Bill Text: OR SB100 | 2011 | Regular Session | Introduced
Bill Title: Relating to health benefit plans.
Sponsorship: Unknown
Status: (Failed) 2011-06-30 - In committee upon adjournment. [SB100 Detail]
Download: Oregon-2011-SB100-Introduced.html
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 656
Senate Bill 100
Printed pursuant to Senate Interim Rule 213.28 by order of the
President of the Senate in conformance with presession filing
rules, indicating neither advocacy nor opposition on the part
of the President (at the request of Governor John A. Kitzhaber
for Oregon Health Authority)
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.
Requires health insurance carriers to offer health benefit plan
that provides bronze plan coverage. Specifies requirements for
catastrophic plan. Transfers responsibility for prescribing basic
health plan coverage and terms from Health Insurance Reform
Advisory Committee to Department of Consumer and Business
Services and eliminates committee. Specifies operative date of
January 2, 2014.
A BILL FOR AN ACT
Relating to health benefit plans; creating new provisions; and
amending ORS 413.032, 735.616, 742.005, 743.730, 743.733,
743.734, 743.736, 743.737, 743.745, 743.748, 743.751, 743.752,
743.754, 743.760, 743.766 and 743.878 and sections 3 and 4,
chapter 75, Oregon Laws 2010.
Be It Enacted by the People of the State of Oregon:
SECTION 1. { + Sections 2, 3 and 4 of this 2011 Act are added
to and made a part of ORS 743.730 to 743.773. + }
SECTION 2. { + In consultation with the Department of Consumer
and Business Services, the Oregon Health Authority shall
prescribe by rule the:
(1) Requirements for a bronze plan so that it is actuarially
equivalent to 60 percent of the full actuarial value of benefits
included in the essential health benefits package prescribed by
the United States Secretary of Health and Human Services under 42
U.S.C. 18022(a).
(2) Form, level of coverage and benefit design for the bronze
plan to be used by carriers in the health benefit plan market in
this state. + }
SECTION 3. { + As a condition of transacting business in the
health benefit plan market in this state, a carrier shall offer
to residents of this state a bronze plan approved by the
Department of Consumer and Business Services as meeting the
requirements of section 2 of this 2011 Act. A carrier must offer
the bronze plan:
(1) Through the Oregon Health Insurance Exchange if the carrier
offers a health benefit plan through the exchange.
(2) In the health benefit plan market outside the exchange if
the carrier offers a health benefit plan outside the
exchange. + }
SECTION 4. { + A carrier may offer a catastrophic plan only
through the Oregon Health Insurance Exchange and only to an
individual who:
(1) Is under 30 years of age at the beginning of the plan year;
or
(2) Is exempt from any state or federal penalties imposed for
failing to maintain minimal essential coverage during the plan
year. + }
SECTION 5. ORS 742.005 is amended to read:
742.005. The Director of the Department of Consumer and
Business Services shall disapprove any form requiring the
director's approval:
(1) If the director finds it does not comply with the law;
(2) If the director finds it contains any provision, including
statement of premium, or has any label, description of its
contents, title, heading, backing or other indication of its
provisions, which is unintelligible, uncertain, ambiguous or
abstruse, or likely to mislead a person to whom the policy is
offered, delivered or issued;
(3) If, in the director's judgment, its use would be
prejudicial to the interests of the insurer's policyholders;
(4) If the director finds it contains provisions which are
unjust, unfair or inequitable;
(5) If the director finds sales presentation material
disapproved by the director pursuant to ORS 742.009 is being used
with respect to the form; or
(6) If, with respect to any of the following forms, the
director finds the benefits provided therein are not reasonable
in relation to the premium charged:
(a) Individual health insurance policy forms, including benefit
certificates issued by fraternal benefit societies and individual
policies issued by health care service contractors, but excluding
policies referred to in ORS 743.402 as exempt from the
application of ORS 743.405 to 743.498, 743A.160 and 743A.164;
(b) { - Small employer - } Group health benefit plan forms
for small employers as that term is defined in ORS 743.730,
including
{ - small employer - } group policies { + for small
employers + } issued by health care service contractors; or
(c) Credit life and credit health insurance forms subject to
ORS 743.371 to 743.380.
SECTION 6. ORS 743.730 is amended to read:
743.730. For purposes of ORS 743.730 to 743.773:
(1) 'Actuarial certification' means a written statement by a
member of the American Academy of Actuaries or other individual
acceptable to the Director of the Department of Consumer and
Business Services that a carrier is in compliance with the
provisions of ORS 743.736, 743.760 or 743.761, based upon the
person's examination, including a review of the appropriate
records and of the actuarial assumptions and methods used by the
carrier in establishing premium rates for { - small employer
and - } portability health benefit plans { + and health benefit
plans for small employers + }.
(2) 'Affiliate' of, or person 'affiliated' with, a specified
person means any carrier who, directly or indirectly through one
or more intermediaries, controls or is controlled by or is under
common control with a specified person. For purposes of this
definition, 'control' has the meaning given that term in ORS
732.548.
(3) 'Affiliation period' means, under the terms of a group
health benefit plan issued by a health care service contractor, a
period:
(a) That is applied uniformly and without regard to any health
status related factors to an enrollee or late enrollee in lieu of
a preexisting conditions provision;
(b) That must expire before any coverage becomes effective
under the plan for the enrollee or late enrollee;
(c) During which no premium shall be charged to the enrollee or
late enrollee; and
(d) That begins on the enrollee's or late enrollee's first date
of eligibility for coverage and runs concurrently with any
eligibility waiting period under the plan.
(4) 'Basic health benefit plan' means a health benefit plan
{ - for small employers - } { + that provides bronze plan
coverage and + } that is required to be offered by all
{ - small employer - } carriers and approved by the
{ - director of the - } Department of Consumer and Business
Services in accordance with { - ORS 743.736 - } { + section 3
of this 2011 Act + }.
(5) 'Bona fide association' means an association that meets the
requirements of 42 U.S.C. 300gg-11 as amended and in effect on
July 1, 1997.
{ + (6) 'Bronze plan' means a health benefit plan that meets
the criteria prescribed by rule by the Oregon Health Authority
pursuant to section 2 of this 2011 Act. + }
{ - (6) - } { + (7) + } 'Carrier' means any person who
provides health benefit plans in this state, including a licensed
insurance company, a health care service contractor, a health
maintenance organization, an association or group of employers
that provides benefits by means of a multiple employer welfare
arrangement or any other person or corporation responsible for
the payment of benefits or provision of services.
{ + (8) 'Catastrophic plan' means a health benefit plan that
meets the requirements for a catastrophic plan under 42 U.S.C.
18022(e) and that is offered through the Oregon Health Insurance
Exchange pursuant to section 4 of this 2011 Act. + }
{ - (7) 'Committee' means the Health Insurance Reform
Advisory Committee created under ORS 743.745. - }
{ - (8) - } { + (9) + } 'Creditable coverage' means prior
health care coverage as defined in 42 U.S.C. 300gg as amended and
in effect on July 1, 1997, and includes coverage remaining in
force at the time the enrollee obtains new coverage.
{ - (9) 'Department' means the Department of Consumer and
Business Services. - }
(10) 'Dependent' means the spouse or child of an eligible
employee, subject to applicable terms of the health benefit plan
covering the employee.
{ - (11) 'Director' means the Director of the Department of
Consumer and Business Services. - }
{ - (12) - } { + (11) + } 'Eligible employee' means an
employee of a small employer who works on a regularly scheduled
basis, with a normal work week of 17.5 or more hours. The
employer may determine hours worked for eligibility between 17.5
and 40 hours per week subject to rules of the carrier. 'Eligible
employee' does not include employees who work on a temporary,
seasonal or substitute basis. Employees who have been employed by
the small employer for fewer than 90 days are not eligible
employees unless the small employer so allows.
{ - (13) - } { + (12) + } 'Employee' means any individual
employed by an employer.
{ - (14) - } { + (13) + } 'Enrollee' means an employee,
dependent of the employee or an individual otherwise eligible for
a group, individual or portability health benefit plan who has
enrolled for coverage under the terms of the plan.
{ + (14) 'Exchange' means the Oregon Health Insurance
Exchange established pursuant to section 17, chapter 595, Oregon
Laws 2009. + }
(15) 'Exclusion period' means a period during which specified
treatments or services are excluded from coverage.
(16) { - ' Financially impaired' means a member that - }
{ + ' Financial impairment' means that a carrier + } is not
insolvent and is:
(a) Considered by the director { - of the Department of
Consumer and Business Services - } to be potentially unable to
fulfill its contractual obligations; or
(b) Placed under an order of rehabilitation or conservation by
a court of competent jurisdiction.
(17)(a) 'Geographic average rate' means the arithmetical
average of the lowest premium and the corresponding highest
premium to be charged by a carrier in a geographic area
established by the director for the carrier's:
(A) { - Small employer - } Group health benefit plans { +
offered to small employers + };
(B) Individual health benefit plans; or
(C) Portability health benefit plans.
(b) 'Geographic average rate' does not include premium
differences that are due to differences in benefit design or
family composition.
{ + (18) 'Grandfathered plan' means a health benefit plan
that meets criteria prescribed by the United States Secretary of
Health and Human Services under 42 U.S.C. 18011(e). + }
{ - (18) - } { + (19) + } 'Group eligibility waiting
period' means, with respect to a group health benefit plan, the
period of employment or membership with the group that a
prospective enrollee must complete before plan coverage begins.
{ - (19)(a) - } { + (20)(a) + } 'Health benefit plan'
means { + :
(A) + } Any hospital expense, medical expense or hospital or
medical expense policy or certificate { - , - } { + ;
(B) Any + } health care service contractor or health
maintenance organization subscriber contract { - , - } { + ; or
(C) + } Any plan provided by a multiple employer welfare
arrangement or by another benefit arrangement defined in the
federal Employee Retirement Income Security Act of 1974, as
amended.
(b) 'Health benefit plan' does not include { - coverage
for - } { + :
(A) + } Accident only { + insurance + } { - , - } { + .
(B) + } Specific disease or condition only { + insurance + }
{ - , - } { + .
(C) + } Credit { + health insurance + } { - , - } { + .
(D) + } Disability income { + insurance + } { - , - } { + .
(E) + } Coverage of Medicare services pursuant to contracts
with the federal government { - , - } { + . + } { +
(F) + } Medicare supplement insurance policies { - , - }
{ + .
