0001| HOUSE BILL 370 | 0002| 43RD LEGISLATURE - STATE OF NEW MEXICO - SECOND SESSION, 1998 | 0003| INTRODUCED BY | 0004| M. MICHAEL OLGUIN | 0005| | 0006| | 0007| | 0008| | 0009| | 0010| AN ACT | 0011| RELATING TO HEALTH INSURANCE; MAKING CHANGES IN THE HEALTH | 0012| INSURANCE PORTABILITY ACT TO FULFILL FEDERAL LAW REQUIREMENTS; | 0013| AMENDING PROVISIONS OF THE INSURANCE CODE TO PROVIDE | 0014| CONSISTENCY; DECLARING AN EMERGENCY. | 0015| | 0016| BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO: | 0017| Section 1. Section 59A-18-13.1 NMSA 1978 (being Laws | 0018| 1994, Chapter 75, Section 26, as amended by Laws 1997, Chapter | 0019| 22, Section 1 and also by Laws 1997, Chapter 243, Section 18) | 0020| is amended to read: | 0021| "59A-18-13.1. ADJUSTED COMMUNITY RATING.-- | 0022| A. Every insurer, fraternal benefit society, | 0023| health maintenance organization or nonprofit health care plan | 0024| that provides primary health insurance or health care coverage | 0025| insuring or covering major medical expenses shall, in | - 1 - 0001| determining the initial year's premium charged for an | 0002| individual, use only the rating factors of age, gender, | 0003| geographic area of the place of employment and smoking | 0004| practices, except that for individual policies the rating | 0005| factor of the individual's place of residence may be used | 0006| instead of the geographic area of the individual's place of | 0007| employment. | 0008| B. In determining the initial and any subsequent | 0009| year's rate, the difference in rates in any one age group that | 0010| may be charged on the basis of a person's gender shall not | 0011| exceed another person's rates in the age group by more than | 0012| twenty percent of the lower rate, and no person's rate shall | 0013| exceed the rate of any other person with similar family | 0014| composition by more than two hundred fifty percent of the | 0015| lower rate, except that the rates for children under the age | 0016| of nineteen or children aged nineteen to twenty-five who are | 0017| full-time students may be lower than the bottom rates in the | 0018| two hundred fifty percent band. The rating factor | 0019| restrictions shall not prohibit an insurer, society, | 0020| organization or plan from offering rates that differ depending | 0021| upon family composition. | 0022| C. The provisions of this section do not preclude | 0023| an insurer, fraternal benefit society, health maintenance | 0024| organization or nonprofit health care plan from using health | 0025| status or occupational or industry classification in | - 2 - 0001| establishing: | 0002| (1) rates for individual policies; or | 0003| (2) the amount an employer may be charged for | 0004| coverage under the group health plan. | 0005| ~~[B.]~~ D. The superintendent shall adopt | 0006| regulations to implement the provisions of this section." | 0007| Section 2. Section 59A-22-24 NMSA 1978 (being Laws 1984, | 0008| Chapter 127, Section 445) is amended to read: | 0009| "59A-22-24. CANCELLATION.--There may be a provision as | 0010| follows: | 0011| The insurance company may cancel this policy only ~~[at~~ | 0012| ~~the expiration of any term for which the premium has been paid~~ | 0013| ~~by written notice delivered to the insured, or mailed to his~~ | 0014| ~~last address as shown by the records of the insurance company,~~ | 0015| ~~stating when, not less than five days thereafter, such~~ | 0016| ~~cancellation shall be effective]~~ pursuant to the provisions | 0017| of Section 59A-23E-19 NMSA 1978." | 0018| Section 3. Section 59A-23B-6 NMSA 1978 (being Laws 1991, | 0019| Chapter 111, Section 6, as amended by Laws 1997, Chapter 22, | 0020| Section 2 and also by Laws 1997, Chapter 243, Section 21) is | 0021| amended to read: | 0022| "59A-23B-6. FORMS AND RATES--APPROVAL OF THE | 0023| SUPERINTENDENT--ADJUSTED COMMUNITY RATING.-- | 0024| A. All policy or plan forms, including | 0025| applications, enrollment forms, policies, plans, certificates, | - 3 - 0001| evidences of coverage, riders, amendments, endorsements and | 0002| disclosure forms, shall be submitted to the ~~[department of~~ | 0003| ~~insurance]~~ superintendent for approval prior to use. | 0004| B. No policy or plan may be issued in the state | 0005| unless the rates have first been filed with and approved by | 0006| the superintendent. This subsection shall not apply to | 0007| policies or plans subject to the Small Group Rate and | 0008| Renewability Act. | 0009| C. In determining the initial year's premium or | 0010| rate charged for coverage under a policy or plan, the only | 0011| rating factors that may be used are age, gender, geographic | 0012| area of the place of employment and smoking practices, except | 0013| that for individual policies the rating factor of the | 0014| individual's place of residence may be used instead of the | 0015| geographic area of the individual's place of employment. In | 0016| determining the initial and any subsequent year's rate, the | 0017| difference in rates in any one age group that may be charged | 0018| on the basis of a person's gender shall not exceed another | 0019| person's rate in the age group by more than twenty percent of | 0020| the lower rate, and no person's rate shall exceed the rate of | 0021| any other person with similar family composition by more than | 0022| two hundred fifty percent of the lower rate, except that the | 0023| rates for children under the age of nineteen or children aged | 0024| nineteen to twenty-five who are full-time students may be | 0025| lower than the bottom rates in the two hundred fifty percent | - 4 - 0001| band. The rating factor restrictions shall not prohibit an | 0002| insurer, society, organization or plan from offering rates | 0003| that differ depending upon family composition. | 0004| D. The provisions of this section do not preclude | 0005| an insurer, fraternal benefit society, health maintenance | 0006| organization or nonprofit healthcare plan from using health | 0007| status or occupational or industry classification in | 0008| establishing: | 0009| (1) rates for individual policies; or | 0010| (2) the amount an employer may be charged for | 0011| coverage under a group health plan. | 0012| ~~[D.]~~ E. The superintendent shall adopt | 0013| regulations to implement the provisions of this section." | 0014| Section 4. Section 59A-23C-5.1 NMSA 1978 (being Laws | 0015| 1994, Chapter 75, Section 33, as amended by Laws 1997, Chapter | 0016| 22, Section 3 and also by Laws 1997, Chapter 243, Section 24) | 0017| is amended to read: | 0018| "59A-23C-5.1. ADJUSTED COMMUNITY RATING.-- | 0019| A. ~~[Until July 1, 1998,]~~ A health benefit plan | 0020| that is offered by a carrier to a small employer shall be | 0021| offered without regard to the health status of any individual | 0022| in the group, except as provided in the Small Group Rate and | 0023| Renewability Act. The only rating factors that may be used to | 0024| determine the initial year's premium charged a group, subject | 0025| to the maximum rate variation provided in this section for all | - 5 - 0001| rating factors, are the group members': | 0002| (1) ages; | 0003| (2) genders; | 0004| (3) geographic areas of the place of | 0005| employment; or | 0006| (4) smoking practices. | 0007| B. In determining the initial and any subsequent | 0008| year's rate, the difference in rates in any one age group that | 0009| may be charged on the basis of a person's gender shall not | 0010| exceed another person's rate in the age group by more than | 0011| twenty percent of the lower rate, and no person's rate shall | 0012| exceed the rate of any other person with similar family | 0013| composition by more than two hundred fifty percent of the | 0014| lower rate, except that the rates for children under the age | 0015| of nineteen or children aged nineteen to twenty-five who are | 0016| full-time students may be lower than the bottom rates in the | 0017| two hundred fifty percent band. The rating factor | 0018| restrictions shall not prohibit a carrier from offering rates | 0019| that differ depending upon family composition. | 0020| C. The provisions of this section do not preclude | 0021| a carrier from using health status or occupational or industry | 0022| classification in establishing the amount an employer may be | 0023| charged for coverage under a group health plan. | 0024| ~~[C.]~~ D. The superintendent shall adopt | 0025| regulations to implement the provisions of this section." | - 6 - 0001| Section 5. Section 59A-23E-1 NMSA 1978 (being Laws 1997, | 0002| Chapter 243, Section 1) is amended to read: | 0003| "59A-23E-1. SHORT TITLE.--~~[Sections 1 through 17 of~~ | 0004| ~~this act]~~ Chapter 59A, Article 23E NMSA 1978 may be cited | 0005| as the "Health Insurance Portability Act"." | 0006| Section 6. Section 59A-23E-2 NMSA 1978 (being Laws 1997, | 0007| Chapter 243, Section 2) is amended to read: | 0008| "59A-23E-2. DEFINITIONS.--As used in the Health | 0009| Insurance Portability Act: | 0010| A. "affiliation period" means a period that must | 0011| expire before health insurance coverage offered by a health | 0012| maintenance organization becomes effective; | 0013| B. "beneficiary" means that term as defined in | 0014| Section 3(8) of the federal Employee Retirement Income | 0015| Security Act of 1974; | 0016| C. "bona fide association" means an association | 0017| that: | 0018| (1) has been actively in existence for five | 0019| or more years; | 0020| (2) has been formed and maintained in good | 0021| faith for ~~[purpose]~~ purposes other than obtaining | 0022| insurance; | 0023| (3) does not condition membership in the | 0024| association on any health status related factor relating to an | 0025| individual, including an employee or a dependent of an | - 7 - 0001| employee; | 0002| (4) makes health insurance coverage offered | 0003| through the association available to all members regardless of | 0004| any health status related factor relating to the members or | 0005| individuals eligible for coverage through a member; and | 0006| (5) does not offer health insurance coverage | 0007| to an individual through the association except in connection | 0008| with a member of the association; | 0009| D. "church plan" means that term as defined | 0010| pursuant to Section 3(33) of the federal Employee Retirement | 0011| Income Security Act of 1974; | 0012| E. "COBRA" means the federal Consolidated Omnibus | 0013| Budget Reconciliation Act of 1985; | 0014| F. "COBRA continuation provision" means: | 0015| (1) Section 4980 of the Internal Revenue Code | 0016| of 1986, except for Subsection (f)(1) of that section as it | 0017| relates to pediatric vaccines; | 0018| (2) Part 6 of Subtitle B of Title 1 of the | 0019| federal Employee Retirement Income Security Act of 1974 | 0020| except for Section 609 of that part; or | 0021| (3) Title 22 of the federal Health Insurance | 0022| Portability and Accountability Act of 1996; | 0023| G. "creditable coverage" means, with respect to an | 0024| individual, coverage of the individual pursuant to: | 0025| (1) a group health plan; | - 8 - 0001| (2) health insurance coverage; | 0002| (3) Part A or Part B of Title 18 of the | 0003| Social Security Act; | 0004| (4) Title 19 of the Social Security Act | 0005| except coverage consisting solely of benefits pursuant to | 0006| Section 1928 of that title; | 0007| (5) 10 USCA Chapter 55; | 0008| (6) a medical care program of the Indian | 0009| health service or of an Indian nation, tribe or pueblo; | 0010| (7) the Comprehensive Health Insurance Pool | 0011| Act; | 0012| (8) a health plan offered pursuant to 5 USCA | 0013| Chapter 89; | 0014| (9) a public health plan as defined in | 0015| federal regulations; or | 0016| (10) a health benefit plan offered pursuant | 0017| to Section 5(e) of the federal Peace Corps Act; | 0018| ~~[H. "eligible individual" means, with respect to~~ | 0019| ~~a health insurance issuer that offers health insurance~~ | 0020| ~~coverage to a small employer in connection with a group health~~ | 0021| ~~plan in the small group market, an individual whose~~ | 0022| ~~eligibility shall be determined:~~ | 0023| ~~(1) in accordance with the terms of the plan;~~ | 0024| ~~(2) as provided by the issuer under the rules~~ | 0025| ~~of the issuer that are uniformly applicable in the state to~~ | - 9 - 0001| ~~small employers in the small group market; and~~ | 0002| ~~(3) in accordance with state laws governing~~ | 0003| ~~the issuer and the small group market;~~ | 0004| ~~I.]