(b) The term "policy of stop loss or excess loss insurance coverage" means a policy, contract, endorsement, attachments, amendments or other modifications that insure against losses of the policyholder issued by a stock, or mutual company or association or any other insurer.
History: L. 1951, ch. 296, § 1; L. 1997, ch. 190, § 24; July 1.
(1) The entire money and other considerations therefor are expressed therein;
(2) the time at which the insurance takes effect and terminates is expressed therein;
(3) it purports to insure only one person, except that a policy may insure, originally or by subsequent amendment, upon the application of an adult member of a family who shall be deemed the policyholder, any two or more eligible members of such family, including husband, wife, dependent children or any children under a specified age which shall not exceed nineteen years and any other person dependent upon the policyholder;
(4) the style, arrangement and over-all appearance of the policy give no undue prominence to any portion of the text, and unless every printed portion of the text of the policy and of any endorsements or attached papers is plainly printed in lightfaced type of a style in general use, the size of which shall be uniform and not less than 10-point with a lower-case unspaced alphabet length not less than 120-point (the "text" shall include all printed matter except the name and address of the insurer, name or title of the policy, the brief description if any, and captions and subcaptions);
(5) the exceptions and reductions of indemnity are set forth in the policy and, except those which are set forth in K.S.A. 40-2203 and amendments thereto, are printed, at the insurer's option, either included with the benefit provision to which they apply, or under an appropriate caption such as "Exceptions," or "Exceptions and reductions," provided, that if an exception or reduction specifically applies only to a particular benefit of the policy, a statement of such exception or reduction shall be included with the benefit provision to which it applies;
(6) each such form, including riders and endorsements, shall be identified by a form number in the lower left-hand corner of the first page thereof;
(7) it contains no provision purporting to make any portion of the charter, rules, constitution, or bylaws of the insurer a part of the policy unless such portion is set forth in full in the policy, except in the case of the incorporation of, or reference to, a statement of rates or classification of risks, or short-rate table filed with the commissioner of insurance; and
(8) any provision purporting to base the payment of benefits on "usual, customary and reasonable charges" or a standard of similar import is specifically defined and the determination of payable benefits is developed from a statistically valid sample which: (A) Equitably recognizes geographic variations; (B) is produced at least every six months; and (C) is collected on the basis of the most current codes and nomenclature developed and maintained by recognized authorities.
(b) If any policy is issued by an insurer domiciled in this state for delivery to a person residing in another state, and if the official having responsibility for the administration of the insurance laws of such other state shall have advised the commissioner of insurance that any such policy is not subject to approval or disapproval by such official, the commissioner of insurance may by ruling require that such policy meet the standards set forth in subsection (a) of this section and in K.S.A. 40-2203 and amendments thereto.
History: L. 1951, ch. 296, § 2; L. 1994, ch. 16, § 1; L. 2004, ch. 128, § 5; July 1.
(1) A provision as follows: "Entire contract; changes: This policy, including the endorsement and the attached papers, if any, constitutes the entire contract of insurance. No change in this policy shall be valid until approved by an executive officer of the insurer and unless such approval be endorsed hereon or attached hereto. No agent has authority to change this policy or to waive any of its provisions."
(2) A provision as follows: "Time limit on certain defenses: (a) After two years from the date of issue of this policy no misstatements, except fraudulent misstatement, made by the applicant in the application for such policy shall be used to void the policy or to deny a claim for loss incurred or disability (as defined in the policy) commencing after the expiration of such two-year period."
The foregoing policy provision shall not be so construed as to affect any legal requirement for avoidance of a policy or denial of a claim during such initial two year period, nor to limit the application of subsections (B) (1), (2), (3), (4) and (5) in the event of misstatement with respect to age or occupation or other insurance.
A policy which the insured has the right to continue in force subject to its terms by the timely payment of premium (1) until at least age 50, or (2) in the case of a policy issued after age 44, for at least five years from its date of issue, may contain in lieu of the foregoing the following provision (from which the clause in parentheses may be omitted at the insurer's option) under the caption "Incontestable": "After this policy has been in force for a period of two years during the lifetime of the insured (excluding any period during which the insured is disabled), it shall become incontestable as to the statements contained in the application.
(b) "No claim for loss incurred or disability (as defined in the policy) commencing after two years from the date of issue of this policy shall be reduced or denied on the ground that a disease or physical condition not excluded from coverage by name or specific description effective on the date of loss has existed prior to the effective date of coverage of this policy."
(3) A provision as follows: "Grace period: A grace period of __________" (insert a number not less than "7" for weekly premium policies, "10" for monthly premium policies and "31" for all other policies) "days will be granted for the payment of each premium falling due after the first premium, during which grace period the policy shall continue in force." A policy which contains a cancellation provision may add, at the end of the above provision, "subject to the right of the insurer to cancel in accordance with the cancellation provision hereof." A policy in which the insurer reserves the right to refuse any renewal shall have, at the beginning of the above provision, "Unless not less than five days prior to the premium due date the insurer has delivered to the insured or has mailed to the last address as shown by the records of the insurer written notice of its intention not to renew this policy beyond the period for which the premium has been accepted."
(4) A provision as follows: "Reinstatement: If any renewal premium be not paid within the time granted the insured for payment, a subsequent acceptance of premium by the insurer or by any agent duly authorized by the insurer to accept such premium without requiring in connection therewith an application for reinstatement shall reinstate the policy. If the insurer or such agent requires an application for reinstatement and issues a conditional receipt for the premium tendered, the policy will be reinstated upon approval of such application by the insurer or, lacking such approval, upon the 45th day following the date such conditional receipt unless the insurer has previously notified the insured in writing of its disapproval of such application. The reinstated policy shall cover only loss resulting from such accidental injury as may be sustained after the date of reinstatement and loss due to such sickness as may begin more than ten days after such date. In all other respects the insured and insurer shall have the same rights thereunder as they had under the policy immediately before the due date of the defaulted premium, subject to any provisions endorsed hereon or attached hereto in connection with the reinstatement. Any premium accepted in connection with a reinstatement shall be applied to a period for which premium has not been previously paid, but not to any period more than 60 days prior to the date of reinstatement." The last sentence of the above provision may be omitted from any policy which the insured has the right to continue in force subject to its terms by the timely payment of premiums (1) until at least age 50 or, (2) in the case of a policy issued after age 44, for at least five years from its date of issue.
(5) A provision as follows: "Notice of claim: Written notice of claim must be given to the insurer within 20 days after the occurrence or commencement of any loss covered by the policy, or as soon thereafter as is reasonably possible. Notice given by or on behalf of the insured or the beneficiary to the insurer at ______________" (insert the location of such office as the insurer may designate for the purpose), "or to any authorized agent of the insurer, with information sufficient to identify the insured, shall be deemed notice to the insurer." In a policy providing a loss-of-time benefit which may be payable for at least two years, an insurer may at its option insert the following between the first and second sentences of the above provisions: "Subject to the qualification set forth below, if the insured suffers loss of time on account of disability for which indemnity may be payable for at least two years, he shall, at least once in every six months after having given notice of claim, give to the insurer notice of continuance of said disability, except in the event of legal incapacity. The period of six months following any filing of proof by the insured or any payment by the insurer on account of such claim or any denial of liability in whole or in part by the insurer shall be excluded in applying this provision. Delay in the giving of such notice shall not impair the insured's right to any indemnity which would otherwise have accrued during the period of six months preceding the date on which such notice is actually given.
(6) A provision as follows: "Claim forms: The insurer, upon receipt of a notice of claim, will furnish to the claimant such forms as are usually furnished by it for filing proofs of loss. If such forms are not furnished within 15 days after the giving of such notice the claimant shall be deemed to have complied with the requirements of this policy as to proof of loss upon submitting within the time fixed in the policy for filing proofs of loss, written proof covering the occurrence, the character and the extent of the loss for which claim is made."
(7) A provision as follows: "Proofs of loss: Written proof of loss must be furnished to the insurer at its said office in case of claim for loss for which this policy provides any periodic payment contingent upon continuing loss within 90 days after the termination of the period for which the insurer is liable and in case of claim for any other loss within 90 days after the date of such loss. Failure to furnish such proof within the time required shall not invalidate nor reduce any claim if it was not reasonably possible to give proof within such time, provided such proof is furnished as soon as reasonably possible and in no event, except in the absence of legal capacity, later than one year from the time proof is otherwise required."
(8) A provision as follows: "Time of payment of claims: Indemnities payable under this policy for any loss other than loss for which this policy provides any periodic payment will be paid immediately upon receipt of due written proof of such loss. Subject to due written proof of loss, all accrued indemnities for loss for which this policy provides periodic payment will be paid ______" (insert period for payment which must not be less frequently than monthly) "and any balance remaining unpaid upon the termination of liability will be paid immediately upon receipt of due written proof."
(9) A provision as follows: "Payment of claims: Indemnity for loss of life will be payable in accordance with the beneficiary designation and the provisions respecting such payment which may be prescribed herein and effective at the time of payment. If no such designation or provision is then effective, such indemnity shall be payable to the estate of the insured. Any other accrued indemnities unpaid at the insured's death, at the option of the insurer, may be paid either to such beneficiary or to such estate. All other indemnities will be payable to the insured." The following provisions, or either of them, may be included with the foregoing provision at the option of the insurer: "If any indemnity of this policy shall be payable to the estate of the insured, or to an insured or beneficiary who is a minor or otherwise not competent to give a valid release, the insurer may pay such indemnity, up to an amount not exceeding $______" (insert an amount which shall not exceed $1,000), "to any relative by blood or connection by marriage of the insured or beneficiary who is deemed by the insurer to be equitably entitled thereto. Any payment made by the insurer in good faith pursuant to this provision shall fully discharge the insurer to the extent of such payment. Subject to any written direction of the insured in the application or otherwise all or a portion of any indemnities provided by this policy on account of hospital, nursing, medical, or surgical services may, at the insurer's option and unless the insured requests otherwise in writing not later than the time of filing proofs of such loss, be paid directly to the hospital or person rendering such services; but it is not required that the service be rendered by a particular hospital or person."
(10) A provision as follows: "Physical examinations and autopsy: The insurer at its own expense shall have the right and opportunity to examine the person of the insured when and as often as it may reasonably require during the pendency of a claim hereunder and to make an autopsy in case of death where it is not forbidden by law."
(11) A provision as follows: "Legal actions: No action at law or in equity shall be brought to recover on this policy prior to the expiration of 60 days after written proof of loss has been furnished in accordance with the requirements of this policy. No such action shall be brought after the expiration of five years after the time written proof of loss is required to be furnished."
(12) A provision as follows: "Change of beneficiary: Unless the insured makes an irrevocable designation of beneficiary, the right to change of beneficiary is reserved to the insured and the consent of the beneficiary or beneficiaries shall not be requisite to surrender or assignment of this policy or to any change of beneficiary or beneficiaries, or to any other changes in this policy."
The first clause of this provision, relating to the irrevocable designation of beneficiary, may be omitted at the insurer's option.
(13) A provision as follows: "Cancellation by insured: The insured may cancel this policy at any time by written notice delivered or mailed to the insurer, effective upon receipt of such notice or on such later date as may be specified in such notice. In the event of cancellation or death of the insured, the insurer will promptly return the unearned portion of any premium paid. The earned premium shall be computed by the use of the short-rate table last filed with the state official having supervision of insurance in the state where the insured resided when the policy was issued. Cancellation shall be without prejudice to any claim originating prior to the effective date of cancellation." When approved by the commissioner, the "cancellation" provision appearing in subsection (B)(8) may be substituted for the above.
(B) Other provisions: Except as provided in paragraph (C) of this section, no such policy delivered or issued for delivery to any person in this state shall contain provisions respecting the matters set forth below unless such provisions are in the words in which the same appear in this section, but the insurer may, at its option, use in lieu of any such provision a corresponding provision of different wording approved by the commissioner of insurance which is not less favorable in any respect to the insured or the beneficiary. Any such provision contained in the policy shall be preceded individually by the appropriate caption appearing in this subsection or, at the option of the insurer, by such appropriate individual or group captions or subcaptions as the commissioner of insurance may approve.
(1) A provision as follows: "Change of occupation: If the insured be injured or contract sickness after having changed his occupation to one classified by the insurer as more hazardous than that stated in this policy or while doing for compensation anything pertaining to an occupation so classified, the insurer will pay only such portion of the indemnities provided in this policy as the premium paid would have purchased at the rates and within the limits fixed by the insurer for such more hazardous occupation. If the insured changes his occupation to one classified by the insurer as less hazardous than that stated in this policy, the insurer, upon receipt of proof of such change of occupation, will reduce the premium rate accordingly, and will return the excess pro rata unearned premium from the date of change of occupation or from the policy anniversary date immediately preceding receipt of such proof, whichever is the more recent. In applying this provision, the classification of occupational risk and the premium rates shall be such as have been last filed by the insurer prior to the occurrence of the loss for which the insurer is liable or prior to date of proof of change in occupation with the state official having supervision of insurance in the state where the insured resided at the time this policy was issued; but if such filing was not required, then the classification of occupational risk and the premium rates shall be those last made effective by the insurer in such state prior to the occurrence of the loss or prior to the date of proof of change in occupation."
(2) A provision as follows: "Misstatement of age: If the age of the insured has been misstated, all amounts payable under this policy shall be such as the premium paid would have purchased at the correct age."
(3) A provision as follows: "Other insurance in this insurer: If an accident or sickness or accident and sickness policy or policies previously issued by the insurer to the insured be in force concurrently herewith, making the aggregate indemnity for __________" (insert type of coverage or coverages) "in excess of _______" (insert maximum limit of indemnity or indemnities) "the excess insurance shall be void and all premiums paid for such excess shall be returned to the insured or to his estate"; or, in lieu thereof: "Insurance effective at any one time on the insured under a like policy or policies in this insurer is limited to one such policy elected by the insured, his beneficiary or his estate, as the case may be, and the insurer will return all premiums paid for all other such policies."
(4) A provision as follows: "Insurance with other insurers: If there be other valid coverage, not with this insurer, providing benefits for the same loss on a provision of service basis or on an expense incurred basis and of which this insurer has not been given written notice prior to the occurrence or commencement of loss, the only liability under any expense incurred coverage of this policy shall be for such proportion of the loss as the amount which would otherwise have been payable hereunder plus the total of the like amounts under all such other valid coverages for the same loss of which this insurer had notice bears to the total like amounts under all valid coverages for such loss, and for the return of such portion of the premiums paid as shall exceed the pro rata portion for the amount so determined. For the purpose of applying this provision when other coverage is on a provision of service basis, the 'like amount' of such other coverage shall be taken as the amount which the services rendered would have cost in the absence of such coverage." If the foregoing policy provision is included in a policy which also contains the next following policy provision there shall be added to the caption of the foregoing provision the phrase "__________ expense incurred benefits." The insurer, at its option, may include in this provision a definition of "other valid coverage," approved as to form by the commissioner of insurance, which definition shall be limited in subject matter to coverage provided by organizations subject to regulation by insurance law or by insurance authorities of this or any other state of the United States or any province of Canada, and by hospital or medical service organizations, and to any other coverage the inclusion of which may be approved by the commissioner of insurance. In the absence of such definition such term shall not include group insurance, automobile medical payments insurance, or coverage provided by hospital or medical service organizations or by union welfare plans or employer or employee benefit organizations. For the purpose of applying the foregoing policy provision with respect to any insured, any amount of benefit provided for such insured pursuant to any compulsory benefit statute (including any workmen's compensation or employer's liability statute) whether provided by a governmental agency or otherwise shall in all cases be deemed to be "other valid coverage" of which the insurer has had notice. In applying the foregoing policy provision no third party liability coverage shall be included as "other valid coverage."
(5) A provision as follows: "Insurance with other insurers: If there be other valid coverage, not with this insurer, providing benefits for the same loss on other than an expense incurred basis and of which this insurer has not been given written notice prior to the occurrence or commencement of loss, the only liability for such benefits under this policy shall be for such proportion of the indemnities otherwise provided hereunder for such loss as the like indemnities of which the insurer had notice (including the indemnities under this policy) bear to the total amount of all like indemnities for such loss, and the return of such portion of the premium paid as shall exceed the pro rata portion for the indemnities thus determined." If the foregoing policy provision is included in a policy which also contains the next preceding policy provision there shall be added to the caption of the foregoing provision the phrase "__________ other benefits." The insurer, at its option, may include in this provision a definition of "other valid coverage," approved as to form by the commissioner of insurance, which definition shall be limited in subject matter to coverage provided by organizations subject to regulation by insurance law or by insurance authorities of this or any other state of the United States or any province of Canada, and to any other coverage the inclusion of which may be approved by the commissioner of insurance. In the absence of such definition such term shall not include group insurance, or benefits provided by union welfare plans or by employer or employee benefit organizations. For the purpose of applying the foregoing policy provision with respect to any insured, any amount of benefit provided for such insured pursuant to any compulsory benefit statute (including any workers compensation or employer's liability statute) whether provided by a governmental agency or otherwise shall in all cases be deemed to be "other valid coverage" of which the insurer has had notice. In applying the foregoing policy provision no third-party liability coverage shall be included as "other valid coverage."
