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2010 Wyoming Statutes
Title 26 - Insurance Code
Chapter 19 - Group And Blanket Disability Insurance

CHAPTER 19 - GROUP AND BLANKET DISABILITY INSURANCE

ARTICLE 1 - IN GENERAL

26-19-101. Scope and applicability of article; short title.

(a) This article applies only to group disability and blanket disability insurance contracts.

(b) This article may be cited as the "Group and Blanket Disability Insurance Law".

(c) This article does not apply to any contract made or issued prior to January 1, 1968, nor to any extensions, renewals, reinstatements or modifications of or amendments to any contract whenever made.

26-19-102. "Group disability insurance" defined; eligible groups.

(a) "Group disability insurance" means that form of disability insurance covering groups of persons as described in this section and W.S. 26-19-110, with or without one (1) or more members of their families or one (1) or more of their dependents, or covering one (1) or more members of the families or one (1) or more dependents of the groups of persons. Except as provided in W.S. 26-19-110, a group disability insurance policy shall not be issued for delivery in this state unless the policy is issued to:

(i) An employer or trustees of a fund established or adopted by an employer, which employer or trustee is deemed the policyholder, insuring the employer's employees for the benefit of persons other than the employer, subject to the following requirements:

(A) All employees or any class of employees are eligible for insurance under the terms of the policy;

(B) The policy may define "employees" to include:

(I) The officers, managers and employees of the employer;

(II) The individual proprietor or partner if the employer is an individual proprietor or partnership;

(III) The officers, managers and employees of subsidiary or affiliated corporations;

(IV) The individual proprietors, partners and employees of individuals and firms, if the business of the employer and the individual or firm is under common control through stock ownership, contract, or otherwise;

(V) Retired employees;

(VI) Former employees;

(VII) Directors of a corporate employer;

(VIII) Elected or appointed officials;

(IX) The trustees, their employees, or both, if their duties are principally connected with the trusteeship.

(C) If the insured employee does not pay any part of the premium for his insurance, the policy shall insure all eligible employees, except those who reject the coverage in writing.

(ii) An association, or a trust or the trustee of a fund established or adopted for the benefit of members of one (1) or more associations. The association shall have at the time the policy is first issued a minimum of fifty (50) persons eligible for insurance, shall have a constitution and bylaws which provide that the association holds regular meetings not less than annually to further the members' purposes, that the association, except for credit unions, collects dues or solicits contributions from members, and that the members have voting privileges and representation on the governing board and committees. Prior to marketing or offering any group disability insurance to an association formed for the sole purpose of obtaining insurance, the producer shall file a written report with the department setting forth the name of the association, the insurer and its address and the offering producer and his address. The department shall keep the name of the association confidential. The provisions of the Small Employer Health Insurance Availability Act, W.S. 26-19-301 et seq., shall apply to all insurance issued to an association under this section. The policy is subject to the following requirements:

(A) The policy may insure one (1) or more of the following or all of any class of the following for the benefit of persons other than the employee's employer:

(I) Members of the association;

(II) Employees of the association; or

(III) Employees of members.

(B) If the covered person does not pay any part of the premium for his insurance, the policy shall insure all eligible persons, except those who reject the coverage in writing.

(iii) A trust or the trustees of a fund established or adopted by two (2) or more employers, by one (1) or more labor unions or similar employee organizations, or by one (1) or more employers and one (1) or more labor unions or similar employee organizations, which trust or trustees are deemed the policyholder, to insure employees of the employers or members of the union or organization for the benefit of persons other than the employers, unions or organizations, subject to the following requirements:

(A) All employees of the employers, members of the unions or organizations or any class of the employers, union members or organization members are eligible for insurance under the terms of the policy;

(B) The policy may provide that the term "employees" shall include:

(I) The employees of one (1) or more subsidiary corporations and the employees, individual proprietors and partners of one (1) or more affiliated corporations, proprietorships or partnerships if the business of the employer and of the affiliated corporations, proprietorships or partnerships is under common control;

(II) Retired or former employees;

(III) Directors of a corporate employer;

(IV) The trustees, trustees' employees, or both, if their duties are principally connected with the trusteeship.

(C) If the insured person does not pay any part of the premium for his insurance, the policy shall insure all eligible persons, except those who reject such coverage in writing.

(iv) Under a policy issued to any person or organization to which a policy of group life insurance may be issued or delivered in this state to insure any class or classes of individuals that could be insured under the group life policy;

(v) Repealed by Laws 1990, ch. 5, 3.

(vi) A creditor, a creditor's parent holding company or a trustee or agent designated by two (2) or more creditors, which creditor, holding company, affiliate, trustee or agent is deemed the policyholder, to insure debtors of the creditor concerning their indebtedness, subject to the following requirements:

(A) All debtors or any class of debtors of the creditor are eligible for insurance under the terms of the policy;

(B) The policy may provide that the term "debtors" shall include:

(I) Borrowers of money or purchasers or lessees of goods, services or property for which payment is arranged through a credit transaction;

(II) The debtors of one (1) or more subsidiary corporations; and

(III) The debtors of one (1) or more affiliated corporations, proprietorships or partnerships if the business of the policyholder and of the affiliated corporations, proprietorships or partnerships is under common control.

(C) If the insured debtor does not pay any part of the premium for his insurance, the policy shall insure all eligible debtors;

(D) The total amount of insurance payable for an indebtedness shall not exceed the greater of the scheduled or actual amount of unpaid indebtedness to the creditor. The insurer may exclude any payments which are delinquent on the date the debtor is disabled as defined in the policy;

(E) The insurance may be payable to the creditor or any successor to the right, title and interest of the creditor. The payment shall reduce or extinguish the unpaid indebtedness of the debtor to the extent of the payment and any excess of the insurance is payable to the insured or the estate of the insured;

(F) Notwithstanding subparagraphs (A) through (D) of this paragraph, insurance on agricultural credit transaction commitments may be written up to the amount of the loan commitment. Insurance on educational credit transaction commitments may be written up to the amount of the loan commitment less the amount of any repayments made on the loan.

(vii) A credit union or a trustee or agent designated by two (2) or more credit unions, which credit union, trustee or agent is deemed the policyholder, to insure members of the credit union for the benefit of persons other than the credit union, trustee, agent or any of their officials, subject to the following requirements:

(A) All members or all of any class of members of the credit union are eligible for insurance under the terms of the policy;

(B) Policy premiums shall be paid by the policyholder from the credit union's funds and shall insure all eligible members.

(viii) A labor union or similar employee organization which union or organization is deemed the policyholder, to insure members of the union or organization for the benefit of persons other than the union or organization or any of its officials, representatives or agents, subject to the following requirements:

(A) All members or any class of members of the union or organization are eligible for insurance under the terms of the policy;

(B) If the insured member does not pay any part of the premium for his insurance, the policy shall insure all eligible members, except those who reject such coverage in writing.

26-19-103. Repealed by Laws 1990, ch. 5, 3.

26-19-104. Repealed by Laws 1990, ch. 5, 3.

26-19-105. Readjustment of premiums; dividends.

Any group disability insurance contract may provide for the readjustment of the rate of premium based upon the experience under the contract. If a policy dividend is declared or a reduction in rate is made or continued for the first or any subsequent year of insurance under any group disability insurance policy issued to any policyholder, the excess, if any, of the aggregate dividends or rate reductions under the policy and all other group insurance policies of the policyholder over the aggregate expenditure for insurance under those policies made from funds contributed by the policyholder, or by an employer of insured persons, or by a union or association to which the insured persons belong, including expenditures made in connection with administration of the policies, shall be applied by the policyholder for the sole benefit of insured employees or members.

26-19-106. Blanket disability insurance; defined.

(a) Blanket disability insurance is that form of disability insurance covering groups of persons under a policy or contract issued to:

(i) Any common carrier or to any operator, owner or lessee of a means of transportation, who is deemed the policyholder, covering a group of persons who may become passengers as defined by reference to their travel status on the common carrier or the means of transportation;

(ii) An employer, who is deemed the policyholder, covering any group of employees, dependents or guests, defined by reference to specified hazards incident to an activity or activities or operations of the policyholder;

(iii) A college, school or other institution of learning, a school district or school jurisdictional unit, or to the head, principal or governing board of any educational unit, who is deemed the policyholder, covering students, teachers or employees;

(iv) Any religious, charitable, recreational, educational or civic organization, or branch thereof, which is deemed the policyholder, covering any group of members or participants defined by reference to specified hazards incident to an activity or operations sponsored or supervised by the policyholder;

(v) A sports team, camp or sponsor thereof, which is deemed the policyholder, covering members, campers, employees, officials or supervisors;

(vi) Any volunteer fire department, first aid, civil defense or other similar volunteer organization, which is deemed the policyholder, covering any group of members or participants defined by reference to specified hazards incident to an activity or operations sponsored or supervised by the policyholder;

(vii) A newspaper or other publisher, which is deemed the policyholder, covering its carriers;

(viii) An association, including a labor union, which has a constitution and bylaws and which is deemed the policyholder, covering any group of members or participants defined by reference to specified hazards incident to an activity or operations sponsored or supervised by the policyholder. Prior to marketing or offering any blanket disability insurance to an association, including a labor union, formed for the sole purpose of obtaining insurance, the producer shall file a written report with the department setting forth the name of the association, the insurer and its address and the offering producer and his address. The department shall keep the name of the association confidential. The provisions of the Small Employer Health Insurance Availability Act, W.S. 26-19-301 et seq., shall apply to all insurance issued to an association under this section;

(ix) Cover any other risk or class of risks which, in the commissioner's discretion, may be properly eligible for blanket disability insurance. The commissioner's discretion may be exercised on an individual risk basis or class of risks, or both.

