Senate Bill No. 412
(By Senators Tomblin (Mr. President) and Buckalew
By Request of the Executive)
____________
[Introduced March 21, 1997; referred to the Committee
on Banking and Insurance; and then to the Committee on Finance.]
____________
A BILL to repeal section fifteen, article fifteen, chapter
thirty-three of the code of West Virginia, one thousand nine
hundred thirty-one, as amended; to repeal article sixteen-c
of said chapter; to amend and reenact sections two and
twenty, article fifteen of said chapter; to further amend
said article by adding thereto eight new sections designated
sections two-a, two-b, two-c, two-d, two-e, two-f, two-g and
four-e; to amend article sixteen of said chapter by adding
thereto seven new sections, designated sections one-a,
three-j, three-k, three-l, three-m, three-n and seventeen;
to amend and reenact sections three-a and fifteen of said
article; to amend and reenact sections two, four, five,
seven, eight, ten, eleven and twelve, article sixteen-d of
said chapter; to further amend said article by adding thereto one new section, designated section fifteen; to amend and reenact section twenty-four, article twenty-three
of said chapter; to amend and reenact section four, article
twenty-four of said chapter; to amend and reenact section
six, article twenty-five of said chapter; and to amend and
reenact section twenty-four, article twenty-five-a of said
chapter, all relating to the availability and continuity of
health insurance coverage for individuals, small groups and
large groups in accordance with the health insurance
portability and accountability act of 1996, commonly known
as the Kennedy-Kassebaum bill, and related federal mandates;
specifying exceptions under which an insurer may deny
coverage under individual accident and sickness insurance
policies; authority for the commissioner to study
alternatives to guaranteed issue of individual accident and
sickness insurance policies; exceptions under which an
insurer may nonrenew or discontinue individual accident and
sickness insurance coverage; providing for discontinuation
or modification of individual accident and sickness
insurance coverage; limitation of preexisting condition
exclusions; establishment of individual medical savings
accounts; guaranteed renewability of health insurance
coverage; guaranteed issuance of health insurance coverage
for eligible individuals and small groups and related
premium calculation; preexisting health conditions; premium rates; credit for prior coverage; parity of physical and
mental health insurance coverage for large groups; minimum
hospital stays for mothers and newborns; the applicability
of these provisions to entities providing accident and
sickness insurance coverage; and a study of the feasibility
and advisability of extending continuation coverage to
groups of fewer than twenty employees.
Be it enacted by the Legislature of West Virginia:
That section fifteen, article fifteen, chapter thirty-three
of the code of West Virginia, one thousand nine hundred thirty- one, as amended, be repealed; that article sixteen-c of said
chapter be repealed; that sections two and twenty, article
fifteen of said chapter be amended and reenacted; that said
article be further amended by adding thereto seveneight new sections,
designated sections two-a, two-b, two-c, two-d, two-e, two-f,
two-g and four-e; that sections three-a and fifteen, article sixteen of said chapter be amended and reenacted; that said article be further amended by adding thereto seven new sections, designated sections one-a, three-j, three-k, three-l, three-m, three-n and seventeenarticle sixteen of said chapter be amended
by adding thereto seven new sections, designated sections one-a,
three-j, three-k, three-l, three-m,, three-n and seventeen; that
sections three-a and fifteen of said article be amended and
reenacted; that sections two, four, five, seven, eight, ten,
eleven and twelve, article sixteen-d of said chapter be amended
and reenacted; that said article be further amended by adding
thereto one new section, designated section fifteen; that section
twenty-four, article twenty-three of said chapter be amended and reenacted; that section four, article twenty-four of said chapter
be amended and reenacted; that section six, article twenty-five
of said chapter be amended and reenacted; and that section
twenty-four, article twenty-five-a of said chapter be amended and
reenacted, all to read as follows:
ARTICLE 15. ACCIDENT AND SICKNESS INSURANCE.
§33-15-2. Scope and format of policy.
No policy of accident and sickness insurance shall be
delivered or issued for delivery to any person in this state
unless:
(a) The entire money and other considerations therefor are
expressed therein; and
(b) The time at which the insurance takes effect and
terminates is expressed therein; and
(c) It purports to insure only one person, except that a
policy may insure, originally or by subsequent amendment upon the
application of an adult member of a family who shall be deemed
the policyholder, any two or more eligible members of that
family, including husband, wife, dependent children or any
children under a specified age which shall not exceed nineteen
years and any other person dependent upon the policyholder; and
(d) The policy is guaranteed to be renewable
by at the
option of the insured
unless there is fraud, nonpayment of
premium, or material misrepresentation by the insured in the application for insurance and the misrepresentation has been
acted upon by the insurer within two years from the date of the
issuance of the policy except as provided in section two-d of
this article; Notwithstanding the foregoing an insurer may
request the commissioner to terminate coverage. If the
commissioner does not approve a request for termination of
coverage, then the insurer may terminate the coverage but shall
be prohibited from writing new business on coverage of the type
terminated in this state for a period of five years from the date
of notice to the commissioner. The insurer shall provide notice
to all affected policyholders and the commissioner at least one
hundred twenty days prior to renewal. In the event of
nonrenewal, the commissioner and the insurer shall assist
policyholders regardless of geographic area, in finding
appropriate coverage without imposition of preexisting coverage
or benefit restrictions, if already satisfied, of the form and
(e) The style, arrangement and over-all appearance of the
policy give no undue prominence to any portion of the text, and
unless every printed portion of the text of the policy and of any
endorsements or attached papers is plainly printed in light-faced
type of a style in general use, the size of which shall be
uniform and not less than ten-point with a lowercase unspaced
alphabet length not less than one hundred and twenty-point (the
"text" shall include all printed matter except the name and address of the insurer, name or title of the policy, the brief
description, if any, and captions and subcaptions), the policy
shall clearly indicate on the first page the conditions of
renewability; and
(f) The exceptions and reductions of indemnity are set forth
in the policy and, except those which are set forth in sections
four and five of this article, are printed, at the insurer's
option, either included with the benefit provisions to which they
apply, or under an appropriate caption such as "Exceptions," or
"Exceptions and Reductions":
Provided, That if an exception or
reduction specifically applies only to a particular benefit of
the policy, a statement of such exception or reduction shall be
included with the benefit provision to which it applies; and
(g) Each such form, including riders and endorsements, shall
be identified by a form number in the lower left-hand corner of
the first part thereof; and
(h) It contains no provision purporting to make any portion
of the charter, rules, constitution, or bylaws of the insurer a
part of the policy unless such portion is set forth in full in
the policy, except in the case of the incorporation of, or
reference to, a statement of rates or classification of risks, or
short-rate table filed with the commissioner;
and
(i) Effective the first day of July, one thousand nine
hundred ninety-seven, the insurer offers and accepts for enrollment pursuant to section two-b of this article every
eligible individual who applies for coverage within sixty-three
days after termination of the individual's prior creditable
coverage.
§33-15-2a. Definitions.
For purposes of this section and sections two-b, two-c,
two-d, two-e, two-f, two-g and four-e:
(a) "Accident and sickness insurance coverage" means
benefits consisting of medical care (provided directly, through
insurance or reimbursement, or otherwise and including items and
services paid for as medical care) under any hospital or medical
service policy of certificate, hospital or medical service plan
contract, or health maintenance organization contract offered by
an insurer, but does not include short-term limited duration
insurance.
(b) "Bona fide association" means an association which has
been actively in existence for at least five years; has been
formed and maintained in good faith for purposes other than
obtaining insurance; does not condition membership in the
association on any health status-related factor relating to an
individual; makes accident and sickness insurance coverage
offered through the association available to all members
regardless of any health status-related factor relating to the
members or individuals eligible for coverage through a member; does not make accident and sickness insurance coverage offered
through the association available other than in connection with
a member of the association; and meets any additional
requirements as may be set forth in this chapter or by rule.
(c) "COBRA continuation provision" means any of the
following:
(1) Section 4980B of the Internal Revenue Code of 1986,
other than subsection (f)(1) of such section insofar as it
relates to pediatric vaccines;
(2) Part 6 of subtitle B of title I of the Employee
Retirement Income Security Act of 1974, other than section 609 of
such Act; or
(3) Title XXII of the Public Health Service Act.
(d) "Creditable coverage" means, with respect to an
individual, coverage of the individual under any of the
following:
(1) A group health plan;
(2) Accident and sickness insurance coverage;
(3) Part A or part B of title XVIII of the Social Security
Act;
(4) Title XIX of the Social Security Act, other than
coverage consisting solely of benefits under section 1928;
(5) Chapter 55 of title 10 of the United States Code;
(6) A medical care program of the Indian Health Service or of a tribal organization;
(7) A state health benefits risk pool;
(8) A health plan offered under chapter 89 of title 5 of the
United States Code;
(9) A public health plan (as defined in federal
regulations); or
(10) A health benefit plan under section 5(e) of the Peace
Corps Act (22 U.S.C. 2504(e)).
The term "creditable coverage" does not include those
benefits set forth in section two-g of this article.
(e) "Eligible individual" means an individual:
(1) For whom, as of the date on which the individual seeks
coverage, the aggregate period of creditable coverage is eighteen
months or more and whose most recent prior creditable coverage
was under a group health plan, governmental plan (as defined in
section 3(32) of the Employee Retirement Income Security Act of
1974), church plan (as defined in section 3(33) of the Employee
Retirement Income Security Act of 1974), or accident and sickness
insurance coverage offered in connection with any such plan;
(2) Who is not eligible for coverage under a group health
plan, part A or part B of title XVIII of the Social Security Act,
or state plan under title XIX of such Act (or any successor
program), and does not have other accident and sickness insurance
coverage;
(3) With respect to whom the most recent prior creditable
coverage was not terminated as a result of fraud, intentional
misrepresentation of material fact under the terms of the
coverage, or nonpayment of premium;
(4) Who did not turn down an offer of continuation of
coverage under a COBRA continuation provision or under a similar
state program if it was offered; and
(5) Who, if the individual elected such continuation
coverage, has exhausted that coverage under the COBRA
continuation provision or similar state program.
(f) "Group health plan" means an employee welfare benefit
plan (as defined in section 3(1) of the Employee Retirement
Income Security Act of 1974) to the extent that the plan provides
medical care to employees and their dependents (as defined under
the terms of the plan) directly or through insurance,
reimbursement or otherwise.
(g) "Health status-related factor" means an individual's
health status, medical condition (including both physical and
mental illnesses), claims experience, receipt of health care,
medical history, genetic information, and evidence of
insurability (including conditions arising out of acts of
domestic violence) or disability.
(h) "Higher-level coverage" means a policy form for which
the actuarial value of the benefits under the coverage is at least fifteen percent greater than the actuarial value of lower- level coverage offered by the insurer in this state, and the
actuarial value of the benefits under the coverage is at least
one hundred percent but not greater than one hundred twenty
percent of a weighted average.
(i) "Individual market" means the market for accident and
sickness insurance coverage offered to individuals other than in
connection with a group health plan.
(j) "Insurer" means an entity licensed by the commissioner
to transact accident and sickness insurance in this state and
subject to this chapter, but does not include a group health plan
or short term limited duration insurance.
(k) "Lower-level coverage" means a policy form for which the
actuarial value of the benefits under the coverage is at least
eighty-five percent but not greater than one hundred percent of
a weighted average.
