513B.5 - PROVISIONS ON RENEWABILITY OF COVERAGE.

        513B.5  PROVISIONS ON RENEWABILITY OF COVERAGE.         1.  Health insurance coverage subject to this chapter is renewable      with respect to all eligible employees or their dependents, at the      option of the small employer, except for one or more of the following      reasons:         a.  The health insurance coverage sponsor fails to pay, or to      make timely payment of, premiums or contributions pursuant to the      terms of the health insurance coverage.         b.  The health insurance coverage sponsor performs an act or      practice constituting fraud or makes an intentional misrepresentation      of a material fact under the terms of the coverage.         c.  Noncompliance with the carrier's or organized delivery      system's minimum participation requirements.         d.  Noncompliance with the carrier's or organized delivery      system's employer contribution requirements.         e.  A decision by the carrier or organized delivery system to      discontinue offering a particular type of health insurance coverage      in the state's small employer market.  Health insurance coverage may      be discontinued by the carrier or organized delivery system in that      market only if the carrier or organized delivery system does all of      the following:         (1)  Provides advance notice of its decision to discontinue such      plan to the commissioner or director of public health.  Notice to the      commissioner or director, at a minimum, shall be no less than three      days prior to the notice provided for in subparagraph (2) to affected      small employers, participants, and beneficiaries.         (2)  Provides notice of its decision not to renew such plan to all      affected small employers, participants, and beneficiaries no less      than ninety days prior to the nonrenewal of the plan.         (3)  Offers to each plan sponsor of the discontinued coverage, the      option to purchase any other coverage currently offered by the      carrier or organized delivery system to other employers in this      state.         (4)  Acts uniformly, in opting to discontinue the coverage and in      offering the option under subparagraph (3), without regard to the      claims experience of the sponsors under the discontinued coverage or      to a health status-related factor relating to any participants or      beneficiaries covered or new participants or beneficiaries who may      become eligible for the coverage.         f.  A decision by the carrier or organized delivery system to      discontinue offering and to cease to renew all of its health      insurance coverage delivered or issued for delivery to small      employers in this state.  A carrier or organized delivery system      making such decision shall do all of the following:         (1)  Provide advance notice of its decision to discontinue such      coverage to the commissioner or director of public health.  Notice to      the commissioner or director, at a minimum, shall be no less than      three days prior to the notice provided for in subparagraph (2) to      affected small employers, participants, and beneficiaries.         (2)  Provide notice of its decision not to renew such coverage to      all affected small employers, participants, and beneficiaries no less      than one hundred eighty days prior to the nonrenewal of the coverage.         (3)  Discontinue all health insurance coverage issued or delivered      for issuance to small employers in this state and cease renewal of      such coverage.         g.  The membership of an employer in an association, which is      the basis for the coverage which is provided through such      association, ceases, but only if the termination of coverage under      this paragraph occurs uniformly without regard to any health      status-related factor relating to any covered individual.         h.  The commissioner or director of public health finds that      the continuation of the coverage is not in the best interests of the      policyholders or certificate holders, or would impair the carrier's      or organized delivery system's ability to meet its contractual      obligations.         i.  At the time of coverage renewal, a carrier or organized      delivery system may modify the health insurance coverage for a      product offered under group health insurance coverage in the small      group market, for coverage that is available in such market other      than only through one or more bona fide associations, if such      modification is consistent with the laws of this state, and is      effective on a uniform basis among group health insurance coverage      with that product.         2.  A carrier or organized delivery system that elects not to      renew health insurance coverage under subsection 1, paragraph      "f", shall not write any new business in the small employer      market in this state for a period of five years after the date of      notice to the commissioner or director of public health.         3.  This section, with respect to a carrier or organized delivery      system doing business in one established geographic service area of      the state, applies only to such carrier's or organized delivery      system's operations in that service area.  
         Section History: Recent Form
         91 Acts, ch 244, § 5; 92 Acts, ch 1167, § 8, 9; 93 Acts, ch 80, §      6; 97 Acts, ch 103, §19         Referred to in § 513B.10