26-19-107. Group disability and blanket insurance standard provisions; exceptions.

(a) A policy of group disability or blanket disability insurance shall not be delivered in this state unless it contains in substance the following provisions or provisions which in the commissioner's opinion are more favorable to the persons insured or at least as favorable to the persons insured and more favorable to the policyholder:

(i) The policy, including endorsements and a copy of the application, if any, of the policyholder and the persons insured constitutes the entire contract between the parties;

(ii) Written notice of a claim shall be given to the insurer within twenty (20) days after the occurrence or commencement of any loss covered by the policy. Failure to give notice within the time provided by this paragraph shall not invalidate nor reduce any claim if it is shown it was not reasonably possible to give notice and that notice was given as soon as was reasonably possible;

(iii) The insurer shall furnish either to the person making a claim or to the policyholder for delivery to the person making a claim the forms it usually furnishes for filing proof of loss. If the forms are not furnished before the expiration of fifteen (15) days after giving of the notice specified in paragraph (ii) of this subsection, the person making the claim is deemed to have complied with the requirements of the policy as to proof of loss upon submitting, within the time fixed in the policy for filing proof of loss, written proof covering the occurrence, the character and the extent of the loss for which claim is made;

(iv) In the case of claim for loss of time for disability, written proof of the loss shall be furnished to the insurer within ninety (90) days after the commencement of the period for which the insurer is liable. Subsequent written proofs of the continuance of the disability shall be furnished to the insurer at any intervals the insurer reasonably requires. In the case of claim for any other loss, written proof of the loss shall be furnished to the insurer within ninety (90) days after the date of the loss. Failure to furnish proof within the time provided by this paragraph shall not invalidate nor reduce any claim if it is shown it was not reasonably possible to furnish proof and that proof was furnished as soon as was reasonably possible;

(v) Any benefits payable under the policy are payable as follows:

(A) Benefits other than benefits for loss of time are payable not more than forty-five (45) days after receipt of written proof of the loss and supporting evidence;

(B) Subject to proof of loss and supporting evidence, all accrued benefits payable under a policy for loss of time are payable not less frequently than monthly during the continuance of the disability period for which the insurer is liable, and any balance remaining unpaid at the termination of the disability period is payable immediately upon receipt of proof and supporting evidence.

(vi) The insurer, at its own expense, may:

(A) Examine the person of the insured when and as often as it reasonably requires during the pendency of claim under the policy; and

(B) Make an autopsy if it is not prohibited by law.

(vii) No action at law or in equity shall be brought to recover under the policy prior to the expiration of sixty (60) days after written proof of loss is furnished in accordance with the requirements of the policy and no action shall be brought upon the expiration of three (3) years after the time written proof of loss is required to be furnished;

(viii) The policyholder is entitled to a grace period of thirty-one (31) days for the payment of any premium due except the first, and during the grace period the policy shall continue in force unless the policyholder gave the insurer written notice of discontinuance in advance of the date of discontinuance and in accordance with the terms of the policy. The policy may provide that the policyholder is liable to the insurer for the payment of a pro rata premium for the time the policy was in force during the grace period provided by this paragraph;

(ix) The validity of the policy shall not be contested except for nonpayment of premiums after it has been in force for two (2) years from the date of issue, and no statement made by any person covered under the policy relating to insurability shall be used in contesting the validity of the insurance with respect to which the statement was made after the insurance has been in force prior to the contest for a period of two (2) years during the person's lifetime unless the statement is contained in a written instrument signed by the person making the statement;

(x) A copy of the application, if any, of the policyholder shall be attached to the policy when issued. All statements made by the policyholder or by the persons insured are deemed representations and not warranties. No statement made by any person insured shall be used in any contest unless a copy of the instrument containing the statement is or has been furnished to the person or, in the event of the death or incapacity of the insured person, to the individual's beneficiary or personal representative;

(xi) The additional exclusions or limitations, if any, applicable under the policy concerning a disease or physical condition of a person, not otherwise excluded from the person's coverage by name or specific description effective on the date of the person's loss, which existed prior to the effective date of the person's coverage under the policy shall be specified. The exclusion or limitation shall not exclude coverage for a period beyond twelve (12) months following the individual's effective date of coverage and shall only relate to conditions for which medical advice, diagnosis, care or treatment was recommended or received during the six (6) months immediately preceding the effective date of coverage. In determining whether a preexisting condition provision applies to an insured or dependent, all private or public health benefit plans shall credit the time the person was previously covered by a private or public health benefit plan if the previous coverage was continuous to a date not more than ninety (90) days prior to the effective date of the new coverage exclusive of any applicable waiting period. In the case of a preexisting conditions limitation allowable in the succeeding carrier's plan, the level of benefits applicable to preexisting conditions of persons becoming covered by the succeeding carrier's plan during the period of time this limitation applies under the new plan shall be the lesser of:

(A) The benefits of the new plan determined without application of the preexisting conditions limitation; or

(B) The benefits of the prior plan.

(xii) If the premiums or benefits vary by age, a provision shall specify an equitable adjustment of premiums, benefits, or both, to be made if the age of a covered person has been misstated and containing a clear statement of the method of adjustment to be used;

(xiii) The insurer shall issue to the policyholder for delivery to each person insured a certificate containing a statement of the insurance protection to which that person is entitled, to whom the insurance benefits are payable and of any family member's or dependent's coverage;

(xiv) Benefits for loss of life of the person insured are payable to the beneficiary designated by the person insured or if the policy contains conditions pertaining to family status the beneficiary may be the family member specified by the policy terms. Payment of benefits for loss of life of the person insured is subject to the provisions of the policy in the event no designated or specified beneficiary is living at the death of the person insured. All other benefits of the policy are payable to the person insured. The policy may provide that if any benefit is payable to the estate of a person or to a person who is a minor or otherwise not competent to give a valid release, the insurer may pay the benefit, up to an amount not exceeding five thousand dollars ($5,000.00), to any relative by blood, marriage or adoption of the person deemed by the insurer to be equitably entitled to the benefits;

(xv) For a policy insuring debtors, the insurer shall furnish the policyholder for delivery to each debtor insured under the policy a certificate of insurance describing the coverage and specifying that the benefits payable shall first be applied to reduce or extinguish the indebtedness;

(xvi) Repealed By Laws 1997, ch. 120, 2.

(xvii) If issued or delivered on or after January 1, 1999, the policy shall provide a notice on the face of the policy of not less than fourteen (14) point bold type, as to the extent to which the policy includes comprehensive adult wellness benefits as defined in subsection (h) of this section. To insure that the disclosure has been made, the notice shall include space for the signature of the policyholder and the sales representative on the disclosure statement. The disclosure statement must be signed by the applicant and sales representative at the time of the policy application. No policy shall be represented as containing comprehensive adult wellness benefits unless the policy meets the criteria specified under subsection (h) of this section. If coverage is included, the notice shall make reference to the exact location within the policy where the level and extent of coverage is described in detail. If coverage is not included, the notice shall state that the policy does not contain comprehensive adult wellness benefits as defined by law. This statement shall also be placed in a prominent location on any materials used in representing the policy, including sales materials. The department of insurance shall prescribe the form and content of the notice required under this paragraph. This paragraph does not apply to any policy with a deductible of five thousand dollars ($5,000.00) or more.

(b) W.S. 26-19-107(a)(xi), (xiii) and (xiv) shall not apply to policies insuring debtors.

(c) The standard provisions for individual disability insurance policies shall not apply to group disability insurance policies.

(d) If any provision of this section is entirely or partially inapplicable to or inconsistent with the coverage provided by a particular form of policy, the insurer with the approval of the commissioner shall omit from the policy any inapplicable provision or part of a provision and shall modify any inconsistent provision or part of the provision to conform the policy provision with the coverage provided by the policy.

(e) Repealed By Laws 1997, ch. 120, 2.

(f) No policy of group or blanket disability insurance shall treat the following as a preexisting condition:

(i) Pregnancy existing on the effective date of coverage;

(ii) Genetic information, in the absence of a diagnosis of a condition related to the genetic information.

