Current through 2024-13, March 27, 2024
The following standards are applicable to all Medicare
supplement policies or certificates delivered or issued for delivery in this
State on or after January 1, 1992 and with an effective date of coverage prior
to June 1, 2010. No policy or certificate may be advertised, solicited,
delivered, or issued for delivery in this State as a Medicare supplement policy
or certificate unless it complies with these benefit standards.
A. General Standards. The following standards
apply to Medicare supplement policies and certificates and are in addition to
all other requirements of this Rule.
(1) A
Medicare supplement policy or certificate shall not exclude or limit benefits,
for losses incurred more than six (6) months from the effective date of
coverage, because the loss 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 (6) months before the effective date of
coverage."
(2) A Medicare
supplement policy or certificate shall not indemnify against losses resulting
from sickness on a different basis than losses resulting from
accidents.
(3) A Medicare
supplement policy or certificate shall provide that benefits designed to cover
cost sharing amounts under Medicare will be changed automatically to coincide
with any changes in the applicable Medicare deductible, copayment, or
coinsurance amounts. Premiums may be modified to correspond with such
changes.
(4) No Medicare supplement
policy or certificate 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.
(5) Each Medicare supplement policy shall be
guaranteed renewable.
a. The issuer shall not
cancel or nonrenew the policy solely on the ground of health status of the
individual; and
b. The issuer shall
not cancel or nonrenew the policy for any reason other than nonpayment of
premium or material misrepresentation.
c. If the Medicare supplement policy is
terminated by the group policyholder and is not replaced as provided under
Section 8(A)(5)(e), the issuer shall offer each certificate holder an
individual Medicare supplement policy which (at the option of the certificate
holder):
i. Provides for continuation of the
benefits contained in the group policy, or
ii. Provides for benefits that otherwise meet
the requirements of this subsection.
d. 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 the conversion opportunity described in Section 8(A)(5)(c);
or
ii. At the option of the group
policyholder, offer the certificate holder continuation of coverage under the
group policy.
e. 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 for preexisting conditions that would have been
covered under the group policy being replaced.
f. If a Medicare supplement policy eliminates
an outpatient prescription drug benefit as a result of requirements imposed by
the Medicare Prescription Drug, Improvement, and Modernization Act of 2003, the
modified policy shall be deemed to satisfy the guaranteed renewal requirements
of this paragraph.
(6)
Termination of a Medicare supplement policy or certificate 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 conditioned 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.
A carrier issuing a subsequent Medicare supplement policy may
not deny any claim otherwise covered under the policy on the basis that the
enrollee is entitled to an extension of coverage under a prior policy pursuant
to this paragraph, unless the prior carrier has paid the claim or has agreed in
writing that it is providing coverage for the claim. If the prior carrier does
not agree in writing to provide coverage for the claim, any disputes over the
carriers' respective responsibilities for payment may be resolved in accordance
with the procedures applicable to medical coverage as set forth in Bureau of
Insurance Rule 790.
(7)
a. 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 twenty-four (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 ninety (90) days after the date the
individual is notified that he or she is entitled to such assistance.
b. If suspension occurs and if the
policyholder or certificate holder loses entitlement to medical assistance,
such policy or certificate shall be automatically reinstituted, effective as of
the date of termination of such entitlement, if the policyholder or certificate
holder provides notice of loss of entitlement within ninety (90) days after the
date he or she is notified of loss, and pays the premium attributable to the
period beginning on the date of termination of entitlement.
c. Each Medicare supplement policy shall
provide that benefits and premiums under the policy shall be suspended (for the
period provided by federal regulation) at the request of the policyholder if
the policyholder is entitled to benefits under Section 226(b) of the Social
Security Act and is covered under a group health plan (as defined in Section
1862(b)(1)(A)(v) of the Social Security Act). If suspension occurs and if the
policyholder or certificate holder loses coverage under the group health plan,
the policy shall be automatically reinstituted, effective as of the date of
loss of coverage, if the policyholder provides notice of loss of coverage
within 90 days after the date of such loss and pays the premium attributable to
the period beginning on the date of termination of entitlement.
d. Reinstitution of such coverages:
i. Shall not provide for any waiting period
with respect to treatment of preexisting conditions;
ii. Shall provide for resumption of coverage
that 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 suspension; and
iii. Shall provide for 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.
(8)
An issuer must make a written offer to each of its Medicare supplement
policyholders or certificate holders with a 1990 standardized plan (as
described in Section
9 of this Rule) to exchange the plan
for a 2010 standardized plan (as described in Section
9.1 of this Rule). A written offer
to exchange the plan for a current standardized plan must also be included in
any subsequent notice of rate increase. The plans offered and any subsequent
exchange must be consistent with Sections
12(D) and
23.
B. Standards for Basic (Core) Benefits Common
to Benefit Plans A-J.
Every issuer shall make available a policy or certificate
including only the following basic "core" package of benefits 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.
(1) Coverage of 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;
(2) Coverage of Part A Medicare Eligible
Expenses incurred for hospitalization to the extent not covered by Medicare for
each Medicare lifetime inpatient reserve day used;
(3) 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 (PPS) 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;
Drafting Note:
The
issuer is required to pay whatever amount Medicare would have paid as if
Medicare was covering the hospitalization. The "or other Medicare appropriate
standard of payment" provision means the manner in which Medicare would have
paid. The issuer stands in the place of Medicare, and so the provider must
accept the issuer's payment as payment in full. The Outline of Coverage
specifies that the beneficiary will pay "$0", and the provider cannot balance
bill the insured.
