Current through August 26, 2024
(1) PURPOSE. The
purpose of this section is to allow assistance eligible individuals to elect
continued coverage provided under s.
632.897,
Stats., in circumstances where the group policy is discontinued on or after
June 30, 2009, and not replaced. The rule applies only to individuals who are
eligible for a premium subsidy under the federal American Recovery and
Reinvestment Act of 2009 P.L. 111-5, as amended. The
federal act makes the premium subsidy available to those individuals who are
eligible due to an involuntary employment termination prior to June 1,
2010.
(2) DEFINITIONS. In addition
to the definitions in section 9126 of 2009 Wisconsin Act 11, in this section,
unless the context requires otherwise:
(a)
"Assistance eligible individual" has the meaning provided in section 3001 (a)
(3) of the federal act.
(b)
"Federal act" means the American Recovery and Reinvestment Act of 2009,
P.L.
111-5, as amended by section 1010 of the federal
department of defense appropriations act, 2010 (P.L.
111-118), the temporary extension act of 2010 (P.L.
111-144) and the continuing extension act of 2010
(P.L.
111-157).
(c) "Terminated insured" means a n insured
under s.
632.897(1) (f) and (2) (b) 2, Stats., whose employment
has been involuntarily terminated on or after September 1, 2008, and prior to
June 1, 2010, who has been continuously covered under a group policy for at
least 3 months and who satisfies one of the following:
1. Would be entitled to elect continued
coverage under s.
632.897,
Stats., but for the fact that the group policy was discontinued on or after
June 30, 2009, and not replaced by another group policy offered by the employer
during the terminated insured's 30-day election period under s.
632.897(3) (a), Stats.
2. Is receiving, on behalf of themselves and,
if applicable, a spouse or dependents, continued coverage under s.
632.897,
Stats., due to an involuntary termination of employment that occurred on or
after September 1, 2008, but prior to June 1, 2010, and, on or after June 30,
2009, the group policy is discontinued and not replaced by a group policy
offered by the employer.
(3) ADDITIONAL CONTINUATION COVERAGE ELECTION
OPPORTUNITY FOR ASSISTANCE ELIGIBLE INDIVIDUALS WHEN AN EMPLOYER DISCONTINUES
AND DOES NOT REPLACE GROUP POLICY COVERAGE.
(a) Except as provided in pars. (c) and (d),
an insurer shall permit a terminated insured to elect continuation of coverage
under the terms of an employer's group policy if the group policy is
discontinued on or after June 30, 2009.
(b) An insurer shall permit a terminated
insured to elect continuation of coverage on behalf of themselves and the
terminated insured's spouse and dependents if the spouse or dependents were
covered under the group policy at the time the group policy was
discontinued.
(c) An insurer may
limit continuation of coverage under this section to individuals who are under
the federal act who are assistance eligible individuals.
(d) This section does not require
continuation of coverage if the individual satisfies all of the following:
1. Establishes residence outside this
state.
2. Fails to make timely
payment of a required premium amount after notice as required under s.
631.36(2) (b), Stats.
3. Becomes eligible for similar coverage
under another employer's group policy or for benefits under title XVIII of the
Social Security Act.
4. Ceases to
be eligible for premium assistance under section 3001 (a) (2) of the federal
act.
5. The individual's
eligibility for continued coverage would have otherwise ceased under s.
632.897,
Stats., if the group policy had not been discontinued.
(e) Coverage under this section, if elected
under par. (a), shall continue uninterrupted from the date of the employer's
discontinuance of the group policy. An insurer is not required to continue
coverage for a period covered by a conversion policy issued under s.
632.897,
Stats., for the period prior to the date of election of continuation
coverage.
(f) An insurer shall
provide a right to an individual conversion policy on termination of
continuation of coverage under this section if the terminated insured tenders
the first premium within 30 days after the continued coverage terminates. The
insurer shall either include notice of this right and a description of how to
make payment of premium in the notice required under sub. (4) (b) or shall
provide notice prior to termination of the continuation coverage. The
conversion policy shall conform to the requirements of s.
632.897(4),
Stats. An insurer is not required to issue a conversion policy under this
paragraph if issuance of an individual conversion policy is not required under
the standards established in s.
632.897(4) (d), Stats.
(4) NOTICE.
(a) An employer shall provide written notice
in the form required by par. (b) to each terminated insured prior to the date
of discontinuance of the group policy. An employer or insurer is not required
to give notice to a terminated insured who is not, or who is not entitled to
elect coverage for, an assistance eligible individual.