(g) A policy of group or blanket disability insurance shall not establish rules for eligibility, including continued eligibility, of any individual to enroll under the policy based on any of the following health status related factors in relation to the employee or an eligible dependent:

(i) Health status;

(ii) Medical condition, including both physical and mental illness;

(iii) Claims experience;

(iv) Receipt of health care;

(v) Medical history;

(vi) Genetic information;

(vii) Evidence of insurability, including conditions arising out of acts of domestic violence;

(viii) Disability.

(h) As used in paragraph (a)(xvii) of this section, "comprehensive adult wellness benefits" means benefits not subject to policy deductibles, which provide a minimum benefit equal to eighty percent (80%) of the reimbursement allowance under the private health benefit plan with a maximum of twenty percent (20%) coinsurance by the insured and which provide a benefit structure to the insured equal to a minimum of one hundred fifty dollars ($150.00) per insured adult per calendar year, or a benefit structure of similar actuarial value to the insured. In addition, the benefits shall at minimum provide for testing procedures and for the examination of adult policyholders and their spouses for breast cancer, prostate cancer, cervical cancer and diabetes.

(j) All group and blanket disability insurance policies providing coverage on an expense incurred basis, group service or indemnity type contracts issued by a nonprofit corporation, group service contracts issued by a health maintenance organization, all self-insured group arrangements to the extent not preempted by federal law and all managed health care delivery entities of any type or description, that are delivered, issued for delivery, continued or renewed on or after July 1, 2001, and providing coverage to any resident of this state shall provide benefits or coverage for:

(i) A pelvic examination and pap smear for any nonsymptomatic women covered under the policy or contract;

(ii) A colorectal cancer examination and laboratory tests for cancer for any nonsymptomatic person covered under the policy or contract;

(iii) A prostate examination and laboratory tests for cancer for any nonsymptomatic man covered under the policy or contract; and

(iv) A breast cancer examination including a screening mammogram and clinical breast examination for any nonsymptomatic person covered under the policy or contract.

(k) To encourage public health and diagnostic health screenings, the services covered under subsection (j) of this section shall be provided with no deductible due and payable. A health plan shall, at a minimum, be liable for eighty percent (80%) of the reimbursement allowance of the health plan up to a maximum of two hundred fifty dollars ($250.00) per adult insured per year. A patient shall be liable for coinsurance up to twenty percent (20%) if such coinsurance is required pursuant to the patient's health care coverage. Coverage may be in addition to any other preventive care services. This subsection shall apply to private health benefit plans as defined by W.S. 26-1-102(a)(xxxiii) except that it shall not apply to high deductible policies where the deductible equals or exceeds one thousand dollars ($1,000.00) per person or per family per year or policies qualifying as federal medical savings accounts.

(m) In addition to the prohibitions on the use of genetic information provided in paragraph (g)(vi) of this section, an insurer offering a policy of group or blanket disability insurance shall not, based on the genetic testing information of an individual or a family member of an individual:

(i) Deny eligibility;

(ii) Adjust premium rates;

(iii) Adjust contribution rates;

(iv) Request or require predictive genetic testing information concerning an individual or a family member of the individual, except the insurer may request, but not require, predictive genetic testing information if needed for diagnosis, treatment or payment. As part of a request under this paragraph, the plan or issuer shall provide a description of the procedures in place to safeguard confidentiality of the information.

26-19-108. Group disability and blanket insurance standard provisions; application and certificate need not be furnished.

An individual application need not be required from a person covered under a blanket disability policy or contract, nor is it necessary for the insurer to furnish each person a certificate.

26-19-109. To whom benefits are payable.

(a) Any benefits under any group or blanket disability policy or contract are payable to the person insured, or to his designated beneficiary or beneficiaries, or to his estate, except that if the person insured is a minor or otherwise not competent to give a valid release, the benefits may be made payable to his parent, guardian or other person actually supporting him. The policy may provide that any indemnities provided by the policy because of hospital, nursing, medical or surgical services, at the insurer's option and unless the insured requests otherwise in writing not later than the time of filing proofs of loss, may be paid directly to the hospital or person rendering the services. The policy may not require that the service be rendered by a particular hospital or person. Any payment made under the policy discharges the insurer's obligation with respect to the amount of insurance so paid.

(b) Any group disability policy which contains provisions for the insurer to pay benefits for expenses incurred for hospital, nursing, medical or surgical services for members of the family or dependents of a person insured may provide for the continuation of the benefit provisions entirely or partially after the death of the person insured.

26-19-110. Additional disability insurance groups; requirements.

(a) Group disability insurance offered to a resident under a group disability insurance policy issued to a group other than one described in W.S. 26-19-102 is subject to the following requirements:

(i) A group disability insurance policy shall not be delivered in this state unless the commissioner finds that:

(A) The issuance of the group policy is not contrary to the best interest of the public;

(B) The issuance of the group policy would result in economies of acquisition or administration;

(D) The insurer possesses and maintains capital and surplus requirements provided by W.S. 26-3-108 and reserve requirements provided by W.S. 26-6-107.

(ii) Group disability insurance coverage shall not be offered in this state by an insurer under a policy issued in another state unless the commissioner determines the requirements of paragraph (i) of this subsection are met and the insurer files with the commissioner:

(A) A copy of the group master contract;

(B) A copy of the statute of the state where the group policy is issued that authorizes the issuance of the group policy;

(D) Copies of all supportive material used by the insurer to secure approval of the group in the state where the group policy is issued.

(iii) If the commissioner fails to make the determination provided by paragraph (ii) of this subsection within forty-five (45) days of filing by the insurer of the documents required by paragraph (ii) of this subsection, the requirements of paragraph (i) of this subsection are deemed to be met.

26-19-111. Notice of compensation.

(a) The insurer shall distribute to prospective insureds a written notice that compensation shall or may be paid for a program of group insurance which would qualify under W.S. 26-19-102(a)(ii) or 26-19-110, if compensation of any kind shall or may be paid to:

(i) A policyholder or sponsoring or endorsing entity in the case of group policy; or

(ii) A sponsoring or endorsing entity in the case of individual, blanket or franchise policies marketed by means of direct response solicitation.

(b) Notice required by this section shall be distributed:

(i) Whether compensation is direct or indirect; and

(ii) Whether compensation is:

(A) Paid to or retained by the policyholder or sponsoring or endorsing entity; or

(B) Paid to or retained by a third party at the direction of the policyholder, sponsoring or endorsing entity or an entity affiliated by way of ownership, contract or employment.

(c) The notice required by this section shall be placed on or accompany any application or enrollment form provided to prospective insureds.

(d) As used in this section:

(i) "Direct response solicitation" means a solicitation through a sponsoring or endorsing entity by the mails, telephone or other mass communications media; and

(ii) "Sponsoring or endorsing entity" means an organization which has arranged for the offering of a program of insurance in a manner which communicates that eligibility for participation in the program is dependent upon affiliation with the organization or that it encourages participation in the program.

26-19-112. Dependent group disability insurance.

Except for a policy issued under W.S. 26-19-102(a)(vi), a group disability insurance policy may be extended to insure the employees' or members' or any class of employees' or members' family members or dependents. If the employee or member does not pay any part of the premium for the family members or dependents coverage, the policy shall insure all eligible employees, members or any class of employees or members.

26-19-113. Continuation of group coverage after termination of employment or membership.

(a) A non-COBRA group policy or certificate of insurance on a master policy of a group delivered or issued for delivery in this state on or after July 1, 1995, issued by any insurance company, nonprofit health service corporation, health maintenance organization or any other insurer that provides hospital, surgical or major medical expense insurance or any accommodation of these coverages on an expense incurred basis, but not a policy that provides benefits for specific diseases or for accidental injuries only, shall provide that employees, members or their covered eligible dependents whose insurance under the group policy would otherwise terminate because of termination of employment or membership or eligibility for coverage are entitled to continue their hospital, surgical and major medical insurance under that group policy, for themselves, their eligible dependents or both, subject to all of the group policy's terms and conditions applicable to those forms of insurance and to the following conditions:

(i) Continuation is only available to an employee or member who has been continuously insured under the group policy and for similar benefits under any group policy which it replaced, during the entire three (3) month period ending with the termination of eligibility;

(ii) Continuation is not available for any person who is:

(A) Covered by medicare, excluding his spouse or dependent children who shall be entitled to continuation; or

(B) Covered by any other insured or uninsured arrangement which provides hospital, surgical or medical coverage for individuals in a group.

