October 1, 2015, Introduced by Rep. Leonard and referred to the Committee on Insurance.
A bill to amend 1956 PA 218, entitled
"The insurance code of 1956,"
by amending sections 106, 116, 120, 222, 402, 454, 460, 462, 606,
1210, 2003, 2006, 2059, 2212a, 2212b, 2213, 2213a, 2213b, 2214,
2236, 2237, 3400, 3402, 3403, 3404, 3405, 3406a, 3406c, 3406d,
3406e, 3406j, 3406k, 3406l, 3406m, 3406n, 3406o, 3406p, 3406q,
3406r, 3406s, 3407, 3407b, 3408, 3409, 3411, 3412, 3413, 3414,
3416, 3418, 3420, 3422, 3424, 3425, 3426, 3428, 3432, 3438, 3440,
3452, 3472, 3474, 3474a, 3475, 3476, 3501, 3503, 3505, 3507, 3508,
3509, 3511, 3513, 3515, 3517, 3519, 3528, 3533, 3535, 3545, 3547,
3548, 3551, 3553, 3555, 3557, 3559, 3561, 3563, 3569, 3571, 3573,
3701, 3703, 3705, 3711, 3723, 4601, 4701, 6428, 7060, and 7705 (MCL
500.106, 500.116, 500.120, 500.222, 500.402, 500.454, 500.460,
500.462, 500.606, 500.1210, 500.2003, 500.2006, 500.2059,
500.2212a, 500.2212b, 500.2213, 500.2213a, 500.2213b, 500.2214,
500.2236, 500.2237, 500.3400, 500.3402, 500.3403, 500.3404,
500.3405, 500.3406a, 500.3406c, 500.3406d, 500.3406e, 500.3406j,
500.3406k, 500.3406l, 500.3406m, 500.3406n, 500.3406o, 500.3406p,
500.3406q, 500.3406r, 500.3406s, 500.3407, 500.3407b, 500.3408,
500.3409, 500.3411, 500.3412, 500.3413, 500.3414, 500.3416,
500.3418, 500.3420, 500.3422, 500.3424, 500.3425, 500.3426,
500.3428, 500.3432, 500.3438, 500.3440, 500.3452, 500.3472,
500.3474, 500.3474a, 500.3475, 500.3476, 500.3501, 500.3503,
500.3505, 500.3507, 500.3508, 500.3509, 500.3511, 500.3513,
500.3515, 500.3517, 500.3519, 500.3528, 500.3533, 500.3535,
500.3545, 500.3547, 500.3548, 500.3551, 500.3553, 500.3555,
500.3557, 500.3559, 500.3561, 500.3563, 500.3569, 500.3571,
500.3573, 500.3701, 500.3703, 500.3705, 500.3711, 500.3723,
500.4601, 500.4701, 500.6428, 500.7060, and 500.7705), section 116
as added by 1992 PA 182, section 222 as amended by 1994 PA 443,
section 454 as amended by 1987 PA 168, section 1210 as added and
section 2059 as amended by 1986 PA 253, section 2006 as amended by
2004 PA 28, section 2212a as amended by 2001 PA 235, section 2212b
as amended by 2000 PA 486, section 2213 as amended by 2012 PA 445,
section 2213a as amended by 2002 PA 707, sections 2213b, 3426, and
3705 as amended and sections 3428, 3472, and 3474a as added by 2013
PA 5, section 2236 as amended by 2014 PA 140, sections 3405 and
3475 as amended by 2014 PA 263, section 3406a as added by 1982 PA
527, section 3406c as amended by 1994 PA 233, sections 3406d and
3406e as added by 1989 PA 59, section 3406j as added by 1998 PA
136, section 3406k as amended by 2004 PA 7, section 3406l as added
by 2004 PA 171, section 3406m as added by 1998 PA 402, section
3406n as added by 1999 PA 179, section 3406o as added by 1999 PA
177, section 3406p as added by 2000 PA 425, section 3406q as
amended and sections 3701, 3703, 3711, and 3723 as added by 2003 PA
88, section 3406r as added by 2004 PA 375, section 3406s as added
by 2012 PA 100, section 3407b as added by 2000 PA 27, section 3409
as amended by 1990 PA 170, section 3418 as amended by 1984 PA 280,
section 3425 as added by 1980 PA 429, section 3440 as amended by
1987 PA 52, section 3476 as added by 2012 PA 215, sections 3501,
3505, 3507, 3508, 3509, 3511, 3513, 3535, 3545, 3547, 3548, 3551,
3553, 3555, 3557, 3559, 3561, 3563, 3569, and 3573 as added by 2000
PA 252, section 3503 as amended by 2006 PA 366, sections 3515,
3517, 3519, 3533, and 3571 as amended by 2005 PA 306, section 3528
as amended by 2002 PA 621, sections 4601 and 4701 as added by 2008
PA 29, section 7060 as amended by 1999 PA 82, and section 7705 as
amended by 2006 PA 671, and by adding sections 607, 3400a, 3400b,
3401a, 3402a, 3402b, 3402c, 3402d, 3402e, 3402f, 3402g, 3402h,
3477, and 3544; and to repeal acts and parts of acts.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 106. As used in this act:
(a) "Health maintenance organization" means that term as
defined in section 3501.
(b)
"Insurer" as used in this
code means any an individual,
corporation, association, partnership, reciprocal exchange, inter-
insurer,
Lloyds organization, fraternal benefit society, and any or
other legal entity, engaged or attempting to engage in the business
of making insurance or surety contracts. Except as otherwise
provided in section 3503 and unless the context requires otherwise,
insurer includes a health maintenance organization.
Sec. 116. As used in this act:
(a)
"Abuse of discretion" means not in the reasonable exercise
of
discretion.
(a) "Enrollee" means an individual who is entitled to receive
health services under a health insurance contract, unless the
context requires otherwise.
(b) "Hazardous to policyholders, creditors, and the public"
means that an insurer, with respect to the financial condition of
its business, is not safe, reliable, and entitled to public
confidence.
(c) "In the reasonable exercise of discretion" means that an
order, decision, determination, finding, ruling, opinion, action,
or inaction was based upon facts reasonably found to exist and was
not inconsistent with generally acceptable standards and practices
of those knowledgeable in the field in question.
(d) "Insurance policy" or "insurance contract" means a
contract of insurance, indemnity, suretyship, or annuity issued or
proposed or intended for issuance by a person engaged in the
business of insurance. Unless the context requires otherwise,
insurance contract includes a health maintenance contract, as that
term is defined in section 3501.
(e) "Insurance producer" means that term as defined in section
1201.
(f) "Large employer" means an employer that is not a small
employer as defined in section 3701.
(g) "Participating provider" means a provider that, under
contract with an insurer that issues policies of health insurance
or with such an insurer's contractor or subcontractor, has agreed
to provide health care services to covered individuals with an
expectation of receiving payment, other than coinsurance,
copayments, or deductibles, directly or indirectly from the
insurer.
(h) (d)
"Safe, reliable, and entitled
to public confidence"
means that an insurer meets all of the following:
(i) With respect to its financial standards and conduct and
discharge of its obligations to policyholders and creditors, has
complied and continues to comply with the specific requirements of
this act and, if relevant, the insurance codes or acts of its state
of domicile and other states in which it is authorized to conduct
an insurance business.
(ii) Has made and continues to make reasonable financial
provisions and apply sound insurance principles so as to provide
reasonable margins of financial safety with respect to the
insurance and other obligations it has assumed and continues to
assume such that the insurer will be able to discharge those
obligations under any reasonable conditions and contingencies
taking into account without limitation reasonably anticipated
contingencies, including those affecting changes in the projections
of liabilities, fluctuations in value of assets, alterations in
projections as to when obligations may become due, and expected and
unexpected new claims with respect to obligations.
(i) "Service area" means that term as defined in section 3501,
unless the context requires otherwise.
(j) Except as used in chapters 24, 26, 72, 76, and 81,
"subscriber" means an individual who enters into an insurance
contract for health insurance, or on whose behalf an insurance
contract for health insurance is entered into, with an insurer.
Sec.
120. No A person shall not transact an insurance, or
surety, or health maintenance organization business in Michigan,
this
state, or relative to a subject
resident, located , or to
be
performed
in Michigan, this state, without complying with the
applicable
provisions of this code.act.
Sec.
222. (1) The commissioner director,
in person or by any
of his or her authorized deputies or examiners, may examine any or
all
of the books, records, documents, and papers of any an insurer
at any time after its articles of incorporation have been executed
and filed, or after it has been authorized to do business in this
state.
The commissioner director in his or her discretion may
examine
the affairs of any a domestic insurer , and, if he or she
considers
it expedient to do so, to examine the affairs of any a
foreign or alien insurer doing business in this state.
(2)
Instead of an examination under this act of any a foreign
or alien insurer authorized to do business in this state, the
commissioner
director may accept an examination report on the
insurer as prepared by the insurance regulator for the insurer's
state of domicile or port-of-entry state if that state accepts
examination
reports prepared by the commissioner. director. This
subsection applies only as follows:
(a)
Until this state becomes accredited by the national
association
of insurance commissioners' National
Association of
Insurance Commissioners' financial regulation standards and
accreditation program.
(b)
If this state loses accreditation by the national
association
of insurance commissioners' National
Association of
Insurance Commissioners' financial regulation standards and
accreditation program.
(3)
Instead of an examination under this act of any a foreign
or alien insurer authorized to do business in this state, the
commissioner
director may accept an examination report on the
insurer as prepared by the insurance regulator for the insurer's
state of domicile or port-of-entry state if that state accepts
examination
reports prepared by the commissioner director and if
the insurance regulatory agency of the state of domicile or port-
of-entry
state was accredited by the national association of
insurance
commissioners' National
Association of Insurance
Commissioners' financial regulation standards and accreditation
program at the time of the examination or if the examination is
performed under the supervision of an accredited insurance
regulatory agency or with the participation of 1 or more examiners
who are employed by an accredited insurance regulatory agency and
who, after a review of the examination work papers and report,
state under oath that the examination was prepared in a manner
consistent with the standards and procedures required by their
accredited regulatory agency. This subsection only applies during
the
time this state is accredited by the national association of
insurance
commissioners' National
Association of Insurance
Commissioners' financial regulation standards and accreditation
program.
(4)
The commissioner director,
in person or by any of his or
her authorized deputies or examiners, shall once every 5 years
examine the books, records, documents, and papers of each
authorized
insurer. The commissioner director
may examine an
insurer
more frequently and upon on
its request shall examine a
domestic insurer that has not been examined for the 3 years
immediately
preceding the request. This section
does not authorize
the examination of books, records, documents, or papers if those
items involve matters that are a subject of a currently pending
administrative or judicial proceeding against the insurer from whom
the
information is sought, unless the commissioner director or
judge specifically finds on the record of the proceeding that the
examination is reasonably necessary to protect the interests of
policyholders, creditors, or the public or to make a determination
of whether an insurer is safe, reliable, and entitled to public
confidence.
(5) The business affairs, assets, and contingent liabilities
of
insurers shall be are subject to examination by the commissioner
director
at any time. The commissioner director may
supervise and
make the same examination of the business and affairs of every
foreign or alien insurer doing business in this state as of
domestic insurers doing the same kind of business and of its
assets,
books, accounts, and general condition. Every A foreign
or
alien
insurer and its the agents and officers of the insurer are
subject
to the same obligations, and are subject to the same
examinations,
and, in case of default therein, to if the insurer,
agent, or officer defaults in an obligation, the same penalties and
liabilities
as that a domestic insurers insurer doing
the same kind
of
business , or any of and the agents or and officers
thereof, of
the
insurer are or may be liable subject to
under the laws of this
state
or the regulations of the insurance bureau of the department
of
commerce. rules promulgated
by the director. The commissioner
director may, whenever he or she considers it expedient to do so,
either
in person or by a proper person appointed by him or her,
repair
go to the general office or other offices of the
foreign or
alien
insurer, wherever the same may be, located, and make an
investigation
and examination of its the
insurer's affairs and
condition.
(6)
Upon On an examination under this section, the
commissioner,
director, his or her deputy, or any examiner
authorized by him or her may examine in person, by writing, and, if
appropriate, under oath the officers or agents of the insurer or
all persons considered to have material information regarding the
insurer's
property, assets, business, or affairs. The commissioner
director may compel the attendance and testimony of witnesses and
the production of any books, accounts, papers, records, documents,
and files relating to the insurer's business or affairs, and may
sign subpoenas, administer oaths and affirmations, examine
witnesses, and receive evidence for this purpose. The insurer and
its officers and agents shall produce its books and records and all
papers in its or their possession relating to its business or
affairs, and any other person may be required to produce any books,
records, or papers considered relevant to the examination for the
inspection
of the commissioner, director,
or his or her deputy or
examiners, whenever required. The insurer's officers or agents
shall
facilitate the examination and aid in making the same
examination so far as it is in their power to do so. If the
commissioner's
director's order or subpoena is not followed, the
commissioner
director may request the Ingham county County circuit
court to issue an order requiring compliance with the
commissioner's
order or subpoena.
(7)
Not later than 60 days following completion of the after
completing an examination under this section, the deputy or
examiners shall make a full and true report, and furnish the
insurer a copy of the examination report, that shall comprise only
facts appearing on the insurer's books, records, or documents or
ascertained from examination of its officers or agents or other
persons concerning its affairs and the conclusions and
recommendations as may be reasonably warranted from the facts
disclosed.
An On request by an insurer examined under this section,
upon
its request, the director shall be granted grant the insurer a
hearing
before the commissioner director
or his or her designee
before
the report is filed. Upon On
request of the insurer, the
director
shall close the hearing shall be
closed to the public. A
hearing under this subsection is not subject to the administrative
procedures
act of 1969, Act No. 306 of the Public Acts of 1969,
being
sections 24.201 to 24.328 of the Michigan Compiled Laws. 1969
PA
306, MCL 24.201 to 24.328. Each
examination report shall must
be
withheld from public inspection until the report is final and filed
with
the commissioner. director.
In addition, the commissioner
director may withhold any examination report or any analysis of an
insurer's
financial condition from public inspection for such any
time
as that he or she may consider considers proper. In any event,
the department shall withhold from public inspection all
information
and testimony furnished to the insurance bureau
department
and the insurance bureau's department's work papers,
correspondence, memoranda, reports, records, and other written or
oral information related to an examination report or an
investigation
shall be withheld from public inspection, shall be
and
these items are confidential, shall are not
be subject to
subpoena,
and shall must not be divulged to any person, except as
provided in this section. If assurances are provided that the
information
will be kept confidential, the commissioner director
may disclose confidential work papers, correspondence, memoranda,
reports, records, or other information as follows:
(a) To the governor or the attorney general.
(b) To any relevant regulatory agency or authority, including
regulatory
agencies or authorities of other states, or the federal
government, or other countries.
(c)
In connection with an enforcement action brought pursuant
to
under this or another applicable act.
(d) To law enforcement officials.
(e)
To persons authorized by the Ingham county County circuit
court to receive the information.
(f)
To persons entitled to receive such the information in
order to discharge duties specifically provided for in this act.
(8) The confidentiality requirements of subsection (7) do not
apply in any proceeding or action brought against or by the insurer
under this act or any other applicable act of this state, any other
state, or the United States.
(9) Notwithstanding the other provisions of this section, the
commissioner
director is not required to finalize and file an
examination report for an insurer for a year in which an
examination report was not finalized and filed, if the insurer is
currently undergoing an examination subsequent to the year for
which
an examination report was not finalized and filed. Nothing
contained
in this This section shall be construed to does not limit
the
commissioner's director's authority to terminate or suspend any
examination
in order to pursue other legal or regulatory action
pursuant
to under the insurance laws of this state. Findings of
fact
and conclusions made pursuant to in connection with any
examination
shall be under this section
are prima facie evidence in
any legal or regulatory action.
(10) The examination of an alien insurer is limited to its
United States business, except as otherwise required by the
commissioner.director.
Sec.
402. No A person shall not act as an insurer and no
an
insurer
shall not issue any a policy or otherwise
transact
insurance in this state except as authorized by a subsisting
certificate
of authority granted to it by the commissioner pursuant
to
director under this code.act.
Sec. 454. (1) Except as otherwise provided in this section,
the
department shall not authorize an
insurer shall not be
authorized
to do business in this state if its
name is the same as
or
closely resembles the name of any other another insurer
organized under or authorized to do business under the laws of this
state.
However, the department may
authorize an insurer may be
authorized
to do business in this state by
adding if it adds to its
corporate name a word, abbreviation, or other distinctive and
distinguishing element.
(2) The department shall issue a certificate of authority
issued
to the an insurer
shall be issued in the name applied for,
and the insurer shall use that name in all its dealings with the
commissioner
department and in the conduct of its affairs in this
state.
Any document used or advertising offered in this state An
insurer shall identify the incorporated name of the insurer in any
document used or advertising offered in this state.
(3)
The commissioner director may
disapprove the use of any a
name of an insurer or health maintenance organization if the
commissioner
director determines that the name is deceptive or
misleading.
Sec.
460. An Except as
otherwise provided in section 1202, an
insurer authorized to transact business in this state shall not
write,
place, or cause to be written or placed ,
any an insurance
policy
or insurance contract of insurance in this state, except
through
an agent duly licensed by the commissioner.insurance
producer.
Sec.
462. An Except as
otherwise provided in this section, an
application
for life or disability insurance shall must bear the
signature
of a licensed agent.an
insurance producer. This section
does not apply to an application for insurance through the
insurer's Internet website if the website contains a statement that
the applicant may use an insurance producer to assist with the
application at no cost to the applicant.
Sec.
606. (1) "Disability" insurance is insurance of
any
person
against bodily injury or death by
accident, or against
disability
on account of sickness or accident. including also the
granting
of specific hospital benefits and medical, surgical and
sick-care
benefits Unless specifically
excluded in chapter 34,
disability
insurance includes health insurance issued to any
person,
an individual, family, or group, subject to such
limitations
as may be that are prescribed with respect thereto:
Provided,
The to the insurance.
(2) An insured under a disability insurance policy as
described
in this section may be an employee of any
a person that
is
not subject to the provisions of the
workmen's worker's
disability
compensation law and in such case act of 1969, 1969 PA
317, MCL 418.101 to 418.941. If the person is subject to the
worker's disability compensation act of 1969, 1969 PA 317, MCL
418.101
to 418.941, the liability may be
limited to such as may
arise
liability arising out of and in the course of the employee's
employment and the premium may be paid by the employer under an
agreement with the employee.
Sec. 607. "Health" insurance is an expense-incurred hospital,
medical, or surgical policy, certificate, or contract.
Sec.
1210. (1) An accident and health insurance agent producer
who
is a health benefit agent pursuant to under the health benefit
agent
act, shall be 1986 PA 252, MCL 550.1001 to 550.1020, is
subject to the health benefit agent act, 1986 PA 252, MCL 550.1001
to
550.1020, when selling a health
benefits. benefit. As used in
this
section, "health benefits" benefit" and
"health benefit agent"
means
mean those terms as defined in section 2 of the health
benefit agent act, 1986 PA 252, MCL 550.1002.
(2) An accident and health insurance producer may arrange for
excess loss insurance in conjunction with the sale of
administrative services benefits.
(3) An accident and health insurance producer may arrange with
an insurer for the insurer to sell a policy to supplement the
health benefits of a health maintenance organization.
Sec. 2003. (1) A person shall not engage in a trade practice
which
that is defined or
described in this uniform trade
practices
act
chapter or is determined pursuant to under this
act chapter to
be , an unfair method of competition or an unfair or
deceptive act
or practice in the business of insurance.
(2)
"Person" Except
as otherwise provided in this subsection,
"person"
means a person that term as defined in section 114 and
includes
an agent, insurance
producer, solicitor, counselor, or
adjuster. ,
but excludes Person does not
include the property and
casualty guaranty association.
(3)
"Insurance policy" or "insurance contract" means a
contract
of insurance, indemnity, suretyship, or annuity issued or
proposed
or intended for issuance by a person engaged in the
business
of insurance.
Sec. 2006. (1) A person must pay on a timely basis to its
insured,
an individual or entity a
person directly entitled to
benefits
under its insured's insurance contract, of insurance, or a
third party tort claimant the benefits provided under the terms of
its policy, or, in the alternative, the person must pay to its
insured,
an individual or entity a
person directly entitled to
benefits
under its insured's insurance contract, of insurance, or a
third party tort claimant 12% interest, as provided in subsection
(4), on claims not paid on a timely basis. Failure to pay claims on
a timely basis or to pay interest on claims as provided in
subsection (4) is an unfair trade practice unless the claim is
reasonably in dispute.
(2) A person shall not be found to have committed an unfair
trade practice under this section if the person is found liable for
a claim pursuant to a judgment rendered by a court of law, and the
person
pays to its insured, individual or entity the person
directly entitled to benefits under its insured's insurance
contract, of
insurance, or the third party tort claimant interest
as provided in subsection (4).
(3) An insurer shall specify in writing the materials that
constitute a satisfactory proof of loss not later than 30 days
after receipt of a claim unless the claim is settled within the 30
days. If proof of loss is not supplied as to the entire claim, the
amount
supported by proof of loss shall be is considered paid on a
timely basis if paid within 60 days after receipt of proof of loss
by the insurer. Any part of the remainder of the claim that is
later
supported by proof of loss shall be is considered paid on a
timely basis if paid within 60 days after receipt of the proof of
loss by the insurer. If the proof of loss provided by the claimant
contains facts that clearly indicate the need for additional
medical information by the insurer in order to determine its
liability
under a policy of life insurance, the claim shall be is
considered paid on a timely basis if paid within 60 days after
receipt of necessary medical information by the insurer. Payment of
a
claim shall is not be untimely during any period in which
the
insurer
is unable to pay the claim when if
there is no recipient
who is legally able to give a valid release for the payment, or
where
if the insurer is unable to determine who is entitled
to
receive the payment, if the insurer has promptly notified the
claimant of that inability and has offered in good faith to
promptly pay the claim upon determination of who is entitled to
receive the payment.
(4) If benefits are not paid on a timely basis, the benefits
paid
shall bear simple interest from a date 60 days after
satisfactory proof of loss was received by the insurer at the rate
of
12% per annum, if the claimant is the insured or an individual
or
entity a person directly entitled to benefits under the
insured's
insurance contract. of insurance. If the claimant is a
third
party tort claimant, then the benefits paid shall bear
interest from a date 60 days after satisfactory proof of loss was
received by the insurer at the rate of 12% per annum if the
liability of the insurer for the claim is not reasonably in
dispute, the insurer has refused payment in bad faith, and the bad
faith
was determined by a court of law. The interest shall must be
paid in addition to and at the time of payment of the loss. If the
loss exceeds the limits of insurance coverage available, interest
shall
be is payable based upon on the
limits of insurance coverage
rather than the amount of the loss. If payment is offered by the
insurer but is rejected by the claimant, and the claimant does not
subsequently recover an amount in excess of the amount offered,
interest
is not due. Interest paid pursuant to as provided in this
section
shall must be offset by any award of interest that is
payable
by the insurer pursuant to as
provided in the award.
(5) If a person contracts to provide benefits and reinsures
all or a portion of the risk, the person contracting to provide
benefits
is liable for interest due to an insured, an individual or
entity
a person directly entitled to benefits under its insured's
insurance
contract, of insurance, or a
third party tort claimant
under
this section where if a reinsurer fails to pay benefits on a
timely basis.
(6) If there is any specific inconsistency between this
section
and sections 3101 to 3177 chapter
31 or the worker's
disability compensation act of 1969, 1969 PA 317, MCL 418.101 to
418.941, the provisions of this section do not apply. Subsections
(7)
to (14) do not apply to an entity a person regulated under the
worker's disability compensation act of 1969, 1969 PA 317, MCL
418.101 to 418.941. Subsections (7) to (14) do not apply to the
processing
and paying of medicaid Medicaid
claims that are covered
under section 111i of the social welfare act, 1939 PA 280, MCL
400.111i.
(7) Subsections (1) to (6) do not apply and subsections (8) to
(14) do apply to health plans when paying claims to health
professionals, health facilities, home health care providers, and
durable medical equipment providers, that are not pharmacies and
that
do not involve claims arising out of sections 3101 to 3177
chapter 31 or the worker's disability compensation act of 1969,
1969 PA 317, MCL 418.101 to 418.941. This section does not affect a
health plan's ability to prescribe the terms and conditions of its
contracts, other than as provided in this section for timely
payment.
(8) Each health professional, health facility, home health
care provider, and durable medical equipment provider in billing
for services rendered and each health plan in processing and paying
claims for services rendered shall use the following timely
processing and payment procedures:
(a)
A clean claim shall must be paid within 45 days after
receipt of the claim by the health plan. A clean claim that is not
paid
within 45 days shall bear bears
simple interest at a rate of
12% per annum.
(b) A health plan shall notify the health professional, health
facility, home health care provider, or durable medical equipment
provider within 30 days after receipt of the claim by the health
plan of all known reasons that prevent the claim from being a clean
claim.
(c) A health professional, health facility, home health care
provider,
and or durable medical equipment provider have has 45
days, and any additional time the health plan permits, after
receipt of a notice under subdivision (b) to correct all known
defects. The 45-day time period in subdivision (a) is tolled from
the date of receipt of a notice to a health professional, health
facility, home health care provider, or durable medical equipment
provider under subdivision (b) to the date of the health plan's
receipt of a response from the health professional, health
facility, home health care provider, or durable medical equipment
provider.
(d) If a health professional's, health facility's, home health
care provider's, or durable medical equipment provider's response
under subdivision (c) makes the claim a clean claim, the health
plan shall pay the health professional, health facility, home
health care provider, or durable medical equipment provider within
the 45-day time period under subdivision (a), excluding any time
period tolled under subdivision (c).
(e) If a health professional's, health facility's, home health
care provider's, or durable medical equipment provider's response
under subdivision (c) does not make the claim a clean claim, the
health plan shall notify the health professional, health facility,
home health care provider, or durable medical equipment provider of
an adverse claim determination and of the reasons for the adverse
claim determination within the 45-day time period under subdivision
(a), excluding any time period tolled under subdivision (c).