~~ H. "employee" means that term as defined in | 0005| Section 3(6) of the federal Employee Retirement Income | 0006| Security Act of 1974; | 0007| ~~[J.]~~ I. "employer" means: | 0008| (1) a person who is an employer as that | 0009| term ~~[as]~~ is defined in Section 3(5) of the federal | 0010| Employee Retirement Income Security Act of 1974, ~~[but to be~~ | 0011| ~~an "employer", a person must employ]~~ and who employs two or | 0012| more employees; and | 0013| (2) a partnership in relation to a partner | 0014| pursuant to Section 59A-23E-17 NMSA 1978; | 0015| ~~[K.]~~ J. "employer contribution rule" means a | 0016| requirement relating to the minimum level or amount of | 0017| employer contribution toward the premium for enrollment of | 0018| participants and beneficiaries; | 0019| ~~[L.]~~ K. "enrollment date" means, with respect | 0020| to an individual covered under a group health plan or health | 0021| insurance coverage, the date of enrollment of the individual | 0022| in the plan or coverage or, if earlier, the first day of the | 0023| waiting period for enrollment; | 0024| ~~[M.]~~ L. "excepted benefits" means benefits | 0025| furnished pursuant to the following: | - 10 - 0001| (1) coverage only accident or disability | 0002| income insurance; | 0003| (2) coverage issued as a supplement to | 0004| liability insurance; | 0005| (3) liability insurance; | 0006| (4) workers' compensation or similar | 0007| insurance; | 0008| (5) automobile medical payment insurance; | 0009| (6) credit-only insurance; | 0010| (7) coverage for on-site medical clinics; | 0011| (8) other similar insurance coverage | 0012| specified in regulations under which benefits for medical care | 0013| are secondary or incidental to other benefits; | 0014| (9) the following benefits if offered | 0015| separately: | 0016| (a) limited scope dental or vision | 0017| benefits; | 0018| (b) benefits for long-term care, | 0019| nursing home care, home health care, community-based care or | 0020| any combination of those benefits; and | 0021| (c) other similar limited benefits | 0022| specified in regulations; | 0023| (10) the following benefits, offered as | 0024| independent noncoordinated benefits: | 0025| (a) coverage only for a specified | - 11 - 0001| disease or illness; or | 0002| (b) hospital indemnity or other fixed | 0003| indemnity insurance; and | 0004| (11) the following benefits if offered as a | 0005| separate insurance policy: | 0006| (a) medicare supplemental health | 0007| insurance as defined pursuant to Section 1882(g)(1) of the | 0008| Social Security Act; and | 0009| (b) coverage supplemental to the | 0010| coverage provided pursuant to Chapter 55 of Title 10 USCA and | 0011| similar supplemental coverage provided to coverage pursuant to | 0012| a group health plan; | 0013| ~~[N.]~~ M. "federal governmental plan" means a | 0014| governmental plan established or maintained for its employees | 0015| by the United States government or an instrumentality of that | 0016| government; | 0017| ~~[O.]~~ N. "governmental plan" means that term as | 0018| defined in Section 3(32) of the federal Employee Retirement | 0019| Income Security Act of 1974 and includes a federal | 0020| governmental plan; | 0021| ~~[P.]~~ O. "group health insurance coverage" | 0022| means health insurance coverage offered in connection with a | 0023| group health plan; | 0024| ~~[Q.]~~ P. "group health plan" means an employee | 0025| welfare benefit plan as defined in Section 3(1) of the | - 12 - 0001| federal Employee Retirement Income Security Act of 1974 to | 0002| the extent that the plan provides medical care and includes | 0003| items and services paid for as medical care to employees or | 0004| their dependents as defined under the terms of the plan | 0005| directly or through insurance, reimbursement or otherwise; | 0006| ~~[R.]~~ Q. "group participation rule" means a | 0007| requirement relating to the minimum number of participants or | 0008| beneficiaries that must be enrolled in relation to a specified | 0009| percentage or number of eligible individuals or employees of | 0010| an employer; | 0011| ~~[S.]~~ R. "health insurance coverage" means | 0012| benefits consisting of medical care provided directly, through | 0013| insurance or reimbursement, or otherwise, and items, including | 0014| items and services paid for as medical care, pursuant to any | 0015| hospital or medical service policy or certificate, hospital or | 0016| medical service plan contract or health maintenance | 0017| organization contract offered by a health insurance issuer; | 0018| ~~[T.]~~ S. "health insurance issuer" means an | 0019| insurance company, insurance service or insurance | 0020| organization, including a health maintenance organization, | 0021| that is licensed to engage in the business of insurance in the | 0022| state and that is subject to state law that regulates | 0023| insurance within the meaning of Section 514(b)(2) of the | 0024| federal Employee Retirement Income Security Act of 1974, but | 0025| "health insurance issuer" does not include a group health | - 13 - 0001| plan; | 0002| ~~[U.]~~ T. "health maintenance organization" | 0003| means: | 0004| (1) a federally qualified health maintenance | 0005| organization; | 0006| (2) an organization recognized pursuant to | 0007| state law as a health maintenance organization; or | 0008| (3) a similar organization regulated pursuant | 0009| to state law for solvency in the same manner and to the same | 0010| extent as a health maintenance organization defined in | 0011| Paragraph (1) or (2) of this subsection; | 0012| ~~[V.]~~ U. "health status related factor" means | 0013| any of the factors described in Section 2702(a)(1) of the | 0014| federal Health Insurance Portability and Accountability Act of | 0015| 1996; | 0016| ~~[W.]~~ V. "individual health insurance coverage" | 0017| means health insurance coverage offered to an individual in | 0018| the individual market, but "individual health insurance | 0019| coverage" does not include short-term limited duration | 0020| insurance; | 0021| ~~[X.]~~ W. "individual market" means the market | 0022| for health insurance coverage offered to individuals other | 0023| than in connection with a group health plan; | 0024| ~~[Y.]~~ X. "large employer" means, in connection | 0025| with a group health plan and with respect to a calendar year | - 14 - 0001| and a plan year, an employer who employed an average of at | 0002| least fifty-one employees on business days during the | 0003| preceding calendar year and who employs at least two employees | 0004| on the first day of the plan year; | 0005| ~~[Z.]~~ Y. "large group market" means the health | 0006| insurance market under which individuals obtain health | 0007| insurance coverage on behalf of themselves and their | 0008| dependents through a group health plan maintained by a large | 0009| employer; | 0010| ~~[AA.]~~ Z. "late enrollee" means, with respect | 0011| to coverage under a group health plan, a participant or | 0012| beneficiary who enrolls under the plan other than during: | 0013| (1) the first period in which the individual | 0014| is eligible to enroll under the plan; or | 0015| (2) a special enrollment period pursuant to | 0016| Sections ~~[8 and 9 of the Health Insurance Portability Act]~~ | 0017| 59A-23E-8 and 59A-23E-9 NMSA 1978; | 0018| ~~[BB.]~~ AA. "medical care" means ~~[amounts paid~~ | 0019| ~~for]~~: | 0020| (1) services consisting of the diagnosis, | 0021| cure, mitigation, treatment or prevention of human disease | 0022| or provided for the purpose of affecting any structure or | 0023| function of the human body; and | 0024| (2) transportation services primarily for | 0025| and essential to ~~[medical care; and~~ | - 15 - 0001| ~~(3) insurance covering medical care]~~ | 0002| provision of the services described in Paragraph (1) of this | 0003| subsection; | 0004| ~~[CC.]~~ BB. "network plan" means health | 0005| insurance coverage of a health insurance issuer under which | 0006| the financing and delivery of medical care are provided | 0007| through a defined set of providers under contract with the | 0008| issuer; | 0009| ~~[DD.]~~ CC. "nonfederal governmental plan" means | 0010| a governmental plan that is not a federal governmental plan; | 0011| ~~[EE.]~~ DD. "participant" means: | 0012| (1) that term as defined in Section 3(7) of | 0013| the federal Employee Retirement Income Security Act of 1974; | 0014| (2) a partner in relationship to a | 0015| partnership in connection with a group health plan maintained | 0016| by the partnership; and | 0017| (3) a self-employed individual in connection | 0018| with a group health plan maintained by the self-employed | 0019| individual; | 0020| ~~[FF.]~~ EE. "placed for adoption" means a child | 0021| has been placed with a person who assumes and retains a legal | 0022| obligation for total or partial support of the child in | 0023| anticipation of adoption of the child; | 0024| ~~[GG.]~~ FF. "plan sponsor" means that term as | 0025| defined in Section 3(16)(B) of the federal Employee | - 16 - 0001| Retirement Income Security Act of 1974; | 0002| ~~[HH.]~~ GG. "preexisting condition exclusion" | 0003| means a limitation or exclusion of benefits relating to a | 0004| condition based on the fact that the condition was present | 0005| before the date of the coverage for the benefits whether or | 0006| not any medical advice, diagnosis, care or treatment was | 0007| recommended before that date, but genetic information is not | 0008| included as a preexisting condition for the purposes of | 0009| limiting or excluding benefits in the absence of a diagnosis | 0010| of the condition related to the genetic information; | 0011| ~~[II.]~~ HH. "small employer" means, in | 0012| connection with a group health plan and with respect to a | 0013| calendar year and a plan year, an employer who employed an | 0014| average of least two but not more than fifty employees on | 0015| business days during the preceding calendar year and who | 0016| employs at least two employees on the first day of the plan | 0017| year; | 0018| ~~[JJ.]~~ II. "small group market" means the | 0019| health insurance market under which individuals obtain health | 0020| insurance coverage through a group health plan maintained by a | 0021| small employer; | 0022| ~~[KK.]~~ JJ. "state law" means laws, decisions, | 0023| rules, regulations or state action having the effect of law; | 0024| and | 0025| ~~[LL.]~~ KK. "waiting period" means, with respect | - 17 - 0001| to a group health plan and an individual who is a potential | 0002| participant or beneficiary in the plan, the period that must | 0003| pass with respect to the individual before the individual is | 0004| eligible to be covered for benefits under the terms of the | 0005| plan." | 0006| Section 7. Section 59A-23E-3 NMSA 1978 (being Laws 1997, | 0007| Chapter 243, Section 3) is amended to read: | 0008| "59A-23E-3. GROUP HEALTH PLAN--GROUP HEALTH INSURANCE-- | 0009| LIMITATION ON PREEXISTING CONDITION EXCLUSION PERIOD-- | 0010| CREDITING FOR PERIODS OF PREVIOUS COVERAGE.