(iii) Continuation need not include dental or vision care benefits or any other benefits provided under the group policy in addition to its hospital, surgical or major medical benefits unless the insurer previously included such benefits and the insured requests such benefits;

(iv) An employee or member who wishes continuation of coverage shall request the continuation in writing within the thirty-one (31) day period following the date of termination of coverage;

(v) An employee or member electing continuation shall pay to the insurer, third party administrator, group policyholder or the employer, as designated by the employer, on a monthly basis in advance, the amount of contribution required by the policyholder or employer, but not more than one hundred two percent (102%) of the group rate for the insurance being continued under the group policy on the due date of each payment. The employer's designation with regard to whom the electing employee or member shall pay his contribution shall be made in writing prior to the date the first contribution by the employee or member is due. The employee's or member's written election of continuation, together with the first contribution required to establish contributions on a monthly basis in advance, shall be given to the insurer, third party administrator, policyholder or employer within thirty-one (31) days of the date the employee's or member's insurance would otherwise terminate;

(vi) Continuation of insurance under the group policy for any person terminates when the person fails to satisfy paragraph (ii) of this subsection or, if earlier, at the first to occur of the following:

(A) The date twelve (12) months after the date the employee's or member's insurance under the policy would otherwise have terminated because of termination of employment or membership;

(B) If the employee or member fails to make timely payment of a required contribution, the end of the period for which contributions were made;

(C) The date on which the group policy is terminated or, in the case of an employee, the date the employer terminates participation under the group policy. However, if this subparagraph applies and the coverage ceasing by reason of the termination is replaced by similar coverage under another group policy, the following apply:

(I) The employee or member may become covered under that other group policy for the balance of the period that the employee or member would have remained covered under the prior group policy in accordance with this paragraph had a termination described in this subparagraph not occurred;

(II) The minimum level of benefits to be provided by the other group policy is the applicable level of benefits of the prior group policy reduced by any benefits payable under that prior group policy;

(III) The prior group policy shall continue to provide benefits to the extent of its accrued liabilities and extensions of benefits as if the replacement had not occurred.

(vii) A notification of the continuation privilege shall be included in each certificate of coverage;

(viii) Upon termination of the continuation period, the member, surviving spouse or dependent is entitled to exercise any option which is provided in the group plan to elect a conversion policy. The member electing a conversion policy shall notify the carrier of the election and pay the required premium within thirty-one (31) days of the termination of the continued coverage under the group contract.

(b) As used in subsection (a) of this section, "non-COBRA" means any group policy or certificate of insurance on a master policy of a group policy which is not subject to continuation of rights as provided under the federal Consolidated Omnibus Budget Reconciliation Act of 1985, as amended.

ARTICLE 2 - GROUP COVERAGE REPLACEMENT ACT

26-19-201. Purpose and scope of article.

(a) The purpose of this article is to:

(i) Provide for continuance of coverage for all participants when a succeeding carrier's contract replaces a prior plan's benefits; and

(ii) Prohibit the imposition of preexisting condition limitations under certain circumstances.

(b) This article is applicable to all insurance policies and subscriber contracts issued or provided by an insurance company or a nonprofit service corporation on a group or group-type basis covering persons as employees of employers or as members of unions, associations, multiple employer trusts or organizations, or any arrangement subject to the jurisdiction of the insurance department.

26-19-202. Definitions.

(a) As used in this article:

(i) "Carrier" means an insurance company, nonprofit service corporation, trust, association or other arrangement subject to the jurisdiction of the insurance department;

(ii) "Group-type basis" means a benefit plan which meets the following conditions:

(A) Coverage is provided through insurance policies or subscriber contracts to classes of employees or members defined in terms of conditions pertaining to employment or membership or any other arrangement subject to the jurisdiction of the insurance department;

(B) The coverage is not available to the general public and can be obtained and maintained only because of the covered person's membership in connection with the particular organization or group;

(C) There are arrangements for bulk payment of premiums or subscription charges to the insurer, nonprofit service corporation, association or trust;

(D) There is sponsorship of the plan by the employer, union, association, trust or organization; and

(E) Individually underwritten and issued guaranteed renewable policies shall not be considered "group-type basis" under this paragraph even though purchased through payroll deduction.

26-19-203. Continuance of coverage where one carrier's contract replaces a plan of similar benefits of another carrier.

(a) In those instances in which one (1) carrier's contract replaces a plan of similar benefits of another carrier:

(i) The prior carrier remains liable only to the extent of its accrued liabilities and extensions of benefits. The position of the prior carrier shall be the same whether the group policy holder or other entity secures replacement coverage from a new carrier, self-insures or foregoes the provision of coverage;

(ii) The succeeding carrier is liable under the following circumstances:

(A) Each person covered under the prior carrier's plan shall be eligible for complete coverage in accordance with the succeeding carrier's plan of benefits, which shall include coverage for ninety (90) days for any complication caused as a result of a condition for which benefits were paid under the prior plan within ninety (90) days prior to termination of that plan. Copayment and deductible levels for coverage required under this subparagraph may be applied in a manner consistent with those provided by the succeeding carrier's plan;

(B) In the case of a preexisting conditions limitation included in the succeeding carrier's plan, the level of benefits applicable to preexisting conditions of persons becoming covered by the succeeding carrier's plan in accordance with this paragraph during the period of time this limitation applies under the new plan shall be the lesser of:

(I) The benefits of the new plan determined without application of the preexisting conditions limitations; or

(II) The benefits of the prior plan.

(C) In any situation where a determination of the prior carrier's benefit is required by the succeeding carrier, at the succeeding carrier's request the prior carrier shall furnish a statement of the benefits available or pertinent information, sufficient to permit verification of the benefit determination or the determination itself by the succeeding carrier. For the purposes of this section, benefits of the prior plan will be determined in accordance with all of the definitions, conditions and covered expense provisions of the prior plan rather than those of the succeeding plan. The benefit determination will be made as if coverage had not been replaced by the succeeding carrier.

26-19-204. Violations; penalty.

Any person who violates any of the provisions of this article shall be subject to the penalties provided by W.S. 26-1-107.

ARTICLE 3 - SMALL EMPLOYER HEALTH INSURANCE AVAILABILITY

26-19-301. Short title.

This act shall be known and may be cited as the "Small Employer Health Insurance Availability Act."

26-19-302. Definitions.

(a) As used in this act:

(i) "Actuarial certification" means a written statement by a member of the American Academy of Actuaries or other individual acceptable to the commissioner that a small employer carrier is in compliance with the provisions of W.S. 26-19-304, based upon the person's examination, including a review of the appropriate records and of the actuarial assumptions and methods used by the small employer carrier in establishing premium rates for applicable health benefit plans;

(ii) "Base premium rate" means, for each class of business as to a rating period, the lowest premium rate charged or that could have been charged under a rating system for that class of business, by the small employer carrier to small employers with similar case characteristics for health benefit plans with the same or similar coverage;

(iii) "Basic health benefit plan" means a low cost health benefit plan developed pursuant to W.S. 26-19-308;

(iv) "Board" means the board of directors of the program;

(v) "Carrier" means any person who provides any health benefit plan in this state subject to state insurance regulation and includes, but is not limited to, an insurance company, a fraternal benefit society, a prepaid hospital or medical care plan, a health maintenance organization and a multiple employer welfare arrangement. For purposes of this act, companies that are affiliated companies or that are eligible to file a consolidated tax return shall be treated as one (1) carrier except that any insurance company, health service corporation, hospital service corporation or medical service corporation that is an affiliate of a health maintenance organization located in this state, or any health maintenance organization located in this state which is an affiliate of an insurance company, health service corporation, hospital service corporation or medical service corporation may treat the health maintenance organization as a separate carrier and each health maintenance organization that operates only one (1) health maintenance organization in an established geographic service area of this state may be considered a separate carrier;

(vi) "Case characteristics" means demographic or other objective characteristics of a small employer, as determined by a small employer carrier, that are considered by the small employer carrier in the determination of premium rates for the small employer, provided, however, that claim experience, health status and duration of coverage since issue are not case characteristics for the purposes of this act;

(vii) "Class of business" means all of a distinct grouping of small employers as shown on the records of the small employer carrier, and provided:

(A) A distinct grouping may only be established by the small employer carrier on the basis that the applicable health benefit plans:

(I) Are marketed and sold through individuals and organizations which are not participating in the marketing or sale of other distinct groupings of small employers for such small employer carrier;

(II) Have been acquired from another small employer carrier as a distinct grouping of plans; or

(III) Are provided through an association with membership of not less than two (2) small employers.

(B) A small employer carrier may establish no more than two (2) additional groupings under each subdivision (I) through (III) of subparagraph (A) of this paragraph on the basis of underwriting criteria which are expected to produce substantial variation in the health care costs;

(C) The commissioner may approve the establishment of additional distinct groupings upon application to the commissioner and a finding by the commissioner that such action would enhance the efficiency and fairness of the small employer marketplace.

(viii) Repealed by Laws 1995, ch. 94, 3.

(ix) "Dependent" means:

(A) A spouse or unmarried child under the age of nineteen (19) years;

(B) An unmarried child who is a full-time student under the age of twenty-three (23);

(D) Any other individual defined to be a dependent in the health benefit plan covering the employee.