(f) A health professional, health facility, home health care
provider,
or durable medical equipment provider shall must bill
a
health plan within 1 year after the date of service or the date of
discharge from the health facility in order for a claim to be a
clean claim.
(g) A health professional, health facility, home health care
provider, or durable medical equipment provider shall not resubmit
the
same claim to the health plan unless the time frame in period
under subdivision (a) has passed or as provided in subdivision (c).
(h) A health plan that is a qualified health plan for the
purposes of 45 CFR 156.270 and that, as required in 45 CFR
156.270(d), provides a 3-month grace period to an enrollee who is
receiving advance payments of the premium tax credit and who has
paid 1 full month's premium may pend claims for services rendered
to the enrollee in the second and third months of the grace period.
A claim during the second and third months of the grace period is
not a clean claim under this section, and interest is not payable
under subdivision (a) on that claim if the health plan has complied
with the notice requirements of 45 CFR 155.430 and 45 CFR 156.270.
(9)
Notices required under subsection (8) shall must be
made
in writing or electronically.
(10) If a health plan determines that 1 or more services
listed on a claim are payable, the health plan shall pay for those
services and shall not deny the entire claim because 1 or more
other services listed on the claim are defective. This subsection
does not apply if a health plan and health professional, health
facility, home health care provider, or durable medical equipment
provider have an overriding contractual reimbursement arrangement.
(11) A health plan shall not terminate the affiliation status
or the participation of a health professional, health facility,
home health care provider, or durable medical equipment provider
with a health maintenance organization provider panel or otherwise
discriminate against a health professional, health facility, home
health care provider, or durable medical equipment provider because
the health professional, health facility, home health care
provider, or durable medical equipment provider claims that a
health plan has violated subsections (7) to (10).
(12) A health professional, health facility, home health care
provider, durable medical equipment provider, or health plan
alleging that a timely processing or payment procedure under
subsections (7) to (11) has been violated may file a complaint with
the
commissioner director on a form approved by the commissioner
director and has a right to a determination of the matter by the
commissioner
director or his or her designee. This subsection does
not prohibit a health professional, health facility, home health
care provider, durable medical equipment provider, or health plan
from
seeking court action. A health plan described in subsection
(14)(c)(iv) is subject only to the procedures and penalties
provided
for in subsection (13) and section 402 of the nonprofit
health
care corporation reform act, 1980 PA 350, MCL 550.1402, for
a
violation of a timely processing or payment procedure under
subsections
(7) to (11).
(13) In addition to any other penalty provided for by law, the
commissioner
director may impose a civil fine of not more than
$1,000.00 for each violation of subsections (7) to (11) not to
exceed $10,000.00 in the aggregate for multiple violations.
(14) As used in subsections (7) to (13):
(a) "Clean claim" means a claim that does all of the
following:
(i) Identifies the health professional, health facility, home
health care provider, or durable medical equipment provider that
provided service sufficiently to verify, if necessary, affiliation
status and includes any identifying numbers.
(ii) Sufficiently identifies the patient and health plan
subscriber.
(iii) Lists the date and place of service.
(iv) Is a claim for covered services for an eligible
individual.
(v) If necessary, substantiates the medical necessity and
appropriateness of the service provided.
(vi) If prior authorization is required for certain patient
services, contains information sufficient to establish that prior
authorization was obtained.
(vii) Identifies the service rendered using a generally
accepted system of procedure or service coding.
(viii) Includes additional documentation based upon on
services rendered as reasonably required by the health plan.
(b) "Health facility" means a health facility or agency
licensed under article 17 of the public health code, 1978 PA 368,
MCL 333.20101 to 333.22260.
(c) "Health plan" means all of the following:
(i) An insurer providing benefits under an expense-incurred
hospital,
medical, surgical, vision, or dental a health insurance
policy, or
certificate, including any a
policy, or certificate, or
contract that provides coverage for specific diseases or accidents
only,
an expense-incurred vision or
dental policy, or any a
hospital
indemnity, medicare Medicare
supplement, long-term care,
or 1-time limited duration policy or certificate, but not to
payments made to an administrative services only or cost-plus
arrangement.
(ii) A MEWA regulated under chapter 70 that provides hospital,
medical, surgical, vision, dental, and sick care benefits.
(iii) A health maintenance organization licensed or
issued a
certificate
of authority in this state.
(iv) A health care corporation for benefits provided
under a
certificate
issued under the nonprofit health care corporation
reform
act, 1980 PA 350, MCL 550.1101 to 550.1704, but not to
payments
made pursuant to an administrative services only or cost-
plus
arrangement.
(d)
"Health professional" means a health professional an
individual
licensed, or registered, or otherwise authorized to
engage in a health profession under article 15 of the public health
code, 1978 PA 368, MCL 333.16101 to 333.18838.
Sec.
2059. (1) No Except as
otherwise provided in this act, a
person
shall not maintain or operate any an office
in this state
for
the transaction of the business of insurance , except as
provided
for in this code, or use the name
of any an insurer,
fictitious
or otherwise, in conducting or advertising any a
business that is not related or connected with the business of
insurance
as governed by the provisions of regulated in this code
except
as otherwise provided in subsection (2).act.
(2)
Subsection (1) shall does not be construed to prohibit an
agent
licensed under chapter 12 insurance
producer from marketing
or transacting any of the following:
(a)
Subject to the health benefit agent act, health care
coverage
provided by a health care corporation regulated pursuant
to
the nonprofit health care corporation reform act, Act No. 350 of
the
Public Acts of 1980, being sections 550.1101 to 550.1704 of the
Michigan
Compiled Laws.
(a) (b)
Subject to the health benefit agent
act, 1986 PA 252,
MCL 550.1001 to 550.1020, health care coverage provided by a health
maintenance
organization. regulated pursuant to part 210 of the
public
health code, Act No. 368 of the Public Acts of 1978, being
sections
333.21001 to 333.21098 of the Michigan Compiled Laws.
(b) (c)
Subject to the health benefit agent
act, 1986 PA 252,
MCL 550.1001 to 550.1020, dental care coverage provided by a dental
care
corporation regulated pursuant to Act No. under 1963 PA 125,
of
the Public Acts of 1963, being sections MCL 550.351 to 550.373.
of
the Michigan Compiled Laws.
(c) (d)
Administrative services of a third
party administrator
regulated
pursuant to under the third party administrator act, Act
No.
1984 PA 218, of the Public Acts of 1984, being sections MCL
550.901
to 550.962 of the Michigan Compiled Laws.550.960.
Sec. 2212a. (1) An insurer that delivers, issues for delivery,
or
renews in this state an expense-incurred hospital, medical, or
surgical
a policy or certificate issued under chapter 34 or
36 of
health insurance shall provide a written form in plain English to
insureds upon enrollment that describes the terms and conditions of
the
insurer's policies. and certificates. The form shall must
provide a clear, complete, and accurate description of all of the
following, as applicable:
(a) The service area.
(b) Covered benefits, including prescription drug coverage,
with specifications regarding requirements for the use of generic
drugs.
(c) Emergency health coverages and benefits.
(d) Out-of-area coverages and benefits.
(e) An explanation of the insured's financial responsibility
for copayments, deductibles, and any other out-of-pocket expenses.
(f) Provision for continuity of treatment if a provider's
participation terminates during the course of an insured person's
treatment
by that the provider.
(g) The telephone number to call to receive information
concerning grievance procedures.
(h) How the covered benefits apply in the evaluation and
treatment of pain.
(i)
A summary listing of the information available pursuant to
under subsection (2).
(2) An insurer shall provide upon request to insureds covered
under
a policy or certificate issued under section 3405 or 3631 a
clear, complete, and accurate description of any of the following
information that has been requested:
(a)
The current provider network in the policy or
certificate's
service area, including names and
locations of
affiliated or participating providers by specialty or type of
practice, a statement of limitations of accessibility and referrals
to specialists, and a disclosure of which providers will not accept
new subscribers.
(b) The professional credentials of affiliated or
participating
health professionals, providers,
including, but not
limited
to, affiliated or participating health professionals
providers who are board certified in the specialty of pain medicine
and the evaluation and treatment of pain and have reported that
certification to the insurer, including all of the following:
(i) Relevant professional degrees.
(ii) Date of certification by the applicable nationally
recognized boards and other professional bodies.
(iii) The names of licensed facilities on the provider panel
where
the health professional presently provider currently has
privileges for the treatment, illness, or procedure that is the
subject of the request.
(c) The licensing verification telephone number for the
Michigan
department of consumer licensing and industry services
regulatory affairs that can be accessed for information as to
whether any disciplinary actions or open formal complaints have
been taken or filed against a health care provider in the
immediately preceding 3 years.
(d) Any prior authorization requirements and any limitations,
restrictions, or exclusions, including, but not limited to, drug
formulary limitations and restrictions by category of service,
benefit, and provider, and, if applicable, by specific service,
benefit, or type of drug.
(e)
Indication of the The financial relationships between the
insurer and any closed provider panel, including all of the
following as applicable:
(i) Whether a fee-for-service arrangement exists, under which
the provider is paid a specified amount for each covered service
rendered to the participant.
(ii) Whether a capitation arrangement exists, under which a
fixed amount is paid to the provider for all covered services that
are or may be rendered to each covered individual or family.
(iii) Whether payments to providers are made based on
standards relating to cost, quality, or patient satisfaction.
(f) A telephone number and address to obtain from the insurer
additional information concerning the items described in
subdivisions (a) to (e).
(3) Upon request, any of the information provided under
subsection
(2) shall must be provided in writing. An insurer may
require that a request under subsection (2) be submitted in
writing.
(4) A health insurer shall not deliver or issue for delivery a
policy of insurance to any person in this state unless all of the
following requirements are met:
(a) The style, arrangement, and overall appearance of the
policy do not give undue prominence to any portion of the text.
Every printed portion of the text of the policy and of any
endorsements or attached papers must be plainly printed in light-
faced type of a style in general use, the size of which must be
uniform and not less than 10-point with a lowercase unspaced
alphabet length, not less than 120-point in length of line. As used
in this subdivision, "text" includes all printed matter except the
name and address of the insurer, name or title of the policy, the
brief description, if any, and captions and subcaptions.
(b) Except as otherwise provided in this subdivision or except
as provided in sections 3406 to 3452, exceptions and reductions of
indemnity are set forth in the policy and are printed, at the
insurer's option, with the benefit provision to which they apply or
under an appropriate caption such as "EXCEPTIONS" or "EXCEPTIONS
AND REDUCTIONS". If an exception or reduction of indemnity
specifically applies only to a particular benefit of the policy, a
statement of the exception or reduction must be included with the
benefit provision to which it applies.
(c) Each form, including riders and endorsements, are
identified by a form number in the lower left-hand corner of the
first page of the form.
(d) The policy contains no provision that purports to make any
portion of the charter, rules, constitution, or bylaws of the
insurer a part of the policy unless the portion is set forth in
full in the policy. This subdivision does not apply to the
incorporation of or reference to a statement of rates,
classification of risks, or short-rate table filed with the
director.
(5) (4)
As used in this section,
"board certified" means
certified to practice in a particular medical or other health
professional
specialty by the American board of medical specialties
Board of Medical Specialties or another appropriate national health
professional organization.
Sec.
2212b. (1) This section applies to a policy or
certificate
issued under section 3405 or
3631 and to a health
maintenance organization contract.
(2) If affiliation or participation between a primary care
physician and an insurer terminates, the physician may provide
written notice of this termination within 15 days after the
physician becomes aware of the termination to each insured who has
chosen the physician as his or her primary care physician. If an
insured is in an ongoing course of treatment with any other
physician that is affiliated or participating with the insurer and
the affiliation or participation between the physician and the
insurer terminates, the physician may provide written notice of
this termination to the insured within 15 days after the physician
becomes aware of the termination. The notices under this subsection
may also describe the procedure for continuing care under
subsections (3) and (4).
(3) If affiliation or participation between an insured's
current physician and an insurer terminates, the insurer shall
permit the insured to continue an ongoing course of treatment with
that physician as follows:
(a)
For 90 days from after the date of notice to the insured
by the physician of the physician's termination with the insurer.
(b) If the insured is in her second or third trimester of
pregnancy at the time of the physician's termination, through
postpartum care directly related to the pregnancy.
(c)
If the insured is determined to be terminally ill prior to
have an advanced illness before a physician's termination or
knowledge of the termination and the physician was treating the
terminal
advanced illness before the date of termination or
knowledge of the termination, for the remainder of the insured's
life
for care directly related to the treatment of the terminal
advanced illness.
(4) Subsection (3) applies only if the physician agrees to all
of the following:
(a) To continue to accept as payment in full reimbursement
from
the insurer at the rates applicable prior to before the
termination.
(b) To adhere to the insurer's standards for maintaining
quality health care and to provide to the insurer necessary medical
information related to the care.
(c) To otherwise adhere to the insurer's policies and
procedures, including, but not limited to, those concerning
utilization review, referrals, preauthorizations, and treatment
plans.
(5) An insurer shall provide written notice to each affiliated
or participating physician that if affiliation or participation
between the physician and the insurer terminates, the physician may
do both of the following:
(a) Notify the insurer's insureds under the care of the
physician of the termination if the physician does so within 15
days after the physician becomes aware of the termination.
(b) Include in the notice under subdivision (a) a description
of the procedures for continuing care under subsections (3) and
(4).
(6) This section does not create an obligation for an insurer
to provide to an insured coverage beyond the maximum coverage
limits permitted by the insurer's policy or certificate with the
insured. This section does not create an obligation for an insurer
to expand who may be a primary care physician under a policy or
certificate.
(7) As used in this section:
(a) "Advanced illness" means that term as defined in section
5653 of the public health code, 1978 PA 368, MCL 333.5653.
(b) (a)
"Physician" means an
allopathic physician, osteopathic
physician, or podiatric physician.
(b)
"Terminal illness" means that term as defined in section
5653
of the public health code, 1978 PA 368, MCL 333.5653.
(c) "Terminates" or "termination" includes the nonrenewal,
expiration, or ending for any reason of a participation agreement
or affiliated provider contract between a physician and an insurer,
but does not include a termination by the insurer for failure to
meet applicable quality standards or for fraud.
Sec. 2213. (1) Except as otherwise provided in subsection (4),
each
an insurer and health maintenance organization that delivers,
issues for delivery, or renews in this state a policy of health
insurance shall establish an internal formal grievance procedure
for
approval by the commissioner director
for persons covered under
a
the policy
, certificate, or contract issued
under chapter 34,
35,
or 36 that provides for all of the
following:
(a) A designated person responsible for administering the
grievance system.
(b) A designated person or telephone number for receiving
grievances.
(c) A method that ensures full investigation of a grievance.
(d) Timely notification in plain English to the insured or
enrollee as to the progress of an investigation of a grievance.
(e) The right of an insured or enrollee to appear before a
designated person or committee to present a grievance.
(f) Notification in plain English to the insured or enrollee
of
the results of the insurer's or health maintenance
organization's
investigation of the a grievance
and of the right to
have
the grievance reviewed by the commissioner director or
by an
independent review organization under the patient's right to
independent review act, 2000 PA 251, MCL 550.1901 to 550.1929.
(g) A method for providing summary data on the number and
types
of complaints and grievances filed under this section. The
insurer or health maintenance organization shall annually file the
summary
data for the prior calendar year with the commissioner
director
on forms provided by the commissioner.director.
(h) Periodic management and governing body review of the data
to
assure ensure that appropriate actions have been taken.
(i)
That copies of all complaints grievances
and responses are
available
at the principal office of the insurer or health
maintenance
organization for inspection by the commissioner
director for 2 years following the year the grievance was filed.
(j) That when an adverse determination is made, a written
statement in plain English containing the reasons for the adverse
determination is provided to the insured or enrollee along with
written notifications as required under the patient's right to
independent review act, 2000 PA 251, MCL 550.1901 to 550.1929.
(k) That a final determination will be made in writing by the
insurer
or health maintenance organization not later than 35 30
calendar days after a formal preservice grievance is submitted or
60 calendar days after a formal postservice grievance is submitted
in
writing by the insured or enrollee. The timing for the 35-
calendar-day
period 30-calendar-day period
or 60-calendar-day
period, as applicable, may be tolled, however, for any period of
time the insured or enrollee is permitted to take under the
grievance
procedure and for a period of time that shall must not
exceed
10 business days if the insurer or health maintenance
organization
has not received requested
information from a health
care facility or health professional. If the insurer's procedure
for insureds or enrollees covered under a group policy or plan
includes 2 steps to resolve the grievance, the time for the first
step must be no longer than 15 calendar days for a preservice
grievance or 30 calendar days for a postservice grievance.
(l) That a determination will be made by the insurer or
health
maintenance
organization not later than 72
hours after receipt of
an expedited grievance. Within 10 days after receipt of a
determination, the insured or enrollee may request a determination
of
the matter by the commissioner director
or his or her designee
or by an independent review organization under the patient's right
to independent review act, 2000 PA 251, MCL 550.1901 to 550.1929.
If
the determination by the insurer or health maintenance
organization
is made orally, the insurer or
health maintenance
organization
shall provide a written
confirmation of the
determination to the insured or enrollee not later than 2 business
days after the oral determination. An expedited grievance under
this subdivision applies if a grievance is submitted and a
physician, orally or in writing, substantiates that the time frame
for a grievance under subdivision (k) would seriously jeopardize
the life or health of the insured or enrollee or would jeopardize
the insured's or enrollee's ability to regain maximum function.
(m) That the insured or enrollee has the right to a
determination
of the matter by the commissioner director or his or
her designee or by an independent review organization under the
patient's right to independent review act, 2000 PA 251, MCL
550.1901 to 550.1929.
(2) An insured or enrollee may authorize in writing any
person, including, but not limited to, a physician, to act on his
or her behalf at any stage in a grievance proceeding under this
section.
(3) This section does not apply to a provider's complaint
concerning claims payment, handling, or reimbursement for health
care services.
(4) This section does not apply to a policy, certificate,
care, coverage, or insurance listed in section 5(2) of the
patient's right to independent review act, 2000 PA 251, MCL
550.1905, as not being subject to the patient's right to
independent review act, 2000 PA 251, MCL 550.1901 to 550.1929.
(5) As used in this section:
(a)
"Adverse determination" means a any of the following:
(i) A determination that an
admission, availability of care,
continued
stay, or other health care service has been reviewed and
denied,
reduced, or terminated. by an
insurer or its designee
utilization review organization that a request for a benefit, on
application of any utilization review technique, does not meet the
insurer's requirements for medical necessity, appropriateness,
health care setting, level of care, or effectiveness or is
determined to be experimental or investigational and the requested
benefit is therefore denied, reduced, or terminated or payment is
not provided or made, in whole or in part, for the benefit.
(ii) The denial, reduction, termination, or failure to provide
or make payment, in whole or in part, for a benefit based on a
determination by an insurer or its designee utilization review
organization of a covered person's eligibility for coverage from
the insurer.
(iii) A prospective review or retrospective review
determination that denies, reduces, or terminates or fails to
provide or make payment, in whole or in part, for a benefit.
(iv) A rescission of coverage determination.
(v) Failure to respond in a timely manner to a request for a
determination. constitutes
an adverse determination.
(b) "Grievance" means a formal complaint on behalf of an
insured or enrollee submitted by an insured or enrollee concerning
any of the following:
(i) The availability, delivery, or quality of health care
services, including a complaint regarding an adverse determination
made pursuant to utilization review.
(ii) Benefits or claims payment, handling, or reimbursement
for health care services.
(iii) Matters pertaining to the contractual relationship
between
an insured or enrollee and the insurer. or health
maintenance
organization.
(c) "Postservice grievance" means a grievance relating to
services that have already been received by the insured or
enrollee.
(d) "Preservice grievance" means a grievance relating to
services for which the insurer conditions receipt of the services,
in whole or in part, on approval of the services in advance of
receiving the service.
Sec.
2213a. (1) All The
director shall calculate actual and
necessary
expenses incurred by the commissioner director under
section
2213 shall be calculated by the commissioner by June 30 of
each year for the immediately preceding fiscal year. Except as
otherwise
provided in subsection (2), the commissioner director
shall
divide these expenses among all insurers who that issue
a
policy
or certificate under chapter 34 or 36 35 in this state on a
pro rata basis according to the direct written premiums of each
insurer
as reported in each the insurer's
annual statement for the
immediately
preceding calendar year. by each of those insurers.
This
An insurer shall pay the assessment shall be paid within 30
days
after receipt of the assessment. and The
assessment is in
addition to the regulatory fee provided for in section 224.
(2) This section does not apply to a policy, certificate,
care, coverage, or insurance listed in section 5(2) of the
patient's right to independent review act, 2000 PA 251, MCL
550.1905, as not being subject to the patient's right to
independent review act, 2000 PA 251, MCL 550.1901 to 550.1929.
Sec. 2213b. (1) Except as otherwise provided in this section,
an insurer that delivers, issues for delivery, or renews in this
state
an expense-incurred hospital, medical, or surgical individual
a
health insurance policy under
chapter 34 shall renew the
policy
or
continue the policy in force the policy at the option of the
individual or, for a group plan, at the option of the plan sponsor.
(2)
Except as otherwise provided in this section, an insurer
that
delivers, issues for delivery, or renews in this state an
expense-incurred
hospital, medical, or surgical group policy or
certificate
under chapter 36 shall renew or continue in force the
policy
or certificate at the option of the sponsor of the plan.
(2) At the time of renewal of an individual health insurance
policy, the insurer may modify the policy if the modification is
consistent with state and federal law and is effective on a uniform
basis among all individuals with coverage under the policy.
(3) At the time of renewal of a group health insurance policy
issued under chapter 34, the insurer may modify the policy.
(4) (3)
Guaranteed renewal of a health insurance policy is not
required in cases of fraud, intentional misrepresentation of
material fact, lack of payment, noncompliance with minimum
contribution requirements, or noncompliance with minimum
participation requirements, if the insurer no longer offers that
particular type of coverage in the market, or if the individual or
group moves outside the service area.
(5) (4)
An insurer or health maintenance
organization that
offers
an expense-incurred hospital, medical, or surgical delivers,
issues for delivery, or renews in this state a health insurance
policy
under chapter 34 or 36 shall not discontinue offering a
particular plan or product in the nongroup or group market unless
the
insurer or health maintenance organization does all of the
following:
(a)
Provides notice to the commissioner director and to each
covered individual or group, as applicable, provided coverage under
the plan or product of the discontinuation at least 90 days before
the date of the discontinuation.
(b) Offers to each covered individual or group, as applicable,
provided coverage under the plan or product the option to purchase
any other plan or product currently being offered in the nongroup
market
or group market, as applicable, by that insurer or health
maintenance
organization without excluding or
limiting coverage for
a preexisting condition or providing a waiting period.
(c) Acts uniformly without regard to any health status factor
of enrolled individuals or individuals who may become eligible for
coverage in making the determination to discontinue coverage and in
offering other plans or products.
(6) (5)
An insurer or health maintenance
organization shall
not discontinue offering all coverage in the nongroup or group
market
unless the insurer or health maintenance organization does
all of the following:
(a)
Provides notice to the commissioner director and to each
covered individual or group, as applicable, of the discontinuation
at least 180 days before the date of the expiration of coverage.
(b) Discontinues all health benefit plans issued in the
nongroup
or group market from which the insurer or health
maintenance
organization withdrew and does not
renew coverage under
those plans.
(7) (6)
If an insurer or health
maintenance organization
discontinues
coverage under subsection (5), (6),
the insurer or
health
maintenance organization shall not
provide for the issuance
of any health benefit plans in the nongroup or group market from
which
the insurer or health maintenance organization withdrew
during the 5-year period beginning on the date of the
discontinuation of the last plan not renewed under that subsection.
(8) (7)
Subsections (1) to (6) (7) do
not apply to a short-
term or 1-time limited duration policy or certificate of no longer
than 6 months.
(9) (8)
For the purposes of this section, and
section 3406f, a
short-term or 1-time limited duration policy or certificate of no
longer than 6 months is an individual health policy that meets all
of the following:
(a) Is issued to provide coverage for a period of 185 days or
less, except that the health policy may permit a limited extension
of benefits after the date the policy ended solely for expenses
attributable to a condition for which a covered person incurred
expenses during the term of the policy.
(b) Is nonrenewable, provided that the health insurer may
provide coverage for 1 or more subsequent periods that satisfy
subdivision (a), if the total of the periods of coverage do not
exceed a total of 185 days out of any 365-day period, plus any
additional days permitted by the policy for a condition for which a
covered person incurred expenses during the term of the policy.
(c) Does not cover any preexisting conditions.
(d) Is available with an immediate effective date, without
underwriting, upon receipt by the insurer of a completed
application
indicating eligibility under the health insurer's
eligibility requirements, except that coverage that includes
optional benefits may be offered on a basis that does not meet this
requirement.
(10) (9)
By March 31 each year, an insurer
that delivers,
issues for delivery, or renews in this state a short-term or 1-time
limited duration policy or certificate of no longer than 6 months
shall
provide to the commissioner director
a written annual report
that discloses both of the following:
(a) The gross written premium for short-term or 1-time limited
duration policies or certificates issued in this state during the
preceding calendar year.
(b)
The gross written premium for all individual expense-
incurred
hospital, medical, or surgical health
insurance policies
or
certificates issued or delivered in
this state during the
preceding calendar year other than policies or certificates
described in subdivision (a).
(11) (10)
The commissioner director shall
maintain copies of
reports
prepared pursuant to under
subsection (9) (10) on
file with
the
annual statement of each reporting insurer. The commissioner
director shall annually compile the reports received under
subsection
(9). (10). The commissioner director shall
provide this
annual compilation to the senate and house of representatives
standing
committees on insurance issues no later than the by June
1
immediately
following after the March 31 date for on which
the
reports
under subsection (9) (10) are provided.due.
(12) (11)
In each calendar year, a health an insurer
shall not
continue to issue short-term or 1-time limited duration policies or
certificates if to do so the collective gross written premiums on
those policies or certificates would total more than 10% of the
collective
gross written premiums for all individual expense-
incurred
hospital, medical, or surgical health
insurance policies
or
certificates issued or delivered in
this state either directly
by
that the insurer or through a corporation person that
owns or is
owned
by that the insurer.