(G) + } Coverage of CHAMPUS services pursuant to contracts with
the federal government { - , - } { + .
(H) + } Benefits delivered through a flexible spending
arrangement established pursuant to section 125 of the Internal
Revenue Code of 1986, as amended, when the benefits are provided
in addition to a group health benefit plan { - , - } { + .
(I) Separately offered + } long term care { - insurance - } ,
{ + nursing home care, home health care or community based care
insurance, or a combination of such types of insurance.
(J) + } Hospital indemnity only { + or fixed indemnity
insurance + } { - , - } { + .
(K) + } Short term health insurance policies { + , + }
{ - ( - } the duration of which does not exceed { - six - }
{ + 12 + } months including renewals { - ), - } { + . As used
in this subparagraph, 'renewal' means a new short term policy
issued by a carrier to a policyholder or dependents of the
policyholder no later than 45 days after the termination of a
short term policy previously issued by the carrier to the
policyholder or to dependents of the policyholder.
(L) + } Student accident { + insurance policies + } and
{ + student + } health insurance policies { + if excluded from
the definition of group health plan under 42 U.S.C. 300gg-91 + }
{ - , - } { + .
(M) Noncoordinated + } dental only { + insurance + }
{ - , - } { + .
(N) Noncoordinated + } vision only { + insurance + }
{ - , - } { + .
(O) + } A policy of stop-loss coverage that meets the
requirements of ORS 742.065 { - , - } { + .
(P) + } Coverage issued as a supplement to liability insurance
{ - , - } { + .
(Q) + } Insurance arising out of a workers' compensation or
similar law { - , - } { + .
(R) + } Automobile medical payment insurance or insurance under
which benefits are payable with or without regard to fault and
that is statutorily required to be contained in any liability
insurance policy or equivalent self-insurance.
(c) Nothing in this subsection shall be construed to regulate
any employee welfare benefit plan that is exempt from state
regulation because of the federal Employee Retirement Income
Security Act of 1974, as amended.
{ - (20) - } { + (21) + } 'Health statement' means any
information that is intended to inform the carrier or insurance
producer of the health status of an enrollee or prospective
enrollee in a health benefit plan. 'Health statement' includes
the standard health statement developed by the { - Health
Insurance Reform Advisory Committee - } { + director pursuant
to ORS 743.745 + }.
{ - (21) 'Implementation of chapter 836, Oregon Laws 1989 '
means that the Health Services Commission has prepared a priority
list, the Legislative Assembly has enacted funding of the list
and all necessary federal approval, including waivers, has been
obtained. - }
(22) 'Individual coverage waiting period' means a period in an
individual health benefit plan during which no premiums may be
collected and health benefit plan coverage issued is not
effective.
(23) 'Initial enrollment period' means a period of at least 30
days following commencement of the first eligibility period for
an individual.
(24) 'Late enrollee' means an individual who enrolls in a group
health benefit plan subsequent to the initial enrollment period
during which the individual was eligible for coverage but
declined to enroll. However, an eligible individual shall not be
considered a late enrollee if:
(a) The individual qualifies for a special enrollment period in
accordance with 42 U.S.C. 300gg as amended and in effect on July
1, 1997;
(b) The individual applies for coverage during an open
enrollment period;
(c) A court has ordered that coverage be provided for a spouse
or minor child under a covered employee's health benefit plan and
request for enrollment is made within 30 days after issuance of
the court order;
(d) The individual is employed by an employer who offers
multiple health benefit plans and the individual elects a
different health benefit plan during an open enrollment period;
or
(e) The individual's coverage under Medicaid, Medicare,
CHAMPUS, Indian Health Service or a publicly sponsored or
subsidized health plan, including but not limited to the medical
assistance program under ORS chapter 414, has been involuntarily
terminated within 63 days of applying for coverage in a group
health benefit plan.
{ + (25) 'Minimal essential coverage' has the meaning given
that term in section 5000A(f) of the Internal Revenue Code. + }
{ - (25) - } { + (26) + } 'Multiple employer welfare
arrangement' means a multiple employer welfare arrangement as
defined in section 3 of the federal Employee Retirement Income
Security Act of 1974, as amended, 29 U.S.C. 1002, that is subject
to ORS 750.301 to 750.341.
{ - (26) - } { + (27) + } 'Oregon Medical Insurance Pool'
means the pool created under ORS 735.610.
{ - (27) - } { + (28) + } 'Preexisting conditions
provision' means a health benefit plan provision applicable to an
enrollee or late enrollee that excludes coverage for services,
charges or expenses incurred during a specified period
immediately following enrollment for a condition for which
medical advice, diagnosis, care or treatment was recommended or
received during a specified period immediately preceding
enrollment. For purposes of ORS 743.730 to 743.773:
(a) Pregnancy does not constitute a preexisting condition
except as provided in ORS 743.766;
(b) Genetic information does not constitute a preexisting
condition in the absence of a diagnosis of the condition related
to such information; and
(c) A preexisting conditions provision shall not be applied to
a { - newborn child or adopted child who obtains coverage in
accordance with ORS 743A.090 - } { + person under 19 years of
age + }.
{ - (28) - } { + (29) + } 'Premium' includes insurance
premiums or other fees charged for a health benefit plan,
including the costs of benefits paid or reimbursements made to or
on behalf of enrollees covered by the plan.
{ - (29) - } { + (30) + } 'Rating period' means the
12-month calendar period for which premium rates established by a
carrier are in effect, as determined by the carrier.
{ - (30)(a) - } { + (31)(a) + } 'Small employer' means an
employer that employed an average of at least two but not more
than 50 employees on business days during the preceding calendar
year, the majority of whom are employed within this state, and
that employs at least two eligible employees on the date on which
coverage takes effect under a health benefit plan { - issued by
a small employer carrier - } .
(b) Any person that is treated as a single employer under
subsection (b), (c), (m) or (o) of section 414 of the Internal
Revenue Code of 1986 shall be treated as one employer for
purposes of this subsection.
(c) The determination of whether an employer that was not in
existence throughout the preceding calendar year is a small
employer shall be based on the average number of employees that
it is reasonably expected the employer will employ on business
days in the current calendar year.
{ - (31) 'Small employer carrier' means any carrier that
offers health benefit plans covering eligible employees of one or
more small employers. A fully insured multiple employer welfare
arrangement otherwise exempt under ORS 750.303 (4) may elect to
be a small employer carrier governed by the provisions of ORS
743.733 to 743.737. - }
SECTION 7. ORS 743.733 is amended to read:
743.733. (1) If an affiliated group of employers is treated as
a single employer under subsection (b), (c), (m) or (o) of
section 414 of the Internal Revenue Code of 1986, a carrier may
issue a single group health benefit plan to the affiliated group
on the basis of the number of employees in the affiliated group
if the group requests such coverage.
(2) If a { - small employer - } carrier determines that an
employer has more than 50 employees, the carrier may provide a
quote for a group health benefit plan that is not subject to ORS
743.733 to 743.737. If the employer's workforce consists of at
least two but not more than 50 eligible employees, the
{ - small group - } carrier shall inform the employer that if
coverage is limited to the eligible employees, the carrier must
treat the employer as a small employer and shall provide a
separate quote on that basis.
(3) Subsequent to the issuance of a health benefit plan to a
small employer, a { - small employer - } carrier shall
determine annually the number of employees of the employer for
purposes of determining the employer's ongoing eligibility as a
small employer. The provisions of ORS 743.733 to 743.737 shall
continue to apply to a health benefit plan issued to a small
employer until the plan anniversary date following the date the
employer no longer meets the definition of a small employer.
SECTION 8. ORS 743.734, as amended by section 9, chapter 752,
Oregon Laws 2007, and section 2, chapter 81, Oregon Laws 2010, is
amended to read:
743.734. (1) Every group health benefit plan shall be subject
to the provisions of ORS 743.733 to 743.737 { + and sections 2,
3 and 4 of this 2011 Act + }, if the plan provides health
benefits covering one or more employees of a small employer and
if any one of the following conditions is met:
(a) Any portion of the premium or benefits is paid by a small
employer or any eligible employee is reimbursed, whether through
wage adjustments or otherwise, by a small employer for any
portion of the health benefit plan premium; or
(b) The health benefit plan is treated by the employer or any
of the eligible employees as part of a plan or program for the
purposes of section 106, section 125 or section 162 of the
Internal Revenue Code of 1986, as amended.
(2) Except as provided in ORS 743.733 to 743.737 { + and
743.745 and sections 2 and 3 of this 2011 Act + }, no
{ + state + } law requiring the coverage or the offer of
coverage of a health care service or benefit applies to the basic
health benefit plans offered or delivered to a small employer.
(3) Except as otherwise provided by law or ORS 743.733 to
743.737, { - no health benefit plan offered to a small employer
shall - } { + a carrier offering a health benefit plan to a
small employer may + }:
(a) { - Inhibit a small employer carrier from contracting - }
{ + Contract + } with providers or groups of providers with
respect to health care services or benefits; { - or - } { +
and + }
(b) { - Impose any restriction on the ability of a small
employer carrier to - } Negotiate with providers regarding the
level or method of reimbursing care or services provided under
health benefit plans.
(4) Except to determine the application of a preexisting
conditions provision for a late enrollee { + who is 19 years of
age or older + }, a { - small employer - } carrier shall not
use health statements when offering { - small employer - }
health benefit plans { + to small employers + } and shall not
use any other method to determine the actual or expected health
status of eligible enrollees. Nothing in this subsection shall
prevent a carrier from using health statements or other
information after enrollment for the purpose of providing
services or arranging for the provision of services under a
health benefit plan.
(5) Except in the case of a late enrollee and as otherwise
provided in this section, a { - small employer - } carrier
shall not impose different terms or conditions on the coverage,
premiums or contributions of any eligible employee in a small
employer group that are based on the actual or expected health
status of any eligible employee.
(6) A { - small employer - } carrier may provide different
health benefit plans to different categories of employees of a
small employer when the employer has chosen to establish
different categories of employees in a manner that does not
relate to the actual or expected health status of such employees
or their dependents. The categories must be based on bona fide
employment-based classifications that are consistent with the
employer's usual business practice { + and may not discriminate
in favor of highly compensated individuals as defined in section
105(h) of the Internal Revenue Code + }. Except as provided in
ORS 743.736 { - (10) - } { + (8) + }:
(a) When a { - small employer - } carrier offers coverage to
a small employer with no more than 25 eligible employees, the
{ - small employer - } carrier shall offer coverage to all
eligible employees of the small employer, without regard to the
actual or expected health status of any eligible employee.
