The following words and terms, when used in this chapter,
have the following meanings, unless the context clearly indicates otherwise:
Act-The Insurance Company Law of 1921
(40
P. S. §§
341-991.2361)
Applicant-The term as defined in section
1103 of the act (40 P. S. §
991.1103).
Certificate-The term as defined in section
1103 of the act.
Commissioner-The Insurance Commissioner of
the Commonwealth.
Department-The Insurance Department of the
Commonwealth.
Exceptional increase-Only those increases
filed by an insurer as exceptional for which the Commissioner determines the
need for the premium rate increase is justified.
(i) Increases due to changes in laws or
regulations applicable to long-term care coverage in this Commonwealth or due
to increased and unexpected utilization that affects the majority of insurers
of similar products.
(ii) Except as
provided in §
89a.118 (relating to premium rate
schedule increases), exceptional increases are subject to the same requirements
as other premium rate schedule increases.
(iii) The Commissioner may request a review
by an independent actuary or a professional actuarial body of the basis for a
request that an increase be considered an exceptional increase.
(iv) The Commissioner, in determining that
the necessary basis for an exceptional increase exists, will also determine
potential offsets to higher claims costs.
Functionally necessary-The term as defined
in section 1103 of the act.
Group long-term care insurance-The term as
defined in section 1103 of the act.
Incidental-As used in §
89a.118(j), means
that the value of the long-term care benefits provided is less than 10% of the
total value of the benefits provided over the life of the policy. These values
shall be measured as of the date of issue.
Long-term care insurance-The term as defined
in section 1103 of the act.
Medically necessary-The term as defined in
section 1103 of the act.
Policy-The term as defined in section 1103
of the act.
Producer-An agent as defined in section 601
of the act (40 P. S. §
231), or a
broker as defined in section 621 of the act (40 P. S. §
251).
Qualified actuary-A member in good standing
of the American Academy of Actuaries.
Qualified long-term care insurance contract
or Federally tax-qualified long-term care insurance
contract-
(i) An individual or
group insurance contract that meets all of the following requirements of
7702B(b) of the Internal
Revenue Code of 1986 (IRC) (
26 U.S.C.A. § 77026B(b)) :
(A) The only insurance protection provided
under the contract is coverage of qualified long-term care services. A contract
may not fail to satisfy the requirements of this subparagraph by reason of
payments being made on a per diem or other periodic basis without regard to the
expenses incurred during the period to which the payments relate.
(B) The contract does not pay or reimburse
expenses incurred for services or items to the extent that the expenses are
reimbursable under Title XVIII of the Social Security
Act (42 U.S.C.A. §§
1395-
1395gg g) or would be so
reimbursable but for the application of a deductible or coinsurance amount. The
requirements of this subparagraph do not apply to expenses that are
reimbursable under Title XVIII of the Social Security
Act only as a secondary
payor. A contract may not fail to satisfy the requirements of this subparagraph
by reason of payments being made on a per diem or other periodic basis without
regard to the expenses incurred during the period to which the payments
relate.
(C) The contract is
guaranteed renewable, within the meaning of section 7702B(b)(1)(C) of the
IRC.
(D) The contract does not
provide for a cash surrender value or other money that can be paid, assigned,
pledged as collateral for a loan, or borrowed.
(E) All refunds of premiums and all
policyholder dividends or similar amounts, under the contract are to be applied
as a reduction in future premiums or to increase future benefits, except that a
refund on the event of death of the insured or a complete surrender or
cancellation of the contract cannot exceed the aggregate premiums paid under
the contract.
(F) The contract
meets the consumer protection provisions in section 7702B(g) of the
IRC.
(ii) The term also
means the portion of a life insurance contract that provides long-term care
insurance coverage by rider or as part of the contract and that satisfies the
requirements of section 7702B(b) and (e) of the IRC.
Similar policy forms-All of the long-term
care insurance policies and certificates issued by an insurer in the same
long-term care benefit classification as the policy form being considered.
Certificates of groups that meet the definition in section 1103 of the act
(40
P. S. §
991.1103) are not considered
similar to certificates or policies otherwise issued as long-term care
insurance, but are similar to other comparable certificates with the same
long-term care benefit classifications. For purposes of determining similar
policy forms, long-term care benefit classifications are defined as
follows:
(i) Institutional long-term
care benefits only.
(ii)
Noninstitutional long-term care benefits only.
(iii) Comprehensive long-term care
benefits.
