Bill Text: OR HB3441 | 2011 | Regular Session | Introduced

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Bill Title: Relating to health insurance coverage of inmates.

Spectrum: Partisan Bill (Republican 1-0)

Status: (Failed) 2011-06-30 - In committee upon adjournment. [HB3441 Detail]

Download: Oregon-2011-HB3441-Introduced.html

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     76th OREGON LEGISLATIVE ASSEMBLY--2011 Regular Session

NOTE:  Matter within  { +  braces and plus signs + } in an
amended section is new. Matter within  { -  braces and minus
signs - } is existing law to be omitted. New sections are within
 { +  braces and plus signs + } .

LC 3359

                         House Bill 3441

Sponsored by Representative SHEEHAN

                             SUMMARY

The following summary is not prepared by the sponsors of the
measure and is not a part of the body thereof subject to
consideration by the Legislative Assembly. It is an editor's
brief statement of the essential features of the measure as
introduced.

  Prohibits health insurers from denying coverage on basis that
individual is taken into custody of law enforcement or is
incarcerated. Authorizes law enforcement authority to pay health
insurance premiums on behalf of inmates. Extends period for
requesting individual health insurance coverage if group coverage
terminates due to loss of employment or membership in group, if
insured is in custody of law enforcement or is incarcerated.

                        A BILL FOR AN ACT
Relating to health insurance coverage of inmates; creating new
  provisions; and amending ORS 743.610 and 743.760.
Be It Enacted by the People of the State of Oregon:
  SECTION 1.  { + Section 2 of this 2011 Act is added to and made
a part of the Insurance Code. + }
  SECTION 2.  { + A policy of health insurance may not exclude
coverage of health services or supplies or deny or terminate
coverage of an individual residing in this state on the basis
that the individual is in the custody of a state or local law
enforcement authority, is incarcerated in jail or prison or is
entitled to publicly funded medical care. + }
  SECTION 3.  { + The Department of Corrections or a state or
local law enforcement authority may elect to continue health
insurance coverage and to pay the health insurance premiums on
behalf of any person:
  (1) Who is in the custody of the department or a law
enforcement authority or is incarcerated in jail or prison;
  (2) For whom the department or a law enforcement authority must
provide medical care; and
  (3) Who is eligible to apply for coverage under ORS 743.610 or
743.760, 42 U.S.C. 300gg-41 or section 4980B(f) of the Internal
Revenue Code or was enrolled in a health benefit plan paid for in
whole or in part by the state. + }
  SECTION 4. ORS 743.610 is amended to read:
  743.610. (1) A group health insurance policy providing coverage
for hospital or medical expenses, other than coverage limited to
expenses from accidents or specific diseases, must contain a
provision that certificate holders whose coverage under the
policy otherwise would terminate because of termination of
employment or membership may continue coverage under the policy
for themselves and their eligible dependents as provided in this
section.
  (2) Continuation of coverage is available only to a certificate
holder who has been insured continuously under the policy or
similar predecessor policy during the three-month period ending
on the date of the termination of employment or membership.
  (3) Continuation of coverage is not available to a certificate
holder who is eligible for:
  (a) Federal Medicare coverage; or
  (b) Coverage for hospital or medical expenses under any other
program which was not covering the certificate holder immediately
before the certificate holder's termination of employment or
membership.
  (4) The continued coverage need not include benefits for
dental, vision care or prescription drug expense, or any other
benefits under the policy additional to hospital and medical
expense benefits.
  (5) Except as provided by  { + subsection (8) of this section
or by + } rule by the Director of the Department of Consumer and
Business Services under section 2, chapter 73, Oregon Laws 2009,
a certificate holder who has terminated employment or membership
and who wishes to continue coverage must request continuation in
writing:
  (a) Not later than 10 days after the later of the date on which
employment or membership terminated and the date on which the
employer or group policyholder gave the certificate holder notice
of the right to continue coverage; and
  (b) Not more than 31 days after the date of termination of
employment or membership.
  (6) A certificate holder who requests continuation of coverage
shall pay the premium on a monthly basis and in advance, as
provided in this subsection. The certificate holder shall pay the
premium to the insurer or to the employer or policyholder,
whichever the group policy provides. The required premium payment
may not exceed the group premium rate for the insurance being
continued under the group policy as of the date the premium
payment is due. Except as otherwise provided by  { + subsection
(8) of this section or by + } rule by the director under section
