Citations Affected: IC 27-1; IC 27-8; IC 27-13.
Synopsis: Insurance mandate review task force and coverage
documents. Adds one member and provides for per diem payment and
cost reimbursement for members of the task force to review mandated
benefits and mandated benefit proposals. Specifies certain
requirements for the task force. Expires the task force on December 31,
2010. Provides that certain accident and sickness insurers, health
maintenance organizations, and limited service health maintenance
organizations: (1) may provide certain documents in electronic or paper
form; (2) must provide certain information concerning obtaining
evidence of coverage; and (3) must provide documents in paper form
upon request.
Effective: July 1, 2005.
January 6, 2005, read first time and referred to Committee on Health and Provider
Services.
February 24, 2005, amended, reported favorably _ Do Pass.
February 28, 2005, read second time, ordered engrossed. Engrossed.
March 1, 2005, read third time, passed. Yeas 48, nays 0.
A BILL FOR AN ACT to amend the Indiana Code concerning
insurance.
benefit proposal each year.
(l) In assessing a mandated benefit or mandated benefit
proposal, and to the extent that information is available, the task
force shall consider:
(1) social impacts, including:
(A) the extent to which the service that is the subject of the
mandated benefit or mandated benefit proposal is
generally used by a significant part of the population;
(B) the extent to which the health coverage is already
generally available;
(C) if the health coverage is not generally available, the
extent to which the lack of health coverage results in
unreasonable financial hardship;
(D) the level of public demand for the service that is the
subject of the mandated benefit or mandated benefit
proposal;
(E) the level of public demand for the health coverage; and
(F) the extent to which the service that is the subject of the
mandated benefit or mandated benefit proposal is covered
under self-funded health coverage provided by Indiana
employers that employ at least five hundred (500)
employees;
(2) medical impacts, including the extent to which the service
that is the subject of the mandated benefit or mandated
benefit proposal is generally:
(A) recognized by the medical community as effective in
patient treatment;
(B) demonstrated by a review of scientific and peer review
literature to be recognized by the medical community; and
(C) available and used by treating physicians; and
(3) financial impacts, including the:
(A) extent to which the health coverage will increase or
decrease the cost of the service that is the subject of the
mandated benefit or mandated benefit proposal;
(B) extent to which the health coverage will increase the
appropriate use of the service that is the subject of the
mandated benefit or mandated benefit proposal;
(C) extent to which the service that is the subject of the
mandated benefit or mandated benefit proposal will be a
substitute for a more expensive service;
(D) extent to which the health coverage will increase or
decrease the:
implement this section.
(l) (s) Information that identifies a person and that is obtained by the
task force under this section is confidential.
(t) This section expires December 31, 2010.
left-hand corner of the first page of the policy.
(7) The policy contains no provision purporting to make any
portion of the charter, rules, constitution, or bylaws of the insurer
a part of the policy unless such portion is set forth in full in the
policy, except in the case of the incorporation of or reference to
a statement of rates or classification of risks, or short-rate table
filed with the commissioner.
(8) If an individual accident and sickness insurance policy or
hospital service plan contract or medical service plan contract
provides that hospital or medical expense coverage of a
dependent child terminates upon attainment of the limiting age for
dependent children specified in such policy or contract, the policy
or contract must also provide that attainment of such limiting age
does not operate to terminate the hospital and medical coverage
of such child while the child is and continues to be both:
(A) incapable of self-sustaining employment by reason of
mental retardation or mental or physical disability; and
(B) chiefly dependent upon the policyholder for support and
maintenance.
Proof of such incapacity and dependency must be furnished to the
insurer by the policyholder within thirty-one (31) days of the child's
attainment of the limiting age. The insurer may require at reasonable
intervals during the two (2) years following the child's attainment of the
limiting age subsequent proof of the child's disability and dependency.
After such two (2) year period, the insurer may require subsequent
proof not more than once each year. The foregoing provision shall not
require an insurer to insure a dependent who is a mentally retarded or
mentally or physically disabled child where such dependent does not
satisfy the conditions of the policy provisions as may be stated in the
policy or contract required for coverage thereunder to take effect. In
any such case the terms of the policy or contract shall apply with regard
to the coverage or exclusion from coverage of such dependent.
This subsection applies only to policies or contracts delivered or
issued for delivery in this state more than one hundred twenty (120)
days after August 18, 1969.
(b) If any policy is issued by an insurer domiciled in this state for
delivery to a person residing in another state, and if the official having
responsibility for the administration of the insurance laws of such other
state shall have advised the commissioner that any such policy is not
subject to approval or disapproval by such official, the commissioner
may by ruling require that such policy meet the standards set forth in
subsection (a) and in section 3 of this chapter.
by the insured person.