(6) A provision as follows: "Relation of earnings to insurance: If the total monthly amount of loss of time benefits promised for the same loss under all valid loss of time coverage upon the insured, whether payable on a weekly or monthly basis, shall exceed the monthly earnings of the insured at the time disability commenced or the average monthly earnings for the period of two years immediately preceding a disability for which claim is made, whichever is the greater, the insurer will be liable only for such proportionate amount of such benefits under this policy as the amount of such monthly earnings or such average monthly earnings of the insured bears to the total amount of monthly benefits for the same loss under all such coverage upon the insured at the time such disability commences and for the return of such part of the premiums paid during such two years as shall exceed the pro rata amount of the premiums for the benefits actually paid hereunder; but this shall not operate to reduce the total monthly amount of benefits payable under all such coverage upon the insured below the sum of $200 or the sum of the monthly benefits specified in such coverages, whichever is the lesser, nor shall it operate to reduce benefits other than those payable for loss of time." The foregoing policy provision may be inserted only in a policy which the insured has the right to continue in force subject to its terms by the timely payment of premiums (1) until at least age 50, or (2) in the case of a policy issued after age 44, for at least five years from its date of issue. The insurer, at its option, may include in this provision a definition of "valid loss of time coverage," approved as to form by the commissioner of insurance, which definition shall be limited in subject matter to coverage provided by governmental agencies or by organizations subject to regulation by insurance law or by insurance authorities of this or any other state of the United States or any province of Canada, or to any other coverage the inclusion of which may be approved by the commissioner of insurance or any combination of such coverages. In the absence of such definition such term shall not include any coverage provided for such insured pursuant to any compulsory benefit statute (including any workers compensation or employer's liability statute), or benefits provided by union welfare plans or by employer or employee benefit organizations.
(7) A provision as follows: "Unpaid premium: Upon the payment of a claim under this policy, any premium then due and unpaid or covered by any note or written order may be deducted therefrom."
(8) A provision as follows: "Cancellation: The insurer may cancel this policy at any time by written notice delivered to the insured, or mailed to his last address as shown by the records of the insurer, stating when, not less than five days thereafter, such cancellation shall be effective; and after the policy has been continued beyond its original term the insured may cancel this policy at any time by written notice delivered or mailed to the insurer, effective upon receipt or on such later date as may be specified in such notice. In the event of cancellation, the insurer will return promptly the unearned portion of any premium paid. If the insured cancels, the earned premium shall be computed by the use of the short-rate table last filed with the state official having supervision of insurance in the state where the insured resided when the policy was issued. If the insurer cancels, the earned premium shall be computed pro rata. Cancellation shall be without prejudice to any claim originating prior to the effective date of cancellation."
(9) A provision as follows: "Conformity with state statutes: Any provision of this policy which, on its effective date, is in conflict with the statutes of the state in which the insured resides on such date is hereby amended to conform to the minimum requirements of such statutes."
(10) A provision as follows: "Illegal occupation: The insurer shall not be liable for any loss to which a contributing cause was the insured's commission of or attempt to commit a felony or to which a contributing cause was the insured's being engaged in an illegal occupation."
(11) A provision as follows: "Intoxicants and narcotics: The insurer shall not be liable for any loss sustained or contracted in consequence of the insured's being intoxicated or under the influence of any narcotic unless administered on the advice of a physician."
(C) Inapplicable or inconsistent provisions: If any provision of this section is in whole or in part inapplicable to or inconsistent with the coverage provided by a particular form of policy the insurer, with the approval of the commissioner of insurance, shall omit from such policy any inapplicable provision or part of a provision, and shall modify any inconsistent provision or part of the provision in such manner as to make the provision as contained in the policy consistent with the coverage provided by the policy.
(D) Order of certain policy provisions: The provisions which are the subject of subsection (A) and (B) of this section, or any corresponding provisions which are used in lieu thereof in accordance with such subsections, shall be printed in the consecutive order of the provisions in such subsections or, at the option of the insurer, any such provision may appear as a unit in any part of the policy, with other provisions to which it may be logically related, provided the resulting policy, shall not be in whole or in part unintelligible, uncertain, ambiguous, abstruse, or likely to mislead a person to whom the policy is offered, delivered or issued.
(E) Third-party ownership: The word "insured," as used in this act, shall not be construed as preventing a person other than the insured with a proper insurable interest from making application for and owning a policy covering the insured or from being entitled under such a policy to any indemnities, benefits and rights provided therein.
(F) Requirements of other jurisdictions: (1) Any policy of a foreign or alien insurer, when delivered or issued for delivery to any person in this state, may contain any provision which is not less favorable to the insured or the beneficiary than the provisions of this act and which is prescribed or required by the law of the state under which the insurer is organized.
(2) Any policy of a domestic insurer, when issued for delivery in any other state or country, may contain any provision permitted or required by the laws of such other state or country.
(G) Filing procedure: The commissioner of insurance may make such reasonable rules and regulations concerning the procedure for the filing or submission of policies subject to this act as are necessary, proper or advisable to the administration of this act. This provision shall not abridge any other authority granted the commissioner of insurance by law.
(H) (1) No policy issued by an insurer to which this section applies shall contain a provision which excludes, limits or otherwise restricts coverage because medicaid benefits as permitted by title XIX of the social security act of 1965 are or may be available for the same accident or illness.
(2) Violation of this subsection shall be subject to the penalties prescribed by K.S.A. 40-2407 and 40-2411, and amendments thereto.
History: L. 1951, ch. 296, § 3; L. 1965, ch. 304, § 1; L. 1989, ch. 138, § 1; L. 1993, ch. 132, § 6; July 1.
(B) Policy conflicting with this act. A policy delivered or issued for delivery to any person in this state in violation of this act shall be held valid but shall be construed as provided in this act. When any provision in a policy subject to this act is in conflict with any provision of this act, the rights, duties and obligations of the insurer, the insured and the beneficiary shall be governed by the provisions of this act.
History: L. 1951, ch. 296, § 4; June 30.
(B) No alteration of any written application for any such policy shall be made by any person other than the applicant without his written consent, except that insertions may be made by the insurer, for administrative purposes only, in such manner as to indicate clearly that such insertions are not to be ascribed to the applicant.
(C) The falsity of any material statement in the application for any policy covered by this act may not bar the right to recovery thereunder unless the false statement has actually contributed to the contingency or event on which the policy is to become due and payable: Provided, however, That any recovery resulting from the operation of this section shall not bar the right to render the policy void in accordance with its provisions.
History: L. 1951, ch. 296, § 5; L. 1963, ch. 264, § 1; L. 1965, ch. 305, § 1; June 30.
History: L. 1951, ch. 296, § 6; June 30.
History: L. 1951, ch. 296, § 7; June 30.
History: L. 1951, ch. 296, § 8; L. 1957, ch. 284, § 2; June 29.
(2) An eligible employee, member or dependent who requests enrollment following the open enrollment opportunity or any special enrollment period for dependents as specified in subsection (3) shall be considered a late enrollee. An accident and sickness insurer may exclude a late enrollee, except during an open enrollment period. However, an eligible employee, member or dependent shall not be considered a late enrollee if:
(A) The individual:
(i) Was covered under another group policy which provided hospital, medical or surgical expense benefits or was covered under section 607(1) of the employee retirement income security act of 1974 (ERISA) at the time the individual was eligible to enroll;
(ii) states in writing, at the time of the open enrollment period, that coverage under another group policy which provided hospital, medical or surgical expense benefits was the reason for declining enrollment, but only if the group policyholder or the accident and sickness insurer required such a written statement and provided the individual with notice of the requirement for a written statement and the consequences of such written statement;
(iii) has lost coverage under another group policy providing hospital, medical or surgical expense benefits or under section 607(1) of the employee retirement income security act of 1974 (ERISA) as a result of the termination of employment, reduction in the number of hours of employment, termination of employer contributions toward such coverage, the termination of the other policy's coverage, death of a spouse or divorce or legal separation or was under a COBRA continuation provision and the coverage under such provision was exhausted; and
(iv) requests enrollment within 30 days after the termination of coverage under the other policy; or
(B) a court has ordered coverage to be provided for a spouse or minor child under a covered employee's or member's policy.
(3) (A) If an accident and sickness insurer issues a group policy providing hospital, medical or surgical expenses and makes coverage available to a dependent of an eligible employee or member and such dependent becomes a dependent of the employee or member through marriage, birth, adoption or placement for adoption, then such group policy shall provide for a dependent special enrollment period as described in subsection (3)(B) of this section during which the dependent may be enrolled under the policy and in the case of the birth or adoption of a child, the spouse of an eligible employee or member may be enrolled if otherwise eligible for coverage.
(B) A dependent special enrollment period under this subsection shall be a period of not less than 30 days and shall begin on the later of (i) the date such dependent coverage is made available, or (ii) the date of the marriage, birth or adoption or placement for adoption.
(C) If an eligible employee or member seeks to enroll a dependent during the first 30 days of such a dependent special enrollment period, the coverage of the dependent shall become effective: (i) in the case of marriage, not later than the first day of the first month beginning after the date the completed request for enrollment is received; (ii) in the case of the birth of a dependent, as of the date of such birth; or (iii) in the case of a dependent's adoption or placement for adoption, the date of such adoption or placement for adoption.
(4) (A) No group policy providing hospital, medical or surgical expense benefits issued or renewed within this state or issued or renewed outside this state covering residents within this state shall limit or exclude benefits for specific conditions existing at or prior to the effective date of coverage thereunder. Such policy may impose a preexisting conditions exclusion, not to exceed 90 days following the date of enrollment for benefits for conditions whether mental or physical, regardless of the cause of the condition for which medical advice, diagnosis, care or treatment was recommended or received in the 90 days prior to the effective date of enrollment. Any preexisting conditions exclusion shall run concurrently with any waiting period.
(B) Such policy may impose a waiting period after full-time employment starts before an employee is first eligible to enroll in any applicable group policy.
(C) A health maintenance organization which offers such policy which does not impose any preexisting conditions exclusion may impose an affiliation period for such coverage, provided that: (i) such application period is applied uniformly without regard to any health status related factors and (ii) such affiliation period does not exceed two months. The affiliation period shall run concurrently with any waiting period under the plan.
(D) A health maintenance organization may use alternative methods from those described in this subsection to address adverse selection if approved by the commissioner.
(E) For the purposes of this section, the term "preexisting conditions exclusion" shall mean, with respect to coverage, a limitation or exclusion of benefits relating to a condition based on the fact that the condition was present before the date of enrollment for such coverage whether or not any medical advice, diagnosis, care or treatment was recommended or received before such date.
(F) For the purposes of this section, the term "date of enrollment" means the date the individual is enrolled under the group policy or, if earlier, the first day of the waiting period for such enrollment.
(G) For the purposes of this section, the term "waiting period" means with respect to a group policy the period which must pass before the individual is eligible to be covered for benefits under the terms of the policy.
(5) Genetic information shall not be treated as a preexisting condition in the absence of a diagnosis of the condition related to such information.
(6) A group policy providing hospital, medical or surgical expense benefits may not impose any preexisting condition exclusion relating to pregnancy as a preexisting condition.
(7) A group policy providing hospital, medical or surgical expense benefits may not impose any preexisting condition waiting period in the case of a child who is adopted or placed for adoption before attaining 18 years of age and who, as of the last day of a 30-day period beginning on the date of the adoption or placement for adoption, is covered by a policy specified in subsection (a). This subsection shall not apply to coverage before the date of such adoption or placement for adoption.
(8) Such policy shall waive such a preexisting conditions exclusion to the extent the employee or member or individual dependent or family member was covered by (A) a group or individual sickness and accident policy, (B) coverage under section 607(1) of the employees retirement income security act of 1974 (ERISA), (C) a group specified in K.S.A. 40-2222 and amendments thereto, (D) part A or part B of title XVIII of the social security act, (E) title XIX of the social security act, other than coverage consisting solely of benefits under section 1928, (F) a state children's health insurance program established pursuant to title XXI of the social security act, (G) chapter 55 of title 10 United States code, (H) a medical care program of the Indian health service or of a tribal organization, (I) the Kansas uninsurable health plan act pursuant to K.S.A. 40-2217 et seq. and amendments thereto or a similar health benefits risk pool of another state, (J) a health plan offered under chapter 89 of title 5, United States code, (K) a health benefit plan under section 5(e) of the peace corps act (22 U.S.C. 2504(e)), or (L) a group subject to K.S.A. 12-2616 et seq. and amendments thereto which provided hospital, medical and surgical expense benefits within 63 days prior to the effective date of coverage with no gap in coverage. A group policy shall credit the periods of prior coverage specified in subsection (a)(7) without regard to the specific benefits covered during the period of prior coverage. Any period that the employee or member is in a waiting period for any coverage under a group health plan or is in an affiliation period shall not be taken into account in determining the continuous period under this subsection.
(b) (1) An accident and sickness insurer which offers group policies providing hospital, medical or surgical expense benefits shall provide a certification as described in subsection (b)(2): (A) At the time an eligible employee, member or dependent ceases to be covered under such policy or otherwise becomes covered under a COBRA continuation provision; (B) in the case of an eligible employee, member or dependent being covered under a COBRA continuation provision, at the time such eligible employee, member or dependent ceases to be covered under a COBRA continuation provision; and (C) on the request on behalf of such eligible employee, member or dependent made not later than 24 months after the date of the cessation of the coverage described in subsection (b)(1) (A) or (b)(1) (B), whichever is later.
(2) The certification described in this subsection is a written certification of (A) the period of coverage under a policy specified in subsection (a) and any coverage under such COBRA continuation provision, and (B) any waiting period imposed with respect to the eligible employee, member or dependent for any coverage under such policy.
(c) Any group policy may impose participation requirements, define full-time employees or members and otherwise be designed for the group as a whole through negotiations between the group sponsor and the insurer to the extent such design is not contrary to or inconsistent with this act.
(d) (1) An accident and sickness insurer offering a group policy providing hospital, medical or surgical expense benefits must renew or continue in force such coverage at the option of the policyholder or certificateholder except as provided in paragraph (2) below.
(2) An accident and sickness insurer may nonrenew or discontinue coverage under a group policy providing hospital, medical or surgical expense benefits based only on one or more of the following circumstances:
(A) If the policyholder or certificateholder has failed to pay any premium or contributions in accordance with the terms of the group policy providing hospital, medical or surgical expense benefits or the accident and sickness insurer has not received timely premium payments;
(B) if the policyholder or certificateholder has performed an act or practice that constitutes fraud or made an intentional misrepresentation of material fact under the terms of such coverage;
(C) if the policyholder or certificateholder has failed to comply with a material plan provision relating to employer contribution or group participation rules;
(D) if the accident and sickness insurer is ceasing to offer coverage in such group market in accordance with subsections (d)(3) or (d)(4);
(E) in the case of accident and sickness insurer that offers coverage under a policy providing hospital, medical or surgical expense benefits through an enrollment area, there is no longer any eligible employee, member or dependent in connection with such policy who lives, resides or works in the medical service enrollment area of the accident and sickness insurer or in the area for which the accident and sickness insurer is authorized to do business; or
(F) in the case of a group policy providing hospital, medical or surgical expense benefits which is offered through an association or trust pursuant to subsections (f)(3) or (f)(5), the membership of the employer in such association or trust ceases but only if such coverage is terminated uniformly without regard to any health status related factor relating to any eligible employee, member or dependent.
(3) In any case in which an accident and sickness insurer which offers a group policy providing hospital, medical or surgical expense benefits decides to discontinue offering such type of group policy, such coverage may be discontinued only if:
(A) The accident and sickness insurer notifies all policyholders and certificateholders and all eligible employees or members of such discontinuation at least 90 days prior to the date of the discontinuation of such coverage;
(B) the accident and sickness insurer offers to each policyholder who is provided such group policy providing hospital, medical or surgical expense benefits which is being discontinued the option to purchase any other group policy providing hospital, medical or surgical expense benefits currently being offered by such accident and sickness insurer; and
(C) in exercising the option to discontinue coverage and in offering the option of coverage under subparagraph (B), the accident and sickness insurer acts uniformly without regard to the claims experience of those policyholders or certificateholders or any health status related factors relating to any eligible employee, member or dependent covered by such group policy or new employees or members who may become eligible for such coverage.
(4) If the accident and sickness insurer elects to discontinue offering group policies providing hospital, medical or surgical expense benefits or group coverage to a small employer pursuant to K.S.A. 40-2209f and amendments thereto, such coverage may be discontinued only if:
(A) The accident and sickness insurer provides notice to the insurance commissioner, to all policyholders or certificateholders and to all eligible employees and members covered by such group policy providing hospital, medical or surgical expense benefits at least 180 days prior to the date of the discontinuation of such coverage;
(B) all group policies providing hospital, medical or surgical expense benefits offered by such accident and sickness insurer are discontinued and coverage under such policies are not renewed; and
(C) the accident and sickness insurer may not provide for the issuance of any group policies providing hospital, medical or surgical expense benefits in the discontinued market during a five year period beginning on the date of the discontinuation of the last such group policy which is nonrenewed.
(e) An accident and sickness insurer offering a group policy providing hospital, medical or surgical expense benefits may not establish rules for eligibility (including continued eligibility) of any employee, member or dependent to enroll under the terms of the group policy based on any of the following factors in relation to the eligible employee, member or dependent: (A) Health status, (B) medical condition, including both physical and mental illness, (C) claims experience, (D) receipt of health care, (E) medical history, (F) genetic information, (G) evidence of insurability, including conditions arising out of acts of domestic violence, or (H) disability. This subsection shall not be construed to require a policy providing hospital, medical or surgical expense benefits to provide particular benefits other than those provided under the terms of such group policy or to prevent a group policy providing hospital, medical or surgical expense benefits from establishing limitations or restrictions on the amount, level, extent or nature of the benefits or coverage for similarly situated individuals enrolled under the group policy.
(f) Group accident and health insurance may be offered to a group under the following basis:
(1) Under a policy issued to an employer or trustees of a fund established by an employer, who is the policyholder, insuring at least two employees of such employer, for the benefit of persons other than the employer. The term "employees" shall include the officers, managers, employees and retired employees of the employer, the partners, if the employer is a partnership, the proprietor, if the employer is an individual proprietorship, the officers, managers and employees and retired employees of subsidiary or affiliated corporations of a corporation employer, and the individual proprietors, partners, employees and retired employees of individuals and firms, the business of which and of the insured employer is under common control through stock ownership contract, or otherwise. The policy may provide that the term "employees" may include the trustees or their employees, or both, if their duties are principally connected with such trusteeship. A policy issued to insure the employees of a public body may provide that the term "employees" shall include elected or appointed officials.
