§ 58-68-65. Guaranteed renewability of individual health insurance coverage. - North Carolina Statutes

§58‑68‑65.  Guaranteed renewability of individual health insurancecoverage.

(a)        In General. –Except as provided in this section, a health insurer that provides individualhealth insurance coverage to an individual shall renew or continue in force thecoverage at the option of the individual.

(b)        General Exceptions.– A health insurer may nonrenew or discontinue health insurance coverage of anindividual in the individual market based only on one or more of the following:

(1)        Nonpayment ofpremiums. – The individual has failed to pay premiums or contributions inaccordance with the terms of the health insurance coverage or the healthinsurer has not received timely premium payments.

(2)        Fraud. – Theindividual has performed an act or practice that constitutes fraud or made anintentional misrepresentation of material fact under the terms of the coverage.

(3)        Termination of plan.– The health insurer is ceasing to offer coverage in the individual market inaccordance with subsection (c) of this section and this Chapter.

(4)        Movement outsideservice area. – In the case of a health insurer that offers health insurancecoverage in the market through a network plan, the individual no longerresides, lives, or works in the service area (or in an area for which thehealth insurer is authorized to do business) but only if the coverage isterminated under this subdivision uniformly without regard to any health status‑relatedfactor of covered individuals.

(5)        Associationmembership ceases. – In the case of health insurance coverage that is madeavailable in the individual market only through one or more bona fideassociations, the membership of the individual in the association (on the basisof which the coverage is provided) ceases but only if the coverage is terminatedunder this subdivision uniformly without regard to any health status‑relatedfactor of covered individuals.

(c)        Requirements forUniform Termination of Coverage. –

(1)        Particular type ofcoverage not offered. – In any case in which a health insurer decides todiscontinue offering a particular type of health insurance coverage offered inthe individual market, coverage of the type may be discontinued by the healthinsurer only if:

a.         The health insurerprovides notice, notwithstanding G.S. 58‑51‑20 or G.S. 58‑65‑60(c)(3)b.,to each covered individual provided coverage of this type in the market of thediscontinuation at least 90 days before the date of the discontinuation of thecoverage;

b.         The health insureroffers to each individual in the individual market provided coverage of thistype, the option to purchase any other individual health insurance coveragecurrently being offered by the health insurer for individuals in the market;and

c.         In exercising theoption to discontinue coverage of this type and in offering the option ofcoverage under sub‑subdivision b. of this subdivision, the health insureracts uniformly without regard to any health status‑related factor ofenrolled individuals or individuals who may become eligible for the coverage.

(2)        Discontinuance ofall coverage. –

a.         In general. –Subject to sub‑subdivision c. of this subdivision, in any case in which ahealth insurer elects to discontinue offering all health insurance coverage inthe individual market in this State, health insurance coverage may bediscontinued by the health insurer only if: (i) the health insurer providesnotice to the Commissioner and to each individual of the discontinuation atleast 180 days before the date of the expiration of the coverage, and (ii) allhealth insurance coverage issued or delivered for issuance in this State in themarket is discontinued and the health insurance coverage in the market is notrenewed.

b.         Prohibition onmarket reentry. – In the case of a discontinuation under sub‑subdivisiona. of this subdivision in the individual market, the health insurer shall notprovide for the issuance of any health insurance coverage in the market andthis State during the five‑year period beginning on the date of thediscontinuation of the last health insurance coverage not so renewed.

(d)        Exception forUniform Modification of Coverage. – At the time of coverage renewal, a healthinsurer may modify the health insurance coverage for a policy form offered toindividuals in the individual market as long as the modification is consistentwith State law and effective on a uniform basis among all individuals with thatpolicy form.

(e)        Application toCoverage Offered Only Through Associations. – In applying this section in thecase of health insurance coverage that is made available by a health insurer inthe individual market to individuals only through one or more associations, areference to an "individual" is deemed to include a reference to theassociation of which the individual is a member. (1997‑259, s. 1(c).)