HP0921, LD 1260, item 1, An Act Regarding Short-term, Limited-duration Health Plans

An Act Regarding Short-term, Limited-duration Health Plans

Be it enacted by the People of the State of Maine as follows:

Sec. 1. 24-A MRSA §2736-C, sub-§1, ¶C, as amended by PL 2011, c. 238, Pt. D, §1, is further amended to read:

C. "Individual health plan" means any hospital and medical expense-incurred policy or health, hospital or medical service corporation plan contract. It includes both individual contracts and certificates issued under group contracts specified in section 2701, subsection 2, paragraph C. "Individual health plan" does not include the following types of insurance:

(1) Accident;

(2) Credit;

(3) Disability;

(4) Long-term care or nursing home care;

(5) Medicare supplement;

(6) Specified disease;

(7) Dental or vision;

(8) Coverage issued as a supplement to liability insurance;

(9) Workers' compensation;

(10) Automobile medical payment;

(11) Insurance under which benefits are payable with or without regard to fault and that is required statutorily to be contained in any liability insurance policy or equivalent self-insurance; or

(12) Short-term , limited-duration policies, as described in section 2849-B, subsection 1.

Sec. 2. 24-A MRSA §2849-B, sub-§1, as amended by PL 2011, c. 90, Pt. G, §1, is further amended to read:

1. Policies subject to this section. This section applies to all individual, group and blanket medical insurance policies except hospital indemnity, specified accident, specified disease, long-term care and short-term , limited-duration policies issued by insurers or health maintenance organizations. For purposes of this section, a short-term , limited-duration policy is an individual, nonrenewable policy issued for a term that is less than 12 3 months or less. This section does not apply to Medicare supplement policies as defined in section 5001, subsection 4.

Sec. 3. 24-A MRSA §2849-B, sub-§2, as amended by PL 2007, c. 199, Pt. D, §4, is further amended to read:

2. Persons provided continuity of coverage. Except as provided in subsection 3, this section provides continuity of coverage for a person who seeks coverage under an individual, group or blanket insurance policy or health maintenance organization policy if:

A. That person was covered under an individual, group or blanket contract or policy issued by a nonprofit hospital or medical service organization, insurer, health maintenance organization or was covered under an uninsured employee benefit plan that provides payment for health services received by employees and their dependents or a governmental program, including, but not limited to, those listed in section 2848, subsection 1-B, paragraph A, subparagraphs (3) to (10). For purposes of this section, the individual, group or blanket policy under which the person is seeking coverage is the "succeeding policy." The group, blanket or individual contract or policy, uninsured employee benefit plan or governmental program that previously covered the person is the "prior contract or policy"; and

B. Coverage under the prior contract or policy terminated:

(1) Within 180 days before the date the person enrolls or is eligible to enroll in the succeeding contract if:

(a) Coverage was terminated due to unemployment, as defined in Title 26, section 1043;

(b) The person was eligible for and received unemployment compensation benefits for the period of unemployment, as provided under Title 26, chapter 13; and

(2) Within 90 days before the date the person enrolls or is eligible to enroll in the succeeding contract.

A period of ineligibility for a health plan imposed by terms of employment may not be considered in determining whether the coverage ended within a time period specified under this section.

This section does not apply to replacements of group or blanket coverage within the scope of section 2849 or if the succeeding policy is an individual policy and the prior contract or policy was a short-term , limited-duration policy.

Sec. 4. 24-A MRSA §2849-B, sub-§8, as amended by PL 2011, c. 90, Pt. G, §2, is further amended to read:

8. Short-term, limited-duration insurance. A person eligible for continuity of coverage under subsection 2 may be allowed to purchase coverage under an individual, nonrenewable , short-term , limited-duration policy. The issuance of a short-term , limited-duration policy is subject to the following conditions.

A. Upon offering an individual short-term , limited-duration policy for purchase, an insurer or the insurer's agent or broker must provide written disclosure of the terms and benefits of the policy in at least 14-point type. Specific disclosure that the short-term , limited-duration policy is not subject to any limitation on preexisting condition exclusions or the provisions of guaranteed renewal and , continuity of coverage and requirements for minimum essential benefits or other coverage required for qualified health plans under the federal Affordable Care Act is required. Specific disclosure is also required that the policy may not impose any preexisting condition exclusion.

B. An insurer or the insurer's agent or broker may not issue a short-term , limited-duration policy that replaces a prior short-term , limited-duration policy if the combined term of the new policy and all prior successive policies exceed 24 exceeds 3 months in any 12-month period. All individuals making an application for coverage under a short-term , limited-duration policy must disclose any prior coverage under a short-term , limited-duration policy and the policy duration.

C. An insurer may not impose any preexisting condition exclusion on an individual making an application for coverage under a short-term, limited-duration policy and shall apply the same underwriting standards for all applicants.

D. An insurer may not issue a short-term, limited-duration policy without receiving prior approval from the superintendent that the policy and any written disclosures comply with this subsection.

Sec. 5. Application. The requirements of this Act apply to all policies, contracts and certificates executed, delivered, issued for delivery, continued or renewed in this State on or after January 1, 2020. For purposes of this Act, all contracts are deemed to be renewed no later than the next yearly anniversary of the contract date.

summary

This bill limits the issuance of short-term, limited-duration individual health insurance policies in this State to policies with a term that is 3 months or less and further restricts an insurer or the insurer's agent or broker from issuing a short-term, limited-duration policy that replaces a prior short-term, limited-duration policy if the combined term of the new policy and all prior successive policies exceeds 3 months in any 12-month period. The bill prohibits an insurer from imposing any preexisting condition exclusion on a short-term, limited-duration policy.

The bill also requires that insurers make specific written disclosures related to the terms and benefits of policies in at least 14-point type, including the types of benefits and consumer protections that are and are not included in the policies.

The bill prohibits the issuance of a policy without prior approval from the Superintendent of Insurance.

The requirements of the bill apply to policies issued or renewed in this State on or after January 1, 2020.

HP0921 LD 1260	Session - 129th Maine Legislature		LR 2034 Item 1
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