(2) Under a policy issued to a labor union which shall have a constitution and bylaws insuring at least 25 members of such union.
(3) Under a policy issued to the trustees of a fund established by two or more employers or business associations or by one or more labor unions or by one or more employers and one or more labor unions, which trustees shall be the policyholder, to insure employees of the employers or members of the union or members of the association for the benefit of persons other than the employers or the unions or the associations. The term "employees" shall include the officers, managers, employees and retired employees of the employer and the individual proprietor or partners if the employer is an individual proprietor or partnership. The policy may provide that the term "employees" shall include the trustees or their employees, or both, if their duties are principally connected with such trusteeship.
(4) A policy issued to a creditor, who shall be deemed the policyholder, to insure debtors of the creditor, subject to the following requirements: (a) The debtors eligible for insurance under the policy shall be all of the debtors of the creditor whose indebtedness is repayable in installments, or all of any class or classes determined by conditions pertaining to the indebtedness or to the purchase giving rise to the indebtedness. (b) The premium for the policy shall be paid by the policyholder, either from the creditor's funds or from charges collected from the insured debtors, or from both.
(5) A policy issued to an association which has been organized and is maintained for the purposes other than that of obtaining insurance, insuring at least 25 members, employees, or employees of members of the association for the benefit of persons other than the association or its officers. The term "employees" shall include retired employees. The premiums for the policies shall be paid by the policyholder, either wholly from association funds, or funds contributed by the members of such association or by employees of such members or any combination thereof.
(6) Under a policy issued to any other type of group which the commissioner of insurance may find is properly subject to the issuance of a group sickness and accident policy or contract.
(g) Each such policy shall contain in substance: (1) A provision that a copy of the application, if any, of the policyholder shall be attached to the policy when issued, that all statements made by the policyholder or by the persons insured shall be deemed representations and not warranties, and that 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 such person or the insured's beneficiary.
(2) A provision setting forth the conditions under which an individual's coverage terminates under the policy, including the age, if any, to which an individual's coverage under the policy shall be limited, or, the age, if any, at which any additional limitations or restrictions are placed upon an individual's coverage under the policy.
(3) Provisions setting forth the notice of claim, proofs of loss and claim forms, physical examination and autopsy, time of payment of claims, to whom benefits are payable, payment of claims, change of beneficiary, and legal action requirements. Such provisions shall not be less favorable to the individual insured or the insured's beneficiary than those corresponding policy provisions required to be contained in individual accident and sickness policies.
(4) A provision that the insurer will furnish to the policyholder, for the delivery to each employee or member of the insured group, an individual certificate approved by the commissioner of insurance setting forth in summary form a statement of the essential features of the insurance coverage of such employee or member, the procedure to be followed in making claim under the policy and to whom benefits are payable. Such certificate shall also contain a summary of those provisions required under paragraphs (2) and (3) of this subsection (g) in addition to the other essential features of the insurance coverage. If dependents are included in the coverage, only one certificate need be issued for each family unit.
(h) No group disability income policy which integrates benefits with social security benefits, shall provide that the amount of any disability benefit actually being paid to the disabled person shall be reduced by changes in the level of social security benefits resulting either from changes in the social security law or due to cost of living adjustments which become effective after the first day for which disability benefits become payable.
(i) A group policy of insurance delivered or issued for delivery or renewed which provides hospital, surgical or major medical expense insurance, or any combination of these coverages, on an expense incurred basis, shall provide that an employee or member or such employee's or member's covered dependents whose insurance under the group policy has been terminated for any reason, including discontinuance of the group policy in its entirety or with respect to an insured class, and who has been continuously insured under the group policy or under any group policy providing similar benefits which it replaces for at least three months immediately prior to termination, shall be entitled to have such coverage nonetheless continued under the group policy for a period of 18 months and have issued to the employee or member or such employee's or member's covered dependents by the insurer, at the end of such eighteen-month period of continuation, a policy of health insurance which conforms to the applicable requirements specified in this subsection. This requirement shall not apply to a group policy which provides benefits for specific diseases or for accidental injuries only or a group policy issued to an employer subject to the continuation and conversion obligations set forth at title I, subtitle B, part 6 of the employee retirement income security act of 1974 or at title XXII of the public health service act, as each act was in effect on January 1, 1987 to the extent federal law provides the employee or member or such employee's or member's covered dependents with equal or greater continuation or conversion rights; or an employee or member or such employee's or member's covered dependents shall not be entitled to have such coverage continued or a converted policy issued to the employee or member or such employee's or member's covered dependents if termination of the insurance under the group policy occurred because:
(1) The employee or member or such employee's or member's covered dependents failed to pay any required contribution after receiving reasonable notice of such required contribution from the insurer in accordance with rules and regulations adopted by the commissioner of insurance; (2) any discontinued group coverage was replaced by similar group coverage within 31 days; (3) the employee or member is or could be covered by medicare (title XVIII of the United States social security act as added by the social security amendments of 1965 or as later amended or superseded); (4) the employee or member is or could be covered to the same extent by any other insured or lawful self-insured arrangement which provides expense incurred hospital, surgical or medical coverage and benefits for individuals in a group under which the person was not covered prior to such termination; or (5) coverage for the employee or member, or any covered dependent thereof, was terminated for cause as permitted by the group policy or certificate of coverage approved by the commissioner. In the event the group policy is terminated and not replaced the insurer may issue an individual policy or certificate in lieu of a conversion policy or the continuation of group coverage required herein if the individual policy or certificate provides substantially similar coverage for the same or less premium as the group policy. In any event, the employee or member shall have the option to be issued a conversion policy which meets the requirements set forth in this subsection in lieu of the right to continue group coverage.
(j) The continued coverage and the issuance of a converted policy shall be subject to the following conditions:
(1) Written application for the converted policy shall be made and the first premium paid to the insurer not later than 31 days after termination of coverage under the group policy or not later than 31 days after notice is received pursuant to paragraph (20) of this subsection.
(2) The converted policy shall be issued without evidence of insurability.
(3) The employer shall give the employee and such employee's covered dependents reasonable notice of the right to continuation of coverage. The terminated employee or member shall pay to the insurance carrier the premium for the eighteen-month continuation of coverage and such premium shall be the same as that applicable to members or employees remaining in the group. Failure to pay such premium shall terminate coverage under the group policy at the end of the period for which the premium has been paid. The premium rate charged for converted policies issued subsequent to the period of continued coverage shall be such that can be expected to produce an anticipated loss ratio of not less than 80% based upon conversion, morbidity and reasonable assumptions for expected trends in medical care costs. In the event the group policy is terminated and is not replaced, converted policies may be issued at self-sustaining rates that are not unreasonable in relation to the coverage provided based on conversion, morbidity and reasonable assumptions for expected trends in medical care costs. The frequency of premium payment shall be the frequency customarily required by the insurer for the policy form and plan selected, provided that the insurer shall not require premium payments less frequently than quarterly.
(4) The effective date of the converted policy shall be the day following the termination of insurance under the group policy.
(5) The converted policy shall cover the employee or member and the employee's or member's dependents who were covered by the group policy on the date of termination of insurance. At the option of the insurer, a separate converted policy may be issued to cover any dependent.
(6) The insurer shall not be required to issue a converted policy covering any person if such person is or could be covered by medicare (title XVIII of the United States social security act as added by the social security amendments of 1965 or as later amended or superseded). Furthermore, the insurer shall not be required to issue a converted policy covering any person if:
(A) (i) Such person is covered for similar benefits by another hospital, surgical, medical or major medical expense insurance policy or hospital or medical service subscriber contract or medical practice or other prepayment plan or by any other plan or program, or
(ii) such person is eligible for similar benefits (whether or not covered therefor) under any arrangement of coverage for individuals in a group, whether on an insured or uninsured basis, or
(iii) similar benefits are provided for or available to such person, pursuant to or in accordance with the requirements of any state or federal law, and
(B) the benefits provided under the sources referred to in clause (A) (i) above for such person or benefits provided or available under the sources referred to in clauses (A) (ii) and (A) (iii) above for such person, together with the benefits provided by the converted policy, would result in over-insurance according to the insurer's standards. The insurer's standards must bear some reasonable relationship to actual health care costs in the area in which the insured lives at the time of conversion and must be filed with the commissioner of insurance prior to their use in denying coverage.
(7) A converted policy may include a provision whereby the insurer may request information in advance of any premium due date of such policy of any person covered as to whether:
(A) Such person is covered for similar benefits by another hospital, surgical, medical or major medical expense insurance policy or hospital or medical service subscriber contract or medical practice or other prepayment plan or by any other plan or program;
(B) such person is covered for similar benefits under any arrangement of coverage for individuals in a group, whether on an insured or uninsured basis; or
(C) similar benefits are provided for or available to such person, pursuant to or in accordance with the requirements of any state or federal law.
(8) The converted policy may provide that the insurer may refuse to renew the policy and the coverage of any person insured for the following reasons only:
(A) Either the benefits provided under the sources referred to in clauses (A)(i) and (A)(ii) of paragraph (6) for such person or benefits provided or available under the sources referred to in clause (A)(iii) of paragraph (6) for such person, together with the benefits provided by the converted policy, would result in over-insurance according to the insurer's standards on file with the commissioner of insurance, or the converted policyholder fails to provide the requested information;
(B) fraud or material misrepresentation in applying for any benefits under the converted policy; or
(C) other reasons approved by the commissioner of insurance.
(9) An insurer shall not be required to issue a converted policy which provides coverage and benefits in excess of those provided under the group policy from which conversion is made.
(10) If the converted policy provides that any hospital, surgical or medical benefits payable may be reduced by the amount of any such benefits payable under the group policy after the termination of the individual's insurance or the converted policy includes provisions so that during the first policy year the benefits payable under the converted policy, together with the benefits payable under the group policy, shall not exceed those that would have been payable had the individual's insurance under the group policy remained in force and effect, the converted policy shall provide credit for deductibles, copayments and other conditions satisfied under the group policy.
(11) Subject to the provisions and conditions of this act, if the group insurance policy from which conversion is made insures the employee or member for major medical expense insurance, the employee or member shall be entitled to obtain a converted policy providing catastrophic or major medical coverage under a plan meeting the following requirements:
(A) A maximum benefit at least equal to either, at the option of the insurer, paragraphs (i) or (ii) below:
(i) The smaller of the following amounts:
The maximum benefit provided under the group policy or a maximum payment of $250,000 per covered person for all covered medical expenses incurred during the covered person's lifetime.
(ii) The smaller of the following amounts:
The maximum benefit provided under the group policy or a maximum payment of $250,000 for each unrelated injury or sickness.
(B) Payment of benefits at the rate of 80% of covered medical expenses which are in excess of the deductible, until 20% of such expenses in a benefit period reaches $1,000, after which benefits will be paid at the rate of 100% during the remainder of such benefit period. Payment of benefits for outpatient treatment of mental illness, if provided in the converted policy, may be at a lesser rate but not less than 50%.
(C) A deductible for each benefit period which, at the option of the insurer, shall be (i) the sum of the benefits deductible and $100, or (ii) the corresponding deductible in the group policy. The term "benefits deductible," as used herein, means the value of any benefits provided on an expense incurred basis which are provided with respect to covered medical expenses by any other hospital, surgical, or medical insurance policy or hospital or medical service subscriber contract or medical practice or other prepayment plan, or any other plan or program whether on an insured or uninsured basis, or in accordance with the requirements of any state or federal law and, if pursuant to the conditions of paragraph (13), the converted policy provides both basic hospital or surgical coverage and major medical coverage, the value of such basic benefits.
If the maximum benefit is determined by clause (A)(ii) of this paragraph, the insurer may require that the deductible be satisfied during a period of not less than three months if the deductible is $100 or less, and not less than six months if the deductible exceeds $100.
(D) The benefit period shall be each calendar year when the maximum benefit is determined by clause (A)(i) of this paragraph or 24 months when the maximum benefit is determined by clause (A)(ii) of this paragraph.
(E) The term "covered medical expenses," as used above, shall include at least, in the case of hospital room and board charges 80% of the average semiprivate room and board rate for the hospital in which the individual is confined and twice such amount for charges in an intensive care unit. Any surgical schedule shall be consistent with those customarily offered by the insurer under group or individual health insurance policies and must provide at least a $1,200 maximum benefit.
(12) The conversion privilege required by this act shall, if the group insurance policy insures the employee or member for basic hospital or surgical expense insurance as well as major medical expense insurance, make available the plans of benefits set forth in paragraph (11). At the option of the insurer, such plans of benefits may be provided under one policy.
The insurer may also, in lieu of the plans of benefits set forth in paragraph (11), provide a policy of comprehensive medical expense benefits without first dollar coverage. The policy shall conform to the requirements of paragraph (11). An insurer electing to provide such a policy shall make available a low deductible option, not to exceed $100, a high deductible option between $500 and $1,000, and a third deductible option midway between the high and low deductible options.
(13) The insurer, at its option, may also offer alternative plans for group health conversion in addition to those required by this act.
(14) In the event coverage would be continued under the group policy on an employee following the employee's retirement prior to the time the employee is or could be covered by medicare, the employee may elect, in lieu of such continuation of group insurance, to have the same conversion rights as would apply had such person's insurance terminated at retirement by reason of termination of employment or membership.
(15) The converted policy may provide for reduction of coverage on any person upon such person's eligibility for coverage under medicare (title XVIII of the United States social security act as added by the social security amendments of 1965 or as later amended or superseded) or under any other state or federal law providing for benefits similar to those provided by the converted policy.
(16) Subject to the conditions set forth above, the continuation and conversion privileges shall also be available:
(A) To the surviving spouse, if any, at the death of the employee or member, with respect to the spouse and such children whose coverage under the group policy terminates by reason of such death, otherwise to each surviving child whose coverage under the group policy terminates by reason of such death, or, if the group policy provides for continuation of dependents' coverage following the employee's or member's death, at the end of such continuation;
(B) to the spouse of the employee or member upon termination of coverage of the spouse, while the employee or member remains insured under the group policy, by reason of ceasing to be a qualified family member under the group policy, with respect to the spouse and such children whose coverage under the group policy terminates at the same time; or
(C) to a child solely with respect to such child upon termination of such coverage by reason of ceasing to be a qualified family member under the group policy, if a conversion privilege is not otherwise provided above with respect to such termination.
(17) The insurer may elect to provide group insurance coverage which complies with this act in lieu of the issuance of a converted individual policy.
(18) A notification of the conversion privilege shall be included in each certificate of coverage.
(19) A converted policy which is delivered outside this state must be on a form which could be delivered in such other jurisdiction as a converted policy had the group policy been issued in that jurisdiction.
(20) The insurer shall give the employee or member and such employee's or member's covered dependents: (A) Reasonable notice of the right to convert at least once during the eighteen-month continuation period; or (B) for persons covered under 29 U.S.C. 1161 et seq., notice of the right to a conversion policy required by this subsection (d) shall be given at least 30 days prior to the end of the continuation period provided by 29 U.S.C. 1161 et seq. or from the date the employer ceases to provide any similar group health plan to any employee. Such notices shall be provided in accordance with rules and regulations adopted by the commissioner of insurance.
(k) (1) No policy issued by an insurer to which this section applies shall contain a provision which excludes, limits or otherwise restricts coverage because medicaid benefits as permitted by title XIX of the social security act of 1965 are or may be available for the same accident or illness.
(2) Violation of this subsection shall be subject to the penalties prescribed by K.S.A. 40-2407 and 40-2411, and amendments thereto.
(l) The commissioner is hereby authorized to adopt such rules and regulations as may be necessary to carry out the provisions of this section.
History: L. 1951, ch. 296, § 9; L. 1965, ch. 306, § 1; L. 1967, ch. 273, § 1; L. 1977, ch. 162, § 1; L. 1978, ch. 181, § 1; L. 1980, ch. 138, § 1; L. 1981, ch. 195, § 1; L. 1984, ch. 172, § 4; L. 1987, ch. 169, § 2; L. 1988, ch. 160, § 1; L. 1991, ch. 134, § 1; L. 1992, ch. 196, § 2; L. 1993, ch. 132, § 7; L. 1994, ch. 81, § 1; L. 1994, ch. 355, § 3; L. 1996, ch. 182, § 6; L. 1997, ch. 190, § 1; L. 1998, ch. 174, § 5; L. 1999, ch. 15, § 1; L. 2004, ch. 159, § 11; L. 2008, ch. 164, § 5; L. 2009, ch. 136, § 10; July 1.
History: L. 1978, ch. 181, § 4; Nov. 1.
History: L. 1992, ch. 200, § 1; July 1.
History: L. 1992, ch. 200, § 2; July 1.
(a) "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 K.S.A. 40-2209h and amendments thereto, 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.
(b) "Approved service area" means a geographical area, as approved by the commissioner to transact insurance in this state, within which the carrier is authorized to provide coverage.
(c) "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 the 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.
(d) "Carrier" or "small employer carrier" means any insurance company, nonprofit medical and hospital service corporation, nonprofit optometric, dental, and pharmacy service corporations, municipal group-funded pool, fraternal benefit society or health maintenance organization, as these terms are defined by the Kansas Statutes Annotated, that offers health benefit plans covering eligible employees of one or more small employers in this state.
(e) "Case characteristics" means, with respect to a small employer, the geographic area in which the employees reside; the age and sex of the individual employees and their dependents; the appropriate industry classification as determined by the carrier, and the number of employees and dependents and such other objective criteria as may be approved family composition by the commissioner. "Case characteristics" shall not include claim experience, health status and duration of coverage since issue.
(f) "Class of business" means all or a separate grouping of small employers established pursuant to K.S.A. 40-2209g and amendments thereto.
(g) "Commissioner" means the commissioner of insurance.
(h) "Department" means the insurance department.
(i) "Dependent" means the spouse or child of an eligible employee, subject to applicable terms of the health benefits plan covering such employee and the dependent eligibility standards established by the board.