--Except as | 0011| provided in Section ~~[4 of the Health Insurance Portability~~ | 0012| ~~Act]~~ 59A-23E-4 NMSA 1978, a group health plan and a health | 0013| insurance issuer offering group health insurance coverage may, | 0014| with respect to a participant or beneficiary, impose a | 0015| preexisting condition exclusion only if: | 0016| A. the exclusion relates to a condition, physical | 0017| or mental, regardless of the cause of the condition, for which | 0018| medical advice, diagnosis, care or treatment was recommended | 0019| or received within the six-month period ending on the | 0020| enrollment date; | 0021| B. the exclusion extends for a period of not more | 0022| than six months, or eighteen months in the case of a late | 0023| enrollee, after the enrollment date; and | 0024| C. the period of the exclusion is reduced by the | 0025| aggregate of the periods of creditable coverage applicable to | - 18 - 0001| the participant or beneficiary as of the enrollment date." | 0002| Section 8. Section 59A-23E-4 NMSA 1978 (being Laws 1997, | 0003| Chapter 243, Section 4) is amended to read: | 0004| "59A-23E-4. GROUP HEALTH PLAN--GROUP HEALTH INSURANCE-- | 0005| PROHIBITION OF EXCLUSIONS IN CERTAIN CASES.-- | 0006| A. A group health plan or a health insurer offering | 0007| group health insurance shall not impose a preexisting condition | 0008| exclusion: | 0009| (1) in the case of an individual who, as of | 0010| the last day of the thirty-day period beginning with the date | 0011| of birth, is covered under creditable coverage; | 0012| (2) that excludes a child who is adopted or | 0013| placed for adoption before his eighteenth birthday and who, as | 0014| of the last day of the thirty-day period beginning on and | 0015| following the date of the adoption or placement for adoption, | 0016| is covered under creditable coverage; or | 0017| (3) that relates to or includes pregnancy as | 0018| a preexisting condition. | 0019| B. The provisions of Paragraphs (1) and (2) of | 0020| Subsection A of this section do not apply to any individual | 0021| after the end of the first continuous sixty-three-day period | 0022| during which the individual was not covered under any | 0023| creditable coverage." | 0024| Section 9. Section 59A-23E-5 NMSA 1978 (being Laws 1997, | 0025| Chapter 243, Section 5) is amended to read: | - 19 - 0001| "59A-23E-5. GROUP HEALTH PLAN--RULES FOR CREDITING | 0002| PREVIOUS COVERAGE.-- | 0003| A. A period of creditable coverage shall not be | 0004| counted with respect to enrollment of an individual under a | 0005| group health plan if, after the period and before the | 0006| enrollment date, there was a sixty-three-day continuous period | 0007| during which the individual was not covered under any | 0008| creditable coverage. | 0009| B. In determining the continuous period for the | 0010| purpose of Subsection A of this section, any period that an | 0011| individual is in a waiting period for any coverage under a | 0012| group health plan or for group health insurance coverage or is | 0013| in an affiliation period shall not be counted." | 0014| Section 10. Section 59A-23E-6 NMSA 1978 (being Laws | 0015| 1997, Chapter 243, Section 6) is amended to read: | 0016| "59A-23E-6. GROUP HEALTH PLAN--GROUP HEALTH INSURANCE-- | 0017| METHOD OF CREDITING COVERAGE--ELECTION--NOTICE OF ELECTION.-- | 0018| A. Except as provided in Subsection B of this | 0019| section, for purposes of applying Subsection C of Section [3 | 0020| ~~of the Health Insurance Portability Act]~~ 59A-23E-3 NMSA 1978 | 0021| a group health plan and a health insurance issuer offering | 0022| group health insurance coverage shall count a period of | 0023| creditable coverage without regard to the specific benefits | 0024| covered during the period. | 0025| B. A group health plan or a health insurance issuer | - 20 - 0001| offering group health insurance coverage may elect to apply | 0002| Subsection C of Section ~~[3 of the Health Insurance Portability~~ | 0003| ~~Act]~~ 59A-23E-3 NMSA 1978 based on coverage of benefits | 0004| within each of several classes or categories of benefits | 0005| specified in regulations rather than as provided in Subsection | 0006| A of this section. The election shall be made uniformly for | 0007| all participants and beneficiaries. If the election is made, a | 0008| group health plan or an issuer shall count a period of | 0009| creditable coverage with respect to any class or category of | 0010| benefits if any level of benefits is covered within the class | 0011| or category. | 0012| C. A group health plan making an election pursuant | 0013| to Subsection B of this section, whether or not health | 0014| insurance coverage is provided in connection with the plan, | 0015| shall: | 0016| (1) prominently state in disclosure | 0017| statements concerning the plan, and state to each enrollee at | 0018| the time of enrollment under the plan, that the plan has made | 0019| the election; and | 0020| (2) include in the statements made a | 0021| description of the effect of this election. | 0022| D. A health insurance issuer offering group health | 0023| insurance coverage in the small or large group market making an | 0024| election pursuant to Subsection B of this section shall: | 0025| (1) prominently state in disclosure | - 21 - 0001| statements concerning the coverage, and state to each employer | 0002| at the time of the offer or sale of the coverage, that the | 0003| issuer has made the election; and | 0004| (2) include in the statements made a | 0005| description of the effect of this election." | 0006| Section 11. Section 59A-23E-7 NMSA 1978 (being Laws | 0007| 1997, Chapter 243, Section 7) is amended to read: | 0008| "59A-23E-7. GROUP HEALTH PLAN--GROUP HEALTH INSURANCE-- | 0009| CERTIFICATION AND DISCLOSURE OF COVERAGE.-- | 0010| A. Periods of creditable coverage with respect to | 0011| an individual shall be established through the certification | 0012| required by this section. A group health plan and a health | 0013| insurance issuer offering group health insurance coverage shall | 0014| provide the certification described in Subsection B of this | 0015| section: | 0016| (1) at the time an individual ceases to be | 0017| covered under the plan or otherwise becomes covered under a | 0018| COBRA continuation provision, to the extent practicable, at a | 0019| time consistent with notices required pursuant to any COBRA | 0020| continuation provision; | 0021| (2) in the case of an individual becoming | 0022| covered under a COBRA continuation provision, at the time the | 0023| individual ceases to be covered under that provision; and | 0024| (3) on the request on behalf of an individual | 0025| made not later than twenty-four months after the date of | - 22 - 0001| cessation of the coverage described in Paragraph (1) or (2) of | 0002| this subsection, whichever is later. | 0003| B. The required certification is a written | 0004| certification of: | 0005| (1) the period of creditable coverage of the | 0006| individual under the plan and the coverage, if any, under the | 0007| COBRA continuation provision; and | 0008| (2) the waiting period, if any, and | 0009| affiliation period, if applicable, imposed with respect to the | 0010| individual for any coverage under the plan. | 0011| C. To the extent that medical care pursuant to a | 0012| group health plan ~~[consists of]~~ is provided pursuant to | 0013| group health insurance coverage, the plan satisfies the | 0014| certification requirement of this section if the health | 0015| insurance issuer offering the coverage provides for the | 0016| certification pursuant to this section. | 0017| D. If a group health plan or health insurance | 0018| issuer that has made an election pursuant to Subsection B of | 0019| Section ~~[6 of the Health Insurance Portability Act]~~ 59A-23E- | 0020| 6 NMSA 1978 enrolls an individual for coverage under the plan | 0021| or insurance and the individual provides a certification | 0022| pursuant to this section, the entity providing the individual | 0023| that certification: | 0024| (1) shall upon request of the plan or issuer | 0025| promptly disclose to the requester information on coverage of | - 23 - 0001| classes and categories of health benefits available under the | 0002| entity's plan or coverage; and | 0003| (2) may charge the requesting plan or issuer | 0004| the reasonable cost of disclosing the required information." | 0005| Section 12. Section 59A-23E-8 NMSA 1978 (being Laws | 0006| 1997, Chapter 243, Section 8) is amended to read: | 0007| "59A-23E-8. GROUP HEALTH PLAN--GROUP HEALTH INSURANCE-- | 0008| SPECIAL ENROLLMENT PERIODS FOR INDIVIDUALS LOSING OTHER | 0009| COVERAGE.--A group health plan and a health insurance issuer | 0010| offering group health insurance coverage in connection with a | 0011| group health plan shall permit an employee who is eligible but | 0012| not enrolled for coverage under the terms of the plan, or a | 0013| dependent of the employee if the dependent is eligible but not | 0014| enrolled for coverage, to enroll for coverage under the terms | 0015| of the plan if: | 0016| A. the employee or dependent was covered under a | 0017| group health plan or had health insurance coverage at the time | 0018| coverage was previously offered to the employee or dependent; | 0019| B. the employee stated in writing at the time | 0020| coverage was offered that coverage under a group health plan or | 0021| health insurance coverage was the reason for declining | 0022| enrollment, but only if the plan sponsor or issuer required | 0023| such a statement at the time and provided the employee with | 0024| notice of that requirement and the consequences of the | 0025| requirement at the time; | - 24 - 0001| C. the employee's or dependent's coverage described | 0002| in Subsection A of this section was: | 0003| (1) ~~[was]~~ under a COBRA continuation | 0004| provision and the coverage under that provision was exhausted; | 0005| or | 0006| (2) ~~[was]~~ not under a COBRA continuation | 0007| provision and either the coverage was terminated as a result of | 0008| loss of eligibility for the coverage, including as a result of | 0009| legal separation, divorce, death, termination of employment or | 0010| reduction in the number of hours of employment, or employer | 0011| contributions toward the coverage were terminated; and | 0012| D. under the terms of the plan, the employee | 0013| requested enrollment not later than thirty days after the date | 0014| of exhaustion of coverage described in Paragraph (1) of | 0015| Subsection C of this section or termination of coverage or | 0016| employer contribution described in Paragraph (2) of Subsection | 0017| C of this section." | 0018| Section 13. Section 59A-23E-9 NMSA 1978 (being Laws | 0019| 1997, Chapter 243, Section 9) is amended to read: | 0020| "59A-23E-9. GROUP HEALTH PLAN--SPECIAL ENROLLMENT | 0021| PERIODS FOR DEPENDENT BENEFICIARIES.-- | 0022| A. A group health plan shall provide for a | 0023| dependent special enrollment period described in Subsection B | 0024| of this section during which a person ~~[or if not otherwise~~ | 0025| ~~enrolled, the individual]~~ may be enrolled under the plan as a | - 25 - 0001| dependent of the individual, and in the case of the birth or | 0002| adoption of a child, the spouse of the individual may be | 0003| enrolled as a dependent of the individual if the spouse is | 0004| otherwise eligible for coverage, if: | 0005| (1) the plan makes coverage available to a | 0006| dependent of an individual; | 0007| (2) the individual is a participant under the | 0008| plan or has met any waiting period applicable to becoming a | 0009| participant and is eligible to be enrolled under the plan but | 0010| for a failure to enroll during a previous enrollment period; | 0011| and | 0012| (3) ~~[a]~~ the person has become the | 0013| dependent of the individual through marriage, birth, adoption | 0014| or placement for adoption. | 0015| B. A dependent special enrollment period pursuant | 0016| to this subsection shall be for a period of not less than | 0017| thirty days and shall begin on the later of: | 0018| (1) the date dependent coverage is made | 0019| available; or | 0020| (2) the date of the marriage, birth, adoption | 0021| or placement for adoption described in Subsection A of this | 0022| section. | 0023| C. If an individual seeks to enroll a person as a | 0024| dependent during the first thirty days of a dependent special | 0025| enrollment period, the coverage of the dependent becomes | - 26 - 0001| effective: | 0002| (1) in the case of marriage, not later than | 0003| the first day of the first month beginning after the date the | 0004| completed request for enrollment is received; | 0005| (2) in the case of ~~[a dependent's]~~ birth, | 0006| as of the date of the birth; or | 0007| (3) in the case of ~~[a dependent's]~~ adoption | 0008| or placement for adoption, the date of the adoption or | 0009| placement." | 0010| Section 14. Section 59A-23E-10 NMSA 1978 (being Laws | 0011| 1997, Chapter 243, Section 10) is amended to read: | 0012| "59A-23E-10. GROUP HEALTH PLAN--GROUP HEALTH INSURANCE- | 0013| -USE OF AFFILIATION PERIOD BY HEALTH MAINTENANCE ORGANIZATIONS | 0014| AS ALTERNATIVE TO PREEXISTING CONDITION EXCLUSION.