RS 22:1111 Medicare supplement minimum standards
SUBPART E. MEDICARE SUPPLEMENT MINIMUM STANDARDS
§1111. Medicare supplement minimum standards
A.(1) Except as otherwise specifically provided, this Section shall apply to:
(a) All Medicare supplement policies and subscriber contracts delivered or issued for delivery in this state on or after the effective date hereof, and
(b) All certificates issued under group Medicare supplement policies or subscriber contracts which have been delivered or issued for delivery in this state.
(2) Except as otherwise specifically provided in Paragraph F(3), the provisions of this Section are not intended to prohibit or apply to insurance policies or health care benefit plans, including group conversion policies, provided to Medicare eligible persons which are not marketed or held to be Medicare supplement policies or benefit plans.
B. For purposes of this Section, the following terms shall have the meaning indicated herein:
(1) "Applicant" means:
(a) In the case of an individual Medicare supplement policy or subscriber contract, the person who seeks to contract for insurance benefits, and
(b) In the case of a group Medicare supplement policy or subscriber contract, the proposed certificate holder.
(2) "Medicare supplement policy" means a group or individual policy of health insurance or a subscriber contract of hospital and medical service associations or health maintenance organizations, other than a policy issued pursuant to a contract under Section 1876 of the federal Social Security Act (42 U.S.C. 1395 et seq.), or an issued policy under a demonstration project specified in 42 U.S.C. 1395ss(g)(1), which is advertised, marketed, or designed primarily as a supplement to reimbursement under Medicare for the hospital, medical, or surgical expenses of a person eligible for Medicare. The term does not include a policy or contract of one or more employers or labor organizations, or of the trustees of a fund established by one or more employers or labor organizations, or a combination thereof, for employees or former employees, or a combination thereof, or for members or former members, or a combination thereof, of the labor organizations.
(3) "Certificate" means a certificate issued under a group Medicare supplement policy, which policy has been delivered or issued for delivery in this state.
(4) "Medicare" means the "Health Insurance for the Aged Act", Title XVIII of the Social Security Amendments of 1965, as then constituted or later amended.
C.(1) The commissioner shall issue reasonable regulations to establish specific standards for policy provisions of Medicare supplement policies and certificates. Such standards shall be in addition to and in accordance with applicable laws of this state. No requirement of the Louisiana Insurance Code relating to minimum required policy benefits, other than the minimum standards contained in this Section, shall apply to Medicare supplement policies. The standards may cover but shall not be limited to:
(a) Terms of renewability.
(b) Initial and subsequent conditions of eligibility.
(c) Nonduplication of coverage.
(d) Probationary periods.
(e) Benefit limitations, exceptions, and reductions.
(f) Elimination periods.
(g) Requirements for replacement.
(h) Recurrent conditions.
(i) Definition of terms.
(2) The commissioner may issue reasonable regulations that specify prohibited policy provisions not otherwise specifically authorized by statute, which in the opinion of the commissioner, are unjust, unfair, or unfairly discriminatory to any person insured or proposed for coverage under a Medicare supplement policy.
(3) Notwithstanding any other provisions of law, a Medicare supplement policy shall not deny a claim for losses, incurred more than six months from the effective date of coverage, for a preexisting condition. The policy shall not define a preexisting condition more restrictively than a condition for which medical advice was given or treatment was recommended by, or received from, a physician within six months before the effective date of coverage.
D. The commissioner shall issue reasonable regulations to establish minimum standards for benefits, claims payment, marketing practices, compensation arrangements, and reporting practices for Medicare supplement policies. No Medicare supplement insurance policy, contract, or certificate in force in the state shall contain benefits which duplicate benefits provided by Medicare.
E.(1) Every insurer providing group Medicare supplement insurance benefits to a resident of this state pursuant to this Section shall file for approval by the commissioner a copy of the master policy and any certificate used in this state in accordance with the filing requirements and procedures applicable to group Medicare supplement policies issued in this state.
(2)(a) Medicare supplement policies shall return to policyholders benefits which are reasonable in relation to the premium charged. The commissioner shall issue reasonable rules and regulations to establish minimum standards for loss ratios of Medicare supplement policies on the basis of incurred claims experience, or incurred health care expenses where coverage is provided by a health maintenance organization on a service rather than reimbursement basis, and earned premiums in accordance with accepted actuarial principles and practices.
(b) Each entity providing Medicare supplement policies or certificates in this state shall annually file its rates, rating schedule, and supporting documentation demonstrating that it is in compliance with the applicable loss-ratio standards of this state. All filings of rates and rating schedules shall demonstrate that the actual and expected losses in relation to premiums comply with the requirements of this Subpart.1
(3) Repealed by Acts 1990, No. 656, §2.