(
l) "Medical care" means amounts paid for, or paid for
insurance covering, the diagnosis, cure, mitigation, treatment or
prevention of disease, or amounts paid for the purpose of
affecting any structure or function of the body, including the
amounts paid for transportation primarily for and essential to
such care.
(m) "Network plan" means accident and sickness insurance
coverage of an insurer under which the financing and delivery of medical care (including items and services paid for as medical
care) are provided, in whole or in part, through a definite set
of providers under contract with the insurer.
(n) "Preexisting condition exclusion" means a limitation or
exclusion of benefits relating to a condition based on the fact
that the condition was present before the date of enrollment for
coverage, whether or not any medical advice, diagnosis, care or
treatment was recommended or received before such date.
(o) "Weighted average" means the average actuarial value of
the benefits provided by all the accident and sickness insurance
coverage issued (as elected by the insurer) either by that
insurer or by all insurers in this state in the individual
accident and sickness market during the previous year (not
including coverage issued under this section), weighted by
enrollment for the different coverage.
§33-15-2b. Guaranteed issue; limitation of coverage; election; denial of coverage; network plans.
(a) Each insurer that offers accident and sickness insurance
coverage in the individual market in this state may not, with
respect to an eligible individual desiring to enroll in
individual accident and sickness insurance coverage:
(1) Decline to offer coverage to, or deny enrollment of, an
eligible individual; or
(2) Impose any preexisting condition exclusion with respect to such coverage.
(b) An insurer may elect to limit the coverage offered under
subsection (a) of this section so long as:
(1) The insurer offers at least two different accident and
sickness insurance policy forms, both of which are designed for,
made generally available to, and actively marketed to, and enroll
both eligible and other individuals; and
(2) As elected by the insurer:
(A) The insurer offers the policy forms for individual
accident and sickness insurance coverage with the largest, and
next to the largest, premium volume of all such policy forms
offered by the insurer in this state in the period involved; or
(B) The insurer offers a lower-level coverage policy form
and a higher-level coverage policy form each of which includes
benefits substantially similar to other individual accident and
sickness insurance coverage offered by the insurer in this state
and each of which is covered under a risk adjustment, risk
spreading, or financial subsidization method. The actuarial
value of benefits under a lower-level coverage policy form and a
higher-level coverage policy form shall be calculated based on a
standardized population and a set of standardized utilization and
cost factors.
(c) The elections made by the insurer under subsection (b)
of this section shall apply uniformly to all eligible individuals in this state for that insurer, and shall be effective for
policies offered during a period of at least two years. Policy
forms which have different riders or different cost-sharing
arrangements shall be considered to be different policy forms.
(d) An insurer may deny accident and sickness coverage in
the individual market to an eligible individual if the insurer
has demonstrated to the satisfaction of the commissioner that:
(1) It does not have the financial reserves necessary to
underwrite additional coverage; and
(2) Coverage is denied uniformly to all individuals in the
individual market in the state without regard to any health
status-related factor of the individuals and without regard to
whether the individuals are eligible individuals.
(e) An insurer denying insurance coverage pursuant to the
provisions of subsection (d) of this section may not offer
accident and sickness coverage in the individual market for a
period of one hundred eighty days after the date coverage is
denied or until the insurer has demonstrated to the satisfaction
of the commissioner that it has sufficient financial reserves to
underwrite additional coverage, whichever is later.
(f) Insurers offering accident and sickness insurance
coverage in the individual market through a network plan may:
(1) Limit the individuals who may be enrolled to those who
live, reside or work within the service area for the network plan; and
(2) Deny coverage to those individuals within the service
area if the insurer has demonstrated to the satisfaction of the
commissioner that:
(A) It will not have the capacity to deliver services
adequately to additional individual enrollees because of its
obligations to existing group contract holders and enrollees and
individual enrollees; and
(B) It is applying this subsection uniformly to individuals
without regard to any health status-related factor of the
individuals and without regard to whether the individuals are
eligible individuals.
(g) An insurer denying accident and sickness insurance
coverage through a network plan pursuant to the provisions of
subsection (f) of this section may not offer coverage in the
individual market within its service area for a period of one
hundred eighty days after coverage is denied.
(h) The provisions of this section shall not be construed to
require that an insurer offering accident and sickness coverage
only in connection with group health plans or through one or more
bona fide associations, or both, offer such accident and sickness
insurance coverage in the individual market.
(i) An insurer offering accident and sickness insurance
coverage in connection with group health plans shall not be deemed to be an insurer offering individual accident and sickness
insurance coverage in the individual market solely because such
insurer offers a conversion policy.
(j) The requirements of section one-b of this article do not
apply to policies issued pursuant to this section. However,
premium rate charges for individual accident and sickness
policies issued pursuant to this section shall be filed with and
approved by the commissioner pursuant to the provisions of
article sixteen-b of this chapter.
(k) This section applies to individual accident and sickness
insurance coverage offered, sold, issued, renewed or in effect
after the thirtieth day of June, one thousand nine hundred
ninety-seven.
§33-15-2c. Feasibility study for alternatives to guaranteed
issue.
The Legislature finds that alternatives to the provisions of
this article relating to guaranteed issue of individual accident
and sickness insurance policies do exist but the feasibility of
these alternatives are not presently known. Therefore, the
commissioner is to perform or have performed a study as to the
feasibility of these alternatives and their impact upon the
individual market. The results of this study shall be provided
to the Legislature during its regular session in the year one
thousand nine hundred ninety-eight.
§33-15-2d. Exceptions to guaranteed renewability.
(a) An insurer may nonrenew or discontinue accident and
sickness insurance coverage of an individual in the individual
market based only on one or more of the following:
(1) The individual has failed to pay premiums or
contributions in accordance with the terms of the policy or the
insurer has not received timely premium payments;
(2) The individual has performed an act or practice that
constitutes fraud or made an intentional misrepresentation of
material fact under the terms of coverage;
(3) The insurer is ceasing to offer coverage in accordance
with the provisions of section two-e of this article;
(4) In the case of an insurer that offers coverage through
a network plan, the individual no longer resides, lives or works
in the service area but only if coverage is terminated uniformly
without regard to any health status-related factor of covered
individuals; or
(5) In the case of coverage made available in the individual
market only through one or more bona fide associations, the
individual's membership in the association ceases but only if
coverage is terminated uniformly without regard to any health- status related factor of covered individuals.
(b) This section applies to individual accident and sickness
insurance coverage offered, sold, issued, renewed or in effect after the thirtieth day of June, one thousand nine hundred
ninety-seven.
§33-15-2e. Discontinuation of particular type of coverage;
uniform termination of all coverage; uniform modification of coverage.
(a) An insurer may discontinue offering a particular type of
accident and sickness insurance coverage in the individual market
only if:
(1) The insurer provides written notice to each individual
provided this type of coverage at least ninety days prior to the
date of the discontinuation of coverage;
(2) The insurer offers to each individual in the individual
market provided this type of coverage the option to purchase any
other type of individual accident and sickness insurance policy
currently offered by that insurer; and
(3) The insurer acts uniformly without regard to any health
status-related factor of enrolled individuals or individuals who
may become eligible for coverage.
(b) An insurer may discontinue offering all individual
accident and sickness insurance coverage in the individual market
offered in this state only if:
(1) The insurer provides written notice to the insurance
commissioner and to each insured of the discontinuation at least
one hundred eighty days prior to the expiration of coverage; and
(2) All accident and sickness insurance policies issued or
delivered for issuance in this state in the individual market are
discontinued and coverage under the policies in the individual
market is not renewed.
(c) In the case of discontinuation under subsection (b) of
this section, the insurer may not provide for the issuance of any
accident sickness insurance coverage in the individual market and
state during the five-year period beginning on the date of the
discontinuation of the last accident and sickness insurance
coverage not so renewed.
(d) At the time of renewal, an insurer may modify coverage
under an accident and sickness policy only if the modification is
consistent with the provisions of this article and effective on
a uniform basis among all individuals with that policy form.
(e) This section applies to individual accident and sickness
insurance coverage offered, sold, issued, renewed or in effect
after the thirtieth day of June, one thousand nine hundred
ninety-seven.
§33-15-2f. Certification of creditable coverage.
An insurer offering accident and sickness insurance coverage
pursuant to the provisions of this article shall provide
certification of creditable coverage in the same manner as
provided in section three-m, article sixteen of this chapter.
§33-15-2g. Applicability.
(a) The requirements of sections two-b, two-d, two-e and
two-f of this article do not apply to:
(1) Coverage only for accident, or disability income
insurance or any combination thereof;
(2) Coverage issued as a supplement to liability insurance;
(3) Liability insurance, including general liability
insurance and automobile liability insurance;
(4) Workers' compensation or similar insurance;
(5) Automobile medical payment insurance;
(6) Credit-only insurance;
(7) Coverage for on-site medical clinics; and
(8) Other similar insurance coverage, which may be specified
by rule, under which benefits for medical care are secondary or
incidental to other insurance benefits.
(b) The requirements of sections two-b, two-d, two-e and
two-f of this article do not apply to the following if provided
under a separate policy, certificate, or contract of insurance:
(1) Limited scope dental or vision benefits;
(2) Benefits for long-term care, nursing home care, home
health care, community-based care, or any combination thereof;
(3) Coverage for only a specified disease or illness;
(4) Hospital indemnity or other fixed indemnity insurance;
(5) Medicare supplement insurance (as defined under section
1882(g)(1) of the Social Security Act), coverage supplemental to the coverage provided under chapter 55 of title 10, United States
Code, and similar supplemental coverage provided to coverage
under group accident and sickness insurance; and
(6) Any other benefits as may be specified by rule.
§33-15-4e. Benefits for mothers and newborns.
(a) Nothing in this section shall be construed to require a
mother to give birth in a hospital or to stay in a hospital for
a fixed period of time following the birth of her child.
However, an insurer offering accident and sickness insurance
coverage under this article may not restrict benefits for any
hospital length of stay in connection with childbirth for the
mother or her newborn child to less than forty-eight hours
following a normal vaginal delivery, or to less than ninety-six
hours following a cesarean section, or require a provider to
obtain authorization for such length hospital stays. The mother
and her newborn child may be discharged prior to the expiration
of the minimum length of stay required under this section only in
those cases in which the decision to discharge is made by an
attending provider in consultation with the mother.
(b) Coverage for maternity and pediatric care shall be
provided in accordance with guidelines established by the
American College of Obstetricians and Gynecologists, the American
Academy of Pediatrics, or other established professional medical
associations.
(c) Benefits provided under this section may be subject to
deductibles, coinsurance, or other cost-sharing in relation to
benefits for hospital stays in connection with childbirth for a
mother or newborn child if the coinsurance or other cost-sharing
for any portion of the hospital stay required under subsection
(a) of this section is no greater than the coinsurance or cost- sharing for any preceding portion of the stay.
(d) Nothing in this section may be construed to prevent an
insurer from negotiating the level and type of reimbursement with
a provider for the care provided a mother or newborn child in
connection with childbirth.
(e) This section shall not apply with respect to any
accident and sickness insurance coverage which does not provide
benefits for hospital lengths of stay in connection with
childbirth for a mother or her newborn child.
