§ 27-18.5-3 - Guaranteed availability to certain individuals. - Rhode Island Statutes

SECTION 27-18.5-3

   § 27-18.5-3  Guaranteed availability tocertain individuals. – (a) Notwithstanding any of the provisions of this title to the contrary, allhealth insurance carriers that offer health insurance coverage in theindividual market in this state shall provide for the guaranteed availabilityof coverage to an eligible individual or an individual who has had healthinsurance coverage, including coverage in the individual market, or coverageunder a group health plan or coverage under 5 U.S.C. § 8901 et seq. andhad that coverage continuously for at least twelve (12) consecutive months andwho applies for coverage in the individual market no later than sixty-three(63) days following termination of the coverage, desiring to enroll inindividual health insurance coverage, and who is not eligible for coverageunder a group health plan, part A or part B or title XVIII of the SocialSecurity Act, 42 U.S.C. § 1395c et seq. or 42 U.S.C. § 1395j et seq.,or any state plan under title XIX of the Social Security Act, 42 U.S.C. §1396 et seq. (or any successor program) and does not have other healthinsurance coverage (provided, that eligibility for the other coverage shall notdisqualify an individual with twelve (12) months of consecutive coverage ifthat individual applies for coverage in the individual market for the primarypurpose of obtaining coverage for a specific pre-existing condition, and theother available coverage excludes coverage for that pre-existing condition) andmay not:

   (1) Decline to offer the coverage to, or deny enrollment of,the individual; or

   (2) Impose any preexisting condition exclusion with respectto the coverage.

   (b) All health insurance carriers that offer health insurancecoverage in the individual market in this state shall offer all policy forms ofhealth insurance coverage. Provided, the carrier may elect to limit thecoverage offered so long as it offers at least two (2) different policy formsof health insurance coverage (policy forms which have different cost-sharingarrangements or different riders shall be considered to be different policyforms) both of which:

   (i) Are designed for, made generally available to, andactively market to, and enroll both eligible and other individuals by thecarrier; and

   (ii) Meet the requirements of subparagraph (A) or (B) of thisparagraph as elected by the carrier:

   (A) If the carrier offers the policy forms with the largest,and next to the largest, premium volume of all the policy forms offered by thecarrier in this state; or

   (B) If the carrier offers a choice of two (2) policy formswith representative coverage, consisting of a lower-level coverage policy formand a higher-level coverage policy form each of which includes benefitssubstantially similar to other individual health insurance coverage offered bythe carrier in this state and each of which is covered under a method thatprovides for risk adjustment, risk spreading, or financial subsidization.

   (2) For the purposes of this subsection, "lower-levelcoverage" means a policy form for which the actuarial value of the benefitsunder the coverage is at least eighty-five percent (85%) but not greater thanone hundred percent (100%) of the policy form weighted average.

   (3) For the purposes of this subsection, "higher-levelcoverage" means a policy form for which the actuarial value of the benefitsunder the coverage is at least fifteen percent (15%) greater than the actuarialvalue of lower-level coverage offered by the carrier in this state, and theactuarial value of the benefits under the coverage is at least one hundredpercent (100%) but not greater than one hundred twenty percent (120%) of thepolicy form weighted average.

   (4) For the purposes of this subsection, "policy formweighted average" means the average actuarial value of the benefits provided byall the health insurance coverage issued (as elected by the carrier) either bythat carrier or, if the data are available, by all carriers in this state inthe individual market during the previous year (not including coverage issuedunder this subsection), weighted by enrollment for the different coverage. Theactuarial value of benefits shall be calculated based on a standardizedpopulation and a set of standardized utilization and cost factors.

   (5) The carrier elections under this subsection shall applyuniformly to all eligible individuals in this state for that carrier. Theelection shall be effective for policies offered during a period of not shorterthan two (2) years.

   (c) A carrier may deny health insurance coverage in theindividual market to an eligible individual if the carrier has demonstrated tothe director that:

   (i) It does not have the financial reserves necessary tounderwrite additional coverage; and

   (ii) It is applying this subsection uniformly to allindividuals in the individual market in this state consistent with applicablestate law and without regard to any health status-related factor of theindividuals and without regard to whether the individuals are eligibleindividuals.

   (2) A carrier upon denying individual health insurancecoverage in this state in accordance with this subsection may not offer thatcoverage in the individual market in this state for a period of one hundredeighty (180) days after the date the coverage is denied or until the carrierhas demonstrated to the director that the carrier has sufficient financialreserves to underwrite additional coverage, whichever is later.

   (d) Nothing in this section shall be construed to requirethat a carrier offering health insurance coverage only in connection with grouphealth plans or through one or more bona fide associations, or both, offerhealth insurance coverage in the individual market.

   (e) A carrier offering health insurance coverage inconnection with group health plans under this title shall not be deemed to be ahealth insurance carrier offering individual health insurance coverage solelybecause the carrier offers a conversion policy.

   (f) Except for any high risk pool rating rules to beestablished by the Office of the Health Insurance Commissioner (OHIC) asdescribed in this section, nothing in this section shall be construed to createadditional restrictions on the amount of premium rates that a carrier maycharge an individual for health insurance coverage provided in the individualmarket; or to prevent a health insurance carrier offering health insurancecoverage in the individual market from establishing premium rates or modifyingapplicable copayments or deductibles in return for adherence to programs ofhealth promotion and disease prevention.

   (g) OHIC may pursue federal funding in support of thedevelopment of a high risk pool for the individual market, as defined in §27-18.5-2, contingent upon a thorough assessment of any financial obligation ofthe state related to the receipt of said federal funding being presented to,and approved by, the general assembly by passage of concurrent general assemblyresolution. The components of the high risk pool program, including, but notlimited to, rating rules, eligibility requirements and administrativeprocesses, shall be designed in accordance with § 2745 of the PublicHealth Service Act (42 U.S.C. § 300gg-45) also known as the State HighRisk Pool Funding Extension Act of 2006 and defined in regulations promulgatedby the office of the health insurance commissioner on or before October 1, 2007.

   (h) In the case of a health insurance carrier that offershealth insurance coverage in the individual market through a network plan, thecarrier may limit the individuals who may be enrolled under that coverage tothose who live, reside, or work within the service areas for the network plan;and within the service areas of the plan, deny coverage to individuals if thecarrier has demonstrated to the director that:

   (i) It will not have the capacity to deliver servicesadequately to additional individual enrollees because of its obligations toexisting group contract holders and enrollees and individual enrollees; and

   (ii) It is applying this subsection uniformly to individualswithout regard to any health status-related factor of the individuals andwithout regard to whether the individuals are eligible individuals.

   (2) Upon denying health insurance coverage in any servicearea in accordance with the terms of this subsection, a carrier may not offercoverage in the individual market within the service area for a period of onehundred eighty (180) days after the coverage is denied.