Utah Admin. Code R590-146-8 - Benefit Standards for 1990 Standardized Plans Issued for Delivery on or After July 30, 1992, and with an Effective Date for Coverage Prior to June 1, 2010

A policy or certificate may not be advertised, solicited, delivered, or issued for delivery in this state as a 1990 plan unless it complies with the standards in this section. A 1990 plan may not be offered for sale on or after June 1, 2010.

(1) General Standards. The general standards in this subsection apply to a 1990 plan, in addition to any other requirement of this rule.

(a) A policy or certificate may not exclude or limit benefits for losses incurred more than six months after the effective date of coverage for a preexisting condition.

(b) A policy or certificate may not indemnify against losses resulting from sickness on a different basis than losses resulting from accidents.

(c) A policy or certificate shall provide that benefits designed to cover cost sharing amounts under Medicare will be changed automatically to coincide with any changes in the applicable Medicare deductible, copayment, or coinsurance amounts. Premiums may be modified to correspond with such changes.

(d) A policy or certificate may not provide for termination of coverage of a spouse solely because of an event specified for termination of coverage of the insured, other than the nonpayment of premium.

(e) A policy shall be guaranteed renewable.

(i) An issuer may not cancel or nonrenew a policy solely on the grounds of the health status of an insured.

(ii) An issuer may not cancel or nonrenew a policy for any reason other than nonpayment of premium or material misrepresentation.

(iii) If a group policyholder terminates a policy and the policy is not replaced, the issuer shall offer each certificate holder a policy that, at the option of the certificate holder, provides for:

(A) continuation of the benefits contained in the group policy; or

(B) an individual policy with benefits that otherwise meet the requirements of this subsection.

(iv) If a certificate holder in a group terminates membership in the group, the issuer shall:

(A) offer the certificate holder a conversion opportunity; or

(B) at the option of the group policyholder, offer the certificate holder continuation of coverage under the group policy.

(v) If a group policy is replaced by another group policy purchased by the same policyholder, the issuer of the replacement policy shall offer coverage to each insured covered under the prior group policy on its date of termination. Coverage under the new group policy may not result in an exclusion for a preexisting condition that would have been covered under the prior group policy.

(vi) If a policy eliminates an outpatient prescription drug benefit due to requirements imposed by the Medicare Prescription Drug, Improvement and Modernization Act of 2003, the modified policy satisfies the guaranteed renewal requirements of this subsection.

(f)

(i) Termination of a policy or certificate shall be without prejudice to any continuous loss that started while the policy or certificate was in force.

(ii) The extension of benefits beyond the period during which the policy was in force may be conditioned upon the continuous total disability of the insured, limited to:

(A) the duration of the policy benefit period, if any; or

(B) payment of the maximum benefits.

(iii) Receipt of Medicare Part D benefits may not be considered in determining a continuous loss.

(g)

(i)

(A) A policy or certificate shall provide that benefits and premiums be suspended at the request of the policyholder or certificate holder for a period, not to exceed 24 months, in which the policyholder or certificate holder has applied for and is determined to be entitled to medical assistance under Title XIX of the Social Security Act, if the policyholder or certificate holder notifies the issuer of the policy or certificate within 90 days after the date the insured becomes entitled to assistance.

(B) If the policy or certificate is suspended and the policyholder or certificate holder loses entitlement to medical assistance, the policy or certificate shall be automatically reinstated, effective on the date medical assistance terminated if the policyholder or certificate holder provides notice of loss of entitlement within 90 days after the date of loss and pays the required premium.

(ii)

(A) A policy shall provide that benefits and premiums under a policy be suspended, for the period provided by federal regulation, at the request of the policyholder if the policyholder is entitled to benefits under Section 226(b) of the Social Security Act and is covered under a group health plan, as defined in Section 1862(b)(1)(A)(v) of the Social Security Act.

(B) If suspension occurs and if the policyholder or certificate holder loses coverage under the group health plan, the policy or certificate shall be automatically reinstated, effective on the date of loss of coverage, if the policyholder or certificate holder provides notice of loss of coverage within 90 days of the loss.

(iii) Reinstated coverage:

(A) may not include a preexisting condition waiting period;

(B)

(I) shall provide for resumption of coverage substantially equivalent to the coverage in effect before the date of suspension; and

(II) if the suspended policy or certificate provided coverage for outpatient prescription drugs, the reinstated policy for Medicare Part D enrollees may not include coverage for outpatient prescription drugs and shall otherwise provide substantially equivalent coverage to the coverage in effect before the date of suspension; and

(C) shall classify premiums on terms at least as favorable to the policyholder or certificate holder as the premium classification terms that applied had the coverage not been suspended.

