| (a) Benefit standards for standardized Medicare supplement
benefit plan policies or certificates issued to 2020 newly eligible
individuals. The Medicare Access and CHIP Reauthorization Act of 2015
(MACRA) provides that no policy or certificate that provides coverage
of the Medicare Part B deductible may be advertised, solicited, delivered,
or issued for delivery in this state as a Medicare supplement policy
or certificate to individuals newly eligible for Medicare on or after
January 1, 2020. Benefit standards applicable to Medicare supplement
policies and certificates issued to individuals eligible for Medicare
before January 1, 2020, remain subject to the requirements of subsections
(b) and (c) of this section. All policies issued to a 2020 newly eligible
individual, as defined in this subchapter, must comply with the following
benefit standards:
(1) Benefit requirements. The standards and requirements
of subsections (b) and (c) of this section apply to all Medicare supplement
policies or certificates delivered or issued for delivery to 2020
newly eligible individuals, with the exception of subsections (b)(3)(C),
(c)(5)(C), (c)(5)(E), and (c)(5)(F) of this section.
(2) Eligibility to purchase. A 2020 newly eligible
individual is only eligible to purchase standardized Medicare supplement
benefit plans A, B, D, G, High Deductible G, K, L, M, and N. Standardized
Medicare supplement benefit plans C, F, and High Deductible F may
not be offered to 2020 newly eligible individuals.
(b) Benefit standards for 2010 Standardized Medicare
supplement benefit plan policies or certificates issued or issued
for delivery with an effective date for coverage on or after June
1, 2010. This section specifies the minimum standards applicable to
all Medicare supplement policies or certificates issued or issued
for delivery in this state with an effective date for coverage on
or after June 1, 2010. No insurance policy, subscriber contract, certificate,
or evidence of coverage may be advertised, solicited, or issued for
delivery in this state as a Medicare supplement policy unless the
policy, contract, certificate, or evidence of coverage meets the applicable
standards in paragraphs (1) - (3) of this subsection. No issuer may
offer or issue any 1990 Standardized Medicare supplement benefit plan
for sale on or after June 1, 2010. Benefit standards applicable to
Medicare supplement policies and certificates issued or issued for
delivery with an effective date before June 1, 2010, remain subject
to the laws and rules in effect when the policy or certificate was
delivered or issued for delivery. These are minimum standards and
do not prevent the inclusion of other provisions or benefits that
are not inconsistent with these standards.
(1) General standards. The following standards apply
to Medicare supplement policies and certificates and are in addition
to all other requirements of this subchapter, Insurance Code Chapter
1652, and any other applicable law.
(A) A Medicare supplement policy or certificate must
not exclude or limit benefits for losses incurred more than six months
from the effective date of coverage because it involved a preexisting
condition. The policy or certificate may not define a preexisting
condition more restrictively than a condition for which medical advice
was given or treatment was recommended by or received from a physician
within six months before the effective date of coverage.
(i) If a Medicare supplement policy or certificate
replaces another Medicare supplement policy or certificate, the replacing
issuer must waive any time applicable to preexisting condition waiting
periods, elimination periods, and probationary periods in the new
Medicare supplement policy or certificate to the extent the time was
spent under the original policy.
(ii) If a Medicare supplement policy or certificate
replaces another Medicare supplement policy or certificate that has
been in effect for at least six months, the replacing policy or certificate
must not provide any time period applicable to preexisting conditions,
waiting periods, elimination periods, and probationary periods for
benefits.
(iii) If a Medicare supplement policy or certificate
is issued or issued for delivery to an applicant who qualifies under
§3.3312(b) of this title (relating to Guaranteed Issue for Eligible
Persons) or §3.3324(a) of this title (relating to Open Enrollment),
the issuer must reduce the period of any preexisting condition exclusion
as required by §3.3312(a)(2) of this title and §3.3324(c)
and (d) of this title.
(B) A Medicare supplement policy or certificate may
not indemnify against losses resulting from sickness on a different
basis than losses resulting from accidents.
(C) A Medicare supplement policy or certificate must
provide that benefits designed to cover cost-sharing amounts under
Medicare will be changed automatically to coincide with any changes
in the applicable Medicare deductible, copayment, or coinsurance amounts.
Premiums may be modified to correspond with such changes.
(D) A Medicare supplement policy or certificate may
not:
(i) provide for termination of coverage of a spouse
solely because of the occurrence of an event specified for termination
of coverage of the insured, other than the nonpayment of premium;
or
(ii) be canceled or nonrenewed by the insurer solely
on the grounds of deterioration of health.
(E) Each Medicare supplement policy must be guaranteed
renewable and must comply with the provisions of clauses (i) - (vi)
of this subparagraph.
(i) The issuer may not cancel or nonrenew the policy
solely on the ground of health status of the individual.
(ii) The issuer may not cancel or nonrenew the policy
for any reason other than nonpayment of premium or material misrepresentation.
(iii) If the Medicare supplement policy is terminated
by the group policyholder and is not replaced as provided in clause
(v) of this subparagraph, the issuer must offer certificate holders
an individual Medicare supplement policy that, at the option of the
certificate holder:
(I) provides for continuation of the benefits contained
in the group policy; or
(II) provides for benefits that otherwise meet the
requirements of this subparagraph.
(iv) If an individual is a certificate holder in a
group Medicare supplement policy and the individual terminates membership
in the group, the issuer must:
(I) offer the certificate holder the conversion opportunity
described in clause (iii) of this subparagraph; or
(II) at the option of the group policyholder, offer
the certificate holder continuation of coverage under the group policy.
(v) If a group Medicare supplement policy is replaced
by another group Medicare supplement policy purchased by the same
policyholder, the issuer of the replacement policy must offer coverage
to all persons covered under the old group policy on its date of termination.
Coverage under the new policy may not result in any exclusion for
preexisting conditions that would have been covered under the group
policy being replaced.
(vi) If an individual is issued a certificate in Texas
in a group Medicare supplement policy and the individual moves out
of the state, the issuer may replace the Texas certificate with a
certificate of the same standardized benefit plan type, approved by
the new state of residence, if the issuer acts uniformly in its treatment
of certificate holders who move out of Texas.
(F) Termination of a Medicare supplement policy or
certificate must be without prejudice to any continuous loss that
commenced while the policy was in force, but the extension of benefits
beyond the period during which the policy was in force may be conditioned
on the continuous total disability of the insured, limited to the
duration of the policy benefit period, if any, or payment of the maximum
benefits. Receipt of Medicare Part D benefits must not be considered
in determining a continuous loss.
(G) A Medicare supplement policy or certificate must
comply with clauses (i) - (iv) of this subparagraph:
(i) A Medicare supplement policy or certificate must
provide that benefits and premiums under the policy or certificate
will be suspended at the request of the policyholder or certificate
holder for the period, not to exceed 24 months, in which the policyholder
or certificate holder has applied for and is determined to be entitled
to medical assistance under Title XIX of the Social Security Act,
but only if the policyholder or certificate holder notifies the issuer
of the policy or certificate within 90 days after the date the individual
becomes entitled to that assistance.
(ii) If suspension occurs and if the policyholder or
certificate holder loses entitlement to medical assistance, the policy
or certificate must be automatically reinstituted effective as of
the date of termination of entitlement if the policyholder or certificate
holder provides notice of loss of entitlement within 90 days after
the date of loss and pays the premium attributable to the period,
effective as of the date of termination of entitlement.
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