Part 1.
TEXAS DEPARTMENT OF INSURANCE
Chapter 3.
LIFE, ACCIDENT AND HEALTH INSURANCE AND ANNUITIES
Subchapter T. MINIMUM STANDARDS FOR MEDICARE SUPPLEMENT POLICIES
28 TAC §§3.3303 - 3.3309, 3.3312, 3.3320, 3.3322, 3.3324, 3.3325
The Commissioner of Insurance adopts amendments to §§3.3303
- 3.3309, 3.3312, 3.3320, 3.3322, 3.3324, and 3.3325 concerning minimum standards
for Medicare supplement policies. Sections 3.3305, 3.3306, 3.3308, 3.3312
and 3.3322 are adopted with changes to the proposed text as published in the
November 26, 2004, issue of the
Texas Register
(29
TexReg 10873). Sections 3.3303, 3.3304, 3.3307, 3.3309, 3.3320, 3.3324, and
3.3325 are adopted without changes.
These amendments are necessary to implement provisions of the Medicare
Prescription Drug, Improvement, and Modernization Act of 2003 (MMA), as well
as to make under age 65 persons losing eligibility for health benefits under
Medicaid eligible for guaranteed issuance of Medicare supplement Plan A. After
December 31, 2005, the MMA prohibits issuers of Medicare supplement policies
from renewing outpatient prescription drug benefits for both prestandardized
and standardized Medicare supplement policyholders who enroll in Medicare
Part D.
Section 3.3303 revises definitions to conform to the MMA, as does §3.3304.
Section 3.3305 alters requirements for issuance and renewability of plans
including an outpatient prescription drug benefit to conform to the MMA. Section
3.3306 revises minimum benefit standards to conform to the MMA and the phase-out
of the existing forms of outpatient prescription drug benefits; revises payment
standards for Medicare Part A expenses; and defines the benefits included
in new Plans K and L. Section 3.3307 amends loss ratio standards for HMOs
to conform to the MMA. Section 3.3308 requires issuers to comply with notice
requirements of the MMA. Section 3.3309 revises standards for applications
in accordance with the MMA. Section 3.3312 changes standards for guaranteed
issuance to conform to the MMA and makes under age 65 individuals losing eligibility
for health benefits under Medicaid eligible for guaranteed issuance of Medicare
supplement Plan A. Section 3.3320 prohibits issuing Medicare supplement coverage
to an individual enrolled in Medicare Part C unless the effective date is
after the termination of the Part C coverage. Section 3.3322 makes changes
to filing requirements to conform to the MMA. Section 3.3324 adds §3.3312
to the list of exceptions to an issuer's authority to apply a preexisting
condition provision. Section 3.3325 addresses the effect of out-of-network
expenses on out-of-pocket annual limits in Plans K and L and makes other changes
to conform to the MMA. The department added language to §3.3312, in response
to comments, to clarify which products are guaranteed issue for eligible persons
under 65 years of age losing eligibility for Medicaid. In §§3.3305,
3.3306, 3.3308 and 3.3322 the department has made minor changes to correct
form, typographical errors and update and correct citations.
General: Commenters have made several suggestions regarding the effective
date of the rules and their effect on a carrier's ability to offer and issue
certain plans. Some commenters requested that the department revise the rules
to permit insurers to continue to use currently approved forms as appropriate
through December 31, 2005. Another commenter requested that the rules specify
that insurers may begin to offer plans with the newly adopted changes prior
to January 1, 2006, subject to approval by the Commissioner of Insurance.
Agency Response: While the department declines to revise the proposal in
the manner requested by commenters, the department does confirm that insurers
can continue to use currently approved plans as appropriate, reminding carriers
of their obligation to offer the standard plans which include prescription
drugs until the advent of Medicare Part D prescription drug coverage. The
department also confirms that, once the adopted rules take effect and prior
to January 1, 2006, insurers may offer approved plans as authorized by these
rules.
§3.3312(b)(8): Some commenters expressed concern that the proposed
amendment providing guaranteed issue rights to Medicare recipients losing
Medicaid eligibility would allow the newly-eligible individuals access to
Plans A, B, C, and F.
Agency Response: Texas law guarantees to Medicare recipients under the
age of 65 access only to Plan A. Staff has had several discussions with the
commenters, as well as with the National Association of Insurance Commissioners
(NAIC), the Center for Medicare and Medicaid Services, and the Texas Health
and Human Services Commission staff regarding this issue. The department has
added language to §3.3312(c) to clarify that an under 65 Medicare recipient
losing coverage under Medicaid would be entitled only to guaranteed issuance
of Plan A.
For, with changes: America's Health Insurance Plans, Texas Association
of Life and Health Insurers, and UnitedHealth Group. Against: None.
The amendments are adopted under the Insurance Code §1652.051
(formerly Article 3.74, §2(f)) and §1652.005 (formerly Article 3.74, §10),
and §36.001. Section 1652.051 provides that the department's rules must
include requirements that are at least equal to those required by federal
law, rules, and standards, including 42 U.S.C. §1395ss. Section 1652.005
provides that the department shall adopt rules in accordance with federal
law applicable to the regulation of Medicare supplement insurance coverage
that are necessary for the state to obtain or retain certification as a state
with an approved regulatory program under 42 U.S.C. §1395ss, as well
as any other reasonable rules that are necessary and proper to carry out this
article. Section 36.001 provides that the Commissioner of Insurance may adopt
any rules necessary and appropriate to implement the powers and duties of
the Texas Department of Insurance under the Insurance Code and other laws
of this state.
§3.3305.Policy Provisions.
(a)
Except for permitted pre-existing condition clauses described
in §3.3306(1)(A) of this title (relating to Minimum Benefit Standards),
no policy or certificate may be advertised, solicited, or issued for delivery
in this state as a Medicare supplement policy if the policy or certificate
contains limitations or exclusions on coverage that are more restrictive than
those of Medicare.
(b)
No Medicare supplement policy or certificate may use waivers
to exclude, limit, or reduce coverage or benefits for specifically named or
described preexisting diseases or physical conditions.
(c)
No Medicare supplement policy, contract, or certificate
in force in this state shall contain benefits which duplicate benefits provided
by Medicare.
(d)
Subject to §3.3306(1)(D) and (E) of this title, a
Medicare supplement policy with benefits for outpatient prescription drugs
in existence prior to January 1, 2006, shall be renewed for current policyholders
who do not enroll in Part D at the option of the policyholder.
(e)
A Medicare supplement policy with benefits for outpatient
prescription drugs shall not be issued after December 31, 2005.