(b) When a { - small employer - } carrier offers coverage to
a small employer with at least 26 but not more than 50 eligible
employees, the { - small employer - } carrier may limit
coverage to the categories of employees that the small employer
has established as eligible for coverage, provided that the
categories are based on bona fide employment-based
classifications that are consistent with the employer's usual
business practice { + and do not discriminate in favor of highly
compensated individuals as defined in section 105(h) of the
Internal Revenue Code + }.
(c) If the small employer elects to offer coverage to
dependents of eligible employees, the { - small employer - }
carrier shall offer coverage to all dependents of eligible
employees, without regard to the actual or expected health status
of any eligible dependent.
(7) A health benefit plan issued to a small employer group
through an association health plan is exempt from
{ - subsection (1) of this section - } { + ORS 743.733 to
743.737 + }. For purposes of this subsection, an association
health plan is group health insurance described in ORS 743.522
(2) or a health benefit plan that:
(a) Is delivered or issued for delivery to:
(A) An association or trust established in this state, that
meets applicable requirements of ORS 743.524 or 743.526, or to a
multiple employer welfare arrangement located inside this state,
subject to ORS 750.301 to 750.341; or
(B) An association or trust established in another state, that
is approved by the Director of the Department of Consumer and
Business Services under ORS 731.486 (7), or a multiple employer
welfare arrangement located in another state that complies with
ORS 750.311; and
(b) Satisfies all of the following:
(A) The initial premium rate for the association health plan
does not vary by more than 50 percent across the groups of small
employers under the plan.
(B) The association policyholder does not discriminate in
membership requirements based on actual or expected health status
of individual enrollees or prospective enrollees, in accordance
with ORS 743.752 (5).
(C) Small employer groups that have two or more eligible
employees and that meet the membership requirements for the
association are not excluded from the association health plan.
(D) Except as provided in subsection (8) of this section, the
association health plan maintains a 95 percent retention rate.
(8)(a) The 95 percent retention rate in subsection (7) of this
section does not include { + small + } employer groups that:
(A) Go out of business, whether through merger, acquisition or
any other reason;
(B) No longer meet eligibility requirements for membership in
the association, including failure to pay association dues;
(C) No longer meet participation requirements for employers
that are set forth in the plan documents; or
(D) Fail to pay premiums.
(b) An association health plan that fails to maintain the 95
percent retention rate during any year may have 12 months to
correct the retention level before losing the exemption under
subsection (7) of this section.
(c) The director may exempt an association health plan from the
95 percent retention rate requirement in subsection (7) of this
section according to criteria prescribed by the director by rule.
SECTION 9. ORS 743.734, as amended by section 9, chapter 752,
Oregon Laws 2007, and sections 2 and 3, chapter 81, Oregon Laws
2010, is amended to read:
743.734. (1) Every group health benefit plan shall be subject
to the provisions of ORS 743.733 to 743.737 { + and sections 2,
3 and 4 of this 2011 Act + }, if the plan provides health
benefits covering one or more employees of a small employer and
if any one of the following conditions is met:
(a) Any portion of the premium or benefits is paid by a small
employer or any eligible employee is reimbursed, whether through
wage adjustments or otherwise, by a small employer for any
portion of the health benefit plan premium; or
(b) The health benefit plan is treated by the employer or any
of the eligible employees as part of a plan or program for the
purposes of section 106, section 125 or section 162 of the
Internal Revenue Code of 1986, as amended.
(2) Except as provided in ORS 743.733 to 743.737 { + and
743.745 and section 2 and 3 of this 2011 Act + }, no
{ + state + } law requiring the coverage or the offer of
coverage of a health care service or benefit applies to the basic
health benefit plans offered or delivered to a small employer.
(3) Except as otherwise provided by law or ORS 743.733 to
743.737, { - no health benefit plan offered to a small employer
shall - } { + a carrier offering a health benefit plan to a
small employer may + }:
(a) { - Inhibit a small employer carrier from contracting - }
{ + Contract + } with providers or groups of providers with
respect to health care services or benefits; { - or - } { +
and + }
(b) { - Impose any restriction on the ability of a small
employer carrier to - } Negotiate with providers regarding the
level or method of reimbursing care or services provided under
health benefit plans.
(4) Except to determine the application of a preexisting
conditions provision for a late enrollee { + who is 19 years of
age or older + }, a { - small employer - } carrier shall not
use health statements when offering { - small employer - }
health benefit plans { + to small employers + } and shall not
use any other method to determine the actual or expected health
status of eligible enrollees. Nothing in this subsection shall
prevent a carrier from using health statements or other
information after enrollment for the purpose of providing
services or arranging for the provision of services under a
health benefit plan.
(5) Except in the case of a late enrollee and as otherwise
provided in this section, a { - small employer - } carrier
shall not impose different terms or conditions on the coverage,
premiums or contributions of any eligible employee in a small
employer group that are based on the actual or expected health
status of any eligible employee.
(6) A { - small employer - } carrier may provide different
health benefit plans to different categories of employees of a
small employer when the employer has chosen to establish
different categories of employees in a manner that does not
relate to the actual or expected health status of such employees
or their dependents. The categories must be based on bona fide
employment-based classifications that are consistent with the
employer's usual business practice { + and may not discriminate
in favor of highly compensated individuals as defined in section
105(h) of the Internal Revenue Code + }. Except as provided in
ORS 743.736 { - (10) - } { + (8) + }:
(a) When a { - small employer - } carrier offers coverage to
a small employer with no more than 25 eligible employees, the
{ - small employer - } carrier shall offer coverage to all
eligible employees of the small employer, without regard to the
actual or expected health status of any eligible employee.
(b) When a { - small employer - } carrier offers coverage to
a small employer with at least 26 but not more than 50 eligible
employees, the { - small employer - } carrier may limit
coverage to the categories of employees that the small employer
has established as eligible for coverage, provided that the
categories are based on bona fide employment-based
classifications that are consistent with the employer's usual
business practice { + and do not discriminate in favor of highly
compensated individuals as defined in section 105(h) of the
Internal Revenue Code + }.
(c) If the small employer elects to offer coverage to
dependents of eligible employees, the { - small employer - }
carrier shall offer coverage to all dependents of eligible
employees, without regard to the actual or expected health status
of any eligible dependent.
SECTION 10. ORS 743.736 is amended to read:
743.736. { - (1) In order to improve the availability and
affordability of health benefit coverage for small employers, the
Health Insurance Reform Advisory Committee created under ORS
743.745 shall submit to the Director of the Department of
Consumer and Business Services two basic 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
requirements of the federal Health Maintenance Organization Act,
42 U.S.C. 300e et seq. - }
{ - (2)(a) The director shall approve the basic health
benefit plans following a determination that the plans provide
for maximum accessibility and affordability of needed health care
services and following a determination that the basic health
benefit plans substantially meet the social values that underlie
the ranking of benefits by the Health Services Commission and
that the basic health benefit plans are substantially similar to
the Medicaid reform program under chapter 836, Oregon Laws 1989,
funded by the Legislative Assembly. - }
{ - (b) The basic health benefit plans shall include benefits
mandated under ORS 743A.168 until mental health, alcohol and
chemical dependency services are fully integrated into the Health
Services Commission's priority list, and as funded by the
Legislative Assembly, and chapter 836, Oregon Laws 1989, is
implemented. - }
{ - (c) The commission shall aid the director by reviewing
the basic health benefit plans and commenting on the extent to
which the plans meet these criteria. - }
{ - (3) - } { + (1) + } { - After the director's approval
of the basic health benefit plans submitted by the committee
pursuant to subsection (1) of this section, each small
employer - } { + A + } carrier shall submit to the Director
{ + of the Department of Consumer and Business Services, for
approval in accordance with ORS 742.003, + } the policy form or
forms containing its basic health benefit plan. { - Each policy
form must be submitted as prescribed by the director and is
subject to review and approval pursuant to ORS 742.003. - }
{ - (4)(a) As a condition of transacting business in the
small employer health insurance market in this state, every small
employer carrier shall offer small employers an approved basic
health benefit plan and any other plans that have been submitted
by the small employer carrier for use in the small employer
market and approved by the director. - }
{ - (b) Nothing in this subsection shall require a small
employer carrier to resubmit small employer health benefit plans
that were approved by the director prior to October 1, 1996, nor
shall small employer carriers be required to reinitiate new plan
selection procedures for currently enrolled small employers prior
to the small employer's next health benefit plan coverage
anniversary date. - }
{ - (c) - } { + (2) + } A carrier that offers a health
benefit plan in the small employer market only through one or
more bona fide associations is not required to offer that health
benefit plan to small employers that are not members of the bona
fide association.
{ - (5) - } { + (3) + } { - A small employer - } { +
A + } carrier shall issue to a small employer any { - small
employer - } health benefit plan { + , including a basic health
benefit plan, that is + } offered by the carrier if the small
employer applies for the plan and agrees to make the required
premium payments and to satisfy the other provisions of the
health benefit plan.
{ - (6) - } { + (4) + } A multiple employer welfare
arrangement, professional or trade association or other similar
arrangement established or maintained to provide benefits to a
particular trade, business, profession or industry or their
subsidiaries shall not issue coverage to a group or individual
that is not in the same trade, business, profession or industry
as that covered by the arrangement. The arrangement shall accept
all groups and individuals in the same trade, business,
profession or industry or their subsidiaries that apply for
coverage under the arrangement and that meet the requirements for
membership in the arrangement. For purposes of this subsection,
the requirements for membership in an arrangement shall not
include any requirements that relate to the actual or expected
health status of the prospective enrollee.
{ - (7) - } { + (5) + } { - A small employer - } { +
A + } carrier shall, pursuant to
{ - subsections (4) and (5) - } { + subsection (3) + }of
this section, { - offer coverage to or accept applications from
a - } { + accept applications from and offer coverage to a
small employer + } group covered under an existing { - small
employer - } health benefit plan whether or not a prospective
enrollee is excluded from coverage under the existing plan
because of late enrollment. When a { - small employer - }
carrier accepts an application for { - such - } a { + small
employer + } group, the carrier may continue to exclude the
prospective enrollee excluded from coverage by the replaced plan
until the prospective enrollee would have become eligible for
coverage under that replaced plan.