(x) "Eligible employee" means an employee who works on a full-time basis, with a normal work week of thirty (30) or more hours and has met any applicable waiting period requirements. The term includes a sole proprietor, a partner of a partnership or an independent contractor, if the sole proprietor, partner or independent contractor is included as an employee under a health benefit plan of a small employer, but does not include employees who work on a part-time, temporary, seasonal or substitute basis;

(xi) "Established geographic service area" means a geographical area approved by the commissioner in conjunction with the carrier's certificate of authority to transact insurance in this state, within which the carrier is authorized to provide coverage;

(xii) "Health benefit plan" means any hospital or medical policy or certificate, major medical expense insurance, hospital or medical service plan contract or health maintenance organization subscriber contract. "Health benefit plan" does not include accident-only, credit, dental, vision, Medicare supplement, long-term care or disability income insurance, coverage issued as a supplement to liability insurance, worker's compensation or similar insurance or automobile medical-payment insurance, nor does it include policies or certificates of specified disease, hospital confinement indemnity or limited benefit health insurance if the carrier offering the policies or certificates certifies to the commissioner that policies or certificates described in this paragraph are being offered and marketed as supplemental health insurance and not as a substitute for hospital or medical expense insurance or major medical expense insurance;

(xiii) Repealed by Laws 1993, ch. 83, 2.

(xiv) "Index rate" means, for each class of business as to a rating period for small employers with similar case characteristics, the arithmetic average of the applicable base premium rate and the corresponding highest premium rate;

(xv) "Late enrollee" means an eligible employee or dependent who requests enrollment in a health benefit plan of a small employer following the initial enrollment period provided under the terms of the health benefit plan, provided that the initial enrollment period shall be a period of at least thirty (30) days. An eligible employee or dependent shall not be considered a late enrollee if:

(A) The individual:

(I) Was covered under a public or private health insurance or other health benefit arrangement at the time the individual was eligible to enroll;

(II) Has lost coverage under a public or private health insurance or other health benefit arrangement as a result of termination of employment or eligibility, the termination of the other plan's coverage, death of a spouse, divorce, legal separation or termination of employer contribution; and

(III) Requests enrollment within thirty (30) days after termination of coverage provided under a public or private health insurance or other health benefit arrangement.

(B) The individual is employed by an employer which offers multiple health benefit plans and the individual elects a different plan during an open enrollment period; or

(C) A court has ordered coverage be provided for a spouse or minor child under a covered employee's health benefit plan and request for enrollment is made within thirty (30) days after issuance of the court order.

(xvi) "New business premium rate" means, for each class of business as to a rating period, the lowest premium rate charged or offered, or which could have been charged or offered, by the small employer carrier to small employers with similar case characteristics for newly issued health benefit plans with the same or similar coverage;

(xvii) "Participating carrier" means all small employer carriers issuing health benefit plans in this state. "Participating carrier" shall also include any carrier that maintains an existing health benefit plan covering eligible employees of one (1) or more small employers;

(xviii) "Plan of operation" means the plan of operation of the program, including articles, bylaws and operating rules adopted by the board pursuant to W.S. 26-19-307;

(xix) "Preexisting condition provision" means a policy provision that excludes coverage for charges or expenses incurred during a specified period following the insured's effective date of coverage, as to a condition which, during a specified period immediately preceding the effective date of coverage, medical advice, diagnosis, care or treatment was recommended or received;

(xx) "Program" means the Wyoming small employer health reinsurance program created by W.S. 26-19-307;

(xxi) "Rating period" means the calendar period for which premium rates established by a small employer carrier are assumed to be in effect, as determined by the small employer carrier;

(xxii) "Small employer" means any person, firm, corporation, partnership or association who is actively engaged in business who, on at least fifty percent (50%) of its working days during the preceding calendar quarter, employed at least two (2) but no more than fifty (50) eligible employees, the majority of whom were employed within this state or were residents of Wyoming. In determining the number of eligible employees, companies which are affiliated companies, or which are eligible to file a combined tax return for purposes of any state taxation, shall be considered one (1) employer;

(xxiii) "Small employer carrier" means any carrier that offers health benefit plans covering eligible employees of one (1) or more small employers;

(xxiv) "Standard health benefit plan" means a health benefit plan developed pursuant to W.S. 26-19-308;

(xxv) "Taft-Hartley trust" means a trust formed pursuant to a collective bargaining agreement under the federal Labor Management Relations Act of 1947;

(xxvi) "Affiliation period" means a period which, under the terms of the health insurance coverage offered by a health maintenance organization, must expire before the health insurance coverage becomes effective. The health maintenance organization is not required to provide health care services or benefits during an affiliation period and no premiums shall be charged to the participant or beneficiary for any coverage during the period;

(xxvii) "Provider network" means health insurance coverage offered by a health insurance issuer under which the financing and delivery of medical care, including items and services paid for as medical care, is provided in whole or in part, through a defined set of providers under contract with the issuer;

(xxviii) "This act" means W.S. 26-19-301 through 26-19-310.

26-19-303. Applicability and scope.

(a) This act shall apply to any health benefit plan which provides coverage to two (2) or more employees of a small employer in this state if:

(i) Any portion of the premium or benefits is paid by a small employer or if an eligible employee or dependent is reimbursed, whether through wage adjustments or otherwise, by a small employer for any portion of the premium; or

(ii) The health benefit plan is treated by the employer or any of the eligible employees or dependents as part of a plan or program for the purposes of section 162, section 125 or section 106 existing as of the effective date of this act or similar sections subsequently enacted of the United States Internal Revenue Code.

(b) Notwithstanding subsection (a) of this section, W.S. 26-19-305(a) and (c) and 26-19-304(a) shall not apply to individual health benefit policies sold to small employers which are subject to approval for policy form by the commissioner.

(c) A Taft-Hartley trust, or a carrier with the written authorization of a Taft-Hartley trust may make a written request to the commissioner for a waiver from the application of any of the provisions of W.S. 26-19-304(a) with respect to a health benefit plan provided to the trust. The commissioner may grant the waiver if he finds that application of W.S. 26-19-304(a) with respect to the trust would have a substantial adverse effect on the participants and beneficiaries of the trust, and would require significant modifications to one (1) or more collectively bargained arrangement for which the trust is established or maintained. A waiver granted under this subsection shall not apply to an individual if the person participates in the trust as an associate member of an employee organization.

26-19-304. Restrictions relating to premium rates.

(a) Premium rates for health benefit plans subject to this act shall be subject to the following provisions:

(i) The index rate for a rating period for any class of business shall not exceed the index rate for any other class of business by more than twenty percent (20%);

(ii) For a class of business, the premium rates charged during a rating period to small employers with similar case characteristics for the same or similar coverage, or the rates which could be charged to employers under the rating system for that class of business shall not vary from the index rate by more than thirty-five percent (35%) of the index rate;

(iii) The percentage increase in the premium rate charged to a small employer for a new rating period shall not exceed the sum of the following:

(A) The percentage change in the new business premium rate measured from the first day of the prior rating period to the first day of the new rating period. In the case of a health benefit plan into which a small employer carrier is no longer enrolling new small employers, the carrier shall use the percentage change in the base premium rate, provided that the change does not exceed, on a percentage basis, the change in the new business premium rate for the most similar health benefit plan into which the carrier is actively enrolling new small employers;

(B) Any adjustment, not to exceed fifteen percent (15%) annually and adjusted pro rata for rating periods of less than one (1) year, due to the claim experience, health status or duration of coverage of the employees or dependents of the small employer as determined from the small employer carrier's rate manual for the class of business; and

(C) Any adjustment due to change in coverage or change in the case characteristics of the small employer as determined from the small employer carrier's rate manual for the class of business.

(iv) Adjustments in rates for claims experience, health status and duration from issue shall not be charged to individual employees or dependents. Any such adjustment shall be applied uniformly to the rates charged for all employees and dependents of the small employer;

(v) Any adjustment in rates charged by a small employer carrier caused by reinsurance is subject to the rating limitations set forth in this section;

(vi) Premium rates for health benefit plans shall comply with the requirements of this section notwithstanding any assessments paid or payable by small employer carriers under this act;

(vii) In any case where a small employer carrier utilizes industry as a case characteristic in establishing premium rates, the rate factor associated with any industry classification shall not vary from the arithmetic average of the rate factors associated with all industry classifications by greater than fifteen percent (15%) of such coverage;

(viii) In the case of health benefit plans issued prior to the effective date of this act, a premium rate for a rating period may exceed the ranges set forth in paragraphs (i) and (ii) of subsection (a) of this section for a period of three (3) years following the effective date of this act. In such case, the percentage increase in the premium rate charged to a small employer in such a class of business for a new rating period may not exceed the sum of the following:

(B) Any adjustment due to change in coverage or change in the case characteristics of the small employer as determined from the carrier's rate manual for the class of business.