(f)
After December 31, 2005, a Medicare supplement policy with
benefits for outpatient prescription drugs may not be renewed after the policyholder
enrolls in Medicare Part D unless:
(1)
the policy is modified to eliminate outpatient prescription
coverage for expenses of outpatient prescription drugs incurred after the
effective date of the individual's coverage under a Part D plan; and
(2)
premiums are adjusted to reflect the elimination of outpatient
prescription drug coverage at the time of Medicare Part D enrollment, accounting
for any claims paid, if applicable.
§3.3306.Minimum Benefit Standards.
No insurance policy, subscriber contract, certificate, or evidence
of coverage may be advertised, solicited, or issued for delivery in this state
as a Medicare supplement policy unless the policy, contract, certificate,
or evidence of coverage meets the applicable standards in paragraphs (1) -
(3) of this section. These are minimum standards and do not preclude the inclusion
of other provisions or benefits which are not inconsistent with these standards.
(1)
General standards. The following standards apply to Medicare
supplement policies and are in addition to all other requirements of this
subchapter, the Insurance Code, Article 3.74, and any other applicable law.
(A)
A Medicare supplement policy shall not exclude or limit
benefits for losses incurred more than six months from the effective date
of coverage because they involved a preexisting condition. The policy or certificate
may not define a preexisting condition more restrictively than a condition
for which medical advice was given or treatment was recommended by or received
from a physician within six months before the effective date of coverage.
(i)
If a Medicare supplement policy or certificate replaces
another Medicare supplement policy or certificate, the replacing issuer shall
waive any time periods applicable to preexisting condition waiting periods,
elimination periods, and probationary periods in the new Medicare supplement
policy or certificate to the extent such time was spent under the original
policy.
(ii)
If a Medicare supplement policy or certificate replaces
another Medicare supplement policy or certificate which has been in effect
for at least six months, the replacing policy or certificate shall not provide
any time period applicable to preexisting conditions, waiting periods, elimination
periods and probationary periods for benefits.
(iii)
If a Medicare supplement policy or certificate is issued
to an applicant who qualifies under §3.3312(b) of this title (relating
to Guaranteed Issue for Eligible Persons) or §3.3324(a) of this title
(relating to Open Enrollment), the issuer shall reduce the period of any preexisting
condition exclusion as required by §3.3312(a)(2) of this title and §3.3324(c)
and (d) of this title.
(B)
A Medicare supplement policy may not indemnify against
losses resulting from sickness on a different basis than losses resulting
from accidents.
(C)
A Medicare supplement policy 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 amount
and copayment percentage factors. Premiums may be modified to correspond with
such changes.
(D)
No Medicare supplement policy shall provide for termination
of coverage of a spouse solely because of the occurrence of an event specified
for termination of coverage of the insured, other than the nonpayment of premium,
or be cancelled or nonrenewed by the insurer solely on the grounds of deterioration
of health.
(E)
Each Medicare supplement policy shall be guaranteed renewable
and shall comply with the provisions of clauses (i) - (v) of this subparagraph.
(i)
The issuer shall not cancel or nonrenew the policy for
any reason other than nonpayment of premium or material misrepresentation.
(ii)
If the Medicare supplement policy is terminated by the
group policyholder and is not replaced as provided in clause (iv) of this
subparagraph, the issuer shall offer certificate holders Medicare supplement
coverage which provides benefits as set out in subclause (I) or (II) of this
clause, as follow:
(I)
an individual Medicare supplement policy which (at the
option of the certificate holder):
(-a-)
provides for continuation of the benefits contained in
the group policy; or
(-b-)
provides for benefits that otherwise meet the requirement
of this paragraph; or
(II)
continuation of benefits under the group plan until there
are no longer any certificate holders remaining who have opted for continuation
of benefits under the group policy terminated by the policyholder.
(iii)
If an individual is a certificate holder in a group Medicare
supplement policy and the individual terminates membership in the group, the
issuer shall:
(I)
offer the certificate holder conversion opportunity described
in clause (ii) of this subparagraph; or
(II)
at the option of the group policyholder, offer the certificate
holder continuation of coverage under the group policy.
(iv)
If a group Medicare supplement policy is replaced by another
group Medicare supplement policy purchased by the same policyholder, the issuer
of the replacement policy shall offer coverage to all persons covered under
the old group policy on its date of termination. Coverage under the new policy
shall not result in any exclusion of preexisting conditions that would have
been covered under the group policy being replaced.
(v)
If a Medicare supplement policy eliminates an outpatient
prescription drug benefit as a result of requirements imposed by the MMA,
the modified policy shall be deemed to satisfy the guaranteed renewal requirements
of this paragraph.
(F)
Termination of a Medicare supplement policy shall be without
prejudice to any continuous loss which commenced while the policy was in force,
but the extension of benefits beyond the period during which the policy was
in force may be predicated upon the continuous total disability of the insured,
limited to the duration of the policy benefit period, if any, or payment of
the maximum benefits. Receipt of Medicare Part D benefits will not be considered
in determining a continuous loss.
(G)
A Medicare supplement policy or certificate shall provide
that benefits and premiums under the policy or certificate shall be suspended
at the request of the policyholder or certificate holder for the 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, but only if the policyholder or certificate holder
notifies the issuer of such policy or certificate within 90 days after the
date the individual becomes entitled to such assistance.
(i)
If suspension occurs and if the policyholder or certificate
holder loses entitlement to medical assistance, the policy or certificate
shall be automatically reinstituted (effective as of the date of termination
of entitlement) as of the termination of entitlement if the policyholder or
certificate holder provides notice of loss of entitlement within 90 days after
the date of loss and pays the premium attributable to the period, effective
as of the date of termination of entitlement.
(ii)
Each Medicare supplement policy or certificate shall provide
that benefits and premiums under the policy or certificate shall be suspended
(for any period that may be provided by federal regulation) at the request
of the policyholder or certificate holder if the policyholder or certificate
holder 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). 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 as of the date
of loss of coverage) if the policyholder or certificate holder provides notice
of loss of coverage within 90 days after the date of such loss and pays the
premium attributable to the period, effective as of the date of termination
of entitlement.
(iii)
Reinstitution of such coverages shall provide for the
following:
(I)
waiver of any waiting period with respect to treatment
of preexisting conditions;
(II)
resumption of coverage which is substantially equivalent
to coverage in effect before the date of such suspension. If the suspended
Medicare supplement policy provided coverage for outpatient prescription drugs,
reinstitution of the policy for Medicare Part D enrollees shall be without
coverage for outpatient prescription drugs and shall otherwise provide substantially
equivalent coverage to the coverage in effect before the date of the suspension;
and
(III)
classification of premiums on terms at least as favorable
to the policyholder or certificate holder as the premium classification terms
that would have applied to the policyholder or certificate holder had the
coverage not been suspended.