However, a provision under this subdivision may not preclude the
assertion at any time of defenses based upon a person's
ineligibility for coverage under the policy or based upon other
provisions in the policy.
(3) A provision that a copy of the application, if there is one, of
the policyholder must be attached to the policy when issued, that
all statements made by the policyholder or by the persons insured
are to be deemed representations and not warranties, and that no
statement made by any person insured may be used in any contest
unless a copy of the instrument containing the statement is or has
been furnished to the insured person or, in the event of death or
incapacity of the insured person, to the insured person's
beneficiary or personal representative.
(4) A provision setting forth the conditions, if any, under which
the insurer reserves the right to require a person eligible for
insurance to furnish evidence of individual insurability
satisfactory to the insurer as a condition to part or all of the
person's coverage.
(5) A provision specifying any additional exclusions or limitations
applicable under the policy with respect to a disease or physical
condition of a person that existed before the effective date of the
person's coverage under the policy and that is not otherwise
excluded from the person's coverage by name or specific
description effective on the date of the person's loss. An exclusion
or limitation that must be specified in a provision under this
subdivision:
(A) may apply only to a disease or physical condition for
which medical advice, diagnosis, care, or treatment was
received by the person or recommended to the person during
the six (6) months before the enrollment date of the person's
coverage; and
(B) may not apply to a loss incurred or disability beginning
after the earlier of:
(i) the end of a continuous period of twelve (12) months
beginning on or after the enrollment date of the person's
coverage; or
(ii) the end of a continuous period of eighteen (18) months
beginning on the enrollment date of the person's coverage if
the person is a late enrollee.
This subdivision applies only to group policies of accident and
sickness insurance other than those described in section 2.5(a)(1)
through 2.5(a)(8) of this chapter.
(6) A provision specifying any additional exclusions or limitations
applicable under the policy with respect to a disease or physical
condition of a person that existed before the effective date of the
person's coverage under the policy. An exclusion or limitation that
must be specified in a provision under this subdivision:
(A) may apply only to a disease or physical condition for
which medical advice or treatment was received by the person
during a period of three hundred sixty-five (365) days before
the effective date of the person's coverage; and
(B) may not apply to a loss incurred or disability beginning
after the earlier of the following:
(i) The end of a continuous period of three hundred
sixty-five (365) days, beginning on or after the effective date
of the person's coverage, during which the person did not
receive medical advice or treatment in connection with the
disease or physical condition.
(ii) The end of the two (2) year period beginning on the
effective date of the person's coverage.
This subdivision applies only to group policies of accident and
sickness insurance described in section 2.5(a)(1) through
2.5(a)(8) of this chapter.
(7) If premiums or benefits under the policy vary according to a
person's age, a provision specifying an equitable adjustment of:
(A) premiums;
(B) benefits; or
(C) both premiums and benefits;
to be made if the age of a covered person has been misstated. A
provision under this subdivision must contain a clear statement of
the method of adjustment to be used.
(8) A provision that the insurer will issue to the policyholder, for
delivery to each person insured, a certificate, in electronic or
paper form, setting forth a statement that:
(A) explains the insurance protection to which the person
insured is entitled;
(B) indicates to whom the insurance benefits are payable; and
(C) explains any family member's or dependent's coverage
under the policy.
The provision must specify that the certificate will be
provided in paper form upon the request of the insured.
(9) A provision stating that written notice of a claim must be
given to the insurer within twenty (20) days after the occurrence
or commencement of any loss covered by the policy, but that a
failure to give notice within the twenty (20) day period does not
invalidate or reduce any claim if it can be shown that it was not
reasonably possible to give notice within that period and that
notice was given as soon as was reasonably possible.
(10) A provision stating that:
(A) the insurer will furnish to the person making a claim, or to
the policyholder for delivery to the person making a claim,
forms usually furnished by the insurer for filing proof of loss;
and
(B) if the forms are not furnished within fifteen (15) days after
the insurer received notice of a claim, the person making the
claim will be deemed to have complied with the requirements
of the policy as to proof of loss upon submitting, within the
time fixed in the policy for filing proof of loss, written proof
covering the occurrence, character, and extent of the loss for
which the claim is made.