(ix) Small employer carriers shall apply rating factors, including case characteristics, consistently with respect to all small employers in a class of business;

(x) For the purposes of this subsection, a health benefit plan that utilizes a provider network shall not be considered similar coverage to a health benefit plan that does not utilize such a network, provided that utilization of the network results in substantial differences in claims costs;

(xi) The small employer carrier shall not use case characteristics, other than age, gender, industry, geographic area, family composition and group size without prior approval of the commissioner;

(xii) The commissioner shall adopt regulations to implement the provisions of this section and to assure that rating practices used by small employer carriers are consistent with the purposes of this act, including regulations that:

(A) Assure that differences in rates charged for health benefit plans by small employer carriers are reasonable and reflect objective differences in plan design;

(B) Prescribe the manner in which case characteristics may be used by small employer carriers.

(b) A small employer carrier shall not transfer a small employer involuntarily into or out of a class of business. A small employer carrier shall not offer to transfer a small employer into or out of a class of business unless the offer is made to transfer all small employers in the class of business without regard to case characteristics, claim experience, health status or duration of coverage since issue.

(c) The commissioner may suspend for a specified period the application of paragraph (a)(i) of this section as to the premium rates applicable to one (1) or more small employers included within a class of business of a small employer carrier for one (1) or more rating periods upon a filing by the small employer carrier and a finding by the commissioner either that the suspension is reasonable in light of financial condition of the small employer carrier or that the suspension would enhance the efficiency and fairness of the marketplace for small employer health insurance.

(d) In connection with the offering for sale of any health benefit plan to a small employer, the small employer carrier shall make a reasonable disclosure, as part of its solicitation and sales materials, of the following:

(i) The extent to which premium rates for a specified small employer are established or adjusted in part based upon the actual or expected variation in claims costs or actual or expected variation in health condition of the employees and dependents of the small employer;

(ii) The provisions concerning the small employer carrier's right to change premium rates and the factors other than claim experience which affect changes in premium rates;

(iii) The provisions relating to renewability of policies and contracts; and

(iv) The provisions relating to any preexisting condition provision.

(e) Each small employer carrier shall:

(i) Maintain at its principal place of business a complete and detailed description of its rating practices and renewal underwriting practices, including information and documentation that demonstrate that its rating methods and practices are based upon commonly accepted actuarial assumptions and are in accordance with sound actuarial principles;

(ii) File with the commissioner annually on or before March 15 an actuarial certification certifying that the carrier is in compliance with this act and that the rating methods of the small employer carrier are actuarially sound. A copy of the certification shall be retained by the small employer carrier at its principal place of business;

(iii) Make the information and documentation described in paragraph (i) of this subsection available to the commissioner upon request. Except in cases of violations of this act, the information shall be considered proprietary and trade secret information and shall not be subject to disclosure by the commissioner to persons outside of the department except as agreed to by the small employer carrier or as ordered by a court of competent jurisdiction.

26-19-305. Renewability of coverage.

(a) A health benefit plan subject to this act shall be renewable with respect to all eligible employees or dependents at the option of the employer except in the following cases:

(i) Nonpayment of the required premiums;

(ii) Fraud or misrepresentation of the employer or, with respect to coverage of individual insureds, the insureds or their representatives;

(iii) Noncompliance with the carrier's minimum participation requirements;

(iv) Noncompliance with the carrier's employer contribution requirements;

(v) Repeated misuse of a provider network provision;

(vi) The carrier elects not to renew all of its health benefit plans issued to small employers in this state. In such a case, the carrier shall:

(A) Provide advanced notice of its decision under this paragraph to the commissioner in each state in which it is licensed; and

(B) Provide notice of the decision not to renew coverage to all affected health benefit plans and to the commissioner in each state in which an affected insured individual is known to reside at least one hundred eighty (180) days prior to the nonrenewal of any health benefit plans by the carrier. Notice to the commissioner under this subparagraph shall be provided at least three (3) working days prior to the notice to the affected health plans.

(vii) The commissioner finds that the continuation of the coverage would:

(A) Not be in the best interests of the policyholders or certificate holders; or

(B) Impair the carrier's ability to meet its contractual obligations.

(b) If the commissioner finds that the carrier may elect not to renew coverage under paragraph (vii) of subsection (a) of this section he shall assist affected small employers in finding replacement coverage.

(c) A carrier that elects not to renew a health benefit plan under paragraph (vi) of subsection (a) of this section shall be prohibited from writing new business in the small employer market for a period of five (5) years from the date of notice to the commissioner.

(d) In the case of a health maintenance organization doing business in the small employer market in one (1) established geographic service area of the state, the provisions set forth in this section shall apply to the health maintenance organization's operations in that service area.

26-19-306. Availability of coverage.

(a) Within one hundred eighty (180) days after the commissioner's approval of the basic health benefit plan and the standard health benefit plan developed pursuant to W.S. 26-19-308, but in no case prior to March 31, 1993, every small employer carrier shall, as a condition of transacting business in this state with small employers, actively offer to small employers all health benefit plans which it actively markets to small employers in this state, including at least two (2) health benefit plans. One (1) plan to be offered by each small employer carrier shall be a basic health benefit plan and one (1) plan shall be a standard health benefit plan. Except as provided in this section, all small employer carriers shall issue any health benefit plan to any eligible small employer that applies for the plan and agrees to make the required premium payments and to satisfy the other reasonable provisions of the plan. Carriers or multiple employer welfare associations whose bylaws or charters do not permit them to issue coverage on a marketwide basis shall only be required to guarantee issue to those small employers which meet the requirements of the bylaws or charters. Charter or bylaw provisions which prohibit issuance to specific populations based on health status or health risk shall not be considered as exceptions to the requirements of this subsection.

(b) A small employer carrier shall file with the commissioner, in a format and manner prescribed by the commissioner, the basic health benefit plan and the standard health benefit plan to be used by the carrier. A plan filed pursuant to this section may be used by a small employer carrier beginning forty-five (45) days after it is filed unless the commissioner disapproves its use. The commissioner at any time may, after providing notice and an opportunity for a hearing to the small employer carrier, disapprove the continued use by a small employer carrier of a basic or standard health benefit plan on the grounds that the plan does not meet the requirements of this section.

(i) Preexisting condition provisions shall not exclude coverage for a period beyond twelve (12) months following the individual's effective date of coverage and shall only relate to conditions for which medical advice, diagnosis, care or treatment was recommended or received during the six (6) months immediately preceding the effective date of coverage. Pregnancy shall not be treated as a preexisting condition. Genetic information shall not be treated as a preexisting condition in the absence of a diagnosis of a condition related to such information;

(ii) In determining whether a preexisting condition provision applies to an eligible employee or dependent, all health benefit plans shall credit the time the person was previously covered by public or private health insurance or other health benefit arrangement if the previous coverage was continuous to a date not more than ninety (90) days prior to the effective date of the new coverage, exclusive of any applicable waiting period under such plan;

(iii) Late enrollees may be excluded from coverage for the greater of eighteen (18) months or an eighteen (18) month preexisting condition exclusion, provided that if both a period of exclusion from coverage and a preexisting condition exclusion are applicable to a late enrollee, the combined period shall not exceed eighteen (18) months;

(iv) Any requirement used by a small employer carrier in determining whether to provide coverage to a small employer group, including requirements for minimum participation of eligible employees and minimum employer contributions, shall be applied uniformly among all small employer groups with the same number of eligible employees applying for coverage or receiving coverage from the small employer carrier. A small employer carrier may vary application of minimum participation requirements and minimum employer contribution requirements only by the size of the small employer group;

(v) In applying minimum participation requirements with respect to a small employer, a small employer carrier shall not consider employees or dependents who are otherwise covered by a public or an employment based health benefit plan in determining whether the applicable percentage of participation is met;

(vi) If a small employer carrier offers coverage to a small employer, it shall offer coverage to all of the small employer's eligible employees and their dependents. A small employer carrier shall not offer coverage to only certain persons in a group or to only part of a group, except in the case of late enrollees as provided in paragraph (iii) of this subsection. Except as permitted under paragraphs (i) and (iii) of this subsection, a small employer carrier shall not modify a health benefit plan with respect to a small employer or any eligible employee or dependent, through riders, endorsements or otherwise, to restrict or exclude coverage or benefits for specified diseases, medical conditions or services otherwise covered by the plan;

(vii) In the case of a group health plan that offers medical care through health insurance coverage offered by a health maintenance organization, the plan may provide for an affiliation period with respect to coverage through the health maintenance organization only if:

(A) No preexisting condition exclusion is imposed with respect to such coverage;

(B) The affiliation period is applied uniformly without regard to any health status related factors; and

(d) No small employer carrier shall be required to offer coverage or accept applications pursuant to subsection (a) of this section in the case of the following:

(i) To a small employer, where the small employer is not physically located in the small employer carrier's established geographic service area;

(ii) To an employer whose employees do not work or reside within the small employer carrier's established geographic service area; or

(iii) Within an area where the small employer carrier reasonably anticipates, and demonstrates to the satisfaction of the commissioner, that it will not have the capacity within its established geographic service area to deliver service adequately to the members of such groups because of its obligations to existing group contract holders and enrollees.