(f) This section shall apply to accident and sickness
insurance coverage offered, sold, issued, renewed, or in effect
in the individual market on or after the first day of January,
one thousand nine hundred ninety-eight.
§33-15-20. Individual medical savings accounts; definitions;
ownership; trustees; regulations.
(a) Any individual resident of this state may establish
a
an individual medical savings account to serve as self-insurance
for the payment of medical expenses:
As used in this section "individual medical savings account" means a trust for the
payment of medical expenses created or organized for the
exclusive benefit of an individual, his or her children and
dependents, and his or her beneficiaries Provided, That an
individual establishing
a an individual medical savings account
may designate a percentage of the account
assets that may be
withdrawn by the individual if not needed for
the payment of
medical expenses:
of the individual, his or her children or
other dependents and his or her beneficiaries Provided, however,
That any amount remaining in
a an individual medical savings
account on the earlier of the date of retirement, at the age of
fifty-nine and one-half years or more, of the individual who
established the account, or the date of death of that individual,
may be withdrawn by the individual or by his or her personal
representative for a purpose other than the payment of medical
expenses:
Provided further, That any withdrawal for a purpose
other than to pay medical expenses as provided in this section
shall be added to the federal adjusted gross income of the payee
or distributee for purposes of calculating West Virginia adjusted
gross income And Provided further, That no withdrawal pursuant
to this subsection shall be subject to the additional twenty
percent tax as provided in subsection (d) of this section.
As
used in this section, "individual medical savings account" means
a trust that meets the definition of "medical savings account" set forth in paragraph (1), subsection (d), section 220 of the
Internal Revenue Code of 1986, as amended, when that definition
is applied without regard to sub-subparagraph (ii), subparagraph
(A) of that paragraph. "Medical expenses" means expenses that
fall within the definition of "qualified medical expenses" set
forth in paragraph (2), subsection (d), section 220 of the
Internal Revenue Code of 1986, as amended, when that definition
is applied without regard to subparagraph (C) of that paragraph.
"Medical expenses" means amounts paid for services for the
diagnosis, cure, mitigation, treatment, or prevention of disease,
or for the purpose of affecting any structure or function of the
body, which expenses may be included in calculating the federal
deduction for medical and dental expenses for federal income tax
purposes; for insurance premiums for combined plans issued
pursuant to this section; but excluding expenses for cosmetic
surgery as defined in Section 213 of the Internal Revenue Code of
1986, as amended. Funds in an individual medical savings account
may not be used for payment of medical expenses which any
third-party payor is obligated to pay, except for expenses of a
medicaid-eligible individual covered under the state's medicaid
program. The interest of an individual in a medical savings
account established for his or her benefit pursuant to this
section shall be nonforfeitable.
(b) The trustee for an individual medical savings account shall be a bank or other entity qualified as a trustee of
individual retirement accounts under Section 408 of the Internal
Revenue Code of 1986, as amended. An insurer qualified under the
Internal Revenue Code of 1986, as amended, may act as trustee.
The assets of the trust shall not be commingled with other
property except in a common trust fund or common investment fund.
A trustee who is an insurer may hold the assets of individuals
insured under individual accident and sickness plans in a common
fund for the account of all individuals who have an interest in
the trust, if there is a separate accounting for the interest of
each individual or member.
(c) (b) Any insurer issuing accident and sickness policies
in this state in accordance with the provisions of this article
may offer a benefit plan including deductibles or copayments
combined with individual self-insurance through the establishment
of individual medical savings accounts. A benefit plan
established pursuant to this subsection shall provide that
medical expenses included within deductible or copayment
provisions of the accident and sickness policy for the individual
or for his or her covered dependents and therefore not payable
under that policy be paid by the trustee, either directly or as
reimbursement to an individual who has previously paid medical
expenses, from the individual medical savings
investment account.
A benefit plan may limit payment of medical expenses until the group plan annual deductible is met from the
individual medical
savings account to expenses which are covered services under the
policy.
(c) Within one hundred eighty days of the passage of this
legislation, the tax commissioner may promulgate emergency rules
as to the keeping of records, the content and form of returns and
statements, and the filing of copies of income tax returns and
determination by trustees of individual medical savings accounts
and by individuals establishing individual medical savings
accounts: Provided, That for purposes of sections fifteen,
fifteen-a and fifteen-b, article three, chapter twenty-nine-a of
this code, a sufficient emergency to justify the promulgation of
those rules shall be deemed to exist. The power granted by this
subsection shall be in addition to the rule-making powers granted
to the tax commissioner elsewhere in this code.
(d) The insurance commissioner shall promulgate legislative
rules pursuant to article three, chapter twenty-nine-a of this
code to establish specific standards for individual medical
savings accounts and for plans in which a policy of insurance is
combined with self-insurance under an individual medical savings
account. Such standards shall be in addition to and in
accordance with the applicable laws of this state and may cover,
but shall not be limited to:
(1) Definitions of terms;
(2) An annual contribution minimum for individual medical
savings accounts;
(3) An annual contribution maximum for individual medical
savings accounts;
(4) Limitations upon an individual's access to or use of
individual medical savings account funds and circumstances under
which funds in the account may be disbursed: Provided, That if,
during any taxable year, the beneficial owner of an individual
medical savings account borrows any money under or by use of that
account, the account ceases to be an individual medical savings
account as of the first day of that taxable year: Provided,
however, That
(d) If any amount
paid or distributed out of
a an individual
medical savings account
is used for any purpose other than to
defray medical expenses,
as provided in this section shall be
added to the federal adjusted gross income of the payee or
distributee for purposes of calculating West Virginia adjusted
gross income: Provided further, That the payee's or
distributee's tax under this article for the taxable year in
which the amount is received except as specifically provided in
subsection (a) of this section or except for a distribution of
account assets pursuant to order of a federal bankruptcy court,
the West Virginia personal income tax of the individual
establishing the account, for the taxable year in which the distribution is made shall be increased by an amount equal to
twenty ten percent of the
portion of the payment or distribution.
that is includible in the payee's or distributee's federal
adjusted gross income;
(5) Circumstances under which a combined benefit plan
offered through an insurer may permit reduced contributions to
the individual medical savings account, which circumstances may
include the accruing of a specified account balance;
(6) Provisions relating to reporting payments for the
benefit of an individual from an individual medical savings
account for medical expenses to an insurer offering a combined
benefit plan; and
(7) Provisions relating to change or redesignation of a
trustee.
(e) The tax commissioner is authorized to establish
penalties for early or unauthorized withdrawals from individual
medical savings accounts pursuant to rules promulgated pursuant
to article three, chapter twenty-nine-a of this code, which
penalties may not exceed federal penalties for early or
unauthorized withdrawals from individual retirement accounts
under the Internal Revenue Code of 1986, as amended.
ARTICLE 16. GROUP ACCIDENT AND SICKNESS INSURANCE.
§33-16-1a. Definitions.
As used in this article:
(a) "Bona fide association" means an association which has
been actively in existence for at least five years; has been
formed and maintained in good faith for purposes other than
obtaining insurance; does not condition membership in the
association on any health status-related factor relating to an
individual; makes accident and sickness insurance offered through
the association available to all members regardless of any health
status-related factor relating to members or individuals eligible
for coverage through a member; does not make accident and
sickness insurance coverage offered through the association
available other than in connection with a member of the
association; and meets any additional requirements as may be set
forth in this chapter or by rule.
(b) "Commissioner" means the commissioner of insurance.
(c) "Creditable coverage" means, with respect to an
individual, coverage of the individual after the thirtieth day of
June, one thousand nine hundred ninety-six, under any of the
following, other than coverage consisting solely of excepted
benefits:
(1) A group health plan;
(2) A health benefit plan;
(3) Medicare Part A or Part B, 42 U.S.C. § 1395 et seq.;
Medicaid, 42 U.S.C. §1396a et seq. (other than coverage
consisting solely of benefits under section 1928 of the Social Security Act); Civilian Health and Medical Program of the
Uniformed Services (CHAMPUS), 10 U.S.C., Chapter 55; and a
medical care program of the Indian Health Service or of a tribal
organization;
(4) A health benefits risk pool sponsored by any state of
the United States or by the District of Columbia; a health plan
offered under 5 U.S.C., chapter 89; a public health plan as
defined in regulations promulgated by the federal secretary of
health and human services; or a health benefit plan as defined in
the Peace Corps Act, 22 U.S.C. § 2504(e).
(d) "Dependent" means an eligible employee's spouse or any
unmarried child or stepchild under the age of eighteen or
unmarried, dependent child or stepchild under age twenty-three if
a full-time student at an accredited school.
(e) "Eligible employee" means an employee, including an
individual who either works or resides in this state, who meets
all requirements for enrollment in a health benefit plan.
(f) "Excepted benefits" means:
(1) Any policy of liability insurance or contract
supplemental thereto; coverage only for accident or disability
income insurance or any combination thereof; automobile medical
payment insurance; credit-only insurance; coverage for on-site
medical clinics; workers' compensation insurance; or other
similar insurance under which benefits for medical care are secondary or incidental to other insurance benefits; or
(2) If offered separately, a policy providing benefits for
long-term care, nursing home care, home health care, community- based care or any combination thereof, dental or vision benefits,
or other similar, limited benefits; or
(3) If offered as independent, noncoordinated benefits under
separate policies or certificates, specified disease or illness
coverage, hospital indemnity or other fixed indemnity insurance,
or coverage, such as medicare supplement insurance, supplemental
to a group health plan; or
(4) A policy of accident and sickness insurance covering a
period of less than one year.
(g) "Group health plan" means an employee welfare benefit
plan, including a church plan or a governmental plan, all as
defined in section three of the Employee Retirement Income
Security Act of 1974, 29 U.S.C. § 1003, to the extent that the
plan provides medical care;
(h) "Health benefit plan" means benefits consisting of
medical care provided directly, through insurance or
reimbursement, or indirectly, including items and services paid
for as medical care, under any hospital or medical expense
incurred policy or certificate; hospital, medical or health
service corporation contract; health maintenance organization
contract; or plan provided by a multiple-employer trust or a multiple-employer welfare arrangement. "Health benefit plan"
does not include excepted benefits.
(i) "Health insurer" means an entity licensed by the
commissioner to transact accident and sickness in this state and
subject to this chapter. "Health insurer" does not include a
group health plan.
(j) "Health status-related factor" means an individual's
health status, medical condition (including both physical and
mental illnesses), claims experience, receipt of health care,
medical history, genetic information, evidence of insurability
(including conditions arising out of acts of domestic violence)
or disability.
(k) "Medical care" means amounts paid for, or paid for
insurance covering, the diagnosis, cure, mitigation, treatment or
prevention of disease, or amounts paid for the purpose of
affecting any structure or function of the body, including
amounts paid for transportation primarily for and essential to
such care.
(
l) "Mental health benefits" means benefits with respect to
mental health services, as defined under the terms of a group
health plan or a health benefit plan offered in connection with
the group health plan.
(m) "Network plan" means a health benefit plan under which
the financing and delivery of medical care are provided, in whole or in part, through a defined set of providers under contact with
the health insurer.
(n) "Preexisting condition exclusion" means, with respect to
a health benefit plan, a limitation or exclusion of benefits
relating to a condition based on the fact that the condition was
present before the enrollment date for such coverage, whether or
not any medical advice, diagnosis, care or treatment was
recommended or received before the enrollment date.