Sec.
2214. (1) The An
insured shall is not
be bound by any a
statement made in an application for a disability insurance policy
unless
a copy of such the application is attached to or endorsed on
included
in the policy when the policy is issued. as a part
thereof.
For purposes of this
subsection, an application is not
included in a policy unless the policy specifically states that it
includes the application.
(2) If any such a policy described in subsection (1) that was
delivered
or issued for delivery to any a
person in this state
shall
be is reinstated or renewed , and the insured or the a
beneficiary
or assignee of such the policy shall make makes a
written
request to the insurer for a copy of the any application ,
if
any, for such reinstatement
or renewal, the insurer shall,
within
15 days after the receipt of such receiving the request at
its
the home office or any a branch
office of the insurer, deliver
or
mail to the person making such the
request , a copy of such the
application.
If such the copy shall is not be so delivered
or
mailed as required by this subsection, the insurer shall be is
precluded
from introducing such the application as evidence in any
an
action or proceeding based upon on or
involving such the policy
or
its the reinstatement or renewal.
Sec.
2236. (1) A Except as
otherwise provided in this section,
an insurer shall not deliver or issue for delivery in this state a
basic
insurance policy form or annuity contract form; shall not be
issued
or delivered to any person in this state, and an insurance
or
annuity application form if a written application is required
and
is to be made a part of the policy or contract, a printed rider
or
indorsement form or form of renewal certificate; , and or a
group
certificate in connection with the policy or contract ,
shall
not
be issued or delivered to a person in this state, until unless
a
copy of the form is filed with the department of insurance and
financial
services and approved by the
director of the department
of
insurance and financial services as
conforming with the
requirements
of this act and not inconsistent with the law. Failure
of
A form is considered approved
if the director of the department
of
insurance and financial services fails
to act within 30 days
after
its submittal constitutes approval. A form described
in this
section,
except a policy of disability insurance as defined under
this section. Except for disability insurance as described in
section
3400, must be an insurer
shall plainly printed print the
form with a type size of not less than 8-point unless the director
of
the department of insurance and financial services determines
that portions of the form that are printed with type less than 8-
point
is are not deceptive or misleading.
(2) An insurer may satisfy its obligations to make form
filings by becoming a member of, or a subscriber to, a rating
organization
licensed under section 2436 or 2630 that makes those
the
filings and by filing that are required under this section. An
insurer described in this subsection shall file with the director
of
the department of insurance and financial services a copy of its
authorization of the rating organization to make the filings on its
behalf.
Every Except as otherwise
provided in this subsection, an
insurer that is a member of or subscriber to a rating organization
shall adhere to the form filings made on its behalf by the
organization. except
that an An insurer may file with the director
of
the department of insurance and financial services a substitute
form , and thereafter if a subsequent form filing by
the rating
organization after the filling of a substitute form affects the use
of the substitute form, the insurer shall review its use and notify
the
director of the department of insurance and financial services
whether to withdraw its substitute form.
(3)
Beginning January 1, 1992, the The
director of the
department
of insurance and financial services shall
not approve a
form
filed under this section providing that provides for or
relating
relates to an insurance policy or an annuity contract for
personal, family, or household purposes if the form fails to obtain
the following readability score or meet the other requirements of
this subsection, as applicable:
(a) The readability score must not be less than 45, as
determined by the method provided in subdivisions (b) and (c).
(b)
The readability score shall be is
determined as follows:
(i) For a form containing not more than 10,000 words, the
entire
form shall must be analyzed. For a form containing more than
10,000
words, not less fewer than two 200-word samples per page
shall
must be analyzed instead of the entire form. The samples
must
be separated by at least 20 printed lines.
(ii) Count the number of words and sentences in the form or
samples and divide the total number of words by the total number of
sentences. Multiply this quotient by a factor of 1.015.
(iii) Count the total number of syllables in the form or
samples and divide the total number of syllables by the total
number of words. Multiply this quotient by a factor of 84.6. As
used in this subparagraph, "syllable" means a unit of spoken
language consisting of 1 or more letters of a word as indicated by
an accepted dictionary. If the dictionary shows 2 or more equally
acceptable pronunciations of a word, the pronunciation containing
fewer syllables may be used.
(iv) Add the figures obtained in subparagraphs (ii) and (iii)
and subtract this sum from 206.835. The figure obtained equals the
readability score for the form.
(c) For the purposes of subdivision (b)(ii) and (iii), the
following
procedures shall must be used:
(i) A contraction, hyphenated word, or numbers and letters
when
separated by spaces is are
counted as 1 word.
(ii) A unit of words ending with a period, semicolon, or
colon, but excluding headings and captions, is counted as 1
sentence.
(d) In determining the readability score, all of the following
apply to the method provided in subdivisions (b) and (c):
(i) Shall It must be applied to an
insurance policy form or an
annuity
contract , together
with a rider or indorsement form
usually associated with the insurance policy form or annuity
contract. It may be applied to a group of policy, contract, rider,
or indorsement forms that have substantially the same language
resulting in a single readability score for those forms.
(ii) Shall It must not be applied to words
or phrases a word
or
phrase that are is defined
in an insurance policy form , or
an
annuity
contract , or riders,
indorsements, a rider,
indorsement,
or
group certificates under an certificate
associated with the
insurance policy form or annuity contract.
(iii) Shall It must not be applied to
language specifically
agreed upon through collective bargaining or required by a
collective bargaining agreement.
(iv) Shall It must not be applied to
language that is
prescribed
by or based on state or federal statute or by any
related
rules, or regulations, promulgated
under a state or federal
statute.or orders.
(v) It must not be applied to medical terms that are included
in the form for coverage purposes.
(e) The form must contain both of the following:
(i) Topical captions.
(ii) An identification of exclusions.
(f)
Each Except as otherwise
provided in this subdivision, an
insurance
policy and or annuity contract that has more than 3,000
words printed on not more than 3 pages of text or that has more
than 3 pages of text regardless of the number of words must contain
a table of contents. This subdivision does not apply to riders or
indorsements.
(g) Each rider or indorsement form that changes coverage must
do all of the following:
(i) Contain a properly descriptive title.
(ii) Reproduce either the entire paragraph or the provision as
changed.
(iii) Be At
the time of filing, be accompanied by
an
explanation of the change.
(h)
If a computer system approved by the director of the
department
of insurance and financial services calculates
the
readability score of a form as being in compliance with this
subsection, the form is considered in compliance with the
readability score requirements of this subsection.
(i) A variable life product or variable annuity product
approved
by the United States securities and exchange commission
Securities and Exchange Commission for sale in this state is
compliant
considered in compliance with this section.
(4)
After January 1, 1992, any An
insurer shall submit for
approval under subsection (3) a change or addition to a policy or
annuity contract form for personal, family, or household purposes,
whether by indorsement, rider, or otherwise, or a change or
addition
to a rider or indorsement form to associated with the
policy
form or annuity contract form, which policy or annuity
contract
if the form has not been previously approved under
subsection
(3) , shall be submitted for approval under subsection
(3).and the change or addition significantly
changes the meaning of
the original text.
(5)
Upon written notice to the insurer, the director of the
department
of insurance and financial services may, on a case-by-
case review, disapprove, withdraw approval, or prohibit the
issuance,
advertising, or delivery of any a
form to any person in
this
state if the form violates this act
, or contains
inconsistent,
ambiguous, or misleading clauses.
, or contains
exceptions
and conditions that unreasonably or deceptively affect
the
risk purported to be assumed in the general coverage of the
policy.
The director shall specify in the notice
must specify the
objectionable provisions or conditions and state the reasons for
the
director of the department of insurance and financial services'
decision. If the form is legally in use by the insurer in this
state,
the notice must director
shall give the effective date of
the
director of the department of insurance and financial services'
disapproval in the notice, which shall must
not be less than 30
days after the mailing or delivery of the notice to the insurer. If
the form is not legally in use, the disapproval is effective
immediately.
(6) If a form is disapproved or approval is withdrawn under
this
act, the insurer is entitled upon on demand to a hearing
before
the director of the department of insurance and financial
services
or a deputy director of the
department of insurance and
financial
services within 30 days after the
notice of disapproval
or
of withdrawal of approval. After the hearing, the director of
the
department of insurance and financial services shall make
findings
of fact and law , and either
affirm, modify, or withdraw
his or her original order or decision. An insurer shall not issue
the form after a final determination of disapproval or withdrawal
of approval.
(7)
Any issuance, use, or delivery by an insurer of any a form
without
the prior approval of the director of the department of
insurance
and financial services as required by
under subsection
(1)
or after withdrawal of approval as provided by under subsection
(5)
is a separate violation for which the director of the
department
of insurance and financial services may
order the
imposition
of a civil penalty of $25.00 for each offense, but not
to
exceed the a maximum penalty of $500.00 for any 1 series of
offenses
relating to any 1 basic policy form.
, which The attorney
general
may act to recover the penalty may
be recovered by the
attorney
general under this subsection
as provided in section 230.
(8) The filing requirements of this section do not apply to
any of the following:
(a) Insurance against loss of or damage to any of the
following:
(i) Imports, exports, or domestic shipments.
(ii) Bridges, tunnels, or other instrumentalities of
transportation and communication.
(iii) Aircraft and attached equipment.
(iv) Vessels and watercraft that are under
construction, or
are
owned by or used in a business, or having
have a straight-line
hull length of more than 24 feet.
(b) Insurance against loss resulting from liability, other
than worker's disability compensation or employers' liability
arising out of the ownership, maintenance, or use of any of the
following:
(i) Imports, exports, or domestic shipments.
(ii) Aircraft and attached equipment.
(iii) Vessels and watercraft that are under
construction, or
are
owned by or used in a business, or having
have a straight-line
hull length of more than 24 feet.
(c) Surety bonds other than fidelity bonds.
(d) Policies, riders, indorsements, or forms of unique
character
designed for and used with relation to insurance upon on
a particular subject, or that relate to the manner of distribution
of benefits or to the reservation of rights and benefits under life
or disability insurance policies and are used at the request of the
individual policyholder, contract holder, or certificate holder.
Beginning
September 1, 1968, the director of the department of
insurance
and financial services by By order,
the director may
exempt from the filing requirements of this section and sections
2242,
3606, 3401a and 4430 for so as long
as he or she considers
proper any insurance document or form, except that portion of the
document or form that establishes a relationship between group
disability insurance and personal protection insurance benefits
subject to exclusions or deductibles under section 3109a, as
specified in the order to which this section is not practicably
applied, or the filing and approval of which are considered
unnecessary for the protection of the public. Insurance documents
or forms providing medical payments or income replacement benefits,
except that portion of the document or form that establishes a
relationship between group disability insurance and personal
protection insurance benefits subject to exclusions or deductibles
under
section 3109a, exempt by order of the director of the
department
of insurance and financial services from
the filing
requirements
of this section and sections 2242 and 3606 section
3401a
are considered approved by the director
of the department of
insurance
and financial services for purposes
of section 3430.
(e)
Insurance that meets An
insurance policy to which both of
the following apply:
(i) Is The
insurance is sold to an exempt
commercial
policyholder.
(ii) Contains The insurance policy contains a
prominent
disclaimer that states "This policy is exempt from the filing
requirements of section 2236 of the insurance code of 1956, 1956 PA
218, MCL 500.2236." or words that are substantially similar.
(9) Notwithstanding any provision of this act to the contrary,
a health insurer may satisfy a requirement for the delivery of an
insurance form or notice required by this act to a subscriber,
insured, enrollee, or contract holder by doing all of the
following:
(a) Taking appropriate and necessary measures reasonably
calculated to ensure that the system for furnishing a form or
notice meets all of the following requirements:
(i) It results in the actual receipt of a delivered form or
notice.
(ii) It protects the confidentiality of a subscriber's,
insured's, enrollee's, or contract holder's personal information.
(b) Ensuring that an electronically delivered form or notice
is prepared and furnished in a manner consistent with the style,
format, and content requirements applicable to the particular form
or notice.
(c) On request, delivering to the subscriber, insured,
enrollee, or contract holder a paper version of an electronically
delivered form or notice.
(10) (9)
As used in this section and sections
2401 and 2601,
"exempt commercial policyholder" means an insured that purchases
the insurance for other than personal, family, or household
purposes.
(11) (10)
Every An order made by the director of the
department
of insurance and financial services under
the provisions
of
this section is subject to court
review as provided in section
244.
Sec.
2237. No policy of An
insurer shall not deliver in this
state
an insurance policy issued
under the provisions of chapters
chapter
34, and 36 of this act, to
take effect after June 30, 1962,
shall
contain any or issue the
policy for delivery in this state,
if
the policy contains a provision restricting
that restricts the
liability
of the insurer with respect to pay
expenses , for which
payment
would be legally required in the absence of insurance, on
the
ground that such because the expenses were are incurred while
the
person insured is in a hospital, institution, or
other facility
operated
by the this state or a political subdivision thereof.of
this state if the insured would be legally required to pay the
expenses in the absence of insurance.
Sec.
3400. (1) The term "policy of disability insurance" as As
used
in this chapter, "disability
insurance policy" includes any an
insurance
policy or insurance contract of insurance that
insures
against loss resulting from sickness or from bodily injury or death
by accident, or both, including also the granting of specific
hospital benefits and medical, surgical, and sick-care benefits to
any
person, an individual, family, or group, subject to the
exclusions
set forth or referred to in provided
in this section.
(2)
Nothing in this This chapter shall does not apply to or
affect any of the following:
(a)
Any policy of A liability or workmen's worker's disability
compensation
insurance policy, with or without regardless of
whether
supplementary expense coverage therein;is included.
(b)
Any policy or contract of A
reinsurance ;
orpolicy or
contract.
(c) Life insurance, endowment, or annuity contracts, or
contracts
supplemental thereto which to
life insurance, endowment,
or
annuity contracts, that only contain only
such provisions
relating
to disability insurance as (i) provide that do any of the
following:
(i) Provide additional benefits in case of death or
dismemberment
or loss of sight by accident. , or as (ii) operate
(ii) Operate to safeguard such
the contracts against lapse ,
or
to give a special surrender value, or special benefit, or an
annuity
in the event that the insured or annuitant shall become
becomes totally and permanently disabled, as defined by the
contract
or supplemental contract. ; all of which A supplemental
contracts
shall be issuable contract described
in this subparagraph
must be issued under the authority of section 602.
(3)
The An insurer may omit
the provisions of this chapter
contained
in required under sections 3407, (entire contract;
changes),
3411, (reinstatement), and
3420 (physical examinations
and
autopsy), may be omitted from
ticket policies sold only to
passengers by common carriers.
(4)
Section 3475 of this chapter shall apply applies to group,
blanket, or family expense disability insurance contracts and the
remaining
provisions of this chapter shall apply to such group,
blanket, or family expense disability insurance contracts only as
provided
in this chapter. 36.
Sec. 3400a. (1) As used in this chapter, "group disability
insurance" means voluntary disability insurance that covers 2 or
more employees or members, with or without their eligible
dependents, written under a master policy issued to a governmental
corporation, unit, agency, or department of a governmental entity,
to a corporation, copartnership, or individual employer, or, on
application of an executive officer or trustee of the association,
to an association that has a constitution or bylaws and that is
formed in good faith for purposes other than that of obtaining
insurance, and under which officers, members, employees, or classes
or departments of the association may be insured for their
individual benefit.
(2) Notwithstanding subsection (1), a group disability
insurance policy may be issued to a trust or trustees of a fund
established by 2 or more employers to insure 1 or more employees of
the employers.
Sec. 3400b. As used in this chapter, "health insurance policy"
means an expense-incurred hospital, medical, or surgical policy,
certificate, or contract.
Sec. 3401a. (1) An insurer authorized to write disability
insurance in this state may issue group disability insurance
policies.
(2) Except as otherwise provided in section 2236(8)(d), an
insurer shall not deliver or issue for delivery in this state a
group disability insurance policy unless a copy of the form has
been filed with and approved by the director.
Sec.
3402. No policy of An
insurer shall not deliver or issue
for
delivery in this state a disability
insurance , as defined in
section
3400 (1), shall be delivered or issued for delivery to any
person
in this state policy for an
individual or family unless all
of the following requirements are met:
(a) (1)
The entire money and other
considerations therefor for
the
policy are expressed therein; andin the policy.
(b) (2)
The time at which the insurance
takes effect and
terminates
is expressed therein; andin
the policy.
(c) (3)
It purports to insure Except as
otherwise provided in
this
subdivision, only 1 person, except
that a individual is
insured under the policy. A disability insurance policy may insure,
originally or by subsequent amendment, upon the application of an
adult
member of a family who shall be deemed is the policyholder,
any 2 or more eligible members of that family, including husband,
wife, dependent children or any children under a specified age,
which
shall not exceed 19 years and any
other person individual
dependent
upon the policyholder. ; andThe
age specified in a policy
under this subdivision must not exceed 19 years or, if the policy
is a health insurance policy, 26 years.
(4)
The style, arrangement and over-all appearance of the
policy
give no undue prominence to any portion of the text, and
unless
every printed portion of the text of the policy and of any
endorsements
or attached papers is plainly printed in light-faced
type
of a style in general use, the size of which shall be uniform
and
not less than 10-point with a lower-case unspaced alphabet
length,
not less than 120-point in length of line (the "text" shall
include
all printed matter except the name and address of the
insurer,
name or title of the policy, the brief description, if
any,
and captions and subcaptions); and
(5)
The exceptions and reductions of indemnity are set forth
in
the policy and, except those which are set forth in sections
3406
through 3454, are printed, at the insurer's option, either
included
with the benefit provision to which they apply, or under
an
appropriate caption such as "EXCEPTIONS", or "EXCEPTIONS AND
REDUCTIONS": Provided, That if an exception or reduction
specifically
applies only to a particular benefit of the policy, a
statement
of such exception or reduction shall be included with the
benefit
provision to which it applies; and
(6)
Each such form, including riders and endorsements, shall
be
identified by a form number in the lower left-hand corner of the
first
page thereof; and
(7)
It contains no provision purporting to make any portion of
the
charter, rules, constitution or bylaws of the insurer a part of
the
policy unless such portion is set forth in full in the policy,
except
in the case of the incorporation of, or reference to, a
statement
of rates or classification of risks, or short-rate table
filed
with the commissioner.
Sec. 3402a. An insurer shall include all of the following
provisions in a group disability insurance policy:
(a) That the policy, application of the employer or of an
executive officer or trustee of an association, and the individual
applications, if any, of the employees or members insured,
constitute the entire contract between the parties. The insurer's
identification of what constitutes the entire contract creates a
rebuttable presumption that the identified items are the entire
contract.
(b) That a statement made by the employer, the executive
officer or trustee of an association, or an individual employee or
member, in the absence of fraud, is a representation and not a
warranty. An insurer shall not use a statement made by the
employer, the executive officer or trustee of an association, or an
individual employee or member as a defense to a claim under the
policy, unless the statement is contained in a written application.
(c) That the insurer will issue to the employer or the
executive officer or trustee of an association, for delivery to an
employee or member who is insured under the policy, an individual
certificate that states the insurance protection to which the
employee or member is entitled and to whom benefits are payable.
(d) That new employees or members, as applicable, who are
eligible and who apply will be added to the group or class
originally insured.
Sec. 3402b. (1) Subject to the coordination of benefits act,
1984 PA 64, MCL 550.251 to 550.255, an insurer may include in a
group or nongroup disability insurance policy a provision for the
coordination of benefits otherwise payable under the policy with
benefits payable for the same loss under other group or nongroup
disability insurance. An insurer that does not include in a group
or nongroup disability insurance policy a provision for the
coordination of benefits as described in this subsection shall
coordinate benefits under the policy in the manner prescribed in
the coordination of benefits act, 1984 PA 64, MCL 550.251 to
550.255.
(2) Subject to subsection (1), an insurer may include a
provision in a group or nongroup disability insurance policy that
benefits payable by the policy may be limited if there is other
valid coverage with another insurer that provides benefits for the
same loss on an expense-incurred basis. The insurer may provide
that if it is not given written notice on the application for
coverage that the other valid coverage exists, or if other coverage
is acquired after the effective date of the coverage, the only
liability under any expense-incurred coverage of the policy is the
amount of the covered claim that exceeds the benefits payable by
the other coverage. An insurer may apply benefits paid or payable
by the primary insurer to satisfy any deductibles, coinsurance, and
copayments with the policy. An insurer shall not apply payments
made by a primary insurer to reduce the policy maximum limits on
the policy. As used in this subsection, "other coverage" includes a
plan that provides coverage under a health insurance policy,
hospital or medical service subscriber contract, medical practice
or other prepayment plan, or other expense-incurred plan or
program. Other coverage does not include Medicaid, hospital daily
indemnity plans, specified disease only policies, or limited
occurrence policies that provide only for intensive care or
coronary care at a hospital, first aid outpatient medical expenses
resulting from accidents, or specified accidents such as travel
accidents.
(3) If there are more than 1 group or nongroup disability
insurance policies that cover the same loss and contain a provision
described in subsection (2), and the insurers each pay a share of
the covered expenses for the claim, neither insurer is required to
pay more than it would have paid had it been the primary insurer.
Sec. 3402c. (1) For purposes of this chapter, family expense
insurance is accident and health insurance that is written under 1
policy issued to the head of a family who may be either spouse and
that insures the head of the family and 1 or more dependents,
including a nondependent spouse. Benefits under a family expense
insurance policy, except as applied to the head of the family, do
not include indemnification for loss of time from any cause.
(2) An insurer authorized to write accident and health
insurance in this state may issue family expense insurance
policies.
(3) An insurer shall not deliver or issue for delivery in this
state a family expense insurance policy unless a copy of the form
of the policy is filed with and approved by the director.
(4) An insurer shall include in a family expense insurance
policy the applicable provisions of sections 3406 to 3466 and all
of the following provisions:
(a) That the policy and the application signed by the
individual acting as the head of the family for the purpose of
family expense insurance constitute the entire contract between the
parties. The insurer's identification of what constitutes the
entire contract creates a rebuttable presumption that the
identified items are the entire contract.
(b) That a statement made by the head of the family, in the
absence of fraud, is a representation and not a warranty. An
insurer shall not use a statement made by the head of the family as
a defense to a claim under the policy, unless the statement is
contained in a written application.
(c) That new members of the family who are eligible, on
application of the head of the family, will be added to the family
group originally insured.
(5) A family expense insurance policy is subject to sections
3474 and 3474a.
Sec. 3402d. (1) For purposes of this chapter, blanket
disability insurance is disability insurance that covers special
groups of individuals, as follows:
(a) A policy issued to a common carrier as the policyholder
and that covers a group defined as all individuals who are
passengers of the common carrier.
(b) A policy issued to an employer as the policyholder and
that covers all employees or any group of employees defined by
reference to exceptional hazards incidental to the employment.
(c) A policy issued to a university, college, school, or other
educational institution, or to the head or principal of the
university, college, school, or institution as the policyholder,
that covers students or teachers.
(d) A policy issued to a volunteer fire department, first aid
group, or other volunteer group as the policyholder that covers all
of the members of the department or group.
(e) A policy issued to a creditor as the policyholder that
insures debtors of the creditor.
(f) A policy issued to a sports team or camp as the
policyholder that covers members or campers.
(2) In the discretion of the director, blanket disability
insurance may be issued to any other special group of individuals
that is substantially similar to a group described in subsection
(1).
Sec. 3402e. (1) An insurer authorized to write disability
insurance in this state may issue blanket disability insurance
policies.
(2) An insurer shall not deliver or issue for delivery in this
state a blanket disability insurance policy unless a copy of the
form of the policy is filed with and approved by the director.
(3) A blanket disability insurance policy is subject to
sections 3474 and 3474a.
Sec. 3402f. An insurer shall include in a blanket disability
insurance policy the applicable provisions of sections 3406 to 3466
and all of the following provisions:
(a) That the policy and the application signed by the
policyholder constitute the entire contract between the parties.
The insurer's identification of what constitutes the entire
contract creates a rebuttable presumption that the identified items
are the entire contract.
(b) That a statement made by the policyholder, in the absence
of fraud, is a representation and not a warranty. An insurer shall
not use a statement made by the policyholder as a defense to a
claim under the policy, unless the statement is contained in a
written application.
(c) That individuals who are eligible for coverage, on
application of the policyholder, will be added to the group or
class originally insured.
Sec. 3402g. (1) An insurer shall not require an individual
application from an individual covered under a blanket disability
insurance policy. The director may require the insurer to furnish a
certificate to each individual insured under a blanket disability
policy.
(2) Except as otherwise provided in this subsection, an
insurer shall pay benefits under a blanket disability insurance
policy to the insured or to the insured's designated beneficiary or
estate. If the insured is a minor or developmentally disabled, an
insurer may pay benefits under a blanket disability insurance
policy to the insured's parent, guardian, or other person to which
the insured is a dependent. An insurer may provide in a blanket
disability insurance policy that, with the consent of the insured,
the benefits may be paid directly to a person that legally
furnishes hospital, medical, surgical, or sick-care services to the
insured, within the limits under the policy and without other
preference as to creditors.
Sec. 3402h. Sections 3402d to 3402g do not affect the legal
liability of a policyholder for the death of or injury to an
employee, member, or other individual insured under the blanket
disability insurance policy.
Sec.
3403. (1) Individual disability insurance policies
providing
An insurer that delivers,
issues for delivery, or renews
in this state a health insurance policy that offers dependent
coverage
on an expense incurred basis which provide coverage for a
family
member of the insured shall, as to that family member's
coverage,
also provide that shall
include both of the following
provisions in the policy:
(a)
That the disability health insurance
benefits applicable
for
children shall be are payable with respect to a newly born
child of the insured from the moment of birth.
(b) (2)
The That the coverage for newly born children shall
consist
consists of coverage of injury or sickness including the
necessary care and treatment of medically diagnosed congenital
defects and birth abnormalities.