(j) "Eligible employee" means an employee who works on a full-time basis, with a normal work week of 30 or more hours, and includes a sole proprietor, a partner of a partnership or an independent contractor, provided such sole proprietor, partner or independent contractor is included as an employee under a health benefit plan of a small employer but does not include an employee who works on a part-time, temporary or substitute basis.
(k) "Financially impaired" means a member which, after the effective date of this act, is not insolvent but is:
(1) Deemed by the commissioner to be in a hazardous financial condition pursuant to K.S.A. 40-222d and amendments thereto; or
(2) placed under an order of rehabilitation or conservation by a court of competent jurisdiction.
(l) "Health benefit plan" means any hospital or medical expense policy, health, hospital or medical service corporation contract, and a plan provided by a municipal group-funded pool, or a health maintenance organization contract offered by an employer or any certificate issued under any such policies, contracts or plans. Health benefit plan also includes a cafeteria plan authorized by 26 U.S.C. Section 125 which offers the option of receiving health insurance coverage through a high deductible health plan and the establishment of a health savings account. In order for an eligible individual to obtain a high deductible health plan through the cafeteria plan, such individual shall present evidence to the employer that such individual has established a health savings account in compliance with 26 U.S.C. Section 223, and any amendments and regulations. "Health benefit plan" does not include policies or certificates covering only accident, credit, dental, disability income, long-term care, hospital indemnity, medicare supplement, specified disease, vision care, coverage issued as a supplement to liability insurance, insurance arising out of a workers compensation or similar law, automobile medical-payment insurance, or insurance under which benefits are payable with or without regard to fault and which is statutorily required to be contained in any liability insurance policy or equivalent self-insurance.
(m) "Health savings account" shall have the same meaning ascribed to it as in subsection (d) of 26 U.S.C. Section 223.
(n) "High deductible health plan" shall mean a policy or contract of health insurance or health care plan that meets the criteria established in subsection (c) of 26 U.S.C. Section 223 and any regulations promulgated thereunder.
(o) "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.
(p) "Initial enrollment period" means the period of time specified in the health benefit plan during which an individual is first eligible to enroll in a small employer health benefit plan. Such period shall be no less favorable than a period beginning on the employee's or member's date of initial eligibility and ending 31 days thereafter.
(q) "Late enrollee" means an eligible employee or dependent who requests enrollment in a small employer's health benefit plan following the initial enrollment period provided under the terms of the first plan for which such employee or dependent was eligible through such small employer, however an eligible employee or dependent shall not be considered a late enrollee if:
(1) The individual:
(A) Was covered under another employer-provided health benefit plan or was covered under section 607(1) of the employee retirement income security act of 1974 (ERISA) at the time the individual was eligible to enroll;
(B) states in writing, at the time of the initial eligibility, that coverage under another employer health benefit plan was the reason for declining enrollment but only if the group policyholder or the accident and sickness issuer required such a written statement and provided the individual with notice of the requirement for a written statement and the consequences of such written statement;
(C) has lost coverage under another employer health benefit plan or under section 607(1) of the employee retirement income security act of 1974 (ERISA) as a result of the termination of employment, reduction in the number of hours of employment, termination of employer contributions toward such coverage, the termination of the other plan's coverage, death of a spouse, or divorce or legal separation; and
(D) requests enrollment within 63 days after the termination of coverage under another employer health benefit plan; or
(2) the individual is employed by an employer who offers multiple health benefit plans and the individual elects a different health benefit plan during an open enrollment period; or
(3) a court has ordered coverage to be provided for a spouse or minor child under a covered employee's plan.
(r) "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.
(s) "Preexisting conditions exclusion" means a policy provision which excludes or limits coverage for charges or expenses incurred during a specified period not to exceed 90 days following the insured's effective date of enrollment as to a condition, whether physical or mental, regardless of the cause of the condition for which medical advice, diagnosis, care or treatment was recommended or received in the six months immediately preceding the effective date of enrollment.
(t) "Premium" means moneys paid by a small employer or eligible employees or both as a condition of receiving coverage from a small employer carrier, including any fees or other contributions associated with the health benefit plan.
(u) "Rating period" means the calendar period for which premium rates established by a small employer carrier are assumed to be in effect but any period of less than one year shall be considered as a full year.
(v) "Waiting period" means a period of time after full-time employment begins before an employee is first eligible to enroll in any applicable health benefit plan offered by the small employer.
(w) "Small employer" means any person, firm, corporation, partnership or association eligible for group sickness and accident insurance pursuant to subsection (a) of K.S.A. 40-2209 and amendments thereto actively engaged in business whose total employed work force consisted of, on at least 50% of its working days during the preceding year, of at least two and no more than 50 eligible employees, the majority of whom were employed within the state. 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 state taxation, shall be considered one employer. Except as otherwise specifically provided, provisions of this act which apply to a small employer which has a health benefit plan shall continue to apply until the plan anniversary following the date the employer no longer meets the requirements of this definition.
(x) "Affiliate" or "affiliated" means an entity or person who directly or indirectly through one or more intermediaries, controls or is controlled by, or is under common control with, a specified entity or person.
History: L. 1992, ch. 200, § 3; L. 1994, ch. 355, § 4; L. 1996, ch. 182, § 7; L. 1997, ch. 190, § 2; L. 1998, ch. 174, § 6; L. 2008, ch. 164, § 6; July 1.
(1) Any portion of the premium is paid by a small employer, or any covered individual, whether through wage adjustments, reimbursement, withholding or otherwise;
(2) the health benefit plan is treated by the employer or any of the covered individuals as part of a plan or program for the purposes of section 106 or section 162 of the United States internal revenue code; or
(3) with the permission of the board, the carrier elects to renew or continue a health benefit plan covering employees of an employer who no longer meets the definition of a "small employer."
(b) For purposes of this act an aggregation of two or more small employers covered under a trust arrangement or a policy issued to an association of small employers pursuant to K.S.A. 40-2209 and amendments thereto shall permit employee or member units of more than two but less than 51 employees or members and their dependents to participate in any health benefit plan to which this act applies. Any group which includes employee or member units of 50 or fewer employees shall be subject to the provisions of this act notwithstanding its inclusion of employee or member units with more than 50 employees or members.
(c) Except as expressly provided in this act, no health benefit plan offered to a small employer shall be subject to:
(1) Any law that would inhibit any carrier from contracting with providers or groups of providers with respect to health care services or benefits;
(2) any law that would impose any restriction on the ability to negotiate with providers regarding the level or method of reimbursing care or services provided under the health benefit plan.
(d) Individual policies of accident and sickness insurance issued to individuals and their dependents totally independent of any group, association or trust arrangement permitted under K.S.A. 40-2209 and amendments thereto shall not be subject to the provisions of this act.
History: L. 1992, ch. 200, § 4; L. 1994, ch. 355, § 5; L. 1998, ch. 174, § 7; July 1.
(a) Such policy may impose a preexisting conditions exclusion, not to exceed 90 days following the date of enrollment, for conditions whether physical or mental, regardless of the cause of the condition for which medical advice, diagnosis, care or treatment was recommended or received in the six months prior to the effective date of enrollment. Any preexisting conditions exclusion shall run concurrently with any waiting period.
(b) Such policy shall waive such a preexisting conditions exclusion to the extent the employee or member or individual dependent or family member was covered by (1) a group or individual sickness and accident policy, (2) coverage under section 607(1) of the employees retirement income security act of 1974 (ERISA), (3) a group specified in K.S.A. 40-2222 and amendments thereto (4) part A or part B of title XVIII of the social security act, (5) title XIX of the social security act, other than coverage consisting solely of benefits under section 1928, (6) chapter 55 of title 10 United States code, (7) a state children's health insurance program established pursuant to title XXI of the social security act, (8) medical care program of the indian health service or of a tribal organization, (9) the Kansas uninsurable health plan act pursuant to K.S.A. 40-2217 et seq. and amendments thereto or similar health benefits risk pool of another state, (10) a health plan offered under chapter 89 of title 5, United States code, (11) a health benefit plan under section 5(e) of the peace corps act (22 U.S.C. 2504 (e) or (12) a group subject to K.S.A. 12-2616 et seq. and amendments thereto which provided hospital, medical and surgical expense benefits within 63 days prior to the effective date of coverage under a health benefit plan with no gap in coverage. A group policy shall credit the periods of prior coverage specified in this subsection without regard to the specific benefits covered during the period of prior coverage. Any period that the employee or member is in a waiting period for any coverage under a group health plan or is in an affiliation period shall be taken into account in determining the continuous period under this subsection.
(c) A carrier may exclude a late enrollee except during an open enrollment period.
(d) Except as expressly provided by this act, every carrier doing business in the small employer market retains the authority to underwrite and rate individual accident and sickness insurance policies, and to rate small employer groups using generally accepted actuarial practices.
(e) No health benefit plan issued by a carrier may limit or exclude, by use of a rider or amendment applicable to a specific individual, coverage by type of illness, treatment, medical condition or accident, except for preexisting conditions as permitted under subsection (a).
(f) In the absence of the small employer's decision to the contrary, all health benefit plans shall make coverage available to all the eligible employees of a small employer without a waiting period. The decision of whether to impose a waiting period for eligible employees of a small employer shall be made by the small employer, who may only choose from the waiting periods offered by the carrier. No waiting period shall be greater than 90 days and shall permit coverage to become effective no later than the first day of the month immediately following completion of the waiting period.
(g) (1) Except as provided in subsection (f), requirements used by a small employer carrier in determining whether to provide coverage to a small employer, including requirements for minimum participation of eligible employees and minimum employer contributions, shall be applied uniformly among all small employers with the same number of eligible employees applying for coverage or receiving coverage from the small employer carrier.
(2) 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.
(3) (A) Except as provided in provision (B), in applying minimum participation requirements with respect to a small employer, a small employer carrier shall not consider employees or dependents who have qualifying existing coverage in a health benefit plan sponsored by another employer in determining whether the applicable percentage of participation is met.
(B) With respect to a small employer, a small employer carrier may consider employees or dependents who have coverage under another health benefit plan sponsored by such small employer in applying minimum participation requirements.
(h) For the purposes of this section, the term "preexisting conditions exclusion" shall mean, with respect to coverage, a limitation or exclusion of benefits relating to a condition based on the fact that the condition was present before the date of enrollment for such coverage whether or not any medical advice, diagnosis, care or treatment was recommended or received before such date.
(i) For the purposes of this section, the term "date of enrollment" means the date the individual is enrolled under the group policy or, if earlier, the first day of the waiting period for such enrollment.
(j) For the purposes of this section, the term "waiting period" means with respect to a group policy the period which must pass before the individual is eligible to be covered for benefits under the terms of the policy.
History: L. 1992, ch. 200, § 5; L. 1994, ch. 355, § 6; L. 1997, ch. 190, § 3; L. 1998, ch. 174, § 8; L. 2000, ch. 34, § 2; July 1.
(1) The small employer carrier uses more than one type of system for the marketing and sale of health benefit plans to small employers;
(2) the small employer carrier has acquired a class of business from another small employer carrier; or
(3) the small employer carrier provides coverage to one or more association groups that meet the requirements of subsection (f)(5) of K.S.A. 40-2209 and amendments thereto.
(b) A small employer carrier may establish up to nine separate classes of business under subsection (a).
(c) The commissioner may adopt rules and regulations to provide for a period of transition in order for a small employer carrier to come into compliance with subsection (b) in the instance of acquisition of an additional class of business from another small employer carrier.
(d) The commissioner may approve the establishment of additional classes of business 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.
History: L. 1992, ch. 200, § 6; L. 1998, ch. 174, § 9; July 1.
(1) 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 20%.
(2) 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 that could be charged to such employers under the rating system for that class of business, shall not vary from the index rate by more than 25% of the index rate.
(3) The percentage increase in the premium rate charged to a small employer for a new rating period may 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 the small employer carrier is no longer enrolling new small employers, the small employer carrier shall use the percentage change in the base premium rate, if such 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 small employer carrier is actively enrolling new small employers;
(B) any adjustment, not to exceed 15% annually and adjusted pro rata for rating periods of less than one 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.
(4) Adjustments in rates for claim experience, health status and duration of coverage 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.
(5) A small employer carrier may utilize industry as a case characteristic in establishing premium rates, if the highest rate factor associated with any industry classification does not exceed the lowest rate factor associated with any industry classification by more than 30% for each year until the earlier of the first acquisition of coverage from a small employer carrier which did not previously provide coverage to that small employer or the first renewal date on or after December 31, 1996, and 15% each year thereafter.
(6) A premium rate for a rating period may exceed the ranges set forth in paragraphs (1) and (2) until the earlier of the first acquisition of coverage from a small employer carrier which did not previously provide coverage to that small employer or the first renewal date on or after December 31, 1996. If premium rates for a small employer covered by a small employer carrier prior to January 1, 1993, are below the lowest range as set forth in paragraphs (1) and (2), such small employer carrier must at least increase that small employer's rates commencing with renewals on or after December 31, 1995, to equally distribute the needed increase to get that small employer's rates within the range over the renewal opportunities remaining so that the small employer's renewal rates on or after December 31, 1999, would be within the ranges. In such case, 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 the small employer carrier is no longer enrolling new small employers, the small employer carrier shall use the percentage change in the base premium rate, if such 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 small employer carrier is actively enrolling new small employers.
(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.
(7) (A) Small employer carriers shall apply rating factors, including case characteristics, consistently with respect to all small employers in a class of business. Rating factors shall produce premiums for identical groups which differ only by amounts attributable to plan design and do not reflect differences due to the nature of the groups assumed to select particular health benefit plans.
(B) A small employer carrier shall treat all health benefit plans issued or renewed in a class of business in the same calendar month as having the same rating period.
(8) For the purposes of this subsection, a health benefit plan that utilizes a restricted provider network shall not be considered similar coverage to a health benefit plan that does not utilize such a network, if utilization of the restricted provider network results in substantial differences in claims costs.
(9) A 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.
(10) The commissioner may establish 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:
(A) Assuring that differences in rates charged for health benefit plans by small employer carriers are reasonable and reflect objective differences in plan design, not including differences due to the nature of the groups assumed to select particular health benefit plans; and
(B) prescribing 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 such 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.
(c) The commissioner may suspend for a specified period the application of subsection (a)(1) as to the premium rates applicable to one or more small employers included within a class of business of a small employer carrier for one 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 the 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) Upon written application of the group policyholders, the commissioner may suspend the application of K.S.A. 40-2209g and 40-2209h and amendments thereto to any group whose fundamental structure or composition would otherwise be adversely affected.
History: L. 1992, ch. 200, § 7; L. 1994, ch. 355, § 7; L. 1995, ch. 183, § 8; July 1.
(a) The extent to which premium rates for a specific 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 such small employer;
(b) the provisions concerning such carrier's right to change premium rates and the factors other than claims experience which affect changes in premium rates; and
(c) provisions relating to renewability of policies and contracts; and
(d) the provision relating to any pre-existing condition provision.
History: L. 1992, ch. 200, § 8; July 1.
(a) Comply with accepted actuarial practices;
(b) are uniformly applied to health benefit plans covering small employers; and
(c) comply with the provisions of this act.
History: L. 1992, ch. 200, § 9; July 1.
History: L. 1992, ch. 200, §§ 10, 11; Repealed, L. 1998, ch. 174, § 33; July 1.
(b) (1) Except as provided in paragraph (2), no small employer carrier, agent or broker shall, directly or indirectly, engage in the following activities:
(A) Encouraging or directing small employers to refrain from filing an application for coverage with the small employer carrier because of the health status, claims experience, industry, occupation or geographic location of the small employer;
(B) encouraging or directing small employers to seek coverage from another carrier because of the health status, claims experience, industry, occupation or geographic location of the small employer.
(2) The provisions of paragraph (1) shall not apply with respect to information provided by a small employer carrier or producer to a small employer regarding the established geographic service area or a restricted network provision of a small employer carrier.
(c) (1) Except as provided in paragraph (2), no small employer carrier shall, directly or indirectly, enter into any contract, agreement or arrangement with an agent or broker that provides for or results in the compensation paid to such person for the sale of a health benefit plan to be varied because of the health status, claims experience, industry, occupation or geographic location of the small employer.
(2) Paragraph (1) shall not apply with respect to a compensation arrangement that provides compensation to an agent or broker on the basis of percentage of premium, provided that the percentage shall not vary because of the health status, claims experience, industry, occupation or geographic area of the small employer.
(d) No small employer carrier shall terminate, fail to renew or limit its contract or agreement of representation with an agent or broker for any reason related to the health status, claims experience, occupation, or geographic location of the small employers placed by the agent or broker with the small employer carrier.
(e) No small employer carrier, agent or broker shall induce or otherwise encourage a small employer to separate or otherwise exclude an employee from health coverage or benefits provided in connection with the employee's employment.
(f) Denial by a small employer carrier of an application for coverage from a small employer shall be in writing and shall state the reason or reasons for the denial.
(g) The commissioner may adopt rules and regulations setting forth additional standards to provide for the fair marketing and broad availability of health benefit plans to small employers in this state.
(h) If a small employer carrier enters into a contract, agreement or other arrangement with a third-party administrator to provide administrative, marketing or other services related to the offering of health benefit plans to small employers in this state, the third-party administrator shall be subject to this section as if it were a small employer carrier.
(i) Except as provided in paragraph (l) [(j)], for the purposes of this act, carriers that are affiliated companies or that are eligible to file a consolidated tax return shall be treated as one carrier and any restrictions or limitations imposed by this act shall apply as if all health benefit plans issued to small employers in this state by such affiliated carriers were issued by one carrier.
(j) An affiliated carrier that is a health maintenance organization having a certificate of authority under K.S.A. 40-3201 et seq. and amendments thereto, may be considered to be a separate carrier for the purpose of this act.
History: L. 1992, ch. 200, § 12; L. 1998, ch. 174, § 10; L. 2000, ch. 34, § 3; July 1.
