Current through all regulations passed and filed through September 16, 2024
(A) Purpose
The purpose of this rule is to implement a state long-term care
partnership program in Ohio in accordance with sections
3923.41 to
3923.49 and
5164.86 of the Revised
Code.
(B) Authority
This rule is promulgated pursuant to the authority vested in
the superintendent under sections
3901.041,
3923.44, and
3923.47 of the Revised
Code.
(C) Applicability
This rule applies to long-term care insurance that is intended
to qualify under the state's long-term care partnership program.
(D) Definitions
For purposes of this rule, the definitions set forth in section
3923.41 of the Revised Code and
in rule 3901-4-01 of the Administrative
Code have the same meaning as if such
definitions were fully set forth herein. The term "policy"
also
includes a
certificate issued as evidence of coverage under a group insurance
policy.
(E) Offers of
exchange
(1) Within one hundred eighty days of
the date that an insurer begins to advertise, market, offer, sell or issue
policies that qualify under the state long-term care partnership program, the
insurer shall offer, on a one time basis, in writing, to all existing
policyholders and certificate holders that were issued long-term care coverage
by the insurer on or after August 12, 2002, the option to exchange their
existing long-term care coverage for coverage that is intended to qualify under
the state's long-term care partnership program (partnership plan). The written
offer of exchange may be in electronic or paper copy form and shall include a
long-term care partnership program exchange notification, appendix A to this
rule, or a form that is substantially similar in content.
(2) An exchange occurs when an insurer offers
a policyholder or certificate holder (hereinafter "insured") the option to
replace an existing long-term care insurance policy with a policy that
qualifies as a partnership plan, and the insured accepts the offer to terminate
the existing policy and accepts the new policy. In making an offer to exchange,
an insurer shall comply with all of the following requirements:
(a) The offer
is made on a
nondiscriminatory basis without regard to the age or health status of the
insured;
(b) The offer
remains open for a minimum of ninety days from the
date of electronic transmission or paper copy mailing by the insurer;
(c) At the time the offer is made, the
insurer
provides the insured a copy of appendix A to this
rule or a form that is substantially similar in content; and
(d) The offer and the materials required in
paragraph (E)(2)(c) of this rule
are accessible to insureds in paper copy form
upon request.
(3)
Notwithstanding paragraphs (E)(1) and (E)(2) of this rule,
(a) An offer to exchange may be deferred for
any insured who is currently eligible for benefits under an existing policy or
who is subject to an elimination period on a claim, but such deferral shall
continue only as long as such eligibility or elimination period exists;
and
(b) An offer to exchange does
not have to be made if the insured would be required to purchase additional
benefits to qualify for the state long- term care partnership program and the
insured is not eligible to purchase the additional benefits under the insurer's
new business, long-term care, underwriting guidelines.
(4) If the new policy has an actuarial value
of benefits equal to or lesser than the actuarial value of benefits of the
existing policy, then all of the following apply:
(a) The new policy shall not be underwritten;
and
(b) The rate charged for the
new policy
is determined using the original issue age and risk
class of the insured that was used to determine the rate of the existing
policy.
(5) If the new
policy has an actuarial value of benefits exceeding the actuarial value of the
benefits of the existing policy, then all of the following apply:
(a) The insurer
applies
its new business, long-term care, underwriting guidelines to the increased
benefits only; and
(b) The rate
charged for the new policy
is determined using the method set forth in
paragraph (E)(4)(b) of this rule for the existing benefits, increased by the
rate for the increased benefits using the then current attained age and risk
class of the insured for the increased benefits only.
(6)
(a) The
new policy offered in an exchange shall be on a form that is currently offered
for sale by the insurer in the general market and the effective date of the
partnership plan policy
is the same as the new policy.
(b) For purposes of implementing the exchange
requirement set forth in paragraph (E)(1) of this rule, an insurer may also
implement exchanges via any policy form that the superintendent has approved as
being partnership-qualified, even if that long-term care insurance policy form
is no longer offered or marketed. The superintendent may, at the
superintendent's sole discretion, extend the one hundred eighty day time period
referenced in paragraph (E)(1) of this rule to allow for implementation of
exchanges on a long-term care insurance policy form no longer offered or
marketed.
(7) In the
event of an exchange, the insured shall not lose any rights, benefits or
built-up value that has accrued under the original policy with respect to the
benefits provided under the original policy, including, but not limited to,
rights established because of the lapse of time related to pre-existing
condition exclusions, elimination periods, or incontestability
clauses.