2, chapter 73, Oregon Laws 2009, the certificate holder must pay
the first premium not later than 31 days after the date on which
the certificate holder's coverage under the policy otherwise
would end.
  (7) Except as otherwise provided by rule by the director under
section 2, chapter 73, Oregon Laws 2009, continuation of coverage
as provided under this section ends on the earliest of the
following dates:
  (a) Nine months after the date on which the certificate
holder's coverage under the policy otherwise would have ended
because of termination of employment or membership { +  or, for a
certificate holder described in subsection (8) of this section,
when the certificate holder is no longer in custody or
incarcerated + }.
  (b) The end of the period for which the certificate holder { +
or a person acting on behalf of the certificate holder + } last
made timely premium payment, if the certificate holder fails to
make timely payment of a required premium payment.
  (c) The premium payment due date coinciding with or next
following the date the certificate holder becomes eligible for
federal Medicare coverage.
  (d) The date on which the policy is terminated or the
certificate holder's employer terminates participation under the
policy. However, if the employer replaces the coverage which is
terminating for the certificate holder with similar coverage
under another group policy:
  (A) The certificate holder may obtain coverage under the
replacement group policy for the balance of the period that the
certificate holder would have remained covered under the replaced
group policy under this section;
  (B) The replacement group policy must provide, at a minimum,
the applicable level of benefits of the replaced policy reduced
by any benefits still payable under that policy; and
  (C) The replaced policy must continue to provide benefits to
the certificate holder to the extent of that policy's accrued
liabilities and extensions of benefits as if the replacement had
not occurred.
   { +  (8) A certificate holder who is in the custody of a state
or local law enforcement authority or who is incarcerated in jail
or prison may continue coverage under this section if the
certificate holder or a person acting on behalf of the
certificate holder:
  (a) Requests continuation of coverage not later than 63 days
after the later of the date the individual was taken into custody
or the date the individual was incarcerated; and
  (b) Pays the first premium not later than 31 days after the
date of the request for continuation of coverage and pays
subsequent premiums. + }
    { - (8) - }  { +  (9) + } The group health insurance policy
must contain a provision that:
  (a) The surviving spouse of a certificate holder, if any, who
is not eligible for continuation of coverage under ORS 743.600
may continue coverage under the policy, at the death of the
certificate holder, with respect to the spouse and any dependent
children whose coverage under the policy otherwise would
terminate because of the death, in the same manner that a
certificate holder may exercise the right under this section.
  (b) The spouse of a certificate holder, if any, who is not
eligible for continuation of coverage under ORS 743.600 may
continue coverage under the policy, upon dissolution of marriage
with the certificate holder, with respect to the spouse and any
children whose coverage under the policy otherwise would
terminate because of the dissolution of marriage, in the same
manner that a certificate holder may exercise the right under
this section.
  (c) A spouse who requests continuation of coverage under this
subsection must pay the premium for the spouse and any dependent
children, on a monthly basis and in advance, as provided in this
paragraph. The spouse shall pay the premium to the insurer or to
the employer or policyholder, whichever the group policy
provides.  The required premium payment under this subsection may
not exceed the group premium rate, for the insurance being
continued under the group policy, as of the date the premium
payment is due.
    { - (9) - }  { +  (10) + } A certificate holder who has
terminated employment by reason of layoff may not be subject upon
any rehire that occurs within nine months of the time of the
layoff to any waiting period prerequisite to coverage under the
employer's group health insurance policy if the certificate
holder was eligible for coverage at the time of the termination
and regardless of whether the certificate holder continued
coverage during the layoff.
    { - (10) - }  { +  (11) + } This section applies only to
employers who are not required to make available continuation of
health insurance benefits under Titles X and XXII of the
Consolidated Omnibus Budget Reconciliation Act of 1985, as
amended, P.L. 99-272, April 7, 1986.
  SECTION 5. ORS 743.610, as amended by section 4, chapter 73,
Oregon Laws 2009, is amended to read:
  743.610. (1) A group health insurance policy providing coverage
for hospital or medical expenses, other than coverage limited to
expenses from accidents or specific diseases, must contain a
provision that certificate holders whose coverage under the
policy otherwise would terminate because of termination of
employment or membership may continue coverage under the policy