{ - (8) - } { + (6) + } { - No small employer carrier
shall be required to offer coverage or accept applications
pursuant to subsections (4) and (5) - } { + A carrier is not
required to accept applications from and offer coverage pursuant
to subsection (3) + } of this section if the director finds that
acceptance of an application or applications would endanger the
carrier's ability to fulfill its contractual obligations or
result in financial impairment of the carrier.
{ - (9) - } { + (7) + } { - Every small employer - }
{ + A + } carrier shall market fairly all { - small
employer - } health benefit plans { + that are not
grandfathered plans, including basic health benefit plans, that
are + } offered by the carrier to small employers in the
geographical areas in which the carrier makes coverage available
or provides benefits.
{ - (10)(a) - } { + (8)(a) + } { - No small employer
carrier shall be - } { + A carrier is not + }required to { +
accept applications from or + } offer coverage { - or accept
applications - } pursuant to { - subsections (4) and (5) - }
{ + subsection (3) + } of this section { - in the case of any
of the following - } :
(A) To a small employer if the small employer is not physically
located in the carrier's approved service area;
(B) To an employee { + of a small employer + } if the employee
does not work or reside within the carrier's approved service
areas; or
(C) Within an area where the carrier reasonably anticipates,
and demonstrates to the satisfaction of the director, that it
will not have the capacity in its network of providers to deliver
services adequately to the enrollees of those groups because of
its obligations to existing group contract holders and enrollees.
(b) A carrier that does not offer coverage pursuant to
paragraph (a)(C) of this subsection shall not offer coverage in
the applicable service area to new employer groups other than
small employers until the carrier resumes enrolling groups of new
small employers in the applicable area.
{ - (11) - } { + (9) + } For purposes of ORS 743.733 to
743.737, except as provided in this subsection, carriers that are
affiliated carriers or that are eligible to file a consolidated
tax return pursuant to ORS 317.715 shall be treated as one
carrier and any restrictions or limitations imposed by ORS
743.733 to 743.737 apply as if all health benefit plans delivered
or issued for delivery to small employers in this state by the
affiliated carriers were issued by one carrier. However, any
insurance company or health maintenance organization that is an
affiliate of a health care service contractor located in this
state, or any health maintenance organization located in this
state that is an affiliate of an insurance company or health care
service contractor, may treat the health maintenance organization
as a separate carrier and each health maintenance organization
that operates only one health maintenance organization in a
service area in this state may be considered a separate carrier.
{ - (12) - } { + (10) + } { - A small employer - } { +
A + } carrier that { - , after September 29, 1991, - } elects
to discontinue offering all of its
{ - small employer - } health benefit plans { + to small
employers + } under ORS 743.737 (5)(e), elects to discontinue
renewing all such plans or elects to discontinue offering and
renewing all such plans is prohibited from offering health
benefit plans { - in the small employer market - } { + to
small employers + } in this state for a period of five years from
one of the following dates:
(a) The date of notice to the director pursuant to ORS 743.737
(5)(e); or
(b) If notice is not provided under paragraph (a) of this
subsection, from the date on which the director provides notice
to the carrier that the director has determined that the carrier
has effectively discontinued offering { - small employer - }
health benefit plans { + to small employers + } in this state.
SECTION 11. ORS 743.737 is amended to read:
743.737. { - Health benefit plans covering small employers
shall be subject to the following provisions: - }
(1) A preexisting conditions provision in a { - small
employer - } health benefit plan { - shall - } { + issued to
a small employer may + } apply only to a condition for which
medical advice, diagnosis, care or treatment was recommended or
received during the six-month period immediately preceding the
enrollment date of an enrollee or late enrollee. { - As used
in - } { + For purposes of + } this section, the enrollment
date of an enrollee shall be the earlier of the effective date of
coverage or the first day of any required group eligibility
waiting period and the enrollment date of a late enrollee shall
be the effective date of coverage.
(2) A preexisting conditions provision in a { - small
employer - } health benefit plan { + issued to a small
employer + } shall terminate its effect as follows:
(a) For an enrollee, not later than the first of the following
dates:
(A) Six months following the enrollee's effective date of
coverage; or
(B) Ten months following the start of any required group
eligibility waiting period.
(b) For a late enrollee, not later than 12 months following the
late enrollee's effective date of coverage.
(3) In applying a preexisting conditions provision to an
enrollee or late enrollee, except as provided in this subsection,
all { - small employer - } health benefit plans { + issued to
small employers + } shall reduce the duration of the provision by
an amount equal to the enrollee's or late enrollee's aggregate
periods of creditable coverage if the most recent period of
creditable coverage is ongoing or ended within 63 days of the
enrollment date in the new { - small employer - } health
benefit plan. The crediting of prior coverage in accordance with
this subsection shall be applied without regard to the specific
benefits covered during the prior period. This subsection does
not preclude, within a { - small employer - } health benefit
plan { + issued to a small employer + }, application of:
(a) An affiliation period that does not exceed two months for
an enrollee or three months for a late enrollee; or
(b) An exclusion period for specified covered services, as
established by the { - Health Insurance Reform Advisory
Committee - } { + Department of Consumer and Business
Services + }, applicable to all individuals enrolling for the
first time in the { - small employer - } health benefit plan.
(4) { + (a) A health benefit plan issued to a small employer
may not apply a preexisting conditions provision to a person who
is under the age of 19.
(b) + } Late enrollees { + in a health benefit plan issued to
a small employer + } may be excluded from coverage for up to 12
months or may be subjected to a preexisting conditions provision
for up to 12 months. If both an exclusion from coverage period
and a preexisting conditions provision are applicable to a late
enrollee, the combined period shall not exceed 12 months.
(5) { - Each small employer - } { + A + } health benefit
plan { + issued to a small employer + } shall be renewable with
respect to all eligible enrollees at the option of the
policyholder, small employer or contract holder { - except - }
{ + unless + }:
(a) { - For nonpayment of the required premiums by - } The
policyholder, small employer or contract holder { + fails to pay
required premiums + }.
(b) { - For fraud or misrepresentation of - } The
policyholder, small employer or contract holder or, with respect
to coverage of individual enrollees, { - the enrollees or their
representatives - } { + an enrollee or a representative of an
enrollee engages in fraud or makes an intentional
misrepresentation of material fact as prohibited by the terms of
the plan or coverage + }.
(c) { - When - } The number of enrollees covered under the
plan is less than the number or percentage of enrollees required
by participation requirements under the plan.
(d) { - For noncompliance with - } The small employer
{ - carrier's employer - } { + fails to comply with the + }
contribution requirements under the health benefit plan.
(e) { - When - } The carrier discontinues offering or
renewing, or offering and renewing, all of its { - small
employer - } health benefit plans { + for small employers + }
in this state or in a specified service area within this state.
In order to discontinue plans under this paragraph, the carrier:
(A) Must give notice of the decision to the Director of the
Department of Consumer and Business Services and to all
policyholders covered by the plans;
(B) May not cancel coverage under the plans for 180 days after
the date of the notice required under subparagraph (A) of this
paragraph if coverage is discontinued in the entire state or,
except as provided in subparagraph (C) of this paragraph, in a
specified service area;
(C) May not cancel coverage under the plans for 90 days after
the date of the notice required under subparagraph (A) of this
paragraph if coverage is discontinued in a specified service area
because of an inability to reach an agreement with the health
care providers or organization of health care providers to
provide services under the plans within the service area; and
(D) Must discontinue offering or renewing, or offering and
renewing, all health benefit plans issued by the carrier { - in
the small employer market - } { + to small employers + } in
this state or in the specified service area.
(f) { - When - } The carrier discontinues offering and
renewing a
{ - small employer - } health benefit plan { + for small
employers + } in a specified service area within this state
because of an inability to reach an agreement with the health
care providers or organization of health care providers to
provide services under the plan within the service area. In order
to discontinue a plan under this paragraph, the carrier:
(A) Must give notice to the director and to all policyholders
covered by the plan;
(B) May not cancel coverage under the plan for 90 days after
the date of the notice required under subparagraph (A) of this
paragraph; and
(C) Must offer in writing to each small employer covered by the
plan, all other { - small employer - } health benefit plans
{ + that are not grandfathered plans + } that the carrier offers
{ + to small employers + } in the specified service area. The
carrier shall issue any such plans pursuant to the provisions of
ORS 743.733 to 743.737. The carrier shall offer the plans at
least 90 days prior to discontinuation.
(g) { - When - } The carrier discontinues offering or
renewing, or offering and renewing, a health benefit plan for all
small employers in this state or in a specified service area
within this state, other than a plan discontinued under paragraph
(f) of this subsection. With respect to plans that are being
discontinued, the carrier must:
(A) Offer in writing to each small employer covered by the
plan, all health benefit plans { + that are not grandfathered
plans + } that the carrier offers { + to small employers + } in
the specified service area.
(B) Issue any such plans pursuant to the provisions of ORS
743.733 to 743.737.
(C) Offer the plans at least 90 days prior to discontinuation.
(D) Act uniformly without regard to the claims experience of
the affected policyholders or the health status of any current or
prospective enrollee.
(h) { - 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 contractual
obligations.
(i) { - When, - } In the case of a { - small employer - }
health benefit plan { + for small employers + } that delivers
covered services through a specified network of health care
providers, there is no longer any enrollee who lives, resides or
works in the service area of the provider network.
(j) { - When, - } In the case of a health benefit plan that
is offered { - in the small employer market - } { + to small
employers + } only through one or more bona fide associations,
the membership of an employer in the association ceases and the
termination of coverage is not related to the health status of
any enrollee.
{ - (k) For misuse of a provider network provision. As used
in this paragraph, 'misuse of a provider network provision' means
a disruptive, unruly or abusive action taken by An enrollee that
threatens the physical health or well-being of health care staff
and seriously impairs the ability of the carrier or its
participating providers to provide services to an enrollee. An
enrollee under this paragraph retains the rights of an enrollee
under ORS 743.804. - }
{ - (L) - } { + (6) + } A { - small employer - } carrier
may modify a { - small employer - } health benefit plan
{ + issued to a small employer + } at the time of coverage
renewal. The modification is not a discontinuation of the plan
under { - paragraphs (e) and (g) of this subsection - } { +
subsection (5)(e) and (g) of this section + }.
