Health specific Laws Flashcards
Medicare supplement insurance:
medicare supplement insurance must
prominently disclose that the policyholder has the right to return the policy or certificate within 30 days of its delivery for a full refund of premium if the insured is not satisfied for any reason.
Preexisting conditions:
A medicare Supplement may not
deny coverage for preexisting conditions for more than 6 months after the effective date of coverage.
1 time in lifetime
In home sales
A producer selling a medicare supplement in a purchaser’s home must
give the purchaser his/her name, address, and telephone number, and the insurer’s name
Complete, in the purchaser’s presence, a Policy Checklist in duplicate. The Policy checklist must be signed and given to the purchaser and insurer. The insurer must maintain a copy on file at its administrative office.
An insurer providing Medicare Supplements must:
Annually file its rates, rating schedule, and other documentation demonstrating that it complies with loss ratio standards of Illinois
Submit a copy of any Medicare Supplement advertisement to the Director for review
An advertisement describing Medicare must
State that the insurer and agent are not connected with the Medicare program
Disclose that it is an insurance advertisement
Identify the insurer’s actual address
Indicate that a failure to respond will not jeopardize medicare coverage
State if one of the insurer’s representatives will deliver any material or information in person
A medicare supplement may not:
Limit or exclude coverage more restrictively than Medicare does except for preexisting conditions
Use waivers to exclude, limit, or reduce coverage or benefits for specifically named preexisting diseases or physical conditions.
Duplicate benefits provided by Medicare
A medicare supplement insurer may not deny coverage to an applicant
under 65 years of age who meets any of the following criteria:
Becomes eligible for Medicare by reason of disability if the person makes application for a Medicare supplement policy within 6 months of the first day on which the person enrolls for benefits under Medicare Part B.
Has Medicare and an employer group health plan that terminates or ceases to provide all such supplemental health benefits
Is insured by a Medicare Advantage or medicare supplement policy and the insurer goes out of business, withdraws from the market, or the insurer or agents misrepresent the plan and the applicant is without coverage
Benefit standards:
A medicare supplement must
Coincide with any changes in the applicable Medicare deductible amount and copayment percentage factors Be guaranteed renewable: increase premium by a class but must renew
A medicare supplement may not
Exclude or limit coverage for preexisting conditions for more than 6 months after the effective date of coverage
Define the term preexisting condition more restrictively than a condition for which medical advice was given or treatment was recommended by or received from a physician within 6 months before the effective date of coverage
Indemnify against losses resulting from sickness on a different basis than losses resulting from accidents
Terminate spousal coverages solely because the insured’s coverage terminates, except for nonpayment of premium
An insurer may not cancel or nonrenew a Medicare Supplement
Solely because of an individuals health status
For any reason other than nonpayment of premium or material misrepresentation
Long-Term Care insurance
any health policy or rider advertised, marketed, offered, or designed to provide coverage for at least
12 consecutive months for each covered person
Traditional Long-term care
Preexisting condtions
A Long-term care policy may not
deny coverage for preexisting conditions for more than 6 months after the effective date of coverage.
Prohibited provisions
An LTC policy may not
Be terminated on the grounds of the insured’s age or deterioration in health
Establish a new waiting period when converting or replacing coverage within the same company, except for a benefit increase that the insured voluntarily selects
Cover skilled nursing care only or provide significantly more coverage for skilled care in a facility than coverage for lower levels of care.
prior institutionalization
An LTC policy may not:
Condition eligibility for any benefits on a prior hospitalization requirement
Condition eligibility for benefits provided in an institutional care setting on the receipt of a higher level of institutional care.
Condition eligibility for any benefits other than waiver of premium, post-confinement, post-acute care, or recuperate benefits on prior institutionalization.
Require a prior institutional stay of more than 30 days if conditioning eligibility for noninstitutional benefits on the prior receipt of institutional care
Condition eligibility for benefits upon admission to a facility for the same or related condition within fewer than 30 days after discharge from the institution if providing benefits only following institutionalization.
The free-look period on LTC policies is
30 days, subject to a premium refund
An outline of coverage must
be delivered to an applicant during the initial solicitation.
An LTC policy must be delivered to the
applicant within 30 days after the underwriter date of approval. Claim denial must be accompanied by written reasons for denial.
Illinois long-term are partnership program
The Illinois long-term care partnership program is administered by the department of healthcare and family services with the assistance of the department of insurance to do the following
provide incentives for individuals to insure against the costs of providing for their LTC needs
Provide a mechanism for individuals to qualify for coverage of the cost of their LTC needs under medicaid without first being required to exhaust their assets.
Provide counseling services to individuals planning for their LTC needs
Alleviate the financial burden on the State’s medical assistance program by encouraging the pursuit of private initiatives
dollar for dollar benefit payout
If an individual is a beneficiary of the Partnership certified policy
the total assets an individual owns and may retain under medicaid and still qualify for benefits under Medicaid at the time the individual applies for LTC benefits increased by $1 for each $1 of benefit paid out under the individual’s certified policy
Advertising: Form and Content
A health policy’s ad format and content must
be complete and clear and avoid deception. The Director determines whether an ad has the capacity or tendency to mislead or deceive.