-- | 0015| A. A health maintenance organization that offers | 0016| health insurance coverage in connection with a group health | 0017| plan and does not impose any preexisting condition exclusion | 0018| allowed pursuant to Section ~~[3 of the Health Insurance~~ | 0019| ~~Portability Act]~~ 59A-23E-3 NMSA 1978 with respect to any | 0020| particular coverage option may impose an affiliation period for | 0021| the coverage option if that period: | 0022| (1) is applied uniformly without regard to | 0023| any health status related factors; and | 0024| (2) does not exceed two months, or three | 0025| months in the case of a late enrollee. | - 27 - 0001| B. During an affiliation period, a health | 0002| maintenance organization is not required to provide health care | 0003| services or benefits to a participant or beneficiary, and it | 0004| shall not charge a premium to a participant or beneficiary for | 0005| any coverage. | 0006| C. An affiliation period begins to run on the | 0007| enrollment date and shall run concurrently with any waiting | 0008| period under the plan. | 0009| D. A health maintenance organization described in | 0010| Subsection A of this section may use alternative methods | 0011| different from those described in that subsection to address | 0012| adverse selection as approved by the superintendent." | 0013| Section 15. Section 59A-23E-11 NMSA 1978 (being Laws | 0014| 1997, Chapter 243, Section 11) is amended to read: | 0015| "59A-23E-11. GROUP HEALTH PLAN--GROUP HEALTH INSURANCE- | 0016| -PROHIBITING DISCRIMINATION BASED ON HEALTH STATUS AGAINST | 0017| INDIVIDUAL PARTICIPANTS AND BENEFICIARIES IN ELIGIBILITY TO | 0018| ENROLL.-- | 0019| A. Except as provided in Subsection B of this | 0020| section, a group health plan and a health insurance issuer | 0021| offering group health insurance coverage in connection with a | 0022| group health plan shall not establish rules for eligibility or | 0023| continued eligibility of any individual to enroll or continue | 0024| to participate in a health plan based on any of the following | 0025| health status related factors in relation to the individual or | - 28 - 0001| a dependent of the individual: | 0002| (1) health status; | 0003| (2) medical condition, including both | 0004| physical and mental illnesses; | 0005| (3) claims experience; | 0006| (4) receipt of health care; | 0007| (5) medical history; | 0008| (6) genetic information; | 0009| (7) evidence of insurability, including | 0010| conditions arising out of acts of domestic violence; or | 0011| (8) disability. | 0012| B. To the extent consistent with the provisions of | 0013| Section ~~[3 of the Health Insurance Portability Act]~~ 59A-23E- | 0014| 3 NMSA 1978, the provisions of Subsection A of this section do | 0015| not require a group health plan or group health insurance | 0016| coverage to provide particular benefits other than those | 0017| provided under the terms of the plan or coverage or to prevent | 0018| the plan or coverage from establishing limitations or | 0019| restrictions on the amount, level, extent or nature of the | 0020| benefits or coverage for similarly situated individuals | 0021| enrolled in the plan or coverage." | 0022| Section 16. Section 59A-23E-12 NMSA 1978 (being Laws | 0023| 1997, Chapter 243, Section 12) is amended to read: | 0024| "59A-23E-12. GROUP HEALTH PLAN--GROUP HEALTH INSURANCE- | 0025| -PROHIBITING DISCRIMINATION BASED ON HEALTH STATUS AGAINST | - 29 - 0001| INDIVIDUAL PARTICIPANTS AND BENEFICIARIES IN PREMIUM | 0002| CONTRIBUTIONS.-- | 0003| A. Except as provided in Subsection B of this | 0004| section, a group health plan and a health insurance issuer | 0005| offering group health insurance coverage in connection with a | 0006| group health plan shall not require an individual as a | 0007| condition to enroll or continue to participate in a health plan | 0008| to pay a premium or contribution that is greater than the | 0009| premium or contribution for a similarly situated individual | 0010| enrolled in the plan on the basis of the health status related | 0011| factors specified in Subsection A of Section ~~[11 of the Health~~ | 0012| ~~Insurance Portability Act]~~ 59A-23E-11 NMSA 1978 in relation | 0013| to the individual or ~~[an individual]~~ a person enrolled | 0014| under the plan as a dependent of the individual. | 0015| B. The provisions of Subsection A of this section | 0016| do not restrict the amount that an employer may be charged for | 0017| coverage under a group health plan and do not prevent a group | 0018| health plan or a health insurance issuer offering group health | 0019| insurance coverage from establishing premium discounts or | 0020| rebates or modifying otherwise applicable copayments or | 0021| deductibles in return for adherence to programs of health | 0022| promotion and disease prevention." | 0023| Section 17. Section 59A-23E-13 NMSA 1978 (being Laws | 0024| 1997, Chapter 243, Section 13) is amended to read: | 0025| "59A-23E-13. HEALTH INSURANCE ISSUERS--GUARANTEED | - 30 - 0001| AVAILABILITY OF COVERAGE FOR EMPLOYERS IN SMALL GROUP | 0002| MARKET--EXCEPTIONS FOR NETWORK PLANS, INSUFFICIENT FINANCIAL | 0003| CAPACITY AND BONA FIDE ASSOCIATIONS--EMPLOYER CONTRIBUTION | 0004| RULES.-- | 0005| A. Except as provided in Subsections B through G of | 0006| this section, a health insurance issuer that offers health | 0007| insurance coverage in the small group market shall: | 0008| (1) accept a small employer that applies for | 0009| coverage; | 0010| (2) accept for enrollment under the offered | 0011| coverage an eligible individual who applies for enrollment | 0012| during the period in which the individual first becomes | 0013| eligible to enroll under the terms of the group health plan; | 0014| and | 0015| (3) not place a restriction on an eligible | 0016| individual being a participant or a beneficiary that is | 0017| inconsistent with Sections ~~[11 and 12 of the of the Health~~ | 0018| ~~Insurance Portability Act]~~ 59A-23E-11 and 59A-23E-12 NMSA | 0019| 1978. | 0020| B. A health insurance issuer that offers health | 0021| insurance coverage in the small group market through a network | 0022| plan may: | 0023| (1) limit the employers that may apply for | 0024| the coverage to those with eligible individuals who live, work | 0025| or reside in the service area for the network plan; and | - 31 - 0001| (2) deny coverage to employers within the | 0002| service area for the network plan if the issuer has | 0003| demonstrated to the superintendent that it: | 0004| (a) will not have the capacity to | 0005| deliver services adequately to enrollees of any additional | 0006| groups because of its obligations to existing group contract | 0007| holders and enrollees; and | 0008| (b) is applying this exception uniformly | 0009| to all employers without regard to the claims experience of | 0010| those employers, their employees and their dependents or any | 0011| health status related factor relating to those employees and | 0012| dependents. | 0013| C. A health insurance issuer, upon denying | 0014| insurance coverage in any service area pursuant to the | 0015| provisions of Subsection B of this section, shall not offer | 0016| coverage in the small group market within the service area for | 0017| a period of one hundred eighty days after the date coverage is | 0018| denied. | 0019| D. A health insurance issuer may deny health | 0020| insurance coverage in the small group market if the issuer has | 0021| demonstrated to the superintendent that it: | 0022| (1) does not have the financial reserves | 0023| necessary to underwrite additional coverage; and | 0024| (2) is applying this exception uniformly to | 0025| all employers in the small group market in the state consistent | - 32 - 0001| with state law and without regard to the claims experience of | 0002| those employers, their employees and their dependents or any | 0003| health status related factor relating to those employees and | 0004| dependents. | 0005| E. A health insurance issuer upon denying health | 0006| insurance coverage in connection with group health plans | 0007| pursuant to Subsection D of this section shall not offer | 0008| coverage in connection with group health plans in the small | 0009| group market in the state for a period of one hundred eighty | 0010| days after the date coverage is denied or until the issuer has | 0011| demonstrated to the superintendent that the issuer has | 0012| sufficient financial reserves to underwrite the additional | 0013| coverage, whichever is later. The superintendent may provide | 0014| for the application of this subsection on a service-area- | 0015| specific basis. | 0016| F. The requirement of Subsection A of this section | 0017| does not apply to health insurance coverage offered by a health | 0018| insurance issuer if the coverage is made available in the small | 0019| group market only through one or more bona fide associations. | 0020| G. Subsection A of this section does not preclude a | 0021| health insurance issuer from establishing employer contribution | 0022| rules or group participation rules for the offering of health | 0023| insurance coverage in connection with a group health plan in | 0024| the small group market. | 0025| H. As used in this section, "eligible individual" | - 33 - 0001| means, with respect to a health insurance issuer that offers | 0002| health insurance coverage to a small employer in connection | 0003| with a group health plan in the small group market, an | 0004| individual whose eligibility shall be determined: | 0005| (1) in accordance with the terms of the plan; | 0006| (2) as provided by the issuer under the rules | 0007| of the issuer that are uniformly applicable in the state to | 0008| small employers in the small group market; and | 0009| (3) in accordance with Insurance Code | 0010| provisions governing the issuer and the small group market." | 0011| Section 18. Section 59A-23E-14 NMSA 1978 (being Laws | 0012| 1997, Chapter 243, Section 14) is amended to read: | 0013| "59A-23E-14. HEALTH INSURANCE ISSUERS--GUARANTEED | 0014| RENEWABILITY OF COVERAGE FOR EMPLOYERS IN THE SMALL OR LARGE | 0015| GROUP MARKET--REQUIREMENT AND EXCEPTIONS TO REQUIREMENT.