(H)
If a Medicare supplement policy eliminates an outpatient
prescription drug benefit as a result of requirements imposed by the MMA,
the modified policy shall be deemed to satisfy the guaranteed renewal requirements
of this paragraph.
(2)
Standards for the basic (core) benefits common to benefit
plans A - J. Every issuer shall make available a policy or certificate including
only the basic "core" package of benefits described in subparagraphs (A) -
(E) of this paragraph to each prospective insured. An issuer may make available
to prospective insureds any of the other Medicare supplement insurance benefit
plans in addition to the basic core package, but not in lieu of it. The basic
core benefits shall consist of the following:
(A)
coverage for Part A Medicare eligible expenses for hospitalization
to the extent not covered by Medicare from the 61st day through the 90th day
in any Medicare benefit period;
(B)
coverage for Part A Medicare eligible expenses, to the
extent not covered by Medicare, incurred as daily hospital charges during
use of Medicare lifetime hospital inpatient reserve days;
(C)
upon exhaustion of all Medicare hospital inpatient coverage
including the lifetime reserve days, coverage of 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. The provider shall
accept the issuer's payment as payment in full and may not bill the insured
for any balance;
(D)
coverage under Medicare Parts A and B for the reasonable
cost of the first three pints of blood (or equivalent quantities of packed
red blood cells, as defined under federal regulation) unless replaced in accordance
with federal regulation; and
(E)
coverage for the coinsurance amount (or in the case of
hospital outpatient department services paid under a prospective payment system,
the copayment amount) of Medicare eligible expenses under Part B regardless
of hospital confinement, subject to the Medicare Part B deductible.
(3)
Standards for Additional Benefits. The additional benefits
as uniformly defined in subparagraphs (A) - (K) of this paragraph shall be
included in Medicare Supplement Benefit Plans "B" through "J" only as provided
in paragraph (5)(A) - (I) of this section.
(A)
Medicare Part A Deductible--Coverage for all of the Medicare
Part A inpatient hospital deductible amount per benefit period.
(B)
Skilled Nursing Facility Care--Coverage for the actual
billed charges up to the coinsurance amount from the 21st day through the
100th day in a Medicare benefit period for post-hospital skilled nursing facility
care eligible under Medicare Part A.
(C)
Medicare Part B Deductible--Coverage for all of the Medicare
Part B deductible amount per calendar year regardless of hospital confinement.
(D)
Eighty Percent of the Medicare Part B Excess Charges--Coverage
for 80% of the difference between the actual Medicare Part B charge as billed
and the Medicare-approved Part B charge, not to exceed any charge limitation
established by the Medicare program or state law.
(E)
One Hundred Percent of the Medicare Part B Excess Charges--Coverage
for all of the difference between the actual Medicare Part B charge as billed
and the Medicare-approved Part B charge, not to exceed any charge limitation
established by the Medicare program or state law.
(F)
Basic Outpatient Prescription Drug Benefit--Coverage for
50% of outpatient prescription drug charges, after a $250 calendar year deductible,
to a maximum of $1,250 in benefits received by the insured per calendar year,
to the extent not covered by Medicare. The outpatient prescription drug benefit
may be included for sale or issuance in a Medicare supplement policy until
January 1, 2006.
(G)
Extended Outpatient Prescription Drug Benefit--Coverage
for 50% of outpatient prescription drug charges, after a $250 calendar year
deductible to a maximum of $3,000 in benefits received by the insured per
calendar year, to the extent not covered by Medicare. The outpatient prescription
drug benefit may be included for sale or issuance in a Medicare supplement
policy until January 1, 2006.
(H)
Medically Necessary Emergency Care in a Foreign Country--Coverage
to the extent not covered by Medicare for 80% of the billed charges for Medicare-eligible
expenses for medically necessary emergency hospital, physician, and medical
care received in a foreign country, which care would have been covered by
Medicare if provided in the United States and which care began during the
first 60 consecutive days of each trip outside the United States, subject
to a calendar year deductible of $250, and a lifetime maximum benefit of $50,000.
For purposes of this benefit, "emergency care" shall mean care needed immediately
because of an injury or an illness of sudden and unexpected onset.
(I)
Preventive Medical Care Benefit or Services--Coverage for
the preventive health services described in clauses (i) and (ii) of this subparagraph.
Coverage for preventive medical care benefits or services shall be for the
actual charges up to 100% of the Medicare-approved amount for each service,
as if Medicare were to cover the service as identified in American Medical
Association Current Procedural Terminology (AMA CPT) codes, to a maximum of
$120 annually under this benefit. This benefit shall not include payment for
any procedure covered by Medicare:
(i)
an annual clinical preventive medical history and physical
examination that may include tests and services from clause (ii) of this subparagraph
and patient education to address preventive health care measures;
(ii)
preventive screening tests or preventive services, the
selection and frequency of which are determined to be medically appropriate
by the attending physician.
(J)
At-Home Recovery Benefit--Coverage for services to provide
short-term, at-home assistance with activities of daily living for those recovering
from an illness, injury, or surgery.
(i)
For purposes of this benefit, the following definitions
in subclauses (I) - (IV) of this clause shall apply.
(I)
Activities of daily living include, but are not limited
to, bathing, dressing, personal hygiene, transferring, eating, ambulating,
assistance with drugs that are normally self-administered, and changing bandages
or other dressings.
(II)
Care provider means a duly qualified or licensed home
health aide or homemaker, personal care aide, or nurse provided through a
licensed home health care agency or referred by a licensed referral agency
or licensed nurses registry.
(III)
Home shall mean any place used by the insured as a place
of residence, provided that such place would qualify as a residence for home
health care services covered by Medicare. A hospital or skilled nursing facility
shall not be considered the insured's place of residence.
(IV)
At-home recovery visit means the period of a visit required
to provide at-home recovery care, without limit on the duration of the visit,
except each consecutive four hours in a 24-hour period of services provided
by a care provider is one visit.
(ii)
Coverage requirements and limitations.
(I)
At-home recovery services provided must be primarily services
which assist in activities of daily living.
(II)
The insured's attending physician must certify that the
specific type and frequency of at-home recovery services are necessary because
of a condition for which a home care plan of treatment was approved by Medicare.
(III)
Coverage is limited to:
(-a-)
no more than the number and type of at-home recovery
visits certified as necessary by the insured's attending physician. The total
number of at-home recovery visits shall not exceed the number of Medicare
approved home health care visits under a Medicare approved home care plan
of treatment;
(-b-)
the actual charges for each visit up to maximum coverage
of $40 per visit;
(-c-)
$1,600 per calendar year;
(-d-)
seven visits in any one week;
(-e-)
care furnished on a visiting basis in the insured's home;
(-f-)
services provided by a care provider as defined in this
section;
(-g-)
at-home recovery visits while the insured is covered
under the policy or certificate and not otherwise excluded;
(-h-)
at-home recovery visits received during the period the
insured is receiving Medicare approved home care services or no more than
eight weeks after the service date of the last Medicare approved home health
care visit.