No ad may use words or phrases in a manner
that exaggerates any benefits beyond the terms of the policy
Testimonials and endorsements must
be genuine, up to date, and authorized by the endorser
Advertisement may
not make comparisons that are unfair or disparaging to other organizations.
Record Keeping
Each insurer must keep all ads on file in its office for
4 years or until the next Department examination. Also, each insurer must file a certificate of compliance with ad regulations with its annual statement.
minimum standards for individual policies:
Prohibited provisions
No individual policy may
establish a waiting period, except for sickness (30 days) or non-emergency hernia, varicose veins, adenoids, appendix and tonsils (6 months).
Accident policies may not
contain a probationary or waiting period
A policy may be issued as a dividend only if
an equivalent cash payment is offered to the policyholder as an alternative to such dividend policy or rider. No such dividend may be issued for an initial term of less than 6 months.
A disability policy, hospital confinement indemnity policy or specified disease policy may contain a cash value benefit only if it
provides return of 100% of all premiums paid, less the claims incurred, by the time the insured attains age 65.
Benefit standards
A guaranteed or non-cancelable policy may not
terminate coverage for a spouse except for nonpayment premium
Basic hospital expense coverage must provide
at least 80% of the charges for semi-private room accommodations, or $100 per day (may be reduced to $70 outside the metropolitan area).
Basic Medical-surgical expense coverage must
provide for no less than 80% of the reasonable charges.
Major Medical Expense Coverage may provide
an aggregate maximum of no less than 10,000
Accident only coverage must
provide accidental death and double dismemberment benefits of at least 1,000, with single dismemberment at least 500.
Disclosure
The individual policy must state:
Right of return for full premium for any reason (free look) within 10 days
A renewal, continuation, or nonrenewal provision on the first page
Preexisting condition limitations, if any
That it does not cover sickness, if it is an accident only policy
A rider or endorsement reducing coverage must
be signed by the policyholder in order to be valid if added after the issue date
An outline of coverage must
be delivered to all applicants
Detail the policy’s coverages, terms, renewability, expectations, reductions, and limitations
State the insurer’s name and address
Replacement
An application must
determine whether coverage is intended to replace another healthy policy in force.
If a sale involves replacement, the insurer must
give the applicant a Notice Regarding Replacement, before issuing or delivering the policy, which states that certain factors may affect the protection available under the new policy, including preexisting conditions
Group insurance
Discontinuance and replacement
Group policies issued in Illinois must
provide a reasonable extension of benefits and benefits payable under such extension may be subject to the policy’s regular benefit limits.
An insurer who is discontinuing a group policy, shall
notify persons of the discontinuance effective date an encourage them to avail themselves of any contract rights.
A group policy replacing a discontinued policy shall
cover all persons who are covered under the plan being replaced.
The replaced insurer shall
be liable only for its accrued liabilities and extension of benefits.
The prior insurer shall
provide extension of benefits for an insured’s disabling condition when no coverage is available under the succeeding insurer’s plan
Extension of benefits
For hospital and medical expenses coverages and HMO plans, other than dental, pharmaceutical or other limited expense coverages, such extension will be
considered ‘reasonable’ if it extends coverage until the earliest of the following:
The end of 12 months or
the date the maximum benefit is reached or
the end of total disability
For other types of hospital or medical expenses plans, such as
those limited to hospital expenses only, medical expenses only, or surgical expenses only, such an extension will be considered reasonable if it extends coverage until the earliest of the following:
90 days or
the date the maximum benefit is reached or
the end of total disability
An extension of benefits need not
be provided when an individuals coverage terminates under the group contract in accordance with the contract’s eligibility and termination provisions.
Total disability means
A covered person’s inability to perform his/her regular or customary occupational duties because of injury or disease
After benefits have been paid for 24 months, the covered person cannot perform the duties of any gainful occupation for which he/she is reasonably fitted by training, education, or experience
For dependents or retired employees, the inability because of injury or disease to engage in substantially all of the normal activities of a person in good health of like age and sex
If a policy is discontinued because of non-payment of premium, the insurer shall
still be liable for valid claims incurred prior to the end of the grace period.
The discontinuance effective date shall not
be prior to midnight at the end of the third scheduled word day after the date upon which the discontinuance notice is delivered.
Requirements for notice of discontinuance
Covered individuals must
be notified within 10 working days of the policy owner being notified of discontinuance, and advised that the insurer will not be liable for claims incurred after the discontinuance date.