-- | 0016| A. Except as provided in Subsections B through G of | 0017| this section, a health insurance issuer that offers health | 0018| insurance coverage in the small or large group market in | 0019| connection with a group health plan shall renew or continue | 0020| that coverage in force at the option of the plan sponsor of the | 0021| plan. | 0022| B. A health insurance issuer may ~~[nonrenew]~~ | 0023| refuse to renew or may discontinue health insurance | 0024| coverage offered pursuant to Subsection A of this section if: | 0025| (1) the plan sponsor has failed to pay | - 34 - 0001| premiums or contributions in accordance with the terms of the | 0002| health insurance coverage or the issuer has not received timely | 0003| premium payments; | 0004| (2) the plan sponsor has performed an act or | 0005| practice that constitutes fraud or made an intentional | 0006| misrepresentation of a material fact under the terms of the | 0007| coverage; | 0008| (3) the plan sponsor has failed to comply | 0009| with a material plan provision relating to employer | 0010| contribution or group participation rules permitted pursuant to | 0011| Subsection G of Section ~~[13 of the Health Insurance~~ | 0012| ~~Portability Act]~~ 59A-23E-13 NMSA 1976; | 0013| (4) the issuer is ceasing to offer coverage | 0014| in the market in accordance with Subsection C of this section; | 0015| (5) in the case of a health insurance issuer | 0016| that offers health insurance coverage in the market through a | 0017| network plan, there is no longer any enrollee in connection | 0018| with that plan who lives, resides or works in the service area | 0019| of the issuer or the area for which the issuer is authorized to | 0020| do business and, in the case of the small group market, the | 0021| issuer would deny enrollment with respect to the network plan | 0022| pursuant to Paragraph (1) of Subsection B of Section ~~[13 of~~ | 0023| ~~the Health Insurance Portability Act]~~ 59A-23E-13 NMSA 1978; | 0024| or | 0025| (6) in the case of health insurance coverage | - 35 - 0001| that is made available only through one or more bona fide | 0002| associations, the membership of any employer in the association | 0003| ceases, but only if the coverage is terminated pursuant to this | 0004| paragraph uniformly without regard to any health status related | 0005| factor relating to a covered individual. | 0006| C. A health insurance issuer may discontinue | 0007| offering a particular type of group health insurance coverage | 0008| offered in the small or large group market only if: | 0009| (1) the issuer provides notice to each plan | 0010| sponsor provided coverage of this type in the market and to the | 0011| participants and beneficiaries covered under the coverage of | 0012| the discontinuation at least ninety days prior to the date of | 0013| the discontinuation; | 0014| (2) the issuer offers to a plan sponsor | 0015| provided coverage of this type in the market the option to | 0016| purchase all, or in the case of the large group market, any, | 0017| other health insurance coverage currently being offered by the | 0018| issuer to a group health plan in that market; and | 0019| (3) in exercising the option to discontinue | 0020| coverage of this type and in offering the option of coverage | 0021| pursuant to Paragraph (2) of this subsection, the issuer acts | 0022| uniformly without regard to the claims experience of those | 0023| sponsors or any health status related factors relating to any | 0024| participants or beneficiaries who may become eligible for that | 0025| coverage. | - 36 - 0001| D. If a health insurance issuer elects to | 0002| discontinue offering all health insurance coverage in the small | 0003| group market or the large group market, coverage may be | 0004| discontinued only if: | 0005| (1) the issuer provides notice to the | 0006| superintendent and to each plan sponsor and to participants and | 0007| beneficiaries covered under the plan of the discontinuation at | 0008| least one hundred eighty days prior to the date of | 0009| discontinuation; and | 0010| (2) all health insurance issued or delivered | 0011| for issuance in the state in the market is discontinued and | 0012| coverage is not renewed. | 0013| E. After discontinuation pursuant to Subsection D | 0014| of this section, the health insurance issuer shall not provide | 0015| for the issuance of any health insurance coverage in the market | 0016| involved during the five-year period beginning on the date of | 0017| the discontinuation of the last health insurance coverage not | 0018| renewed. | 0019| F. At the time of coverage renewal pursuant to | 0020| Subsection A of this section, a health insurance issuer may | 0021| modify the coverage for a product offered to a group health | 0022| plan: | 0023| (1) in the large group market; or | 0024| (2) in the small group market if, for | 0025| coverage available in that market other than through a bona | - 37 - 0001| fide association, the modification is effective on a uniform | 0002| basis among group health plans with that product. | 0003| G. If health insurance coverage is made available | 0004| by a health insurance issuer in the small or large group market | 0005| to employers only through one or more associations, a reference | 0006| to "plan sponsor" is deemed, with respect to coverage provided | 0007| to an employer member of the association, to include a | 0008| reference to that employer." | 0009| Section 19. Section 59A-23E-15 NMSA 1978 (being Laws | 0010| 1997, Chapter 243, Section 15) is amended to read: | 0011| "59A-23E-15. DISCLOSURE OF INFORMATION BY HEALTH | 0012| INSURANCE ISSUERS--OFFERING HEALTH INSURANCE COVERAGE TO SMALL | 0013| EMPLOYERS.-- | 0014| A. A health insurance issuer when offering health | 0015| insurance coverage to a small employer shall: | 0016| (1) make a reasonable disclosure to the small | 0017| employer, as part of its solicitation and sales materials, of | 0018| the availability of information described in Subsection B of | 0019| this section; and | 0020| (2) upon request of the small employer | 0021| provide the information described. | 0022| B. Except as provided in Subsection D of this | 0023| section, a health insurance issuer shall provide information | 0024| pursuant to Subsection A of this section concerning: | 0025| (1) the provisions of coverage concerning the | - 38 - 0001| issuer's right to change premium rates and the factors that may | 0002| affect changes in premium rates; | 0003| (2) the provisions of coverage relating to | 0004| renewability of coverage; | 0005| (3) the provisions of the coverage relating | 0006| to preexisting condition exclusions; and | 0007| (4) the benefits and premiums available under | 0008| all health insurance coverage for which the small employer is | 0009| qualified. | 0010| C. Information furnished pursuant to this section | 0011| shall be provided to small employers in a manner determined to | 0012| be understandable by the average small employer and shall be | 0013| sufficient to reasonably inform small employers of their rights | 0014| and obligations under the health insurance coverage. | 0015| D. A health insurance issuer is not required by | 0016| this section to disclose information that is proprietary and | 0017| trade secret information." | 0018| Section 20. Section 59A-23E-16 NMSA 1978 (being Laws | 0019| 1997, Chapter 243, Section 16) is amended to read: | 0020| "59A-23E-16. EXCLUSIONS, LIMITATIONS AND EXCEPTIONS FOR | 0021| CERTAIN GROUP HEALTH PLANS AND GROUP HEALTH INSURANCE.-- | 0022| A. The requirements of Sections ~~[3 through 15 of~~ | 0023| ~~the Health Insurance Portability Act]~~ 59A-23E-3 through | 0024| 59A-23E-15 NMSA 1978 do not apply to any group health plan and | 0025| health insurance coverage offered in connection with a group | - 39 - 0001| health plan if, on the first day of the plan year, the plan has | 0002| ~~[less]~~ fewer than two employees who are current employees. | 0003| B. The requirements of Sections ~~[3 through 15 of~~ | 0004| ~~the Health Insurance Portability Act]~~ 59A-23E-3 through | 0005| 59A-23E-15 NMSA 1978 shall not apply with respect to a group | 0006| health plan that is a nonfederal governmental plan if the plan | 0007| sponsor makes an election under the provisions of this | 0008| subsection in conformity with regulations of the federal | 0009| secretary of health and human services. The period of an | 0010| election for exclusion made pursuant to this subsection is for | 0011| a single specified plan year or, in the case of a plan provided | 0012| pursuant to a collective bargaining agreement, for the term of | 0013| the agreement. The plan for which an election is made shall | 0014| provide under the terms of the election for: | 0015| (1) notice to enrollees on an annual basis | 0016| and at the time of enrollment of the facts and consequences of | 0017| the election; and | 0018| (2) certification and disclosure of | 0019| creditable coverage under the plan with respect to enrollees in | 0020| accordance with Section ~~[7 of the Health Insurance Portability~~ | 0021| ~~Act]~~ 59A-23E-7 NMSA 1978. | 0022| C. The requirements of Sections ~~[3 through 15 of~~ | 0023| ~~the Health Insurance Portability Act]~~ 59A-23E-3 through | 0024| 59A-23E-15 NMSA 1978 do not apply to a group health plan and | 0025| group health insurance coverage offered in connection with a | - 40 - 0001| group health plan in relation to its provision of excepted | 0002| benefits described in Paragraph (9) of Subsection ~~[M]~~ L of | 0003| Section ~~[2 of the Health Insurance Portability Act]~~ 59A-23E- | 0004| 2 NMSA 1978 if the benefits are: | 0005| (1) provided under a separate policy, | 0006| certificate or contract of insurance; or | 0007| (2) otherwise not an integral part of the | 0008| plan. | 0009| D. The requirements of Sections ~~[3 through 15 of~~ | 0010| ~~the Health Insurance Portability Act]~~ 59A-23E-3 through | 0011| 59A-23E-15 NMSA 1978 do not apply to any group health plan and | 0012| group health insurance coverage offered in connection with a | 0013| group health plan in relation to its provision of excepted | 0014| benefits described in Paragraph (10) of Subsection ~~[M]~~ L of | 0015| Section ~~[2 of the Health Insurance Portability Act]~~ 59A-23E- | 0016| 2 NMSA 1978 if: | 0017| (1) the benefits are provided under a | 0018| separate policy, certificate or contract of insurance; | 0019| (2) there is no coordination between the | 0020| provision of the benefits and any exclusion of benefits under | 0021| any group health plan maintained by the same plan sponsor; | 0022| and | 0023| (3) the benefits are paid with respect to an | 0024| event without regard to whether benefits are provided with | 0025| respect to that event under any group health plan maintained by | - 41 - 0001| the same plan sponsor. | 0002| E. The requirements of Sections ~~[3 through 15 of~~ | 0003| ~~the Health Insurance Portability Act]~~ 59A-23E-3 through | 0004| 59A-23E-15 NMSA 1978 do not apply to any group health plan and | 0005| group health insurance coverage offered in connection with a | 0006| group health plan in relation to its provision of excepted | 0007| benefits described in Paragraph (11) of Subsection ~~[M]~~ L of | 0008| Section ~~[2 of the Health Insurance Portability Act]~~ 59A-23E- | 0009| 2 NMSA 1978 if the benefits are provided under a separate | 0010| policy, certificate or contract of insurance." | 0011| Section 21. Section 59A-23E-17 NMSA 1978 (being Laws | 0012| 1997, Chapter 243, Section 17) is amended to read: | 0013| "59A-23E-17. TREATMENT OF ~~[PARTNERSHIPS]~~ PARTNERS | 0014| AND SELF-EMPLOYED INDIVIDUALS IN CONNECTION WITH GROUP HEALTH | 0015| PLANS.-- | 0016| A. Any plan, fund or program that would not be an | 0017| employee welfare benefit plan, except for the provisions of | 0018| this section, that is established or maintained by a | 0019| partnership, to the extent that the plan, fund or program | 0020| provides medical care to current or former partners in the | 0021| partnership or to their dependents directly or through | 0022| insurance, reimbursement or otherwise, shall be treated as an | 0023| employee welfare benefit plan that is a group health plan. | 0024| B. As used in this section: | 0025| (1) "employer" includes a partnership in | - 42 - 0001| relation to a partner; and | 0002| (2) "participant" includes: | 0003| (a) in connection with a group health | 0004| plan maintained by a partnership, an individual who is a | 0005| partner in relationship to the partnership; and | 0006| (b) in connection with a group health | 0007| plan maintained by a self-employed individual under which one | 0008| or more employees are participants, the self-employed | 0009| individual, if he or his beneficiaries are or may become | 0010| eligible to receive a benefit under the plan." | 0011| Section 22. A new Section 59A-23E-18 NMSA 1978 is | 0012| enacted to read: | 0013| "59A-23E-18. [NEW MATERIAL] PARITY IN THE APPLICATION | 0014| OF CERTAIN LIMITS TO MENTAL HEALTH BENEFITS OFFERED IN GROUP | 0015| HEALTH PLANS OR GROUP HEALTH INSURANCE--DEFINITIONS.