(8) Insurers may complete
an exchange by: issuing a new policy; amending an existing policy with an
endorsement or rider; or revising the schedule of benefits.
(9) The requirements of rule
3901-4-01 of the Administrative
Code shall apply to exchanges including, but not limited to, the requirements
relating to suitability. However, policies issued pursuant to this rule shall
not be considered replacements if issued by the same insurer that issued the
existing policy and shall therefore not be subject to paragraphs (N) and (O) in
rule 3901-4-01 of the Administrative
Code replacement standards.
(10)
The offer of exchange required by paragraph (E) of this rule only applies to
products issued by an insurer that are comparable to the types of policy forms
(e.g. group policies or individual policies) offered by the insurer which are
qualified as partnership plans. For example, if an insurer offers a
comprehensive individual long-term care insurance policy qualified as a
partnership plan, it is only required to offer exchanges to comprehensive
individual long-term care insurance policyholders who were issued coverage on
or after August 12, 2002.
In this example, since only an individual policy is qualified
as a partnership plan, exchange offers would not be required to be made to
group certificate holders under a group policy.
(11) For those insureds with long-term care
insurance policies issued before August 12, 2002, any insurer may offer any
insured an option to exchange an existing policy for a policy that qualifies as
a state long-term care insurance partnership plan. The requirements set forth
in paragraphs (E)(2) to (E)(9) of this rule apply to any such exchange.
(F) Filing requirements for
long-term care insurance partnership program policies.
(1) Any policy that is intended to qualify as
a partnership plan must be filed with the superintendent in accordance with
section 3923.02 of the Revised Code
prior to use, and such filing shall include the partnership program
certification form attached as appendix B to this rule, signed by an officer of
the company.
(2) Insurers intending
to make use of a previously filed qualifying partnership policy shall submit to
the superintendent a partnership program certification form (appendix B to this
rule) signed by an officer of the company with respect to each such policy form
filed. For each policy form, the partnership program certification form
(appendix B to this rule) shall identify the policy by the original form number
and filing date.
(3) If an insurer
intends to amend a previously filed policy with an endorsement or rider in
order to bring the policy into compliance with the partnership program, the
insurer shall file the endorsement or rider with the superintendent prior to
use, and the filing shall include a partnership program certification form
(appendix B to this rule) signed by an officer of the company for each policy
to be amended by the endorsement or rider, which shall include the original
form number and filing date of the previously filed policy.
(4) Insurers using appendix A or appendix C
to this rule do not have to file the forms with the superintendent before use.
However, if the insurer modifies the content of appendix A or appendix C to
this rule or intends to use another form, even though substantially similar in
content, the form must be filed with the superintendent before use.
(G) Modifications to inflation
protection
Modification or elimination of inflation protection after the
date of purchase as specified in divisions (O)(1) to (O)(3) of section
3923.44 of the Revised Code is
not a change that affects the partnership qualified status of a policy that was
qualified under the partnership program as of the date of issue.
(H) The partnership program
disclosure form
For policies intended to qualify under the partnership
program,
(1) The agent or insurer
shall give the consumer a partnership disclosure notice, either using appendix
C to this rule or a notice substantially similar in content, along with the
outline of coverage required by division (I) of section
3923.44 of the Revised Code at
the time of solicitation;
(2) In
the case of a policy issued to a group where an outline of coverage is not
delivered, the agent or insurer shall deliver copies of a partnership
disclosure notice, either using appendix C to this rule or a notice
substantially similar in content, along with the enrollment forms; or
(3) In the case of a life insurance policy
that offers long-term care insurance as a term of the policy or in a rider, the
agent or insurer shall give the consumer a partnership disclosure notice,
either using appendix C to this rule or a notice substantially similar in
content, along with the policy summary at the time of solicitation.
(4) In addition to assuring that either a
copy of appendix C to this rule or a notice substantially similar in content is
provided to the consumer at the time of the initial solicitation, or to the
group at the time the enrollment forms are delivered, the insurer shall also
assure that a copy of appendix C to this rule or a notice substantially similar
in content, is provided no later than partnership policy delivery.
(I) Data reporting
Each insurer offering partnership program policies in this
state shall make regular reports to the United States secretary of health and
human services that include such information as required by law or as the
secretary determines is appropriate for the administration of the partnership
program.
(J) Severability
If any portion of this rule
or the application thereof to any person or circumstance is held invalid, the
invalidity does not affect other provisions or applications of the rule or
related rules which can be given effect without the invalid portion or
application, and to this end the provisions of this rule are
severable.
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