02-031 C.M.R. ch. 755, § 4 - Policy Definitions

A. Except as provided in this rule, an individual health insurance policy or group health insurance policy or certificate delivered or issued for delivery to any person in this state and to which this rule applies shall contain definitions respecting the matters set forth below that comply with the requirements of this section. Definitions may need to be modified to comply with other requirements specified in Section 3(D).

B. The Superintendent may approve any substitute definition that is, in his or her opinion, not less favorable in any particular to the insured or beneficiary than the provisions otherwise required.

C. "Accident," "accidental injury," and "accidental means" shall be defined to employ "result" language and shall not include words that establish an accidental means test or use words such as "external, violent, visible wounds" or similar words of description or characterization. The definition shall not be more restrictive than the following: "accident," "accidental injury," or "accidental means" means accidental bodily injury sustained by the insured person that is the direct cause of the condition for which benefits are provided and that occurs while the insurance is in force.

D. "Convalescent nursing home," "extended care facility," or "skilled nursing facility" shall be defined in relation to its status, facility, and available services.

(1) A definition of the home or facility shall not be more restrictive than one requiring that it:

(a) Be operated pursuant to law;

(b) Be approved for payment of Medicare benefits or be qualified to receive approval for payment of Medicare benefits, if so requested;

(c) Be primarily engaged in providing, in addition to room and board accommodations, skilled nursing care under the supervision of a duly licensed physician;

(d) Provide continuous twenty-four-hour-a-day nursing service by or under the supervision of a registered nurse; and

(e) Maintain a daily medical record of each patient.

(2) The definition of the home or facility may provide that the term shall not be inclusive of:

(a) A home, facility, or part of a home or facility used primarily for rest;

(b) A home or facility for the aged or for the care of drug addicts or alcoholics; or

(c) A home or facility primarily used for custodial or educational care.

E. "Hospital" may be defined in relation to its status, facilities, and available services or to reflect its accreditation by the Joint Commission on Accreditation of Healthcare Organizations.

(1) The definition of the term "hospital" shall not be more restrictive than one requiring that the hospital:

(a) Be an institution licensed to operate as a hospital pursuant to law;

(b) Be primarily and continuously engaged in providing or operating (either on its premises or in facilities available to the hospital on a prearranged basis and under the supervision of a staff of licensed physicians) medical, diagnostic, and major surgical facilities for the medical care and treatment of sick or injured persons on an in-patient basis for which a charge is made; and

(c) Provide twenty-four-hour-a-day nursing service by or under the supervision of registered nurses.

(2) The definition of the term "hospital" may state that the term shall not be inclusive of:

(a) Convalescent homes or convalescent, rest, or nursing facilities;

(b) Facilities affording primarily custodial, educational, or rehabilitory care;

(c) Facilities for the aged, drug addicts or alcoholics; or

(d) A military or veterans' hospital, a soldiers' home, or a hospital contracted for or operated by any national government or government agency for the treatment of members or ex-members of the armed forces, except for services rendered on an emergency basis where a legal liability for the patient exists for charges made to the individual for the services.

F. "Medicare" means The Health Insurance for the Aged Act, Title XVIII of the Social Security Amendments of 1965 as then constituted or later amended.

G. "Nurse" may be defined so that the description of nurse is restricted to a type of nurse, such as registered nurse or a licensed practical nurse. If the words "nurse," "trained nurse," or "registered nurse" are used without specific instruction, then the use of these terms requires the insurer to recognize the services of any individual who qualifies under the terminology in accordance with the applicable statutes or administrative rules of the licensing or registry board of the state.

H. "One period of confinement" means consecutive days of in-hospital service received as an in-patient, or successive confinements for the same or related causes when discharge from and readmission to the hospital occurs within a period of time not more than six months.

I. "Partial disability" shall be defined in relation to the individual's inability to perform one or more, but not all, of the "major," "important," or "essential" duties of employment or occupation, or in relation to a percentage of time worked, to a specified number of hours worked, or to compensation earned.

J. "Physician" may be defined by including words such as "qualified physician" or "licensed physician." The use of these terms requires an insurer to recognize and to accept, to the extent of its obligation under the contract, all providers of medical care and treatment when the services are within the scope of the provider's licensed authority and are provided pursuant to applicable laws.

K. "Preexisting condition" shall not be defined more broadly than the following: "Preexisting condition means the existence of symptoms that would cause an ordinarily prudent person to seek diagnosis, care, or treatment within a 24-month period preceding the effective date of the coverage of the insured person or a condition for which medical advice or treatment was recommended by a physician or received from a physician within a 24-month period preceding the effective date of the coverage of the insured person."

L. "Residual disability" shall be defined in relation to the individual's reduction in earnings and may be related either to the inability to perform some part of the "major," "important" or "essential duties" of employment or occupation, or to the inability to perform all usual business duties for as long as is usually required. A policy that provides for residual disability benefits may require a qualification period, during which the insured must be continuously totally disabled before residual disability benefits are payable. The qualification period for residual benefits may be longer than the elimination period for total disability. In lieu of the term "residual disability," the insurer may use "proportionate disability" or other term of similar import that in the opinion of the Superintendent adequately and fairly describes the benefit.

M. "Sickness" shall not be defined to be more restrictive than the following: "Sickness means illness or disease of an insured person."

N. "Total disability"

(1) A general definition of total disability shall not be more restrictive than one requiring that the insured, as a result of the covered sickness or accident, is unable to engage in any employment or occupation for which he or she is or becomes qualified by reason of education, training, or experience, and is not, in fact, engaged in any employment or occupation for wage or profit.

(2) Total disability may be defined in relation to the inability of the person to perform duties, but the definition must not require that an individual be unable to:

(a) Perform "any occupation whatsoever," "any occupational duty," or "any and every duty of his occupation"; or

(b) Engage in a training or rehabilitation program.

(3) An insurer may require the complete inability of the person to perform all of the substantial and material duties of his or her regular occupation or words of similar import, provided that "regular occupation" or similar words are clearly defined in the policy.

Notes

02-031 C.M.R. ch. 755, § 4