HOUSE OF REPRESENTATIVES

H.B. NO.

1520

TWENTY-NINTH LEGISLATURE, 2017

H.D. 1

STATE OF HAWAII

 

 

 

 

 

 

A BILL FOR AN ACT

 

 

RELATING TO INSURANCE.

 

 

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

 


     Section 1.  The purpose of this Act is to:

     (1)  Protect consumers of limited-duration health insurance in this State;

     (2)  Establish a system of regulation over limited-duration health insurance coverage activities in this State; and

     (3)  Provide full disclosure in the sale of limited-duration health insurance coverage.

     SECTION 2.  Chapter 431, Hawaii Revised Statutes, is amended by adding a new part to article 10A to be appropriately designated and to read as follows:

"Part     .  LIMITED-DURATION HEALTH INSURANCE

     §431:10A-    Application and scope.  (a)  This part shall apply to:

     (1)  Health insurers that offer limited-duration health insurance coverage to individuals in this State; and

     (2)  Limited-duration health insurance coverage that is delivered or issued for delivery in this State, including coverage issued outside of this State that covers individuals in this State.

     (b)  A limited-duration health insurance coverage policy shall not cover any person residing in this State or be delivered or issued for delivery in this State unless the policy complies with this part.

     §431:10A-    Limited-duration health insurance coverage defined.  Limited-duration health insurance coverage means health insurance coverage provided to an individual under a contract offered by a licensed health insurer, regardless of the situs of the delivery of the policy or contract, that has a specified, limited duration and does not meet all of the requirements otherwise applicable to individual health insurance coverage.

     §431:10A-    Limited duration.  Any limited-duration health insurance coverage policy that is delivered or issued for delivery in the State shall have an expiration date in the contract that is less than ninety-one days and shall not be renewable at the option of the issuer nor the covered individual.

     §431:10A-    Disclosure requirements.  (a)  A health insurer that offers limited-duration health insurance coverage shall, in addition to all other documents required by the commissioner, deliver an outline of coverage to an applicant for or an enrollee in limited-duration health insurance coverage delivered or issued for delivery in this State.

     (b)  Any limited-duration health insurance coverage policy that is delivered or issued for delivery in this State must display prominently in any application, sales, and marketing materials provided in connection with enrollment in such coverage, in at least fourteen point type the following statement:

     "YOU MAY BE DENIED ENROLLMENT IN THIS POLICY BASED ON YOUR HEALTH STATUS."

     (c)  Any limited-duration health insurance coverage policy that is delivered or issued for delivery in this State shall display prominently in the contract, in any application, sales, and marketing materials provided in connection with enrollment in such coverage, and in the outline of coverage for such coverage, in at least fourteen point type the following statements:

     (1)  "THIS IS NOT QUALIFYING HEALTH COVERAGE ("MINIMUM ESSENTIAL COVERAGE") UNDER THE AFFORDABLE HEALTH CARE ACT.  IF YOU DON'T HAVE MINIMUM ESSENTIAL COVERAGE, YOU WON'T QUALIFY FOR A SPECIAL ENROLLMENT PERIOD TO ENROLL IN INDIVIDUAL HEALTH INSURANCE WHEN THIS COVERAGE ENDS.  THIS COVERAGE MAY HAVE SIGNIFICANT LIMITS ON BENEFITS.  PLEASE READ CAREFULLY AND COMPARE WITH OTHER HEALTH INSURANCE COVERAGE AVAILABLE IN THIS STATE."

     (2)  "THIS POLICY DOES NOT PROVIDE ALL OF THE BENEFITS PROVIDED BY INDIVIDUAL ACCIDENT AND HEALTH OR SICKNESS INSURANCE.  YOUR BENEFITS UNDER THIS POLICY ARE LIMITED.  PLEASE READ THE BENEFIT PROVISIONS AND EXCLUSIONS CAREFULLY TO DETERMINE WHETHER THIS POLICY IS APPROPRIATE FOR YOU."

     (3)  "YOUR DEDUCTIBLE AND COST-SHARING (INCLUDING COPAYMENTS AND COINSURANCE) ARE BASED ON YOUR CONTRACT PERIOD."

     (4)  "PRE-EXISTING CONDITIONS ARE NOT COVERED UNDER THIS POLICY."

     (d)  Any identification card for limited-duration health insurance coverage that is delivered or issued for delivery in this State must display prominently the following in bold type:

     "THIS IS TEMPORARY COVERAGE.  THIS POLICY PROVIDES LIMITED BENEFITS."

     §431:10A-    Forms; approval.  (a)  The forms of limited-duration health insurance policies, applications, certificates, or other evidence of insurance coverage, commission schedules, and applicable premium rates relating thereto shall be filed with the commissioner.

     (b)  No policy, contract, certificate, or other evidence of insurance, application, or other form shall be sold, issued, or used and no endorsement shall be attached to or printed or stamped thereon unless its form has been approved by the commissioner or thirty days have expired after such filing without written notice from the commissioner of disapproval.  The commissioner shall disapprove the forms for limited-duration health insurance coverage if the commissioner finds:

     (1)  That they are unjust, inequitable, misleading, or deceptive; or

     (2)  That the rates are by reasonable assumptions excessive in relation to the benefits provided.

     In determining whether the rates by reasonable assumptions are excessive in relation to the benefits provided, the commissioner shall give due consideration to past and prospective claim experience, within and outside this State, and to fluctuations in such claim experience, to a reasonable risk charge, to contribution to surplus and contingency funds, to past and prospective expenses, both within and outside this State, and to all other relevant factors within and outside this State.  In exercising the powers conferred by this part, the commissioner shall not be bound by any other requirement of this code with respect to standard provisions to be included in accident and health or sickness insurance policies or forms.

     (c)  After hearing, upon written notice, the commissioner may withdraw an approval previously given if the commissioner is of the opinion that an original submission would have been disapproved.  Such withdrawal of approval shall be effective not less than ninety days after the giving of notice of withdrawal."

     SECTION 3.  If any provision of this Act, or the application thereof to any person or circumstance, is held invalid, the invalidity does not affect other provisions or applications of the Act that can be given effect without the invalid provision or application, and to this end the provisions of this Act are severable.

     SECTION 4.  This Act shall take effect upon its approval.


 


 

Report Title:

Limited-Duration Health Insurance; Disclosure; Insurance Commissioner

 

Description:

Establishes requirements for regulation of limited-duration health insurance by the Insurance Commissioner.  Establishes maximum term, disclosure requirements, rate standards, and form approval requirements.  (HB1520 HD1)

 

 

 

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