F.(1) In order to provide for full and fair disclosure in the sale of Medicare supplement policies, no Medicare supplement policy or certificate shall be delivered in this state unless an outline of coverage is delivered to the applicant at the time application is made. The commissioner shall prescribe the format and content of the outline of coverage required by this Subsection. In this Subsection, "format" means style, arrangements, and overall appearance, including such items as the size, color, and prominence of type and arrangement of text and captions. The outline of coverage shall include:
(a) A description of the principal benefits and coverage provided in the policy.
(b) A statement of the exceptions, reductions, and limitations contained in the policy.
(c) A statement of the renewal provisions, including any reservation by the insurer of a right to change premiums.
(d) A statement that the outline of coverage is a summary of the policy issued or applied for, and that the policy should be consulted to determine governing contractual provisions.
(2) The commissioner may prescribe by regulation a standard form and the contents of an informational brochure for persons eligible for Medicare, which is intended to improve the buyer's ability to select the most appropriate coverage and improve the buyer's understanding of Medicare. Except in the case of direct response insurance policies, the commissioner may require by regulation that the informational brochure be provided to any prospective insureds eligible for Medicare concurrently with delivery of the outline of coverage. With respect to direct response insurance policies, the commissioner may require by regulation that the prescribed brochure shall be provided to any prospective insureds eligible for Medicare upon request, but in no event later than the time of policy delivery.
(3) The commissioner may promulgate regulations for captions or notice requirements, determined to be in the public interest and designed to inform prospective insureds that particular insurance coverages are not Medicare supplement coverages, for all accident and sickness insurance policies sold to persons eligible for Medicare, other than:
(a) Medicare supplement policies;
(b) Disability income policies;
(c), (d) Repealed by Acts 1997, No. 633, §2, eff. July 3, 1997.
(4) The commissioner may further promulgate reasonable regulations to govern the full and fair disclosure of the information in connection with the replacement of accident and sickness policies, subscriber contracts, or certificates by persons eligible for Medicare.
G. Medicare supplement policies or certificates shall have a notice prominently printed on the first page of the policy or certificate or attached thereto stating in substance that the applicant shall have the right to return the policy or certificate within thirty days of its delivery and to have the premium refunded if, after examination of the policy or certificate, the applicant is not satisfied for any reason. Any refund made pursuant to this Subsection shall be paid directly to the applicant by the insurer in a timely manner.
H. Every insurer, health care service plan, or other entity providing Medicare supplement insurance or benefits in this state shall provide a copy of any Medicare supplement advertisement intended for use in this state, whether through written, radio, or television medium, to the commissioner for his review and approval to the extent permitted under the Insurance Code, particularly under R.S. 22:1967.
I. Rules and regulations promulgated pursuant to this Section shall be subject to the Administrative Procedure Act.
J. In addition to any other applicable penalties for violation of provisions of the Louisiana Insurance Code, the commissioner may require an insurer who violates any provision of this Section or regulations promulgated pursuant to this Section to cease marketing any Medicare supplement policy or certificate in this state which is related directly or indirectly to a violation, or may require such insurer to take such actions as are necessary to comply with the provisions of this Section, or both.
K. Payment of premiums for Medicare supplement policies shall only be made as follows:
(1) By check, money order, or bank draft made payable to the insurer; or
(2) By cash, provided that an insurer's receipt which binds the insurer for receipt of such premium shall be issued to the insured.
L. The commissioner may adopt reasonable regulations as are necessary to conform Medicare supplement policies and certificates with the requirements of federal law and regulations promulgated thereunder, including but not limited to:
(1) Requiring refunds or credits if the policies or certificates do not satisfy loss ratio requirements.
(2) Establishing a uniform methodology for calculating and reporting loss ratios.
(3) Assuring public access to policies, premiums, and loss ratio information of issuers of Medicare supplement insurance.
(4) Establishing a process for the approval or disapproval of policy forms and certificate forms and proposed premium increases.
(5) Establishing a policy for holding public hearings prior to the approval of any premium increase.
(6) Establishing standards for Medicare Select policies and certificates.
Added by Acts 1981, No. 146, §1, eff. Jan. 1, 1982; Acts 1989, No. 447, §1, eff. Sept. 1, 1989; Acts 1990, No. 656, §§1 and 2; Acts 1992, No. 428, §1, eff. July 1, 1992; Acts 1997, No. 633, §§1, 2 eff. July 3, 1997; Redesignated from R.S. 22:224 by Acts 2008, No. 415, §1, eff. Jan. 1, 2009.
1As appears in enrolled bill.