(iii)
Coverage is excluded for:
(I)
home care visits paid for by Medicare or other government
programs; and
(II)
care provided by family members, unpaid volunteers, or
providers who are not care providers.
(K)
New or Innovative Benefits--Any benefit which an issuer
may, with the prior approval of the commissioner, offer in addition to the
benefits provided in a policy or certificate that otherwise complies with
the applicable standards. The new or innovative benefits may include benefits
that are appropriate to Medicare supplement insurance, new or innovative,
not otherwise available, cost-effective, and offered in a manner which is
consistent with the goal of simplification of Medicare supplement policies.
After December 31, 2005, the innovative benefit shall not include an outpatient
prescription drug benefit.
(4)
Requirement of uniformity for all Medicare supplement benefit
plans. An issuer shall make available only those groups, packages or combinations
of Medicare supplement benefits as described in this section, unless otherwise
permitted by provisions of paragraph (3)(K) of this section and in §3.3325
of this title (relating to Medicare Select Policies, Certificates and Plans
of Operation). Benefit plans shall be uniform in structure, language, designation
and format to the standard benefit plan "A," defined as the basic core plan
of benefits in paragraph (2) of this section and described in paragraph (5)(A)
of this section, and benefit plans "B" through "J," described in paragraph
(5)(B) - (L) of this section. All benefit plans shall conform to the definitions
set out in §3.3303 of this title (relating to Definitions) and §3.3304
of this title (relating to Policy Definitions and Terms). Each benefit shall
be structured in accordance with the format provided in paragraphs (2) and
(3) of this section. Each benefit plan shall list the benefits in the order
shown in paragraph (5)(A) - (L) of this section. For purposes of this paragraph,
"structure, language, and format" means style, arrangement and overall content
of a benefit. In addition to the benefit plan designations required in this
paragraph, an issuer may use other designations to the extent permitted by
law.
(5)
Make-up of Benefit Plans. Subparagraphs (A) - (N) of this
paragraph set out the composition of benefit plans. Each benefit plan shall
meet the requirements of this subchapter.
(A)
Standardized Medicare Supplement Benefit Plan "A." Medicare
supplement benefit Plan "A" shall include only the Core Benefits common to
All Benefit Plans, as defined in paragraph (2) of this section.
(B)
Standardized Medicare Supplement Benefit Plan "B." Medicare
supplement benefit Plan "B" shall include only the Core Benefits as defined
in paragraph (2) of this section, plus the Medicare Part A Deductible as defined
in paragraph (3) of this section.
(C)
Standardized Medicare Supplement Benefit Plan "C." Medicare
supplement benefit Plan "C" shall include only the Core Benefit as defined
in paragraph (2) of this section, plus the Medicare Part A Deductible, Skilled
Nursing Facility Care, Medicare Part B Deductible and Medically Necessary
Emergency Care in a Foreign Country as defined in paragraph (3) of this section.
(D)
Standardized Medicare Supplement Benefit Plan "D." Medicare
supplement benefit Plan "D" shall include only the Core Benefit as defined
in paragraph (2) of this section, plus the Medicare Part A Deductible, Skilled
Nursing Facility Care, Medically Necessary Emergency Care in a Foreign Country
and the At-Home Recovery Benefit as defined in paragraph (3) of this section.
(E)
Standardized Medicare Supplement Benefit Plan "E." Medicare
supplement benefit Plan "E" shall include only the Core Benefit as defined
in paragraph (2) of this section, plus the Medicare Part A Deductible, Skilled
Nursing Facility Care, Medically Necessary Emergency Care in a Foreign Country
and Preventive Medical Care as defined in paragraph (3) of this section.
(F)
Standardized Medicare Supplement Benefit Plan "F." Medicare
supplement benefit Plan "F" shall include only the Core Benefit as defined
in paragraph (2) of this section, plus the Medicare Part A Deductible, the
Skilled Nursing Facility Care, the Part B Deductible, One Hundred Percent
of the Medicare Part B Excess Charges, and Medically Necessary Emergency Care
in a Foreign Country as defined in paragraph (3) of this section.
(G)
Standardized Medicare Supplement Benefit High Deductible
Plan "F." Medicare supplement benefit high deductible Plan "F" shall include
only the following: 100% of covered expenses following the payment of the
annual high deductible Plan "F" deductible. The covered expenses include the
Core Benefit as defined in paragraph (2) of this section, plus the Medicare
Part A Deductible, Skilled Nursing Facility Care, Medicare Part B Deductible,
100% of the Medicare Part B Excess Charges, and Medically Necessary Emergency
Care in a Foreign Country as defined in paragraph (3) of this section. The
annual high deductible Plan "F" deductible shall consist of out-of-pocket
expenses, other than premiums for services covered by the Medicare supplement
Plan "F" policy, and shall be in addition to any other specific benefit deductibles.
The annual high deductible Plan "F" deductible shall be $1500 for 1998 and
1999, and shall be based on the calendar year. It shall be adjusted annually
thereafter by the Secretary to reflect the change in the Consumer Price Index
for all urban consumers for the twelve-month period ending with August of
the preceding year, and rounded to the nearest multiple of $10.
(H)
Standardized Medicare Supplement Benefit Plan "G." Medicare
supplement benefit Plan "G" shall include only the Core Benefit as defined
in paragraph (2) of this section, plus the Medicare Part A Deductible, Skilled
Nursing Facility Care, Eighty Percent of the Medicare Part B Excess Charges,
Medically Necessary Emergency Care in a Foreign Country, and the At-Home Recovery
Benefit as defined in paragraph (3) of this section.
(I)
Standardized Medicare Supplement Benefit Plan "H." Medicare
supplement benefit Plan "H" shall include only the Core Benefit as defined
in paragraph (2) of this section, plus the Medicare Part A Deductible, Skilled
Nursing Facility Care, Basic Prescription Drug Benefit and Medically Necessary
Emergency Care in a Foreign Country as defined in paragraph (3) of this section.
The outpatient prescription drug benefit shall not be included in a Medicare
supplement policy sold after December 31, 2005.
(J)
Standardized Medicare Supplement Benefit Plan "I." Medicare
supplement benefit Plan "I" shall include only the Core Benefit as defined
in paragraph (2) of this section, plus the Medicare Part A Deductible, Skilled
Nursing Facility Care, One Hundred Percent of the Medicare Part B Excess Charges,
Basic Prescription Drug Benefit, Medically Necessary Emergency Care in a Foreign
Country and At-Home Recovery Benefit as defined in paragraph (3) of this section.