(e) A small employer carrier that cannot offer coverage pursuant to paragraph (d)(iii) of this section shall not offer coverage in the applicable area to new cases of employer groups with more than fifty (50) eligible employees or small employer groups until the later of one hundred eighty (180) days following each such refusal or the date on which the carrier notifies the commissioner that it has regained capacity to deliver services to small employer groups.

(f) If any carrier has insured a disproportionate number of small employer groups with employees requiring reinsurance, the carrier may petition the commissioner to temporarily suspend the requirement to accept every small employer applying for coverage. The suspension may be granted only if the commissioner finds:

(i) The carrier is reasonably reinsuring lives at a rate of at least one hundred thirty percent (130%) of the statewide average for reinsurance; and

(ii) The rate of reinsurance is having a significant disproportional adverse effect on the carrier that is impairing its ability to offer policies at competitive rates in the small group market.

(g) A small employer carrier shall not be required to offer coverage or accept applications pursuant to subsection (a) of this section for so long as the commissioner finds that the acceptance of an application or applications would place the small employer carrier in a financially impaired condition.

(h) The requirements of subsections (a) and (b) of this section shall not apply to any carrier which maintains existing health benefit plans covering eligible employees of one (1) or more small employers but is no longer enrolling new small employers.

(j) In addition to the prohibition on the use of genetic testing information provided in paragraph (c)(i) of this section, all health benefit plans covering small employers shall not, based on the genetic testing information of an individual or a family member of an individual:

(i) Establish rules of eligibility to enroll in the plan;

(ii) Deny eligibility;

(iii) Adjust premium rates;

(iv) Adjust contribution rates;

(v) Request or require predictive genetic testing information concerning an individual or a family member of the individual, except the health benefit plan may only request, but not require, predictive genetic testing information if needed for diagnosis, treatment or payment. As part of a request under this paragraph, the plan or issuer shall provide a description of the procedures in place to safeguard confidentiality of the information.

26-19-307. Small employer carrier reinsurance program.

(a) There is hereby created a nonprofit entity to be known as the "Wyoming small employer health reinsurance program."

(b) Within sixty (60) days of the effective date of this act, each small employer carrier shall make a filing with the commissioner containing the carrier's net health insurance premium derived from health benefit plans delivered to small employers in this state in the previous calendar year.

(c) Within sixty (60) days of the effective date of this act the commissioner shall give notice to all participating carriers of the time and place for the initial organizational meeting, which shall take place within one hundred twenty (120) days of the effective date. The participating carriers shall select the initial board which shall be subject to approval by the commissioner. The board shall be selected by a weighted vote based upon net health insurance premium derived from health benefit plans written in this state in the previous calendar year in the small employer market. The board shall consist of at least five (5) and not more than nine (9) representatives of participating carriers who shall serve three (3) year staggered terms. To the extent possible, the board shall include representation from carriers whose principal health insurance business is in the small employer market, health maintenance organizations and nonprofit health, hospital or medical service corporations. No one (1) carrier including its affiliates, shall be represented by a majority of the board. Members of the board shall be reimbursed from the assets of the program for expenses incurred by them as members of the board but shall not otherwise be compensated by the program for their services. The commissioner or the commissioner's designee shall be an ex officio voting member of the board. In approving the selection of the board, the commissioner shall assure that all participating carriers are fairly represented.

(d) If the initial board is not selected at the organizational meeting, the commissioner shall appoint the initial board within fifteen (15) days of the organizational meeting.

(e) Within one hundred eighty (180) days after the selection or appointment of the initial board, the board shall submit to the commissioner a plan of operation and thereafter any amendments necessary or suitable, to assure the fair, reasonable and equitable administration of the program. The commissioner may, after notice and hearing, approve the plan of operation provided the commissioner determines it is suitable to assure the fair, reasonable and equitable administration of the program, and provides for the sharing of program gains or losses on an equitable and proportionate basis in accordance with the provisions of this section. The plan of operation shall become effective upon approval in writing by the commissioner consistent with the date on which the coverage under this section shall be made available. Any plan of operation or amendments thereto, submitted to the commissioner by the board pursuant to this subsection shall be deemed approved by the commissioner if not expressly disapproved in writing by the commissioner within ninety (90) days of its receipt by the commissioner.

(f) If the board fails to submit a suitable plan of operation within one hundred eighty (180) days after its selection or appointment, the commissioner shall, after notice and hearing, adopt and promulgate a temporary plan of operation. The commissioner shall amend or rescind any plan adopted by him under this subsection at the time a plan of operation is submitted by the board and approved by the commissioner.

(g) The plan of operation shall:

(i) Establish procedures for handling and accounting of program assets and monies and for an annual fiscal reporting to the commissioner;

(ii) Establish terms of office and procedures for filling vacancies on the board, subject to the approval of the commissioner;

(iii) Establish procedures for selecting an administering carrier and setting forth the powers and duties of the administering carrier;

(iv) Establish procedures for reinsuring risks in accordance with the provisions of this act;

(v) Establish procedures for collecting assessments from participating carriers to provide for claims reinsured by the program and for administrative expenses incurred or estimated to be incurred during the period for which the assessment is made;

(vi) Provide for any additional matters at the discretion of the board.

(h) The program shall have the general powers and authority granted under the laws of this state to insurance companies and health maintenance organizations licensed to transact business, except the power to issue health benefit plans directly to either groups or individuals. The program shall also have the specific authority to:

(i) Enter into contracts necessary or proper to carry out the provisions and purposes of this act, including the authority, with the approval of the commissioner, to enter into contracts with similar programs of other states for the joint performance of common functions or with persons or other organizations for the performance of administrative functions;

(ii) Sue or be sued, including taking any legal actions necessary or proper for recovering any assessments and penalties for, on behalf of, or against the program or any participating carriers;

(iii) Take any legal action necessary to avoid the payment of improper claims against the program;

(iv) Define the array of health coverage products for which reinsurance will be provided, and to issue reinsurance policies, in accordance with the requirements of this act;

(v) Establish rules, conditions and procedures pertaining to the reinsurance of participating carrier's risks by the program;

(vi) Establish actuarial functions as appropriate for the operation of the program;

(vii) Assess participating carriers in accordance with the provisions of subsection (g) of this section, and to make advance interim assessments as may be reasonable and necessary for organizational and interim operating expenses. Any interim assessments shall be credited as offsets against any regular assessments due following the close of the fiscal year;

(viii) Appoint appropriate legal, actuarial and other committees as necessary to provide technical assistance in the operation of the program, policy and other contract design, and any other function within the authority of the program;

(ix) Borrow money to effect the purposes of the program. Any notes or other indebtedness of the program not in default shall be legal investments for carriers and may be carried as admitted assets;

(x) Adjust the five thousand dollar ($5,000.00) deductible reinsurance requirement contained in paragraph (j)(v) of this section to reflect the effects of inflation. The board annually shall adjust the deductible reinsurance requirement to reflect increases in costs and utilization within the standard market for health benefit plans within the state. The adjustment shall not be less than the annual change in the medical component of the "Consumer Price Index for all Urban Consumers" of the department of labor, bureau of labor statistics, unless the board proposes and the commissioner approves a lower adjustment factor. Also, with the approval of the commissioner the board may increase or decrease the amount set forth in paragraph (j)(v) of this section and paragraphs (k)(i) and (ii) of this section if it is necessary to effectuate the purposes of this act and does not require participating carriers to retain an unreasonable level of risk.

(j) A participating carrier may reinsure with the program as provided for in this subsection:

(i) With respect to a basic health benefit plan or a standard health benefit plan, the program shall reinsure the level of coverage provided and, with respect to other plans, the program shall reinsure up to the level of coverage provided in a basic or standard health benefit plan;

(ii) Except in the case of a late enrollee, a participating carrier may reinsure an eligible employee or dependent within sixty (60) days of the commencement of the coverage of the small employer. A newly eligible employee or dependent may be reinsured within sixty (60) days of the commencement of his coverage;

(iii) A participating carrier may reinsure an entire employer group within sixty (60) days of the commencement of the group's coverage under the plan. The carrier may choose to reinsure newly eligible employees and dependents of a reinsured group pursuant to paragraph (ii) of this subsection;

(iv) Small employer group business in force before the program's plan of operation becomes effective shall not be reinsured by the program until July 1, 1995 and then only if the board determines that sufficient funding sources are available. This restriction shall not apply to newly eligible employees and dependents. The board shall adopt rules and regulations providing conditions under which reinsurance will be issued on employers, employees, or dependents who were subject to riders, endorsements or other contract provisions which restricted or excluded coverage or benefits for specified diseases, medical conditions or services otherwise covered by the plans if the provisions were in force prior to the effective date of the program's plan of operation. The reinsurance may be limited to coverage for the specified diseases, medical conditions or services that had previously been restricted or excluded by the riders, endorsements or other provisions;

(v) The program shall not reimburse a participating carrier with respect to the claims of a reinsured employee or dependent until the carrier has paid a deductible of five thousand dollars ($5,000.00) in a calendar year for benefits covered by the program. A participating carrier's liability under this paragraph shall not exceed a maximum limit of five thousand dollars ($5,000.00), in any one (1) calendar year with respect to any one (1) person reinsured. The amounts stated in this paragraph shall be increased in accordance with inflation adjustments made by the board under paragraph (h)(x) of this section;

(vi) A participating carrier may terminate reinsurance for all of the reinsured employees or dependents of a small employer on any plan anniversary;

(vii) Premium rates charged for reinsurance by the program to a health maintenance organization which is federally qualified under 42 U.S.C. 300 e(c)(2)(A) or a similar section subsequently enacted, and as such is subject to requirements that limit the amount of risk that may be ceded to the program that is more restrictive than paragraph (iii) of this subsection, shall be reduced to reflect that portion of the risk above the amount set forth in paragraph (iii) of this subsection that shall not be ceded to the program, if any;

(viii) The board may consider adjustments to the premium rates charged for reinsurance by the program for carriers using effective cost containment, including high-cost case management, as defined by the board;

(ix) A participating carrier shall apply its case management and claims handling techniques, including but not limited to utilization review, individual case management, preferred provider provisions, other managed care provisions or methods of operation, consistently with both reinsured and nonreinsured business.