-- | 0016| A. If a group health plan or group health insurance | 0017| coverage offered in connection with the plan provides both | 0018| medical and surgical benefits and mental health benefits: | 0019| (1) it may not impose an aggregate lifetime | 0020| limit on mental health benefits if it does not impose an | 0021| aggregate lifetime limit on substantially all medical and | 0022| surgical benefits; | 0023| (2) it may not impose an annual limit on | 0024| mental health benefits if it does not impose an annual limit on | 0025| substantially all medical and surgical benefits; | - 43 - 0001| (3) if it includes an aggregate lifetime limit | 0002| on substantially all medical and surgical benefits, it shall | 0003| either: | 0004| (a) apply the aggregate lifetime limit | 0005| both to the medical and surgical benefits to which it otherwise | 0006| would apply and to mental health benefits and not distinguish | 0007| in the application of the limit between medical and surgical | 0008| benefits and mental health benefits; or | 0009| (b) not include an aggregate lifetime | 0010| limit on mental health benefits that is less than the aggregate | 0011| lifetime limit imposed on medical and surgical benefits; | 0012| (4) if it includes an annual limit on | 0013| substantially all medical and surgical benefits, it shall | 0014| either: | 0015| (a) apply the annual limit both to the | 0016| medical and surgical benefits to which it otherwise would apply | 0017| and to mental health benefits and not distinguish in the | 0018| application of the limit between medical and surgical benefits | 0019| and mental health benefits; or | 0020| (b) not include an annual limit on mental | 0021| health benefits that is less than the annual limit imposed on | 0022| medical and surgical benefits; and | 0023| (5) if it includes no or different aggregate | 0024| lifetime limits or annual limits on different categories of | 0025| medical and surgical benefits, it shall comply with rules | - 44 - 0001| established by the federal secretary of health and human | 0002| services, which rules shall apply the provisions of | 0003| Subparagraphs (a) or (b) of Paragraph (3) or (4) of this | 0004| subsection, respectively, by substituting for the aggregate | 0005| lifetime limit or annual limit an average aggregate lifetime | 0006| limit or average annual limit, respectively, that is computed | 0007| by taking into account the weighted average of the aggregate | 0008| lifetime limits or annual limits applicable to the categories. | 0009| B. Nothing in this section: | 0010| (1) requires a group health plan, or group | 0011| health insurance coverage offered in connection with the plan, | 0012| to provide any mental health benefits; or | 0013| (2) in the case of a group health plan, or | 0014| group health insurance coverage offered in connection with the | 0015| plan, that provides mental health benefits, affects the terms | 0016| and conditions relating to the amount, duration or scope of | 0017| mental health benefits under the plan or coverage except as | 0018| provided specifically in Subsection A of this section. | 0019| C. The provisions of this section do not apply to a | 0020| group health plan, or group health insurance coverage offered | 0021| in connection with the plan, for a plan year of a small | 0022| employer. | 0023| D. The provisions of this section do not apply to a | 0024| group health plan, or group health insurance coverage offered | 0025| in connection with the plan, if the application of the | - 45 - 0001| provisions results in an increase in cost under the plan of at | 0002| least one percent. | 0003| E. If a group health plan offers a participant or | 0004| beneficiary two or more benefit package options under the plan, | 0005| the requirements of this section shall be applied separately | 0006| for each option. | 0007| F. As used in this section: | 0008| (1) "aggregate lifetime limit" means a dollar | 0009| limitation on the total amount that may be paid for benefits | 0010| under a group health plan or group health insurance coverage | 0011| for an individual or other coverage unit; | 0012| (2) "annual limit" means a dollar limitation | 0013| on the total amount that may be paid for benefits in a twelve- | 0014| month period under a group health plan or group health | 0015| insurance coverage for an individual or other coverage unit; | 0016| (3) "medical or surgical benefits" means | 0017| benefits with respect to medical or surgical services, as | 0018| defined under the terms of a group health plan or group health | 0019| insurance coverage for an individual or other coverage unit, | 0020| but does not include mental health benefits; and | 0021| (4) "mental health benefits" means benefits | 0022| with respect to mental health services, as defined under the | 0023| terms of a group health plan or group health insurance coverage | 0024| for an individual or other coverage unit, but the term does not | 0025| include benefits with respect to treatment of substance abuse | - 46 - 0001| or chemical dependency." | 0002| Section 23. A new Section 59A-23E-19 NMSA 1978 is | 0003| enacted to read: | 0004| "59A-23E-19. [NEW MATERIAL] INDIVIDUAL HEALTH | 0005| INSURANCE COVERAGE--GUARANTEED RENEWABILITY--EXCEPTIONS.-- | 0006| A. Except as otherwise provided in this section, a | 0007| health insurance issuer that provides individual health | 0008| insurance coverage to an individual shall renew or continue | 0009| that coverage in force at the option of the individual. | 0010| B. A health insurance issuer may refuse to renew or | 0011| discontinue health insurance coverage of an individual in the | 0012| individual market if: | 0013| (1) the individual has failed to pay premiums | 0014| or contributions in accordance with the terms of the health | 0015| insurance coverage or the issuer has not received timely | 0016| premium payments; | 0017| (2) the individual has performed an act or | 0018| practice that constitutes fraud or has made an intentional | 0019| misrepresentation of a material fact under the terms of the | 0020| coverage; | 0021| (3) the issuer is ceasing to offer coverage in | 0022| the individual market in accordance with Subsection C of this | 0023| section; | 0024| (4) in the case of a health insurance issuer | 0025| that offers health insurance coverage in the market through a | - 47 - 0001| network plan, the individual no longer lives, resides or works | 0002| in the service area of the issuer or the area for which the | 0003| issuer is authorized to do business but only if the coverage is | 0004| terminated pursuant to this paragraph uniformly without regard | 0005| to any health status related factor of covered individuals; and | 0006| (5) in the case of health insurance coverage | 0007| that is made available to the individual market only through | 0008| one or more bona fide associations, the membership of the | 0009| individual in the association on the basis of which the | 0010| coverage is provided ceases, but only if the coverage is | 0011| terminated pursuant to this paragraph uniformly without regard | 0012| to any health status related factor of covered individuals. | 0013| C. A health insurance issuer may discontinue | 0014| offering a particular type of group health insurance coverage | 0015| offered in the individual market only if: | 0016| (1) the issuer provides notice to each covered | 0017| individual provided coverage of this type in the market of the | 0018| discontinuation at least ninety days prior to the date of the | 0019| discontinuation; | 0020| (2) the issuer offers to each individual in | 0021| the individual market provided coverage of this type the option | 0022| to purchase any other individual health insurance coverage | 0023| currently being offered by the issuer for individuals in that | 0024| market; and | 0025| (3) in exercising the option to discontinue | - 48 - 0001| coverage of this type and in offering the option of coverage | 0002| pursuant to Paragraph (2) of this subsection, the issuer acts | 0003| uniformly without regard to any health status related factor of | 0004| enrolled individuals or individuals who may become eligible for | 0005| that coverage. | 0006| D. If a health insurance issuer elects to | 0007| discontinue offering all health insurance coverage, the | 0008| individual coverage may be discontinued only if: | 0009| (1) the issuer provides notice to the | 0010| superintendent and to each individual of the discontinuation at | 0011| least one hundred eighty days prior to the date of the | 0012| expiration of the coverage; and | 0013| (2) all health insurance issued or delivered | 0014| for issuance in the state in the market is discontinued and | 0015| coverage is not renewed. | 0016| E. After discontinuation pursuant to Subsection D | 0017| of this section, the health insurance issuer shall not provide | 0018| for the issuance of any health insurance coverage in the market | 0019| involved during the five-year period beginning on the date of | 0020| the discontinuation of the last health insurance coverage not | 0021| renewed. | 0022| F. At the time of coverage renewal pursuant to | 0023| Subsection A of this section, a health insurance issuer may | 0024| modify the coverage for a policy form offered to individuals in | 0025| the individual market if the modification is consistent with | - 49 - 0001| law and effective on a uniform basis among all individuals with | 0002| that policy form. | 0003| G. If health insurance coverage is made available | 0004| by a health insurance issuer in the individual market to an | 0005| individual only through one or more associations, a reference | 0006| to an "individual" is deemed to include a reference to that | 0007| association." | 0008| Section 24. A new Section 59A-23E-20 NMSA 1978 is | 0009| enacted to read: | 0010| "59A-23E-20. [NEW MATERIAL] CERTIFICATION OF COVERAGE | 0011| BY ISSUERS IN THE INDIVIDUAL MARKET.--The provisions of Section | 0012| 59A-23E-7 NMSA 1978 apply to health insurance coverage offered | 0013| by a health insurance issuer in the individual market in the | 0014| same manner as it applies to health insurance coverage offered | 0015| by a health insurance issuer in connection with a group health | 0016| plan in the small or large group market." | 0017| Section 25. Section 59A-54-3 NMSA 1978 (being Laws 1987, | 0018| Chapter 154, Section 3, as amended) is amended to read: | 0019| "59A-54-3. DEFINITIONS.--As used in the Comprehensive | 0020| Health Insurance Pool Act: | 0021| A. "board" means the board of directors of the | 0022| pool; | 0023| B. "creditable coverage" means, with respect to an | 0024| individual, coverage of the individual pursuant to: | 0025| (1) a group health plan; | - 50 - 0001| (2) health insurance coverage; | 0002| (3) Part A or Part B of Title 18 of the | 0003| Social Security Act; | 0004| (4) Title 19 of the Social Security Act | 0005| except coverage consisting solely of benefits pursuant to | 0006| Section 1928 of that title; | 0007| (5) 10 USCA Chapter 55; | 0008| (6) a medical care program of the Indian | 0009| health service or of an Indian nation, tribe or pueblo; | 0010| (7) the Comprehensive Health Insurance Pool | 0011| Act; | 0012| (8) a health plan offered pursuant to 5 USCA | 0013| Chapter 89; | 0014| (9) a public health plan as defined in | 0015| federal regulations; or | 0016| (10) a health benefit plan offered pursuant | 0017| to Section 5(e) of the federal Peace Corps Act; | 0018| ~~[B.]~~ C. "health care facility" means any entity | 0019| providing health care services that is licensed by the | 0020| department of health; | 0021| ~~[C.]~~ D. "health care services" means any | 0022| services or products included in the furnishing to any | 0023| individual of medical care or hospitalization, or incidental to | 0024| the furnishing of such care or hospitalization, as well as the | 0025| furnishing to any person of any other services or products for | - 51 - 0001| the purpose of preventing, alleviating, curing or healing human | 0002| illness or injury; | 0003| ~~[D.]