(4) Coverage under Medicare Parts A and B for
the reasonable cost of the first three (3) pints of blood (or equivalent
quantities of packed red blood cells, as defined under federal regulations)
unless replaced in accordance with federal regulations;
(5) Coverage for the coinsurance amount (or
in the case of hospital outpatient department services 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.
Drafting Note:
In this
context, copayment amount means the least of "copayment amount," "beneficiary
copayment amount," and "hospital-elected reduced copayment amount" as those
terms are used in applicable federal law and regulation. Provisions governing
copayment for hospital outpatient department services under a prospective
payment system apply to all Medicare supplement policies or certificates issued
prior to and after the effective date of this payment system.
C. Standards for
Additional Benefits. The additional benefits included in Medicare Supplement
Benefit Plans "B" through "J," as provided by Section
9 of this Rule, shall be defined as
follows:
(1) Medicare Part A Deductible:
Coverage for all of the Medicare Part A inpatient hospital deductible amount
per benefit period.
(2) 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.
(3) Medicare Part
B Deductible: Coverage for all of the Medicare Part B deductible amount per
calendar year regardless of hospital confinement.
(4) Eighty Percent (80%) of the Medicare Part
B Excess Charges: Coverage for eighty percent (80%) of the difference between
the actual Medicare Part B charge as billed, not to exceed any charge
limitation established by the Medicare program or state law, and the
Medicare-approved Part B charge.
(5) One Hundred Percent (100%) of the
Medicare Part B Excess Charges: Coverage for all of the difference between the
actual Medicare Part B charge as billed, not to exceed any charge limitation
established by the Medicare program or state law, and the Medicare-approved
Part B charge.
(6) Basic Outpatient
Prescription Drug Benefit: Coverage for fifty percent (50%) of outpatient
prescription drug charges, after a two hundred fifty dollar ($250) calendar
year deductible, to a maximum of one thousand two hundred fifty dollars
($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.
(7) Extended Outpatient
Prescription Drug Benefit: Coverage for fifty percent (50%) of outpatient
prescription drug charges, after a two hundred fifty dollar ($250) calendar
year deductible to a maximum of three thousand dollars ($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.
(8) Medically Necessary Emergency Care in a
Foreign Country: Coverage to the extent not covered by Medicare for eighty
percent (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 sixty (60)
consecutive days of each trip outside the United States, subject to a calendar
year deductible of two hundred fifty dollars ($250), and a lifetime maximum
benefit of fifty thousand dollars ($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.
(9) Preventive Medical Care Benefit: Coverage
for the following preventive health services not covered by Medicare:
a. An annual clinical preventive medical
history and physical examination that may include tests and services from
Subparagraph (b) and patient education to address preventive health care
measures;
b. Preventive screening
tests or preventive services, the selection and frequency of which is
determined to be medically appropriate by the attending physician.
Reimbursement shall be for the actual charges up to one
hundred percent (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 one
hundred twenty dollars ($120) annually under this benefit. This benefit shall
not include payment for any procedure covered by Medicare.
(10) 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.
a. For purposes of this benefit, the
following definitions 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 4 hours in
a 24-hour period of services provided by a care provider is one
visit.
b. 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:
I. 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.
II.
The actual charges for each visit up to a maximum reimbursement for forty
dollars ($40) per visit.
III. One
thousand six hundred dollars ($1,600) per calendar year.
IV. Seven (7) visits in any one
week.
V. Care furnished on a
visiting basis in the insured's home.
VI. Services provided by a care provider as
defined in this section.
VII.
At-home recovery visits while the insured is covered under the policy or
certificate and not otherwise excluded.
VIII. At-home recovery visits received during
the period the insured is receiving Medicare approved home care services or no
more than eight (8) weeks after the service date of the last Medicare approved
home health care visit.
c. 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.
D. Standards for Plans K and L
(1) Standardized Medicare supplement benefit
plan "K" shall consist of the following:
a.
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;
b. 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;
c. 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 (PPS) 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. 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 Subparagraph
(j);
e. 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 Subparagraph (j);
f. 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 Subparagraph (j);
g. Coverage for 50%, under Medicare Part A or
B, of the reasonable cost of the first three (3) 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 Subparagraph (j);
h. Except for coverage provided in
subparagraph (i) below, 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
Subparagraph (j) below;
i. Coverage
of 100% of the cost sharing for Medicare Part B preventive services after the
policyholder pays the Part B deductible; and
j. 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, which was $4000 in 2006 and is indexed each year
by the appropriate inflation adjustment specified by the Secretary of the U.S.
Department of Health and Human Services.
(2) Standardized Medicare supplement benefit
plan "L" shall consist of the following:
a.
The benefits described in Paragraphs (1)(a),(b),(c), and (i);
b. The benefit described in Paragraphs
(1)(d),(e),(f),(g), and (h), but substituting 75% for 50%; and
c. The benefit described in Paragraph (1)(j),
but substituting $2000 for $4000.