(b) The notice required under this subsection
shall include a description of the discontinuance of the group policy; the
right to continuation under sub. (3) (a) and (b); an explanation of the
procedure for electing continued coverage; the payment amounts required for
continuation coverage; and the manner, place, and time in which the payments
shall be paid. The notice shall also include a description of the premium
subsidy, the notice required under section 3001 (a) (7) of the federal act, and
a description of when the continuation coverage will discontinue, including a
description of discontinuance under sub. (3) (d) 4.
(c) If an employer that is required to
provide the notice as required under pars. (a) and (b) fails to provide the
notice within the time required, the insurer shall provide the notice specified
in par. (b) within 10 days after the date the insurer acquires knowledge the
employer has not provided the notice or the date the insurer exercising due
diligence should know that the employer has not provided the notice.
(d) Insurance intermediaries shall provide
reasonable assistance to insurers by notifying employers of the requirement to
provide notice under this subsection and by making reasonable efforts to assist
insurers in determining whether the employer complies and, if not, by making
reasonable efforts to assist the insurer in giving notice.
(e) A terminated insured may elect
continuation of coverage by electing continuation coverage and paying the
premium due under sub. (5) (a) to either the employer or the insurer, as
directed by the notice required under par. (b), within 30 days after notice is
given as required under par. (a) or (c).
(5) PREMIUM.
(a) The insurer may charge for coverage
continued under this section an amount no more than 100% of the cost the
employer incurred for providing the group policy coverage, including group rate
adjustments on the date the group policy would have renewed that are based on
applying rating factors to group changes that occurred prior to the
discontinuance of the group policy. The employer or insurer shall collect only
35% of that amount from the terminated insured. The insurer may collect any
premium subsidy available under the federal act.
(b) An insurer may require payment of premium
for all required continuation coverage periods, including for periods prior to
the date of election.
(c) An
employer, if requested by the insurer, shall collect and remit to the insurer
premium due under this section. An insurer may require the employer to collect
and remit premium due from a terminated insured, spouse, or dependent under
this section. An insurer may not condition continuation of coverage on the
employer collection and remittance of premium. An insurer shall treat payment
by a terminated insured, spouse, or dependent to the employer as receipt and
payment to the insurer unless the insurer directs that payment be made to the
insurer. An insurer may direct a terminated insured, spouse, or dependent to
pay the premium to either the employer or to the insurer, including by
direction in the notice under sub. (4) (b).
(d) An employer must notify an insurer when
the employer discontinues a group policy and does not replace the group policy.
An insurer may require the employer to give it notice when it discontinues a
group policy and does not replace the group policy. An insurer may not
condition continuation of coverage under this section on employer notice of
such discontinuance.
(6)
PORTABILITY. For an individual who elects continuation of coverage under this
section, the period, if any, from the date of the termination of the
individual's group policy coverage to the commencement of continuation of
coverage under this section shall be disregarded for the purpose of determining
the 63-day period under s.
632.746(3) (b), Stats.
(7) CONTRACT TERMS PRESERVED. An insurer may
restrict coverage provided under this section to the terms of the group policy
to the extent the terms do not conflict with this section. Nothing in this
section prohibits an insurer from applying deductibles and other cost sharing
according to the terms of the group policy, including according to policy
periods based on renewal dates that would have occurred had the policy not been
discontinued. An insurer may apply policy modifications that were included in
notice given to the employer under s.
631.36,
Stats., or requested by the employer, that took effect or would have taken
effect prior to or on the date of the discontinuance of the policy. An insurer
may include provisions for administration of this section in its group policy
and certificates.
(8) EXTENDED
PREMIUM PAYMENT RIGHT, COVERAGE, AND NOTICE PURSUANT TO SECTION 1010 OF THE
FEDERAL DEPARTMENT OF DEFENSE APPROPRIATIONS ACT, 2010. An insurer must provide
the rights provided by, and must comply with the provisions of, section 1010
(c) of the federal department of defense appropriation act, 2010 (P.L.
111-118), for assistance eligible individuals who
are or were eligible for coverage under this section or s.
632.897,
Stats., including:
(a) The rules relating to
2009 extension, including the right to elect to pay premiums retroactively and
maintain coverage under this section or s.
632.897,
Stats.
(b) The rules relating to
notification as provided under section 1010 (c) of the federal department of
defense appropriation act, 2010 (P.L.
111-118), as amended.