History: L. 1992, ch. 200, § 13; July 1.
History: L. 1992, ch. 200, § 14; July 1.
(b) (1) In the case of an accident and health insurer that offers a policy providing hospital, medical or surgical expense benefits to a small employer through a medical service enrollment area the accident and health insurer may:
(A) Limit the small employers that may apply for such coverage to those with eligible employees or dependents who live, work or reside in the medical service enrollment area for such policy; and
(B) within the medical service enrollment area of such policy, deny coverage to such small employer if the accident and sickness insurer has demonstrated to the commissioner that: (i) It will not have the capacity to deliver services adequately to small employees and dependents of any additional small employers because of its obligations to existing small employer group policyholders or certificateholders and to eligible employees and dependents; and (ii) it will apply this paragraph uniformly to all small employers without regard to the claims experience of those small employers and their employees and dependents and without regard to the health status factors of any employees or dependents.
(2) An accident and sickness insurer which denies coverage to a small employer under any policy providing hospital, medical or surgical expense benefits in any medical service enrollment area in accordance with subsection (b)(1)(B) may not offer such policies to small employers within such medical service enrollment area for a period of 180 days after coverage is denied.
(c) (1) An accident and sickness insurer may deny coverage to a small employer under a policy providing hospital, medical or surgical expense benefits if the accident and sickness insurer has demonstrated to the commissioner that:
(A) It does not have the financial reserves necessary to underwrite additional coverage; and
(B) it is applying this paragraph uniformly to all small employers in this state without regard to the claims experience of the small employers and their employees and dependents and without regard to any health status factors of any employees or dependents.
(2) An accident and health insurer upon denying coverage to small employers under policies providing hospital, medical or surgical expense benefits in accordance with subsection (c)(1) may not offer any policies providing hospital, medical or surgical expense benefits to any small employer for a period of 180 days after the date such policies are denied or until the accident and health insurer has demonstrated to the commissioner that it has sufficient financial reserves to underwrite additional coverage, whichever is later.
(d) The requirements of subsection (a) shall not be construed to preclude an accident and health insurer from establishing employer contribution rules or group participation rules for the offering of policies providing hospital, medical or surgical expense benefits to small employers.
(e) The requirements of subsection (a) shall not apply to small employer group policies offered by an accident and health insurer if such coverage is made available only through one or more associations.
(f) As used in this subsection the following mean:
(1) "Dependent" means those persons as defined in subsection (k) of K.S.A. 40-2209d and amendments thereto;
(2) "employee" means those persons as defined in subsection (1) of K.S.A. 40-2209d and amendments thereto;
(3) "employer contribution rule" means a requirement relating to the minimum level or amount of employer contribution toward the premium for enrollment of employees and dependents;
(4) "group participation rule" means a requirement relating to the minimum number of employees and dependents that must be enrolled in relation to a specified percentage or number of eligible employees or dependents;
(5) "health status related factors" means: (A) a physical or mental illness medical condition, (B) claims experience, (C) receipt of health care, (D) medical history, (E) genetic information, (F) evidence of insurability including conditions arising out of acts of domestic violence and (H) disability; and
(6) "small employer" means those employers as defined by subsection (z) of K.S.A. 40-2209d and amendments thereto.
History: L. 1997, ch. 190, § 6; July 1.
(2) Under a policy or contract issued to a college, school or other institutions of learning, a school district or districts, or school jurisdictional unit, or to the head, or principal; or governing board of any such educational unit, who or which shall be deemed the policyholder, covering students, teachers or other employees.
(3) Under a policy or contract issued to any volunteer fire department, first aid, civil defense, or other such volunteer organization, which shall be deemed the policyholder, covering all the members of such department or group, defined by reference to specified hazards incident to an activity or activities or operations sponsored or supervised by such policyholder.
(4) Under a policy or contract issued to a sports team, camp or sponsor thereof, which shall be deemed the policyholder, covering ten (10) or more members, campers, employees, officials or supervisors.
(5) Under a policy or contract issued to an employer, who shall be 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.
(6) Under a policy or contract issued to any religious, charitable, recreational, educational, or civic organization, or branch thereof, which shall be deemed the policyholder, covering any group of members or participants defined by reference to specified hazards incident to an activity or activities or operations sponsored or supervised by such policyholder.
(7) Under a policy or contract issued to a newspaper or other publisher, which shall be deemed the policyholder, covering its carriers.
(8) Under a policy or contract issued to any other type of group which the commissioner of insurance may find properly subject to the issuance of blanket sickness and accident policy or contract.
(B) Every such blanket policy shall contain provisions which in the opinion of the commissioner are not less favorable to the policyholder and the individual insured than the following:
(1) A provision that the policy, including endorsements and a copy of the application, if any, of the policyholder and the persons insured shall constitute the entire contract between the parties, and that any statement made by the policyholder or by a person insured shall in absence of fraud, be deemed a representation and not a warranty, and that no such statements shall be used in defense to a claim under the policy, unless contained in a written application. Such person, his or her beneficiary, or assignee, shall have the right to make written request to the insurer for a copy of such application and the insurer shall, within fifteen (15) days after the receipt of such request at its home office or any branch office of the insurer, deliver or mail to the person making such request a copy of such application. If such copy shall not be so delivered or mailed, the insurer shall be precluded from introducing such application as evidence in any action based upon or involving any statements contained therein.
(2) A provision that written notice of sickness or of injury must be given to the insurer within twenty (20) days after the date when such a sickness or injury occurred. Failure to give notice within such time shall not invalidate nor reduce any claim if it shall be shown not to have been reasonably possible to give such notice and that notice was given as was reasonably possible.
(3) A provision that the insurer will furnish either to the claimant or to the policyholder for delivery to the claimant such forms as are usually furnished by it for filing proof of loss. If such forms are not furnished before the expiration of fifteen (15) days after giving of such notice, the claimant shall be 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.
(4) A provision that in the case of claim for loss of time for disability, written proof of such loss must be furnished to the insurer within ninety (90) days after the commencement of the period for which the insurer is liable, and that subsequent written proofs of the continuance of such disability must be furnished to the insurer at such intervals as the insurer may reasonably require, and that in the case of claim for any other loss, written proof of such loss must be furnished to the insurer within ninety (90) days after the date of such loss. Failure to furnish such proof within such time shall not invalidate nor reduce any claim if it shall be shown not to have been reasonably possible to furnish such proof and that such proof was furnished as soon as was reasonably possible.
(5) A provision that all benefits payable under the policy other than benefits for loss of time will be payable immediately upon receipt of due written proof of such loss, and that, subject to due proof of loss, all accrued benefits payable under the policy for loss of time will be paid not less frequently than monthly during the continuance of the period for which the insurer is liable, and that any balance remaining unpaid at the termination of such period will be paid immediately upon receipt of such proof.
(6) A provision that the insurer at its own expense, shall have the right and opportunity to examine the person of the insured when and so often as it may reasonably require during the pendency of claim under the policy and also the right and opportunity to make an autopsy where it is not prohibited by law.
(7) A provision that 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 has been furnished in accordance with the requirements of the policy and that no action shall be brought after the expiration of five (5) years after the time written proof of loss is required to be furnished.
(C) Each person insured under such blanket sickness and accident policy or contract shall, except where authorization is otherwise given by the commissioner of insurance, be furnished a memorandum approved by the commissioner of insurance setting forth the essential coverages of the contract, including the conditions under which an individual's coverage may be terminated under the policy and the age, if any, to which the coverage shall be limited, reduced, or restricted; the procedure to be followed in making claim under the policy; and, to whom benefits under the policy are payable. Such certificates shall also contain a summary of the provisions set forth in (B) of this subsection.
(D) All benefits under any blanket sickness and accident policy shall be payable to the person insured, or to his or her designated beneficiary or beneficiaries, or to his or her estate, except that if the person insured be a minor, such benefits may be made payable to his or her parents, guardian, or other person actually supporting him or her.
(E) No blanket disability income policy which integrates benefits with social security benefits, shall provide that the amount of any disability benefit actually being paid to the disabled person shall be reduced by changes in the level of social security benefits resulting either from changes in the social security law or due to cost of living adjustments which become effective after the first day for which disability benefits become payable.
History: L. 1951, ch. 296, § 10; L. 1965, ch. 306, § 2; L. 1977, ch. 162, § 2; July 1.
History: L. 1951, ch. 296, § 11; June 30.
History: L. 1951, ch. 296, § 12; June 30.
History: L. 1951, ch. 296, § 13; June 30.
History: L. 1951, ch. 296, § 15; Repealed, L. 1997, ch. 24, § 7; July 1.
(b) No group or blanket policy or certificate of accident and sickness insurance providing hospital, medical or surgical expense benefits shall be issued or delivered to any person in this state, nor shall any application, rider or endorsement be used in connection therewith, until a copy of the form thereof and of the classification of risks and the premium rates pertaining thereto has been filed with the commissioner of insurance.
(c) (1) No such policy shall be issued, nor shall any application, rider or endorsement be used in connection therewith, until the expiration of 30 days after it has been filed unless the commissioner gives written approval thereof.
(2) (A) The commissioner shall create a requirements document containing filing requirements for each type of insurance. Such requirements document shall contain a list of all product filing requirements for each type of insurance that is required to be filed. For each type of insurance, such requirements document shall contain an appropriate citation to each requirement contained in any statute, rule and regulation and published bulletins in this state having the force and effect of law. Such requirements document shall be available on the insurance department internet website.
(B) The commissioner shall update the requirements document referred to in subparagraph (A) no less frequently than annually. The commissioner shall update the requirements document referred to in subparagraph (A) within 30 days after the effective date of any change in law, rule and regulation or bulletin published by the commissioner having the force and effect of law in this state.
(3) A filer shall submit with each policy form filing a document indicating the location within the policy form or any supplemental document for information establishing compliance with each requirement contained in the requirements documents referenced in subparagraph (A) of paragraph (2) of this subsection. A filer shall certify that the policy form, including any accompanying supplemental document, meets all requirements of state law.
(d) (1) Any risk classifications, premium rates, rating formulae, and all modifications thereof applicable to Kansas residents shall not establish an unreasonable, excessive or unfairly discriminatory rate or, with respect to group or blanket sickness and accident policies providing hospital, medical or surgical expense benefits issued pursuant to K.S.A. 40-2209 or 40-2210, and amendments thereto, discriminate against any individuals eligible for participation in a group, or establish rating classifications within a group that are based on medical conditions. In no event shall the rates charged to any group to which this subsection applies increase by more than 75% during any annual period unless the insurer can clearly document a material and significant change in the risk characteristics of the group.
(2) All rates for sickness and accident insurance providing hospital, medical or surgical expense benefits covering Kansas residents shall be made in accordance with the following provisions and due consideration shall be given to:
(A) Past and prospective loss experience;
(B) past and prospective expenses;
(C) adequate contingency reserves; and
(D) all other relevant factors within and without the state.
(3) Nothing in this act is intended to prohibit or discourage reasonable competition or discourage or prohibit uniformity of rates except to the extent necessary to accomplish the aforementioned purpose. The commissioner is hereby authorized to issue such rules and regulations as are necessary and not inconsistent with this act.
(e) All parties in the filing process shall act in good faith and with due diligence in performance of their duties pursuant to this section.
(f) (1) Within 30 days of receipt of the initial filing, the commissioner shall review and approve such filing or provide notice of any deficiency or disapprove the initial filing. Any notice of deficiency or disapproval shall be in writing and based only on the specific provisions of applicable statutes, regulations or bulletins published by the commissioner having the force and effect of law in this state and contained in the requirements document created by the commissioner pursuant to subparagraph (A) of paragraph (2) of subsection (c). The notice of deficiency or disapproval shall provide specific reasons for notice of deficiencies or disapproval. Such reasons shall contain sufficient detail for the filer to bring the policy form into compliance, and shall cite each specific statute, rule and regulation or bulletin having the force and effect of law in this state upon which the notice of deficiency or disapproval is based. Any notice of disapproval provided by the commissioner shall state that a hearing will be granted within 20 days after receipt of a written request therefor by the insurer. At the end of the 30 day period, the policy form shall be deemed approved if the commissioner has taken no action.
(2) In addition to the statutes, regulations or bulletins described in paragraph (2) of subsection (c), the commissioner may disapprove a filing or provide a notice of deficiency for any form for which the commissioner determines that the benefits provided therein are unreasonable in relation to the premium charged; or if such form contains any provisions which are unjust, unfair, inequitable, misleading, deceptive or encourage misrepresentation of such policy. Any notice of disapproval provided by the commissioner pursuant to this paragraph shall state that a hearing will be granted within 20 days after receipt of a written request therefor by the insurer.
(3) If the insurer has received a disapproval or notice of deficiency or disapproval regarding a policy form, it shall be unlawful for an insurer to issue such policy form or use such policy form in connection with any policy until that policy form has received a later approval by the commissioner.
(4) Within 30 days of receipt of the commissioner's notice of deficiency or disapproval, a filer may resubmit a policy form that corrects any deficiencies or resubmit a disapproved policy form and a revised certification. Any policy form not resubmitted to the commissioner within 30 days of the notice of deficiency shall be deemed withdrawn. Any disapproved policy form not resubmitted to the commissioner within 30 days of the notice of disapproval shall be deemed disapproved.
(5) (A) Within 30 days of receipt of a resubmitted filing and certification, the commissioner shall review the resubmitted filing and certification, and shall approve or disapprove such resubmitted filing and certification. Any notice of disapproval pertaining to the resubmitted filing and certification shall be in writing and provide a detailed description of the reasons for the disapproval in sufficient detail for the filer to bring the policy form into compliance. The notice of disapproval shall cite each specific statute, rule and regulation or bulletin having the force and effect of law in this state upon which the disapproval is based. No further extension of time may be taken unless the filer has introduced new provisions in the resubmitted filing and certification or the filer has materially modified any substantive provisions of the policy form, in which case the commissioner may extend the time for review by an additional 30 days. At the end of this 30 day review period, the policy form shall be deemed approved if the commissioner has taken no action.
(B) (i) Subject to clause (ii) of this subparagraph, the commissioner may not disapprove a resubmitted policy form for reasons other than those initially set forth in the original notice of deficiencies or disapproval sent pursuant to paragraph (1) of this subsection.
(ii) The commissioner may disapprove a resubmitted policy form for reasons other than those initially set forth in the original notice of deficiencies or disapproval sent pursuant to this subsection if:
(a) The filer has introduced new provisions in the resubmitted policy form and certification;
(b) the filer has materially modified any substantive provisions of the policy form;
(c) there has been a change in any statute, rule and regulation or published bulletin in this state having the force and effect of law; or
(d) there has been reviewer error and the written disapproval fails to state a specific provision of applicable statute, regulation or bulletin published by the commissioner having the force and effect of law in this state that is necessary to have the policy form conform to the requirements of law.
(6) At the end of the review period, the policy form shall be deemed approved if the commissioner has taken no action.
(7) Notwithstanding any other provision in this section, the commissioner may return a grossly inadequate filing to the filer without triggering any of the time deadlines set forth in this section. For purposes of this paragraph, the term "grossly inadequate filing" means a filing that fails to provide key information, including state-specific information, regarding a product, policy or rate, or that demonstrates an insufficient understanding of what is required to comply with state statutes or regulations.
(g) Except in cases of a material error or omission in a policy form that has been approved or deemed approved pursuant to the provisions of this act, the commissioner shall not:
(1) Retroactively disapprove that filing; or
(2) with respect to those policy forms, examine the filer during a routine or targeted market conduct examination for compliance with any later-enacted policy form filing requirements.
(h) If a rate filing or marketing material is required to be filed or approved by state law for a specific policy form, the time frames for review, approval or disapproval, resubmission, and re-review of those rate filings or marketing materials shall be the same as those provided for in subsection (f) for the review of policy forms.
(i) For purposes of this section:
(1) "Accident and sickness carrier" means an entity licensed to offer accident and sickness insurance in this state, or subject to the insurance laws and regulations of this state, or subject to the jurisdiction of the commissioner, that contracts or offers to contract to provide, deliver, arrange for, pay for or reimburse any of the costs of health care services or any insurer that provides policies of supplemental, disability income, medicare supplement or long-term care insurance.
(2) "Commissioner" means the commissioner of insurance.
(3) "Health care services" means services for the diagnosis, prevention, treatment, cure or relief of a health condition, illness or disease.
(4) "Policy form" means any policy, contract, certificate, rider, endorsement, evidence of coverage of any amendments thereto that are required by law to be filed with the commissioner for approval prior to their sale or issuance for sale in this state.
(5) "Supplemental documents" means any documents required to be filed in support of policy forms that may or may not be subject to approval.
(6) "Type of insurance" means any hospital or medical expense policy, health, hospital or medical service corporation contract, and a plan provided by a municipal group-funded pool, or a health maintenance organization contract offered by an employer or any certificate issued under any such policies, contracts or plans, policies or certificates covering only accident, credit, dental, disability income, long-term care, hospital indemnity, medicare supplement, specified disease, vision care, coverage issued as a supplement to liability insurance.
(j) This section shall apply to any individual or group policy form issued by an accident and health carrier required to be filed with the commissioner for review or approval.
(k) Violations of subsection (d) shall be treated as violations of the unfair trade practices act and subject to the penalties prescribed by K.S.A. 40-2407 and 40-2411 and amendments thereto.
(l) Hearings under this section shall be conducted in accordance with the provisions of the Kansas administrative procedure act.
History: L. 1965, ch. 304, § 2; L. 1986, ch. 318, § 36; L. 1988, ch. 356, § 108; L. 1991, ch. 134, § 2; L. 2008, ch. 38, § 1; July 1.
History: L. 1976, ch. 218, § 1; July 1.
(a) The term "form" means policies, riders, endorsements, applications, subscriber contracts, or other documents required to be filed pursuant to K.S.A. 40-216 or 40-19a07 and amendments thereto.