(11) A provision stating that:
(A) in the case of a claim for loss of time for disability, written
proof of the loss must be furnished to the insurer within ninety
(90) days after the commencement of the period for which the
insurer is liable, and that subsequent written proofs of the
continuance of the disability must be furnished to the insurer
at reasonable intervals as may be required by the insurer;
(B) in the case of a claim for any other loss, written proof of
the loss must be furnished to the insurer within ninety (90)
days after the date of the loss; and
(C) the failure to furnish proof within the time required under
clause (A) or (B) does not invalidate or reduce any claim if it
was not reasonably possible to furnish proof within that time,
and if proof is furnished as soon as reasonably possible but
(except in case of the absence of legal capacity of the
claimant) no later than one (1) year from the time proof is
otherwise required under the policy.
(12) A provision that:
(A) all benefits payable under the policy (other than benefits
for loss of time) will be paid in accordance with IC 27-8-5.7;
and
(B) subject to due proof of loss, all accrued benefits under the
policy for loss of time will be paid not less frequently than
monthly during the continuance of the period for which the
insurer is liable, and any balance remaining unpaid at the
termination of the period for which the insurer is liable will be
paid as soon as possible after receipt of the proof of loss.
(13) A provision that benefits for loss of life of the person insured
are payable to the beneficiary designated by the person insured.
However, if the policy contains conditions pertaining to family
status, the beneficiary may be the family member specified by the
policy terms. In either case, payment of benefits for loss of life is
subject to the provisions of the policy if no designated or
specified beneficiary is living at the death of the person insured.
All other benefits of the policy are payable to the person insured.
The policy may also provide that if any benefit is payable to the
estate of a person or to a person who is a minor or otherwise not
competent to give a valid release, the insurer may pay the benefit,
up to an amount of five thousand dollars ($5,000), to any relative
by blood or connection by marriage of the person who is deemed
by the insurer to be equitably entitled to the benefit.
(14) A provision that the insurer has the right and must be
allowed the opportunity to:
(A) examine the person of the individual for whom a claim is
made under the policy when and as often as the insurer
reasonably requires during the pendency of the claim; and
(B) conduct an autopsy in case of death if it is not prohibited
by law.
(15) A provision that no action at law or in equity may be brought
to recover on the policy less than sixty (60) days after proof of
loss is filed in accordance with the requirements of the policy and
that no action may be brought at all more than three (3) years after
the expiration of the time within which proof of loss is required
by the policy.
(16) In the case of a policy insuring debtors, a provision that the
insurer will furnish to the policyholder, for delivery to each debtor
insured under the policy, a certificate of insurance describing the
coverage and specifying that the benefits payable will first be
applied to reduce or extinguish the indebtedness.
(17) If the policy provides that hospital or medical expense
coverage of a dependent child of a group member terminates upon
the child's attainment of the limiting age for dependent children
set forth in the policy, a provision that the child's attainment of the
limiting age does not terminate the hospital and medical coverage
of the child while the child is:
(A) incapable of self-sustaining employment because of
mental retardation or mental or physical disability; and
organizations, such accident and sickness insurance claim forms as the
commissioner determines will provide for uniformity and simplicity in
insurance reporting. The forms shall include, but need not be limited
to, information regarding the medical diagnosis, treatment and
prognosis of the patient, together with the details of charges incident to
the providing of care, treatment or services, sufficient for the purpose
of meeting the proof requirements of an accident or sickness insurance
policy or a hospital, medical, or dental service contract.
(b) An accident and sickness insurer may not refuse to accept a
claim submitted on duly promulgated uniform claim forms. However,
an insurer may accept claims submitted on any other form.
(c) Accident and sickness insurer explanation of benefits paid
statements or claims summary statements sent to an insured by the
accident and sickness insurer may be sent in electronic or paper
form and shall be in a format and written in a manner that promotes
understanding by the insured by setting forth:
(1) the total dollar amount submitted to the insurer for payment;
(2) any reduction in the amount paid due to the application of any
co-payment or deductible, along with an explanation of the
amount of the co-payment or deductible applied under the
insured's policy;
(3) any reduction in the amount paid due to the application of any
other policy limitation or exclusion as set forth in the insured's
policy along with an explanation thereof;
(4) the total dollar amount paid; and
(5) the total dollar amount remaining unpaid.
In addition, the explanation shall clearly set forth a toll free number
that the insured may call to obtain additional information about any of
the items contained in the explanation of benefits paid or claims
summary statement.
(d) The commissioner may issue an order under IC 27-1-3-19(a)
directing an accident and sickness insurer to comply with subsection
(c).
(e) An accident and sickness insurer does not violate subsection (c)
by using a document that the accident and sickness insurer has been
required to use by the federal government or the state.
(f) An accident and sickness insurer shall:
(1) inform an insured that the insured may request that the
statements described in subsection (c) be sent in paper form;
and
(2) send the statements in paper form upon the request of the
insured.