| (a) General rules.
(1) Medicare supplement policies and certificates must
include a renewal or continuation provision. The language or specifications
of the renewal or continuation provision must be consistent with the
type of contract issued. The provision must be appropriately captioned,
appear on the first page of the policy, and include any reservation
by the issuer of the right to change premiums and any automatic renewal
premium increases based on the age of the policyholder.
(2) Except for riders or endorsements by which the
issuer effectuates a request made in writing by the policyholder,
or by which the issuer exercises a specifically reserved right under
a Medicare supplement policy, or by which the issuer is required to
reduce or eliminate benefits to avoid duplication of Medicare benefits,
all riders or endorsements added to a Medicare supplement policy after
the date of issue or at reinstatement or renewal that reduce or eliminate
benefits or coverage in the policy must require signed acceptance
by the policyholder. After the date of issue of the policy or certificate,
any rider or endorsement that increases benefits or coverage with
concomitant increase in premium during the policy term must be agreed
to in writing and signed by the policyholder unless the benefits are
required by the minimum standards for Medicare supplement insurance
policies, or unless the increased benefits or coverage is required
by law. Where a separate additional premium is charged for benefits
provided in connection with riders or endorsements, the additional
premium charge must be set forth in the policy.
(3) Medicare supplement policies may not provide for
the payment of benefits based on standards described as "usual and
customary," "reasonable and customary," or similar words and phrases.
(4) If a Medicare supplement policy or certificate
contains any limitations with respect to preexisting conditions:
(A) the limitations must appear as a separate paragraph
of the policy or certificate and be labeled as "Preexisting Condition
Limitations;"
(B) the policy or certificate must define the term
"preexisting condition" and must provide an explanation of the term
in its accompanying outline of coverage; and
(C) the policy or certificate must include a provision
explaining the reduction of the preexisting condition limitation for
individuals who qualify under §3.3306(b)(1)(A) of this title
(relating to Minimum Benefit Standards), §3.3312(a)(2) of this
title (relating to Guaranteed Issue for Eligible Persons), or §3.3324(c)
and (d) of this title (relating to Open Enrollment).
(5) Medicare supplement policies and certificates must
have a notice prominently printed on the first page or attached to
the first page stating in substance that the policyholder or certificate
holder has the right to return the policy or certificate within 30
days of its delivery and to have the premium refunded if, after examination,
the insured person is not satisfied for any reason.
(6) Issuers of accident and sickness policies, certificates,
or subscriber contracts that provide hospital or medical-expense coverage
on an expense-incurred or indemnity basis, to persons eligible for
Medicare must provide to those applicants a Guide to Health Insurance
for People with Medicare (Guide) in the form developed jointly by
the National Association of Insurance Commissioners and the Centers
for Medicare and Medicaid Services of the United States Department
of Health and Human Services in no smaller than 12-point type.
(A) For purposes of this section, "form" means the
language, format, style, type size, type proportional spacing, bold
character, and line spacing.
(B) If a Guide incorporating the latest statutory changes
is not available from a government agency, companies may comply with
this provision by modifying the latest available Guide to the extent
required by applicable law.
(C) Except as provided in this section, delivery of
the Guide must be made whether or not any policies, certificates,
subscriber contracts, or evidences of coverage are advertised, solicited,
or issued as Medicare supplement policies or certificates as defined
in this regulation.
(D) Except in the case of direct response issuers,
delivery of the Guide must be made to the applicant at the time of
application, and acknowledgment of receipt of the Guide must be obtained
from the applicant by the issuer. Issuers must deliver the Guide to
the applicant for a direct response Medicare supplement policy on
request, but not later than at the time the policy is delivered.
(7) Except as otherwise provided in this section, the
terms "Medicare Supplement," "Medigap," "Medicare Wrap-Around," and
similar words or phrases may not be used unless the policy is issued
in compliance with §3.3306 of this title.
(b) Outline of coverage requirements for Medicare supplement
policies.
(1) Issuers of Medicare supplement coverage in this
state must provide an outline of coverage to all applicants, including
certificate holders under group policies, at the time application
is presented to the prospective applicant and, except for direct-response
policies, must obtain an acknowledgment of receipt of the outline
from the applicant.
(2) If a Medicare supplement policy or certificate
is issued on a basis that would require revision of the outline of
coverage delivered at the time of application, a substitute outline
of coverage properly describing the policy or certificate actually
issued must accompany the policy or certificate when it is delivered.
The outline of coverage must contain the following statement in no
less than 12-point type, immediately above the company name: "Notice:
Read this outline of coverage carefully. It is not identical to the
outline of coverage provided upon application and the coverage originally
applied for has not been issued."
(c) Form for outline of coverage. In providing outlines
of coverage to applicants under the requirements of subsection (b)(1)
of this section, insurers must use a form that complies with the requirements
of this subsection. The outline of coverage must contain each of the
following four parts in the following order: a cover page, premium
information, disclosure pages, and charts displaying the features
of each benefit plan offered by the issuer. The outline of coverage
must be in the language and format prescribed in paragraphs (1) and
(2) of this subsection in no less than 12-point type.
(1) All plans must be shown on the cover page, and
the plans that are offered by the issuer must be prominently identified.
Premium information for plans that are offered must be shown on the
cover page or immediately following the cover page and must be prominently
displayed. The premium and mode must be stated for all plans that
are offered to the prospective applicant. All possible premiums for
the prospective applicant must be illustrated.
(2) The items in subparagraphs (A) - (C) of this paragraph
must be included in the outline of coverage in addition to the items
specified in the plan-specific outline-of-coverage forms.
(A) Dollar amounts that are shown in parentheses for
each of the plan-specific charts on the following pages are for the
calendar year in which the charts were published. Issuers must, for
each plan offered, appropriately complete outline-of-coverage-chart
statements about amounts to be paid by Medicare, the plan, and the
covered person by replacing the amount in parentheses with the dollar
amount corresponding to each covered service for the applicable calendar
year benefit period.
(B) The outline of coverage must include an explanation
of any limitations and exclusions. Those limitations and exclusions
resulting from Medicare program provisions may be disclosed by reference
and need not be explained in their entirety. All limitations and exclusions
related to preexisting conditions and all other limitations and exclusions
not resulting from Medicare regulations must be fully explained in
the outline of coverage.
(C) The outline of coverage must include a statement
that the policy either does or does not contain provisions providing
for a refund or partial refund of premium on the death of an insured
or on the surrender of the policy or certificate. If the policy contains
these provisions, a description of the provisions must be included.
(D) The outline of coverage for Medicare Select policies
or certificates must include information regarding grievance procedures
that meet the requirements of §3.3325(m) of this title (relating
to Medicare Select Policies, Certificates, and Plans of Operation).
(E) The Commissioner adopts the Outline of Coverage
form, LHL 050 Rev. 06/18. This form contains a chart of benefits for
each of the standard Medicare supplement plans and required disclosures
applicable to policies sold with an effective date for coverage of
June 1, 2010, or later. Issuers must begin using form LHL 050 Rev.
06/18 no later than July 1, 2019.
Attached Graphic
(d) Notice requirements.
Cont'd... |