(b) The term "accident and sickness insurance" means insurance written under K.S.A. 40-401, K.S.A. 40-1102(1)(a), other than credit insurance, and coverages written under K.S.A. 40-19a02 and amendments thereto. For purposes of this act nonprofit dental service corporations shall be deemed to be engaged in the business of insurance.
(c) The term "policy" means the entire contract between the insurer and the insured, including the policy, riders, endorsements, and the application if attached, and such term includes subscriber agreements issued by nonprofit dental service corporations.
History: L. 1976, ch. 218, § 2; L. 1997, ch. 8, § 8; July 1.
(1) Basic hospital expense coverage;
(2) basic medical-surgical expense coverage;
(3) hospital confinement indemnity coverage;
(4) major medical expense coverage;
(5) disability income protection coverage;
(6) accident only coverage; and
(7) specified disease or specified accident coverage.
(b) Nothing in this section shall preclude the issuance of any policy or contract which combines two (2) or more of the categories of coverage enumerated in paragraphs (1) through (6) of subsection (a).
(c) No policy or contract shall be delivered or issued for delivery in this state which does not meet the prescribed standards for the categories of coverage listed in paragraphs (1) through (7) of subsection (a) which are contained within the policy or contract unless the commissioner finds such policy or contract, including those affording supplemental coverage, will fulfill a reasonable public need and such policy or contract meets the requirements set forth in K.S.A. 40-2215 or unless the outline of coverage required by K.S.A. 40-2219 clearly sets forth wherein such policy does not provide the standards for benefits promulgated by the commissioner.
(d) The commissioner shall prescribe the method of identification of policies and contracts based upon coverages provided.
History: L. 1976, ch. 218, § 3; July 1.
(b) The commissioner shall prescribe the format and content of the outline of coverage required by subsection (a). "Format" means style, arrangement and overall appearance, including such items as the size, color, and prominence of type and the arrangement of text and captions. Such outline of coverage shall include:
(1) A statement identifying the applicable category or categories of coverage provided by the policy or contract as prescribed in K.S.A. 40-2218;
(2) a description of the principal benefits and coverage provided in the policy or contract;
(3) a statement of the exceptions, reductions and limitations contained in the policy or contract;
(4) a statement of the renewal provisions including any reservation by the insurer or non-profit hospital, medical, or dental service corporation of a right to change premiums;
(5) a statement that the outline is a summary of the policy or contract issued or applied for and that the policy or contract should be consulted to determine governing contractual provisions.
History: L. 1976, ch. 218, § 4; July 1.
History: L. 1976, ch. 218, § 5; July 1.
(b) may not condition the issuance or effectiveness of a medicare supplement policy issued to a person eligible for medicare by reason of disability because of the health status, claims experience, receipt of health care, or medical condition of such applicant if such applicant makes application for a medicare supplement policy during the six month period beginning with the first day of the month in which such applicant enrolls for benefits under medicare part B;
(c) shall make available to persons eligible for medicare by reason of disability each type of medicare supplement policy such issuer makes available to person eligible for medicare by reason of age; and
(d) shall not charge individuals who become eligible for medicare by reason of disability and who are under the age of 65 premium rates for any medical supplemental insurance benefit plan offered by the issuer that exceeds the issuer's premium rates charged for such plan to individuals who are age 65.
History: L. 1981, ch. 194, § 1; L. 1992, ch. 58, § 1; L. 1996, ch. 24, § 1; L. 1999, ch. 106, § 4; July 1.
(b) Medicare supplement policies of insurance, as defined by the commissioner of insurance by rules and regulations, shall be reinstated in the event of lapse if the insurer is provided proof of cognitive impairment or the loss of functional capacity within five months after termination and the insured requests such reinstatement. Collection of past due premium will be allowed, where appropriate. The standard of proof of cognitive impairment or loss of functional capacity shall be established by clinical diagnosis by a person licensed to practice medicine and surgery and qualified to make such diagnosis.
History: L. 1988, ch. 159, § 1; L. 1996, ch. 182, § 8; July 1.
(b) an insurance contract billed for by the insurer to the insured on a preauthorized check or bank draft basis; and
(c) an insurance contract for which the insurer has sent the proper notice as provided under this act more than twice in the preceding 12 months.
History: L. 1988, ch. 159, § 2; July 1.
(b) is a professional association of dentists incorporated in Kansas on July 3, 1972, which provides coverage for the payment of expenses described herein to or for the members of the association or dependents through a trust established November 1, 1985, and complies with K.S.A. 40-2222a;
(c) is a trade association of banks incorporated in Kansas on August 9, 1978, which provides coverage for the payment of expenses described herein to or for the members of the association or dependents through a trust established July 1, 1989, and complies with K.S.A. 40-2222a;
(d) is a trade association of truckers incorporated in Kansas on July 1, 1985, which provides coverage for the payment of expenses described herein to or for the members of the association or dependents through a trust established January 1, 1990, and complies with K.S.A. 40-2222a;
(e) is an association of physicians practicing in the Kansas City metropolitan area, incorporated in Missouri on March 5, 1891, and qualified as a foreign corporation in Kansas on May 19, 1987, which provides coverage for the payment of expenses described herein to or for the members of the association, their employees and dependents through a trust established November 1, 1984, and complies with K.S.A. 40-2222a;
(f) conclusively shows by submission of an appropriate certificate, license, letter or other document issued by the United States department of labor that such person or entity is not subject to Kansas law; or
(g) conclusively shows that it is subject to the jurisdiction of an agency of this state or the federal government. For purposes of this act, tax exempt status under section 501(c) of the federal internal revenue code of 1986 shall not be deemed to be jurisdiction of the federal government.
History: L. 1983, ch. 150, § 1; L. 1991, ch. 135, § 1; May 2.
(a) The coverage is not provided by an insurance company;
(b) the plan is not subject to the laws and regulations relating to insurance companies;
(c) the plan is not under the jurisdiction of the commissioner of insurance; and
(d) if the plan does not pay medical expenses that are eligible for payment under the plan for any reason, the individuals covered by the plan may be liable for such expenses.
History: L. 1991, ch. 135, § 2; May 2.
(b) Every association subject to taxation under the provisions of this section shall pay the tax imposed and make a return thereof under oath to the commissioner of insurance under such rules and regulations and in such form and manner as the commissioner may prescribe.
History: L. 1991, ch. 135, § 3; May 2.
History: L. 1983, ch. 150, § 2; July 1.
History: L. 1983, ch. 150, § 3; July 1.
History: L. 1987, ch. 156, § 1; Jan. 1, 1988.
History: L. 1987, ch. 156, § 2; Jan. 1, 1988.
(a) "Long-term care insurance" means any insurance policy primarily advertised, marketed, offered or designed to provide coverage for not less than 12 consecutive months for each covered person on an expense incurred, indemnity, prepaid, or other basis, for one or more necessary or diagnostic, preventive, therapeutic, rehabilitative, maintenance, custodial, residential or personal care services, provided in a setting other than an acute care unit of a hospital. Such term includes group and individual policies or riders whether issued by insurers, fraternal benefit societies, nonprofit medical and hospital service corporations, prepaid health plans, health maintenance organizations, or any similar organization. Long-term care insurance shall not include any insurance policy which is offered primarily to provide basic medicare supplement coverage, basic hospital expense coverage, basic medical-surgical expense coverage, hospital confinement indemnity coverage, major medical expense coverage, disability income protection coverage, accident-only coverage, specified disease or specified accident coverage, or limited benefit health coverage, but the inclusion or attachment of long-term care insurance coverage to one of the foregoing products shall not exempt it from the requirements of this act.
(b) "Applicant" means:
(1) In the case of an individual long-term care insurance policy, the person who seeks to contract for such benefits; and
(2) in the case of a group long-term care insurance policy, the proposed certificateholder.
(c) "Certificate" means any certificate issued under a group long-term care insurance policy, which policy has been delivered or issued for delivery in this state.
(d) "Commissioner" means the insurance commissioner of this state.
(e) "Group long-term care insurance" means a long-term care insurance policy delivered or issued for delivery in this state and issued to a group as defined in K.S.A. 40-2209, and amendments thereto. No group long-term care insurance coverage may be offered to a resident of this state under a group policy issued in another state to a group defined in K.S.A. 40-2209, and amendments thereto, unless this state, or another state having statutory and regulatory long-term care insurance requirements substantially similar to those adopted in this state, has made a determination that such requirements have been met.
(f) "Policy" means, except as otherwise provided in subsection (e) of this section, any individual or group policy, contract, subscriber agreement, rider or endorsement delivered or issued for delivery in this state by an insurer, fraternal benefit society, nonprofit medical and hospital service corporation, prepaid health plan, health maintenance organization or any similar organization.
History: L. 1987, ch. 156, § 3; L. 1997, ch. 8, § 9; July 1.
(1) To establish specific standards for policy provisions of long-term care insurance policies. Such standards shall be in addition to and in accordance with applicable laws of this state, and shall address terms of renewability, initial and subsequent conditions of eligibility, nonduplication of coverage provisions, coverage of dependents, preexisting conditions, termination of insurance, probationary periods, limitations, exceptions, reductions, elimination periods, requirements for replacement, recurrent conditions and definitions of terms, except that no regulation shall limit the number of days contained in an elimination period of confinement in a nursing facility or for all confinements in a nursing facility which are due to the same or related causes and separated from each other by less than 180 days; and
(2) to specify prohibited policy provisions not otherwise specifically authorized by statute which, in the opinion of the commissioner, are unjust, unfair or unfairly discriminatory to any person insured under a long-term care insurance policy.
(b) Rules and regulations adopted by the commissioner shall:
(1) Recognize the unique, developing and experimental nature of long-term care insurance; and
(2) recognize the appropriate distinctions necessary between group and individual long-term care insurance policies.
(c) The commissioner may adopt rules and regulations establishing loss-ratio standards for long-term care insurance policies if a specific reference to long-term care insurance policies is contained in the rules and regulations.
(d) No long-term care insurance policy may:
(1) Be canceled, nonrenewed, or otherwise terminated solely on the grounds of the age or the deterioration of the mental or physical health of the insured individual or certificateholder; or
(2) contain a provision establishing any new waiting period in the event existing coverage is converted to or replaced by a new or other form within the same company, except with respect to an increase in benefits voluntarily selected by the insured individual or group policyholder.
(e) (1) No long-term insurance policy or certificate shall use a definition of preexisting condition which is more restrictive than the following: "Preexisting condition" means a condition for which medical advice or treatment was recommended by, or received from a provider of health care services, within six months preceding the effective date of coverage of an insured person.
(2) No long-term care insurance policy shall exclude coverage for a loss or confinement which is the result of a preexisting condition unless such loss or confinement begins within six months following the effective date of coverage of an insured person.
(3) The commissioner may extend the limitation periods set forth in subsections (e)(1) and (e)(2) above as to specific age group categories or specific policy forms upon finding that the extension is not contrary to the best interest of the public.
(4) The definition of preexisting condition shall not prohibit an insurer from using an application form designed to elicit the complete health history of an applicant, and, on the basis of the answers on that application, from underwriting in accordance with that insurer's established underwriting standards.
(f) No long-term care insurance policy shall require prior institutionalization as a condition precedent to the payment of benefits.
(g) In order to provide for fair disclosure in the sale of long-term care insurance policies:
(1) An outline of coverage shall be delivered to an applicant for a long-term care insurance policy at the time of application. In the case of direct response solicitations, the insurer shall deliver the outline of coverage upon the applicant's request, but regardless of request, shall make such delivery no later than at the time of policy delivery. Such outline of coverage shall include:
(A) A description of the principal benefits and coverage provided in the policy;
(B) a statement of the principal exclusions, reductions and limitations contained in the policy;
(C) a statement of the renewal provisions, including any reservation in the policy of a right to change premiums; and
(D) 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.
(2) A certificate issued pursuant to a group long-term care insurance policy which policy is delivered or issued for delivery in this state shall include the information required by subsection (g)(4) of K.S.A. 40-2209, and amendments thereto.
(h) No policy shall be advertised, marketed or offered as long-term care insurance unless it complies with the provisions of this act.
History: L. 1987, ch. 156, § 4; L. 1997, ch. 190, § 5; L. 1998, ch. 174, § 11; L. 2002, ch. 168, § 1; July 1.
History: L. 1996, ch. 182, § 1; July 1.
(b) The applicant has the right to designate at least one person who is to receive the notice of termination, in addition to the insured. Designation of an additional person to receive notice of lapse or termination shall not constitute acceptance of any liability by such person for services provided to the insured. The designation shall include the full name and home address of such additional person.
(c) The policy or certificate shall include a waiver stated in clear terms in the case of an applicant who elects not to designate an additional person. The waiver shall state that the applicant has the right to designate at least one person other than the applicant who will receive notice of any lapse or termination of the long-term care policy or certificate and that the applicant elects not to designate an additional person to receive such notice.
(d) The insurer shall notify the insured of the right to change this written designation, no less often than once every two years.
History: L. 1996, ch. 182, § 2; July 1.
History: L. 1996, ch. 182, § 3; July 1.
History: L. 1996, ch. 182, § 4; July 1.
History: L. 1996, ch. 182, § 5; July 1.
(b) The provisions of the Kansas long-term care prompt payment act shall take effect and be in force on and after January 1, 2008.
History: L. 2007, ch. 150, § 5; July 1.
(a) The term "clean claim" means a claim that has no defect or impropriety, including any lack of required substantiating documentation, or particular circumstance requiring special treatment that prevents timely payment from being made on the claim under the Kansas long-term care insurance prompt payment act.
(b) The term "claim" means a written proof of loss as defined in paragraph (7) of subsection (A) of K.S.A. 40-2203, and amendments thereto, or an electronic proof of loss which contains the information required by paragraph (7) of subsection (A) of K.S.A. 40-2203, and amendments thereto.
(c) The term "long-term care insurance" shall have the meaning ascribed to it in K.S.A. 40-2227 and amendments thereto.
History: L. 2007, ch. 150, § 6; July 1.
(1) The insurer refuses to reimburse all or part of the claim and specify each reason for denial; or
(2) additional information is necessary to determine if all or any part of the claim will be reimbursed and what specific additional information is necessary.
(b) If any insurer issuing a policy of long-term care insurance fails to comply with subsection (a), such insurer shall pay interest at the rate of 1% per month on the amount of the claim that remains unpaid 30 days after the receipt of the claim. The interest paid pursuant to this subsection shall be included in any late reimbursement without requiring the person who filed the original claim to make any additional claim for such interest.
(c) After receiving a request for additional information, the person claiming reimbursement shall submit all additional information requested by the insurer within 30 days after receipt of the request for additional information. Failure to furnish such additional information within the time required shall not invalidate nor reduce the claim if it was not reasonably possible to give such information within such time, provided such proof is furnished as soon as possible as defined (within the time prescribed) in paragraph (7) of subsection (A) of K.S.A. 40-2203, and amendments thereto.
(d) Within 30 days after receipt of all the requested additional information, an insurer issuing a policy of long-term care insurance shall pay a clean claim in accordance with this section or send a written or electronic notice that states:
(1) Such insurer refuses to reimburse all or part of the claim; and
(2) specifies each reason for denial. Any insurer issuing a policy of long-term care insurance that fails to comply with this subsection shall pay interest on any amount of the claim that remains unpaid at the rate of 1% per month.
(e) The provisions of subsection (b) shall not apply when there is a good faith dispute about the legitimacy of the claim, or when there is a reasonable basis supported by specific information that such claim was submitted fraudulently.
(f) Any violation of this act by an insurer issuing a policy of long-term care insurance with flagrant and conscious disregard of the provisions of this act or with such frequency as to constitute a general business practice shall be considered a violation of the unfair trade practices act in K.S.A. 40-2401 et seq. and amendments thereto.
(g) The commissioner of insurance shall adopt rules and regulations necessary to carry out the provisions of the Kansas long-term care insurance prompt payment act.
History: L. 2007, ch. 150, § 7; July 1.
History: L. 1988, ch. 158, § 1; July 1.
History: L. 1988, ch. 158, § 2; L. 1994, ch. 141, § 1; April 14.
(a) "Continuing care contract" means an agreement pursuant to which a provider undertakes to furnish to a person, not related by consanguinity or affinity to the provider, shelter and medical or nursing services or other health-related benefits which require a present or deferred transfer of assets or an entrance fee in the amount of $5,000 or equivalent value or such greater amount as set by the commissioner in rules and regulations in addition to or in lieu of periodic charges. Continuing care contract shall also mean an agreement of any other provider who voluntarily applies for a certificate pursuant to K.S.A. 40-2235.
(b) "Entrance fee" means the total of any initial or deferred transfer to, or for the benefit of, a provider of a sum of money or other property made or promised to be made as full or partial consideration for acceptance of a person as a resident pursuant to a continuing care contract.
(c) "Home" means the facility or facilities occupied, or planned to be occupied, by five or more residents where the provider undertakes pursuant to the continuing care contract to provide continuing care to such residents.
(d) "Provider" or "continuing care provider" means the person, corporation, partnership, association or other legal entity which agrees to provide continuing care to residents in a home.
(e) "Resident" means an individual or individuals who have entered into an agreement with a provider for continuing care in a home.
(f) "Commissioner" means commissioner of insurance of the state of Kansas.
History: L. 1989, ch. 73, § 1; July 1.
(a) The name and business address of the provider and a statement of whether the provider is an individual, partnership, corporation or any other legal entity.
(b) The names of the individual or individuals who constitute the provider or, if the provider is a partnership, corporation or other legal entity, whether for profit or not for profit, the names of the officers, directors, trustees or managing or general partners of the provider. If the provider is a corporation, the name of any individual who owns 10% or more of the stock of such corporation shall also be disclosed.
(c) With respect to a provider which is either not incorporated or not established and operated on a not-for-profit basis, the names and business addresses of any individual having any ownership or any beneficial interest in the provider and a description of such individual's interest in or occupation with the provider.