The outpatient prescription drug benefit shall not be included in a Medicare
supplement policy sold after December 31, 2005.
(K)
Standardized Medicare Supplement Benefit Plan "J." Medicare
supplement benefit Plan "J" shall include only the Core Benefit as defined
in paragraph (2) of this section, plus the Medicare Part A Deductible, Skilled
Nursing Facility Care, Medicare Part B Deductible, One Hundred Percent of
the Medicare Part B Excess Charges, Extended Prescription Drug Benefit, Medically
Necessary Emergency Care in a Foreign Country, Preventive Medical Care and
At-Home Recovery Benefit as defined in paragraph (3) of this section. The
outpatient prescription drug benefit shall not be included in a Medicare supplement
policy sold after December 31, 2005.
(L)
Standardized Medicare Supplement Benefit High Deductible
Plan "J." Medicare supplement benefit high deductible Plan "J" shall include
only the following: 100% of covered expenses following the payment of the
annual high deductible Plan "J" deductible. The covered expenses include the
Core Benefit as defined in paragraph (2) of this section, plus the Medicare
Part A Deductible, Skilled Nursing Facility Care, Medicare Part B Deductible,
100% of the Medicare Part B Excess Charges, Extended Outpatient Prescription
Drug Benefit, Medically Necessary Emergency Care in a Foreign Country, Preventive
Medical Care and At-Home Recovery Benefit as defined in paragraph (3) of this
section. The annual high deductible Plan "J" deductible shall consist of out-of-pocket
expenses, other than premiums for services covered by the Medicare supplement
Plan "J" policy, and shall be in addition to any other specific benefit deductibles.
The annual high deductible Plan "J" deductible shall be $1500 for 1998 and
1999, and shall be based on the calendar year. It shall be adjusted annually
thereafter by the Secretary to reflect the change in the Consumer Price Index
for all urban consumers for the twelve-month period ending with August of
the preceding year, and rounded to the nearest multiple of $10. The outpatient
prescription drug benefit shall not be included in a Medicare supplement policy
sold after December 31, 2005.
(M)
Standardized Medicare supplement benefit Plan "K" shall
include only the following:
(i)
Coverage of 100% of the Part A hospital coinsurance amount
for each day used from the 61st through the 90th day in any Medicare benefit
period;
(ii)
Coverage of 100% of the 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;
(iii)
Upon exhaustion of the Medicare hospital inpatient coverage,
including the lifetime reserve days, coverage of 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. The provider shall
accept the issuer's payment as payment in full and may not bill the insured
for any balance;
(iv)
Medicare Part A Deductible: Coverage for 50% of the Medicare
Part A inpatient hospital deductible amount per benefit period until the out-of-pocket
limitation is met as described in clause (x) of this subparagraph;
(v)
Skilled Nursing Facility Care: Coverage for 50% of the
coinsurance amount for each day used from the 21st day through the 100th day
in a Medicare benefit period for post-hospital skilled nursing facility care
eligible under Medicare Part A until the out-of-pocket limitation is met as
described in clause (x) of this subparagraph;
(vi)
Hospice Care: Coverage for 50% of cost sharing for all
Part A Medicare eligible expenses and respite care until the out-of-pocket
limitation is met as described in clause (x) of this subparagraph;
(vii)
Coverage for 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 as described in clause (x) of this subparagraph;
(viii)
Except for coverage provided in clause (ix) of this
subparagraph, coverage for 50% of the cost sharing otherwise applicable under
Medicare Part B after the policyholder pays the Part B deductible until the
out-of-pocket limitation is met as described in clause (x) of this subparagraph;
(ix)
Coverage of 100% of the cost sharing for Medicare Part
B preventive services after the policyholder pays the Part B deductible; and
(x)
Coverage of 100% of all cost sharing under Medicare Parts
A and B for the balance of the calendar year after the individual has reached
the out-of-pocket limitation on annual expenditures under Medicare Parts A
and B of $4000 in calendar year 2006, indexed each year by the appropriate
inflation adjustment specified by the Secretary.
(N)
Standardized Medicare supplement benefit Plan "L" shall
include only the following:
(i)
The benefits described in subparagraph (M)(i), (ii), (iii)
and (ix) of this paragraph;
(ii)
The benefits described in subparagraph (M)(iv), (v), (vi),
(vii) and (viii) of this paragraph, but substituting 75% for 50%; and
(iii)
The benefit described in subparagraph (M)(x) of this
paragraph, but substituting $2000 for $4000.
§3.3308.Required Disclosure Provisions.
(a)
General rules.
(1)
Medicare supplement policies and certificates shall include
a renewal or continuation provision. The language or specifications of such
provision must be consistent with the type of contract issued. The provisions
shall be appropriately captioned, and shall appear on the first page of the
policy, and shall include any reservation by the issuer of the right to change
premiums and any automatic renewal premium increases based on the age of the
policyholder.
(2)
Except for riders or endorsements by which the issuer effectuates
a request made in writing by the policyholder, or by which the issuer exercises
a specifically reserved right under a Medicare supplement policy, or by which
the issuer is required to reduce or eliminate benefits to avoid duplication
of Medicare benefits, all riders or endorsements added to a Medicare supplement
policy after the date of issue or at reinstatement or renewal which reduce
or eliminate benefits or coverage in the policy shall require signed acceptance
by the policyholder. After the date of issue of the policy or certificate,
any rider or endorsement which increases benefits or coverage with concomitant
increase in premium during the policy term shall be agreed to in writing signed
by the policyholder, unless the benefits are required by the minimum standards
for Medicare supplement insurance policies, or unless the increased benefits
or coverage is required by law. Where a separate additional premium is charged
for benefits provided in connection with riders or endorsements, the additional
premium charge shall be set forth in the policy.
(3)
Medicare supplement policies shall not provide for the
payment of benefits based on standards described as "usual and customary,"
"reasonable and customary," or words of similar import.
(4)
If a Medicare supplement policy or certificate contains
any limitations with respect to preexisting conditions:
(A)
the limitations shall appear as a separate paragraph of
the policy or certificate and be labeled as "Preexisting Condition Limitations;"
(B)
the policy or certificate shall define the term "preexisting
condition" and shall provide an explanation of the term in its accompanying
outline of coverage; and
(C)
the policy or certificate shall include a provision explaining
the reduction of the preexisting condition limitation for individuals that
qualify under §3.3306(1)(A) of this title (relating to Minimum Benefit
Standards), §3.3312(a)(2) of this title (relating to Guaranteed Issue
to Eligible Persons), or §3.3324(c) and (d) of this title (relating to
Open Enrollment).