(2) (3)
If payment of a specific premium is
required to
provide coverage for a child under a health insurance policy, an
insurer
may include a provision in the policy may
require that
notification
that requires the insured to
notify the insurer of the
birth
of a newly born child and payment of pay the required premium
shall
be furnished to the insurer within
31 days after the date of
birth in order to have the coverage continue beyond the 31-day
period.
(3) An insurer that delivers, issues for delivery, or renews
in this state a health insurance policy that offers dependent
coverage shall not deny enrollment to an insured's child on any of
the following grounds:
(a) The child was born out of wedlock.
(b) The child is not claimed as a dependent on the insured's
federal income tax return.
(c) The child does not reside with the insured or in the
insurer's service area.
Sec.
3404. If any The director
may require that a policy is
issued by an insurer domiciled in this state for delivery to a
person
residing in another state , and meet
the standards
prescribed in sections 2212a, 3402, and 3406 to 3466 if the
official
having responsibility that
is responsible for the
administration
of the insurance laws of such the
other state shall
have
advised advises the commissioner director that
any such the
policy
is not subject to approval or disapproval by such the
official. ,
the commissioner may by ruling require that such policy
meet
the standards set forth in section 3402 and in sections 3406
through
3466.
Sec. 3405. (1) For the purpose of doing business as an
organization under the prudent purchaser act, 1984 PA 233, MCL
550.51 to 550.63, an insurer authorized in this state to write
disability
health insurance that provides coverage for hospital,
nursing,
medical, surgical, or sick-care benefits may enter into
prudent purchaser agreements with providers of hospital, nursing,
medical, surgical, or sick-care services pursuant to this section
and the prudent purchaser act, 1984 PA 233, MCL 550.51 to 550.63.
(2)
An insurer may offer disability health
insurance policies
under which the insured persons shall be required, as a condition
of
coverage, to obtain hospital, nursing, medical, surgical, or
sick-care
health care services exclusively from health care
providers
who have entered into prudent purchaser agreements. A
person
to whom a policy described in this subsection is offered
shall
also be offered a policy that does not do any of the
following:
(a)
As a condition of coverage, require insured persons to
obtain
services exclusively from health care providers who have
entered
into prudent purchaser agreements.
(b)
Give a financial advantage or other advantage to an
insured
person who elects to obtain services from health care
providers
who have entered into prudent purchaser agreements.
(3)
An insurer may offer disability health
insurance policies
under
which insured persons who elect to obtain hospital, nursing,
medical,
surgical, or sick-care health
care services from health
care providers who have entered into prudent purchaser agreements
realize a financial advantage or other advantage by selecting
providers who have entered into prudent purchaser agreements.
Policies offered under this subsection shall not, as a condition of
coverage, require insured persons to obtain hospital, nursing,
medical, surgical, or sick-care services exclusively from health
care
providers who have entered into prudent purchaser agreements.
A
person to whom a policy described in this subsection is offered
shall
also be offered a policy that does not do any of the
following:
(a)
As a condition of coverage, require insured persons to
obtain
services exclusively from health care providers who have
entered
into prudent purchaser agreements.
(b)
Give a financial advantage or other advantage to an
insured
person who elects to obtain services from health care
providers
who have entered into prudent purchaser agreements.
(4) An insurer shall not charge rates for coverage under
policies issued under this section that are unreasonably lower than
what is necessary to meet the expenses of the insurer for providing
this
the coverage and or that have an
anticompetitive effect or
result in predatory pricing in relation to prudent purchaser
agreement coverages offered by other organizations.
(5) An insurer shall not discriminate against a class of
health care providers when entering into prudent purchaser
agreements with health care providers for its provider panel. This
subsection does not do any of the following:
(a) Prohibit the formation of a provider panel consisting of a
single class of providers if a service provided for in the
specifications of a purchaser may legally be provided only by a
single class of providers.
(b) Prohibit the formation of a provider panel that conforms
to the specifications of a purchaser of the coverage authorized by
this section if the specifications do not exclude any class of
health care providers who may legally perform the services included
in the coverage.
(c) Require an organization that has uniformly applied the
standards filed under section 3(3) of the prudent purchaser act,
1984 PA 233, MCL 550.53, to contract with any individual provider.
(6)
Nothing in 1984 PA 280 applies to any contract that is in
existence
before December 20, 1984, or the renewal of that
contract.
(6) (7)
Notwithstanding any other provision
of this act to the
contrary, if coverage under a prudent purchaser agreement provides
for benefits for services that are within the scope of practice of
optometry, an insurer is not required to provide coverage or
reimburse for a practice of optometry service unless that service
was included in the definition of practice of optometry under
section 17401 of the public health code, 1978 PA 368, MCL
333.17401, as of May 20, 1992.
(7) (8)
Notwithstanding any other provision
of this act to the
contrary, if coverage under a prudent purchaser agreement provides
for benefits for services that are within the scope of practice of
chiropractic, an insurer is not required to provide coverage or
reimburse for a practice of chiropractic service unless that
service was included in the definition of practice of chiropractic
under section 16401 of the public health code, 1978 PA 368, MCL
333.16401, as of January 1, 2009.
(8) (9)
Notwithstanding any other provision
of this act to the
contrary, if coverage under a prudent purchaser agreement provides
for benefits for services that are provided by a licensed physical
therapist or physical therapist assistant under the supervision of
a licensed physical therapist, an insurer is not required to
provide coverage or reimburse for services provided by a physical
therapist or a physical therapist assistant unless that service was
provided by a licensed physical therapist or physical therapist
assistant under the supervision of a licensed physical therapist
pursuant to a prescription from a health care professional who
holds a license issued under part 166, 170, 175, or 180 of the
public health code, 1978 PA 368, MCL 333.16601 to 333.16648,
333.17001 to 333.17084, 333.17501 to 333.17556, and 333.18001 to
333.18058, or the equivalent license issued by another state.
Sec.
3406a. A hospital, medical or surgical expense incurred
An insurer that delivers, issues for delivery, or renews in this
state a health insurance policy shall offer benefits for prosthetic
devices to maintain or replace the body parts of an individual who
has
undergone a mastectomy. This coverage shall must provide
that
reasonable charges for medical care and attendance for an
individual who receives reconstructive surgery following a
mastectomy
or who is fitted with a prosthetic device shall be are
covered benefits after the individual's attending physician has
certified the medical necessity or desirability of a proposed
course of rehabilitative treatment. The cost and fitting of a
prosthetic device following a mastectomy is included within the
type
of coverage intended by required
under this section.
Sec. 3406c. (1) An insurer that delivers, issues for delivery,
or
renews in this state an expense-incurred hospital, medical, or
surgical
a health insurance policy that provides coverage for
inpatient hospital care shall offer to include coverage for hospice
care.
As used in this section, "hospice" means hospice as defined
in
section 20106 of the public health code, Act No. 368 of the
Public
Acts of 1978, being section 333.20106 of the Michigan
Compiled
Laws.a health care program
that provides a coordinated set
of services rendered at home or in outpatient or institutional
settings for individuals suffering from a disease or condition with
a terminal prognosis.
(2) If hospice care coverage is provided, an insurer shall
include
a description of the hospice coverage shall
be included in
communications sent to the insured.
Sec. 3406d. (1) Subject to dollar limits, deductibles, and
coinsurance provisions that are not less favorable than those for
physical
illness generally, an insurer which that delivers, issues
for
delivery, or renews in this state a hospital, medical, or
surgical
expense incurred health
insurance policy shall offer or
include coverage for breast cancer diagnostic services, breast
cancer outpatient treatment services, and breast cancer
rehabilitative services.
(2) Subject to dollar limits, deductibles, and coinsurance
provisions that are not less favorable than those for physical
illness
generally, an insurer which that
delivers, issues for
delivery,
or renews in this state a hospital, medical, or surgical
expense
incurred health insurance policy shall offer or include the
following coverage for breast cancer screening mammography:
(a) If performed on a woman 35 years of age or older and under
40 years of age, coverage for 1 screening mammography examination
during that 5-year period.
(b) If performed on a woman 40 years of age or older, coverage
for 1 screening mammography examination every calendar year.
(3) As used in this section:
(a) "Breast cancer diagnostic services" means a procedure
intended to aid in the diagnosis of breast cancer, delivered on an
inpatient or outpatient basis, including but not limited to
mammography, surgical breast biopsy, and pathologic examination and
interpretation.
(b) "Breast cancer rehabilitative services" means a procedure
intended to improve the result of, or ameliorate the debilitating
consequences of, treatment of breast cancer, delivered on an
inpatient or outpatient basis, including but not limited to
reconstructive plastic surgery, physical therapy, and psychological
and social support services.
(c) "Breast cancer screening mammography" means a standard 2-
view per breast, low-dose radiographic examination of the breasts,
using equipment designed and dedicated specifically for
mammography, in order to detect unsuspected breast cancer.
(d) "Breast cancer outpatient treatment services" means a
procedure intended to treat cancer of the human breast, delivered
on an outpatient basis, including but not limited to surgery,
radiation therapy, chemotherapy, hormonal therapy, and related
medical follow-up services.
(4)
This section shall take effect November 1, 1989.
Sec.
3406e. An insurer which that
delivers, issues for
delivery,
or renews in this state a hospital, medical, or surgical
expense
incurred health insurance policy shall provide coverage in
each policy for a drug used in antineoplastic therapy and the
reasonable
cost of its administration. Coverage shall must be
provided
for any federal food and drug administration United States
Food and Drug Administration approved drug regardless of whether
the specific neoplasm for which the drug is being used as treatment
is the specific neoplasm for which the drug has received approval
by
the federal food and drug administration United States Food and
Drug Administration if all of the following conditions are met:
(a) The drug is ordered by a physician for the treatment of a
specific type of neoplasm.
(b)
The drug is approved by the federal food and drug
administration
United States Food and Drug
Administration for use
in antineoplastic therapy.
(c) The drug is used as part of an antineoplastic drug
regimen.
(d) Current medical literature substantiates its efficacy and
recognized oncology organizations generally accept the treatment.
(e) The physician has obtained informed consent from the
patient
for the treatment regimen which that
includes federal food
and
drug administration United
States Food and Drug Administration
approved drugs for off-label indications.
Sec. 3406j. (1) An insurer that delivers, issues for delivery,
or
renews in this state an expense-incurred hospital, medical, or
surgical
a health insurance policy or certificate shall not rate,
cancel coverage on, refuse to provide coverage for, or refuse to
issue
or renew a health insurance policy or certificate solely
because an insured or applicant for insurance is or has been a
victim of domestic violence.
(2)
This section does not prohibit an insurer from inquiring
about,
underwriting, or charging a different premium on the basis
of
the individual's physical or mental condition, regardless of the
cause
of the condition.
(2) (3)
An insurer shall is not
be held civilly liable for any
cause of action that may result from compliance with this section.
(4)
This section applies to policies and certificates issued
or
renewed on or after June 1, 1998.
(3) (5)
As used in this section,
"domestic violence" means
inflicting bodily injury on, causing serious emotional injury or
psychological trauma to, or placing in fear of imminent physical
harm by threat or force a person who is a spouse or former spouse
of, has or has had a dating relationship with, resides or has
resided with, or has a child in common with the person committing
the violence.
Sec.
3406k. (1) An expense-incurred hospital, medical, or
surgical
policy or certificate delivered, issued insurer that
delivers,
issues for delivery, or renewed renews in
this state a
health insurance policy that provides coverage for emergency health
services
and a health maintenance organization contract shall
provide coverage for medically necessary services provided to an
insured for the sudden onset of a medical condition that manifests
itself by signs and symptoms of sufficient severity, including
severe pain, such that a prudent layperson who possesses an average
knowledge of health and medicine could reasonably expect the
absence
of immediate medical attention could reasonably be expected
to result in serious jeopardy to the individual's health or to a
pregnancy in the case of a pregnant woman, serious impairment to
bodily functions, or serious dysfunction of any bodily organ or
part. An insurer shall not require a physician to transfer a
patient before the physician determines that the patient has
reached the point of stabilization. An insurer shall not deny
payment for emergency health services up to the point of
stabilization provided to an insured under this subsection because
of either of the following:
(a) The final diagnosis.
(b)
Prior authorization was not being
given by the insurer
before emergency health services were provided.
(2) As used in this section, "stabilization" means the point
at which no material deterioration of a condition is likely, within
reasonable medical probability, to result from or occur during
transfer of the patient.
Sec. 3406l. (1) Except as otherwise provided in subsections
(2)
and (3), an expense-incurred hospital, medical, or surgical
insurer that delivers, issues for delivery, or renews in this state
a
health insurance policy or
certificate that provides benefits for
emergency services shall provide for direct reimbursement to any
provider of covered medical transportation services or shall
provide that payment be made jointly to the insured and the
provider,
if that the provider has not received payment for those
services from any other source.
(2) Subsection (1) does not apply to a transaction between an
insurer and a medical transportation service provider if the
parties have entered into a contract providing for direct payment.
(3)
An insurer for a policy or certificate issued under
section
3405 or 3631 does not have to provide for direct
reimbursement to any nonaffiliated or nonparticipating provider for
medical transportation services that were not emergency health
services
as defined described in section 3406k.
(4)
Subsection (1) applies to an expense-incurred hospital,
medical,
or surgical policy or certificate that provides benefits
for
emergency health services if the policy or certificate is
delivered,
issued for delivery, or renewed in this state on or
after
September 1, 2004.
(4) (5)
This section does not apply to a
health maintenance
organization contract.
Sec. 3406m. (1) An insurer that delivers, issues for delivery,
or
renews in this state an expense-incurred hospital, medical, or
surgical
a health insurance policy or certificate that requires an
insured to designate a participating primary care provider and
provides for annual well-woman examinations and routine obstetrical
and gynecologic services shall permit a female insured to access an
obstetrician-gynecologist for annual well-woman examinations and
routine obstetrical and gynecologic services.
(2) An insurer shall not require prior authorization or
referral for access under subsection (1) to an obstetrician-
gynecologist who is participating with the insurer. An insurer may
require prior authorization or referral for access to a
nonparticipating obstetrician-gynecologist.
(3)
A An insurer shall include
a description of the coverage
provided
by required under this section shall be included by the
insurer
in a communication sent to the
insured or group purchaser
of coverage.
Sec. 3406n. (1) An insurer that delivers, issues for delivery,
or
renews in this state an expense-incurred hospital, medical, or
surgical
a health insurance policy or certificate that requires an
insured to designate a participating primary care provider and
provides for dependent care coverage shall permit a dependent minor
insured to select and access a pediatrician for general pediatric
care services.
(2) An insurer shall not require prior authorization or
referral for access under subsection (1) to a pediatrician who
participates with the insurer. An insurer may require prior
authorization or referral for access to a nonparticipating
pediatrician.
Sec. 3406o. (1) An insurer that delivers, issues for delivery,
or
renews in this state an expense-incurred hospital, medical, or
surgical
a health insurance policy or certificate that provides
coverage for prescription drugs and limits those benefits to drugs
included in a formulary shall do all of the following:
(a) Provide for participation of participating physicians,
dentists, and pharmacists in the development of the formulary.
(b) Disclose to health care providers and upon request to
insureds the nature of the formulary restrictions.
(c) Provide for exceptions from the formulary limitation when
a nonformulary alternative is a medically necessary and appropriate
alternative. This subdivision does not prevent an insurer from
establishing prior authorization requirements or another process
for consideration of coverage or higher cost-sharing for
nonformulary
alternatives. Notice as to whether or not an exception
under
this subdivision has been granted shall be given by the
insurer
within 24 hours after receiving all information necessary
to
determine whether the exception should be granted.
(2) On a request for an expedited review of coverage for
prescription drugs based on exigent circumstances, an insurer shall
make a determination and notify the enrollee or the enrollee's
designee and the prescribing physician, or other prescriber, as
appropriate, of the determination within 24 hours after the insurer
receives the request. For purposes of this subsection, exigent
circumstances exist when an enrollee is suffering from a health
condition that may seriously jeopardize the enrollee's life,
health, or ability to regain maximum function or when an enrollee
is undergoing a current course of treatment using a nonformulary
drug.
(3) If subsection (2) does not apply, an insurer shall make a
determination on coverage for prescription drugs and notify the
enrollee or the enrollee's designee and the prescribing physician,
or other prescriber, as appropriate, of the determination within 72
hours after the insurer receives the request.
Sec.
3406p. (1) An insurer providing an expense-incurred
hospital,
medical, or surgical policy or certificate delivered or
issued
that delivers, issues for delivery,
or renews in this state
and
a health maintenance organization a
health insurance policy
shall establish and provide to insureds, enrollees, and
participating
affiliated providers a program to prevent the onset
of
clinical diabetes. This program for participating affiliated
providers
shall must emphasize best practice guidelines to prevent
the onset of clinical diabetes and to treat diabetes, including,
but not limited to, diet, lifestyle, physical exercise and fitness,
and early diagnosis and treatment.
(2)
An insurer and a health maintenance organization providing
that
provides a program pursuant to under subsection
(1) shall
regularly measure the effectiveness of the program by regularly
surveying
individuals covered by the health
insurance policy. ,
certificate,
or contract. Not later than 2 years after the
effective
date of the amendatory act that added this section, each
insurer
and health maintenance organization providing a program
pursuant
to subsection (1) shall prepare a report containing the
results
of the survey and shall provide a copy of the report to the
department
of community health.
(3)
An expense-incurred hospital, medical, or surgical policy
or
certificate delivered or issued insurer
that delivers, issues
for
delivery, or renews in this state and a health maintenance
organization
contract a health insurance policy
shall include
coverage for the following equipment, supplies, and educational
training for the treatment of diabetes, if determined to be
medically necessary and prescribed by an allopathic or osteopathic
physician:
(a) Blood glucose monitors and blood glucose monitors for the
legally blind.
(b) Test strips for glucose monitors, visual reading and urine
testing strips, lancets, and spring-powered lancet devices.
(c) Syringes.
(d) Insulin pumps and medical supplies required for the use of
an insulin pump.
(e) Diabetes self-management training to ensure that persons
with diabetes are trained as to the proper self-management and
treatment of their diabetic condition.
(4)
An expense-incurred hospital, medical, or surgical policy
or
certificate delivered or issued insurer
that delivers, issues
for
delivery, or renews in this state and a health maintenance
organization
contract a health insurance policy
that provides
outpatient pharmaceutical coverage directly or by rider shall
include the following coverage for the treatment of diabetes, if
determined to be medically necessary:
(a) Insulin, if prescribed by an allopathic or osteopathic
physician.
(b) Nonexperimental medication for controlling blood sugar, if
prescribed by an allopathic or osteopathic physician.
(c) Medications used in the treatment of foot ailments,
infections, and other medical conditions of the foot, ankle, or
nails associated with diabetes, if prescribed by an allopathic,
osteopathic, or podiatric physician.
(5) Coverage under subsection (3) for diabetes self-management
training is subject to all of the following:
(a)
Is The training is limited to completion of a certified
diabetes
education program upon occurrence of if either of the
following applies:
(i) If The
training is considered medically
necessary upon the
diagnosis of diabetes by an allopathic or osteopathic physician who
is
managing the patient's diabetic condition and if the services
are
is needed under a comprehensive plan of care to ensure
therapy
compliance or to provide necessary skills and knowledge.
(ii) If an An allopathic or osteopathic
physician diagnoses
has diagnosed a significant change with long-term implications in
the
patient's symptoms or conditions that necessitates changes in a
the patient's self-management or a significant change in medical
protocol or treatment modalities.
(b)
Shall The training must be provided by a diabetes
outpatient
training program certified to receive medicaid or
medicare
Medicaid or Medicare reimbursement or certified by the
department of community health. Training provided under this
subdivision
shall must be conducted in group settings whenever
practicable.
(6) Coverage under this section is not subject to dollar
limits, deductibles, or copayment provisions that are greater than
those for physical illness generally.
(7) As used in this section, "diabetes" includes all of the
following:
(a) Gestational diabetes.
(b) Insulin-dependent diabetes.
(c) Non-insulin-dependent diabetes.
Sec.
3406q. (1) An expense-incurred hospital, medical, or
surgical
policy or certificate delivered, issued insurer that
delivers,
issues for delivery, or renewed renews in
this state a
health
insurance policy that provides
pharmaceutical coverage and a
health
maintenance organization contract that provides
pharmaceutical
coverage shall provide coverage for
an off-label use
of
a federal food and drug administration United States Food and
Drug Administration approved drug and the reasonable cost of
supplies medically necessary to administer the drug.
(2) Coverage for a drug under subsection (1) applies if all of
the following conditions are met:
(a)
The drug is approved by the federal food and drug
administration.United States Food and Drug Administration.
(b) The drug is prescribed by an allopathic or osteopathic
physician for the treatment of either of the following:
(i) A life-threatening condition so long as if the
drug is
medically
necessary to treat that the
condition and the drug is on
the
plan formulary or accessible through the health plan's
insurer's formulary procedures.
(ii) A chronic and seriously debilitating condition so
long as
if
the drug is medically necessary to
treat that the condition and
the
drug is on the plan formulary or accessible through the health
plan's
insurer's formulary procedures.
(c) The drug has been recognized for treatment for the
condition for which it is prescribed by 1 of the following:
(i) The American medical association Medical Association drug
evaluations.
(ii) The American hospital formulary service Hospital
Formulary Service drug information.
(iii) The United States pharmacopoeia dispensing
information,
volume
1, "drug information for the health care
professional".Pharmacopoeia Dispensing Information, Volume
1, "Drug
Information for the Health Care Professional".
(iv) Two articles from major peer-reviewed medical journals
that present data supporting the proposed off-label use or uses as
generally safe and effective unless there is clear and convincing
contradictory evidence presented in a major peer-reviewed medical
journal.
(3) Upon request, the prescribing allopathic or osteopathic
physician
shall supply to the insurer or health maintenance
organization
documentation supporting compliance
with subsection
(2).
(4) This section does not prohibit the use of a copayment,
deductible,
sanction, or a mechanism for appropriately controlling
the utilization of a drug that is prescribed for a use different
from
the use for which the drug has been approved by the food and
drug
administration. United States
Food and Drug Administration.
This may include prior approval or a drug utilization review
program. Any copayment, deductible, sanction, prior approval, drug
utilization review program, or mechanism described in this
subsection
shall must not be more restrictive than for prescription
coverage generally.
(5) As used in this section:
(a) "Chronic and seriously debilitating" means a disease or
condition that requires ongoing treatment to maintain remission or
prevent deterioration and that causes significant long-term
morbidity.
(b)
"Life-threatening" means a disease or condition where as
to which the likelihood of death is high unless the course of the
disease is interrupted or that has a potentially fatal outcome
where
and as to which the end point of clinical intervention is
survival.
(c) "Off-label" means the use of a drug for clinical
indications other than those stated in the labeling approved by the
federal
food and drug administration.United
States Food and Drug
Administration.
Sec. 3406r. (1) As used in this section, "nurse midwife" means
an individual licensed as a registered professional nurse under
article 15 of the public health code, 1978 PA 368, MCL 333.16101 to
333.18838, who has been issued a specialty certification in the
practice of nurse midwifery by the Michigan board of nursing under
section 17210 of the public health code, 1978 PA 368, MCL
333.17210.
(2)
Effective March 1, 2005, a health maintenance organization
contract
and an expense-incurred hospital, medical, or surgical
policy
or certificate An insurer
that delivers, issues for
delivery, or renews in this state a policy of health insurance that
provides coverage for obstetrical and gynecological services shall
include coverage for obstetrical and gynecological services whether
performed by a physician or a nurse midwife acting within the scope
of his or her license or specialty certification or shall do 1 or
both of the following:
(a) Offer to provide coverage for obstetrical and
gynecological services whether performed by a physician or a nurse
midwife acting within the scope of his or her license or specialty
certification.
(b) Offer to provide coverage for maternity services and
gynecological services rendered during pre- and post-natal care
whether performed by a physician or a nurse midwife acting within
the scope of his or her license or specialty certification.
Sec. 3406s. (1) Except as otherwise provided in this section,
an
expense-incurred hospital, medical, or surgical group or
individual
policy or certificate delivered, issued insurer that
delivers,
issues for delivery, or renewed renews in
this state and
a
health maintenance organization group or individual contract a
health insurance policy shall provide coverage for the diagnosis of
autism spectrum disorders and treatment of autism spectrum
disorders.
An insurer and a health maintenance organization shall
not do any of the following:
(a) Terminate coverage or refuse to deliver, execute, issue,
amend, adjust, or renew coverage solely because an individual is
diagnosed with, or has received treatment for, an autism spectrum
disorder.
(b) Limit the number of visits an insured or enrollee may use
for treatment of autism spectrum disorders covered under this
section.
(c) Deny or limit coverage under this section on the basis
that treatment is educational or habilitative in nature.
(d) Except as otherwise provided in this subdivision, subject
coverage under this section to dollar limits, copays, deductibles,
or coinsurance provisions that do not apply to physical illness
generally.
Coverage An insurer may
limit coverage under this
section
for treatment of autism spectrum disorders may be limited
to
an insured or enrollee through 18 years of age and may be
subject the coverage to a maximum annual benefit as follows:
(i) For a covered insured or enrollee through 6 years of age,
$50,000.00.
(ii) For a covered insured or enrollee from 7 years of age
through 12 years of age, $40,000.00.
(iii) For a covered insured or enrollee from 13 years of age
through 18 years of age, $30,000.00.
(2) This section does not limit benefits that are otherwise
available to an insured or enrollee under a policy, contract, or
certificate.
An insurer or health maintenance organization shall
utilize evidence-based care and managed care cost-containment
practices
pursuant to the insurer's or health maintenance
organization's
procedures so long as that if the care
and those
practices
are consistent with this section. The An insurer may
subject
coverage under this section may be
subject to other general
exclusions and limitations of the policy, contract, or certificate,
including, but not limited to, coordination of benefits,
participating
affiliated provider requirements, restrictions on
services provided by family or household members, utilization
review of health care services including review of medical
necessity, case management, and other managed care provisions.