~~ E. "health insurance" means any hospital | 0004| and medical expense-incurred policy; nonprofit health care | 0005| service plan contract; health maintenance organization | 0006| subscriber contract; short-term, accident, fixed indemnity, | 0007| specified disease policy or disability income contracts; | 0008| ~~[and]~~ limited benefit insurance; ~~[or]~~ credit insurance; | 0009| or as defined by Section 59A-7-3 NMSA 1978. "Health insurance" | 0010| does not include insurance arising out of the Workers' | 0011| Compensation Act or similar law, automobile medical payment | 0012| insurance or insurance under which benefits are payable with or | 0013| without regard to fault and ~~[which]~~ that is required by law | 0014| to be contained in any liability insurance policy; | 0015| ~~[E.]~~ F. "health maintenance organization" means | 0016| any person who provides, at a minimum, either directly or | 0017| through contractual or other arrangements with others, basic | 0018| health care services to enrollees on a fixed prepayment basis | 0019| and who is responsible for the availability, accessibility and | 0020| quality of the health care services provided or arranged, or as | 0021| defined by Subsection M of Section 59A-46-2 NMSA 1978; | 0022| ~~[F.]~~ G. "health plan" means any arrangement by | 0023| which persons, including dependents or spouses, covered or | 0024| making application to be covered under the pool have access to | 0025| hospital and medical benefits or reimbursement, including group | - 52 - 0001| or individual insurance or subscriber contract; coverage | 0002| through health maintenance organizations, preferred provider | 0003| organizations or other alternate delivery systems; coverage | 0004| under prepayment, group practice or individual practice plans; | 0005| coverage under uninsured arrangements of group or group-type | 0006| contracts, including employer self-insured, cost-plus or other | 0007| benefits methodologies not involving insurance or not subject | 0008| to New Mexico premium taxes; coverage under group-type | 0009| contracts that are not available to the general public and can | 0010| be obtained only because of connection with a particular | 0011| organization or group; and coverage by medicare or other | 0012| governmental benefits. "Health plan" includes coverage through | 0013| health insurance; | 0014| ~~[G.]~~ H. "insured" means an individual resident | 0015| of this state who is eligible to receive benefits from any | 0016| insurer or other health plan; | 0017| ~~[H.]~~ I. "insurer" means an insurance company | 0018| authorized to transact health insurance business in this state, | 0019| a nonprofit health care plan, a health maintenance organization | 0020| and self-insurers not subject to federal preemption. "Insurer" | 0021| does not include an insurance company that is licensed under | 0022| the Prepaid Dental Plan Law or a company that is solely engaged | 0023| in the sale of dental insurance and is licensed not under that | 0024| act, but under another provision of the Insurance Code; | 0025| ~~[I.]~~ J. "medicare" means coverage under | - 53 - 0001| ~~[both]~~ Part A ~~[and]~~ or Part B of Title ~~[XVIII]~~ 18 of | 0002| the Social Security Act, as amended; | 0003| ~~[J.]~~ K. "pool" means the New Mexico | 0004| comprehensive health insurance pool; | 0005| ~~[K. "superintendent" means the superintendent of~~ | 0006| ~~insurance;]~~ and | 0007| L. "therapist" means a licensed physical, | 0008| occupational, speech or respiratory therapist." | 0009| Section 26. Section 59A-54-12 NMSA 1978 (being Laws | 0010| 1987, Chapter 154, Section 12, as amended) is amended to read: | 0011| "59A-54-12. ELIGIBILITY--POLICY PROVISIONS.-- | 0012| A. Except as provided in Subsection B of this | 0013| section, a person is eligible for a pool policy only if on the | 0014| effective date of coverage or renewal of coverage the person is | 0015| a New Mexico resident, and: | 0016| (1) is not eligible as an insured or covered | 0017| dependent for any health plan that provides coverage for | 0018| comprehensive major medical or comprehensive physician and | 0019| hospital services; | 0020| (2) is only eligible for a health plan that | 0021| is offered at a rate higher than that available from the pool; | 0022| (3) has been rejected for coverage for | 0023| comprehensive major medical or comprehensive physician and | 0024| hospital services; | 0025| (4) is only eligible for a health plan with a | - 54 - 0001| rider, waiver or restrictive provision for that particular | 0002| individual based on a specific condition; ~~[or]~~ | 0003| (5) has as of the date the individual seeks | 0004| coverage from the pool an aggregate of eighteen or more months | 0005| of creditable coverage, the most recent of which was under a | 0006| group health plan, governmental plan or church plan as defined | 0007| in Subsections ~~[Q, O]~~ P, N and D, respectively, of Section | 0008| ~~[2 of the Health Insurance Portability Act]~~ 59A-23E-2 NMSA | 0009| 1978, except, for the purposes of aggregating creditable | 0010| coverage, a period of creditable coverage shall not be counted | 0011| with respect to enrollment of an individual for coverage under | 0012| the pool if, after that period and before the enrollment date, | 0013| there was a sixty-three-day or longer period during all of | 0014| which the individual was not covered under any creditable | 0015| coverage; or | 0016| (6) is entitled to continuation coverage | 0017| pursuant to Section 59A-23E-19 NMSA 1978. | 0018| B. A person's eligibility for a policy issued under | 0019| the Health Insurance Alliance Act shall not preclude a person | 0020| from remaining on a pool policy; provided that a self- | 0021| employed person who qualifies for an approved health plan under | 0022| the Health Insurance Alliance Act by using a dependent as the | 0023| second employee may choose a pool policy in lieu of the health | 0024| plan under that act. | 0025| C. Coverage under a pool policy is in excess of and | - 55 - 0001| shall not duplicate coverage under any other form of health | 0002| insurance. | 0003| D. A pool policy shall provide that coverage of a | 0004| dependent unmarried person terminates when the person becomes | 0005| nineteen years of age or, if the person is enrolled full time | 0006| in an accredited educational institution, when he becomes | 0007| twenty-five years of age. The policy shall also provide in | 0008| substance that attainment of the limiting age does not operate | 0009| to terminate coverage when the person is and continues to be: | 0010| (1) incapable of self-sustaining employment | 0011| by reason of developmental disability or physical handicap; and | 0012| (2) primarily dependent for support and | 0013| maintenance upon the person in whose name the contract is | 0014| issued. | 0015| Proof of incapacity and dependency shall be furnished to | 0016| the insurer within one hundred twenty days of attainment of the | 0017| limiting age and subsequently as required by the insurer but | 0018| not more frequently than annually after the two-year period | 0019| following attainment of the limiting age. | 0020| E. A pool policy that provides coverage for a | 0021| family member of the person in whose name the contract is | 0022| issued shall, as to the coverage of the family member or the | 0023| individual in whose name the contract was issued, provide that | 0024| the health insurance benefits applicable for children are | 0025| payable with respect to a newly born child of the family member | - 56 - 0001| or the person in whose name the contract is issued from the | 0002| moment of coverage of injury or illness, including the | 0003| necessary care and treatment of medically diagnosed congenital | 0004| defects and birth abnormalities. If payment of a specific | 0005| premium is required to provide coverage for the child, the | 0006| contract may require that notification of the birth of a child | 0007| and payment of the required premium shall be furnished to the | 0008| carrier within thirty-one days after the date of birth in order | 0009| to have the coverage continued beyond the thirty-one day | 0010| period. | 0011| F. Except for a person eligible as provided in | 0012| ~~[Paragraphs]~~ Paragraph (5) of Subsection A of this section, | 0013| a pool policy may contain provisions under which coverage is | 0014| excluded during a six-month period following the effective date | 0015| of coverage as to a given individual for preexisting | 0016| conditions, as long as either of the following exists: | 0017| (1) the condition has manifested itself | 0018| within a period of six months before the effective date of | 0019| coverage in such a manner as would cause an ordinarily prudent | 0020| person to seek diagnoses or treatment; or | 0021| (2) medical advice or treatment was | 0022| recommended or received within a period of six months before | 0023| the effective date of coverage. | 0024| G. The preexisting condition exclusions described | 0025| in Subsection F of this section shall be waived to the extent | - 57 - 0001| to which similar exclusions have been satisfied under any prior | 0002| health insurance coverage that was involuntarily terminated, if | 0003| the application for pool coverage is made not later than | 0004| thirty-one days following the involuntary termination. In that | 0005| case, coverage in the pool shall be effective from the date on | 0006| which the prior coverage was terminated. This subsection does | 0007| not prohibit preexisting conditions coverage in a pool policy | 0008| that is more favorable to the insured than that specified in | 0009| this subsection. | 0010| H. An individual is not eligible for coverage by | 0011| the pool if: | 0012| (1) he is, at the time of application, | 0013| eligible for medicare or medicaid which would provide coverage | 0014| for amounts in excess of limited policies such as dread | 0015| disease, cancer policies or hospital indemnity policies; | 0016| (2) he has terminated coverage by the pool | 0017| within the past twelve months; | 0018| (3) he is an inmate of a public institution | 0019| or is eligible for public programs for which medical care is | 0020| provided; | 0021| (4) he is eligible for coverage under a group | 0022| health plan; | 0023| (5) he has ~~[other]~~ health insurance | 0024| coverage as defined in Subsection R of Section 59A-23E-2 NMSA | 0025| 1978; | - 58 - 0001| (6) the most recent coverages within the | 0002| coverage period described in Paragraph (5) of Subsection A of | 0003| this section ~~[was]~~ were terminated as a result of | 0004| nonpayment of premium or fraud; or | 0005| (7) he has been offered the option of | 0006| continuation coverage under a federal COBRA continuation | 0007| provision as defined in Subsection F of Section ~~[2 of the~~ | 0008| ~~Health Insurance Portability Act]~~ 59A-23E-2 NMSA 1978 or | 0009| under a similar state program and he has elected the coverage | 0010| and did not exhaust the continuation coverage under the | 0011| provision or program. | 0012| I. Any person whose health insurance coverage from | 0013| a qualified state health policy with similar coverage is | 0014| terminated because of nonresidency in another state may apply | 0015| for coverage under the pool. If the coverage is applied for | 0016| within thirty-one days after that termination and if premiums | 0017| are paid for the entire coverage period, the effective date of | 0018| the coverage shall be the date of termination of the previous | 0019| coverage." | 0020| Section 27. Section 59A-56-3 NMSA 1978 (being Laws 1994, | 0021| Chapter 75, Section 3, as amended) is amended to read: | 0022| "59A-56-3. DEFINITIONS.