(5)
Medicare supplement policies and certificates shall have
a notice prominently printed on the first page or attached thereto stating
in substance that the policyholder or certificate holder shall have the right
to return the policy or certificate within 30 days of its delivery and to
have the premium refunded if after examination the insured person is not satisfied
for any reason.
(6)
Issuers of accident and sickness policies, certificates,
or subscriber contracts which provide hospital or medical expense coverage
on an expense incurred or indemnity basis, to a person(s) eligible for Medicare
shall provide to those applicants a Guide to Health Insurance for People with
Medicare in the form developed jointly by the National Association of Insurance
Commissioners and the Centers for Medicare and Medicaid Services of the United
States Department of Health and Human Services in no smaller than 12-point
type.
(A)
For purposes of this section, "form" means the language,
format, style, type size, type proportional spacing, bold character, and line
spacing.
(B)
If a Guide incorporating the latest statutory changes is
not available from a government agency, companies may comply with this provision
by modifying the latest available Guide to the extent required by applicable
law.
(C)
Except as provided in this section, delivery of the Guide
shall be made whether or not such policies, certificates, subscriber contracts,
or evidences of coverage are advertised, solicited, or issued as Medicare
supplement policies or certificates as defined in this regulation.
(D)
Except in the case of direct response issuers, delivery
of the Guide shall be made to the applicant at the time of application and
acknowledgment of receipt of the Guide shall be obtained by the issuer. Provided,
however, issuers shall deliver the Guide to the applicant for a direct response
Medicare supplement policy upon request, but not later than at the time the
policy is delivered.
(7)
Except as otherwise provided in this section, the terms
"Medicare Supplement," "Medigap," "Medicare Wrap-Around" and words of similar
import may not be used unless the policy is issued in compliance with §3.3306
of this title.
(b)
Outline of coverage requirements for Medicare supplement
policies.
(1)
Issuers of Medicare supplement coverage in this state shall
provide an outline of coverage to all applicants, including certificate holders
under group policies, at the time application is presented to the prospective
applicant, and, except for direct response policies, shall obtain an acknowledgment
of receipt of such outline from the applicant.
(2)
If a Medicare supplement policy or certificate is issued
on a basis which would require revision of the outline of coverage delivered
at the time of application, a substitute outline of coverage properly describing
the policy or certificate actually issued shall accompany such policy or certificate
when it is delivered and contain the following statement in no less than 12-point
type, immediately above the company name: "Notice: Read this outline of coverage
carefully. It is not identical to the outline of coverage provided upon application
and the coverage originally applied for has not been issued."
(c)
Form for outline of coverage. In providing outlines of
coverage to applicants pursuant to the requirements of subsection (b)(1) of
this section, insurers shall use a form which complies with the requirements
of this subsection. The outline of coverage must contain each of the following
four parts in the following order: a cover page, premium information, disclosure
pages, and charts displaying the features of each benefit plan offered by
the issuer. The outline of coverage shall be in the language and format prescribed
in paragraphs (1) and (2) of this subsection in no less than 12-point type.
(1)
All plans A - J shall be shown on the cover page, and the
plan(s) that are offered by the issuer shall be prominently identified. Premium
information for plans that are offered shall be shown on the cover page or
immediately following the cover page and shall be prominently displayed. The
premium and mode shall be stated for all plans that are offered to the prospective
applicant. All possible premiums for the prospective applicant shall be illustrated.
(2)
The items in subparagraphs (A) - (C) of this paragraph
shall be included in the outline of coverage in addition to the items specified
in the plan-specific outline-of-coverage forms.
(A)
Dollar amounts which are shown in parentheses for each
of the plan-specific charts on the following pages are for calendar year 1992.
Issuers shall, for each plan offered, appropriately complete outline-of-coverage-chart
statements about amounts to be paid by Medicare, the plan, and the covered
person by replacing the amount in parentheses with the dollar amount corresponding
to each covered service for the applicable calendar year benefit period.
(B)
The outline of coverage must include an explanation of
any limitations and exclusions. Those limitations and exclusions resulting
from Medicare program provisions may be disclosed as such by reference and
need not be explained in their entirety. All limitations and exclusions related
to preexisting conditions, and all other limitations and exclusions not resulting
from Medicare regulations must be fully explained in the outline of coverage.
(C)
The outline of coverage must include a statement that the
policy either does or does not contain provisions providing for a refund or
partial refund of premium upon the death of an insured or the surrender of
the policy or certificate. If the policy contains such provisions, a description
of them must be included.
(D) The outline of coverage for Medicare Select policies or
certificates shall include information regarding grievance procedures which
meet the requirements of §3.3325(m) of this title (relating to Medicare
Select Policies, Certificates and Plans of Operation).
Figure: 28 TAC §3.3308(c)(2)(D) (.pdf)
(d) Notice requirements.
(1) As soon as practicable, but no later than 30 days prior
to the annual effective date of any Medicare benefit changes, every issuer
providing Medicare supplement coverage to a resident of this state shall notify
its policyholders, contract holders, and certificate holders of modifications
it has made to Medicare supplement insurance policies, contracts, or certificates.
The notice shall:
(A) include a description of revisions to the Medicare program
and a description of each modification made to the coverage provided under
the Medicare supplement insurance policy, contract, or certificate; and
(B)
inform each covered person as to when any premium adjustment
is to be made due to changes in Medicare.
(2)
The notice of benefit modifications and any premium adjustments
shall be in outline form and in clear and simple terms so as to facilitate
comprehension.
(3)
The notice shall not contain or be accompanied by any solicitation.
(4)
Issuers shall comply with any notice requirements of the
MMA.
§3.3312.Guaranteed Issue for Eligible Persons.
(a)
Guaranteed issue.
(1)
Eligible persons are those individuals described in subsection
(b) of this section who seek to enroll under the Medicare supplement policy
during the period specified in subsection (d) of this section, and who submit
evidence of the date of termination, disenrollment, or Medicare Part D enrollment
with the application for a Medicare supplement policy.
(2)
With respect to eligible persons, an issuer shall not deny
or condition the issuance or effectiveness of a Medicare supplement policy
described in subsection (c) of this section that is offered and is available
for issuance to newly enrolled individuals by the issuer, and shall not discriminate
in the pricing of such a Medicare supplement policy because of health status,
claims experience, receipt of health care, or medical condition, and shall
not impose an exclusion of benefits based on a preexisting condition under
such a Medicare supplement policy.
(b)
Eligible Persons. An eligible person is an individual described
in any of the following paragraphs:
(1)
The individual is enrolled under an employee welfare benefit
plan that provides health benefits that supplement the benefits under Medicare,
and the plan terminates, or the plan ceases to provide all such supplemental
health benefits to the individual; or the individual is enrolled under an
employee welfare benefit plan that is primary to Medicare and the plan terminates
or the plan ceases to provide all health benefits to the individual because
the individual leaves the plan.
