurance
thereunder, which may be made retroactive only for such policy
year.
(D) Paying by an insurer or agent thereof duly licensed as such
under the laws of this state of money, commission, or brokerage,
or giving or allowing by an insurer or such licensed agent thereof
anything of value, for or on account of the solicitation or
negotiation of policies or other contracts of any kind or kinds, to
a broker, agent, or solicitor duly licensed under the laws of this
state, but such broker, agent, or solicitor receiving such
consideration shall not pay, give, or allow credit for such
consideration as received in whole or in part, directly or
indirectly, to the insured by way of rebate.
(9) Requiring, as a condition precedent to loaning money upon the
security of a mortgage upon real property, that the owner of the
property to whom the money is to be loaned negotiate any policy
of insurance covering such real property through a particular
insurance agent or broker or brokers. However, this subdivision
shall not prevent the exercise by any lender of its or his right to
approve or disapprove of the insurance company selected by the
borrower to underwrite the insurance.
(10) Entering into any contract, combination in the form of a trust
or otherwise, or conspiracy in restraint of commerce in the
business of insurance.
(11) Monopolizing or attempting to monopolize or combining or
conspiring with any other person or persons to monopolize any part
of commerce in the business of insurance. However, participation
as a member, director, or officer in the activities of any nonprofit
organization of agents or other workers in the insurance business
shall not be interpreted, in itself, to constitute a combination in
restraint of trade or as combining to create a monopoly as provided
in this subdivision and subdivision (10). The enumeration in this
chapter of specific unfair methods of competition and unfair or
deceptive acts and practices in the business of insurance is not
exclusive or restrictive or intended to limit the powers of the
commissioner or department or of any court of review under
section 8 of this chapter.
(12) Requiring as a condition precedent to the sale of real or
personal property under any contract of sale, conditional sales
contract, or other similar instrument or upon the security of a
chattel mortgage, that the buyer of such property negotiate any
policy of insurance covering such property through a particular
insurance company, agent, or broker or brokers. However, this
subdivision shall not prevent the exercise by any seller of such
property or the one making a loan thereon, of his, her, or its right
to approve or disapprove of the insurance company selected by the
buyer to underwrite the insurance.
(13) Issuing, offering, or participating in a plan to issue or offer,
any policy or certificate of insurance of any kind or character as an
inducement to the purchase of any property, real, personal, or
mixed, or services of any kind, where a charge to the insured is not
made for and on account of such policy or certificate of insurance.
However, this subdivision shall not apply to any of the following:
(A) Insurance issued to credit unions or members of credit
unions in connection with the purchase of shares in such credit
unions.
(B) Insurance employed as a means of guaranteeing the
performance of goods and designed to benefit the purchasers or
users of such goods.
(C) Title insurance.
(D) Insurance written in connection with an indebtedness and
intended as a means of repaying such indebtedness in the event
of the death or disability of the insured.
(E) Insurance provided by or through motorists service clubs or
associations.
(F) Insurance that is provided to the purchaser or holder of an air
transportation ticket and that:
(i) insures against death or nonfatal injury that occurs during
the flight to which the ticket relates;
(ii) insures against personal injury or property damage that
occurs during travel to or from the airport in a common carrier
immediately before or after the flight;
(iii) insures against baggage loss during the flight to which the
ticket relates; or
(iv) insures against a flight cancellation to which the ticket
relates.
(14) Refusing, because of the for-profit status of a hospital or
medical facility, to make payments otherwise required to be made
under a contract or policy of insurance for charges incurred by an
insured in such a for-profit hospital or other for-profit medical
facility licensed by the state department of health.
(15) Refusing to insure an individual, refusing to continue to issue
insurance to an individual, limiting the amount, extent, or kind of
coverage available to an individual, or charging an individual a
different rate for the same coverage, solely because of that
individual's blindness or partial blindness, except where the
refusal, limitation, or rate differential is based on sound actuarial
principles or is related to actual or reasonably anticipated
experience.
SECTION 1, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
JULY 1, 2003]: Sec. 16.5. (a) As used in this section, "delivery state"
means any state other than Indiana in which a policy is delivered or
issued for delivery.
(b) Except as provided in subsection (c), (d), or (e), a certificate may
not be issued to a resident of Indiana pursuant to a group policy that is
delivered or issued for delivery in a state other than Indiana.
(c) A certificate may be issued to a resident of Indiana pursuant to a
group policy not described in subsection (d) that is delivered or issued
for delivery in a state other than Indiana if:
(1) the delivery state has a law substantially similar to section 16
of this chapter;
(2) the delivery state has approved the group policy; and
(3) the policy or the certificate contains provisions that are:
(A) substantially similar to the provisions required by:
(i) section 19 of this chapter;
(ii) section 21 of this chapter; and
(iii)
IC 27-8-5.6
; and
(B) consistent with the requirements set forth in:
(i) section 24 of this chapter;
(ii)
IC 27-8-6
;
(iii)
IC 27-8-14
;
(iv)
IC 27-8-23
;
(v) 760 IAC 1-38.1; and
(vi) 760 IAC 1-39.