(3) If an insured or enrollee is receiving treatment for an
autism
spectrum disorder, an insurer or health maintenance
organization
may, as a condition to providing
the coverage under
this section, do all of the following:
(a)
Require a review of that the
treatment consistent with
current protocols and may require a treatment plan. If requested by
the
insurer, or health maintenance organization, the cost
of
treatment
review shall must be borne by the insurer. or
health
maintenance
organization.
(b) Request the results of the autism diagnostic observation
schedule that has been used in the diagnosis of an autism spectrum
disorder
for that the insured or enrollee.
(c) Request that the autism diagnostic observation schedule be
performed
on that the insured or enrollee not more frequently than
once every 3 years.
(d) Request that an annual development evaluation be conducted
and
the results of that the annual development evaluation be
submitted
to the insurer. or health maintenance organization.
(4)
Beginning January 1, 2014, a A
qualified health plan
offered through an American health benefit exchange established in
this state pursuant to the federal act is not required to provide
coverage under this section to the extent that it exceeds coverage
that is included in the essential health benefits as required
pursuant to the federal act. As used in this subsection, "federal
act"
means the federal patient protection and affordable care act,
Public
Law 111-148, as amended by the federal health care and
education reconciliation act of 2010, Public Law 111-152, and any
regulations promulgated under those acts.
(5) This section does not apply to a short-term or 1-time
limited duration policy or certificate of no longer than 6 months
as described in section 2213b.
(6) This section does not require the coverage of prescription
drugs and related services unless the insured or enrollee is
covered by a prescription drug plan. This section does not require
an
insurer or health maintenance organization to provide coverage
for autism spectrum disorders to an insured or enrollee under more
than
1 of its health insurance policies.
, certificates, or
contracts.
If an insured or enrollee has more
than 1 health
insurance
policy , certificate, or
contract that covers autism
spectrum disorders, the benefits provided are subject to the limits
of this section when coordinating benefits.
(7) As used in this section:
(a) "Applied behavior analysis" means the design,
implementation, and evaluation of environmental modifications,
using behavioral stimuli and consequences, to produce significant
improvement in human behavior, including the use of direct
observation, measurement, and functional analysis of the
relationship between environment and behavior.
(b) "Autism diagnostic observation schedule" means the
protocol
available through western psychological services Western
Psychological Services for diagnosing and assessing autism spectrum
disorders or any other standardized diagnostic measure for autism
spectrum
disorders that is approved by the commissioner, director,
if
the commissioner director determines that the diagnostic measure
is recognized by the health care industry and is an evidence-based
diagnostic tool.
(c) "Autism spectrum disorders" means any of the following
pervasive
developmental disorders as defined by the diagnostic and
statistical
manual:Diagnostic and
Statistical Manual:
(i) Autistic disorder.
(ii) Asperger's disorder.
(iii) Pervasive developmental disorder not otherwise
specified.
(d) "Behavioral health treatment" means evidence-based
counseling and treatment programs, including applied behavior
analysis, that meet both of the following requirements:
(i) Are necessary to develop, maintain, or restore, to the
maximum extent practicable, the functioning of an individual.
(ii) Are provided or supervised by a board certified behavior
analyst
or a licensed psychologist so long as if the services
performed are commensurate with the psychologist's formal
university training and supervised experience.
(e) "Diagnosis of autism spectrum disorders" means
assessments, evaluations, or tests, including the autism diagnostic
observation schedule, performed by a licensed physician or a
licensed psychologist to diagnose whether an individual has 1 of
the autism spectrum disorders.
(f)
"Diagnostic and statistical manual" or "DSM" Statistical
Manual"
means the diagnostic and statistical
manual of mental
disorders
Diagnostic and Statistical
Manual of Mental Disorders
published
by the American psychiatric association Psychiatric
Association
or other another manual
that contains common language
and standard criteria for the classification of mental disorders
and
that is approved by the commissioner, director, if the
commissioner
director determines that the manual is recognized by
the health care industry and the classification of mental disorders
is at least as comprehensive as the manual published by the
American
psychiatric association Psychiatric
Association on the
effective
date of this section.April
18, 2012.
(g) "Pharmacy care" means medications prescribed by a licensed
physician and related services performed by a licensed pharmacist
and any health-related services considered medically necessary to
determine the need or effectiveness of the medications.
(h) "Psychiatric care" means evidence-based direct or
consultative services provided by a psychiatrist licensed in the
state in which the psychiatrist practices.
(i) "Psychological care" means evidence-based direct or
consultative services provided by a psychologist licensed in the
state in which the psychologist practices.
(j) "Therapeutic care" means evidence-based services provided
by a licensed or certified speech therapist, occupational
therapist, physical therapist, or social worker.
(k) "Treatment of autism spectrum disorders" means evidence-
based treatment that includes the following care prescribed or
ordered for an individual diagnosed with 1 of the autism spectrum
disorders by a licensed physician or a licensed psychologist who
determines the care to be medically necessary:
(i) Behavioral health treatment.
(ii) Pharmacy care.
(iii) Psychiatric care.
(iv) Psychological care.
(v) Therapeutic care.
(l) "Treatment plan" means a written, comprehensive, and
individualized intervention plan that incorporates specific
treatment goals and objectives and that is developed by a board
certified or licensed provider who has the appropriate credentials
and who is operating within his or her scope of practice, when the
treatment of an autism spectrum disorder is first prescribed or
ordered by a licensed physician or licensed psychologist as
described in subdivision (k).
Sec.
3407. There Except as
otherwise provided in this act, an
insurer
shall be a provision as follows:include the following
provision in a disability insurance policy:
ENTIRE CONTRACT; CHANGES: This policy, including the
applicable riders and endorsements; the application for coverage if
specified by the insurer; the identification card if specified by
the insurer; and the attached papers, if any, constitutes the
entire
contract of insurance. No change in this policy shall be is
valid until approved by an executive officer of the insurer and
unless
such the approval be is endorsed hereon on this policy or
attached
hereto. No agent has to
this policy. An insurance producer
does not have authority to change this policy or to waive any of
its provisions.
Sec.
3407b. (1) An expense-incurred hospital, medical, or
surgical
insurer that delivers, issues
for delivery, or renews in
this
state a health insurance policy or
certificate delivered,
issued
for delivery, or renewed in this state shall not require an
insured or his or her dependent or an asymptomatic applicant for
insurance or his or her asymptomatic dependent to do either of the
following:
(a) Undergo genetic testing before issuing, renewing, or
continuing
the policy or certificate in this state.
(b) Disclose whether genetic testing has been conducted or the
results of genetic testing or genetic information.
(2)
This section does not prohibit an insurer from requiring
an
applicant for an expense-incurred hospital, medical, or surgical
policy
or certificate to answer questions concerning family
history.
(2) (3)
As used in this section:
(a) "Clinical purposes" includes all of the following:
(i) Predicted Predicting risk of diseases.
(ii) Identifying carriers for single-gene disorders.
(iii) Establishing prenatal and clinical diagnosis or
prognosis.
(iv) Prenatal, newborn, and other carrier screening, as well
as testing in high-risk families.
(v) Tests Testing for metabolites if
undertaken with high
probability that an excess or deficiency of the metabolite
indicates or suggests the presence of heritable mutations in single
genes.
(vi) Other tests testing if their the intended
purpose is
diagnosis of a presymptomatic genetic condition.
(b) "Genetic information" means information about a gene, gene
product, or inherited characteristic derived from a genetic test.
(c) "Genetic test" means the analysis of human DNA, RNA,
chromosomes, and those proteins and metabolites used to detect
heritable or somatic disease-related genotypes or karyotypes for
clinical purposes. A genetic test must be generally accepted in the
scientific and medical communities as being specifically
determinative for the presence, absence, or mutation of a gene or
chromosome
in order to qualify under this definition. Genetic test
does not include a routine physical examination or a routine
analysis, including, but not limited to, a chemical analysis, of
body fluids, unless conducted specifically to determine the
presence, absence, or mutation of a gene or chromosome.
Sec.
3408. (1) There An
insurer shall be include in a
disability insurance policy, other than a health insurance policy,
a
provision as follows:that
consists of both of the following:
(a) One of the following, as applicable:
(i) TIME LIMIT ON CERTAIN DEFENSES: (a) After 3 years from the
date
of issue of this policy, no misstatements, the insurer will
not
use a misstatement, except a fraudulent
misstatements,
misstatement,
made by the applicant in the
application for such the
policy
shall be used to void the policy or to deny a claim for loss
incurred
or disability, (as as
defined in the policy) commencing
policy,
beginning after the expiration of such
the 3-year period.
(The
foregoing This policy provisions shall provision does not
be
so construed as to affect any a legal
requirement for avoidance
of
a policy or denial of a claim during such the initial 3-year
period,
nor to and does not limit the application of sections 3432,
(change
of occupation), 3434, (misstatement
of age), 3436, (other
insurance—same
insurer), 3438, (insurance
with other
insurers—provision
of service or expense incurred basis), and 3440
(insurance
with other insurers) in the event of if a misstatement
with
respect to age or occupation or other insurance.)insurance is
made.
(ii) (A
Instead of the provision
required under subparagraph
(i), for a policy which that the
insured has the right to continue
in
force subject to its terms by the timely payment of premium (1)
until
at least age 50 or, (2) in the case of for a policy issued
after
age 44, for at least 5 years from after its date of issue, an
insurer
may contain in lieu of the foregoing
the following
provision
(from which the clause in parentheses may be omitted at
the
insurer's option) include the
following in the policy, under
the
caption "INCONTESTABLE":)"INCONTESTABLE":
After this policy has been in force for a period of 3 years
during the lifetime of the insured (excluding any period during
which
the insured is disabled), it shall become becomes
incontestable as to the statements contained in the application.
(b)
No A claim for a
loss incurred or disability, (as
as
defined
in the policy, ) commencing beginning after 3 years from
the
date of issue of this policy shall will not be reduced or
denied on the ground that a disease or physical condition not
excluded from coverage by name or specific description effective on
the
date of loss had existed prior to before the effective date of
coverage of this policy.
(2) (For
For the purpose of permitting insurers to use a
uniform
policy in several states, the insurer is permitted to may
print
in the policy form in required the
provisions (a) required
under
subsection (1)(a) and (b) above the
term of "3 years".
Nevertheless,
the provisions Notwithstanding
any provision of the
contract
and text of the statute or
law to the contrary,
notwithstanding,
the time limits for said the defenses
under any
contract
described in this section and
included in a disability
insurance policy, not including a health insurance policy, that is
delivered
or issued for delivery to any person in this state shall
must
not exceed 2 years.)years.
Sec.
3409. (1) Except as otherwise provided in subsection (2),
this section, an insurer that delivers, issues for delivery, or
renews in this state a disability insurance policy, other than a
policy
that provides group and or blanket
insurance, delivered or
issued
for delivery to a person in this state shall contain include
the following notice, in substance printed or stamped on the front
page and made a permanent part of the policy:
Cancellation during first 10 days: During a period of 10 days
after
the date the policyholder receives the this policy, the
policyholder may cancel the policy and receive from the insurer a
prompt refund of any premium paid for the policy, including a
policy fee or other charge, by mailing or otherwise surrendering
the policy to the insurer together with a written request for
cancellation.
If a policyholder or purchaser pursuant to such this
notice returns the policy or contract to the company or association
at its home or branch office or to the agent through whom it was
purchased,
it shall be is void from the beginning and the parties
shall
be are in the same position as if no policy or contract had
been issued.
Cancellation
after 10 days: A policyholder may cancel the this
policy
after the first 10 days following after receipt of the
policy by giving written notice to the insurer effective upon
receipt
or on a later date as may be specified in the notice. In
the
event of cancellation, If
this policy is canceled under this
paragraph,
the insurer shall will promptly
refund to the
policyholder the excess of paid premium above the pro rata premium
for the expired time. Cancellation under this paragraph is without
prejudice
to any claim originating prior to before the effective
date of cancellation.
(2)
A policy of An insurer
that sells a disability insurance
which
is sold policy through solicitation to a person who is
eligible
for medicare Medicare shall contain include the following
notice, in substance printed or stamped on the front page and made
a permanent part of the policy:
Cancellation during the first 30 days: During a period of 30
days
after the date the policyholder receives the this policy,
the
policyholder may cancel the policy and receive from the insurer a
prompt refund of any premium paid for the policy, including a
policy fee or other charge, by mailing or otherwise surrendering
the policy to the insurer together with a written request for
cancellation.
If a policyholder or purchaser pursuant to such this
notice returns the policy or contract to the company or association
at its home or branch office or to the agent through whom it was
purchased,
it shall be is void from the beginning and the parties
shall
be are in the same position as if no policy or contract had
been issued.
Cancellation
after 30 days: A policyholder may cancel the this
policy
after the first 30 days following after receipt of the
policy by giving written notice to the insurer effective upon
receipt
or on a later date as may be specified in the notice. In
the
event of cancellation, If
this policy is canceled under this
paragraph,
the insurer shall will promptly
refund to the
policyholder the excess of paid premium above the pro rata premium
for the expired time. Cancellation under this paragraph is without
prejudice
to any claim originating prior to before the effective
date of cancellation.
(3) If a policyholder cancels a disability insurance policy
during the first 30 days after receipt of the policy, the
policyholder is responsible for claims paid by the insurer that
were incurred before the effective date of cancellation.
Sec.
3411. (1) There Subject
to subsection (2), an insurer
shall
be a include the following
provision as follows:in a
disability insurance policy other than a health insurance policy:
REINSTATEMENT:
If any renewal premium be is not
paid within
the time granted the insured for payment, a subsequent acceptance
of
premium by the insurer or by any an agent duly authorized by
the
insurer
to accept such the premium, without requiring in connection
therewith
with the acceptance of the premium
an application for
reinstatement,
shall reinstate is a
reinstatement of the policy:
Provided,
however, That policy.
However, if the insurer or such its
agent requires an application for reinstatement and issues a
conditional
receipt for the premium tendered, the policy will be is
reinstated
upon approval of such the application by the insurer or,
lacking
such approval, upon if not
approved by the insurer, on the
forty-fifth
day following after the date of such the conditional
receipt unless the insurer has previously notified the insured in
writing
of its disapproval of such the
application. The Under the
reinstated
policy, shall the insurer will cover only
loss resulting
from
such accidental injury as may be that is sustained after the
date
of reinstatement and loss due to such sickness as may begin
that
begins more than 10 days after such that date.
In all other
respects, the
insured and insurer shall have the same rights
thereunder
under the policy as they had under the policy
immediately before the due date of the defaulted premium, subject
to
any provisions endorsed hereon on
the policy or attached hereto
to
the policy in connection with the
reinstatement. Any The insurer
will apply any premium accepted in connection with a reinstatement
shall
be applied to a period for which
premium has not been
previously
paid, but not to any period more than 60 days prior to
before the date of reinstatement.
(2) (The
An insurer may omit the last sentence of the above
provision
may be omitted required
under subsection (1) from any a
policy
which that the insured has the right to continue in force
subject
to its terms by the timely payment of premium (1) until at
least
age 50 or, (2) in the case of for
a policy issued after age
44,
for at least 5 years from after
its date of issue.)issue.
Sec.
3412. (1) There Except
as otherwise provided in
subsection
(2), an insurer shall be include in a disability
insurance policy, other than a health insurance policy, a provision
as follows:
NOTICE OF CLAIM: Written notice of claim must be given to the
insurer
within 20 days after the occurrence or commencement of any
a
loss covered by the policy, or as soon thereafter
after the loss
as is reasonably possible. Notice given by or on behalf of the
insured or the beneficiary to the insurer at .....................
(insert
the location of such the office as the insurer may
designate
designates for the this purpose), or to any
authorized
agent of the insurer, with information sufficient to identify the
insured,
shall be deemed is
considered notice to the insurer.
(2) (In
For a policy providing that provides a loss-of-time
benefit
which may be payable for at least 2 years, an insurer may
at its option insert the following between the first and second
sentences
of the above provision
required under subsection (1):
Subject to the qualifications set forth below, if the insured
suffers loss of time on account of disability for which indemnity
may
be is payable for at least 2 years, he shall, the insured will,
at least once in every 6 months after having given notice of claim,
give
to the insurer notice of continuance of said the disability,
except
in the event of legal incapacity. unless
the insured is
legally incapacitated. The period of 6 months following any filing
of proof by the insured or any payment by the insurer on account of
such
the claim or any denial of liability in whole or in part
by
the
insurer shall be is excluded in applying this provision. Delay
in
the giving of such the
notice shall required under this
provision does not impair the insured's right to any indemnity
which
that would otherwise have accrued during the period of
6
months
preceding the date on which such the notice is actually
given.)given.
Sec.
3413. There An insurer shall be include in a disability
insurance policy, other than a health insurance policy, a provision
as follows:
CLAIM FORMS: The insurer, upon receipt of a notice of claim,
will
furnish to the claimant such the
forms as that are
usually
furnished
by it for filing proofs of loss. If such the forms
are
not
furnished within 15 days after the giving of such the notice,
the
claimant shall be deemed is
considered to have complied with
the requirements of this policy as to proof of loss upon
submitting, within the time fixed in the policy for filing proofs
of loss, written proof covering the occurrence, the character, and
the extent of the loss for which claim is made.
Sec.
3414. There An insurer shall be include in a disability
insurance policy, other than a health insurance policy, a provision
as follows:
PROOFS OF LOSS: Written proof of loss must be furnished to the
insurer
at its said designated office. in case of Proof of loss for
a claim for loss for which this policy provides any periodic
payment that is contingent upon continuing loss must be furnished
within 90 days after the termination of the period for which the
insurer
is liable. and in case of Proof of loss for a claim for any
other
loss must be furnished within 90 days after the date of such
the
loss. Failure to furnish such the proof
within the time
required
shall under this provision
does not invalidate nor or
reduce
any the claim if it was not reasonably possible to give
proof
within such the time , provided such required if the proof is
furnished
as soon as reasonably possible and, in no event, except
in
the absence of legal capacity, unless
the claimant is legally
incapacitated,
not later than 1 year from after the
time proof is
otherwise required.
Sec.
3416. There An insurer shall be include in a disability
insurance policy, other than a health insurance policy, a provision
as follows:
TIME OF PAYMENT OF CLAIMS: Indemnities payable under this
policy
for any a loss other than loss for which this policy
provides
any a periodic payment will be paid immediately upon
receipt
of due written proof of such the
loss. Subject to due
written proof of loss, all accrued indemnities for loss for which
this policy provides periodic payment will be paid
.......................
(insert period for payment which that must
not be less frequently than monthly) and any balance remaining
unpaid
upon on the termination of liability will be paid
immediately upon receipt of due written proof.
Sec.
3418. (1) There Except
as otherwise provided in
subsection
(2), an insurer shall be include in a disability
insurance policy, other than a health insurance policy, a provision
as follows:
PAYMENT OF CLAIMS: Indemnity for loss of life will be payable
in accordance with the beneficiary designation and the provisions
respecting
such the payment, which may be prescribed herein in this
policy,
and effective at the time of payment.
If no such a
designation
or provision is then effective, such not in effect, the
indemnity
shall be is payable to the estate of the insured. Any
other
Other accrued indemnities unpaid at the insured's death
may,
at
the option of the insurer, be paid either to such the
beneficiary
or to such the estate. All other indemnities will be
are payable to the insured.
(2) (The
One or more of the following provisions , or either
of
them, may be included with the foregoing
provision required
under subsection (1) at the option of the insurer:
(a) If
any indemnity of under
this policy shall be is payable
to the estate of the insured, or to an insured or beneficiary who
is a minor or otherwise not competent to give a valid release, the
insurer
may pay such the indemnity, up to an amount that does not
exceeding
exceed $........ (insert an amount which shall that does
not exceed $1,000.00), to any relative by blood or connection by
marriage
of the insured or beneficiary who is deemed determined by
the
insurer to be equitably entitled thereto. Any payment to the
indemnity. Payment made by the insurer in good faith pursuant to
this
provision shall fully discharge discharges the insurer to
the
extent
of such the payment.
(b) Subject to any written direction of the insured in the
application or otherwise, all or a portion of any indemnities
provided
by this policy on account of hospital, nursing, medical,
or
surgical health care services may, at the insurer's option and
unless the insured requests otherwise in writing not later than the
time
of filing proofs of such the
loss, be paid directly to the
hospital
or person rendering such services.)the health care
services.
Sec.
3420. There An insurer shall be include in a disability
insurance policy, other than a health insurance policy, a provision
as follows:
PHYSICAL EXAMINATIONS AND AUTOPSY: The insurer at its own
expense
shall have has the right and must be given the opportunity
to
examine the person of the insured when at reasonable times and
as
often as frequently as it may reasonably require required during
the
pendency of a claim hereunder under
this policy and to make an
autopsy
in case of death where it is if
not forbidden by law.
Sec.
3422. There An insurer shall be include in a disability
insurance policy, other than a health insurance policy, a provision
as follows:
LEGAL
ACTIONS: No An insured must not bring an action at law
or
in equity shall be brought to recover on this policy prior to
before the expiration of 60 days after written proof of loss has
been furnished in accordance with the requirements of this policy.
No
such An insured must not
bring an action shall be brought at law
or in equity after the expiration of 3 years after the time written
proof of loss is required to be furnished.
Sec.
3424. (1) There Except
as otherwise provided in
subsection
(2), an insurer shall be include in a disability
insurance policy, other than a health insurance policy, a provision
as follows:
CHANGE OF BENEFICIARY: Unless the insured makes an irrevocable
designation
of beneficiary, the insured has
the right to change of
the
beneficiary is reserved to the
insured and the consent under
this
policy. Consent of the a beneficiary
or beneficiaries shall is
not
be requisite required to surrender or this policy, for the
assignment
of this the policy, or to any change of a beneficiary,
or
beneficiaries, or to make any
other changes in this the policy.
(2) (The
The first clause of this the provision required under
subsection (1), relating to the irrevocable designation of
beneficiary,
may be omitted at the insurer's option.)option.
Sec.
3425. (1) Each Except as
otherwise provided in this
subsection,
an insurer offering that delivers, issues for delivery,
or
renews in this state a health insurance
policies in this state
policy shall provide coverage for intermediate and outpatient care
for
substance abuse, upon issuance or renewal, in all contracts
for,
group and individual hospital, medical, surgical expense-
incurred
health insurance policies other than use disorder. This
section does not apply to limited classification policies.
(2)
In the case of group health insurance policies, if the
premium
for a group health insurance policy would be increased by
3%
or more because of the provision of the coverage required under
subsection
(1), the master policyholder shall have the option to
decline
the coverage required to be provided under subsection (1).
In
the case of individual health insurance policies, if the total
premium
for all individual health insurance policies of an insurer
would
be increased by 3% or more because of the provision of the
coverage
required under subsection (1) in all of those policies,
the
named insured of each such policy shall have the option to
decline
the coverage required to be provided under subsection (1).
(2) (3)
Charges, terms, and conditions for
the coverage
required
to be provided under subsection (1) shall must not be less
favorable than the maximum prescribed for any other comparable
service.
(3) (4)
The insurer shall not reduce the coverage
required to
be
provided under subsection (1) shall not be reduced by terms or
conditions
which that apply to other items of coverage in a health
insurance
policy, group or individual. This subsection shall does
not
be construed to prohibit an
insurer from providing in a health
insurance
policies that provide for policy
deductibles and
copayment provisions for coverage for intermediate and outpatient
care
for substance abuse.use
disorder.
(5)
The coverage required to be provided under subsection (1)
shall,
at a minimum, provide for up to $1,500.00 in benefits for
intermediate
and outpatient care for substance abuse per individual
per
year. This minimum shall be adjusted annually by March 31 each
year
in accordance with the annual average percentage increase or
decrease
in the United States consumer price index for the 12-month
period
ending the preceding December 31.
(4) (6)
As used in this section:
(a)
"Health insurance policy" means a hospital, medical, or
surgical
expense-incurred policy.
(a) (b)
"Intermediate care" means
the use, in a full 24-hour
residential therapy setting, or in a partial, less than 24-hour,
residential therapy setting, of any or all of the following
therapeutic techniques, as identified in a treatment plan for
individuals
physiologically or psychologically dependent upon on or
abusing alcohol or drugs:
(i) Chemotherapy.
(ii) Counseling.
(iii) Detoxification services.
(iv) Other ancillary services, such as medical testing,
diagnostic evaluation, and referral to other services identified in
a
the treatment plan.
(b) (c)
"Limited classification
policy" means an accident only
policy, a limited accident policy, a travel accident policy, or a
specified disease policy.
(c) (d)
"Outpatient care" means
the use, on both a scheduled
and a nonscheduled basis, of any or all of the following
therapeutic techniques, as identified in a treatment plan for
individuals
physiologically or psychologically dependent upon on or
abusing alcohol or drugs:
(i) Chemotherapy.
(ii) Counseling.
(iii) Detoxification services.
(iv) Other ancillary services, such as medical testing,
diagnostic evaluation, and referral to other services identified in
a
the treatment plan.
(d) (e)
"Substance abuse" use disorder" means that term as
defined
in section 6107 of Act No. 368 of the Public Acts of 1978,
being
section 333.6107 of the Michigan Compiled Laws.100d of the
mental health code, 1974 PA 258, MCL 330.1100d.
(7)
This section shall take effect January 1, 1982.
Sec.
3426. (1) Each An insurer providing a group expense-
incurred
hospital, medical, or surgical certificate delivered,
issued
for delivery, or renewed in this state and each health
maintenance
organization that delivers,
issues for delivery, or
renews in this state a group health insurance policy may offer
group
wellness coverage. Wellness coverage An insurer may provide
for an appropriate rebate or reduction in premiums or for reduced
copayments, coinsurance, or deductibles, or a combination of these
incentives, for participation in any health behavior wellness,
maintenance, or improvement program offered by the employer. The
employer shall provide evidence of demonstrative maintenance or
improvement of the insureds' or enrollees' health behaviors as
determined by assessments of agreed-upon health status indicators
between
the employer and the insurer. or health maintenance
organization.
Any rebate of premium provided by
the insurer or
health
maintenance organization is
presumed to be appropriate
unless
credible data demonstrate otherwise, but shall must not
exceed 50% of paid premiums for tobacco cessation programs or 30%
of paid premiums for other wellness programs, unless otherwise
approved
by the commissioner. Each director.