for themselves and their eligible dependents as provided in this
section.
  (2) Continuation of coverage is available only to a certificate
holder who has been insured continuously under the policy or
similar predecessor policy during the three-month period ending
on the date of the termination of employment or membership.
  (3) Continuation of coverage is not available to a certificate
holder who is eligible for:
  (a) Federal Medicare coverage; or
  (b) Coverage for hospital or medical expenses under any other
program which was not covering the certificate holder immediately
before the certificate holder's termination of employment or
membership.
  (4) The continued coverage need not include benefits for
dental, vision care or prescription drug expense, or any other
benefits under the policy additional to hospital and medical
expense benefits.
  (5)  { + Except as provided by subsection (8) of this
section, + } a certificate holder who has terminated employment
or membership and who wishes to continue coverage must request
continuation in writing:
  (a) Not later than 10 days after the later of the date on which
employment or membership terminated and the date on which the
employer or group policyholder gave the certificate holder notice
of the right to continue coverage; and
  (b) Not more than 31 days after the date of termination of
employment or membership.
  (6) A certificate holder who requests continuation of coverage
shall pay the premium on a monthly basis and in advance, as
provided in this subsection. The certificate holder shall pay the
premium to the insurer or to the employer or policyholder,
whichever the group policy provides. The required premium payment
may not exceed the group premium rate for the insurance being
continued under the group policy as of the date the premium
payment is due.  { + Except as provided by subsection (8) of this
section, + } the certificate holder must pay the first premium
not later than 31 days after the date on which the certificate
holder's coverage under the policy otherwise would end.
  (7) Continuation of coverage as provided under this section
ends on the earliest of the following dates:
  (a) Nine months after the date on which the certificate
holder's coverage under the policy otherwise would have ended
because of termination of employment or membership { +  or, for a
certificate holder described in subsection (8) of this section,
when the certificate holder is no longer in custody or
incarcerated + }.
  (b) The end of the period for which the certificate holder
 { + or a person acting on behalf of the certificate holder + }
last made timely premium payment, if the certificate holder fails
to make timely payment of a required premium payment.
  (c) The premium payment due date coinciding with or next
following the date the certificate holder becomes eligible for
federal Medicare coverage.
  (d) The date on which the policy is terminated or the
certificate holder's employer terminates participation under the
policy. However, if the employer replaces the coverage which is
terminating for the certificate holder with similar coverage
under another group policy:
  (A) The certificate holder may obtain coverage under the
replacement group policy for the balance of the period that the
certificate holder would have remained covered under the replaced
group policy under this section;
  (B) The replacement group policy must provide, at a minimum,
the applicable level of benefits of the replaced policy reduced
by any benefits still payable under that policy; and