{ - (6) - } { + (7) + } Notwithstanding any provision of
{ - subsection - } { + subsections + } (5) { + and (6) + } of
this section to the contrary, { + a carrier may rescind + } any
small employer { - carrier - } health benefit plan { + , or
the coverage of an enrollee under a plan, + } subject to the
provisions of ORS 743.733 to 743.737 { - may be rescinded by a
small employer carrier for fraud, material misrepresentation or
concealment by a small employer and the coverage of an enrollee
may be rescinded for fraud, material misrepresentation or
concealment by the enrollee. - } { + if the small employer or
the enrollee:
(a) Performs an act, practice or omission that constitutes
fraud; or
(b) Makes an intentional misrepresentation of a material fact
as prohibited by the terms of the plan. + }
{ - (7) - } { + (8) + } A { - small employer - } carrier
may continue to enforce reasonable employer participation and
contribution requirements on small employers applying for
coverage. However, participation and contribution requirements
shall be applied uniformly among all small employer groups with
the same number of eligible employees applying for coverage or
receiving coverage from the { - small employer - } carrier. In
determining minimum participation requirements, a carrier shall
count only those employees who are not covered by an existing
group health benefit plan, Medicaid, Medicare, CHAMPUS, Indian
Health Service or a publicly sponsored or subsidized health plan,
including but not limited to the medical assistance program under
ORS chapter 414.
{ - (8) - } { + (9) + } Premium rates for { - small
employer - } health benefit plans { + for small employers + }
shall be subject to the following provisions:
(a) { - Each small employer carrier issuing health benefit
plans to small employers - } { + A carrier + } must file its
geographic average rate for a rating period with the director at
least once every 12 months.
(b)(A) The premium rates charged during a rating period
{ - for health benefit plans issued to small employers - } may
not vary from the geographic average rate by more than 50 percent
on or after January 1, 2008, except as provided in subparagraph
(D) of this paragraph.
(B) The variations in premium rates described in subparagraph
(A) of this paragraph shall be based solely on the factors
specified in subparagraph (C) of this paragraph. A { - small
employer - } carrier may elect which of the factors specified in
subparagraph (C) of this paragraph apply to premium rates for
small employers. The factors that are based on contributions or
participation may vary with the size of the employer. All other
factors must be applied in the same actuarially sound way to all
small employers.
(C) The variations in premium rates described in subparagraph
(A) of this paragraph may be based on one or more of the
following factors:
(i) The ages of enrolled employees and their dependents;
(ii) The level at which the small employer contributes to the
premiums payable for enrolled employees and their dependents;
(iii) The level at which eligible employees participate in the
health benefit plan;
(iv) The level at which enrolled employees and their dependents
engage in tobacco use;
(v) The level at which enrolled employees and their dependents
engage in health promotion, disease prevention or wellness
programs;
(vi) The period of time during which a small employer retains
uninterrupted coverage in force with the same { - small
employer - } carrier; and
(vii) Adjustments to reflect the provision of benefits not
required to be covered by the basic health benefit plan and
differences in family composition.
(D)(i) The premium rates determined in accordance with this
paragraph may be further adjusted by a { - small employer - }
carrier to reflect the expected claims experience of { - a - }
{ + the covered + } small employer, but the extent of this
adjustment may not exceed five percent of the annual premium rate
otherwise payable by the small employer. The adjustment under
this subparagraph may not be cumulative from year to year.
(ii) Except for small employers with 25 or fewer employees, the
premium rates adjusted under this subparagraph are not subject to
the provisions of subparagraph (A) of this paragraph.
(E) A { - small employer - } carrier shall apply the
carrier's schedule of premium rate variations as approved by the
director
{ - of the Department of Consumer and Business Services and - }
in accordance with this paragraph. Except as otherwise provided
in this section, the premium rate established { + by a
carrier + } for a health benefit plan { - by - } { + issued
to + } a small employer { - carrier - } shall apply uniformly
to all employees of the small employer enrolled in that plan.
(c) Except as provided in paragraph (b) of this subsection, the
variation in premium rates between different { - small
employer - } health benefit plans offered by a { - small
employer - } carrier { + to small employers + } must be based
solely on objective differences in plan design or coverage and
must not include differences based on the risk characteristics of
groups assumed to select a particular health benefit plan.
(d) A { - small employer - } carrier may not increase the
rates of a health benefit plan issued to a small employer more
than once in a 12-month period. Annual rate increases shall be
effective on the plan anniversary date of the health benefit plan
issued to a small employer. The percentage increase in the
premium rate charged to a small employer for a new rating period
may not exceed the sum of the following:
(A) The percentage change in the geographic average rate
measured from the first day of the prior rating period to the
first day of the new period; and
(B) Any adjustment attributable to changes in age, except an
additional adjustment may be made to reflect the provision of
benefits not required to be covered by the basic health benefit
plan and differences in family composition.
(e) Premium rates for health benefit plans shall comply with
the requirements of this section.
{ - (9) - } { + (10) + } In connection with the offering
for sale of any health benefit plan to a small employer, each
{ - small employer - } carrier shall make a reasonable
disclosure as part of its solicitation and sales materials of:
(a) The full array of health benefit plans { + , other than
grandfathered plans but including the basic health benefit
plan, + } that are offered to small employers by the carrier;
(b) The authority of the carrier to adjust rates, and the
extent to which the carrier will consider age, family composition
and geographic factors in establishing and adjusting rates;
(c) Provisions relating to renewability of policies and
contracts; and
(d) Provisions affecting any preexisting conditions provision.
{ - (10)(a) - } { + (11) + } { - Each small employer
carrier - } { + A carrier offering a health benefit plan for
small employers + } shall { + :
(a) + } Maintain at its principal place of business a complete
and detailed description of its rating practices and renewal
underwriting practices, 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 small employer carrier shall - } File with the
director at least once every 12 months an actuarial certification
that the carrier is in compliance with ORS 743.733 to 743.737 and
that the rating methods of the { - small employer - } carrier
are actuarially sound. Each such certification shall be in a
uniform form and manner and shall contain such information as
specified by the director. A copy of such certification shall be
retained by the { - small employer - } carrier at its
principal place of business.
(c) { - A small employer 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 ORS
743.733 to 743.737, the information shall be considered
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
{ - small employer - } carrier or as ordered by a court of
competent jurisdiction.
{ - (11) - } { + (12) + } A { - small employer - }
carrier shall not provide any financial or other incentive to any
insurance producer that would encourage the insurance producer to
market and sell health benefit plans of the carrier to small
employer groups based on a small employer group's anticipated
claims experience.
{ - (12) - } { + (13) + } For purposes of this section, the
date a { - small employer - } health benefit plan { + issued
to a small employer + } is continued shall be the anniversary
date of the first issuance of the health benefit plan.
{ - (13) - } { + (14) + } A { - small employer - }
carrier must include a provision that offers coverage to all
eligible employees and to all dependents to the extent
{ - the - } { + a small + } employer chooses to offer coverage
to dependents.
{ - (14) - } { + (15) + } All { - small employer - }
health benefit plans { + offered to small employers + } shall
contain special enrollment periods during which eligible
employees and dependents may enroll for coverage, as provided in
42 U.S.C. 300gg as amended and in effect on July 1, 1997 { + ,
and any other applicable law + }.
SECTION 12. ORS 743.745 is amended to read:
743.745. The Director of the Department of Consumer and
Business Services shall { + : + } { - appoint a Health
Insurance Reform Advisory Committee. This committee shall consist
of at least one insurance producer, one representative of a
health maintenance organization, one representative of a health
care service contractor, one representative of a domestic
insurer, one representative of a labor organization and one
representative of consumer interests and shall have
representation from the broad range of interests involved in the
small employer and individual market and shall include members
with the technical expertise necessary to carry out the following
duties: - }
(1) { - (a) Subject to approval by the director, the committee
shall recommend - } { + Determine + } the form and level of
coverages under the { - basic health benefit plans pursuant to
ORS 743.736 to be made available by small employer carriers and
the - } portability health benefit plans to be made available
pursuant to ORS 743.760 or 743.761. The { - committee shall - }
{ + director may + } take into consideration the levels of
health benefit plans provided in Oregon and the appropriate
medical and economic factors and shall establish benefit levels,
cost sharing, exclusions and limitations. The health benefit
plans described in this section may include cost containment
features including, but not limited to:
{ - (A) - } { + (a) + } Preferred provider provisions;
{ - (B) - } { + (b) + } Utilization review of health care
services including review of medical necessity of hospital and
physician services;
{ - (C) - } { + (c) + } Case management benefit
alternatives;
{ - (D) - } { + (d) + } Other managed care provisions;
{ - (E) - } { + (e) + } Selective contracting with
hospitals, physicians and other health care providers; and
{ - (F) - } { + (f) + } Reasonable benefit differentials
applicable to participating and nonparticipating providers.
{ - (b) The committee shall submit the basic and portability
health benefit plans and other recommendations to the director
within the time period established by the director. The health
benefit plans and other recommendations shall be deemed approved
unless expressly disapproved by the director within 30 days after
the date the director receives the plans. - }
(2) In order to ensure the broadest availability of { - small
employer and individual - } health benefit plans { + for small
employers and individuals + }, the { - committee shall
recommend for approval by the director - } { + director may
approve + } market conduct and other requirements for carriers
and insurance producers { - , including requirements developed
as a result of a request by the director, relating to the
following - } { + for + }:
(a) Registration by each carrier with the Department of
Consumer and Business Services of its intention to { - be a
small employer carrier - } { + offer health benefit plans to
small employers + } under ORS 743.733 to 743.737 or { - a
carrier offering - } { + to offer + } individual health benefit
plans, or both.
{ - (b) Publication by the department of Consumer and
Business Services or the committee of a list of all small
employer carriers and carriers offering individual health benefit
plans, including a potential requirement applicable to insurance
producers and carriers that no health benefit plan be sold to a
small employer or individual by a carrier not so identified as a
small employer carrier or carrier offering individual health
benefit plans. - }
{ - (c) - } { + (b) + } To the extent deemed necessary by
the { - committee - } { + director + } to ensure the fair
distribution of high-risk individuals and groups among carriers,
periodic reports by carriers and insurance producers concerning
small employer, portability and individual health benefit plans
issued { - , provided that reporting requirements shall be
limited to information concerning case characteristics and
numbers of health benefit plans in various categories marketed or
issued, or both, - } to small employers and individuals.
{ - (d) - } { + (c) + } Methods { + for + }
{ - concerning periodic demonstration by small employer - }
carriers { + offering health benefit plans to small
employers + }, carriers offering individual health benefit plans
and insurance producers { + periodically to demonstrate + } that
the { - small employer and individual - } carriers { + and
producers + } are marketing { - or issuing, or both, - }
{ + and issuing + } health benefit plans to small employers or
individuals in { - fulfillment of the purposes of - } { +
accordance with + } ORS 743.730 to 743.773.