--As used in the Health Insurance | 0023| Alliance Act: | 0024| A. "alliance" means the New Mexico health insurance | 0025| alliance; | - 59 - 0001| B. "approved health plan" means any arrangement for | 0002| the provisions of health insurance offered through and approved | 0003| by the alliance; | 0004| C. "board" means the board of directors of the | 0005| alliance; | 0006| D. "child" means a dependent unmarried individual | 0007| who is less than nineteen years of age or an unmarried | 0008| individual who is enrolled full time in an accredited | 0009| educational institution until the individual becomes twenty- | 0010| five years of age; | 0011| E. "creditable coverage" means, with respect to an | 0012| individual, coverage of the individual pursuant to: | 0013| (1) a group health plan; | 0014| (2) health insurance coverage; | 0015| (3) Part A or Part B of Title 18 of the | 0016| Social Security Act; | 0017| (4) Title 19 of the Social Security Act | 0018| except coverage consisting solely of benefits pursuant to | 0019| Section 1928 of that title; | 0020| (5) 10 USCA Chapter 55; | 0021| (6) a medical care program of the Indian | 0022| health service or of an Indian nation, tribe or pueblo; | 0023| (7) the Comprehensive Health Insurance Pool | 0024| Act; | 0025| (8) a health plan offered pursuant to 5 USCA | - 60 - 0001| Chapter 89; | 0002| (9) a public health plan as defined in | 0003| federal regulations; or | 0004| (10) a health benefit plan offered pursuant | 0005| to Section 5(e) of the federal Peace Corps Act; | 0006| F. "department" means the department of insurance; | 0007| G. "director" means an individual who serves on the | 0008| board; | 0009| H. "earned premiums" means premiums paid or due | 0010| during a calendar year for coverage under an approved health | 0011| plan less any unearned premiums at the end of that calendar | 0012| year plus any unearned premiums from the end of the immediately | 0013| preceding calendar year; | 0014| I. "eligible expenses" means the allowable charges | 0015| for a health care service covered under an approved health | 0016| plan; | 0017| J. "eligible individual": | 0018| (1) means an individual who: | 0019| (a) ~~[who]~~ as of the date of the | 0020| individual's application for coverage under an approved health | 0021| plan, has an aggregate of eighteen or more months of creditable | 0022| coverage, the most recent of which was under a group health | 0023| plan, governmental plan or church plan as those plans are | 0024| defined in Subsections ~~[Q, O]~~ P, N and D of Section ~~[2 of~~ | 0025| ~~the Health Insurance Portability Act]~~ 59A-23E-2 NMSA 1978, | - 61 - 0001| respectively, or health insurance offered in connection with | 0002| any of those plans, but for the purposes of aggregating | 0003| creditable coverage, a period of creditable coverage shall not | 0004| be counted with respect to enrollment of an individual for | 0005| coverage under an approved health plan if, after that period | 0006| and before the enrollment date, there was a sixty-three-day or | 0007| longer period during all of which the individual was not | 0008| covered under any creditable coverage; or | 0009| (b) is entitled to continuation | 0010| coverage pursuant to Section 59A-56-20 or 59A-23E-19 NMSA | 0011| 1978; and | 0012| (2) does not include an individual who: | 0013| (a) has or is eligible for coverage | 0014| under a group health plan; | 0015| (b) is eligible for coverage under | 0016| medicare or a state plan under Title 19 of the federal Social | 0017| Security Act or any successor program; | 0018| (c) has ~~[other]~~ health insurance | 0019| coverage as defined in Subsection R of Section 59A-23E-2 NMSA | 0020| 1978; | 0021| (d) during the most recent coverage | 0022| within the coverage period described in ~~[Subsection E of~~ | 0023| ~~Section 59A-36-3 NMSA 1978]~~ Subparagraph (a) of Paragraph (1) | 0024| of this subsection was terminated from coverage as a result of | 0025| nonpayment of premium or fraud; or | - 62 - 0001| (e) has been offered the option of | 0002| coverage under a COBRA continuation provision as that term is | 0003| defined in Subsection F of Section ~~[2 of the Health Insurance~~ | 0004| ~~Portability Act]~~ 59A-23E-2 NMSA 1978, or under a similar | 0005| state program, except for continuation coverage under Section | 0006| 59A-56-20 NMSA 1978, and did not exhaust the coverage available | 0007| under the offered program; | 0008| K. "enrollment date" means, with respect to an | 0009| individual covered under a group health plan or health | 0010| insurance coverage, the date of enrollment of the individual in | 0011| the plan or coverage or, if earlier, the first day of the | 0012| waiting period for that enrollment; | 0013| L. "gross earned premiums" means premiums paid or | 0014| due during a calendar year for all health insurance written in | 0015| the state less any unearned premiums at the end of that | 0016| calendar year plus any unearned premiums from the end of the | 0017| immediately preceding calendar year; | 0018| M. "group health plan" means an employee welfare | 0019| benefit plan to the extent the plan provides hospital, surgical | 0020| or medical expenses benefits to employees or their dependents, | 0021| as defined by the terms of the plan, directly through | 0022| insurance, reimbursement or otherwise; | 0023| N. "health care service" means a service or product | 0024| furnished an individual for the purpose of preventing, | 0025| alleviating, curing or healing human illness or injury and | - 63 - 0001| includes services and products incidental to furnishing the | 0002| described services or products; | 0003| O. "health insurance" means "health" insurance as | 0004| defined in Section 59A-7-3 NMSA 1978; any hospital and medical | 0005| expense-incurred policy; nonprofit health care plan service | 0006| contract; health maintenance organization subscriber contract; | 0007| short-term, accident, fixed indemnity, specified disease policy | 0008| or disability income insurance contracts and limited health | 0009| benefit or credit health insurance; coverage for health care | 0010| services under uninsured arrangements of group or group-type | 0011| contracts, including employer self-insured, cost-plus or other | 0012| benefits methodologies not involving insurance or not subject | 0013| to New Mexico premium taxes; coverage for health care services | 0014| under group-type contracts that are not available to the | 0015| general public and can be obtained only because of connection | 0016| with a particular organization or group; coverage by medicare | 0017| or other governmental programs providing health care services; | 0018| but "health insurance" does not include insurance issued | 0019| pursuant to provisions of the Workers' Compensation Act or | 0020| similar law, automobile medical payment insurance or provisions | 0021| by which benefits are payable with or without regard to fault | 0022| ~~[that]~~ and are required by law to be contained in any | 0023| liability insurance policy; | 0024| P. "health maintenance organization" means a health | 0025| maintenance organization as defined by Subsection M of Section | - 64 - 0001| 59A-46-2 NMSA 1978; | 0002| Q. "incurred claims" means claims paid during a | 0003| calendar year plus claims incurred in the calendar year and | 0004| paid prior to April 1 of the succeeding year, less claims | 0005| incurred previous to the current calendar year and paid prior | 0006| to April 1 of the current year; | 0007| R. "insured" means a small employer or its employee | 0008| and an individual covered by an approved health plan, a former | 0009| employee of a small employer who is covered by an approved | 0010| health plan through conversion or an individual covered by an | 0011| approved health plan that allows individual enrollment; | 0012| S. "medicare" means coverage under both Parts A and | 0013| B of Title 18 of the federal Social Security Act; | 0014| T. "member" means a member of the alliance; | 0015| U. "nonprofit health care plan" means a "health | 0016| care plan" as defined in Subsection K of Section 59A-47-3 NMSA | 0017| 1978; | 0018| V. "premiums" means the premiums received for | 0019| coverage under an approved health plan during a calendar year; | 0020| W. "small employer" means a person that is a | 0021| resident of this state, has employees at least fifty percent of | 0022| whom are residents of this state, is actively engaged in | 0023| business and that on at least fifty percent of its working days | 0024| during either of the two preceding calendar years, employed no | 0025| ~~[less]~~ fewer than two and no more than fifty eligible | - 65 - 0001| employees; provided that: | 0002| (1) in determining the number of eligible | 0003| employees, the spouse or dependent of an employee may, at the | 0004| employer's discretion, be counted as a separate employee; | 0005| (2) companies that are affiliated companies | 0006| or that are eligible to file a combined tax return for purposes | 0007| of state income taxation shall be considered one employer; and | 0008| (3) in the case of an employer that was not | 0009| in existence throughout a preceding ~~[calender]~~ calendar | 0010| year, the determination of whether the employer is a small or | 0011| large employer shall be based on the average number of | 0012| employees that it is reasonably expected to employ on working | 0013| days in the current ~~[calender]~~ calendar year; | 0014| X. "superintendent" means the superintendent of | 0015| insurance; | 0016| Y. "total premiums" means the total premiums for | 0017| business written in the state received during a calendar year; | 0018| and | 0019| Z. "unearned premiums" means the portion of a | 0020| premium previously paid for which the coverage period is in the | 0021| future." | 0022| Section 28. Section 59A-56-20 NMSA 1978 (being Laws | 0023| 1994, Chapter 75, Section 20, as amended) is amended to read: | 0024| "59A-56-20. RENEWABILITY.-- | 0025| A. An approved health plan shall contain provisions | - 66 - 0001| under which the member offering the plan is obligated to renew | 0002| the health insurance if premiums are paid until the day the | 0003| plan is replaced by another plan or the small employer | 0004| terminates coverage. ~~[An individual covered by health~~ | 0005| ~~insurance under an approved health plan may retain coverage~~ | 0006| ~~until he becomes eligible for medicare as the primary~~ | 0007| ~~coverage, except that in a family policy coverage under an~~ | 0008| ~~approved health plan shall continue for any person in the~~ | 0009| ~~family who is not eligible for medicare.]~~ | 0010| B. An approved health plan issued to an eligible | 0011| individual shall contain provisions under which the member | 0012| offering the plan is obligated to renew the health insurance | 0013| except for: | 0014| (1) nonpayment of premium; | 0015| (2) fraud; or | 0016| (3) termination of the approved health plan, | 0017| except that the individual has the right to transfer to another | 0018| approved health plan. | 0019| C. If an approved health plan ceases to exist, the | 0020| alliance shall provide an alternate approved health plan. | 0021| D. An approved health plan shall provide covered | 0022| individuals the right to continue health insurance coverage | 0023| through an approved health plan as individual health insurance | 0024| provided by the same member upon the death of the employee or | 0025| upon the divorce, annulment or dissolution of marriage or legal | - 67 - 0001| separation of the spouse from the employee or by termination of | 0002| employment by electing to do so within a period of time | 0003| specified in the health insurance if the employee was covered | 0004| under an approved health plan while employed for at least six | 0005| consecutive months. The individual may be charged an | 0006| additional administrative charge for the individual health | 0007| insurance. | 0008| E. The right to continue health insurance coverage | 0009| provided in this section terminates if the covered individual | 0010| resides outside the United States for more than six consecutive | 0011| months." | 0012| Section 29. EMERGENCY.--It is necessary for the public | 0013| peace, health and safety that this act take effect immediately. |