§33-16-3a. Same. -- Mental health.
Any policy described in this article which shall be
delivered or issued or renewed in this state shall make available
as benefits to all individual subscribers and members and to all
group members if so elected by the subscriber or group, for
expenses arising from mental or nervous conditions as hereinafter
set forth. Such benefits shall be as described in the standard
nomenclature of the American psychiatric association which are at
least equal to the following minimum requirements:
(a) In the case of benefits based upon confinement as an
inpatient in a mental hospital under the direction and
supervision of the department of mental health, or in a private
mental hospital licensed by the department of mental health, the
period of confinement for which benefits shall be payable shall
be at least forty-five days in any calendar year.
(b) In the case of benefits based upon confinement as an inpatient in a licensed or accredited general hospital, such
benefits shall be no different than for any other illness.
(c) In the case of outpatient benefits, these shall cover
fifty percent of eligible expenses up to five hundred dollars
over a twelve-month period, services furnished: (1) By a
comprehensive health service organization; (2) by a licensed or
accredited hospital; or (3) subject to the approval of the
department of mental health, services furnished by a community
mental health center or other mental health clinic or day care
center which furnishes mental health services; or (4)
consultations or diagnostic or treatment sessions, provided that
such services are rendered by a psychotherapist or by a
psychologist and do not exceed fifty such sessions over a
twelve-month period.
(d) With respect to mental health benefits furnished before
September 30, 2001, to an enrollee of a health benefit plan
offered in connection with a group health plan, for a plan year
beginning on or after January 1, 1998:
(1) Aggregate lifetime limits:
(A) If the health benefit plan does not include an aggregate
lifetime limit on substantially all medical and surgical
benefits, as defined under the terms of the plan but not
including mental health benefits, the plan may not impose any
aggregate lifetime limit on mental health benefits;
(B) If the health benefit plan limits the total amount that
may be paid with respect to an individual or other coverage unit
for substantially all medical and surgical benefits (in this
paragraph, "applicable lifetime limit"), the plan shall either
apply the applicable lifetime limit to medical and surgical
benefits to which it would otherwise apply and to mental health
benefits, as defined under the terms of the plan, and not
distinguish in the application of the limit between medical and
surgical benefits and mental health benefits, or not include any
aggregate lifetime limit on mental health benefits that is less
than the applicable lifetime limit;
(C) If a health benefit plan not previously described in
this subdivision includes no or different aggregate lifetime
limits on different categories of medical and surgical benefits,
the commissioner shall promulgate rules under which paragraph (B)
of this subdivision shall apply, substituting an average
aggregate lifetime limit for the applicable lifetime limit.
(2) Annual limits:
(A) If a health benefit plan does not include an annual
limit on substantially all medical and surgical benefits, as
defined under the terms of the plan but not including mental
health benefits, the plan may not impose any annual limit on
mental health benefits, as defined under the terms of the plan;
(B) If the health benefit plan limits the total amount that may be paid in a twelve-month period with respect to an
individual or other coverage unit for substantially all medical
and surgical benefits (in this paragraph, "applicable annual
limit"), the plan shall either apply the applicable annual limit
to medical and surgical benefits to which it would otherwise
apply and to mental health benefits, as defined under the terms
of the plan, and not distinguish in the application of the limit
between medical and surgical benefits and mental health benefits,
or not include any annual limit on mental health benefits that is
less than the applicable annual limit;
(C) If a health benefit plan not previously described in
this subdivision includes no or different annual limits on
different categories of medical and surgical benefits, the
commissioner shall promulgate rules under which paragraph (B) of
this subdivision shall apply, substituting an average annual
limit for the applicable annual limit.
(3) For purposes of this subsection, mental health benefits
do not include benefits with respect to treatment of substance
abuse or chemical dependency. This subsection shall not apply to
a health benefit plan if its application results in an increase
of at least one percent in the cost under the plan.
(4) If a group health plan or a health insurer offers a
participant or beneficiary two or more benefit package options,
this subsection shall apply separately with respect to coverage under each option.
§33-16-3j. Hospital benefits for mothers and newborns.
(a) Nothing in this section shall be construed to require a
mother to give birth in a hospital or to stay in the hospital for
a fixed period of time following the birth of her child, but if
a health benefit plan, for plan years beginning on or after the
first day of January, one thousand nine hundred ninety-eight,
provides inpatient benefits in connection with childbirth for a
mother or her newborn child:
(1) The plan may not restrict benefits for any hospital stay
following a normal vaginal delivery to less than forty-eight
hours or following a cesarean section to less than ninety-six
hours, or require a provider to obtain authorization for such
length hospital stays;
(2) The plan must cover maternity and pediatric care in
accordance with guidelines established by the American College of
Obstetricians and Gynecologists, the American Academy of
Pediatrics or other established professional medical association;
and
(3) The mother and her newborn child may be discharged prior
to the expiration of the minimum length of stay required under
this section only in those cases in which the decision to
discharge is made by an attending provider in consultation with
the mother.
(b) Benefits provided for under this section may be made
subject to deductibles, coinsurance or other cost-sharing if such
cost-sharing is no greater than cost-sharing for any preceding
portion of the mother's or newborn child's hospital stay.
(c) Nothing in this section shall be construed to prevent a
health insurer from negotiating with a provider the level and
type of reimbursement for inpatient maternity or newborn care
provided under a health benefit plan.
§33-16-3k. Limitations on preexisting condition exclusions for
health benefit plans.
(a)(1) For plan years beginning after the thirtieth day of
June, one thousand nine hundred ninety-seven, a health benefit
plan issued in connection with a group health plan may not limit
coverage for an employee or a dependent of an employee because of
a preexisting condition for losses incurred more than twelve
months (or eighteen months for a late enrollee) after the earlier
of the individual's date of enrollment in the health benefit plan
or the first day of a waiting period for enrollment in the plan.
Genetic information may not be treated as a preexisting condition
for purposes of this subdivision absent a diagnosis of the
condition related to the genetic information.
(2) A health benefit plan may impose a preexisting condition
exclusion only if such condition relates to a physical or mental
condition, regardless of its cause, for which medical advice, diagnosis, care or treatment was recommended or received within
the six-month period ending on the enrollee's enrollment date.
(3) A health benefit plan may impose no preexisting
condition exclusion relating to pregnancy or in the case of a
newborn covered under creditable coverage within thirty days of
birth or a child adopted before the age of eighteen and covered
under creditable coverage within thirty days of adoption or
placement for adoption.
(b) A health maintenance organization that does not impose
a preexisting condition exclusion allowed under subsection (a) of
this section with respect to any particular coverage option may:
(1) Impose an affiliation period for that coverage option if
the affiliation period is applied uniformly without regard to any
health status-related factors and does not exceed two months
(three months for a late enrollee). For purposes of this
article, "affiliation period" means a period that begins on an
employee's or dependent's enrollment date, runs concurrently with
any waiting period under the group health plan, must expire
before coverage is effective and during which the health
maintenance organization need not provide medical care and may
not charge any premium to the employee or dependent; or
(2) Use other alternatives approved by the commissioner to
address adverse selection.
(c) Any preexisting condition exclusion period, including any waiting period or affiliation period prior to the effective
date of coverage, shall be reduced by the aggregate of the
periods of creditable coverage applicable to the enrollee as of
the enrollment date.
§33-16-3l. Renewability and modification of health benefit
plans.
(a) A health insurer may refuse to renew a health benefit
plan issued in connection with a group health plan after
complying with all applicable provisions of this chapter and only
for one of the following reasons:
(1) The policyholder's failure to pay premiums or the
carrier's failure to receive timely premium payments;
(2) Fraud or intentional misrepresentation of material fact
by the policyholder;
(3) The policyholder's failure to comply with a material
plan provision relating to contribution or group participation
rules;
(4) The health insurer elects to discontinue offering health
benefit plans:
(A) Of a particular type, if the health insurer gives notice
to each policyholder of such plan and to all covered employees or
members and dependents at least ninety days before the date such
coverage is discontinued:
Provided, That a health insurer
electing to discontinue health benefit plans to small employers shall comply with the requirements of section seven, article
sixteen-d of this chapter. The health insurer shall offer each
such policyholder the option to purchase any other health benefit
plan offered by the health insurer to employers. In electing to
discontinue health benefit plans of a particular type and in
offering coverage under the preceding sentence, the health
insurer shall act uniformly without regard to policyholders'
claims experience or any health status-related factor relating to
any covered employee, member or dependent or new employees,
members or dependents who may become eligible for coverage; or
(B) Of all types, if the health insurer gives notice to the
commissioner and to each policyholder and all covered employees
or members and dependents at least one hundred eighty days before
the date plans are discontinued:
Provided, That a health insurer
electing to discontinue health benefit plans to small employers
shall comply with the requirements of section seven, article
sixteen-d of this chapter. The health insurer shall discontinue
all, and not renew any, health benefit plans issued pursuant to
this article. The health insurer may not issue any health
benefit plan pursuant to this article for a five-year period
beginning on the date the last discontinued health benefit plan
is not renewed;
(5) For a health insurer offering coverage under a network
plan, the health insurer no longer has any enrollees of the network plan who live, reside or work in the plan's service area;
or
(6) For health benefit plans offered only through an bona
fide association, an employer ceases to be a member of the bona
fide association, if coverage is terminated uniformly without
respect to any health status-related factor relating to any
covered employee, association member or dependent. With respect
to coverage provided to an employer, a reference to
"policyholder" or "plan sponsor" is deemed to include a reference
to the employer.
(b) Subject to other requirements of this chapter, a health
insurer may modify a health benefit plan issued in connection
with a group health plan when the health benefit plan is renewed.
§33-16-3m. Creditable coverage.
(a)(1) A health insurer shall certify an enrollee's
creditable coverage at the time an enrollee:
(A) Ceases to be covered under a health benefit plan issued
in connection with a group health plan, including coverage under
a COBRA continuation provision. For purposes of this article,
"COBRA continuation provision" means any of the following;
(1) Section 4980B of the Internal Revenue Code of 1986,
other than subsection (f)(1) of such section insofar as it
relates to pediatric vaccines;
(2) Part 6 of subtitle B of title I of the Employee Retirement Income Security Act of 1974, other than section 609 of
such Act; or
(3) Title XXII of the Public Health Service Act;
(B) Ceases to be covered under a COBRA continuation
provision; and
(C) Requests certification, but no later than twenty-four
months after cessation of coverage under the health benefit plan.
(2) The health insurer shall provide the enrollee a written
certification of:
(A) The period of creditable coverage under the health
benefit plan, including coverage, if any, under a COBRA
continuation provision; and
(B) The waiting period, if any, and affiliation period, if
applicable, for any coverage under the health benefit plan.
(b) For purposes of reducing an enrollee's preexisting
condition exclusion period, creditable coverage shall not be
counted if, after such period and before an employee's or
dependent's enrollment in a health benefit plan issued in
connection with a group health plan, there was a period of sixty- three days or more during all of which the individual was not
covered under any creditable coverage. For purposes of this
subsection, a sixty-three-day period may not include any waiting
period or affiliation period prior to the effective date of an
individual's coverage.