(3) { - Subject to the approval of - } The director { - of
the Department of Consumer and Business Services, the
committee - } shall develop a standard health statement to be
used for all late enrollees and by all carriers offering
individual policies of health insurance.
(4) { - Subject to the approval of - } The director { - ,
the committee - } shall develop a list of the specified services
for
{ - small employer and - } portability plans for which
carriers may impose an exclusion period, the duration of the
allowable exclusion period for each specified service and the
manner in which credit will be given for exclusion periods
imposed pursuant to prior health insurance coverage.
SECTION 13. ORS 743.751 is amended to read:
743.751. (1) Except to determine the application of a
preexisting conditions provision for a late enrollee { + who is
19 years of age or older + }, a carrier offering group health
benefit plans shall not use health statements when offering such
plans to a group of two or more prospective certificate holders
and shall not use any other method to determine the actual or
expected health status of eligible prospective enrollees. Nothing
in this section shall prevent a carrier from using health
statements or other information after enrollment for the purpose
of providing services or arranging for the provision of services
under a health benefit plan or from obtaining aggregate group
information related to historical medical claims expenses and
health behavior surveys for rating purposes.
(2) Subsection (1) of this section { - applies only to group
health benefit plans that are not small employer - } { + does
not apply to + } health benefit plans { + for small
employers + }.
SECTION 14. ORS 743.752 is amended to read:
743.752. (1) Except in the case of a late enrollee and as
otherwise provided in this section, a carrier offering a group
health benefit plan to a group of two or more prospective
certificate holders shall not decline to offer coverage to any
eligible prospective enrollee and shall not impose different
terms or conditions on the coverage, premiums or contributions of
any enrollee in the group that are based on the actual or
expected health status of the enrollee.
(2) A carrier that elects to discontinue offering all of its
group health benefit plans under ORS 743.754 (6)(e), elects to
discontinue renewing all such plans or elects to discontinue
offering and renewing all such plans is prohibited from offering
health benefit plans in the group market in this state for a
period of five years from one of the following dates:
(a) The date of notice to the Director of the Department of
Consumer and Business Services pursuant to ORS 743.754 (6)(e); or
(b) If notice is not provided under paragraph (a) of this
subsection, from the date on which the director provides notice
to the carrier that the director has determined that the carrier
has effectively discontinued offering group health benefit plans
in this state.
(3) Subsection (1) of this section { - applies only to group
health benefit plans that are not small employer - } { + does
not apply to + } health benefit plans { + for small
employers + }.
(4) Nothing in this section shall prohibit an employer from
providing different group health benefit plans to various
categories of employees as defined by the employer nor prohibit
an employer from providing health benefit plans through different
carriers so long as the employer's categories of employees are
established in a manner that { + :
(a) + } Does not relate to the actual or expected health status
of the employees or their dependents { - . - } { + ; and
(b) Does not discriminate in favor of highly compensated
individuals as defined in section 105(h) of the Internal Revenue
Code. + }
(5) A multiple employer welfare arrangement, professional or
trade association, or other similar arrangement established or
maintained to provide benefits to a particular trade, business,
profession or industry or their subsidiaries, shall not issue
coverage to a group or individual that is not in the same trade,
business, profession or industry or their subsidiaries as that
covered by the arrangement. The arrangement { - shall - } { +
must + } accept all groups and individuals in the same trade,
business, profession or industry or their subsidiaries that apply
for coverage under the arrangement and that meet the requirements
for membership in the arrangement. For purposes of this
subsection, the requirements for membership in an arrangement
shall not include any requirements that relate to the actual or
expected health status of the prospective enrollee.
SECTION 15. ORS 743.754 is amended to read:
743.754. The following requirements apply to all group health
benefit plans covering two or more certificate holders:
(1) A preexisting conditions provision in a group health
benefit plan shall apply only to a condition for which medical
advice, diagnosis, care or treatment was recommended or received
during the six-month period immediately preceding the enrollment
date of an enrollee or late enrollee. As used in this section,
the enrollment date of an enrollee shall be the earlier of the
effective date of coverage or the first day of any required group
eligibility waiting period and the enrollment date of a late
enrollee shall { + not apply to a person under 19 years of age
and shall + } be the effective date of coverage.
(2) A preexisting conditions provision in a group health
benefit plan shall terminate its effect as follows:
(a) For an enrollee not later than the first of the following
dates:
(A) Six months following the enrollee's effective date of
coverage; or
(B) Twelve months following the start of any required group
eligibility waiting period.
(b) For a late enrollee, not later than 12 months following the
late enrollee's effective date of coverage.
(3) In applying a preexisting conditions provision to an
enrollee or late enrollee { + who is 19 years of age or
older + }, except as provided in this subsection, all group
benefit plans shall reduce the duration of the provision by an
amount equal to the enrollee's or late enrollee's aggregate
periods of creditable coverage if the most recent period of
creditable coverage is ongoing or ended within 63 days of the
enrollment date in the new group health benefit plan. The
crediting of prior coverage in accordance with this subsection
shall be applied without regard to the specific benefits covered
during the prior period. This subsection does not preclude,
within a group health benefit plan, application of:
(a) An affiliation period that does not exceed two months for
an enrollee or three months for a late enrollee; or
(b) An exclusion period for specified covered services
applicable to all individuals enrolling for the first time in the
group health benefit plan.
(4) Late enrollees { + who are 19 years of age or older + }
may be excluded from coverage for up to 12 months or may be
subjected to a preexisting conditions provision for up to 12
months. If both an exclusion from coverage period and a
preexisting conditions provision are applicable to a late
enrollee, the combined period shall not exceed 12 months.
(5) All group health benefit plans shall contain special
enrollment periods during which eligible employees and dependents
may enroll for coverage, as provided in 42 U.S.C. 300gg as
amended and in effect on July 1, 1997 { + and other applicable
law + }.
(6) Each group health benefit plan shall be renewable with
respect to all eligible enrollees at the option of the
policyholder except:
(a) For nonpayment of the required premiums by the
policyholder.
(b) For fraud or { + intentional + } misrepresentation of
{ + a material fact by + } the policyholder or, with respect to
coverage of individual enrollees, the enrollees or their
representatives.
(c) When the number of enrollees covered under the plan is less
than the number or percentage of enrollees required by
participation requirements under the plan.
(d) For noncompliance with the carrier's employer contribution
requirements under the health benefit plan.
(e) When the carrier discontinues offering or renewing, or
offering and renewing, all of its group health benefit plans in
this state or in a specified service area within this state. In
order to discontinue plans under this paragraph, the carrier:
(A) Must give notice of the decision to the Director of the
Department of Consumer and Business Services and to all
policyholders covered by the plans;
(B) May not cancel coverage under the plans for 180 days after
the date of the notice required under subparagraph (A) of this
paragraph if coverage is discontinued in the entire state or,
except as provided in subparagraph (C) of this paragraph, in a
specified service area;
(C) May not cancel coverage under the plans for 90 days after
the date of the notice required under subparagraph (A) of this
paragraph if coverage is discontinued in a specified service area
because of an inability to reach an agreement with the health
care providers or organization of health care providers to
provide services under the plans within the service area; and
(D) Must discontinue offering or renewing, or offering and
renewing, all health benefit plans issued by the carrier in the
group market in this state or in the specified service area.
(f) When the carrier discontinues offering and renewing a group
health benefit plan in a specified service area within this state
because of an inability to reach an agreement with the health
care providers or organization of health care providers to
provide services under the plan within the service area. In order
to discontinue a plan under this paragraph, the carrier:
(A) Must give notice of the decision to the director and to all
policyholders covered by the plan;
(B) May not cancel coverage under the plan for 90 days after
the date of the notice required under subparagraph (A) of this
paragraph; and
(C) Must offer in writing to each policyholder covered by the
plan, all other group health benefit plans { + except
grandfathered plans + } that the carrier offers in the specified
service area. The carrier shall offer the plans at least 90 days
prior to discontinuation.
(g) When the carrier discontinues offering or renewing, or
offering and renewing, a health benefit plan for all groups in
this state or in a specified service area within this state,
other than a plan discontinued under paragraph (f) of this
subsection. With respect to plans that are being discontinued,
the carrier must:
(A) Offer in writing to each policyholder covered by the plan,
one or more health benefit plans that the carrier offers in the
specified service area { + and that the policyholder is eligible
to purchase under applicable law + }.
(B) Offer the plans at least 90 days prior to discontinuation.
(C) Act uniformly without regard to the claims experience of
the affected policyholders or the health status of any current or
prospective enrollee.
(h) 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 contractual
obligations.
(i) When, in the case of a group health benefit plan that
delivers covered services through a specified network of health
care providers, there is no longer any enrollee who lives,
resides or works in the service area of the provider network.
(j) When, in the case of a health benefit plan that is offered
in the group market only through one or more bona fide
associations, the membership of an employer in the association
ceases and the termination of coverage is not related to the
health status of any enrollee.
{ - (k) For misuse of a provider network provision. As used
in this paragraph, 'misuse of a provider network provision' means
a disruptive, unruly or abusive action taken by an enrollee that
threatens the physical health or well-being of health care staff
and seriously impairs the ability of the carrier or its
participating providers to provide services to an enrollee. An
enrollee under this paragraph retains the rights of an enrollee
under ORS 743.804. - }
{ - (L) - } { + (k) + } A carrier may modify a group health
benefit plan at the time of coverage renewal. The modification is
not a discontinuation of the plan under paragraphs (e) and (g) of
this subsection.
(7) Notwithstanding any provision of subsection (6) of this
section to the contrary, a group health benefit plan may be
rescinded by a carrier for fraud { - , material - } { + or
intentional + } misrepresentation { - or concealment - } { +
of a material fact + } by a policyholder and the coverage of an
enrollee may be rescinded for fraud { - , material - } { + or
intentional + } misrepresentation { - or concealment - } { +
of a material fact + } by the enrollee.
(8) A carrier that continues to offer coverage in the group
market in this state is not required to offer coverage in all of
the carrier's group health benefit plans. If a carrier, however,
elects to continue a plan that is closed to new policyholders
instead of offering alternative coverage in its other group
health benefit plans, the coverage for all existing policyholders
in the closed plan is renewable in accordance with subsection (6)
of this section.
