New Jersey Administrative Code
Title 11 - INSURANCE
Chapter 4 - ACTUARIAL SERVICES
Subchapter 16 - MINIMUM STANDARDS FOR INDIVIDUAL HEALTH INSURANCE
Section 11:4-16.5 - Prohibited policy provisions

Universal Citation: NJ Admin Code 11:4-16.5

Current through Register Vol. 56, No. 18, September 16, 2024

(a) No policy except a short term, nonrenewable trip policy shall provide coverage solely for specifically identified kind(s) of accident(s); however a policy may provide increased benefits for specifically identified accident(s) for any accident only coverage specified in section 6(g) of this subchapter.

(b) No policy shall provide for the payment of a single premium for the entire term of the policy, except for nonrenewable policies issued for a term of one year or less.

(c) No policy shall provide benefits which duplicate the specific benefits provided by Part A or Part B of Medicare (benefits for which the insured is eligible to enroll).

(d) No policy or rider for additional coverage may be issued as a dividend unless an equivalent cash payment is offered to the policyholder as an alternative to such dividend policy or rider. No such dividend policy or rider shall be issued for an initial term of less than six months.

1. The initial renewal subsequent to the issuance of any policy or rider as a dividend shall clearly disclose that the policyholder is renewing the coverage that was provided as a dividend for the previous term and that such renewal is optional with the policyholder.

(e) A cash value or premium refund benefit may only be included in Disability Income Protection Coverage and only if it meets the conditions set forth in N.J.A.C. 11:4-16.6(d)2. No other policy shall provide a return of premium upon termination or suspension of coverage, retroactive waiver of premium paid during disability or payment of dividends on participating policies.

(f) No policy shall include a provision which predicates payment of benefits on the insured being house or home confined.

(g) Except as provided in 11:4-16.4(a)2, no policy shall contain provisions establishing a probationary or waiting period during which no coverage is provided under the policy, subject to the further exception that a policy may specify a probationary or waiting period for other than newborn children not to exceed six months for specified diseases or conditions and losses resulting therefrom for hernia, disorder of reproductive organs, varicose veins, adenoids, appendix and tonsils. However, the permissible six months exception shall not be applicable where such specified diseases or conditions are treated on an emergency basis. Accident policies shall not contain probationary or waiting periods.

(h) With respect to health insurance policies that are health benefits plans, carriers shall not limit or exclude coverage for preexisting conditions. For all other health insurance policies, no policy shall exclude coverage for a loss due to a preexisting condition, except where a condition is specifically excluded by the terms of the policy and in accordance with the following:

1. For a period greater than 24 months following the effective date of coverage where the insurer uses an application form designed to elicit the complete health history of the insured and on the basis of that application underwrites in accordance with the insurer's established standards; or

2. For a period greater than 12 months following the effective date of coverage where the insurer elects to use a simplified application, with or without a question as to the insured's health at the time of application, or elects not to use any application.

(i) Policies providing hospital confinement indemnity benefits shall not contain provisions excluding coverage because of confinement in a hospital operated by the federal government.

(j) No policy shall limit or exclude coverage by type of illness, accident, treatment, or medical condition, except as follows:

1. Preexisting conditions other than congenital anomalies of a covered newborn dependent child, except that for health benefits plans, no preexisting conditions, limitations, or exclusions are permitted at all;

2. Mental or emotional disorders and drug addiction; however, health benefits plans shall not exclude treatment of mental illness or substance use disorders;

3. Normal pregnancy and childbirth; however, health benefits plans shall not exclude coverage for pregnancy and childbirth;

4. Illness, treatment, or medical condition arising out of:
i. War or act of war (whether declared or undeclared), participation in a riot or insurrection, service in the armed forces or units auxiliary thereto;

ii. Suicide (while sane or insane), attempted suicide, or intentionally self-inflicted injury; however, health benefits plans shall not exclude coverage for treatment arising from such injury;

iii. Aviation, other than as a fare paying passenger on a regularly scheduled airline;

iv. With respect to short-term nonrenewable policies, interscholastic sports.

5. Cosmetic surgery, except that "cosmetic surgery" shall not include reconstructive surgery when such service is incidental to or follows surgery resulting from trauma, infection or other diseases of the involved part, and reconstructive surgery because of congenital disease or anomaly of a covered newborn dependent child which has resulted in a functional defect;

6. Foot care in connection with corns, calluses, flat feet, fallen arches, weak feet, chronic foot strain, or symptomatic complaints of the feet;

7. Care in connection with the detection and correction by manual or mechanical means of structural imbalance, distortion, or subluxation in the human body for purposes of removing nerve interference and the effects thereof, where such interference is the result of or related to distortion, misalignment or subluxation of, or in the vertebral column;

8. Treatment provided in a government hospital; benefits provided under Medicare or other governmental program (except Medicaid), any state or federal workers' compensation, employer's liability or occupational disease law, out-of-State automobile insurance coverage as defined at 11:3-37.2 and provided for at 11:3-37.3; services rendered by employees of hospitals, laboratories or other institutions; services performed by a member of the covered person's immediate family and services for which no charge is normally made in the absence of insurance;

9. Dental care or treatment;

10. Eyeglasses, hearing aids, and examinations for the prescription or fitting thereof; however, health benefits plans shall not exclude coverage for hearing aids consistent with P.L. 2008, c. 126;

11. Rest cures, custodial care, transportation and routine physical examinations;

12. Territorial limitations.

(k) A policy issued as a "Medicare supplement policy" pursuant to N.J.A.C. 11:4-16.6(g) shall not include limitations or exclusions which are more restrictive than those of Medicare for any type of care covered under the policy.

(l) No policy shall include a provision which gives the insurer an unconditional right of nonrenewal.

(m) No policy shall include a provision which reduces, limits or excludes benefits solely on the basis of the sex or marital status of the insured.

(n) Except with respect to Medicare supplement policies as defined in N.J.A.C. 11:4-16.6(g), and health insurance policies that are health benefits plans, other provisions of this section shall not impair or limit the use of waivers to exclude, limit or reduce coverage or benefits for specifically named or described preexisting disease, physical condition, or extra hazardous activity. Where waivers are required as a condition of issuance, renewal, or reinstatement, signed acceptance by the insured is required unless on initial issuance either the full text of the waiver is contained on the first page or specification page of the policy or prominent notice of the waiver appears on the first page or the specification page. Waivers to exclude, limit, or reduce coverage or benefits for specifically named or described preexisting diseases or physical conditions shall not be used in Medicare supplement policies or health insurance policies that are health benefits plans.

(o) Except as otherwise provided in N.J.A.C. 11:4-16.8(b)4, the terms "Medicare supplement," "Medigap," and words of similar import shall not be used unless the policy is issued in compliance with N.J.A.C. 11:4-16.6(g).

Disclaimer: These regulations may not be the most recent version. New Jersey may have more current or accurate information. We make no warranties or guarantees about the accuracy, completeness, or adequacy of the information contained on this site or the information linked to on the state site. Please check official sources.
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