  (C) The replaced policy must continue to provide benefits to
the certificate holder to the extent of that policy's accrued
liabilities and extensions of benefits as if the replacement had
not occurred.
   { +  (8) A certificate holder who is in the custody of a state
or local law enforcement authority or who is incarcerated in jail
or prison may continue coverage under this section if the
certificate holder or a person acting on behalf of the
certificate holder:
  (a) Requests continuation of coverage not later than 63 days
after the later of the date the individual was taken into custody
or the date the individual was incarcerated; and
  (b) Pays the first premium not later than 31 days after the
date of the request for continuation of coverage and pays
subsequent premiums. + }
    { - (8) - }  { +  (9) + } The group health insurance policy
must contain a provision that:
  (a) The surviving spouse of a certificate holder, if any, who
is not eligible for continuation of coverage under ORS 743.600
may continue coverage under the policy, at the death of the
certificate holder, with respect to the spouse and any dependent
children whose coverage under the policy otherwise would
terminate because of the death, in the same manner that a
certificate holder may exercise the right under this section.
  (b) The spouse of a certificate holder, if any, who is not
eligible for continuation of coverage under ORS 743.600 may
continue coverage under the policy, upon dissolution of marriage
with the certificate holder, with respect to the spouse and any
children whose coverage under the policy otherwise would
terminate because of the dissolution of marriage, in the same
manner that a certificate holder may exercise the right under
this section.
  (c) A spouse who requests continuation of coverage under this
subsection must pay the premium for the spouse and any dependent
children, on a monthly basis and in advance, as provided in this
paragraph. The spouse shall pay the premium to the insurer or to
the employer or policyholder, whichever the group policy
provides.  The required premium payment under this subsection may
not exceed the group premium rate, for the insurance being
continued under the group policy, as of the date the premium
payment is due.
    { - (9) - }  { +  (10) + } A certificate holder who has
terminated employment by reason of layoff may not be subject upon
any rehire that occurs within nine months of the time of the
layoff to any waiting period prerequisite to coverage under the
employer's group health insurance policy if the certificate
holder was eligible for coverage at the time of the termination
and regardless of whether the certificate holder continued
coverage during the layoff.
    { - (10) - }  { +  (11) + } This section applies only to
employers who are not required to make available continuation of
health insurance benefits under Titles X and XXII of the
Consolidated Omnibus Budget Reconciliation Act of 1985, as
amended, P.L. 99-272, April 7, 1986.
  SECTION 6. ORS 743.760 is amended to read:
  743.760. (1) As used in this section:
  (a) 'Carrier' means an insurer authorized to issue a policy of
health insurance in this state. 'Carrier' does not include a
multiple employer welfare arrangement.
  (b)(A) 'Eligible individual' means an individual who:
  (i) Has left coverage that was continuously in effect for a
period of 180 days or more under one or more Oregon group health
benefit plans, has applied for portability coverage not later
than the 63rd day after termination of group coverage issued by
an Oregon carrier and is an Oregon resident at the time of such
application;   { - or - }
  (ii) On or after January 1, 1998, meets the eligibility
requirements of 42 U.S.C. 300gg-41, as amended and in effect on
January 1, 1998, has applied for portability coverage not later
than the 63rd day after termination of group coverage issued by
an Oregon carrier and is an Oregon resident at the time of such
application { + ; or
  (iii) Is not described in sub-subparagraph (i) or (ii) of this
subparagraph but:
  (I) Has left coverage that was continuously in effect for a
period of 180 days or more under one or more Oregon group health
benefit plans or meets the eligibility requirements of 42 U.S.C.
300gg-41;
  (II) Is taken into the custody of a state or local law
enforcement authority or is incarcerated in jail or prison in
this state not later than 63 days after leaving coverage as
described in this sub-subparagraph; and
  (III) Applies for portability coverage not later than 63 days
after the later of the date the individual is taken into custody
or the date the individual is incarcerated + }.
  (B) Except as provided in subsection (12) of this section, '
eligible individual' does not include an individual who remains
eligible for the individual's prior group coverage or would
remain eligible for prior group coverage in a plan under the
federal Employee Retirement Income Security Act of 1974, as
amended, were it not for action by the plan sponsor relating to
the actual or expected health condition of the individual, or who
is covered under another health benefit plan at the time that
portability coverage would commence or is eligible for the
federal Medicare program.
  (c) 'Portability health benefit plans' and 'portability plans'
mean health benefit plans for eligible individuals that are
required to be offered by all carriers offering group health
benefit plans and that have been approved by the Director of the
Department of Consumer and Business Services in accordance with
this section.
  (2)(a) In order to improve the availability and affordability
of health benefit plans for individuals leaving coverage under
group health benefit plans, the Health Insurance Reform Advisory
Committee created under ORS 743.745 shall submit to the director
two portability health benefit plans pursuant to ORS 743.745. One
plan shall be in the form of insurance and the second plan shall
be consistent with the type of coverage provided by health
maintenance organizations. For each type of portability plan, the
committee shall design and submit to the director:
  (A) A prevailing benefit plan, which shall reflect the benefit
coverages that are prevalent in the group health insurance
market; and
  (B) A low cost benefit plan, which shall emphasize
affordability for eligible individuals.
  (b) Except as provided in ORS 743.730 to 743.773, no law
requiring the coverage or the offer of coverage of a health care
service or benefit shall apply to portability health benefit
plans.
  (3) The director shall approve the portability health benefit
plans if the director determines that the plans provide for
appropriate accessibility and affordability of needed health care
services and comply with all other provisions of this section.
  (4) After the director's approval of the portability plans
submitted by the committee under this section, each carrier
offering group health benefit plans shall submit to the director
the policy form or forms containing at least one low cost benefit
and one prevailing benefit portability plan offered by the
carrier that meets the required standards. Each policy form must
be submitted as prescribed by the director and is subject to
review and approval pursuant to ORS 742.003.