An insurer and each
health
maintenance organization shall make
available to employers
all
wellness coverage plans that the insurer or health maintenance
organization
markets to employers in this state.
(2)
Each An insurer providing that delivers, issues for
delivery,
or renews in this state an individual
or family expense-
incurred
hospital, medical, or surgical policy delivered, issued
for
delivery, or renewed in this state and each health maintenance
organization
health insurance policy may offer individual and
family
wellness coverage. Wellness coverage An insurer may provide
for an appropriate rebate or reduction in premiums or for reduced
copayments, coinsurance, or deductibles, or a combination of these
incentives, for participation in any health behavior wellness,
maintenance,
or improvement program approved by the insurer. or
health
maintenance organization. The
insured or enrollee shall
provide evidence of demonstrative maintenance or improvement of the
individual's or family's health behaviors as determined by
assessments of agreed-upon health status indicators between the
insured
or enrollee and the insurer. or health maintenance
organization.
Any rebate of premium provided by
the insurer or
health
maintenance organization is
presumed to be appropriate
unless
credible data demonstrate otherwise, but shall must not
exceed
30% 50% of paid premiums, unless otherwise approved by the
commissioner.
Each director. An insurer and each health maintenance
organization
shall make available to individuals
and families all
wellness
coverage plans that the insurer or health maintenance
organization
markets to individuals and families
in this state.
(3)
An insurer and a health maintenance organization are is
not required to continue any health behavior wellness, maintenance,
or improvement program or to continue any incentive associated with
a health behavior wellness, maintenance, or improvement program.
(4) A health behavior wellness, maintenance, or improvement
program under this section may include other requirements in
addition to those that are specific to health behavior wellness,
maintenance, or improvement, if the program, taken as a whole,
meets the intent of this section.
Sec.
3428. Beginning January 1, 2014, an An insurer that
delivers, issues for delivery, or renews in this state a health
insurance policy shall establish and maintain a provider network
that, at a minimum, satisfies any network adequacy requirements
imposed
by the commissioner pursuant to director
under federal law.
Sec.
3432. There An insurer may be include in a disability
insurance policy, other than a health insurance policy, a provision
as follows:
CHANGE
OF OCCUPATION: If the insured be is injured
or contract
sickness
contracts an illness after having changed changing his
or
her
occupation to one 1 classified
by the insurer as more hazardous
than
that the occupation stated in this policy or while doing for
compensation
anything pertaining to any an
occupation so classified
as
more hazardous, the insurer will pay
only such the portion of
the
indemnities provided in this policy as that the premium paid
would have purchased at the rates and within the limits fixed by
the
insurer for such the more hazardous occupation. If the insured
changes
his or her occupation to one 1 classified
by the insurer as
less hazardous than that stated in this policy, the insurer, upon
receipt
of proof of such the change of occupation, will reduce the
premium rate accordingly, and will return the excess pro rata
unearned premium from the date of change of occupation or from the
policy
anniversary date immediately preceding receipt of such the
proof, whichever is the more recent. In applying this provision,
the
classification of occupational risk and the premium rates shall
be
such as have been must be
those that were last filed by the
insurer
prior to before the occurrence of the loss for which the
insurer
is liable or prior to before
the date of proof of change in
the
occupation with the state official having
supervision of that
supervises insurance in the state where the insured resided at the
time
this policy was issued. ; but However,
if such that filing
was
not
required , then in
that state, the classification of
occupational
risk and the premium rates shall must be those last
made
effective by the insurer in such that state prior to before
the
occurrence of the loss or prior to before the date of proof of
change in the occupation.
Sec.
3438. (1) There An
insurer may be include in an
individual disability insurance policy a provision as follows:
INSURANCE
WITH OTHER INSURERS: If there be this insurer has
not been given written notice before the occurrence or commencement
of loss that the insured under this policy has other valid
coverage,
not with this insurer, providing and that other valid
coverage provides benefits for the same loss on a provision of
service
basis or on an expense incurred basis, and of which this
insurer
has not been given written notice prior to the occurrence
or
commencement of loss, the only
liability under any expense
incurred
coverage of this policy shall be is for such the
proportion
of the loss as the amount which that
would otherwise
have
been payable hereunder under
this policy plus the total of the
like
amounts under all such other valid coverages for the same loss
of which this insurer had notice bears to the total like amounts
under
all valid coverages for such the
loss, and for the return of
such
the portion of the premiums premium paid
as shall exceed that
exceeds the pro rata portion for the amount so determined. For the
purpose of applying this provision when other coverage is on a
provision
of service basis, the term "like amount" of such means
with
respect to the other coverage shall
be taken as the amount
which
that the services rendered would have cost in the absence
of
such
the coverage.
(2) (If
If the foregoing policy provision described in
subsection
(1) is included in a an individual policy which of
disability
insurance that also contains the policy
provision set
out
described in section 3440, there the insurer shall be added add
to
the caption of the foregoing policy
provision the phrase
"—EXPENSE INCURRED BENEFITS". The insurer may, at its option,
include in this provision a definition of "other valid coverage",
approved
as to form by the commissioner, director,
which definition
shall
must be limited in subject matter to coverage provided by
organizations subject to regulation by insurance law or by
insurance authorities of this or any other state of the United
States
or any province of Canada, and to
coverage provided by
hospital or medical service organizations, and to any other
coverage the inclusion of which may be approved by the
commissioner.
director. In the absence of such a definition, such
the
term shall must not
include group insurance, automobile medical
payments insurance, or coverage provided by hospital or medical
service
organizations, or by union welfare plans, or by employer
or
employee benefit organizations.
(3)
For the purpose of applying the foregoing
policy provision
with
respect under this section to any insured, any amount of
benefit
provided for such the insured pursuant to any under a
compulsory
benefit statute, (including any workmen's including a
worker's
disability compensation or employer's
liability statute)
statute,
whether provided by a governmental
agency or otherwise
shall
other entity, must in all cases be deemed considered to be
"other
other valid coverage" coverage of
which the insurer has had
notice.
In applying the foregoing policy provision no under this
section, an insurer shall not include third party liability
coverage
shall be included as "other other valid coverage".)
coverage.
Sec.
3440. (1) There An
insurer may be include in an
individual disability insurance policy a provision as follows:
INSURANCE
WITH OTHER INSURERS: If there be this insurer has
not been given written notice before the occurrence or commencement
of loss that the insured under this policy has other valid
coverage,
not with this insurer, providing and that other valid
coverage provides benefits for the same loss on other than an
expense
incurred basis, and of which this insurer has not been
given
written notice prior to the occurrence or commencement of
loss,
the only liability for such the benefits
under this policy
shall
be is for such the proportion of the
indemnities otherwise
provided
hereunder under this
policy for such the loss
as the like
indemnities of which the insurer had notice, including the
indemnities under this policy, bear to the total amount of all like
indemnities
for such the loss, and for the return of such the
portion
of the premium paid as shall exceed that exceeds the pro
rata
portion for the indemnities thus determined under this
provision.
(2) If the foregoing policy provision described in subsection
(1)
is included in a an individual policy which of
disability
insurance
that also contains the policy provision
set out described
in
section 3438, there the insurer shall be
added add to the
caption
of the foregoing policy provision the phrase "—OTHER
BENEFITS". The insurer may, at its option, include in this
provision a definition of "other valid coverage", approved as to
form
by the commissioner, director,
which definition shall must be
limited in subject matter to coverage provided by organizations
subject to regulation by insurance law or by insurance authorities
of this or any other state of the United States or any province of
Canada,
and to any other coverage the inclusion of which may be is
approved
by the commissioner. director.
In the absence of such a
definition, such
the term shall must not include group
insurance ,
or benefits provided by union welfare plans or by employer or
employee benefit organizations. For the purpose of applying the
foregoing
policy provision with respect to
any insured, any amount
of
benefit provided for such the
insured pursuant to under any
compulsory
benefit statute, including any worker's disability
compensation or employer's liability statute, whether provided by a
governmental
agency or otherwise shall other
entity, must in all
cases
be deemed considered to be "other valid coverage" of which
the insurer has had notice, unless the policy contains provisions
for the reduction of benefits otherwise payable under the policy by
the amount of income from other sources that the insured or the
insured's
dependents are qualified to receive due to because of the
insured's age or disability from worker's disability compensation
or federal social security, if at the time the policy was issued,
the
premium had been appropriately reduced to reflect such the
anticipated
reduction in benefits. In applying the foregoing policy
provision, no
an insurer shall not include third party liability
coverage
shall be included as "other other valid
coverage".coverage.
Sec.
3452. (1) There An
insurer may be include in a disability
insurance policy a provision as follows:
ILLEGAL
OCCUPATION OR ILLEGAL ACTIVITY: The insurer shall is
not
be liable for any loss to which a contributing cause was the
insured's commission of or attempt to commit a felony or to which a
contributing cause was the insured's being engaged in an illegal
occupation or illegal activity.
(2) As used in this section, "illegal activity" includes, but
is not limited to, any of the following:
(a) Operating a vehicle while intoxicated in violation of
section 625 of the Michigan vehicle code, 1949 PA 300, MCL 257.625,
or similar law in a jurisdiction outside of this state.
(b) Operating a methamphetamine laboratory. As used in this
subdivision, "methamphetamine laboratory" means that term as
defined in section 1 of 2006 PA 255, MCL 333.26371.
Sec.
3472. (1) Beginning January 1, 2014, during During an
applicable open enrollment period, an insurer that offers,
delivers, issues for delivery, or renews in this state a health
insurance policy shall not deny or condition the issuance or
effectiveness
of a the policy and shall not discriminate in the
pricing
of a the policy on the basis of health status, claims
experience, receipt of health care, or medical condition.
(2)
Subject to prior approval of the commissioner, director,
an insurer shall establish reasonable open enrollment periods for
all
disability health
insurance policies offered, delivered,
issued
for
delivery, or renewed in this state. on or after January 1,
2014.
(3)
The commissioner director shall establish minimum
standards for the frequency and duration of open enrollment periods
established
under subsection (2). The commissioner director shall
uniformly apply the minimum standards for the frequency and
duration of open enrollment periods established under this
subsection to all insurers.
(4) Subject to approval by the director, an insurer may deny
health insurance coverage in the group or individual market if the
insurer does not have the network capacity or financial reserves
necessary to offer additional coverage. An insurer described in
this subsection shall act uniformly with regard to all employers or
individuals in the group or individual market. An insurer described
in this subsection shall act without regard to the claims
experience of an individual or employer and its employees and the
employee's dependents and without regard to any health-status-
related factor relating to the individual or employer and its
employees and the employee's dependents.
(5) Subject to approval by the director, an insurer that
denies health insurance coverage to an employer or individual under
subsection (4) shall not offer coverage in the group or individual
market, as applicable, before the later of the one hundred eighty-
first day after the date the insurer denies the coverage or the
date the insurer demonstrates to the director that the insurer has
sufficient network capacity or financial reserves, as applicable,
to underwrite additional coverage.
(6) Subject to approval by the director, subsection (4) does
not limit the insurer's ability to renew coverage already in force
or relieve the insurer of the responsibility to renew the coverage.
(7) The director may provide for the application of subsection
(4) on a service-area-specific basis for health maintenance
organizations.
Sec.
3474. (1) No Except
as otherwise provided in section
2236(8)(d), an insurer shall not deliver, issue for delivery, or
renew
in this state a disability insurance policy, of
insurance
against
loss or expense from the sickness, or from the bodily
injury
or death from accident of the insured, nor any including a
health insurance policy, and shall not use an application, rider,
or
endorsement to be used in connection therewith, shall be
delivered
or issued for delivery to any person in this state, with
the policy until a copy of the policy form, the rate, and the
classification
of risks and any premium rates pertaining thereto
have
been filed with and approved by the department of
insurance.director.
(2) The director may, within 60 days after the filing of an
individual or small group health insurance policy form or rate or
within 30 days after the filing of another disability insurance
policy form or rate, disapprove the form or rate for any of the
following reasons, subject to the requirements as to notice,
hearing, and appeal in sections 244 and 2236:
(a) The premium is unreasonable in relation to the benefits
provided.
(b) The policy contains a provision that is unjust, unfair,
inequitable, misleading, or deceptive or that encourages
misrepresentation of the policy.
(c) The policy or rate does not comply with other provisions
of law.
(d) With respect to a health insurance policy, the rate is
unreasonably lower than what is necessary to meet the expenses of
the insurer for providing the coverage and would have an
anticompetitive effect or result in predatory pricing in relation
to coverages offered by other insurers.
(3) The director may at any time withdraw his or her approval
of a policy form or rate on any of the grounds listed in subsection
(2), subject to the requirements as to notice, hearing, and appeal
in sections 244 and 2236. An insurer shall not issue the form or
rate after the effective date of the withdrawal of approval.
(4) Subsection (2) does not apply to a rate for a policy of
health insurance that is the result of collective bargaining and
that affects only the enrollees or insureds who are members of the
group engaged in the collective bargaining. However, an insurer
shall file a rate described in this subsection with the director
within 60 days after the effective date of the policy.
Sec.
3474a. The premium rate charged by an insurer, health
maintenance
organization, or nonprofit health care corporation for
health
insurance coverage offered through a policy or certificate
delivered,
issued for delivery, or renewed in this state on or
after
January 1, 2014 in the individual or small group market shall
vary
based on the following factors only:
(a)
Whether the policy or certificate covers an individual or
family.
(b)
The rating area.
(c)
Age, except that the premium rate shall not vary by more
than
3 to 1 for adults for all plans other than child-only plans.
(d)
Tobacco use, except that the premium rate shall not vary
by
more than 1.5 to 1.
(1) A health insurance policy and the rates for the policy,
including any deductibles, copayments, and coinsurances, must be
fair, sound, and reasonable in relation to the services provided,
and the procedures for offering and terminating health insurance
policies must not be unfairly discriminatory.
(2) A health insurance policy and the rates for the policy
must not discriminate on the basis of race, color, creed, national
origin, residence within the approved service area, if applicable,
lawful occupation, sex, handicap, or marital status, except that
marital status may be used to classify individuals or risks for the
purpose of insuring family units. The director may approve a rate
differential based on sex, age, residence, disability, marital
status, or lawful occupation, if the differential is supported by
sound actuarial principles and a reasonable classification system
and is related to the actual and credible loss statistics or
reasonably anticipated experience for new coverages.
(3) A healthy lifestyle program as defined in section 3517 is
not subject to the director's approval under this section and is
not required to be supported by sound actuarial principles or a
reasonable classification system or to be related to actual and
credible loss statistics or reasonably anticipated experience for
the coverage.
Sec.
3475. (1) Notwithstanding any provision of any a
disability
insurance policy, of
insurance or certificate, if an
insurance
the disability insurance policy or certificate provides
for reimbursement for any service that is legally performed by a
person fully licensed as a psychologist under part 182 of the
public health code, 1978 PA 368, MCL 333.18201 to 333.18237; by a
podiatrist licensed under part 180 of the public health code, 1978
PA 368, MCL 333.18001 to 333.18058; or by a chiropractor licensed
under part 164 of the public health code, 1978 PA 368, MCL
333.16401
to 333.16431, ; the
insurer shall not deny reimbursement
under
the insurance policy or certificate shall not be denied if
the service is rendered by a person fully licensed as a
psychologist under part 182 of the public health code, 1978 PA 368,
MCL 333.18201 to 333.18237; by a podiatrist licensed under part 180
of the public health code, 1978 PA 368, MCL 333.18001 to 333.18058;
or by a chiropractor licensed under part 164 of the public health
code,
1978 PA 368, MCL 333.16401 to 333.16431,
; within the
statutory provisions provided in his or her individual practice
act.
(2) This section does not require coverage for a psychologist
in
any an insurance policy. This section does not require
coverage
or reimbursement for any of the following:
(a)
A practice of chiropractic service unless that the service
was included in the definition of practice of chiropractic under
section 16401 of the public health code, 1978 PA 368, MCL
333.16401, as of January 1, 2009.
(b) A service provided by a physical therapist or physical
therapist
assistant unless that the service was provided by a
licensed physical therapist or physical therapist assistant under
the supervision of a licensed physical therapist pursuant to a
prescription from a health care professional who holds a license
issued under part 166, 170, 175, or 180 of the public health code,
1978 PA 368, MCL 333.16601 to 333.16648, 333.17001 to 333.17084,
333.17501 to 333.17556, and 333.18001 to 333.18058, or the
equivalent license issued by another state.
(3)
This section does not apply to a policy or certificate
written
under section 3405 or 3631 that involves a prudent
purchaser agreement.
Sec.
3476. (1) An expense-incurred hospital, medical, or
surgical
group or individual insurer
that delivers, issues for
delivery,
or renews in this state a health insurance policy or
certificate
delivered, issued for delivery, or renewed in this
state
and a health maintenance organization group or individual
contract
shall not require face-to-face
contact between a health
care professional and a patient for services appropriately provided
through
telemedicine, as determined by the insurer. or health
maintenance
organization. Telemedicine services
shall must be
provided by a health care professional who is licensed, registered,
or otherwise authorized to engage in his or her health care
profession in the state where the patient is located. Telemedicine
services are subject to all terms and conditions of the health
insurance
policy , certificate, or
contract agreed upon between the
policy ,
certificate, or contract holder and
the insurer, or health
maintenance
organization, including, but not
limited to, required
copayments, coinsurances, deductibles, and approved amounts.
(2) As used in this section, "telemedicine" means the use of
an electronic media to link patients with health care professionals
in different locations. To be considered telemedicine under this
section, the health care professional must be able to examine the
patient via a real-time, interactive audio or video, or both,
telecommunications system and the patient must be able to interact
with the off-site health care professional at the time the services
are provided.
(3)
This section applies to a policy, certificate, or contract
issued
or renewed on or after January 1, 2013.
Sec. 3477. (1) An insurer shall not use any financial
incentive or make any payment to a health professional that acts
directly or indirectly as an inducement to deny, reduce, limit, or
delay specific medically necessary and appropriate services.
(2) Subsection (1) does not prohibit payment arrangements that
are not tied to specific medical decisions or prohibit the use of
risk sharing as otherwise authorized in this chapter.
Sec. 3501. As used in this chapter:
(a) "Affiliated provider" means a health professional,
licensed hospital, licensed pharmacy, or any other institution,
organization,
or person having a that
has entered into a
participating provider contract as prescribed in section 2212d,
directly or indirectly, with a health maintenance organization to
render
1 or more health maintenance services to an enrollee.
Affiliated provider includes a person described in this subdivision
that has entered into a written arrangement with another person,
including, but not limited to, a physician hospital organization or
physician organization, that contracts directly with a health
maintenance organization.
(b) "Basic health services" means medically necessary health
services that health maintenance organizations must offer to large
employers in at least 1 health maintenance contract. Basic health
services include all of the following:
(i) Physician services including consultant and
referral
services
by a physician, but not including psychiatric services.
primary care and specialty care.
(ii) Ambulatory services.
(iii) Inpatient hospital services. ,
other than those for the
treatment
of mental illness.
(iv) Emergency health services.
(v) Outpatient mental Mental health
and substance use disorder
services. ,
not fewer than 20 visits per year.
(vi) Intermediate and outpatient care for substance
abuse as
follows:
(A)
For group contracts, if the fees for a group contract
would
be increased by 3% or more because of the provision of
services
under this subparagraph, the group subscriber may decline
the
services. For individual contracts, if the total fees for all
individual
contracts would be increased by 3% or more because of
the
provision of the services required under this subparagraph in
all
of those contracts, the named subscriber of each contract may
decline
the services.
(B)
Charges, terms, and conditions for the services required
to
be provided under this subparagraph shall not be less favorable
than
the maximum prescribed for any other comparable service.
(C)
The services required to be provided under this
subparagraph
shall not be reduced by terms or conditions that apply
to
other services in a group or individual contract. This sub-
subparagraph
shall not be construed to prohibit contracts that
provide
for deductibles and copayment provisions for services for
intermediate
and outpatient care for substance abuse.
(D)
The services required to be provided under this
subparagraph
shall, at a minimum, provide for up to $2,968.00 in
services
for intermediate and outpatient care for substance abuse
per
individual per year. This minimum shall be adjusted annually by
March
31 each year in accordance with the annual average percentage
increase
or decrease in the United States consumer price index for
the
12-month period ending the preceding December 31.
(E)
As used in this subparagraph, "intermediate care",
"outpatient
care", and "substance abuse" have those meanings
ascribed
to them in section 3425.
(vi) (vii) Diagnostic
laboratory and diagnostic and
therapeutic radiological services.
(vii) (viii) Home
health services.
(viii) (ix) Preventive
health services.
(c) "Credentialing verification" means the process of
obtaining and verifying information about a health professional and
evaluating
that the health professional when that the health
professional applies to become a participating provider with a
health maintenance organization.
(d)
"Enrollee" means an individual who is entitled to receive
health
maintenance services under a health maintenance contract.
(d) (e)
"Health maintenance
contract" means a contract between
a health maintenance organization and a subscriber or group of
subscribers , to provide
, when medically indicated,
designated or
arrange
for the provision of health maintenance
services , as
described
in and pursuant to the terms of the contract, including,
at
a minimum, basic health maintenance services. within the health
maintenance organization's service area. Health maintenance
contract
includes a prudent purchaser contract.agreement under
section 3405.
(e) (f)
"Health maintenance
organization" means an entity a
person that, among other things, does the following:
(i) Delivers health maintenance services that
are medically
indicated
necessary to enrollees under the terms of its health
maintenance contract, directly or through contracts with affiliated
providers, in exchange for a fixed prepaid sum or per capita
prepayment, without regard to the frequency, extent, or kind of
health services.
(ii) Is responsible for the availability, accessibility, and
quality
of the health maintenance services provided.
(g)
"Health maintenance services" means services provided to
enrollees
of a health maintenance organization under their health
maintenance
contract.
(f) (h)
"Health professional"
means an individual licensed,
certified, or authorized in accordance with state law to practice a
health profession in his or her respective state.
(i)
"Primary verification" means verification by the health
maintenance
organization of a health professional's credentials
based
upon evidence obtained from the issuing source of the
credential.
(j)
"Prudent purchaser contract" means a contract offered by a
health
maintenance organization to groups or to individuals under
which
enrollees who select to obtain health care services directly
from
the organization or through its affiliated providers receive a
financial
advantage or other advantage by selecting those
providers.
(k)
"Secondary verification" means verification by the health
maintenance
organization of a health professional's credentials
based
upon evidence obtained by means other than direct contact
with
the issuing source of the credential.
(g) "Health services" means services provided to enrollees of
a health maintenance organization under their health maintenance
contract.
(h) (l) "Service
area" means a defined geographical area in
which
covered health maintenance services are generally
available
and readily accessible to enrollees and where health maintenance
organizations may market their contracts.
(m)
"Subscriber" means an individual who enters into a health
maintenance
contract, or on whose behalf a health maintenance
contract
is entered into, with a health maintenance organization
that
has received a certificate of authority under this chapter and
to
whom a health maintenance contract is issued.
Sec.
3503. (1) All Unless
specifically excluded, or otherwise
specifically provided for in this chapter, all of the provisions of
this
act that apply to a domestic insurer authorized to issue an
expense-incurred
hospital, medical, or surgical policy or
certificate,
including, but not limited to, sections 223 and 7925
and
chapters 34 and 36, a health
insurance policy apply to a health
maintenance
organization. under this chapter unless specifically
excluded,
or otherwise specifically provided for in this chapter.
(2)
Sections 408, 410, 411, and 901, and 5208, chapter
chapters
77 , and , except as otherwise provided in subsection (1),
chapter
79 do not apply to a health
maintenance organization.
Sec.
3505. (1) A health maintenance organization shall receive
not issue a health maintenance contract before it receives a
certificate
of authority under this chapter before issuing health
maintenance
contracts. A health maintenance organization license
issued
under former part 210 of the public health code, 1978 PA
368,
automatically becomes a certificate of authority under this
chapter
on the effective date of this chapter.act.
(2)
"Health A person
shall not use the term health maintenance
organization"
shall not be used organization
to describe or refer
to
any entity or a person, and an entity or a person
shall not use
any other descriptive words that may mislead, deceive, or imply
that
it is a health maintenance organization, unless the entity or
person described or referred to has a certificate of authority as a
health
maintenance organization under this chapter.act.
(3)
A Except as otherwise
provided in this subsection, a
health maintenance organization shall not use in its name,
contracts, or literature the words "insurance", "casualty",
"surety",
or "mutual" , or any
other words descriptive of an
insurance, casualty, or surety business or deceptively similar to
the name or description of an insurance or surety corporation doing
business in this state. A health maintenance organization may use a
name or description that is similar to its affiliate.
Sec.
3507. The commissioner director
shall establish a system
of authorizing and regulating health maintenance organizations in
this state to protect and promote the public health through the
assurance that the organizations provide all of the following:
(a) An acceptable quality of health care by qualified
personnel.
(b) Health care facilities, equipment, and personnel that may
reasonably
be required to economically provide health maintenance
services.
(c) Operational arrangements that integrate the delivery of
various services.
(d)
A financially Financially sound prepayment plan plans for
meeting health care costs.
Sec. 3508. (1) A health maintenance organization shall develop
and
maintain a quality assessment program to assess the quality of
health
care provided to enrollees that
includes, at a minimum,
systematic collection, analysis, and reporting of relevant data in
accordance
with statutory and regulatory requirements. A health
maintenance
organization shall make available its quality
assessment
program as prescribed by the commissioner.
(2) A health maintenance organization shall establish and
maintain a quality improvement program to design, measure, assess,
and improve the processes and outcomes of health care as identified
in
the program. A health maintenance organization shall make
available
its quality improvement program as prescribed by the
commissioner.
The place the quality improvement program shall be
under
the direction of the health maintenance organization's its
medical
director and shall include
all of the following in the
program:
(a) A written statement of the program's objectives, lines of
authority and accountability, evaluation tools, including data
collection responsibilities, and performance improvement
activities.
(b) An annual effectiveness review of the program.