(9) This section { - applies only to group health benefit
plans that are not small employer - } { + does not apply to + }
health benefit plans { + for small employers + }.
SECTION 16. 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.
(B) Except as provided in subsection { - (12) - } { +
(11) + } 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 { + shall adopt + } 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 { + shall develop + }:
(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) The portability health plans developed by the
director shall provide for appropriate accessibility and
affordability of needed health care services and shall comply
with all other provisions of this section. + }
{ - (b) - } { + (c) + } Except as provided in ORS 743.730
to 743.773, no { + state + } 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) - } { + (3) + } { - 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) - } { + (4) + } Within 180 days after
{ - approval by - } the director
{ - of - } { + adopts + } 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) - } { + (3) + } of this section.
{ - (6) - } { + (5) + } 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) - } { + (6) + } 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 { +
for small employers + } 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) - } { + (7) + } No portability plans under this
section may contain preexisting conditions provisions, exclusion
periods, waiting periods or other similar limitations on
coverage.
{ - (9) - } { + (8) + } 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 { + intentional + } misrepresentation { + of
a material fact + } 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) - } { + (9)(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) - } { + (10) + } 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) - } { + (11) + } 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 17. ORS 743.766 is amended to read:
743.766. (1) All carriers who offer individual health benefit
plans and evaluate the health status of individuals for purposes
of eligibility shall use the standard health statement
established by the { - Health Insurance Reform Advisory
Committee - } { + Director of the Department of Consumer and
Business Services + } and may not use any other method to
determine the health status of an individual. Nothing in this
subsection shall prevent a carrier from using health information
after enrollment for the purpose of providing services or
arranging for the provision of services under a health benefit
plan.
(2)(a) If an individual is accepted for coverage under an
individual health benefit plan, the carrier shall not impose
exclusions or limitations on coverage greater than:
(A) A preexisting conditions provision that complies with the
following requirements:
(i) The provision shall apply only to a condition for which
medical advice, diagnosis, care or treatment was recommended or
received during the six-month period immediately preceding the
individual's effective date of coverage; { - and - }
(ii) The provision shall terminate its effect no later than six
months following the individual's effective date of coverage;
{ + and
(iii) The provision shall not apply to a person who is under 19
years of age; + }
(B) An individual coverage waiting period of 90 days; or
(C) An exclusion period for specified covered services
applicable to all individuals enrolling for the first time in the
individual health benefit plan.
(b) Pregnancy may constitute a preexisting condition for
purposes of this section.
(3) If the carrier elects to restrict coverage through the
application of a preexisting conditions provision or an
individual coverage waiting period provision, the carrier shall
reduce the duration of the provision by an amount equal to the
individual's aggregate periods of creditable coverage if the most
recent period of creditable coverage is ongoing or ended within
63 days of the effective date of coverage in the new individual
health benefit plan. The crediting of prior coverage in
accordance with this subsection shall be applied without regard
to the specific benefits covered during the prior period.
(4) If an eligible prospective enrollee is rejected for
coverage under an individual health benefit plan, the prospective
enrollee shall be eligible to apply for coverage under the Oregon
Medical Insurance Pool.
(5) If a carrier accepts an individual for coverage under an
individual health benefit plan, the carrier shall renew the
policy except:
(a) For nonpayment of the required premiums by the
policyholder.
(b) For fraud or { + intentional + }misrepresentation { + of
a material fact + } by the policyholder.
(c) When the carrier discontinues offering or renewing, or
offering and renewing, all of its individual health benefit plans
in this state or in a specified service area within this state.
In order to discontinue the plans under this paragraph, the
carrier:
(A) Must give notice of the decision to the Director of the
Department of Consumer and Business Services and to all
policyholders covered by the plans;
(B) May not cancel coverage under the plans for 180 days after
the date of the notice required under subparagraph (A) of this
paragraph if coverage is discontinued in the entire state or,
except as provided in subparagraph (C) of this paragraph, in a
specified service area;
(C) May not cancel coverage under the plans for 90 days after
the date of the notice required under subparagraph (A) of this
paragraph if coverage is discontinued in a specified service area
because of an inability to reach an agreement with the health
care providers or organization of health care providers to
provide services under the plans within the service area; and
(D) Must discontinue offering or renewing, or offering and
renewing, all health benefit plans issued by the carrier in the
individual market in this state or in the specified service area.
(d) When the carrier discontinues offering and renewing an
individual health benefit plan in a specified service area within
this state because of an inability to reach an agreement with the
health care providers or organization of health care providers to
provide services under the plan within the service area. In order
to discontinue a plan under this paragraph, the carrier:
(A) Must give notice of the decision to the director and to all
policyholders covered by the plan;
(B) May not cancel coverage under the plan for 90 days after
the date of the notice required under subparagraph (A) of this
paragraph; and
(C) Must offer in writing to each policyholder covered by the
plan, all other individual health benefit plans { + that are not
grandfathered plans + } that the carrier offers in the specified
service area. The carrier shall offer the plans at least 90 days
prior to discontinuation.
(e) When the carrier discontinues offering or renewing, or
offering and renewing, an individual health benefit plan for all
individuals in this state or in a specified service area within
this state, other than a plan discontinued under paragraph (d) of
this subsection. With respect to plans that are being
discontinued, the carrier must:
(A) Offer in writing to each policyholder covered by the plan,
one or more individual health benefit plans { + that are not
grandfathered plans + } that the carrier offers in the specified
service area.
(B) Offer the plans at least 90 days prior to discontinuation.
(C) Act uniformly without regard to the claims experience of
the affected policyholders or the health status of any current or
prospective enrollee.
(f) 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 enrollee; or
(B) Impair the carrier's ability to meet its contractual
obligations.
(g) When, in the case of an individual health benefit plan that
delivers covered services through a specified network of health
care providers, the enrollee no longer lives, resides or works in
the service area of the provider network and the termination of
coverage is not related to the health status of any enrollee.
(h) When, in the case of a health benefit plan that is offered
in the individual market only through one or more bona fide
associations, the membership of an individual in the association
ceases and the termination of coverage is not related to the
health status of any enrollee.
(i) For misuse of a provider network provision. As used in this
paragraph, 'misuse of a provider network provision' means a
disruptive, unruly or abusive action taken by an enrollee that
threatens the physical health or well-being of health care staff
and seriously impairs the ability of the carrier or its
participating providers to provide service to an enrollee. An
enrollee under this paragraph retains the rights of an enrollee
under ORS 743.804.
(j) A carrier may modify an individual health benefit plan at
the time of coverage renewal. The modification is not a
discontinuation of the plan under paragraphs (c) and (e) of this
subsection.
(6) Notwithstanding any other provision of this section, a
carrier may rescind an individual health benefit plan for fraud,
{ + intentional + } material misrepresentation { + of a
material fact + } or concealment by an enrollee.
(7) A carrier that withdraws from the market for individual
health benefit plans must continue to renew its portability
health benefit plans that have been approved pursuant to ORS
743.761.
(8) A carrier that continues to offer coverage in the
individual market in this state is not required to offer coverage
in all of the carrier's individual health benefit plans. However,
if a carrier elects to continue a plan that is closed to new
individual policyholders instead of offering alternative coverage
in its other individual health benefit plans, the coverage for
all existing policyholders in the closed plan is renewable in
accordance with subsection (5) of this section.
SECTION 18. Section 3, chapter 75, Oregon Laws 2010, is amended
to read:
{ + Sec. 3. + } (1) In the administration of { - small
employer - } group health insurance { + issued to small
employers + } or individual health insurance, an insurer may
communicate one or more of the following by electronic means:
(a) Quote information.
(b) Sale and enrollment information.
(c) Payment, remittance and reconciliation information.
(d) Explanation of benefits.
(e) Plan renewal information.
(f) Notifications required by law.
(g) Other communications, documentation, revisions or materials
otherwise provided on paper.
(2) Electronic administration of { - small employer - }
group or individual health insurance { - plans - } shall be
transacted using secure systems specifically designed by the
insurer for the purpose of electronic health insurance
administration.
SECTION 19. Section 4, chapter 75, Oregon Laws 2010, is amended
to read:
{ + Sec. 4. + } (1) An insurer who elects to offer discounted
rates for a health insurance plan utilizing electronic
administration shall include the schedule of discounts for
utilization of electronic administration as part of { + rate
filing for + } a { - small employer - } group health insurance
{ + issued to small employers + } or individual health insurance
{ - rate filing - } . The rate discounts may be graduated and
must be proportionate to the amount of administrative cost
savings the insurer anticipates as a result of the use of
electronic transactions described in section 3 { + , chapter 75,
Oregon Laws 2010 + } { - of this 2010 Act - } .
(2) Discounted rates allowed under this section shall be
applied uniformly to all similarly situated { - small employer
group or - } { + purchasers of group health insurance for small
employers or + } individual health insurance { - purchasers of
an insurer - } .
(3) Discounts in premium rates under this section are not
premium rate variations for purposes of ORS 743.737 { - (8) - }
{ + (9) + } or 743.767.
SECTION 20. ORS 413.032 is amended to read:
413.032. (1) The Oregon Health Authority is established. The
authority shall:
(a) Carry out policies adopted by the Oregon Health Policy
Board;
(b) Develop a plan for the Oregon Health Insurance Exchange in
accordance with section 17, chapter 595, Oregon Laws 2009;
(c) Administer the Oregon Prescription Drug Program;
(d) Administer the Family Health Insurance Assistance Program;
(e) Provide regular reports to the board with respect to the
performance of health services contractors serving recipients of
medical assistance, including reports of trends in health
services and enrollee satisfaction;
(f) Guide and support, with the authorization of the board,
community-centered health initiatives designed to address
critical risk factors, especially those that contribute to
chronic disease;
(g) Be the state Medicaid agency for the administration of
funds from Titles XIX and XXI of the Social Security Act and
administer medical assistance under ORS chapter 414;
(h) In consultation with the Director of the Department of
Consumer and Business Services, periodically review and recommend
standards and methodologies to the Legislative Assembly for:
(A) Review of administrative expenses of health insurers;
(B) Approval of rates; and
(C) Enforcement of rating rules adopted by the Department of
Consumer and Business Services;
(i) Structure reimbursement rates for providers that serve
recipients of medical assistance to reward comprehensive
management of diseases, quality outcomes and the efficient use of
resources and to promote cost-effective procedures, services and
programs including, without limitation, preventive health, dental
and primary care services, web-based office visits, telephone
consultations and telemedicine consultations;
(j) Guide and support community three-share agreements in which
an employer, state or local government and an individual all
contribute a portion of a premium for a community-centered health
initiative or for insurance coverage; and
(k) Develop, in consultation with the Department of Consumer
and Business Services { - and the Health Insurance Reform
Advisory Committee - } , one or more products designed to provide
more affordable options for the small group market.
