GENERAL ASSEMBLY OF NORTH CAROLINA

SESSION 1991

S	3 

SENATE BILL 999
Insurance Committee Substitute Adopted 6/11/92
House Committee Substitute Favorable 6/24/92

Short Title:  Medicare Supplement Ins. Amendments.	(Public)
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Sponsors:
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Referred to:  
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May 27, 1992

A BILL TO BE ENTITLED
AN ACT TO AMEND THE MEDICARE SUPPLEMENT INSURANCE STATUTES AS REQUIRED BY FEDERAL LAW.
The General Assembly of North Carolina enacts:
Section 1.  G.S. 58-54-1(5) reads as rewritten:
"(5)	‘Policy' means a Medicare supplement policy, which is a group or individual policy of accident and health insurance under Articles 1 through 64 of this Chapter, a subscriber contract under Articles 65 and 66 of this Chapter, or an evidence of coverage under Article 67 of this Chapter, other than a policy issued pursuant to a contract under section 1876 or section 1833 of the federal Social Security Act (42) U.S.C. § 1395 et seq.), or an issued policy under a demonstration project authorized pursuant to amendments to the federal Social Security Act, that is advertised, marketed, or designed primarily as a supplement to reimbursements under Medicare for the hospital, medical, or surgical expenses of persons eligible for Medicare."
Sec. 2.  G.S. 58-54-25 reads as rewritten:
"§ 58-54-25.  Disclosure standards.
(a)	In order to provide for full and fair disclosure in the sale of policies, no policy or certificate shall be delivered in this State unless an outline of coverage is delivered to the applicant at the time application is made.
(b)	The Commissioner shall prescribe the format and content of the outline of coverage required by subsection (a) of this section.  for purposes of this section, ‘format' means style, arrangement, and overall appearance, including such items as the size, color, and prominence of type and arrangement of text and captions.  Such outline of coverage shall include:
(1)	A description of the principal benefits and coverage provided in the policy;
(2)	A statement of the exceptions, reductions, and limitations contained in the policy;
(3)	A statement of the renewal provisions, including any reservation by the insurer of a right to change premiums; and
(4)	A statement that the outline of coverage is a summary of the policy issued or applied for and that the policy should be consulted to determine governing contractual provisions.
(c)	The Commissioner may prescribe by rule a standard form and the contents of an informational brochure for persons eligible for Medicare, which is intended to improve the buyer's ability to select the most appropriate coverage and improve the buyer's understanding of Medicare.  Except in the case of direct response insurance policies, the Commissioner may require by rule that the information brochure be provided to any prospective insured eligible for Medicare concurrently with delivery of the outline of coverage.  With respect to direct response insurance policies, the Commissioner may require by rule that  the prescribed brochure be provided upon request to any prospective insured eligible for Medicare, but in no event later than the time of policy delivery.
(d)	The Commissioner may adopt rules for captions or notice requirements, determined to be in the public interest and designed to inform prospective insureds that particular insurance coverages are not Medicare supplement coverages, for all accident and health insurance policies sold to persons eligible for Medicare, other than:  Medicare supplement policies; disability income policies; basic, catastrophic, or major medical expense policies; or single premium, nonrenewable policies.
(e)	The Commissioner may further adopt rules to govern the full and fair disclosure of the information in connection with the replacement of accident and health insurance policies, subscriber contracts, or certificates by persons eligible for Medicare."
Sec. 3.   G.S. 58-54-10(e) is repealed.
Sec. 4.   G.S. 58-54-20(a) reads as rewritten:
"(a)	Every insurer providing group Medicare supplement insurance benefits to a resident of this State pursuant to G.S. 58-54-5 shall file a copy of the master policy and any certificate used in this State in accordance with the filing requirements and procedures applicable to group policies issued in this State."
Sec. 5.  This act is effective upon ratification.