GENERAL ASSEMBLY OF NORTH CAROLINA

SESSION 1995

H	1 

HOUSE BILL 861

Short Title:  Insurance Reform Measures.	(Public)

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Sponsors: Representatives Dockham; and Gardner.

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Referred to:  Insurance.

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April 12, 1995

A BILL TO BE ENTITLED
AN ACT TO ENACT CERTAIN HEALTH INSURANCE REFORM MEASURES.
The General Assembly of North Carolina enacts:
Section 1. Article 3 of Chapter 58 of the General Statutes is amended by adding a new section to read:
"§ 58-3-185.  Excess or stop loss coverage.
Insurance against the risk of an economic loss assumed by a plan sponsor under a less than fully underwritten employee health benefit plan is subject to the following:
(1)	The policy must be issued by a licensed insurer to the employer, trustee, other sponsor of the plan, or the plan itself for the purpose of insuring the purpose or plan but not for the purpose of insuring the employees, members, or participants;
(2)	Payment by the insurer must be made to the employer, to the trustee or other sponsor of the plan, or to the plan itself, but not to the employees, members, participants, or health care providers;
(3)	If the policy establishes an aggregate attaching point or retention, the point or retention may not be less than the greater of:
a.	One hundred twenty percent (120%) of the expected claims against the health benefit plan; or
b.	One hundred fifty thousand dollars ($150,000) for one plan year; and
(4)	If the policy establishes an attaching point or retention applicable to each individual, the point or retention must not be less than twenty-five thousand dollars ($25,000)."
Sec. 2.  G.S. 58-50-130(a)(2) reads as rewritten:
"(2)	In determining whether a preexisting-conditions provision applies to an eligible employee or to a dependent, all health benefit plans shall credit the time the person was covered under a previous group health benefit plan if the previous coverage was continuous to a date not more than 60 days before the effective date of the new coverage, exclusive of any applicable waiting period under the plan.  As used in this subdivision with respect to previous coverage, 'health benefit plan' is not limited to plans subject to this act under G.S. 58-50-115."
Sec. 3.  G.S. 58-51-80(b)(3) reads as rewritten:
"(3)	Policies may contain a provision limiting coverage for preexisting conditions.  Preexisting conditions must be covered no later than 12 months after the effective date of coverage.  Preexisting conditions are defined as 'those conditions for which medical advice or treatment was received or recommended or which could be medically documented within the 12-month period immediately preceding the effective date of the person's coverage.'  Preexisting conditions exclusions may not be implemented by any successor plan as to any covered persons who have already met all or part of the waiting period requirements under any previous plan.  Credit must be given for that portion of the waiting period which was met under the previous plan. As used in this subdivision, a 'previous plan' includes any health benefit plan provided by a health insurer, as those terms are defined in G.S. 58-51-115, or any government plan or program providing health benefits or health care.  For employer groups of 50 or more persons and for groups under subdivision (1a) of this subsection and under G.S. 58-51-81:  In determining whether a preexisting condition provision applies to an eligible employee, association member, student, or to a dependent, all health benefit plans shall credit the time the person was covered under a previous plan if the previous plan's coverage was continuous to a date not more than 60 days before the effective date of the new coverage, exclusive of any applicable waiting period under the new coverage."
Sec. 4.  G.S. 58-51-80(h) reads as rewritten:
"(h)	Nothing contained in this section applies to any contract issued by any corporation defined in Article 65 of this Chapter. Subdivision (b)(3) of this section applies to MEWAs, as defined in G.S. 58-49-30(a)."
Sec. 5.  G.S. 58-65-60(e)(2) reads as rewritten:
"(2)	Employer master group contracts may contain a provision limiting coverage for preexisting conditions.  Preexisting conditions must be covered no later than 12 months after the effective date of coverage.  Preexisting conditions are defined as 'those conditions for which medical advice or treatment was received or recommended or which could be medically documented within the 12-month period immediately preceding the effective date of the person's coverage.'  Preexisting conditions exclusions may not be implemented by any successor plan as to any covered persons who have already met all or part of the waiting period requirements under any previous plan.  Credit must be given for that portion of the waiting period which was met under the previous plan.  As used in this subdivision, a 'previous plan' includes any health benefit plan provided by a health insurer, as those terms are defined in G.S. 58-51-115, or any government plan or program providing health benefits or health care.  For employer groups of 50 or more persons: In determining whether a preexisting condition provision applies to an eligible employee or to a dependent, all health benefit plans shall credit the time the person was covered under a previous plan if the previous plan's coverage was continuous to a date not more than 60 days before the effective date of the new coverage, exclusive of any applicable waiting period under the new coverage."
Sec. 6.  G.S. 58-67-85(c) reads as rewritten:
"(c)	Employer master group contracts may contain a provision limiting coverage for preexisting conditions.  Preexisting conditions must be covered no later than 12 months after the effective date of coverage.  Preexisting conditions are defined as 'those conditions for which medical advice or treatment was received or recommended or which could be medically documented within the 12-month period immediately preceding the effective date of the person's coverage.'  Preexisting conditions exclusions may not be implemented by any successor plan as to any covered persons who have already met all or part of the waiting period requirements under any previous plan.  Credit must be given for that portion of the waiting period which was met under the previous plan.  As used in this subdivision, a 'previous plan' includes any health benefit plan provided by a health insurer, as those terms are defined in G.S. 58-51-115, or any government plan or program providing health benefits or health care.  In determining whether a preexisting condition provision applies to an eligible employee or to a dependent, all health benefit plans shall credit the time the person was covered under a previous plan if the previous plan's coverage was continuous to a date not more than 60 days before the effective date of the new coverage, exclusive of any applicable waiting period under the new coverage."
Sec. 7.  G.S. 58-51-15(a)(2)b. reads as rewritten:
"b.	This policy contains a provision limiting coverage for preexisting conditions.  Preexisting conditions must be covered no later than one year after the effective date of coverage.  Preexisting conditions are defined as 'those conditions for which medical advice or treatment was received or recommended or that could be medically documented within the one-year period immediately preceding the effective date of the person's coverage.'  Preexisting conditions exclusions may not be implemented by any successor plan as to any covered persons who have already met all or part of the waiting period requirements under any previous plan.  Credit must be given for that portion of the waiting period that was met under the previous plan.  As used in this policy, the term 'previous plan' includes any health benefit plan provided by a health insurer, as those terms are defined in G.S. 58-51-115, or any government plan or program providing health benefits or health care.  In determining whether a preexisting condition provision applies to an insured person, all health benefit plans must credit the time the person was covered under a previous plan if the previous plan's coverage was continuous to a date not more than 60 days before the effective date of the new coverage, exclusive of any applicable waiting period under the new coverage."
Sec. 8. This act is effective upon ratification and applies to all plans and policies with an inception, renewal, or anniversary date on or after October 1, 1995.