(c) For purposes of reducing an enrollee's preexisting
condition exclusion period, a health insurer:
(1) Shall count a period of creditable coverage without
regard to specific benefits covered during the period; or
(2) May elect to apply creditable coverage based upon each
of several classes or categories of benefits in accordance with
rules promulgated by the commissioner. A health insurer shall
make such an election on a uniform basis for all enrollees and
shall count a period of creditable coverage with respect to any
class or category of benefits if any level of benefits is covered
within such class or category.
§33-16-3n. Eligibility for enrollment.
(a) Notwithstanding any provision of any policy, provision,
contract, plan or agreement to which this article applies, a
health insurer offering coverage in connection with a group
health plan may not, for plan years beginning after the thirtieth
day of June, one thousand nine hundred ninety-seven, establish
rules for eligibility, including continued eligibility, of any
employee or dependent to enroll under a health benefit plan based
on a health status-related factor.
(b) For plan years beginning after the thirtieth day of
June, one thousand nine hundred ninety-seven, a health benefit
plan offered in connection with a group health plan shall provide
that an employee or dependent of an employee who is eligible, but not enrolled, under terms of a health benefit plan may enroll
under terms of the plan if the employee or dependent:
(1) Was covered under other creditable coverage when
coverage was previously offered to the employee or dependent and,
if required by the insurer, the employee stated in writing that
the existence of other creditable coverage was the reason for
declining enrollment under the health benefit plan;
(2) Lost coverage under the other creditable coverage
because of legal separation, divorce, death, termination of
employment, reduction in the number of hours of employment,
exhaustion of COBRA continuation coverage or termination of the
employer's contributions towards the other creditable coverage;
and
(3) The employee requests enrollment no more than thirty
days after loss of the other creditable coverage.
(c) For plan years beginning after the thirtieth day of
June, one thousand nine hundred ninety-seven, if a health benefit
plan makes coverage available to an employee's dependents, the
plan shall provide that if an employee is enrolled under the plan
or has met any waiting period requirement and is eligible for
enrollment but for a failure to enroll during a previous
enrollment period:
(1) The employee or a person who becomes a dependent of the
employee through marriage, birth, adoption or placement for adoption may be enrolled under the plan, and in the case of the
birth or adoption of a child, the employee's spouse who is
otherwise eligible for coverage may be enrolled as a dependent,
during a period of at least thirty days beginning on the later of
the date dependent coverage is made available or the date of the
marriage, birth, adoption or placement for adoption; and
(2) If the employee requests enrollment of a dependent
during the first thirty days that dependent coverage is
available, the dependent's coverage shall become effective:
(A) In the case of marriage, no later than the first day of
the first month after the date the completed enrollment request
is received; or
(B) In the case of a dependent's birth, adoption or
placement for adoption, as of the date of birth, adoption or
placement for adoption.
§33-16-15. Individual medical savings accounts; definitions;
ownership; contributions; trustees; regulations.
(a) Any insurer issuing group accident and sickness policies
in this state, the public employees insurance agency and any
employer offering a health benefit plan pursuant to the Employee
Retirement Income Security Act of 1974, as amended, may offer a
benefit plan including deductibles or copayments combined with
employee self-insurance through the establishment of individual
medical savings accounts.
An insurer offering a benefit plan consisting of deductibles or copayments combined with employee
self-insurance and individual medical savings accounts shall not
be deemed to be an insurer offering individual accident and
sickness insurance coverage solely because the insurer offers
such a benefit plan. As used in this section "individual medical
savings account" means a trust for the payment of medical
expenses created or organized for the exclusive benefit of an
individual, his or her dependents covered under a group accident
and sickness policy, and his or her beneficiaries: Provided,
That An employee establishing
a an individual medical savings
account, or for whom
a medical savings an account is established
by an employer, may designate a percentage of the employee's
contributions, if any, to that account that may be withdrawn by
the employee if not needed for
the payment of medical expenses:
of the employee, his or her children or other dependents and his
or her beneficiaries Provided, however, That any amount
remaining in
a an individual medical savings account on the
earlier of the date of retirement, at the age of fifty-nine and
one-half years or more, of the employee or the date of death of
the employee, may be withdrawn by the employee or by his or her
personal representative for a purpose other than the payment of
medical expenses:
Provided further, That any withdrawal for a
purpose other than to pay medical expenses as provided in this
section shall be added to the federal adjusted gross income of the payee or distributee And Provided, further, however, That
no withdrawal pursuant to this subsection shall be subject to the
additional twenty percent tax as provided in subsection (d) of
this section.
As used in this section, "individual medical
savings account" means a trust that meets the definition of
"medical savings account" set forth in paragraph (1), subsection
(d), section 220 of the Internal Revenue Code of 1986, as
amended, when that definition is applied without regard to sub- subparagraph (ii), subparagraph (A) of that paragraph. "Medical
expenses" means expenses that fall within the definition of
"qualified medical expenses" set forth in paragraph (2),
subsection (d), section 220 of the Internal Revenue Code of 1986,
as amended, when that definition is applied without regard to
subparagraph (C) of that paragraph. "Medical expenses" means
amounts paid for services for the diagnosis, cure, mitigation,
treatment, or prevention of disease, or for the purpose of
affecting any structure or function of the body, which expenses
may be included in calculating the federal deduction for medical
and dental expenses for federal income tax purposes; for
insurance premiums for combined plans issued pursuant to this
section; but excluding expenses for cosmetic surgery as defined
in Section 213 of the Internal Revenue Code of 1986, as amended.
Funds in an individual medical savings account may not be used
for payment of medical expenses which any third-party payor is obligated to pay, except for medical expenses of a
medicaid-eligible individual covered under the state's medicaid
program.
(b) A benefit plan established pursuant to this section
shall provide that medical expenses included within deductible or
copayment provisions of the group accident and sickness policy
and therefore not payable under the group policy for the employee
or for his or her covered dependents be paid by the trustee,
either directly or as reimbursement to an employee who has
previously paid medical expenses, from the individual medical
savings account. A benefit plan may limit payment of medical
expenses until the group plan annual deductible is met from the
medical savings account to expenses which are covered services
under the group policy.
Combined plans are subject to the
protections afforded by article twenty-six-a of this chapter.
(b) The interest of an employee in a medical savings account
established for his or her benefit pursuant to this section shall
be nonforfeitable.
(c) The trustee for an individual medical savings account
shall be a bank or other entity qualified as a trustee of
individual retirement accounts under Section 408 of the Internal
Revenue Code of 1986, as amended. An insurer so qualified may
act as trustee. The assets of the trust shall not be commingled
with other property except in a common trust fund or common investment fund. The trustee may hold the assets of employees
insured under a group accident and sickness plan in a common fund
for the account of all individuals who have an interest in the
trust, if there is a separate accounting for the interest of each
employee or member. Combined plans are subject to the
protections afforded by article twenty-six-a of this chapter.
(c) Within one hundred eighty days of the passage of this
legislation, the tax commissioner may promulgate emergency rules
as to the keeping of records, the content and form of returns and
statements, and the filing of copies of income tax returns and
determination by trustees of individual medical savings accounts
and by employees establishing those accounts or for whom those
accounts are established: Provided, That for purposes of
sections fifteen, fifteen-a and fifteen-b, article three, chapter
twenty-nine-a of this code, a sufficient emergency to justify the
promulgation of those rules shall be deemed to exist. The power
granted by this subsection shall be in addition to the rule- making power granted to the tax commissioner elsewhere in this
code.
(d)
The insurance commissioner shall promulgate legislative
rules pursuant to article three, chapter twenty-nine-a of this
code to establish specific standards for plans in which a group
policy is combined with self-insurance under an individual
medical savings account. These standards shall be in addition to and in accordance with the applicable laws of this state and may
cover, but shall not be limited to:
(1) Definitions of terms;
(2) An annual contribution minimum for individual medical
savings accounts;
(3) An annual contribution maximum for individual medical
savings accounts;
(4) Limitations which a plan may impose upon an employee's
access to or use of individual medical savings account funds and
circumstances under which funds in the account may be disbursed:
Provided, That if, during any taxable year, the beneficial owner
of an individual medical savings account borrows any money under
or by use of that account, the account ceases to be an individual
medical savings account as of the first day of that taxable year:
Provided, however, That If any amount
paid or distributed out of
a an individual medical savings account
is used for any purpose
other than to defray medical expenses,
as provided in this
section shall be added to the federal adjusted gross income of
the payee or distributee for purposes of calculating West
Virginia adjusted gross income: Provided further, That the
payee's or distributee's tax under this article for the taxable
year in which the amount is received except as specifically
provided in subsection (a) of this section or except for a
distribution of account assets pursuant to order of a federal bankruptcy court,
the West Virginia personal income tax of the
employee establishing the account or for whom the account is
established, for the taxable year in which the distribution is
made shall be increased by an amount equal to
twenty ten percent
of the
portion of the payment or distribution.
that is
includible in the payee's or distributee's federal adjusted gross
income;
(5) Circumstances under which a plan may permit reduced
contributions to the individual medical savings account, which
circumstances may include the accruing of a specified account
balance;
(6) Provisions relating to reporting payments for the
benefit of an employee from an individual medical savings account
for medical expenses to the group policy insurer; and
(7) Provisions relating to change or redesignation of a
trustee and provisions relating to circumstances requiring or
permitting continuation of coverage by the group plan or
conversion to an individual medical savings account upon
termination of an employee's employment.
(e) The tax commissioner is authorized to establish
penalties for early or unauthorized withdrawals from individual
medical savings accounts pursuant to rules promulgated in
accordance with article three, chapter twenty-nine-a of this
code. Which penalties may not exceed federal penalties for early or unauthorized withdrawals from individual retirement accounts
under the Internal Revenue Code of 1986, as amended.
§33-16-17. Commissioner to propose rules.
Pursuant to chapter twenty-nine-a of this code, the
commissioner shall have the power to propose rules, subject to
legislative approval, necessary to implement the provisions of
this article.
ARTICLE 16D. MARKETING AND RATE PRACTICES FOR SMALL EMPLOYER
ACCIDENT AND SICKNESS INSURANCE POLICIES.
§33-16D-2. Definitions.
As used in this article:
(a) "Actuarial certification" means a written statement by
an actuary, or other individual acceptable to the commissioner,
that a small employer carrier is in compliance with the
provisions of section five of this article, based upon that
person's examination, including a review of the appropriate
records and of the actuarial assumptions and methods utilized by
the carrier in establishing premium rates for applicable health
benefit plans.
(b) "Base premium rate" means, for each class of business as
to a rating period, the lowest premium rate charged or which
could have been charged under a rating system for that class of
business by the small employer carrier to small employers with
similar case characteristics for health benefit plans with the same or similar coverage.
(c)
"Carrier" means any person who provides accident and
sickness insurance in this state. For purposes of this article,
carrier includes a licensed insurance company; a hospital service
corporation, medical service corporation of health service
corporation organized pursuant to article twenty-four of this
chapter; a health care corporation organized pursuant to article
twenty-five of this chapter; a health maintenance organization
organized pursuant to article twenty-five-a of this chapter; a
multiple-employer trust or multiple-employer welfare arrangement;
or any other person providing a plan of accident and sickness
insurance subject to state insurance regulations. "Bona fide
association" has the meaning set forth in section one-a, article
sixteen of this chapter.
