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OFFICE OF INSURANCE REGULATION OFFICE OF INSURANCE

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					OFFICE OF INSURANCE REGULATION
   OFFICE OF INSURANCE REGULATION



              FAIR. FAST. PROFESSIONAL.


             Creditable Coverage and
                Guaranteed-Issue

                           Monica Rutkowski, Director
                         Life and Health Product Review
OFFICE OF INSURANCE REGULATION




                         HIPAA Background
            • Purpose – to curb administrative health
              care costs and reduce the number of
              uninsured;
            • Health Insurance Portability and
              Accountability Act (HIPAA) signed into law
              August 21, 1996;
            • Governs important health insurance
              continuation situations.
OFFICE OF INSURANCE REGULATION




              Creditable Coverage Defined
            • Time spent under previous coverage
              reduces waiting period for a pre-existing
              condition under a new group plan;
            • Limits waiting periods to 12 months for
              new employees, or 18 months if
              employee joins the plan at a later date;
            • A pregnant woman who joins a plan with
              2 – 50 employees does not have to fulfill
              a waiting period.
OFFICE OF INSURANCE REGULATION




            Florida Legislation Enacted
            • In 1997, Senate Bill 1682 was passed to
              match the provisions of the federal
              HIPAA;

            • Florida adopted the exact same definition
              of “creditable coverage” as HIPAA.
OFFICE OF INSURANCE REGULATION




             Creditable Coverage means…
            • Prior coverage of the individual under:
                   A group health plan;
                   Individual health insurance;
                   Medical care program of the Indian Health
                    Services or tribal organization;
                   Florida Comprehensive Health Association or
                    other state risk pool;
                   Medicare;
                   Medicaid;
                   A health benefit plan of the Peace Corps.
OFFICE OF INSURANCE REGULATION




                 Alternative Mechanisms
            • Access to a conversion policy;
            • Group insurers offering a conversion must offer
              at least two different policy forms, rates capped
              at 200%;
            • HMO premium rates on conversion policies
              capped at 200% of the standard risk rate;
            • Individual insurers must offer at least two
              different policy forms with no capped rate;
            • Section 627.6699(11), F.S. created a
              “reinsurance pool” option;
            • No insurers are taking advantage of the
              reinsurance option at this time.
OFFICE OF INSURANCE REGULATION


                              What’s NOT
                          Creditable Coverage
            • Accident or disability income;
            • Liability insurance and supplements to liability
               insurance;
            • On-site medical clinics, prepaid health clinics;
            If offered separately:
            • Dental, vision, long term care, nursing home
               care, home health care, community based care
               or any combination thereof;
            • Specified disease, hospital indemnity Medicare
               Supplement, including coverage provided under
               a Group.
OFFICE OF INSURANCE REGULATION




                 Responsibilities of Insurer
            • Rule 69O-154, F.A.C. revisions adopted
              September 19, 2000;
            • Issue a certificate of creditable coverage;
            • Establish procedures for providing certificates
              automatically, without charge;
            • Certificate must read as on adopted Form OIR-
              1361 (rev. 10/98);
            • A separate certificate must be issued for
              dependents not residing with the insured;
            • When prior coverage is Group, and includes
              vision or dental, it is considered creditable
              coverage for those lines of business.
OFFICE OF INSURANCE REGULATION



                 Establishing Creditable Coverage
                       Without a Certificate

            • Insured can “attest” to coverage;
            • Present corroborating evidence and cooperate
              with the insurer’s efforts to verify coverage;
            • Acceptable documentation includes:
                     Extension of Benefits (EOB’s);
                     Pay stubs;
                     Health ID card;
                     Certificate of coverage under a Group plan;
                     Records of health providers indicating health coverage;
                     Third party statements;
                     Any other relevant documents that evidence periods of
                      health coverage.
OFFICE OF INSURANCE REGULATION


                            Guaranteed-Issue
                            Group Health Plans
            • Employers with 1 to 50 employees have
              access to guaranteed-issue group plans;
            • One-life groups may enroll in August each
              year, with an effective date of October 1;
            • Insurers must offer employers the option
              of purchasing a basic or standard plan;
            • Mini-COBRA, available to employers with
              20 or fewer lives, must be exhausted
              before a conversion can be offered.
OFFICE OF INSURANCE REGULATION


                       Guaranteed-Issue
                    Out-of-State Association
            • Terminating individuals are eligible for a
              conversion policy;
            • The Certificate of Insurance the individual
              receives at issuance will contain the
              conversion option information;
            • Existing law requires the information to
              be contained in the coverage document.
OFFICE OF INSURANCE REGULATION


                              Who qualifies for
                             guaranteed-issue?
            • Previously held coverage under an employer
              group health plan, governmental or church plan;
            • Exhausted all COBRA or Mini-COBRA;
            • Had 18 months of coverage with no “break in
              coverage” for a period greater than 63 days;
            • Insurer withdrew from an area;
            • Credit for prior coverage;
            • Coverage for a pre-existing condition;
            • Coverage for a new born or newly adopted child.
OFFICE OF INSURANCE REGULATION




                          Community Rating
            • Individuals are charged the same rate indifferent
              of their individual risk characteristics;
            • Small group law provides modified community
              rating with factors of age, gender, county
              location, family composition, tobacco usage,
              coverage and limited adjustments for claims
              experience and administrative costs;
            • Rates for Group conversion allow only age,
              gender and coverage.
OFFICE OF INSURANCE REGULATION




                    Guaranteed-Issue Rates
            •   Insured qualifies without underwriting;
            •   Coverage cannot be denied;
            •   Group conversion is an example;
            •   Guaranteed-issue does not imply
                community rating. Rates can and usually
                do vary by age, gender, area, etc.

				
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posted:10/23/2012
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