(d) A certificate may be issued to a resident of Indiana under an
association group policy, a discretionary group policy, or a trust group
policy that is delivered or issued for delivery in a state other than
Indiana if:
(1) the delivery state has a law substantially similar to section 16
of this chapter;
(2) the delivery state has approved the group policy; and
(3) the policy or the certificate contains provisions that are:
(A) substantially similar to the provisions required by:
(i) section 19 of this chapter;
(ii) section 19.2 of this chapter if the policy or certificate
contains a waiver of coverage;
(iii) section 21 of this chapter; and
(iii) (iv)
IC 27-8-5.6
; and
(B) consistent with the requirements set forth in:
(i) section 15.6 of this chapter;
(ii) section 24 of this chapter;
(iii) section 26 of this chapter;
(iv)
IC 27-8-6
;
(v)
IC 27-8-14
;
(vi)
IC 27-8-14.1
;
(vii)
IC 27-8-14.5
;
(viii)
IC 27-8-14.7
;
(ix)
IC 27-8-14.8
;
(x)
IC 27-8-20
;
(xi)
IC 27-8-23
;
notice provided under subsection (e)(2)(A) and the waiver included
in the offer of coverage and in the certificate of coverage under
subsection (e)(2)(B) to acknowledge acceptance of the waiver of
coverage.
(g) An insurer shall not, on the basis of a waiver contained in a
policy as provided in this section, deny coverage for any condition,
complication, service, or treatment that is not specified as required
in the:
(1) written notice under subsection (e)(2)(A); and
(2) offer of coverage and certificate of coverage under
subsection (e)(2)(B).
(h) An individual who is covered under a policy that includes a
waiver under this section may directly appeal a denial of coverage
based on the waiver by filing a request for an external grievance
review under
IC 27-8-29
without pursuing a grievance under
IC 27-8-28.
(i) An offer of coverage under a policy that includes a waiver
under this section does not preclude eligibility for an Indiana
comprehensive health insurance association policy under
IC 27-8-10-5.1.
(j) Notwithstanding subsection (e), a policy described in
subsection (a) may not contain a waiver of coverage for:
(1) a mental health condition; or
(2) a developmental disability.
(k) A waiver under this section may be applied to a certificate of
coverage of accident and sickness insurance only at the time the
certificate is issued.
(l) An insurer or insurance producer shall not use this section to
circumvent the guaranteed access and availability provisions of
this chapter,
IC 27-8-15
, or the federal Health Insurance
Portability and Accountability Act of 1996 (P.L. 104-191).
(m) A pattern or practice of violations of this section is an unfair
method of competition or an unfair and deceptive act and practice
in the business of insurance under
IC 27-4-1-4.
(n) This section expires July 1, 2007.
requirements for accident and sickness insurance policies issued
in Indiana, as set forth in IC 27, without material underwriting
restrictions;
(2) an insurer has refused to issue insurance except at a rate
exceeding the association plan rate; or
(3) the person is a federally eligible individual.
For the purposes of this subsection, eligibility for Medicare coverage
does not disqualify a person who is less than sixty-five (65) years of
age from eligibility for an association policy.
(c) The board of directors may establish procedures that would
permit:
(1) an association policy to be issued to persons who are covered
by a group insurance arrangement when that person or a
dependent's health condition is such that the group's coverage is in
jeopardy of termination or material rate increases because of that
person's or dependent's medical claims experience; and
(2) an association policy to be issued without any limitation on
preexisting conditions to a person who is covered by a health
insurance arrangement when that person's coverage is scheduled
to terminate for any reason beyond the person's control.
(d) An association policy must provide that coverage of a dependent
unmarried child terminates when the child becomes nineteen (19) years
of age (or twenty-five (25) years of age if the child is enrolled full-time
in an accredited educational institution). The policy must also provide
in substance that attainment of the limiting age does not operate to
terminate a dependent unmarried child's coverage while the dependent
is and continues to be both:
(1) incapable of self-sustaining employment by reason of mental
retardation or mental or physical disability; and
(2) chiefly dependent upon the person in whose name the contract
is issued for support and maintenance.
However, proof of such incapacity and dependency must be furnished
to the carrier within one hundred twenty (120) days of the child's
attainment of the limiting age, and subsequently as may be required by
the carrier, but not more frequently than annually after the two (2) year
period following the child's attainment of the limiting age.
(e) An association policy that provides coverage for a family member
of the person in whose name the contract is issued must, as to the
family member's coverage, also provide that the health insurance
benefits applicable for children are payable with respect to a newly
born child of the person in whose name the contract is issued from the
moment of birth. The coverage for newly born children must consist of
coverage of injury or illness, including the necessary care and treatment
of medically diagnosed congenital defects and birth abnormalities. If
payment of a specific premium is required to provide coverage for the
child, the contract may require that notification of the birth of a child
and payment of the required premium must be furnished to the carrier
within thirty-one (31) days after the date of birth in order to have the
coverage continued beyond the thirty-one (31) day period.