(2)
The individual is enrolled with a Medicare Advantage organization
under a Medicare Advantage plan under Part C of Medicare, and any of the following
circumstances apply, or the individual is 65 years of age or older and is
enrolled with a Program of All-Inclusive Care for the Elderly (PACE) provider
under section 1894 of the Social Security Act, and there are circumstances
similar to the following that would permit discontinuance of the individual's
enrollment with such provider if such individual were enrolled in a Medicare
Advantage plan:
(A)
The certification of the organization or plan has been
terminated; or
(B)
The organization has terminated or otherwise discontinued
providing the plan in the area in which the individual resides;
(C)
The individual is no longer eligible to elect the plan
because of a change in the individual's place of residence or other change
in circumstances specified by the Secretary, but not including termination
of the individual's enrollment on the basis described in section 1851(g)(3)(B)
of the Social Security Act (where the individual has not paid premiums on
a timely basis or has engaged in disruptive behavior as specified in standards
under section 1856), or the plan is terminated for all individuals within
a residence area;
(D)
The individual demonstrates, in accordance with guidelines
established by the Secretary, that:
(i)
The organization offering the plan substantially violated
a material provision of the organization's contract under U.S.C. Title 42,
Chapter 7, Subchapter XVIII, Part D in relation to the individual, including
the failure to provide an individual on a timely basis medically necessary
care for which benefits are available under the plan or the failure to provide
such covered care in accordance with applicable quality standards; or
(ii)
The organization, or agent or other entity acting on the
organization's behalf, materially misrepresented the plan's provisions in
marketing the plan to the individual; or
(E)
The individual meets such other exceptional conditions
as the Secretary may provide.
(3)
The individual is enrolled with an entity listed in subparagraphs
(A) - (D) of this paragraph and enrollment ceases under the same circumstances
that would permit discontinuance of an individual's election of coverage under
paragraph (2) of this subsection:
(A)
An eligible organization under a contract under section
1876 of the Social Security Act (Medicare cost);
(B)
A similar organization operating under demonstration project
authority, effective for periods before April 1, 1999;
(C)
An organization under an agreement under section 1833(a)(1)(A)
of the Social Security Act (health care prepayment plan); or
(D)
An organization under a Medicare Select policy; and
(4)
The individual is enrolled under a Medicare supplement
policy and the enrollment ceases because:
(A)
Of the insolvency of the issuer or bankruptcy of the nonissuer
organization; or of other involuntary termination of coverage or enrollment
under the policy;
(B)
The issuer of the policy substantially violated a material
provision of the policy; or
(C)
The issuer, or an agent or other entity acting on the issuer's
behalf, materially misrepresented the policy's provisions in marketing the
policy to the individual;
(5)
The individual was enrolled under a Medicare supplement
policy and terminates enrollment and subsequently enrolls, for the first time,
with any Medicare Advantage organization under a Medicare Advantage plan under
part C of Medicare, any eligible organization under a contract under section
1876 of the Social Security Act (Medicare cost), any similar organization
operating under demonstration project authority, any PACE provider under section
1894 of the Social Security Act, or a Medicare Select policy; and the subsequent
enrollment is terminated by the individual during any period within the first
12 months of such subsequent enrollment (during which the individual is permitted
to terminate such subsequent enrollment under section 1851(e) of the Social
Security Act); or
(6)
The individual, upon first becoming enrolled in Medicare
part B for benefits at age 65 or older, enrolls in a Medicare Advantage plan
under part C of Medicare, or with a PACE provider under section 1894 of the
Social Security Act, and disenrolls from the plan or program no later than
12 months after the effective date of enrollment.
(7)
The individual enrolls in a Medicare Part D plan during
the initial enrollment period and, at the time of enrollment in Part D, was
enrolled under a Medicare supplement policy that covers outpatient prescription
drugs and the individual terminates enrollment in the Medicare supplement
policy and submits evidence of enrollment in Medicare Part D along with the
application for a policy described in subsection (c)(4) of this section.
(8)
The individual loses eligibility for health benefits under
Title XIX of the Social Security Act (Medicaid).
(c)
Products to Which Eligible Persons are Entitled. The Medicare
supplement policy to which eligible persons are entitled under:
(1)
Subsection (b)(1), (2), (3), (4), and (8) of this section
is a Medicare supplement policy which has a benefit package classified as
Plan A, B, C, F (including F with a high deductible), K, or L offered by any
issuer, except that for persons under 65 years of age, it is a policy which
has a benefit package classified as Plan A.
(2)
Subsection (b)(5) of this section is the same Medicare
supplement policy in which the individual was most recently previously enrolled,
if available from the same issuer, or, if not so available, a policy described
in paragraph (1) of this subsection. After December 31, 2005, if the individual
was most recently enrolled in a Medicare supplement policy with an outpatient
prescription drug benefit, the Medicare supplement policy described in this
paragraph is the policy available from the same issuer but modified to remove
outpatient prescription drug coverage, or at the election of the policyholder,
a policy described in paragraph (1) of this subsection.
(3)
Subsection (b)(6) of this section shall include any Medicare
supplement policy offered by any issuer.
(4)
Subsection (b)(7) of this section is a Medicare supplement
policy that has a benefit package classified as Plan A, B, C, F (including
F with a high deductible), K, or L, and that is offered and is available for
issuance to new enrollees by the same issuer that issued the individual's
Medicare supplement policy with outpatient prescription drug coverage.
(d)
Guaranteed Issue Time Period(s).
(1)
In the case of an individual described in subsection (b)(1)
of this section:
(A)
for a plan that supplements the benefits under Medicare,
the guaranteed issue period begins on the later of:
(i)
the date the individual receives a notice of termination
or cessation of all supplemental health benefits (or if a notice is not received,
the date the individual receives notice that a claim has been denied because
of such termination or cessation); or
(ii)
the date the applicable coverage terminates or ceases;
and ends sixty-three (63) days thereafter; or
(B)
for a plan that is primary to the benefits under Medicare,
the guaranteed issue period begins on the later of:
(i)
the date the individual receives a notice of termination
or cessation of all health benefits (or if a notice is not received, the date
the individual receives notice that a claim has been denied because of such
termination or cessation); or
(ii)
the date the applicable coverage terminates or ceases;
and ends sixty-three (63) days thereafter.