(d) A statement as to whether or not the provider is, or is affiliated with, a religious, charitable or other nonprofit organization and the extent of the affiliation, if any; the extent to which any affiliate organization will be responsible for the financial and contractual obligations of the provider; the provision of the United States internal revenue code, if any, under which the provider or any of the provider's affiliates is or are exempt from the payment of federal income taxes; and, a statement of whether the home is exempt from local property taxation.
(e) A statement that the provider is required to have an annual certified audit by a certified public accountant and that a copy of such audit shall be made available upon request.
(f) If the operation of the home has not yet commenced, and with receipt of contract considerations as defined in K.S.A. 40-2231 (a) and (b), the provider shall provide a statement of the anticipated source and application of the funds used or to be used in the purchase or construction of the facility, including but not limited to:
(1) An estimate of such costs as financing expense, legal expense, land costs, marketing costs and other similar costs which the provider expects to incur or become obligated for prior to the commencement of operations;
(2) A description of any mortgage loan or any other financing intended to be used for the financing of the facility, including the anticipated terms and costs of such financing;
(3) An estimate of the total entrance fee to be received from or on behalf of residents at or prior to commencement of operation; and
(4) An estimate of the funds, if any, which are anticipated to be necessary to fund start-up losses and provide reserve funds to assure full performance of the obligations of the provider under continuing care contracts.
(g) A statement as to whether the manager or any official or director of the provider, has been convicted of a crime or been a party of any civil action claiming fraud, embezzlement, fraudulent conversion or misappropriation of property which resulted in a judgment against such person and whether any such person has had any state or federal license or permits related to care and housing suspended or revoked.
(h) A statement of the years of experience of the provider and manager in the operation of homes providing continuing care.
(i) A statement of the fiscal year of the provider.
History: L. 1989, ch. 73, § 2; July 1.
History: L. 1989, ch. 73, § 3; July 1.
(a) A description of all fees and or charges required of residents, a description of all services to be provided or committed to providing in the future and a description of any services for which an extra charge is made over and above entrance fees and periodic charges that are provided for in the contract;
(b) A listing of the terms and conditions under which the agreement may be cancelled by either party to the agreement or by which any or all of the entrance fee or transfer of assets would be refunded, less the value of any services received; and
(c) A statement describing health and financial conditions required to continue as a resident, including any changes in either health or financial conditions of the resident.
History: L. 1989, ch. 73, § 4; July 1.
History: L. 1989, ch. 73, § 5; July 1.
History: L. 1989, ch. 73, § 6; Repealed, L. 1997, ch. 24, § 7; July 1.
History: L. 1989, ch. 73, § 7; July 1.
History: L. 1989, ch. 73, § 8; July 1.
(a) "Carrier" means an insurance company, medical or hospital service corporation, medical and hospital service corporation or health maintenance organization which holds a valid certificate of authority from the insurance commissioner.
(b) "Commissioner" means the commissioner of insurance.
(c) "Eligible employee" means an employee who is employed by the employer for an average of at least 30 hours per week and who elects to participate in one of the benefit plans provided under this act, and includes individuals who are sole proprietors, business partners and limited partners. The term "eligible employee" does not include individuals:
(1) Engaged as independent contractors;
(2) whose periods of employment are on an intermittent or irregular basis; or
(3) who have been employed by the employer for fewer than 90 days.
(d) "Family member" means an eligible employee's spouse and any unmarried dependent child or stepchild.
(e) "Health benefit plan" means a contract for group medical, surgical, hospital or any other remedial care recognized by state law and related services and supplies.
(f) "Health savings account" means a trust created or organized in the United States as a health savings account exclusively for the purpose of paying the qualified medical expenses of the account beneficiary, but only if the written governing instrument creating the trust meets the requirements specified by the medicare, prescription drug, improvement and modernization act of 2003, Pub. L. No. 108-173, 117 Stat. 2067.
(g) "Premium" means the monthly or other periodic charge for a health benefit plan.
(h) "Small employer health benefit plan" means an arrangement providing a health benefit plan for the purpose described in K.S.A. 40-2240, and amendments thereto.
History: L. 1990, ch. 157, § 1; L. 1999, ch. 110, § 1; L. 2005, ch. 118, § 1; July 1.
(b) The commissioner shall provide assistance to employers desiring to organize and maintain any such benefit plan and may aid in the acquisition of the health care insurance by the small employer health benefit plan.
History: L. 1990, ch. 157, § 2; L. 1999, ch. 110, § 2; L. 2002, ch. 158, § 18; L. 2005, ch. 118, § 2; July 1.
(b) Where appropriate, the small employer health benefit plan shall provide options under which eligible employees may arrange coverage for their family members. Options for additional coverage for employees and their family members at an additional cost or premium may be provided.
(c) The provisions of K.S.A. 40-2209 and 40-2215 and amendments thereto shall apply to all contracts issued under this section or the act of which this section is a part and to health benefit plans as defined in K.S.A. 40-2239 and amendments thereto, and the provisions of such sections shall apply to small employer health benefit plans.
History: L. 1990, ch. 157, § 3; L. 1991, ch. 134, § 9; L. 1998, ch. 174, § 12; L. 1999, ch. 110, § 5; July 1.
History: L. 1990, ch. 157, § 4; L. 1992, ch. 56, § 1; L. 1999, ch. 110, § 3; L. 2005, ch. 118, § 3; July 1.
(b) The employer contribution shall be the amount necessary to pay the cost of the health benefit plan covering the employer's covered employees for which the employer does not require the employee to pay, including the administrative expenses therefor. An employer is not required to enroll an employee who is already enrolled in a health benefit plan other than the small employer health benefit plan.
(c) Payroll deductions for such costs payable by the employee shall be made by the employer upon receipt of a signed authorization from the employee indicating an election to participate in the small employer health benefit plan.
History: L. 1990, ch. 157, § 5; July 1.
History: L. 1990, ch. 157, §§ 6, 7; Repealed, L. 1999, ch. 110, § 9; July 1.
(b) (1) For employers that have established a small employer health benefit plan after December 31, 1999, but prior to January 1, 2005, the amount of the credit allowed by subsection (a) shall be $35 per month per eligible covered employee or 50% of the total amount paid by the employer during the taxable year, whichever is less, for the first two years of participation. In the third year, the credit shall be equal to 75% of the lesser of $35 per month per employee or 50% of the total amount paid by the employer during the taxable year. In the fourth year, the credit shall be equal to 50% of the lesser of $35 per month per employee or 50% of the total amount paid by the employer during the taxable year. In the fifth year, the credit shall be equal to 25% of the lesser of $35 per month per employee or 50% of the total amount paid by the employer during the taxable year. For the sixth and subsequent years, no credit shall be allowed.
(2) For employers that have established a small employer health benefit plan or made contributions to a health savings account of an eligible covered employee after December 31, 2004, the amount of credit allowed by subsection (a) shall be $70 per month per eligible covered employee for the first 12 months of participation, $50 per month per eligible covered employee for the next 12 months of participation and $35 per eligible covered employee for the next 12 months of participation. After 36 months of participation, no credit shall be allowed.
(c) If the credit allowed by this section is claimed, the amount of any deduction allowable under the Kansas income tax act for expenses described in this section shall be reduced by the dollar amount of the credit. The election to claim the credit shall be made at the time of filing the tax return in accordance with law. If the credit allowed by this section exceeds the taxes imposed under the Kansas income tax act for the taxable year, that portion of the credit which exceeds those taxes shall be refunded to the taxpayer.
(d) Any amount of expenses paid by an employer under this act shall not be included as income to the employee for purposes of the Kansas income tax act. If such expenses have been included in federal taxable income of the employee, the amount included shall be subtracted in arriving at state taxable income under the Kansas income tax act.
(e) The secretary of revenue shall promulgate rules and regulations to carry out the provisions of this section.
(f) This section shall apply to all taxable years commencing after December 31, 1999.
History: L. 1990, ch. 157, § 8; L. 1999, ch. 110, § 4; L. 2005, ch. 118, § 4; July 1.
History: L. 1990, ch. 157, § 9; July 1.
History: L. 1990, ch. 162, § 1; July 1.
(a) The social impact, including:
(1) The extent to which the treatment or service is generally utilized by a significant portion of the population;
(2) the extent to which such insurance coverage is already generally available;
(3) if coverage is not generally available, the extent to which the lack of coverage results in persons being unable to obtain necessary health care treatment;
(4) if the coverage is not generally available, the extent to which the lack of coverage results in unreasonable financial hardship on those persons needing treatment;
(5) the level of public demand for the treatment or service;
(6) the level of public demand for individual or group insurance coverage of the treatment or service;
(7) the level of interest of collective bargaining organizations in negotiating privately for inclusion of this coverage in group contracts; and
(8) the impact of indirect costs which are costs other than premiums and administrative costs, on the question of the costs and benefits of coverage.
(b) The financial impact, including:
(1) The extent to which insurance coverage of the kind proposed would increase or decrease the cost of the treatment or service;
(2) the extent to which the proposed coverage might increase the use of the treatment or service;
(3) the extent to which the mandated treatment or service might serve as an alternative for more expensive treatment or service;
(4) the extent to which insurance coverage of the health care service or provider can be reasonably expected to increase or decrease the insurance premium and administrative expenses of policyholders; and
(5) the impact of this coverage on the total cost of health care.
History: L. 1990, ch. 162, § 2; July 1.
(b) The legislature shall periodically review all health insurance coverages mandated by state law.
History: L. 1999, ch. 162, § 5; July 1.
(b) Notwithstanding the provisions of subsection (a), reimbursement shall be mandated with respect to services performed by an advanced registered nurse practitioner in Douglas, Johnson, Leavenworth, Sedgwick, Shawnee or Wyandotte counties.
(c) The provisions of subsection (b) shall expire on July 1, 1998.
History: L. 1990, ch. 162, § 3; L. 1993, ch. 137, § 1; July 1.
(b) The Kansas health policy authority, as administrator of the health care database, pursuant to K.S.A. 65-6804, and amendments thereto, shall serve as the statistical agent for the purpose of gathering, receiving and compiling the data required by the statistical plan or plans developed or approved under this section. The commissioner of insurance shall make an assessment upon the reporting insurance companies, health maintenance organizations, group self-funded pools, and other reporting entities sufficient to cover the anticipated expenses to be incurred by the Kansas health policy authority in gathering, receiving and compiling such data. Such assessment shall be in the form of an annual fee established by the Kansas health policy authority and charged to each reporting entity in proportion to such entity's respective shares of total health insurance premiums, subscriber charges and member fees received during the preceding calendar year. Such assessments shall be paid to the Kansas health policy authority and the Kansas health policy authority shall remit such fees to the state treasurer in accordance with the provisions of K.S.A. 75-4215, and amendments thereto. Upon receipt of each such remittance, the state treasurer shall deposit the entire amount in the state treasury to the credit of the insurance statistical plan fund. Compilations of aggregate data gathered under the statistical plan or plans required by this act shall be made available to insurers, trade associations and other interested parties.
(c) The Kansas health policy authority, in writing, shall report to the commissioner of insurance any insurance company, health maintenance organization, group self-funded pool, nonprofit hospital and medical service corporation and any other reporting entity which fails to report the information required in the form, manner or time prescribed by the Kansas health policy authority. Upon receipt of such report, the commissioner of insurance shall impose an appropriate penalty in accordance with K.S.A. 40-2,125, and amendments thereto.
History: L. 1990, ch. 170, § 1; L. 1994, ch. 238, § 13; L. 1995, ch. 260, § 1; L. 2001, ch. 5, § 117; L. 2006, ch. 156, § 1; July 1.
History: L. 1990, ch. 170, § 3; L. 1994, ch. 238, § 14; L. 2007, ch. 46, § 1; July 1.
(b) An accident and sickness insurer may not refuse to accept a claim submitted on duly promulgated uniform claim forms. An insurer may accept claims submitted on any other form.
(c) An accident and sickness insurer does not violate subsection (a) by using a document that the accident and sickness insurer has been required to use by the federal government or the state.
(d) The commissioner of insurance shall report to the governor and to the legislature, no later than the commencement of the 1993 regular session of the Kansas legislature, regarding the development of uniform electronic data interchange formats and standards, along with a proposed plan, including an analysis of the cost impact thereof.
History: L. 1991, ch. 133, § 1; L. 1992, ch. 73, § 1; July 1.
(a) Include in its contracts a provision extending payment of such benefits until discharged or for a period not less than 31 days following the expiration date of the policy, whichever is earlier, for covered insureds confined in a hospital on the date of termination;
(b) not fail to enroll in a replacement group policy, contract or certificate without any gap in coverage any individual who is confined to a hospital or otherwise disabled at the time such individual's prior group policy, contract or certificate terminates;
(c) provide that payment of benefits under any subsequent replacement policy, contract or certificate that is intended to afford continuous coverage will commence immediately following expiration of any prior policy, contract or certificate.
History: L. 1993, ch. 231, § 1; L. 2001, ch. 40, § 1; July 1.
(b) As used in this act:
(1) "Block of business" means a particular individual policy form or contract providing hospital, medical or surgical expense, long-term care or medicare supplement coverage issued by a carrier to one or more individuals which includes distinct benefits, services and terms.
(2) "Closed block of business" means a block of business which a carrier ceases to actively offer or sell to new applicants.
(3) "Carrier" means any insurance company, nonprofit medical and hospital service corporation, municipal group-funded pool, fraternal benefit society or health maintenance organization, as these terms are defined by the Kansas Statutes Annotated, that offers any individual hospital, surgical or medical expense, long-term care or medicare supplement policy and which is authorized to do business in this state. "Carrier" does not include those entities identified above with respect to the sale or issuance of policies or certificates covering only accident, credit, dental, disability income, hospital indemnity, specified disease, vision care, coverage issued as a supplement to liability insurance, insurance arising out of a workers compensation or similar law, automobile medical payment insurance, or insurance under which benefits are payable with or without regard to fault and which is statutorily required to be contained in any liability insurance policy or equivalent self-insurance.
(4) "Commissioner" means the commissioner of insurance.
(c) No block of business shall be closed by a carrier unless:
(1) The carrier provides written notice of the carrier's decision to close a block of business to each existing policyholder or contract holder affected and offers each policyholder or contract holder affected an opportunity to purchase a policy or contract from any block of business that is not closed and which provides comparable benefits, services and terms, with no additional underwriting requirement or waiting period. Each policyholder or contract holder affected by the carrier's decision to close a block of business shall be permitted to purchase such policy or contract during the 30-day period commencing on the day following the date of the written notice;
(2) the carrier pools the experience of the closed block of business with all appropriate blocks of business that are not closed for the purpose of determining the premium rate of any contract within the closed block, with no rate penalty or surcharge beyond that which reflects the experience of the combined pool; and
(3) if a carrier does not offer or sell any block of business which provides comparable benefits, services and terms comparable to the closed block of business, paragraphs (1) and (2) shall not apply. If a block of business providing benefits, services and terms comparable to the closed block of business becomes available within 24 months of the notice to the commissioner, such block shall be open to any contract holder in accordance with the provisions of paragraphs (1) and (2). The carrier shall provide notice to the commissioner in writing within 30 days of its decision to close a block of business or, in the absence of an actual decision to close a block of business, within 30 days of its determination that a block of business is within one of the presumptions set forth in subsection (d).
(d) Unless an insurer presents evidence satisfactory to the commissioner that such a presumption is or would be incorrect, a block of business shall be presumed closed if either of the following circumstances exist:
(1) There has been an overall reduction in that block of 12% in the number of in-force contracts for a period of 12 months; or
(2) that block has less than 500 in-force contracts in this state.
The presumption that applies in the circumstances of subsection (d)(2) shall not apply to a block of business initiated within the previous 24 months, but notification of that block of business shall be provided to the commissioner pursuant to subsection (e).
The fact that a block of business does not meet one of the presumptions set forth in this subsection shall not preclude a determination that it is closed as defined in paragraph (2) of subsection (b).
(e) A carrier shall notify the commissioner in writing within 30 days of its decision to close a block of business or, in the absence of an actual decision to close a block of business, within 30 days of its determination that a block of business is within one of the presumptions set forth in subsection (d). When the carrier decides to close a block of business, the written notice shall fully disclose all information required for compliance with subsection (c). When the carrier determines that a block of business is within a presumption of subsection (c), the written notice shall fully disclose all information required for compliance with a presumption of subsection (c). In the case of either notice, the carrier shall provide additional information within 15 business days after a request by the commissioner. This subsection shall not apply to a carrier which does not have available a block of business which provides comparable benefits, services and terms comparable to the closed block of business and which has complied with the notice requirements pursuant to subsection (c)(3).
(f) A carrier shall preserve for a period of not less than five years in an identified location which is readily accessible for review by the commissioner, all books and records relating to any action taken by a carrier pursuant to subsection (c).
(g) No carrier shall offer or sell any contract, or provide misleading information about the active or closed status of a block of business, for the purpose of evading this act.
History: L. 1994, ch. 41, § 1; L. 1994, ch. 280, § 1; L. 2005, ch. 163, § 10; July 1.
(b) As used in this section:
(1) "Health benefit plan" means any benefit plan, other than public assistance, which is able to provide hospital, surgical, medical, dental or any other health care or benefits for a child, whether through insurance or otherwise, and which is available through a parent's employment or other group plan.
(2) "Participating parent" means a parent who is eligible for single coverage under a health benefit plan as defined in this section, regardless of the type of coverage actually in effect, if any.
(3) "Nonparticipating parent" means, if one parent is a participating parent as defined in this section, the other parent.
(c) No employer, sponsor or other administrator of a health benefit plan shall deny enrollment of a child under the health coverage of the child's parent on the basis that: (1) The child was born out of wedlock; (2) the child is not claimed as a dependent on the parent's federal income tax return; (3) the child does not reside with the parent or in the plan's service area; or (4) the child is receiving, is eligible for or may become eligible for medical assistance.