(2) The Oregon Health Authority is authorized to:
(a) Create an all-claims, all-payer database to collect health
care data and monitor and evaluate health care reform in Oregon
and to provide comparative cost and quality information to
consumers, providers and purchasers of health care about Oregon's
health care systems and health plan networks in order to provide
comparative information to consumers.
(b) Develop uniform contracting standards for the purchase of
health care, including the following:
(A) Uniform quality standards and performance measures;
(B) Evidence-based guidelines for major chronic disease
management and health care services with unexplained variations
in frequency or cost;
(C) Evidence-based effectiveness guidelines for select new
technologies and medical equipment; and
(D) A statewide drug formulary that may be used by publicly
funded health benefit plans.
(c) Submit directly to the Legislative Counsel, no later than
October 1 of each even-numbered year, requests for measures
necessary to provide statutory authorization to carry out any of
the authority's duties or to implement any of the board's
recommendations. The measures may be filed prior to the beginning
of the legislative session in accordance with the rules of the
House of Representatives and the Senate.
(3) The enumeration of duties, functions and powers in this
section is not intended to be exclusive nor to limit the duties,
functions and powers imposed on or vested in the Oregon Health
Authority by ORS 413.006 to 413.064 or by other statutes.
SECTION 21. ORS 735.616 is amended to read:
735.616. (1) An applicant may qualify for portability health
insurance coverage under the Oregon Medical Insurance Pool if:
(a) An application for coverage is made not later than the 63rd
day after the date of first eligibility; and
(b) The individual is an Oregon resident at the time of the
application.
(2) In addition to individuals otherwise qualified under ORS
735.615, the following individuals qualify for portability health
insurance coverage under the Oregon Medical Insurance Pool:
(a) An individual who has left coverage that was in effect for
a minimum of 180 consecutive days under one or more group health
benefit plans, if the terminated coverage was in a plan issued or
established in a state other than Oregon;
(b) An eligible individual, as defined in ORS 743.760, who has
left coverage under a group health benefit plan or a portability
health benefit plan and whose carrier cannot offer a portability
plan under ORS 743.760 { - (6) - } { + (5) + } because of:
(A) A change in residence of the eligible individual within
Oregon;
(B) A change in the geographic area served by the group
carrier; or
(C) The carrier's withdrawal from the group market in Oregon in
accordance with ORS 743.737 and 743.754;
(c) An individual who has left coverage that was in effect for
an uninterrupted period of 180 days or more under one or more
Oregon group health benefit plans and the terminated coverage was
provided by:
(A) An employee welfare benefit plan that is exempt from state
regulation under the federal Employee Retirement Income Security
Act of 1974, as amended;
(B) A multiple employer welfare arrangement subject to ORS
750.301 to 750.341; or
(C) A public body of this state in accordance with ORS 731.036;
and
(d) On or after January 1, 1998, an individual who meets the
eligibility requirements of 42 U.S.C. 300gg-41, as amended and in
effect on January 1, 1998, and does not otherwise qualify to
obtain portability coverage from an Oregon group carrier in
accordance with ORS 743.760.
(3) Eligibility for coverage pursuant to subsections (1) and
(2) of this section is subject to the following provisions:
(a) An eligible individual does not include:
(A) 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;
(B) An individual who is covered under another health benefit
plan at the time that portability coverage would commence;
(C) An individual who is eligible to enroll in another health
benefit plan offered by the employer, other than as a late
enrollee, at the time that portability coverage would commence;
or
(D) An individual who is eligible for the federal Medicare
program.
(b) If an eligible individual has left group coverage issued by
an insurance company, a health care service contractor or a
health maintenance organization, the date of first eligibility is
the day following the termination date of the group coverage,
including any period of continuation coverage that was elected by
the individual under federal law or under ORS 743.600 or 743.610.
(c) If an eligible individual has left group coverage issued by
an entity other than an insurance company, a health care service
contractor or a health maintenance organization, the date of
first eligibility is the day following the termination date of
the group coverage, including the full extent of continuation
coverage available to the individual under federal law and ORS
743.600 and 743.610.
(d) If an individual is eligible for coverage pursuant to
subsection (2)(b) of this section, the date of first eligibility
is the day following the loss of the group or portability
coverage.
(4) Coverage under the Oregon Medical Insurance Pool pursuant
to subsections (1) and (2) of this section shall be offered
according to the following provisions:
(a) Coverage is subject to ORS 743.760 (2) and { - (8) - }
{ + (7) + };
(b) Coverage may not be subject to a preexisting conditions
provision, exclusion period, waiting period, residency period or
other similar limitation on coverage; and
(c) The individual shall be required to pay a premium rate not
more than the applicable portability risk rate determined by the
Oregon Medical Insurance Pool Board pursuant to ORS 735.625.
SECTION 22. ORS 743.748 is amended to read:
743.748. (1) Each carrier offering a health benefit plan shall
submit to the Director of the Department of Consumer and Business
Services on or before April 1 of each year a report that
contains:
(a) The following information for the preceding year that is
derived from the exhibit of premiums, enrollment and utilization
included in the carrier's annual report:
(A) The total number of members;
(B) The total amount of premiums;
(C) The total amount of costs for claims;
(D) The medical loss ratio;
(E) The average amount of premiums per member per month; and
(F) The percentage change in the average premium per member per
month, measured from the previous year.
(b) The following aggregate financial information for the
preceding year that is derived from the carrier's annual report:
(A) The total amount of general administrative expenses,
including identification of the five largest nonmedical
administrative expenses and the assessment against the carrier
for the Oregon Medical Insurance Pool;
(B) The total amount of the surplus maintained;
(C) The total amount of the reserves maintained for unpaid
claims;
(D) The total net underwriting gain or loss; and
(E) The carrier's net income after taxes.
(c) The retention rate and claims experience of employer groups
within the plan for the preceding year for association health
plans as described in ORS 743.734 (7). This information is not
subject to public disclosure under ORS chapter 192.
(2) A carrier shall electronically submit the information
described in subsection (1) of this section in a format and
according to instructions prescribed by the Department of
Consumer and Business Services by rule { - after obtaining a
recommendation from the Health Insurance Reform Advisory
Committee - } .
(3) The { - advisory committee - } { + director + } shall
evaluate the reporting requirements under subsection (1)(a) of
this section by the following market segments:
(a) Individual health benefit plans;
(b) Health benefit plans for small employers;
(c) Health benefit plans for employers described in ORS
743.733;
(d) Health benefit plans for employers with more than 50
employees; and
(e) Association health plans described in ORS 743.734 (7).
(4) The department shall make the information reported under
this section available to the public through a searchable public
website on the Internet.
SECTION 23. ORS 743.748, as amended by section 10, chapter 752,
Oregon Laws 2007, is amended to read:
743.748. (1) Each carrier offering a health benefit plan shall
submit to the Director of the Department of Consumer and Business
Services on or before April 1 of each year a report that
contains:
(a) The following information for the preceding year that is
derived from the exhibit of premiums, enrollment and utilization
included in the carrier's annual report:
(A) The total number of members;
(B) The total amount of premiums;
(C) The total amount of costs for claims;
(D) The medical loss ratio;
(E) The average amount of premiums per member per month; and
(F) The percentage change in the average premium per member per
month, measured from the previous year.
(b) The following aggregate financial information for the
preceding year that is derived from the carrier's annual report:
(A) The total amount of general administrative expenses,
including identification of the five largest nonmedical
administrative expenses and the assessment against the carrier
for the Oregon Medical Insurance Pool;
(B) The total amount of the surplus maintained;
(C) The total amount of the reserves maintained for unpaid
claims;
(D) The total net underwriting gain or loss; and
(E) The carrier's net income after taxes.
(2) A carrier shall electronically submit the information
described in subsection (1) of this section in a format and
according to instructions prescribed by the Department of
Consumer and Business Services by rule { - after obtaining a
recommendation from the Health Insurance Reform Advisory
Committee - } .
(3) The { - advisory committee - } { + director + } shall
evaluate the reporting requirements under subsection (1)(a) of
this section by the following market segments:
(a) Individual health benefit plans;
(b) Health benefit plans for small employers;
(c) Health benefit plans for employers described in ORS
743.733; and
(d) Health benefit plans for employers with more than 50
employees.
(4) The department shall make the information reported under
this section available to the public through a searchable public
website on the Internet.
SECTION 24. ORS 743.878 is amended to read:
743.878. { - (1) - } An insurer offering a health benefit
plan as defined in ORS 743.730 must submit to the Director of the
Department of Consumer and Business Services:
{ - (a) - } { + (1) + } Upon request by the director, the
methodology used to determine the insurer's allowable charges for
out-of-network procedures and services or, if the insurer uses a
third party to determine the charges, the methodology used by the
third party to determine allowable charges;
{ - (b) - } { + (2) + } For approval, a written explanation
of the method used by the insurer to determine the allowable
charge, that is in plain language and that must be provided upon
request to enrollees directly, or, in the case of group coverage,
to the employer or other policyholder for distribution to
enrollees; and
{ - (c) - } { + (3) + } Information prescribed by the
director as necessary to assess the effect of the disclosure
requirements in ORS 743.874 and 743.876 on the individual and
group health insurance markets.
{ - (2) The director shall consider the recommendations of
the Health Insurance Reform Advisory Committee in prescribing the
information required for submission under subsection (1)(c) of
this section. - }
SECTION 25. { + Sections 2, 3 and 4 of this 2011 Act and the
amendments to ORS 413.032, 735.616, 742,005, 743.730, 743.733,
743.734, 743.736, 743.737, 743.745, 743.748, 743.751, 743.752,
743.754, 743.760, 743.766 and 743.878 and sections 3 and 4,
chapter 75, Oregon Laws 2010, by sections 5 to 24 of this 2011
Act become operative on January 2, 2014. + }
SECTION 26. { + The Director of the Department of Consumer and
Business Services may take any action before the operative date
specified in section 25 of this 2011 Act that is necessary to
enable the director to exercise, on and after the operative date
specified in section 25 of this 2011 Act, all of the duties,
functions and powers conferred on the director by this 2011
Act. + }
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