(2)
In the case of an individual described in subsection (b)(2),
(3), (5), or (6) of this section whose enrollment is terminated involuntarily,
the guaranteed issue period begins on the date that the individual receives
a notice of termination and ends 63 days after the date the applicable coverage
is terminated;
(3)
In the case of an individual described in subsection (b)(4)(A)
of this section, the guaranteed issue period begins on the earlier of the
date that the individual receives a notice of termination, a notice of the
issuer's bankruptcy or insolvency, or other such similar notice if any, and
the date that the applicable coverage is terminated, and ends on the date
that is 63 days after the date the coverage is terminated;
(4)
In the case of an individual described in subsection (b)(2),
(4)(B) and (C), (5), or (6) of this section, who disenrolls voluntarily, the
guaranteed issue period begins on the date that is 60 days before the effective
date of the disenrollment and ends on the date that is 63 days after the effective
date of disenrollment;
(5)
In the case of an individual described in subsection (b)(7)
of this section, the guaranteed issue period begins on the date the individual
receives notice pursuant to Section 1882(v)(2)(B) of the Social Security Act
from the Medicare supplement issuer during the sixty-day period immediately
preceding the initial Part D enrollment period and ends on the date that is
63 days after the effective date of the individual's coverage under Medicare
Part D; and
(6)
In the case of an individual described in subsection (b)
of this section, but not described in paragraphs (1) - (5) of this subsection,
the guaranteed issue period begins on the effective date of disenrollment
and ends on the date that is 63 days after the effective date of disenrollment.
(e)
Extended Medicare Supplement Access for Interrupted Trial
Periods.
(1)
In the case of an individual described in subsection (b)(5)
of this section (or deemed to be so described, pursuant to this paragraph),
whose enrollment with an organization or provider described in subsection
(b)(5) of this section is involuntarily terminated within the first 12 months
of enrollment, and who, without an intervening enrollment, enrolls with another
such organization or provider, the subsequent enrollment shall be deemed to
be an initial enrollment as described in subsection (b)(5) of this section.
(2)
In the case of an individual described in subsection (b)(6)
of this section (or deemed to be so described, pursuant to this paragraph),
whose enrollment with a plan or in a program described in subsection (b)(6)
of this section is involuntarily terminated within the first 12 months of
enrollment, and who, without an intervening enrollment, enrolls with another
such plan or program, the subsequent enrollment shall be deemed to be an initial
enrollment as described in subsection (b)(6) of this section.
(3)
For purposes of subsection (b)(5) and (6) of this section,
no enrollment of an individual with an organization or provider described
in subsection (b)(5) of this section, or with a plan or in a program described
in subsection (b)(6) of this section, may be deemed to be an initial enrollment
under this paragraph after the 2-year period beginning on the date on which
the individual first enrolled with such an organization, provider, plan, or
program.
§3.3322.Filing and Approval of Policies, Certificates and Premium Rates; Discontinuance of Forms.
(a)
An issuer shall not deliver or issue for delivery a policy
or certificate to a resident of this state unless the policy form or certificate
form has been filed with and approved by the commissioner in accordance with
filing requirements and procedures prescribed by the Insurance Code and applicable
regulations.
(b)
An issuer shall file any riders or amendments to policy
or certificate forms to delete outpatient prescription drug benefits as required
by the MMA only with the commissioner in the state in which the policy or
certificate was issued.
(c)
An issuer shall not use or change premium rates for a Medicare
supplement policy or certificate unless the rates, rating schedule and supporting
documentation have been filed with and approved by the commissioner in accordance
with the filing requirements and procedures prescribed by the Insurance Code
and this subchapter.
(d)
Except as provided in paragraphs (1) and (2) of this subsection,
an issuer shall not file for approval more than one form of a policy or certificate
of each type for each standard Medicare supplement benefit plan. For the purposes
of this section, a "type" means an individual policy, a group policy, an individual
Medicare Select policy, or a group Medicare Select policy. An issuer may offer,
with the approval of the commissioner, one additional policy form or certificate
form of the same type for the same standard Medicare supplement benefit plan,
one for each of the following cases:
(1)
the inclusion of new or innovative benefits; and
(2)
the offering of coverage to individuals eligible for Medicare
by reason of disability.
(e)
Except as provided in paragraph (1) of this subsection,
an issuer shall continue to make available for purchase any policy form or
certificate form issued after the effective date of this regulation that has
been approved by the commissioner. A policy form or certificate form shall
not be considered to be available for purchase unless the issuer has actively
offered it for sale in the previous 12 months.
(1)
An issuer may discontinue the availability of a policy
form or certificate form if the issuer provides to the commissioner in writing
its decision at least 30 days prior to discontinuing the availability of the
form of the policy or certificate. After receipt of the notice by the commissioner,
the issuer shall no longer offer for sale the policy form or certificate form
in this state.
(2)
An issuer that discontinues the availability of a policy
form or certificate form pursuant to paragraph (1) of this subsection shall
not file for approval a new policy form or certificate form of the same type
for the same standard Medicare supplement benefit plan as the discontinued
form for a period of five years after the issuer provides notice to the commissioner
of the discontinuance. The period of discontinuance may be reduced if the
commissioner determines that a shorter period is appropriate.
(f)
The sale or other transfer of Medicare supplement business
to another issuer shall be considered a discontinuance for the purposes of
this subsection.
(g)
A change in the rating structure or methodology shall be
considered a discontinuance under subsection (e)(1) of this section, unless
the issuer complies with the following requirements:
(1)
The issuer provides an actuarial memorandum, in a form
and manner prescribed by the commissioner, describing the manner in which
the revised rating methodology and resultant rates differ from the existing
rating methodology and existing rates.
(2)
The issuer does not subsequently put into effect a change
of rates or rating factors that would cause the percentage differential between
the discontinued and subsequent rates as described in the actuarial memorandum
to change. The commissioner may approve a change to the differential which
is in the public interest.
(h)
The experience of all policy forms or certificate forms
of the same type in a standard Medicare supplement benefit plan shall be combined
for purposes of the refund or credit calculation prescribed in §3.3307
of this title (relating to Loss Ratio Standards and Refund or Credit of Premiums),
except that forms assumed under an assumption reinsurance agreement shall
not be combined with the experience of other forms for purposes of the refund
or credit calculation.
This agency hereby certifies that the adoption has been reviewed
by legal counsel and found to be a valid exercise of the agency's legal authority.
Filed with the Office of
the Secretary of State on April 20, 2005.
TRD-200501645
Gene C. Jarmon
General Counsel and Chief Clerk
Texas Department of Insurance
Effective date: May 10, 2005
Proposal publication date: November 26, 2004
For further information, please call: (512) 463-6327
Subchapter X. CREDENTIALING OF PHYSICIANS, ADVANCED PRACTICE NURSES AND PHYSICIAN ASSISTANTS
Chapter 21.
TRADE PRACTICES