(d) "Case characteristics" mean demographic or other
relevant characteristics of a small employer, as determined by a
small employer carrier, which are considered by the carrier in
the determination of premium rates for the small employer. Claim
experience, health status and duration of coverage since issue
are not case characteristics for the purposes of this article.
(e) "Class of business" means all or any distinct grouping
of small employers as shown on the records of the small employer
carrier, which shall be subject to the following requirements:
(1) A distinct grouping may only be established by the small employer carrier on the basis that the applicable health benefit
plans:
(A) Are marketed and sold through individuals and
organizations which are not participating in the marketing or
sale of other distinct groupings of small employers for such
small employer carrier;
(B) Have been acquired from another small employer carrier
as a distinct grouping of plans;
(C) Are provided through
an a bona fide association;
with
membership of not less than two small employers which has been
formed for purposes other than obtaining insurance or
(D) Are in a class of business that meets the requirements
for exception to the restrictions related to premium rates
provided in paragraph (A), subdivision (1), subsection (a),
section five of this article.
(2) A small employer carrier may establish no more than two
additional groupings under subdivision (1) of this subsection on
the basis of underwriting criteria which are expected to produce
substantial variation in the health care costs.
(3) The commissioner may approve the establishment of
additional distinct groupings upon application to the
commissioner and a finding by the commissioner that such action
would enhance the efficiency and fairness of the small employer
insurance marketplace.
(f) "Commissioner" means the insurance commissioner of West
Virginia.
(g)
"Department" means the department of insurance.
"Creditable coverage" has the meaning set forth in section one-a,
article sixteen of this chapter.
(h) "Dependent" has the meaning set forth in section one-a,
article sixteen of this chapter.
(i) "Group health plan" has the meaning set forth in section
one-a, article sixteen of this chapter.
(h) (j) "Health benefit plan"
means any hospital or medical
expense incurred policy; health, hospital or medical service
corporation contract; plan provided by a multiple-employer trust
or a multiple-employer welfare arrangement; health maintenance
organization contract offered by an employer; or any other policy
or plan issued by a carrier which provides health related
benefits to small employers: Provided, That for purposes of this
article, a health benefit plan shall not include accident only,
credit, dental or disability income insurance; coverage issued as
a supplement to liability insurance; insurance arising out of a
workers' compensation or similar law; automobile medical-payment
insurance, or insurance under which benefits are payable with or
without regard to fault and which is statutorily required to be
contained in any liability insurance policy or equivalent
self-insurance has the meaning set forth in section one-a, article sixteen of this chapter.
(k) "Health status-related factor" has the meaning set forth
in section one-a, article sixteen of this chapter.
(i) (l) "Index rate" means for each class of business for
small employers with similar case characteristics the arithmetic
average of the applicable base premium rate and the corresponding
highest premium rate.
(j) (m) "Medical care" has the meaning set forth in section
one-a, article sixteen of this chapter.
(n) "Network plan" has the meaning set forth in section one-
a, article sixteen of this chapter.
(o) "New business premium rate" means, for each class of
business as to a rating period, the premium rate charged or
offered by the small employer carrier to small employers with
similar case characteristics for newly issued health benefit
plans with the same or similar coverage.
(p) "Preexisting condition exclusion" has the meaning set
forth in section one-a, article sixteen of this chapter.
(k) (q) "Rating period" means the calendar period of at
least twelve months for which premium rates established by a
small employer carrier are assumed to be in effect, as determined
by the small employer carrier.
(l) (r) "Small employer" means any person, firm,
corporation, partnership or association actively engaged in business in the state of West Virginia
for at least one year who,
on at least fifty percent of its working days during the
preceding
calendar year, employed
an average of no more than
sixty or fifty but not fewer than two eligible employees
and
employs at least two employees on the first day of its group
health plan year. Provided, That A new employer, not in
existence for all of the preceding calendar year, shall be
considered a small employer if it is reasonably expected to
employ an average of no more than fifty but not fewer than two
eligible employees on business days in the current calendar year.
Companies which are affiliated companies or which are eligible to
file a combined tax return for state tax purposes shall be
considered one employer.
(m) (s) "Small employer carrier"
or "carrier" means any
carrier health insurer, as defined in section one-a, article
sixteen of this chapter, which offers health benefit plans
covering the employees of a small employer situate within the
state of West Virginia.
§33-16D-4. Discrimination prohibited; guaranteed issue; filing
with commissioner; violations and penalties.
(a) All carriers subject to this article are strictly
prohibited from marketing their product to a specific group,
legal occupation, locale, zip code, neighborhood, race, religion,
or any discriminatory group.
(b) For plan years beginning after the thirtieth day of
June, one thousand nine hundred ninety-seven, in which the plan
has, on the first day of the plan year, at least two enrollees
who are current employees, each carrier shall accept every small
employer that applies for coverage under a health benefit plan,
unless such health benefit plan is made available only through a
bona fide association, and shall accept for enrollment in the
plan every employee of the small employer, including dependents,
when an employee or dependent first becomes eligible to enroll
under terms of the plan. This subsection shall not apply to:
(1) A network plan if the carrier:
(A) Limits coverage to a small employer's employees and
dependents who live or work in the carrier's service area; or
(B) Obtains the commissioner's approval to deny coverage in
its service area due to the carrier's lack of capacity for
additional enrollees, but only if the carrier denies coverage
uniformly to all small employers without regard to their claims
experience or that of their employees and dependents or to any
health status-related factor relating to employees and their
dependents. A carrier may not offer small group coverage in the
same service area for one hundred eighty days after the date
coverage is denied under this paragraph; or
(2) A carrier that obtains the commissioner's approval to
deny coverage due to the carrier's insufficient financial reserves for additional coverage, but only if the carrier denies
coverage uniformly to all small employers, consistent with all
requirements of this chapter and without regard to the claims
experience of the small employers and their employees and
dependents or to any health status-related factor relating to
employees and their dependents. A carrier may not offer small
group coverage for one hundred eighty days after the date
coverage is denied under this subdivision or until the carrier
has obtained the commissioner's approval of the level of its
reserves for additional coverage, whichever is later.
(b) (c) All carriers subject to this article shall file any
marketing information upon request of the commissioner. The
commissioner shall review said information and shall have the
authority to take appropriate action to eliminate discriminatory
marketing practices, including imposing fines on violators of
this section of not more than ten thousand dollars. Upon a second
violation of this section, the commissioner shall have the
authority to revoke the violator's license to transact insurance.
§33-16D-5. Premium rates for small employers; classes; maximum
rates; eligibility for rate increases.
(a) Premium rates for health benefit plans subject to this
article shall be subject to the following provisions:
(1) The index rate for a rating period for any class of
business shall not exceed the index rate for any other class of business by more than twenty percent:
Provided, That this
subdivision shall not apply to a class of business if all of the
following apply:
(A) The class of business is one for which the carrier does
not reject, and never has rejected, small employers included
within the definition of employers eligible for the class of
business or otherwise eligible employees and dependents who
enroll on a timely basis, based upon their claim experience or
health status;
(B) The carrier does not involuntarily transfer, and never
has involuntarily transferred, a health
benefits benefit plan
into or out of the class of business; and
(C) The class of business is currently available for
purchase.
(2) For a class of business, the premium rates charged
during a rating period to small employers with similar case
characteristics for the same or similar coverage, or the rates
which could be charged to such employers under the rating system
for that class of business, shall not vary from the index rate by
more than
twenty-five thirty percent of the index rate.
(3) 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 new business premium rate measured from the first day of the prior rating period to the
first day of the new rating period. In the case of a class of
business for which the small employer carrier is not issuing new
policies, the carrier shall use the percentage change in the base
premium rate;
(B) An adjustment, not to exceed fifteen percent annually
and adjusted pro rata for rating periods of less than one year,
due to the claim experience, health status or duration of
coverage of the employees or dependents of the small employer as
determined from the carrier's rate manual for the class of
business; and
(C) Any adjustment due to change in coverage or change in
the case characteristics of the small employer as determined from
the carrier's rate manual for the class of business.
(4) In the case of health benefit plans issued prior to the
effective date of this article, a premium rate for a rating
period may exceed the ranges described in subdivision (1) or (2)
of this subsection for a period of five years following the
effective date of this article. In that case, the percentage
increase in the premium rate charged to a small employer in such
a class of business for a new rating period may not exceed the
sum of the following:
(A) The percentage change in the new business premium rate
measured from the first day of the prior rating period to the first day of the new rating period. In the case of a class of
business for which the small employer carrier is not issuing new
policies, the carrier shall use the percentage change in the base
premium rate; and
(B) Any adjustment due to change in coverage or change in
the case characteristics of the small employer as determined from
the carrier's rate manual for the class of business.
(b) Nothing in this section is intended to affect the use by
a small employer carrier of legitimate rating factors other than
claim experience, health status or duration of coverage in the
determination of premium rates. Small employer carriers shall
apply rating factors, including case characteristics,
consistently with respect to all small employers in a class of
business.
(c) Adjustments in rates for claim experience, health status
and duration of coverage may not be charged to individual
employees or dependents. Any such adjustment shall be applied
uniformly to the rates charged for all employees and dependents
of the small employer.
(d) A small employer carrier shall utilize industry as a
case characteristic in establishing premium rates:
Provided,
That the highest rate factor associated with any industry
classification shall not exceed the lowest rate factor associated
with any industry classification by more than fifteen percent.
(e) Small employer carriers shall apply rating factors,
including case characteristics, consistently with respect to all
small employers in a class of business. Rating factors shall
produce premiums for identical groups which differ only by
amounts attributable to plan design and do not reflect
differences due to the nature of the groups assumed to select
particular health benefit plans.
(f) A small employer carrier may not involuntarily transfer
a small employer into or out of a class of business. A small
employer carrier may not offer to transfer a small employer into
or out of a class of business unless such offer is made to
transfer all small employers in the class of business without
regard to case characteristics, claim experience, health status
or duration since issue.
(g) To be eligible to make a rate increase request after the
first day of July, one thousand nine hundred ninety-three, a
carrier shall have a minimum anticipated loss ratio of
seventy-three percent. In calculating its minimum anticipated
loss ratio, an insurer shall include in its actual incurred
claims the amount of premium taxes for the same experience period
which are attributable to the policy forms or certificates
affected by this section and which were paid to the state of West
Virginia pursuant to the provisions of article three of this
chapter.
(h) All insurance carriers subject to this article,
effective the first day of July, one thousand nine hundred
ninety-three, shall be prohibited from distinguishing more than
four classes of business within its small group insurance
coverage.
(i) If any health benefit plan is provided by a carrier
through
an a bona fide association of small employers not in the
business of selling insurance and with not fewer than two hundred
cumulative employees, and if such association is rated on the
basis of the number of employees and not on the basis of the
individual small employers, such association or group is exempt
from the provisions of this article.
§33-16D-7. Renewability of coverage; exceptions.
(a) A health benefit plan subject to this article shall be
renewable to all eligible employees at the option of the small
employer:
Provided, That a carrier may refuse to renew a health
benefit plan
for plan years beginning on or before the thirtieth
day of June, one thousand nine hundred ninety-seven, for any of
the following reasons:
(1) Nonpayment of required premiums;
(2) Fraud or misrepresentation by the small employer or by
the insured individual;
(3) Noncompliance with plan provisions;
(4) The number of individuals covered under the plan is fewer than the number or less than the percentage of eligible
individuals necessary pursuant to the percentage requirements
under the plan; or
(5) The small employer is no longer actively engaged in the
business in which it was engaged on the effective date of the
plan.