  (5) Within 180 days after approval by the director of the
portability plans submitted by the committee, as a condition of
transacting group health insurance in this state, each carrier
offering group health benefit plans shall make available to
eligible individuals the prevailing benefit and low cost benefit
portability plans that have been submitted by the carrier and
approved by the director under subsection (4) of this section.
  (6) A carrier offering group health benefit plans shall issue
to an eligible individual who is leaving or has left group
coverage provided by that carrier any portability plan offered by
the carrier if the eligible individual   { - applies for the plan
within 63 days of termination of prior coverage and - }  agrees
to make the required premium payments and to satisfy the other
provisions of the portability plan.
  (7) Premium rates for portability plans shall be subject to the
following provisions:
  (a) Each carrier must file the geographic average rate for each
of its portability health benefit plans for a rating period with
the director on or before March 15 of each year.
  (b) The premium rates charged during the rating period for each
portability health benefit plan shall not vary from the
geographic average rate, except that the premium rate may be
adjusted to reflect differences in benefit design, family
composition and age. Adjustments for age shall comply with the
following:
  (A) For each plan, the variation between the lowest premium
rate and the highest premium rate shall not exceed 100 percent of
the lowest premium rate.
  (B) Premium variations shall be determined by applying
uniformly the carrier's schedule of age adjustments for
portability plans as approved by the director.
  (c) Premium variations between the portability plans and the
rest of the carrier's group plans must be based solely on
objective differences in plan design or coverage and must not
include differences based on the actual or expected health status
of individuals who select portability health benefit plans. For
purposes of determining the premium variations under this
paragraph, a carrier may:
  (A) Pool all portability plans with all group health benefit
plans; or
  (B) Pool all portability plans for eligible individuals leaving
small employer group health benefit plan coverage with all plans
offered to small employers and pool all portability plans for
eligible individuals leaving other group health benefit plan
coverage with all health benefit plans offered to such other
groups.
  (d) A carrier may not increase the rates of a portability plan
issued to an enrollee more than once in any 12-month period.
Annual rate increases shall be effective on the anniversary date
of the plan issued to the enrollee. The percentage increase in
the premium rate charged to an enrollee for a new rating period
may not exceed the average increase in the rest of the carrier's
applicable group health benefit plans plus an adjustment for age.
  (8) No portability plans under this section may contain
preexisting conditions provisions, exclusion periods, waiting
periods or other similar limitations on coverage.
  (9) Portability health benefit plans shall be renewable with
respect to all enrollees at the option of the enrollee, except:
  (a) For nonpayment of the required premiums by the
policyholder;
  (b) For fraud or misrepresentation by the policyholder;
  (c) When the carrier elects to discontinue offering all of its
group health benefit plans in accordance with ORS 743.737 and
743.754; or
  (d) When the director orders the carrier to discontinue
coverage in accordance with procedures specified or approved by
the director upon finding that the continuation of the coverage
would:
  (A) Not be in the best interests of the enrollees; or
  (B) Impair the carrier's ability to meet its contractual
obligations.
  (10)(a) Each carrier offering group health benefit plans shall
maintain at its principal place of business a complete and
detailed description of its rating practices and renewal
underwriting practices relating to its portability plans,
including information and documentation that demonstrate that its
rating methods and practices are based upon commonly accepted
actuarial practices and are in accordance with sound actuarial
principles.
  (b) Each such carrier shall file with the director annually on
or before March 15 an actuarial certification that the carrier is
in compliance with this section and that its rating methods are
actuarially sound. Each such certification shall be in a form and
manner and shall contain such information as specified by the
director. A copy of such certification shall be retained by the
carrier at its principal place of business.
  (c) Each such carrier shall make the information and
documentation described in paragraph (a) of this subsection
available to the director upon request. Except as provided in ORS
743.018 and except in cases of violations of the Insurance Code,
the information is proprietary and trade secret information and
shall not be subject to disclosure by the director to persons
outside the Department of Consumer and Business Services except
as agreed to by the carrier or as ordered by a court of competent
jurisdiction.
  (11) A carrier offering group health benefit plans shall not
provide any financial or other incentive to any insurance
producer that would encourage the insurance producer to market
and sell portability plans of the carrier on the basis of an
eligible individual's anticipated claims experience.
  (12) An individual who is eligible to obtain a portability plan
in accordance with this section may obtain such a plan regardless
of whether the eligible individual qualifies for a period of
continuation coverage under federal law or under ORS 743.600 or
743.610. However, an individual who has elected such continuation
coverage is not eligible to obtain a portability plan until the
continuation coverage has been discontinued by the individual or
has been exhausted.
  SECTION 7.  { + Section 2 of this 2011 Act applies to health
insurance policies issued or renewed on or after the effective
date of this 2011 Act. + }
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