(c) A written quality improvement plan that, at a minimum,
describes how the health maintenance organization analyzes both the
processes and outcomes of care, identifies the targeted diagnoses
and treatments to be reviewed each year, uses a range of
appropriate methods to analyze quality, compares program findings
with past performance and internal goals and external standards,
measures the performance of affiliated providers, and conducts peer
review activities.
Sec.
3509. (1) An application to the commissioner director for
a
certificate of authority shall must
be on a form prescribed and
provided
by the commissioner.director.
(2) A certificate of authority issued to a health maintenance
organization
under this chapter act is
limited to the service area
described
in the application upon on
which the certificate of
authority was issued. Approved parts of a health maintenance
organization's service area are not required to be contiguous.
(3) A health maintenance organization seeking to change the
approved service area shall submit an application to change service
area
to the commissioner director
and shall not change the service
area
until approval is received. The commissioner director shall
specify the information required to be in the application under
this subsection.
Sec.
3511. (1) By the end of the first 12 months of operation,
a
A health maintenance organization's governing body organization
that is under a contract with this state to provide medical
services authorized under subchapter XIX or XXI of the social
security act, 42 USC 1396 to 1396w-5 and 1397aa to 1397mm, shall
have
a comply with either of the
following requirements:
(a) A minimum of 1/3 of its governing body must be
representatives
of its membership consisting of adult
enrollees of
the organization who are not compensated officers, employees,
stockholders
who own more than 5% of the organization's shares, or
other individuals responsible for the conduct of, or financially
interested
in, the organization's affairs. The enrollee board
members
shall be elected by a simple plurality of the voting
subscribers.
Each subscriber shall have 1 vote. The enrollee board
members
shall hold office for 3 years after their election, except
that
the terms of office following the first enrollee election may
be
adjusted to allow the terms of enrollee board members to expire
on
a staggered basis. A vacancy among enrollee board members shall
be
filled by appointment by a simple majority of the remaining
enrollee
members of the board from individuals meeting the
qualifications
of this section. A vacancy shall be filled only for
the
unexpired portion of the original term, at which time the
enrollee
member shall be elected in the manner prescribed by this
chapter.
(b) The health maintenance organization must establish a
consumer advisory council that reports to the governing body. The
consumer advisory council must include at least 1 enrollee, 1
family member or legal guardian of an enrollee, and 1 consumer
advocate.
(2) A health maintenance organization's governing body shall
meet at least quarterly unless specifically exempted from this
requirement
by the commissioner.director.
Sec.
3513. (1) The commissioner director
shall regulate health
delivery
aspects of health maintenance organization operations for
the
purpose of assuring to ensure
that health maintenance
organizations are capable of providing care and services promptly,
appropriately,
and in a manner that assures ensures
continuity and
acceptable
quality of health care. The commissioner director shall
encourage
health maintenance organizations to utilize use a
wide
variety of health-related disciplines and facilities and to develop
services that contribute to the prevention of disease and
disability
and to the restoration of health.
(2)
The commissioner director shall regulate the business and
financial
aspects of health maintenance organization operations for
the
purpose of assuring that the organizations are financially
sound
and follow acceptable business practices. The commissioner
shall
assure ensure that the health maintenance organizations
operate in the interest of enrollees consistent with overall health
care cost containment while delivering acceptable quality of care
and services that are available and accessible to enrollees with
appropriate administrative costs and health care provider
incentives. A health maintenance organization shall do all of the
following:
(a)
Provide, as promptly as appropriate, health maintenance
services
in a manner that assures ensures
continuity and imparts
quality
health care under conditions the commissioner director
considers to be in the public interest.
(b)
Provide , within the geographic area served by the health
maintenance
organization, health maintenance
services within its
service
area that are available, accessible,
and provided as
promptly
as appropriate to each of its enrollees in a manner that
assures
continuity, and are available and
accessible to enrollees
24 hours a day and 7 days a week for the treatment of emergency
episodes of illness or injury.
(c)
Provide adequate arrangements for a continuous evaluation
of
the quality of health care.
(c) (d)
Provide that reasonable provisions
exist for an
enrollee to obtain emergency health services both within and
outside
of the geographic its
service area. served
by the health
maintenance
organization.
(e)
Provide that reasonable procedures exist for resolving
enrollee
grievances as required by this chapter or as otherwise
provided
by law.
(3) (f)
Be A health maintenance
organization must be
incorporated as a distinct legal entity under the business
corporation act, 1972 PA 284, MCL 450.1101 to 450.2098, the
nonprofit corporation act, 1982 PA 162, MCL 450.2101 to 450.3192,
or the Michigan limited liability company act, 1993 PA 23, MCL
450.4101 to 450.5200.
(g)
Have a governing body that meets the requirements of this
chapter.
Sec. 3515. (1) A health maintenance organization may provide
additional
health maintenance services or any other related health
care
service or treatment not required under this chapter.act.
(2) A health maintenance organization may have health
maintenance contracts with deductibles. A health maintenance
organization may have health maintenance contracts that include
copayments, stated as dollar amounts for the cost of covered
services, and coinsurance, stated as percentages for the cost of
covered
services. Coinsurance for basic health services, excluding
deductibles,
shall not exceed 50% of a health maintenance
organization's
reimbursement to an affiliated provider for
providing
the service to an enrollee and shall not be based on the
provider's
standard charge for the service. This
subsection does
not
limit the commissioner's director's
authority to regulate and
establish fair, sound, and reasonable copayment and coinsurance
limits including out of pocket maximums.
(3)
By May 15, 2008, and by each May 15 after 2008, the
commissioner
shall make a determination as to whether the greater
copayment
and coinsurance levels allowed by the amendatory act that
added
this subsection have increased the number of employers who
have
contracted for health maintenance organization services and
whether
these levels have increased the number of enrollees
receiving
health maintenance organization services. In making this
determination,
the commissioner shall hold a public hearing by
February
1, 2008, and may hold a public hearing thereafter, shall
seek
the advice and input from appropriate independent sources,
including,
but not limited to, all health maintenance organizations
operating
in this state and with enrollees in this state, and shall
issue
a report delineating specific examples of copayment and
coinsurance
levels in force and suggestions to increase the number
of
persons enrolled in health maintenance organizations.
(4)
If the results of the report issued under subsection (3)
are
disputed or if the commissioner determines that the
circumstances
that the report was based on have changed, the
commissioner
shall issue a supplemental report to the report under
subsection
(3) that includes copies of the written objections
disputing
the commissioner's report determinations or that
specifies
the change of circumstances. The supplemental report
shall
be issued not later than December 15 immediately following
the
release of the report under subsection (3) that this report
supplements
and shall be supported by substantial evidence.
(5)
All of the following shall be considered by the
commissioner
for purposes of subsections (3) and (4):
(a)
Information and data gathered from health maintenance
organizations
regarding the effects of greater copayment and
coinsurance
levels allowed by the amendatory act that added this
subsection.
(b)
Information and data provided by employers who employ
residents
of this state.
(c)
Any other information and data the commissioner considers
relevant.
(6)
The reports and certifications required under subsections
(3)
and (4) shall be forwarded to the governor, the clerk of the
house
of representatives, the secretary of the senate, and all
members
of the senate and house of representatives standing
committees
on insurance and health issues.
(3) (7)
A health maintenance organization
shall not require
that contributions be made to a deductible for preventive health
care services. As used in this subsection, "preventive health care
services" means services designated to maintain an individual in
optimum health and to prevent unnecessary injury, illness, or
disability.
(4) (8)
A health maintenance organization
may accept from
governmental agencies and from private persons payments covering
any part of the cost of health maintenance contracts.
Sec. 3517. (1) A health maintenance contract shall not provide
for
payment of cash or other material benefit to an enrollee ,
except
other than as stated in this chapter.permitted under the law
of this state or as approved by the director under section 2236.
(2) Subsection (1) does not prohibit a health maintenance
organization from promoting optimum health by offering to all
currently enrolled subscribers or to all currently covered
enrollees
1 or more healthy lifestyle programs. A As used in this
subsection, "healthy lifestyle program" means a program recognized
by a health maintenance organization that enhances health, educates
enrollees on health-related matters, or reduces risk of disease,
including, but not limited to, promoting nutrition and physical
exercise and compliance with disease management programs and
preventive service guidelines that are supported by evidence-based
medical practice. A healthy lifestyle program may include other
requirements in addition to those that enhance health, educate
enrollees on health-related matters, or reduce risk of disease if
the healthy lifestyle program, taken as a whole, meets the intent
of this subsection. Subsection (1) does not prohibit a health
maintenance organization from offering a currently enrolled
subscriber or currently covered enrollee goods, vouchers, or
equipment that supports achieving optimal health goals. An offering
of goods, vouchers, or equipment under this subsection is not a
violation
of subsection (1) and shall is
not be considered valuable
consideration, a material benefit, a gift, a rebate, or an
inducement under this act.
(3) For an emergency episode of illness or injury that
requires immediate treatment before it can be secured through the
health maintenance organization, or for an out-of-area service
specifically authorized by the health maintenance organization, an
enrollee
may utilize use a provider within in or without
outside of
this state not normally engaged by the health maintenance
organization to render service to its enrollees. The health
maintenance organization shall pay reasonable expenses or fees to
the provider or enrollee as appropriate in an individual case.
These
transactions are not considered acts of insurance and, except
as provided in this chapter and section 3406k, are not otherwise
subject to this act.
Sec.
3519. (1) A health maintenance organization contract and
the
contract's rates, including any deductibles, copayments, and
coinsurances,
between the organization and its subscribers shall be
fair,
sound, and reasonable in relation to the services provided,
and
the procedures for offering and terminating contracts shall not
be
unfairly discriminatory.
(2)
A health maintenance organization contract and the
contract's
rates shall not discriminate on the basis of race,
color,
creed, national origin, residence within the approved
service
area of the health maintenance organization, lawful
occupation,
sex, handicap, or marital status, except that marital
status
may be used to classify individuals or risks for the purpose
of
insuring family units. The commissioner may approve a rate
differential
based on sex, age, residence, disability, marital
status,
or lawful occupation, if the differential is supported by
sound
actuarial principles, a reasonable classification system, and
is
related to the actual and credible loss statistics or reasonably
anticipated
experience for new coverages. A healthy lifestyle
program
as defined in section 3517(2) is not subject to the
commissioner's
approval under this subsection and is not required
to
be supported by sound actuarial principles, a reasonable
classification
system, or be related to actual and credible loss
statistics
or reasonably anticipated experience for new coverages.
(3)
All health maintenance organization contracts shall
include,
at a minimum, offer basic health services to large
employers in at least 1 health maintenance contract.
Sec.
3528. (1) A health maintenance organization shall do all
of
the following:
(a)
Establish establish written policies and procedures for
credentialing verification of all health professionals with whom
the
health maintenance organization contracts. and A health
maintenance organization shall apply these standards consistently.
This act does not require a health maintenance organization to
select a provider as an affiliated provider solely because the
provider meets the health maintenance organization's credentialing
verification standards. This act does not prevent a health
maintenance organization from using separate or additional criteria
in selecting the health professionals with whom it contracts.
(b)
Verify the credentials of a health professional before
entering
into a contract with that health professional. The health
maintenance
organization's medical director or other designated
health
professional shall have responsibility for, and shall
participate
in, health professional credentialing verification.
(c)
Establish a credentialing verification committee
consisting
of licensed physicians and other health professionals to
review
credentialing verification information and supporting
documents
and make decisions regarding credentialing verification.
(d)
Make available for review by the applying health
professional
upon written request all application and credentialing
verification
policies and procedures.
(e)
Retain all records and documents relating to a health
professional's
credentialing verification process for at least 2
years.
(f)
Keep confidential all information obtained in the
credentialing
verification process, except as otherwise provided by
law.
(2)
A health maintenance organization shall obtain primary
verification
of at least all of the following information about an
applicant
to become a health professional with the health
maintenance
organization:
(a)
Current license to practice in this state and history of
licensure.
(b)
Current level of professional liability coverage, if
applicable.
(c)
Status of hospital privileges, if applicable.
(3)
A health maintenance organization shall obtain, subject to
either
primary or secondary verification at the health maintenance
organization's
discretion, all of the following information about
an
applicant to become an affiliated provider with the health
maintenance
organization:
(a)
The health professional's license history in this and all
other
states.
(b)
The health professional's malpractice history.
(c)
The health professional's practice history.
(d)
Specialty board certification status, if applicable.
(e)
Current drug enforcement agency (DEA) registration
certificate,
if applicable.
(f)
Graduation from medical or other appropriate school.
(g)
Completion of postgraduate training, if applicable.
(4)
A health maintenance organization shall obtain at least
every
3 years primary verification of all of the following for a
participating
health professional:
(a)
Current license to practice in this state.
(b)
Current level of professional liability coverage, if
applicable.
(c)
Status of hospital privileges, if applicable.
(5)
A health maintenance organization shall require all
participating
providers to notify the health maintenance
organization
of changes in the status of any of the items listed in
this
section at any time and identify for providers the individual
at
the health maintenance organization to whom they should report
changes
in the status of an item listed in this section.
(6)
A health maintenance organization shall provide a health
professional
with the opportunity to review and correct information
submitted
in support of that health professional's credentialing
verification
application as follows:
(a)
Each health professional who is subject to the
credentialing
verification process has the right to review all
information,
including the source of that information, obtained by
the
health maintenance organization to satisfy the requirements of
this
section during the health maintenance organization's
credentialing
process.
(b)
A health maintenance organization shall notify a health
professional
of any information obtained during the health
maintenance
organization's credentialing verification process that
does
not meet the health maintenance organization's credentialing
verification
standards or that varies substantially from the
information
provided to the health maintenance organization by the
health
professional, except that the health maintenance
organization
is not required to reveal the source of information if
the
information is not obtained to meet the requirements of this
section
or if disclosure is prohibited by law.
(c)
A health professional has the right to correct any
erroneous
information. A health maintenance organization shall have
a
formal process by which a health professional may submit
supplemental
or corrected information to the health maintenance
organization's
credentialing verification committee and request a
reconsideration
of the health professional's credentialing
verification
application if the health professional feels that the
health
carrier's credentialing verification committee has received
information
that is incorrect or misleading. Supplemental
information
is subject to confirmation by the health maintenance
organization.
(7)
If a health maintenance organization contracts to have
another
entity perform the credentialing functions required by this
section,
the commissioner shall hold the health maintenance
organization
responsible for monitoring the activities of the
entity
with which it contracts and for ensuring that the
requirements
of this section are met.
(8)
Nothing in this act shall be construed to require a health
maintenance
organization to select a provider as a participating
provider
solely because the provider meets the health maintenance
organization's
credentialing verification standards, or to prevent
a
health maintenance organization from utilizing separate or
additional
criteria in selecting the health professionals with whom
it
contracts.
(2) A health maintenance organization is considered to meet
the requirements of this section if the health maintenance
organization is accredited by a nationally recognized accredited
body approved by the director. As used in this subsection,
"nationally recognized accredited body" includes the National
Committee for Quality Assurance.
Sec.
3533. (1) A Subject to
section 3405, a health maintenance
organization may offer prudent purchaser contracts to groups or
individuals and in conjunction with those contracts a health
maintenance organization may pay or may reimburse enrollees, or may
contract
with another entity person
to pay or reimburse enrollees,
for unauthorized services or for services by nonaffiliated
providers in accordance with the terms of the contract and subject
to copayments, coinsurances, deductibles, or other financial
penalties designed to encourage enrollees to obtain services from
the
organization's affiliated providers.
(2)
Prudent purchaser contracts and the rates charged for them
are
subject to the same regulatory requirements as health
maintenance
contracts. The rates charged by an organization for
coverage
under contracts issued under this section shall not be
unreasonably
lower than what is necessary to meet the expenses of
the
organization for providing this coverage and shall not have an
anticompetitive
effect or result in predatory pricing in relation
to
prudent purchaser agreement coverages offered by other
organizations.
(3)
A health maintenance organization shall not issue prudent
purchaser
contracts unless it is in full compliance with the
requirements
for adequate working capital, statutory deposits, and
reserves
as provided in this chapter and it is not operating under
any
limitation to its authorization to do business in this state.
(4)
A health maintenance organization shall maintain financial
records
for its prudent purchaser contracts and activities in a
form
separate or separable from the financial records of other
operations
and activities carried on by the organization.
Sec. 3535. Solicitation of enrollees or advertising of the
services, charges, or other nonprofessional aspects of the health
maintenance
organization's operation under this section shall is
not
be construed to be in violation of laws relating to
solicitation
or advertising by health professionals.
, but A health
maintenance organization shall not, in its solicitation or
advertising allowed under this section, include advertising that
makes
any a qualitative judgment as to a health professional who
provides
services for a the health maintenance organization. A
health maintenance organization shall not, in its solicitation or
advertising
shall not allowed under
this section, offer a material
benefit or other thing of value as an inducement to prospective
subscribers other than the services of the health maintenance
organization.
Sec. 3544. (1) A health maintenance organization may process
and pay claims on behalf of a noninsured benefit plan only after
the health maintenance organization has received adequate money
from the noninsured benefit plan sponsor to fully cover the claim
payments.
(2) As used in this section, "noninsured benefit plan" means
that term as defined in section 5208.
Sec.
3545. With the commissioner's director's
prior approval,
a health maintenance organization may acquire obligations from
another
managed care entity. The commissioner director shall not
grant
prior approval unless the commissioner director determines
that the transaction will not jeopardize the health maintenance
organization's financial security.
Sec.
3547. (1) The commissioner director
at any time may visit
or examine the health care service operations of a health
maintenance organization and consult with enrollees to the extent
necessary
to carry out the intent of this chapter.act.
(2)
In addition to The
director has the authority granted
under
chapter 2 , the commissioner:with regard to a health
maintenance organization under this chapter.
(3) (a)
Shall have A health
maintenance organization shall
give the director access to all information of the health
maintenance organization relating to the delivery of health
services, including, but not limited to books, papers, computer
databases, and documents, in a manner that preserves the
confidentiality of the health records of individual enrollees.
(4) (b)
May require the submission of At
the request of the
director, a health maintenance organization shall submit
information
regarding a proposed contract between a the health
maintenance
organization and an affiliated provider as that the
commissioner
director considers necessary to assure ensure that
the
contract
is in compliance with this chapter.act.
Sec. 3548. (1) A health maintenance organization shall keep
all of its books, records, and files at or under the control of its
principal place of doing business in this state, and shall keep a
record of all of its securities, notes, mortgages, or other
evidences of indebtedness, representing investment of funds at its
principal place of doing business in this state in the same manner
as provided for in section 5256.
(2) A health maintenance organization shall maintain financial
records for its health maintenance activities separate from the
financial
records of any other operation or activity. carried on by
the
person licensed under this chapter to operate the health
maintenance
organization.
(3) A health maintenance organization shall hold and maintain
legal
title to all assets, including cash and investments. Health A
health
maintenance organization shall not commingle funds and or
assets
shall not be commingled with affiliates or other entities in
pooling or cash management type arrangements with affiliates or
other
persons. All A health
maintenance organization shall
hold all
of
its assets shall be held separate
from all other activities of
other members in a holding company system.
Sec.
3551. (1) A health maintenance organization's
organization
shall determine its minimum net worth shall
be
determined
using accounting procedures
approved by the commissioner
that
director. The accounting
procedures must ensure that a health
maintenance organization is financially and actuarially sound.
(2)
A health maintenance organization licensed under former
part
210 of the public health code, 1978 PA 368, on the effective
date
of this chapter that automatically received a certificate of
authority
under section 3505(1) shall possess and maintain
unimpaired
net worth as required under former section 21034 of the
public
health code, 1978 PA 368, until the earlier of the
following:
(a)
The health maintenance organization attains a level of net
worth
as provided in subsection (3) at which time the health
maintenance
organization shall continue to maintain that level of
net
worth.
(b)
December 31, 2003.
(2) (3)
A health maintenance organization applying for To
obtain
or maintain a certificate of authority on
or after the
effective
date of this chapter and in
this state, a health
maintenance
organization wishing to maintain a certificate of
authority
in this state after December 31, 2003 shall
possess and
maintain unimpaired net worth in an amount determined adequate by
the
commissioner director to continue to comply with section 403
but not in an amount less than the following, as applicable:
(a) For a health maintenance organization that contracts with
or employs providers in numbers sufficient to provide 90% of the
health maintenance organization's benefit payout, minimum net worth
is the greatest of the following:
(i) $1,500,000.00.
(ii) Four percent of the health maintenance organization's
subscription revenue.
(iii) Three months' uncovered expenditures.
(b) For a health maintenance organization that does not
contract with or employ providers in numbers sufficient to provide
90% of the health maintenance organization's benefit payout,
minimum net worth is the greatest of the following:
(i) $3,000,000.00.
(ii) Ten percent of the health maintenance organization's
subscription revenue.
(iii) Three months' uncovered expenditures.
(3) (4)
The commissioner director shall
take into account the
risk-based
capital requirements as developed by the national
association
of insurance commissioners National
Association of
Insurance Commissioners in order to determine adequate compliance
with section 403 under this section.
Sec.
3553. (1) Minimum deposit requirements for a health
maintenance
organization shall be determined as provided under this
section
and using accounting procedures approved by the
commissioner
that ensure that a health maintenance organization is
financially
and actuarially sound.
(2)
A health maintenance organization licensed under former
part
210 of the public health code, 1978 PA 368, on the effective
date
of this chapter that automatically received a certificate of
authority
under section 3505(1) shall possess and maintain a
deposit
as required under former section 21034 of the public health
code,
1978 PA 368, until the earlier of the following:
(a)
The health maintenance organization attains the level of
deposit
as provided in subsection (3) at which time the health
maintenance
organization shall continue to maintain that level of
deposit.
(b)
December 31, 2001.
(1) (3)
A To obtain or maintain a
certificate of authority in
this
state, a health maintenance
organization applying for a
certificate
of authority on or after the effective date of this
chapter
and a health maintenance organization wishing to maintain a
certificate
of authority in this state after December 31, 2001
shall possess and maintain a deposit in an amount determined
adequate
by the commissioner director
to continue to comply with
section 403 but not less than $100,000.00 plus 5% of annual
subscription revenue up to a $1,000,000.00 maximum deposit.
(2) (4)
The A health maintenance
organization shall make the
deposit
required under this section shall be made subsection (1)
with the state treasurer or with a federal or state chartered
financial institution under a trust indenture acceptable to the
commissioner
director for the sole benefit of the subscribers and
enrollees in case of insolvency.
Sec. 3555. A health maintenance organization shall maintain a
financial plan evaluating, at a minimum, cash flow needs and
adequacy
of working capital. The plan shall under this subsection
must do all of the following:
(a) Demonstrate compliance with all health maintenance
organization financial requirements provided for in this
chapter.act.
(b)
Provide for adequate working capital, which shall must not
be
negative at any time. The commissioner director may establish a
minimum working capital requirement for a health maintenance
organization to ensure the prompt payment of liabilities.
(c) Identify the means of achieving and maintaining a positive
cash flow, including provisions for retirement of existing or
proposed indebtedness.
Sec. 3557. A health maintenance organization shall file notice
with
the commissioner director of any substantive changes in
operations
no later than within 30 days after the substantive
change in operations occurs. A substantive change in operations
includes, but is not limited to, any of the following:
(a) A change in the health maintenance organization's officers
or directors. In addition to the notification, the health
maintenance organization shall file a disclosure statement on a
form
prescribed by the commissioner director
for each newly
appointed or elected officer or director.
(b) A change in the location of corporate offices.
(c) A change in the organization's articles of incorporation
or bylaws. A health maintenance organization shall include a copy
of
the revised articles of incorporation or bylaws shall be
included
with the notice.
(d) A change in contractual arrangements under which the
health maintenance organization is managed.
(e) Any other significant change in operations.
Sec. 3559. (1) Subject to subsection (2), a health maintenance
organization shall obtain a reinsurance contract or establish a
plan
of self-insurance as may be necessary to ensure solvency or to
protect subscribers in the event of insolvency. A reinsurance
contract
shall must be with an insurer that is authorized or
eligible
to transact insurance in Michigan.this state.
(2) A health maintenance organization shall file a reinsurance
contract
or plan under subsection (1) shall be filed for approval
with
the commissioner not later than director
within 30 days after
the finalization of the contract or plan. A reinsurance contract or
plan
shall must clearly state all services to be received by the
health maintenance organization. A reinsurance contract or plan
shall
be is considered approved 30 days after it is filed with
the
commissioner
director unless disapproved in writing by the
commissioner
director before the expiration of those the 30
days.
(3) A health maintenance organization shall maintain insurance
coverage to protect the health maintenance organization that
includes, at a minimum, fire, theft, fidelity, general liability,
errors and omissions, director's and officer's liability coverage,
and malpractice insurance. A health maintenance organization shall
obtain
the commissioner's director's
prior approval before self-
insuring for these coverages.
Sec. 3561. A health maintenance organization shall have a plan
for handling insolvency that allows for continuation of benefits
for the duration of the health maintenance contract period for
which premiums have been paid and continuation of benefits to any
member
enrollee who is confined on the date of insolvency in an
inpatient
facility until his or her discharge from that the
facility. Continuation of benefits in the event of insolvency is
satisfied if the health maintenance organization has at least 1 of
the
following, as approved by the commissioner:director:
(a) A financial guarantee contract insured by a surety bond
issued by an independent insurer with a secure rating from a rating
agency that meets the requirements of section 436a(1)(p).
(b) A reinsurance contract issued by an authorized or eligible
insurer to cover the expenses to be paid for continued benefits
after an insolvency.
(c) A contract between the health maintenance organization and
its affiliated providers that provides for the continuation of
provider services in the event of the health maintenance
organization's insolvency. A health maintenance organization shall
include
in a contract under this subdivision shall
provide a
mechanism for appropriate sharing by the health maintenance
organization of the continuation of provider services as approved
by
the commissioner director and shall not provide include a
provision that continuation of provider services is solely the
responsibility of the affiliated providers.
(d) An irrevocable letter of credit.
(e) An insolvency reserve account established with a federal
or state chartered financial institution under a trust indenture
acceptable
to the commissioner director
for the sole benefit of
subscribers and enrollees, equal to 3 months' premium income.