(b) For plan years beginning after the thirtieth day of
June, one thousand nine hundred ninety-seven, in which the plan
has, on the first day of the plan year, at least two enrollees
who are current employees, a health benefit plan shall be
renewable to all eligible employees at the option of the small
employer, and a carrier may refuse to renew a health benefit plan
only for one of the following reasons:
(1) Nonpayment of required premiums;
(2) Fraud or misrepresentation of material fact by the small
employer;
(3) The number of individuals covered under the plan is
fewer than the number or less than the percentage of eligible
individuals necessary pursuant to the percentage requirements
under the plan;
(4) The carrier ceases to offer health benefit plans to
small employers as provided in subsection (d) of this section;
(5) For coverage offered under a network plan, a carrier no
longer has any enrollees of the network plan who live or work in the plan's service area, and the carrier would deny coverage
under the network plan to a small employer with no eligible
employees or dependents in its service area; or
(6) For health benefit plans offered only through a bona
fide association, the small employer ceases to be a member of the
association, if plans are terminated uniformly without respect to
any health status-related factor relating to any covered
employee, association member or dependent. With respect to
coverage provided to a small employer only through a bona fide
association, a reference to "policyholder" or "plan sponsor" is
deemed to include a reference to the small employer.
(b) (c)(1) For plan years beginning on or before the
thirtieth day of June, one thousand nine hundred ninety-seven,
a small employer carrier may cease to renew all plans under a
class of business. Upon the small employer's election of
nonrenewal, the carrier shall provide notice of such election not
to renew to all affected health benefit plans and to the
commissioner in each state in which an affected insured
individual is known to reside at least ninety days prior to
termination of coverage.
(c) (2)A carrier which exercises its right to cease to
renew all plans in a class of business
pursuant to this
subsection may not:
(1) (A) Establish a new class of business for a period of five years after the nonrenewal of the plans without prior
approval of the commissioner; or
(2) (B) Transfer or otherwise provide coverage to any of the
employers from the nonrenewed class of business unless the
carrier offers to transfer or provide coverage to all affected
employers and eligible employees without regard to case
characteristics, claim experience, health status or duration of
coverage.
(d) For plan years beginning after the thirtieth day of
June, one thousand nine hundred ninety-seven, in which the plan
has, on the first day of the plan year, at least two enrollees
who are current employees, a carrier may elect to discontinue
offering health benefit plans:
(1) Of a particular type, if the carrier gives notice to
each small employer affected and to all covered employees and
dependents at least ninety days before the date coverage is
discontinued. The carrier shall offer each such small employer
the option to purchase all other health benefit plans offered by
the carrier to small employers. In electing to discontinue
health benefit plans of a particular type and in offering
coverage under the preceding sentence, the carrier shall act
uniformly without regard to small employers' claims experience or
any health status-related factor relating to any covered employee
or dependent or new employees or dependents who may become eligible for coverage; or
(2) Of all types if the carrier gives notice to the
commissioner, to each small employer affected and to all covered
employees or members and dependents at least one hundred eighty
days before the date such plans are discontinued. The carrier
shall discontinue all, and not renew any, health benefit plans in
the small group market. The carrier may not issue any health
benefit plan to a small employer in this state for a five-year
period beginning on the date the last discontinued health benefit
plan is not renewed.
(e) For plan years beginning after the thirtieth day of
June, one thousand nine hundred ninety-seven, in which the plan
has, on the first day of the plan year, at least two enrollees
who are current employees, a carrier may modify a health benefit
plan upon its renewal only if the modification is consistent with
the provisions of this article and effective on a uniform basis
among all individuals with that policy form. Except for coverage
available only through an association, any modification shall be
made effective on a uniform basis among all small employers with
that product.
§33-16D-8. Disclosure of rating practices, renewability
provisions and availability of health benefit plans.
(a) Each small employer carrier shall make reasonable disclosure in solicitation and sales materials provided to small
employers of the following:
(1) The extent to which premium rates for a specific small
employer are established or adjusted due to the claim experience,
health status or duration of coverage of the employees of the
small employer;
(2) The provisions concerning the carrier's right to change
premium rates and the factors, including case characteristics,
which affect changes in premium rates;
(3) A description of the class of business in which the
small employer is or will be included, including the applicable
grouping of plans
and the benefits and premiums available under
all health benefit plans for which the small employer is
qualified;
(4) The provisions relating to renewability of coverage;
(5) The provisions relating to any preexisting conditions
limitations; and
(6) An explanation, if applicable, that the small employer
is purchasing a minimum benefits plan issued pursuant to article
sixteen-c of this chapter.
(b) All disclosure statements shall be presented in clear
and understandable form and format and shall be separate from any
policy, certificate or evidence of coverage otherwise provided.
No carrier may be required under this section to disclose proprietary or trade secret information to a small employer.
§33-16D-10. Suspension of requirements.
The
insurance commissioner may suspend all or part of the
requirements of this article,
other than sections four, seven,
eight and twelve, applicable to one or more health benefit plans
for one or more rating periods upon a filing by the small
employer carrier and a finding by the commissioner that either
the suspension is reasonable in light of the financial condition
of the carrier or that the suspension would enhance the
efficiency and fairness of the marketplace for small employer
health insurance.
§33-16D-11. Effective date.
Except as otherwise provided, the provisions of this article
shall apply to each health benefit plan for a small employer
situate in the state of West Virginia that is delivered, issued
for delivery, renewed or continued after the effective date of
this article. For purposes of this section, the date a plan is
continued is the first rating period which commences after the
effective date of this article.
§33-16D-12. Equality of terms; preexisting conditions;
continuous coverage restrictions, eligibility for enrollment.
Health benefit plans and, to the extent permitted by the
federal Employee Retirement Income Security Act (ERISA), other benefit arrangements covering small employers shall be subject to
the following provisions:
(a) Preexisting conditions provisions may not exclude
coverage for a period beyond twelve months following an
individual's effective date of coverage and may only relate to
conditions which had, during the twelve months immediately
preceding the effective date of coverage, manifested themselves
in such a manner as would cause an ordinarily prudent person to
seek medical advice, diagnosis, care or treatment or for which
medical advice, diagnosis, care or treatment was recommended or
received, or as to a pregnancy existing on the effective day of
coverage.
For plan years beginning after the thirtieth day of
June, one thousand nine hundred ninety-seven, in which the plan
has, on the first day of the plan year, at least two enrollees
who are current employees, a health benefit plan shall meet all
requirements set forth in section three-k, article sixteen of
this chapter (preexisting condition exclusions).
(b) In determining whether a preexisting condition
limitation provision applies to an eligible employee or
dependent, all health benefit plans shall credit the time such
person was covered under a previous employer-based health benefit
plan, a comparable individual health benefit plan, or a
self-insured plan if the previous coverage was continuous to a
date not more than thirty days prior to the effective date of the new coverage, exclusive of any applicable waiting period under
such plan.
For plan years beginning after the thirtieth day of
June, one thousand nine hundred ninety-seven, in which the plan
has, on the first day of the plan year, at least two enrollees
who are current employees, a health benefit plan shall meet all
requirements set forth in section three-m, article sixteen of
this chapter (creditable coverage).
(c) Subject to subsections (a) and (b) of this section, when
a small group employer converts its health benefit plan from one
health benefit plan to another health benefit plan or from one
carrier to another carrier, all eligible employees who at the
time of conversion are covered by the health benefit plan shall
be offered health benefits coverage under the subsequent plan,
and no employee who at the time of conversion is covered by a
health benefit plan offered by said employer may be treated any
differently relative to other covered employees under the new
health benefit plan than he or she is treated under the current
health benefit plan.
(d) For plan years beginning after the thirtieth day of
June, one thousand nine hundred ninety-seven, in which the plan
has, on the first day of the plan year, at least two enrollees
who are current employees, a health benefit plan shall meet all
requirements set forth in section three-n, article sixteen of
this chapter (eligibility enrollment periods).
§33-16D-15. Continuation of coverage under small plans.
The Legislature finds that the provisions of this article do
not address continuing coverage under a health benefit plan.
Therefore, the commissioner is to perform or have performed a
study to determine the feasibility and advisability of
implementing continuation of coverage under health benefit plans
issued to small employers with fewer than twenty employees. The
commissioner shall make a report of findings, conclusions and
recommendations to the Legislature during its regular session in
the year one thousand nine hundred ninety-eight.
ARTICLE 23. FRATERNAL BENEFIT SOCIETIES.
§33-23-24. Filing and approval of accident and sickness insurance certificates.
(a) No domestic, foreign or alien society licensed in this
state shall issue or deliver in this state any certificate or
other evidence of any contract of accident and sickness insurance
unless and until the form thereof, together with the form of
application and all riders or endorsements for use in connection
therewith, shall have been filed with the commissioner and
approved by him
or her as conforming to reasonable rules
and
regulations from time to time
made by him in effect and as not
inconsistent with any other provisions of law applicable thereto.
The commissioner shall, within a reasonable time after the filing
of any
such form, notify the society filing the
same form either of
his the approval or
of his disapproval of
such the form. The
commissioner may
in his or her discretion approve any
such form
which
in his opinion contains provisions
on any one or more of
the several requirements made by him which are more favorable to
the members than the
one or ones
so required.
(b) Pursuant to
the foregoing provisions the chapter twenty-
nine-a of this code, the commissioner
shall have power, from time
to time, to make, alter and supersede reasonable regulations
prescribing the required, optional and prohibited provisions in
such contracts may promulgate rules necessary to implement the
provisions of this section, and such
regulations rules shall
conform, as far as practicable, to the provisions of article
fifteen (Accident and Sickness Insurance) and article sixteen
(Group Accident and Sickness Insurance) of this chapter.
(1) For any certificate or other evidence of coverage issued
before the first day of July, one thousand nine hundred ninety- seven, and for any certificate or other evidence of coverage
under a health benefit plan issued on or after the first day of
July, one thousand nine hundred ninety-seven, other than in
connection with a group health plan, where the commissioner deems
inapplicable, either in part or in their entirety, the provisions
of
the foregoing articles
fifteen or sixteen of this chapter, he
the commissioner may prescribe the portions or summary thereof of
the contract to be printed on the certificate issued to the member.
For purposes of this subsection, the terms "group health
plan" and "health benefit plan" have the meanings set forth in
section one-a, article sixteen of this chapter.
(2) For any certificate or other evidence of individual
coverage issued or renewed on or after the first day of July, one
thousand nine hundred ninety-seven, the society shall comply with
all provisions of article fifteen of this chapter. For any
certificate or other evidence of coverage under a health benefit
plan issued in connection with a group health plan on or after
the first day of July, one thousand nine hundred ninety-seven,
the society shall comply with all provisions of article sixteen
of this chapter, and for a health benefit plan issued to a small
employer, as defined in section two, article sixteen-d of this
chapter, with all provisions of article sixteen-d of this
chapter.
(c) Any filing made hereunder shall be deemed approved
unless disapproved within sixty days from the date of such
filing.
ARTICLE 24. HOSPITAL SERVICE CORPORATIONS, MEDICAL SERVICE
CORPORATIONS, DENTAL SERVICE CORPORATIONS AND HEALTH SERVICE CORPORATIONS.
