Maryland Insurance Section 15-1206
§ 15-1206.
CAUTION: READ FULL TEXT OF SECTION FOR SPECIAL NOTE
(a) (1) A carrier may not arbitrarily transfer a small employer involuntarily into or out of a health benefit plan.
(2) A carrier may not offer to transfer a small employer into or out of a health benefit plan unless the offer to transfer is made to all small employers with similar risk adjustment factors.
(b) A carrier shall make a reasonable disclosure in its solicitation and sales materials of:
(1) the provisions that relate to the carrier's right to change premium rates, including any factors that may affect the changes in premium rates;
(2) the provisions that relate to renewability of policies and contracts;
(3) the provisions that relate to preexisting conditions; and
(4) the provisions of § 15-1209 of this subtitle that require an employer to make dependent coverage available to eligible employees but do not require the employer to make a contribution to the premium payments for that dependent coverage.
(c) (1) Subject to the approval of the Commissioner and as provided under this subsection and § 15-1209(f) of this subtitle, a carrier may impose reasonable minimum participation requirements.
(2) A carrier may not impose a requirement for minimum participation by the eligible employees of a small employer that is greater than 75%.
(3) In applying a minimum participation requirement to determine whether the applicable percentage of participation is met, a carrier may not consider as eligible employees those who have group spousal coverage under a public or private plan of health insurance or another employer's health benefit arrangement, including Medicare, Medicaid, and CHAMPUS, that provides benefits similar to or exceeding the benefits provided under the Standard Plan.
(4) A carrier may not impose a minimum participation requirement for a small employer group if any member of the group participates in a medical savings account.
(d) (1) On or before March 15 of each year, each carrier shall file an actuarial certification with the Commissioner.
(2) The actuarial certification shall be written in a form that the Commissioner approves, by a member of the American Academy of Actuaries or another person acceptable to the Commissioner and shall state that the carrier is in compliance with this subtitle and has followed the rating practices imposed under § 15-1205 of this subtitle.
(3) The actuarial certification shall be based on an examination that includes a review of appropriate records and actuarial assumptions and methods used by the carrier.
(e) (1) To indicate compliance with subsections (b) and (c)(1) of this section and § 15-1205(d) of this subtitle, a carrier shall maintain information and documentation that is satisfactory to the Commissioner.
(2) A carrier shall:
(i) retain all information and documentation required under this subtitle at its principal place of business for a period of 5 years; and
(ii) make the information and documentation available to the Commissioner on request.
(f) A carrier may not implement a producer commission schedule that varies the amount of a commission based on the size of a small employer group unless the variation:
(1) is inversely related to the size of the small employer group;
(2) applies to the cumulative premium paid over a specific period of time, is uniformly applied, and is inversely related to the cumulative premium paid during the period of time; or
(3) is established by a contract between the carrier and each outside producer, and the carrier:
(i) specifies in the contract the group size to which the variation applies;
(ii) directs the outside producer to refer small employers of the specified size to an employee of the carrier who is a licensed producer or to a company affiliated with the carrier through common ownership within an insurance holding company; and
(iii) pays a commission to the employee producer described in item (ii) of this item.
// SPECIAL NOTE: THE ABOVE SECTION WAS CHANGED BY CHAPTER 287 OF 2004 AND WILL REMAIN IN EFFECT UNTIL JUNE 30, 2008 //
(a) (1) A carrier may not arbitrarily transfer a small employer involuntarily into or out of a health benefit plan.
(2) A carrier may not offer to transfer a small employer into or out of a health benefit plan unless the offer to transfer is made to all small employers with similar risk adjustment factors.
(b) A carrier shall make a reasonable disclosure in its solicitation and sales materials of:
(1) the provisions that relate to the carrier's right to change premium rates, including any factors that may affect the changes in premium rates;
(2) the provisions that relate to renewability of policies and contracts;
(3) the provisions that relate to preexisting conditions; and
(4) the provisions of § 15-1209 of this subtitle that require an employer to make dependent coverage available to eligible employees but do not require the employer to make a contribution to the premium payments for that dependent coverage.
(c) (1) Subject to the approval of the Commissioner and as provided under this subsection and § 15-1209(d) of this subtitle, a carrier may impose reasonable minimum participation requirements.
(2) A carrier may not impose a requirement for minimum participation by the eligible employees of a small employer that is greater than 75%.
(3) In applying a minimum participation requirement to determine whether the applicable percentage of participation is met, a carrier may not consider as eligible employees those who have group spousal coverage under a public or private plan of health insurance or another employer's health benefit arrangement, including Medicare, Medicaid, and CHAMPUS, that provides benefits similar to or exceeding the benefits provided under the Standard Plan.
(4) A carrier may not impose a minimum participation requirement for a small employer group if any member of the group participates in a medical savings account.
(d) (1) On or before March 15 of each year, each carrier shall file an actuarial certification with the Commissioner.
(2) The actuarial certification shall be written in a form that the Commissioner approves, by a member of the American Academy of Actuaries or another person acceptable to the Commissioner and shall state that the carrier is in compliance with this subtitle and has followed the rating practices imposed under § 15-1205 of this subtitle.
(3) The actuarial certification shall be based on an examination that includes a review of appropriate records and actuarial assumptions and methods used by the carrier.
(e) (1) To indicate compliance with subsections (b) and (c)(1) of this section and § 15-1205(d) of this subtitle, a carrier shall maintain information and documentation that is satisfactory to the Commissioner.
(2) A carrier shall:
(i) retain all information and documentation required under this subtitle at its principal place of business for a period of 5 years; and
(ii) make the information and documentation available to the Commissioner on request.
(f) A carrier may not implement a producer commission schedule that varies the amount of a commission based on the size of a small employer group unless the variation:
(1) is inversely related to the size of the small employer group;
(2) applies to the cumulative premium paid over a specific period of time, is uniformly applied, and is inversely related to the cumulative premium paid during the period of time; or
(3) is established by a contract between the carrier and each outside producer, and the carrier:
(i) specifies in the contract the group size to which the variation applies;
(ii) directs the outside producer to refer small employers of the specified size to an employee of the carrier who is a licensed producer or to a company affiliated with the carrier through common ownership within an insurance holding company; and
(iii) pays a commission to the employee producer described in item (ii) of this item.