If the premium for the group plan being discontinued involve employee contributions and the policy holder continued to collect such contributions after the discontinuance date, the employer
shall be solely liable for benefits applicable to the period for which employee contributions were collected
Unfair practices
Discrimination
insurers may not discriminate between individuals of the same risk class in regards to:
policies issued, renewed, or cancelled The amount of premiums or rates charged the benefits payable any of the terms or conditions any other manner whatsoever
Insurers are not prohibited from providing
incentives for insureds to use the services of a particular hospital or person
Further, the terms “physician” or “doctor” shall include
persons licensed to practice dentistry under the Illinois Dental practice act
No company, in any accident or health policy shall
make or permit any distinction or discrimination against individuals solely because handicaps or disabilities, except where the distinction or discrimination is based on sound actuarial principles or is related to actual or reasonably anticipated experience.
No company shall refuse to insure, nor limit the
coverage extent or amount available to an individual, or charge an individual a different rate for the same coverage solely because of blindness or partial blindness.
persons who are blind or partially blind shall
be subjected to the same standards of sound actuarial principle or actual or reasonably anticipated experience as are sighted persons.
Refusal to insure includes
an insurer’s denial of disability insurance coverage on the grounds that the policy defines “disability” as being presumed in the event that the insured loses his or her eyesight.
a qualified clinical cancer trial payment may not be based, in whole or in part,
on the person’s having or not having coverage for routine patient care under a group policy.
Coverage is not required for out of network services
where the underlying health benefit plan does not provide for such services.
routine patient care means all health care services which would
normally be provided outside of a qualified cancer trial
routine patient care does not include, and a group policy may exclude coverage for:
a health care service item or drug that is the subject of the qualified cancer trial
A health care service, item, or drug provided solely to satisfy qualified cancer trial’s data collection and analysis needs
An investigational drug or device that has not been approved for market by the US FDA
Transportation, lodging, food, or other expenses for the patient, a family member, or companion of the patient that are associated with the qualified clinical cancer trial, unless the policy normally covers these expenses
A health care service, item, or drug customarily provided by the qualified clinical caner trial sponsors free of charge for any patient
A health care service or item, which is otherwise specifically excluded from coverage
Costs for services, items, or drugs that eligible for reimbursement from a source other than a patient’s health policy
costs associated with approved cancer clinical trials designed exclusively to test toxicity or disease pathophysiology, unless the policy normally covers these expenses
Illinois health insurance portability and accountability act (HIPPA), which applies to healthy policies and services in Illinois supersedes
any conflicting, inconsistent, or less restrictive legal standards or requirements
A group health plan may impose
a preexisting condition exclusion for a period of not more than 12 months (or 18 months in the case of late enrollee) after enrollment, reducible by any applicable creditable coverage (prior coverage which ended less than 63 days before the enrollment date of the new policy)
Pregnancy and genetic info may not
be classified as preexisting condition
Discrimination is prohibited on the basis of
health status medical condition claims experience receipt of health care medical history genetic information evidence of insurability disability
group plans are
guaranteed renewable
Managed care
An organization formed to provide health care plans
under a system that causes any health care risk to be borne by the organization or its providers.
An HMO must:
Maintain a process for resolving grievances about its health care delivery system and its operation
submit its grievance process to the Director for pre approval
maintain a record of each filed grievance for at least 3 years after its resolution
Authorize a grievance committee, which must hear and resolve submitted grievances within 60 days of receipt
Have a complaint resolution procedure
Respond to a complaint received by the Department within 21 days after receiving notice of the complaint
Issue a contract or other evidence of coverage to each subscriber or enrollee
Issue a contract or other evidence of coverage to each subscriber or enrollee
Provide coverage for mental and emotional disorders
An HMO may not cancel a contract because of
the enrollee’s health status or use of the HMO’s grievance system
A contract issued by an HMO may not restrict services because
the enrollee or any covered dependent receives medicaid benefits
An HMO must cover the
full expense, without applying a deductible or coinsurance, of any medical examination of a victim of sexual assault
Group contracts must be
renewable and must provide health care services for at least 12 months.
However, the HMO may nonrenew the contract by
giving the contract owner at least 31 days written notice
HMO producers must meet
licensure requirements
Illinois health maintenance organization guaranty association
The association protects of HMO health care plans against
insurer insolvency
All insurers authorized to sell HMO policies must
be members of the association
If a member becomes insolvent,
the other members are assessed the necessary funds to cover the insolvent insurer’s claims
The Association may not be held liable for more than
the insolvent insurer’s contractual obligations, up to 500,000
Limited health service organization (LHSO) is an organization providing
limited health care plans under whose risk is borne by the organization or its providers
Limited Health services available through an LHSO include
Ambulance Dental Vision care services Pharmaceutical services Clinical laboratory services Podiatry care
An LHSO must issue each subscriber or enrollee a
group contract or evidence of coverage within 30 days from the effective date or the date that the organization is notified of the its enrollment
Group contracts must be
renewable and must provide limited health services for at least 12 months. however the LHSO may nonrenew the contract or other evidence of coverage by giving the contract or certificate owner at least 31 days written notice.
The complaint procedure for LHSO’s is the complaint procedure for
HMO’s
A person soliciting LHSO coverage must hold
either a limited insurance representative’s license or a health producer’s license
The director may require an LHSO to submit
ads for approval 30 days before use for 12 months if the LHSO has used a false or misleading ad.