§33-24-4. Exemptions; applicability of insurance laws.
Every corporation defined in section two of this article is
hereby declared to be a scientific, nonprofit institution and exempt from the payment of all property and other taxes. Every
corporation, to the same extent the provisions are applicable to
insurers transacting similar kinds of insurance and not
inconsistent with the provisions of this article, shall be
governed by and be subject to the provisions as hereinbelow
indicated, of the following articles of this chapter: Article two
(insurance commissioner), except that, under section nine of said
article, examinations shall be conducted at least once every four
years; article four (general provisions), except that section
sixteen of said article shall not be applicable thereto; section
thirty-four, article six (fee for form and rate filing); article
six-c (guaranteed loss ratio); article seven (assets and
liabilities); article eleven (unfair trade practices); article
twelve (agents, brokers and solicitors), except that the agent's
license fee shall be
five twenty-five dollars;
section two-a,
article fifteen (definitions); section two-b, article fifteen
(guaranteed issue); section two-d, article fifteen (exception to
guaranteed renewability); section two-e, article fifteen
(discontinuation of coverage); section two-f article fifteen
(certification of creditable coverage); section two-g, article
fifteen (applicability); section four-e, article fifteen
(benefits for mothers and newborns); section fourteen, article
fifteen (individual accident and sickness insurance); section
sixteen, article fifteen (coverage of children); section eighteen, article fifteen (equal treatment of state agency);
section nineteen, article fifteen (coordination of benefits with
medicaid); article fifteen-a (long-term care insurance); article
fifteen-c (diabetes insurance); section three, article sixteen
(required policy provisions); section three-a, article sixteen
(mental
illness health); section three-c, article sixteen (group
accident and sickness insurance); section three-d, article
sixteen (medicare supplement insurance); section three-f, article
sixteen (treatment of temporomandibular joint disorder and
craniomandibular disorder);
section three-j, article sixteen
(benefits for mothers and newborns); section three-k, article
sixteen (preexisting condition exclusions); section three-l,
article sixteen (guaranteed renewability); section three-m,
article sixteen (creditable coverage); section three-n, article
sixteen (eligibility for enrollment); section eleven, article
sixteen (coverage of children); section thirteen, article sixteen
(equal treatment of state agency); section fourteen, article
sixteen (coordination of benefits with medicaid); section
sixteen, article sixteen (diabetes insurance); article sixteen-a
(group health insurance conversion); article sixteen-c (small
employer group policies); article sixteen-d (marketing and rate
practices for small employers); article twenty-six-a (West
Virginia life and health insurance guaranty association act),
after the first day of October, one thousand nine hundred ninety-one; article twenty-seven (insurance holding company
systems); article twenty-eight (individual accident and sickness
insurance minimum standards); article thirty-three (annual
audited financial report); article thirty-four (administrative
supervision); article thirty-four-a (standards and commissioner's
authority for companies deemed to be in hazardous financial
condition); article thirty-five (criminal sanctions for failure
to report impairment); and article thirty-seven (managing general
agents); and no other provision of this chapter may apply to
these corporations unless specifically made applicable by the
provisions of this article. If, however, the corporation is
converted into a corporation organized for a pecuniary profit or
if it transacts business without having obtained a license as
required by section five of this article, it shall thereupon
forfeit its right to these exemptions.
ARTICLE 25. HEALTH CARE CORPORATIONS.
§33-25-6. Supervision and regulation by insurance commissioner; exemption from insurance laws.
Corporations organized under this article are subject to
supervision and regulation of the insurance commissioner. The
corporations organized under this article, to the same extent
these provisions are applicable to insurers transacting similar
kinds of insurance and not inconsistent with the provisions of
this article, shall be governed by and be subject to the provisions as hereinbelow indicated of the following articles of
this chapter: Article four (general provisions), except that
section sixteen of said article shall not be applicable thereto;
article six-c (guaranteed loss ratio); article seven (assets and
liabilities); article eight (investments); article ten
(rehabilitation and liquidation);
section two-a, article fifteen
(definitions); section two-b, article fifteen (guaranteed issue);
section two-d, article fifteen (exception to guaranteed
renewability); section two-e, article fifteen (discontinuation of
coverage); section two-f, article fifteen (certification of
creditable coverage); section two-g, article fifteen
(applicability); section four-e, article fifteen (benefits for
mothers and newborns); section fourteen, article fifteen
(individual accident and sickness insurance); section sixteen,
article fifteen (coverage of children); section eighteen, article
fifteen (equal treatment of state agency); section nineteen,
article fifteen (coordination of benefits with medicaid); section
three, article sixteen (required policy provisions);
section
three-a, article sixteen (mental health); section three-j,
article sixteen (benefits for mothers and newborns); section
three-k, article sixteen (preexisting condition exclusions);
section three-l, article sixteen (guaranteed renewability);
section three-m, article sixteen (creditable coverage); section
three-n, article sixteen (eligibility for enrollment); section eleven, article sixteen (coverage of children); section thirteen,
article sixteen (equal treatment of state agency); section
fourteen, article sixteen (coordination of benefits with
medicaid);
section sixteen, article sixteen (diabetes insurance;
article sixteen-a (group health insurance conversion); article
sixteen-c (small employer group policies); article sixteen-d
(marketing and rate practices for small employers); article
twenty-six-a (West Virginia life and health insurance guaranty
association act); article twenty-seven (insurance holding company
systems); article thirty-three (annual audited financial report);
article thirty-four-a (standards and commissioner's authority for
companies deemed to be in hazardous financial condition); article
thirty five (criminal sanctions for failure to report
impairment); and article thirty-seven (managing general agents);
and no other provision of this chapter may apply to these
corporations unless specifically made applicable by the
provisions of this article.
ARTICLE 25A. HEALTH MAINTENANCE ORGANIZATION ACT.
§33-25A-24. Statutory construction and relationship to other laws.
(a) Except as otherwise provided in this article, provisions
of the insurance laws and provisions of hospital or medical
service corporation laws are not applicable to any health
maintenance organization granted a certificate of authority under this article. The provisions of this article shall not apply to
an insurer or hospital or medical service corporation licensed
and regulated pursuant to the insurance laws or the hospital or
medical service corporation laws of this state except with
respect to its health maintenance corporation activities
authorized and regulated pursuant to this article. The
provisions of this article shall not apply to an entity properly
licensed by a reciprocal state to provide health care services to
employer groups, where residents of West Virginia are members of
an employer group, and the employer group contract is entered
into in the reciprocal state. For purposes of this subsection,
a "reciprocal state" means a state which physically borders West
Virginia and which has subscriber or enrollee hold harmless
requirements substantially similar to those set out in section
seven-a of this article.
(b) Factually accurate advertising or solicitation regarding
the range of services provided, the premiums and copayments
charged, the sites of services and hours of operation, and any
other quantifiable, nonprofessional aspects of its operation by
a health maintenance organization granted a certificate of
authority, or its representative shall not be construed to
violate any provision of law relating to solicitation or
advertising by health professions:
Provided, That nothing
contained in this subsection shall be construed as authorizing any solicitation or advertising which identifies or refers to any
individual provider or makes any qualitative judgment concerning
any provider.
(c) Any health maintenance organization authorized under
this article shall not be considered to be practicing medicine
and is exempt from the provisions of chapter thirty of this code,
relating to the practice of medicine.
(d) The provisions of section fifteen, article four (general
provisions); section seventeen, article six (noncomplying forms);
article six-c (guaranteed loss ratio); article seven (assets and
liabilities); article eight (investments); article nine
(administration of deposits); article twelve (agents, brokers,
solicitors and excess line);
section two-a, article fifteen
(definitions); section two-b, article fifteen (guaranteed issue);
section two-d, article fifteen (exception to guaranteed
renewability); section two-e, article fifteen (discontinuation of
coverage); section two-f, article fifteen (certification of
creditable coverage); section two-g, article fifteen
(applicability); section four-e, article fifteen (benefits for
mothers and newborns); section fourteen, article fifteen
(individual accident and sickness insurance); section sixteen,
article fifteen (coverage of children); section eighteen, article
fifteen (equal treatment of state agency); section nineteen,
article fifteen (coordination of benefits with medicaid); article fifteen-b (uniform health care administration act); article
fifteen-c (diabetes insurance); section three, article sixteen
(required policy provisions);
section three-a, article sixteen
(mental health); section three-f, article sixteen (treatment of
temporomandibular disorder and craniomandibular disorder);
section three-j, article sixteen (benefits for mothers and
newborns); section three-k, article sixteen (preexisting
condition exclusions); section three-l, article sixteen
(guaranteed renewability); section three-m, article sixteen
(creditable coverage); section three-n, article (eligibility for
enrollment), section eleven, article sixteen (coverage of
children); section thirteen, article sixteen (equal treatment of
state agency); section fourteen, article sixteen (coordination of
benefits with medicaid); section sixteen, article sixteen
(diabetes insurance); article sixteen-a (group health insurance
conversion); article sixteen-c (small employer group policies);
article sixteen-d (marketing and rate practices for small
employers); article twenty-seven (insurance holding company
systems); article thirty-four-a (standards and commissioner's
authority for companies deemed to be in hazardous financial
condition); article thirty-five (criminal sanctions for failure
to report impairment); article thirty-seven (managing general
agents); and article thirty-nine (disclosure of material
transactions) shall be applicable to any health maintenance organization granted a certificate of authority under this
article. In circumstances where the code provisions made
applicable to health maintenance organizations by this section
refer to the "insurer", the "corporation" or words of similar
import, the language shall be construed to include health
maintenance organizations.
(e) Any long-term care insurance policy delivered or issued
for delivery in this state by a health maintenance organization
shall comply with the provisions of article fifteen-a of this
chapter.
(f) A health maintenance organization granted a certificate
of authority under this article shall be exempt from paying
municipal business and occupation taxes on gross income it
receives from its enrollees, or from their employers or others on
their behalf, for health care items or services provided directly
or indirectly by the health maintenance organization. This
exemption applies to all taxable years through the thirty-first
day of December, one thousand nine hundred ninety-six. The
commissioner and the tax department shall conduct a study of the
appropriations of imposition of the municipal business and
occupation tax or other tax on health maintenance organizations,
and shall report to the regular session of the Legislature, one
thousand nine hundred ninety-seven, on their findings,
conclusions and recommendations, together with drafts of any legislation necessary to effectuate their recommendations.
NOTE: The purpose of this bill is to broaden the
availability and continuity of health insurance coverage and to
implement standards required by the federal Health Insurance
Portability and Accountability Act of 1996 (HIPAA) and amendments
to HIPAA enacted in the federal Newborns' and Mothers' Health
Protection Act of 1996 and the federal Mental Health Parity Act
of 1996.
Strike-throughs indicate language that would be stricken
from the present law, and underscoring indicates language that
would be added.
§§33-15-2a, 2b, 2c, 2d, 2e, 2f, 2g, 4e
are new; therefore,
strike-throughs and underscoring have been omitted
.
§§33-16-1a, 3j, 3k, 3l, 3m, 3n, 17
are new; therefore,
strike-throughs and underscoring have been omitted.
§3
3-16D-15 is new; therefore, strike-throughs and
underscoring have been omitted.
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