(h) If an issuer makes a written offer to a policyholder or certificate holder to exchange a policy or certificate during a specified period from their 1990 plan to a 2010 plan, the offer and subsequent exchange shall comply with the requirements of this subsection:

(i) an issuer is not required to provide justification to the commissioner if an insured replaces a 1990 plan with an issue age rated 2010 plan at the insured's original issue age and duration;

(ii) if an insured's policy or certificate to be replaced is priced on an issue age rate schedule at the time of such offer, the rate charged to the insured for the new exchanged policy shall recognize the policy reserve buildup, due to the pre-funding inherent in the use of an issue age rate basis, for the benefit of the insured;

(iii) the rating class of the new policy or certificate shall be the class closest to the insured's class of the replaced coverage;

(iv) an issuer may not apply a new preexisting condition limitation or a new incontestability period to the new policy for those benefits contained in the exchanged 1990 plan, but may apply a preexisting condition limitation of no more than six months to any added benefits not contained in the exchanged policy; and

(v) the new policy or certificate shall be offered to each policyholder or certificate holder within a given plan, except when the offer or issue would be in violation of state or federal law.

(2) Standards for 1990 Plans A through J.

(a) An issuer shall offer to an applicant a policy or certificate that only includes the basic core benefits, Plan A. An issuer may offer any other 1990 plan, but not in lieu of Plan A.

(b) In addition to the basic core benefits, the benefits in this subsection shall be included in Plans B through J, only as provided in Section R590-146-9:

(i) 100% of the Medicare Part A deductible;

(ii) skilled nursing facility care;

(iii) 100% of the Medicare Part B deductible;

(iv) 80% of the Medicare Part B excess charges;

(v) 100% of the Medicare Part B excess charges;

(vi) basic outpatient prescription drug benefit;

(vii) extended outpatient prescription drug benefit;

(viii) medically necessary emergency care in a foreign country benefit;

(ix) preventive medical care benefit; and

(x) at-home recovery benefit.

(3) Standardized Plan K shall only include coverage for:

(a) 100% of the Medicare Part A hospital coinsurance amount for each day used from the 61st through the 90th day in any Medicare benefit period;

(b) 100% of the Medicare Part A hospital coinsurance amount for each Medicare lifetime inpatient reserve day used from the 91st through the 150th day in any Medicare benefit period;

(c) upon exhaustion of the Medicare hospital inpatient coverage, including the lifetime reserve days, 100% of the Medicare Part A eligible expenses for hospitalization paid at the applicable prospective payment system rate, or other appropriate Medicare standard of payment, subject to a lifetime maximum benefit of an additional 365 days, which the provider shall accept the issuer's payment as payment in full and may not bill the insured for any balance;

(d) 50% of the Medicare Part A deductible until the out-of-pocket limitation is met;

(e) 50% of the skilled nursing facility care of the coinsurance amount until the out-of-pocket limitation is met;

(f) 50% of the hospice care coverage cost sharing for all Medicare Part A eligible expenses and respite care until the out-of-pocket limitation is met;

(g) 50%, under Medicare Part A or B, of the reasonable cost of the first three pints of blood, or equivalent quantities of packed red blood cells, as defined under federal regulations, unless replaced in accordance with federal regulations until the out-of-pocket limitation is met;

(h) except for coverage provided in Subsection (3)(i), 50% of the cost sharing otherwise applicable under Medicare Part B after the insured pays the Medicare Part B deductible until the out-of-pocket limitation is met;

(i) 100% of the cost sharing for Medicare Part B preventive services after the insured pays the Medicare Part B deductible; and

(j) 100% of all cost sharing under Medicare Part A and B for the balance of the calendar year after the insured has reached the out-of-pocket limitation on annual expenditures under Medicare Part A and B of $4,000 in 2006, as specified by the Secretary.

(4) Standardized Plan L shall only consist of:

(a) the benefits under Subsections (3)(a), (3)(b), (3)(c), and (3)(i);

(b) the benefits under Subsections (3)(d), (3)(e), (3)(f), (3)(g), and (3)(h), substituting 75% for 50%; and

(c) the benefit under Subsection (3)(j), substituting $2,000 for $4,000.

Notes

Utah Admin. Code R590-146-8

Amended by Utah State Bulletin Number 2019-13, effective 6/7/2019 Adopted by Utah State Bulletin Number 2024-16, effective 8/7/2024