(k) The board, as part of the plan of operation, shall establish a methodology for determining premium rates to be charged by the program for reinsuring small employers and individuals pursuant to this section. The methodology shall include a system for classification of small employers that reflects the types of case characteristics commonly used by small employer carriers in the state. The methodology shall provide for the development of base reinsurance premium rates, which shall be multiplied by the factors set forth in paragraphs (i) and (ii) of this subsection to determine the premium rates for the program. The base reinsurance premium rates and number and type of insured groupings shall be established by the board, subject to the approval of the commissioner, and shall be set at levels which reasonably approximate gross premiums charged to small employers by small employer carriers. The board periodically shall review the methodology established under this subsection, including the system of classification and any rating factors, to assure that it reasonably reflects the claims experience of the program. The board may propose changes to the methodology which shall be subject to the approval of the commissioner. The board shall take steps to expand the usage of the reinsurance program and to reduce the impacts of high risk individuals on any particular group. Premiums for the program shall be as follows:

(i) An entire small employer group may be reinsured for a rate that is between one and one-tenth (1.1) and one and one-half (1.5) times the base reinsurance premium rate for the group established pursuant to this subsection;

(ii) An eligible employee or dependent may be reinsured for a rate that is between one and one-half (1.5) and five (5) times the base reinsurance premium rate for the individual established pursuant to this subsection;

(iii) The premiums shall be kept as close as practical to the lower limits provided by this subsection except to the extent needed to keep the assessments needed within the forty percent (40%) of premium tax limit pursuant to W.S. 26-19-312(b).

(m) In any case where a health benefit plan for a small employer is entirely or partially reinsured with the program, the premium charged to the small employer for any rating period for the coverage issued shall be consistent with the requirements relating to premium rates set forth in W.S. 26-19-304(a).

(n) Assessments and other fees required by the program shall be made in accordance with this subsection:

(i) Repealed By Laws 2006, Chapter 120, 3.

(ii) Repealed By Laws 2006, Chapter 120, 3.

(iii) Repealed By Laws 2006, Chapter 120, 3.

(iv) Repealed By Laws 2006, Chapter 120, 3.

(v) Provisions shall be made in the plan of operation for the imposition of an interest penalty for late payment of assessments;

(vi) A participating carrier may seek from the commissioner a deferment in whole or in part, from any assessment issued by the board. The commissioner may defer, in whole or in part, the assessment of a participating carrier if, in the opinion of the commissioner, the payment of the assessment would place the participating carrier in a financially impaired condition. In the event an assessment against a participating carrier is deferred in whole or in part, the amount by which the assessment is deferred may be assessed against the other participating carriers in a manner consistent with the basis for the assessment set forth in this section. The participating carrier receiving a deferment shall remain liable to the program for the amount deferred.

(o) Neither the participation in the program, the establishment of procedures, nor any other joint or collective action required by this act shall be the basis of any legal action, criminal or civil liability, or penalty against the program or any participating carriers either jointly or separately.

(p) The program shall be exempt from any and all taxes.

26-19-308. Health benefit plan committee.

(a) The commissioner shall appoint a health benefit plan committee. The committee shall be composed of seven (7) members, which shall include:

(i) The commissioner;

(ii) Three (3) representatives of participating carriers; and

(iii) One (1) representative each of a small employer, an employee of a small employer and a health care provider.

(b) The committee shall recommend the form and level of coverages to be made available by small employer carriers pursuant to W.S. 26-19-306.

(c) The committee shall recommend benefit levels, cost sharing factors, exclusions and limitations for the basic health benefit plan and the standard health benefit plan. One (1) basic health benefit plan and one (1) standard health care plan shall contain benefit and cost sharing levels that are consistent with the basic method of operation and the benefit plans of health maintenance organizations, including any restrictions imposed by federal law:

(i) The plans recommended by the committee may include cost containment features such as, but not limited to:

(A) Utilization review of health care services, including review of medical necessity of hospital and physician services;

(B) Case management benefit alternatives;

(D) Other managed care provisions.

(ii) The committee shall submit the plans to the commissioner for approval within one hundred eighty (180) days after the appointment of the committee pursuant to this section. If the commissioner disapproves of the plans in whole or in part he shall submit alternative interim plans to the committee for its approval.

(d) Members of the committee shall be reimbursed from the assets of the program for expenses incurred by them as members of the committee but shall not otherwise be compensated by the program for their services.

26-19-309. Periodic market evaluation.

The board shall study and report at least every three (3) years to the commissioner on the effectiveness of this act. The report shall analyze the effectiveness of this act in promoting rate stability, product availability and affordability of coverage and may contain recommendations for actions to improve the overall effectiveness, efficiency and fairness of the small group health insurance marketplace. The report also shall address whether carriers and producers are fairly and actively marketing or issuing health benefit plans to small employers in fulfillment of the purposes of this act and may contain recommendations for market conduct or other regulatory standards or action.

26-19-310. Administrative procedures.

The commissioner may issue regulations in accordance with W.S. 26-2-110 for the implementation and administration of the Small Employer Health Insurance Availability Act.

26-19-311. Small employer carrier reinsurance account created.

There is created an account in which all money received or collected to support the small employer carrier reinsurance program created pursuant to this act shall be credited and continuously appropriated for the purposes of this act. All claims, insurer reimbursements, cost of administration and other necessary expenses incurred pursuant to this act shall be paid from the account. All money in the account not immediately necessary for the purposes of this act, which amount is certified by the board to the state treasurer, shall be invested and any interest earned shall be credited to the account.

26-19-312. Small employer carrier reinsurance program assessments; premium tax credit.

(a) After each calendar year, the board shall determine the amount of assessment needed to support the small carrier reinsurance program considering all payments made, costs incurred, premiums received and other income received.

(b) All authorized insurers liable for premium tax shall be assessed as necessary to meet the requirements determined under subsection (a) of this section. The assessment shall be in proportion to the gross premium tax owed and shall be expressed as a percentage of the gross premium tax owed. The gross premium tax is the premium tax owed before any deduction for any assessments. The assessment pursuant to this subsection for any individual insurer shall not exceed forty percent (40%) of the gross premium tax owed.

(c) On or before June 1 of each year, the board shall determine each insurer's assessment for the calendar year. Any deficit incurred by the program shall be recouped by assessment apportioned as provided by this section. Notification of assessments shall be mailed by the board not later than June 1 of each year.

(d) The total amount of assessment paid by any insurer pursuant to this section plus an amount equal to five percent (5%) of that total assessment shall be allowed as a credit against any premium or retaliatory tax owed by the member under this code for the year for which the assessment is payable. If assessments including the additional credit authorized exceed the premium or retaliatory tax owed considering all assessments pursuant to this act and other acts, the credits may be carried forward to other tax years until used.

(e) If assessments exceed actual losses and administrative expenses of the program, the excess shall be paid to the state treasurer, credited to the account created by W.S. 26-19-311 and used by the administrator to offset future losses or to reduce program premiums. As used in this subsection, "future losses" includes reserves for incurred but unreported claims.

(f) The board may require initial calendar year 2006 and interim assessments as reasonably necessary for the organizational, administrative and interim operating expenses of the program and to pay claims in excess of premiums collected. Any initial or interim assessments shall be credited as offsets against any regular assessment due following the close of the calendar year.

(g) Assessments collected pursuant to the small employer carrier reinsurance program shall be paid to the state treasurer and credited to the account created by W.S. 26-19-311.

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2010 Wyoming Statutes Title 26 - Insurance Code Chapter 19 - Group And Blanket Disability Insurance

2010 Wyoming Statutes
Title 26 - Insurance Code
Chapter 19 - Group And Blanket Disability Insurance