(d) (1) A health benefit plan, in determining or making any payment for benefits of a child who is a participant or beneficiary under the plan, shall not take into account the fact that the child is receiving, is eligible for or may become eligible for medical assistance pursuant to Title XIX of the federal social security act.
(2) A health benefit plan shall pay for benefits with respect to a child who is a participant or beneficiary under the plan in accordance with any assignment of rights made by or on behalf of the child as required by K.S.A. 39-709 and amendments thereto or by another state's plan for medical assistance pursuant to Title XIX of the federal social security act.
(3) A health benefit plan shall not impose requirements on an agency or official, assigned the rights of a child eligible for medical assistance under Title XIX of the federal social security act and covered by the health benefit plan, that are different from requirements applicable to an agent or assignee of any other individual covered by the health benefit plan.
(4) If payment has been made by the secretary of social and rehabilitation services for medical assistance and a health benefit plan is liable to pay for any item or service constituting any part of the medical assistance, the health benefit plan shall make payment for benefits under the plan to the secretary of social and rehabilitation services to the extent of the secretary's rights pursuant to K.S.A. 39-719a and amendments thereto.
(e) In addition to other duties specified in a health benefit plan, when a child is covered by the health benefit plan of a participating parent the employer, sponsor or other administrator of the health benefit plan: (1) Shall provide information necessary for the child to obtain benefits to the nonparticipating parent or, upon request, to the nonparticipating parent's assignee or to a representative designated in a medical withholding order; (2) shall permit the nonparticipating parent, the nonparticipating parent's assignee, or a provider properly authorized by the nonparticipating parent or assignee to submit claims for covered services without the approval of the participating parent; and (3) shall make payment on claims submitted in accordance with subsection (e)(2) directly to the nonparticipating parent, assignee or provider.
(f) Nothing in this section or the income withholding act and amendments thereto shall limit alteration of a health benefit plan's coverage or terms, so long as the resulting plan meets the requirements of this section or the income withholding act and amendments thereto.
(g) Any amendment to a health benefit plan required to conform to the requirements of this section or the income withholding act and amendments thereto shall not be required to be effective before the first plan year beginning on or after July 1, 1994, if: (1) During the period from July 1, 1994, until the beginning of the first plan year, the plan is operated in accordance with the requirements of this section or the income withholding act and amendments thereto; and (2) the plan amendment applies retroactively to July 1, 1994, as well as prospectively. A plan shall not be treated as failing to be operated in accordance with the provisions of the plan merely because it operates in accordance with this subsection.
(h) This section shall be part of and supplemental to chapter 40 of the Kansas Statutes Annotated.
History: L. 1994, ch. 301, § 13; July 1.
(b) An accident and sickness insurer may nonrenew or discontinue an individual policy providing hospital, medical or surgical expense benefits based only on one or more of the following:
(1) If the individual has failed to pay premiums or contributions in accordance with the terms of the health insurance coverage or the accident and sickness insurer has not received timely premium payments;
(2) if the individual has performed an act or practice that constitutes fraud or made an intentional misrepresentation of material fact under the terms of the coverage;
(3) if the accident and sickness insurer is ceasing to offer individual policies providing hospital, medical or surgical expense benefits in accordance with subsection (c);
(4) in the case of accident and sickness insurer which offers individual policies providing hospital, medical or surgical expense benefits through enrollment area, if the individual no longer resides, lives or works in the medical service enrollment area (or in an area for which the accident and sickness insurer is authorized to do business) but only if such coverage is terminated under this paragraph uniformly without regard to any health status-related factor of covered individuals; or
(5) if the case of a policy providing hospital, medical or surgical expense benefits that is made available to individuals only through one or more bona fide associations, the membership of the individual in the association (on the basis of which the coverage is provided) ceases but only if such coverage is terminated under this paragraph uniformly without regard to any health status-related factor of covered individuals.
(c) If the accident and sickness insurer decides to discontinue offering a particular individual policy providing hospital, medical or surgical expense benefits such policy may only be discontinue if:
(1) The accident and sickness insurer provides notice to each covered individual who is provided such policy providing hospital, medical or surgical expense benefits at least 90 days prior to the date of the discontinuation of such coverage;
(2) the accident and sickness insurer offers to each covered individual who is provided such policy providing hospital, medical or surgical expense benefits the option to purchase any other individual policy providing hospital, medical or surgical expense benefits which is being sold by the accident and sickness insurer; and
(3) in exercising the option to discontinue coverage and in offering the option of coverage under subsection (b), the accident and sickness insurer acts uniformly without regard to any health status-related factor of enrolled individuals or individuals who may become eligible for coverage under the policy.
(d) Subject to subsection (c), if the accident and sickness insurer elects to discontinue offering any individual policies providing hospital, medical or surgical expense benefits in this state, such insurance coverage may be discontinued only if:
(1) The accident and sickness insurer provides notice to the commissioner and to each individual policyholder of such discontinuation at least 180 days prior to the date of the expiration of such coverage; and
(2) the accident and sickness insurer is prohibited from the issuance of any individual policies providing hospital, medical or surgical expense benefits in the state during a five-year period beginning on the date of the discontinuation of the last individual policy providing hospital, medical or surgical expense benefits which is not renewed.
(e) An accident and sickness insurer may modify the terms and conditions of the individual policy providing hospital, medical or surgical expense benefits so long as such modification is consistent with other provisions of the insurance code and is effective on a uniform basis among all individuals who are covered by such policy.
(f) In applying this section in the case of individual policies providing hospital, medical or surgical expense benefits that are made available by accident and sickness insurer to individuals only through one or more associations, a reference to an "individual" is deemed to include a reference to such an association of which the individual is a member.
(g) As used in this section, "health status-related factor" means: (1) A physical or mental illness medical condition; (2) claims experience; (3) receipt of health care; (4) medical history; (5) genetic information; (6) evidence of insurability including conditions arising out of acts of domestic violence; and (7) disability.
(h) As used in this section, "policies providing hospital, medical or surgical expense benefits" does not include short term, limited duration policies of insurance.
(i) The commissioner is hereby authorized to adopt such rules and regulations as may be necessary to carry out the provisions of this section.
History: L. 1997, ch. 190, § 12; July 1.
(1) If the policy does not include an aggregate lifetime limit on substantially all hospital, medical and surgical expense benefits, the policy may not impose any aggregate lifetime limit on mental illness or alcoholism, drug abuse or other substance use disorder benefits;
(2) if the policy includes an aggregate lifetime limit on substantially all hospital, medical and surgical expense benefits the plan shall either: (A) Apply the applicable lifetime limit both to the hospital, medical and surgical expense benefits to which it otherwise would apply and to mental illness or alcoholism, drug abuse or other substance use disorder benefits and not distinguished in the application of such limit between such hospital, medical and surgical expense benefits and mental illness or alcoholism, drug abuse or other substance use disorder benefits; or (B) not include any aggregate lifetime limit on mental illness or alcoholism, drug abuse or other substance use disorder benefits that is less than the applicable lifetime limit on hospital, medical and surgical expense benefits;
(3) if the policy does not include an annual limit on substantially all hospital, medical and surgical expense benefits, the plan or coverage may not impose any annual limit on mental illness or alcoholism, drug abuse or other substance use disorder benefits; and
(4) if the policy includes an annual limit on substantially all hospital, medical and surgical expense benefits the policy shall either: (A) Apply the applicable annual limit both to hospital, medical and surgical expense benefits to which it otherwise would apply and to mental illness or alcoholism, drug abuse or other substance use disorder benefits and not distinguish in the application of such limit between such hospital, medical and surgical expense benefits and mental illness or alcoholism, drug abuse or other substance use disorder benefits; or (B) not include any annual limit on mental illness or alcoholism, drug abuse or other substance use disorder benefits that is less than the applicable annual limit.
(b) If the group policy providing hospital, medical or surgical expense benefits is not otherwise covered by subsection (a) and either does not apply a lifetime or annual benefit or applies different lifetime or annual benefits to different categories of hospital, medical and surgical expense benefits, the commissioner may adopt rules and regulations under which subsections (a)(2) and (a)(4) are applied to such policies with respect to mental illness or alcoholism, drug abuse or other substance use disorder benefits by substituting for the applicable lifetime or annual limits an average limit that is computed taking into account the weighted average of the lifetime or annual limits applicable to such categories.
(c) Nothing in this section shall be construed as either:
(1) Requiring an accident and sickness policy to offer mental illness or alcoholism, drug abuse or other substance use disorder benefits except as otherwise required by K.S.A. 40-2,105a, and amendments thereto; or
(2) affecting any terms and conditions of a policy which does include mental illness or alcoholism, drug abuse or other substance use disorder benefits including provisions regarding cost sharing, limits on the number of visits or days of coverage, requirements relating to medical necessity, requirements relating to the amount, duration or scope of mental illness or alcoholism, drug abuse or other substance use disorder benefits under the plan or coverage, except as specifically provided in subsection (a).
(d) This section shall not apply to any group accident and health insurance policy which is sold to a small employer as defined in K.S.A. 40-2209, and amendments thereto.
(e) This section shall not apply with respect to a group policy providing hospital, medical or surgical expense benefits if the application of this section will result in an increase in the cost under the plan of at least 2% in the case of the first plan year in which this section is applied and 1% in the case of each subsequent plan year. Determinations as to increases in actual costs under a plan shall be made and certified by a qualified and licensed actuary who is a member in good standing of the American academy of actuaries. All such determinations shall be in a written report prepared by the actuary.
(f) In the case of a group policy providing hospital, medical or surgical expense benefits that offers an eligible employee, member or dependent two or more benefit package options under the policy, subsections (a) and (b) shall be applied separately with respect to each such option.
(g) As used in this section:
(1) "Aggregate lifetime limit" means, with respect to benefits under a group policy providing hospital, medical or surgical expense benefits, a dollar limitation on the total amount that may be paid with respect to such benefits under the policy with respect to an eligible employee, member or dependent;
(2) "annual limit" means, with respect to benefits under a group policy providing hospital, medical or surgical expense benefits, a dollar limitation on the total amount of benefits that may be paid with respect to such benefits in a 12-month period under the policy with respect to an eligible employee, member or dependent;
(3) "hospital, medical or surgical expense benefits" means benefits with respect to hospital, medical or surgical services, as defined under the terms of the policy;
(4) "mental illness benefits" means benefits with respect to mental health services, as defined under the terms of the policy;
(5) "alcoholism, drug abuse or substance use disorder benefits" means benefits with respect to services for the treatment of alcoholism, drug abuse or other substance use disorders, as defined under the terms of the policy;
(6) "mental illness, alcoholism, drug abuse or substance use" means disorders specified in the diagnostic and statistical manual of mental disorders, fourth edition, (DSM-IV, 1994) of the American psychiatric association.
(h) This section shall be effective for group policies providing hospital, medical or surgical expense benefits which are entered into or renewed after January 1, 1998.
(i) The commissioner is hereby authorized to adopt such rules and regulations as may be necessary to carry out the provisions of this section.
History: L. 1997, ch. 190, § 13; L. 2002, ch. 158, § 19; L. 2003, ch. 88, § 1; L. 2004, ch. 157, § 1; L. 2005, ch. 163, § 11; L. 2006, ch. 123, § 1; L. 2007, ch. 25, § 1; L. 2008, ch. 13, § 1; L. 2009, ch. 136, § 9; Nov. 1.
(b) An insurance company, health maintenance organization, nonprofit medical and hospital, dental, optometric or pharmacy corporations, or a group subject to K.S.A. 12-2616 et seq., and amendments thereto, shall not:
(1) Require or request directly or indirectly any individual or a member of the individual's family to obtain a genetic test;
(2) require or request directly or indirectly any individual to reveal whether the individual or a member of the individual's family has obtained a genetic test or the results of the test, if obtained by the individual or a member of the individual's family;
(3) condition the provision of insurance coverage or health care benefits on whether an individual or a member of the individual's family has obtained a genetic test or the results of the test, if obtained by the individual or a member of the individual's family; or
(4) consider in the determination of rates or any other aspect of insurance coverage or health care benefits provided to an individual whether an individual or a member of the individual's family has obtained a genetic test or the results of the test, if obtained by the individual or a member of the individual's family.
(c) Subsection (b) does not apply to an insurer writing life insurance, disability income insurance or long-term care insurance coverage.
(d) An insurer writing life insurance, disability income insurance or long-term care insurance coverage that obtains information under paragraphs (1) or (2) of subsection (b), shall not:
(1) Use the information contrary to paragraphs (3) or (4) of subsection (b) in writing a type of insurance coverage other than life for the individual or a member of the individual's family; or
(2) provide for rates or any other aspect of coverage that is not reasonably related to the risk involved.
History: L. 1997, ch. 190, § 14; July 1.
(b) As used in this section "insurer" means any insurance company, fraternal benefit society, health maintenance organization and nonprofit hospital and medical service corporation authorized to transact health insurance business in this state.
(c) An insurer that establishes or facilitates the establishment of a premium only cafeteria plan or other payroll deduction program pursuant to 26 U.S.C. Section 125 does not violate K.S.A. 40-2404, and amendments thereto.
(d) Nothing in this section shall be construed as prohibiting an insurer from:
(1) Charging a fee for establishing or facilitating the establishment of a premium only cafeteria plan pursuant to this section, and amendments thereto; or
(2) utilizing a vendor to facilitate the establishment of a premium only cafeteria plan pursuant to this section, and amendments thereto.
(e) The provisions of this section shall not take effect until July 1, 2008.
History: L. 2008, ch. 164, § 1; May 29.
(b) No provision of this section shall prohibit or otherwise restrict an employer's ability to either provide a group health benefit plan or create a premium only cafeteria plan with defined contributions and in which the employee purchases the policy.
(c) For the purposes of this section:
(1) "Health benefit plan" means any hospital or medical expense policy, health, hospital or medical service corporation contract and a plan provided by a municipal group-funded pool or a health maintenance organization contract offered by an employer or any certificate issued under any such policies, contracts or plans. Health benefit plan also includes a cafeteria plan authorized by 26 U.S.C. Section 125. The cafeteria plan may offer the option of paying all or any portion of the health insurance premium or the option of receiving health insurance coverage through a high deductible health plan and the establishment of a health savings account. In order for an eligible individual to obtain a high deductible health plan through the cafeteria plan, such individual shall present evidence to the employer that such individual has established a health savings account in compliance with 26 U.S.C. Section 223 and any amendments and regulations. "Health benefit plan" does not include policies or certificates covering only accident, credit, dental, disability income, long-term care, hospital indemnity, medicare supplement, specified disease, vision care, coverage issued as a supplement to liability insurance, insurance arising out of a workers compensation or similar law, automobile medical-payment insurance or insurance under which benefits are payable with or without regard to fault and which is statutorily required to be contained in any liability insurance policy or equivalent self-insurance.
(2) "Health savings account" shall have the same meaning ascribed to it as in subsection (d) of 26 U.S.C. Section 223.
(3) "High deductible health plan" shall mean a policy or contract of health insurance or health care plan that meets the criteria established in subsection (c) of 26 U.S.C. Section 223 and any amendments and regulations.
(d) The provisions of this section shall not take effect until July 1, 2008.
History: L. 2008, ch. 164, § 2; May 29.
(b) An individual who does not have continuation of coverage as described in K.S.A. 40-2209(i), and amendments thereto, in effect on March 1, 2009, but who would be an assistance eligible individual under the American recovery and reinvestment act of 2009 if such assistance had been in effect, may elect special assisted continuation of coverage pursuant to this subsection.
(c) The employer of the terminated employee shall provide the additional notice of the right to elect coverage pursuant to this section as required by the American recovery and reinvestment act of 2009.
(d) Election as required by the American recovery and reinvestment act of 2009 shall be made by an assistance eligible individual to the insurer.
(e) Special assisted continuation of coverage elected pursuant to this section shall commence with the first period of assisted continuation of coverage beginning on or after the date of the enactment of the American recovery and reinvestment act of 2009 and shall extend for the period of special assisted continuation of coverage allowed by the American recovery and reinvestment act of 2009 and amendments thereto.
(f) With respect to individuals who elect special assisted continuation coverage pursuant to this section, the 18 months of continuation coverage required by K.S.A. 40-2209(i), and amendments thereto, shall commence on the date an individual qualifies for continuation of coverage and shall terminate 18 months thereafter with the period of special assisted continuation coverage included therein.
(g) With respect to an individual who elects special assisted coverage pursuant to this section, any preexisting conditions arising between the date of the qualifying event and ending with the first period of coverage beginning on or after the date of the enactment of the American recovery and reinvestment act of 2009 shall be disregarded for the purpose of determining the 63-day period referred to in K.S.A. 40-2209(a)(8)(L), and amendments thereto.
(h) An individual applying for special assisted continuation coverage must provide the individual's social security number to the insurer.
(i) Premiums for special assistance continuation of coverage shall be paid by the assistance eligible individual to the insurance carrier.
(j) An individual eligible for assisted continuation of coverage who elects such coverage shall be entitled to the premium subsidy provided in the American recovery and reinvestment act of 2009, and amendments thereto, so long as they meet the requirements for special assisted continuation coverage pursuant to the terms of the American recovery and reinvestment act of 2009.
(k) The insurer shall pay the subsidy required by the American recovery and reinvestment act of 2009, and amendments thereto. Such insurer shall have the right to reimbursement for the subsidy as set forth in the American recovery and reinvestment act of 2009.
(l) In all cases in which an individual described above pays the premium for continuation of coverage, the individual shall have the right to continuation of coverage for 18 months as set forth in K.S.A. 40-2209(i), and amendments thereto, with any period of premium subsidy counted toward that individual's period of continuation of coverage. In no case, shall an individual be entitled to more than 18 months of continuing of coverage or more than nine months of special assisted continuing coverage.
(m) The provisions of this section shall expire on January 1, 2011.
History: L. 2009, ch. 83, § 28; Apr. 23.