(f) Except as provided in subsection (g), an association policy may
contain provisions under which coverage is excluded during a period
of three (3) months following the effective date of coverage as to a
given covered individual for preexisting conditions, as long as medical
advice or treatment was recommended or received within a period of
three (3) months before the effective date of coverage. This subsection
may not be construed to prohibit preexisting condition provisions in an
insurance policy that are more favorable to the insured.
(g) If a person applies for an association policy within six (6) months
after termination of the person's coverage under a health insurance
arrangement and the person meets the eligibility requirements of
subsection (b), then an association policy may not contain provisions
under which:
(1) coverage as to a given individual is delayed to a date after the
effective date or excluded from the policy; or
(2) coverage as to a given condition is denied;
on the basis of a preexisting health condition. This subsection may not
be construed to prohibit preexisting condition provisions in an
insurance policy that are more favorable to the insured.
(h) For purposes of this section, coverage under a health insurance
arrangement includes, but is not limited to, coverage pursuant to the
Consolidated Omnibus Budget Reconciliation Act of 1985.
notified of the resolution; and
(2) provide for:
(A) an expedited external grievance review for a grievance
related to an illness, a disease, a condition, an injury, or a
disability if the time frame for a standard review would seriously
jeopardize the covered individual's:
(i) life or health; or
(ii) ability to reach and maintain maximum function; or
(B) a standard external grievance review for a grievance not
described in clause (A).
A covered individual may file not more than one (1) external grievance
of an insurer's appeal resolution under this chapter.
(b) Subject to the requirements of subsection (d), when a request is
filed under subsection (a), the insurer shall:
(1) select a different independent review organization for each
external grievance filed under this chapter from the list of
independent review organizations that are certified by the
department under section 19 of this chapter; and
(2) rotate the choice of an independent review organization among
all certified independent review organizations before repeating a
selection.
(c) The independent review organization chosen under subsection (b)
shall assign a medical review professional who is board certified in the
applicable specialty for resolution of an external grievance.
(d) The independent review organization and the medical review
professional conducting the external review under this chapter may not
have a material professional, familial, financial, or other affiliation with
any of the following:
(1) The insurer.
(2) Any officer, director, or management employee of the insurer.
(3) The health care provider or the health care provider's medical
group that is proposing the service.
(4) The facility at which the service would be provided.
(5) The development or manufacture of the principal drug, device,
procedure, or other therapy that is proposed for use by the treating
health care provider.
(6) The covered individual requesting the external grievance
review.
However, the medical review professional may have an affiliation
under which the medical review professional provides health care
services to covered individuals of the insurer and may have an
affiliation that is limited to staff privileges at the health facility, if the
affiliation is disclosed to the covered individual and the insurer before
commencing the review and neither the covered individual nor the
insurer objects.
(e) A covered individual may be required to pay not more than
twenty-five dollars ($25) shall not pay any of the costs associated with
the services of an independent review organization under this chapter.
All additional costs must be paid by the insurer.
JULY 1, 2003]: Sec. 15. (a) An independent review organization shall:
(1) for an expedited external grievance filed under section
13(a)(2)(A) of this chapter, within three (3) business days after the
external grievance is filed; or
(2) for a standard appeal filed under section 13(a)(2)(B) of this
chapter, within fifteen (15) business days after the appeal is filed;
make a determination to uphold or reverse the insurer's appeal
resolution under
IC 27-8-28-17
based on information gathered from the
covered individual or the covered individual's designee, the insurer,
and the treating health care provider, and any additional information
that the independent review organization considers necessary and
appropriate.
(b) When making the determination under this section, the
independent review organization shall apply:
(1) standards of decision making that are based on objective
clinical evidence; and
(2) the terms of the covered individual's accident and sickness
insurance policy.
(c) In an external grievance described in section 12(4) of this
chapter, the insurer bears the burden of proving that the insurer
properly denied coverage for a condition, complication, service, or
treatment because the condition, complication, service, or
treatment is directly related to a condition for which coverage has
been waived under
IC 27-8-5-2.5
or
IC 27-8-5-19.2.
(d) The independent review organization shall notify the insurer and
the covered individual of the determination made under this section:
(1) for an expedited external grievance filed under section
13(a)(2)(A) of this chapter, within twenty-four (24) hours after
making the determination; and
(2) for a standard external grievance filed under section
13(a)(2)(B) of this chapter, within seventy-two (72) hours after
making the determination.
____________________________ ____________________________
Senator MillerRepresentative Fry
Chairperson
____________________________ ____________________________
Senator SipesRepresentative Ripley
Senate Conferees House Conferees