Sec. 3563. (1) If a health maintenance organization becomes
insolvent,
upon the commissioner's director's
order all other
health
maintenance organizations and health
insurers that
participated in the enrollment process with the insolvent health
maintenance organization at a group's last regular enrollment
period shall offer the insolvent health maintenance organization's
and
health insurer's group enrollees a
30-day enrollment period
beginning
on the date of the commissioner's director's order. Each
health
maintenance organization and health insurer
shall offer the
insolvent health maintenance organization's enrollees the same
coverages and rates that it had offered to the enrollees of the
group at its last regular enrollment period.
(2)
If no other health maintenance organization or health
insurer
had been was offered to some groups enrolled in the an
insolvent
health maintenance organization, or if the commissioner
director
determines that the other health
maintenance organizations
or
health insurers lack sufficient
health care delivery resources
to
assure ensure that health care services will be available and
accessible to all of the group enrollees of the insolvent health
maintenance
organization, then the commissioner director shall
allocate equitably the insolvent health maintenance organization's
group contracts for these groups among all health maintenance
organizations that operate within a portion of the insolvent health
maintenance organization's service area, taking into consideration
the health care delivery resources of each health maintenance
organization. Each health maintenance organization to which a group
or
groups are so allocated under
this subsection shall offer the
group or groups the health maintenance organization's existing
coverage that is most similar to each group's coverage with the
insolvent health maintenance organization at rates determined in
accordance with the successor health maintenance organization's
existing rating methodology.
(3)
The commissioner director shall allocate equitably the
insolvent health maintenance organization's nongroup enrollees who
are unable to obtain other coverage among all health maintenance
organizations that operate within a portion of the insolvent health
maintenance organization's service area, taking into consideration
the health care delivery resources of each health maintenance
organization. Each health maintenance organization to which
nongroup enrollees are allocated under this subsection shall offer
the
nongroup enrollees the health maintenance organization's
existing
coverage without a preexisting
condition limitation for
individual
or conversion coverage as determined by the enrollee's
type of coverage in the insolvent health maintenance organization
at
rates determined in accordance with under the successor health
maintenance organization's existing rating methodology. Successor
health maintenance organizations that do not offer direct nongroup
enrollment may aggregate all of the allocated nongroup enrollees
into 1 group for rating and coverage purposes.
(4) If a health maintenance organization that contracts with a
state funded health care program becomes insolvent, the
commissioner
director shall inform the state agency responsible for
the program of the insolvency. Notwithstanding any other provision
of this section to the contrary, enrollees of an insolvent health
maintenance organization covered by a state funded health care
program
may be reassigned in accordance with under state and
federal
statutes governing the particular program.
(5) Notwithstanding any provision of this section to the
contrary, an enrollee of an insolvent health maintenance
organization who is eligible to obtain coverage as either an
individual or a member of a small group under an American health
benefit exchange established or operating in this state pursuant to
the patient protection and affordable care act, Public Law 111-148,
as amended by the health care and education reconciliation act of
2010, Public Law 111-152, may obtain substitute coverage through
the exchange.
Sec. 3569. (1) Except as provided in section 3515(2), a health
maintenance organization shall assume full financial risk on a
prospective
basis for the provision of health maintenance services
under
a health maintenance organization contract.
However, the A
health maintenance organization may do any of the following:
(a) Require an affiliated provider to assume financial risk
under the terms of its contract.
(b) Obtain insurance.
(c) Make other arrangements for the cost of providing to an
enrollee
health maintenance services the aggregate value of which
is more than $5,000.00 in a year for that enrollee.
(2) If the health maintenance organization requires an
affiliated provider to assume financial risk under the terms of its
contract,
the contract shall must require both of the following:
(a) The health maintenance organization to pay the affiliated
provider, including a subcontracted provider, directly or through a
licensed
third party administrator for health maintenance services
provided to its enrollees.
(b) The health maintenance organization to keep all pooled
funds and withhold amounts and account for them on its financial
books
and records and reconcile them at year end in accordance with
the
written agreement between the affiliated provider and the
health
maintenance organization.pursuant
to the contract.
(3)
As used in For purposes of
this section, "requiring a
health maintenance organization requires an affiliated provider to
assume
financial risk" means a transaction whereby risk if it
shares with the affiliated provider, in return for consideration, a
portion of the chance of loss, including expenses incurred, related
to
the delivery of health maintenance services is shared with an
affiliated
provider in return for a consideration. to enrollees.
These
The type of transactions under which a health maintenance
organization may require an affiliated provider to assume financial
risk under this section include, but are not limited to, full or
partial capitation agreements, withholds, risk corridors, and
indemnity agreements.
Sec.
3571. A health maintenance organization is not precluded
from
meeting the requirements of, receiving money from, and
enrolling
beneficiaries or recipients of state and federal health
programs.
A health maintenance organization
that participates in a
state or federal health program shall meet the solvency and
financial requirements of this act, unless the health maintenance
organization
is in receivership or under supervision.
, but
Notwithstanding any provision of this act to the contrary, a health
maintenance organization that participates in a state or federal
health program is not required to offer benefits or services that
exceed
the requirements of the state or federal health applicable
program. This section does not apply to state employee or federal
employee health programs.
Sec.
3573. (1) A person proposing that proposes to operate a
system
of health care delivery and financing that is to be offered
to individuals, whether or not as members of groups, in exchange
for a fixed payment and to be organized so that providers and the
organization are in some part at risk for the cost of services in a
manner similar to a health maintenance organization, but that fails
to
meet the requirements set forth in this chapter, of this act for
a
health maintenance organization, may
operate such a the system of
health
care delivery and financing if the commissioner
director
finds that the proposed operation will benefit persons who will be
served by it. The director shall authorize and regulate the
operation
shall be authorized and regulated of the system in the
same
manner as a health maintenance organization under this chapter
act, including the filing of periodic reports, except to the extent
that
the commissioner director finds that the regulation is
inappropriate to the system of health care delivery and financing.
(2) A person operating a system of health care delivery and
financing under this section shall not advertise or solicit or in
any way identify itself in a manner implying to the public that it
is a health maintenance organization authorized under this
chapter.act.
Sec. 3701. As used in this chapter:
(a) "Actuarial certification" means a written statement by a
member
of the American academy of actuaries Academy of Actuaries or
another
individual acceptable to the commissioner director that a
small
employer carrier is in compliance with the provisions of
section
3705, based upon on the person's individual's examination,
including a review of the appropriate records and the actuarial
assumptions and methods used by the carrier in establishing
premiums for applicable health benefit plans.
(b) "Affiliation period" means a period of time required by a
small employer carrier that must expire before health coverage
becomes effective.
(c) "Base premium" means the lowest premium charged for a
rating period under a rating system by a small employer carrier to
small employers for a health benefit plan in a geographic area.
(d) "Carrier" means a person that provides health benefits,
coverage, or insurance in this state. For the purposes of this
chapter, carrier includes a health insurance company authorized to
do business in this state, a nonprofit health care corporation, a
health maintenance organization, a multiple employer welfare
arrangement, or any other person providing a plan of health
benefits, coverage, or insurance subject to state insurance
regulation.
(e) "COBRA" means the consolidated omnibus budget
reconciliation
act of 1985, Public Law 99-272. , 100 Stat. 82.
(f) "Commercial carrier" means a small employer carrier other
than a nonprofit health care corporation or health maintenance
organization.
(g) "Creditable coverage" means, with respect to an
individual, health benefits, coverage, or insurance provided under
any of the following:
(i) A group health plan.
(ii) A health benefit plan.
(iii) Part A or part B of title subchapter XVIII of the social
security
act, chapter 531, 49 Stat. 620, 42 U.S.C. USC 1395c
to
1395i
and 1395i-2 to 1395i-5, and 42 U.S.C. 1395j to 1395t, 1395u
to
1395w, and 1395w-2 to 1395w-4.1395w-6.
(iv) Title Subchapter XIX of the social
security act, chapter
531,
49 Stat. 620, 42 U.S.C. USC 1396
to 1396r-6 and 1396r-8 to
1396v,
1396w-5, other than coverage consisting solely of benefits
under
section 1929 of title XIX of the social security act, 42
U.S.C.
USC 1396t.
(v) Chapter 55 of title 10 of the United States Code, 10
U.S.C.
USC 1071 to 1110. 1110b. For purposes of coverage under
chapter
55 of title 10 of the United States Code, 10 U.S.C. USC
1071
to 1110, 1110b, "uniformed services" means the armed
forces
and
the commissioned corps of the national oceanic and atmospheric
administration
National Oceanic and
Atmospheric Administration and
of
the public health service.Public
Health Service.
(vi) A medical care program of the Indian health
service
Health Service or of a tribal organization.
(vii) A state health benefits risk pool.
(viii) A health plan offered under the employees
health
benefits
program, chapter 89 of title 5 of
the United States Code,
5
U.S.C. USC 8901 to 8914.
(ix) A public health plan. , which for purposes of
this
chapter
means a plan established or maintained by a state, county,
or
other political subdivision of a state that provides health
insurance
coverage to individuals enrolled in the plan.
(x) A health benefit plan under section 5(e) of title I of the
peace
corps act, Public Law 87-293, 22 U.S.C. USC 2504.
(h) "Eligible employee" means an employee who works on a full-
time basis with a normal workweek of 30 or more hours. Eligible
employee includes an employee who works on a full-time basis with a
normal workweek of 17.5 to 30 hours, if an employer so chooses and
if this eligibility criterion is applied uniformly among all of the
employer's employees and without regard to health status-related
factors.
(i) "Geographic area" means an area in this state that
includes not less than 1 entire county, is established by a carrier
pursuant
to under section 3705, and is
used for adjusting premiums
for a health benefit plan subject to this chapter. In addition, if
the geographic area includes 1 entire county and additional
counties or portions of counties, the counties or portions of
counties must be contiguous with at least 1 other county or portion
of another county in that geographic area.
(j) "Group health plan" means an employee welfare benefit plan
as defined in section 3(1) of subtitle A of title I of the employee
retirement income security act of 1974, Public Law 93-406, 29
U.S.C.
USC 1002, to the extent that the plan provides medical
care,
including items and services paid for as medical care to employees
or their dependents as defined under the terms of the plan directly
or through insurance, reimbursement, or otherwise. As used in this
chapter, all of the following apply to the term group health plan:
(i) Any plan, fund, or program that would not be, but for
section
2721(e) of subpart 4 of part A of title XXVII of the public
health
service act, chapter 373, 110 Stat. 1967, 42 U.S.C. USC
300gg-21,
300gg-21(d), an employee welfare benefit plan and that is
established or maintained by a partnership, to the extent that the
plan, fund, or program provides medical care, including items and
services paid for as medical care, to present or former partners in
the partnership, or to their dependents, as defined under the terms
of the plan, fund, or program, directly or through insurance,
reimbursement
or otherwise, shall be treated, is,
subject to
subparagraph
(ii), as an employee welfare benefit plan that
is a
group health plan.
(ii) The term "employer" also includes the partnership in
relation to any partner.
(iii) The term "participant" also includes an individual who
is, or may become, eligible to receive a benefit under the plan, or
the individual's beneficiary who is, or may become, eligible to
receive a benefit under the plan. For a group health plan
maintained by a partnership, the individual is a partner in
relation to the partnership and for a group health plan maintained
by a self-employed individual, under which 1 or more employees are
participants, the individual is the self-employed individual.
(k) "Health benefit plan" or "plan" means an expense-incurred
hospital, medical, or surgical policy or certificate, nonprofit
health care corporation certificate, or health maintenance
organization contract. Health benefit plan does not include
accident-only, credit, dental, or disability income insurance;
long-term care insurance; coverage issued as a supplement to
liability insurance; coverage only for a specified disease or
illness; worker's compensation or similar insurance; or automobile
medical-payment insurance.
(l) "Index rate" means the arithmetic average during a rating
period of the base premium and the highest premium charged per
employee for each health benefit plan offered by each small
employer carrier to small employers and sole proprietors in a
geographic area.
(m) "Nonprofit health care corporation" means a nonprofit
health
care corporation operating pursuant to under the nonprofit
health care corporation reform act, 1980 PA 350, MCL 550.1101 to
550.1704.
(n)
"Premium" means all money paid by a small employer, a sole
proprietor,
eligible employees, or eligible
persons as a condition
of receiving coverage from a small employer carrier, including any
fees or other contributions associated with the health benefit
plan.
(o) "Public health plan" means a plan established or
maintained by a state, county, or other political subdivision of a
state that provides health insurance coverage to individuals
enrolled in the plan.
(p) (o)
"Rating period" means the
calendar period for which
premiums established by a small employer carrier are assumed to be
in effect, as determined by the small employer carrier.
(q) (p)
"Small employer" means
any person , firm, corporation,
partnership,
limited liability company, or association actively
engaged
in business who, that, on at least 50% of its working days
during
the preceding and current calendar years, employed at least
not
fewer than 2 but and not
more than 50 eligible employees. In
determining
the number of eligible employees, companies persons
that
are affiliated companies with
each other or that are eligible
to
file a combined tax return for state taxation purposes shall be
are considered 1 employer.
(r) (q)
"Small employer carrier"
means either of the
following:
(i) A a
carrier that offers health benefit
plans covering the
employees of a small employer.
(ii) A carrier under section 3703(3).
(r)
"Sole proprietor" means an individual who is a sole
proprietor
or sole shareholder in a trade or business through which
he
or she earns at least 50% of his or her taxable income as
defined
in section 30 of the income tax act of 1967, 1967 PA 281,
MCL
206.30, excluding investment income, and for which he or she
has
filed the appropriate internal revenue service form 1040,
schedule
C or F, for the previous taxable year; who is a resident
of
this state; and who is actively employed in the operation of the
business,
working at least 30 hours per week in at least 40 weeks
out
of the calendar year.
(s) "Waiting period" means, with respect to a health benefit
plan and an individual who is a potential enrollee in the plan, the
period that must pass with respect to the individual before the
individual is eligible to be covered for benefits under the terms
of the plan. For purposes of calculating periods of creditable
coverage
under this chapter, a waiting period shall is not
be
considered as a gap in coverage.
Sec. 3703. (1) This chapter applies to any health benefit plan
that provides coverage to 2 or more employees of a small employer.
(2) This chapter does not apply to individual health insurance
policies that are subject to policy form and premium approval by
the
commissioner.director.
(3)
A nonprofit health care corporation shall make available
upon
request a health benefit plan to a sole proprietor. This
chapter
does apply to a nonprofit health care corporation providing
a
health benefit plan to a sole proprietor and to any other small
employer
carrier that elects to provide a health benefit plan to a
sole
proprietor.
Sec. 3705. (1) For adjusting premiums for health benefit plans
subject to this chapter, a carrier may establish up to 10
geographic areas in this state. A nonprofit health care corporation
shall establish geographic areas that cover all counties in this
state.
(2) Premiums for a health benefit plan under this chapter are
subject to the following:
(a) For a nonprofit health care corporation, only industry and
age may be used for determining the premiums within a geographic
area
for a small employer or sole proprietor located in that the
geographic area. For a health maintenance organization, only
industry, age, and group size may be used for determining the
premiums
within a geographic area for a small employer or sole
proprietor
located in that the geographic
area. For a commercial
carrier, only industry, age, group size, and health status may be
used for determining the premiums within a geographic area for a
small
employer or sole proprietor located in that the geographic
area.
(b) For a health benefit plan delivered, issued for delivery,
or renewed in this state on or after January 1, 2014, the premiums
charged
during a rating period to small employers shall must be
determined only by using the rating factors set forth in section
3474a.
(c) The premiums charged during a rating period by a nonprofit
health care corporation, health maintenance organization, or
commercial carrier for a health benefit plan in a geographic area
to
small employers or sole proprietors located in that the
geographic
area shall must not vary from the index rate for that
the health benefit plan by more than 45% of the index rate.
(d)
For a sole proprietor, a small employer carrier may charge
an
additional premium of up to 25% above the premiums in
subdivision
(b).
(d) (e)
Except as otherwise provided in
this section, the
percentage
increase in the premiums charged to a small employer or
sole
proprietor in a geographic area for
a new rating period shall
must not exceed the sum of the annual percentage adjustment in the
geographic area's index rate for the health benefit plan and an
adjustment
pursuant to under subdivision (a). The adjustment
pursuant
to under subdivision (a) shall must not
exceed 15%
annually
and shall must be adjusted pro rata for rating periods of
less than 1 year. This subdivision does not prohibit an adjustment
due
to because of change in coverage.
(3)
Beginning January 23, 2005, if a small employer had been
was covered by a self-insured health benefit plan immediately
preceding application for a health benefit plan subject to this
chapter, a carrier may charge an additional premium of up to 33%
above the premium in subsection (2)(b) for no more than 2 years.
(4) Health benefit plan options, number of family members
covered,
and medicare Medicare eligibility may be used in
establishing
a small employer's or sole proprietor's premium.
(5) A small employer carrier shall apply all rating factors
consistently
with respect to all small employers and sole
proprietors
in a geographic area. Except as
otherwise provided in
subsection (4), a small employer carrier shall bill a small
employer group only with a composite rate and shall not bill so
that 1 or more employees in a small employer group are charged a
higher
premium than another employee in that the small employer
group.
Sec. 3711. (1) Except as otherwise provided in this section, a
small employer carrier that offers health coverage in the small
employer group market in connection with a health benefit plan
shall
renew or continue in force that the
plan at the option of the
small
employer. or sole proprietor.
(2) Guaranteed renewal under subsection (1) is not required in
cases
of: any of the following
circumstances:
(a)
There is fraud or intentional
misrepresentation of by the
small
employer. or, for
(b) For coverage of an insured individual, there is fraud or
misrepresentation by the insured individual or the individual's
representative. ;
lack
(c)
Lack of payment. ;
noncompliance
(d) Noncompliance with minimum contribution requirements.
(e)
Noncompliance with minimum
participation requirements. ;
if
the
(f) The small employer carrier no longer offers that
particular
type of coverage in the market. ; or if the sole
proprietor
or
(g) The small employer moves outside the geographic area.
(3) A small employer carrier that offers health coverage in
the small employer group market may modify a health benefit plan if
the modification is consistent with state law and effective on a
uniform basis among all small employers with coverage under the
health benefit plan.
Sec.
3723. The provisions of this This
chapter apply applies
to
each a health benefit plan for a small employer or sole
proprietor
that is delivered, issued for
delivery, renewed, or
continued
in this state on or after the effective date of this
chapter.
January 22, 2004. For purposes of this section, the date a
health benefit plan is continued is the first rating period that
begins
on or after the effective date of this chapter.January 22,
2004.
Sec. 4601. As used in this chapter:
(a) "Affiliated company" means a company in the same corporate
system as a parent, an industrial insured, or a member organization
by virtue of common ownership, control, operation, or management.
(b) "Alien captive insurance company" means an insurer formed
to write insurance business for its parents and affiliates and
licensed pursuant to the laws of a country other than the United
States
or any a state, district, commonwealth, territory, or
possession of the United States.
(c) "Association" means a legal group of individuals,
corporations, limited liability companies, partnerships, political
subdivisions, or groups that has been in continuous existence for
at least 1 year and the member organizations of which collectively,
or
which that does itself, own, control, or hold, with power to
vote, all of the outstanding voting securities of an association
captive insurance company incorporated as a stock insurer or
organized as a limited liability company; or has complete voting
control over an association captive insurance company organized as
a mutual insurer.
(d) "Association captive insurance company" means a company
that insures risks of the member organizations of the association
and their affiliated companies.
(e) "Branch business" means any insurance business transacted
by a branch captive insurance company in this state.
(f) "Branch captive insurance company" means an alien captive
insurance
company authorized by the commissioner director to
transact the business of insurance in this state through a business
unit with a principal place of business in this state.
(g) "Branch operations" means any business operations of a
branch captive insurance company in this state.
(h) "Captive insurance company" means a pure captive insurance
company, association captive insurance company, sponsored captive
insurance company, special purpose captive insurance company, or
industrial insured captive insurance company authorized under this
chapter. For purposes of this chapter, a branch captive insurance
company
shall must be a pure captive insurance company with respect
to operations in this state, unless otherwise permitted by the
commissioner.director.
(i)
"Commissioner" means the commissioner of the office of
financial
and insurance regulation or the commissioner's designee.
(i) (j)
"Control", including the
terms "controlling",
"controlled by", and "under common control with", means the
possession, direct or indirect, of the power to direct or cause the
direction of the management and policies of a person, whether
through the ownership of voting securities, by contract other than
a commercial contract for goods or nonmanagement services, or
otherwise, unless the power is the result of an official position
with or corporate office held by the person. Control is presumed to
exist if a person, directly or indirectly, owns, controls, holds
with the power to vote, or holds proxies representing 10% or more
of the voting securities of another person. A showing that control
does not exist may rebut this presumption.
(j) (k)
"Controlled unaffiliated
business" means a company
that
meets to which all of the following apply:
(i) Is The
company is not in the corporate system
of a parent
and affiliated companies.
(ii) Has The company has an existing
contractual relationship
with a parent or affiliated company.
(iii) Has The company has risks
managed by a captive insurance
company in accordance with this chapter.
(k) (l) "Foreign
captive insurer" means an insurer formed
under
the laws of the District of Columbia, or some a state,
commonwealth, territory, or possession of the United States other
than
the this state. of Michigan.
(l) (m)
"GAAP" means generally
accepted accounting principles.
(m) (n)
"Industrial insured"
means an insured that meets to
which all of the following apply:
(i) That The insured procures
insurance by use of the services
of a full-time employee acting as a risk manager or insurance
manager or utilizing the services of a regularly and continuously
qualified insurance consultant.
(ii) Whose The insured's aggregate
annual premiums for
insurance on all risks total at least $25,000.00.
(iii) That The insured has at least 25
full-time employees.
(n) (o)
"Industrial insured captive
insurance company" means a
company that insures risks of the industrial insureds that comprise
the industrial insured group and their affiliated companies.
(o) (p)
"Industrial insured
group" means a group that meets
either of the following criteria:
(i) Is The
group is a group of industrial insureds
that
collectively own, control, or hold, with power to vote, all of the
outstanding voting securities of an industrial insured captive
insurance company incorporated as a stock insurer or limited
liability company or have complete voting control over an
industrial insured captive insurance company incorporated as a
mutual insurer.
(ii) Is The
group is a group created under the
liability risk
retention act of 1986, 15 USC 3901 to 3906, and chapter 18, as a
corporation or other limited liability association taxable as a
stock insurance company or a mutual insurer under this chapter.
(p) (q)
"Irrevocable letter of
credit" means a letter of
credit that meets the description in section 1105(c).
(q) (r)
"Member organization"
means any an individual,
corporation, limited liability company, partnership, or association
that belongs to an association.
(r) (s)
"Office" means the office
of financial and insurance
regulation.department.
(s) (t)
"Organizational document"
means the articles of
incorporation, articles of organization, bylaws, operating
agreement, or other foundational documents that create a legal
entity or prescribe its existence.
(t) (u)
"Parent" means any a corporation,
limited liability
company, partnership, or individual that directly or indirectly
owns, controls, or holds with power to vote more than 50% of the
outstanding voting interests of a company.
(u) (v)
"Participant" means an
entity as described in section
4667,
and any affiliates of that the
entity, that are insured by a
sponsored
captive insurance company, where if the recovery of the
participant is limited through a participant contract to the assets
of a protected cell.
(v) (w)
"Participant contract"
means a contract by which a
sponsored captive insurance company insures the risks of a
participant and limits the recovery of the participant to the
assets of a protected cell.
(w) (x)
"Protected cell" means a
segregated account
established and maintained by a sponsored captive insurance company
for 1 participant.
(x) (y)
"Pure captive insurance
company" means a company that
insures risks of its parent, affiliated companies, controlled
unaffiliated
business, businesses, or a combination of its parent,
affiliated companies, and controlled unaffiliated
business.businesses.
(y) (z)
"Qualified United States
financial institution" means
that term as defined in section 1101.
(z) (aa)
"Safe, reliable, and entitled
to public confidence"
means
that term as defined in section 116(d).116.
(aa) (bb)
"Special purpose captive
insurance company" means a
captive insurance company that is authorized under this chapter and
chapter 47 that does not meet the definition of any other type of
captive insurance company defined in this section.
(bb) (cc)
"Sponsor" means an entity
that meets the
requirements
of section 4665 and is approved by the commissioner
director to provide all or part of the capital and retained
earnings required by applicable law and to organize and operate a
sponsored captive insurance company.
(cc) (dd)
"Sponsored captive insurance
company" means a
captive insurance company in which the minimum capital and retained
earnings required by applicable law is provided by 1 or more
sponsors, that is authorized under this chapter, that insures the
risks of separate participants through the participant contract,
and that segregates each participant's liability through 1 or more
protected cells.
(dd) (ee)
"Surplus" means
unassigned funds for an entity using
statutory accounting principles, with capital and surplus including
all capital stock, paid in capital and contributed surplus, and
other surplus funds with corresponding items under GAAP consisting
of retained earnings and accumulated other comprehensive income,
with capital and retained earnings including all capital stock,
additional paid in capital, and other equity funds.
(ee) (ff)
"Treasury rates" means
the United States treasury
strips asked yield as published in the Wall Street Journal as of a
balance sheet date.
(ff) (gg)
"Voting security"
includes any security convertible
into or evidencing the right to acquire a voting security.
Sec. 4701. As used in this chapter:
(a) "Affiliated company" means a company in the same corporate
system as a parent, by virtue of common ownership, control,
operation, or management.
(b) "Captive LLC" means a limited liability company
established under the Michigan limited liability company act, 1993
PA
23, MCL 450.4101 to 450.5200, or a
comparable provisions of any
other
law of another state, law, including the District of
Columbia, by a parent, counterparty, affiliated company, or SPFC
for the purpose of issuing SPFC securities, entering an SPFC
contract with a counterparty, or otherwise facilitating an
insurance securitization.
(c)
"Commissioner" means the commissioner of the office of
financial
and insurance regulation or the commissioner's designee.
(c) (d)
"Contested case" means a
proceeding in which the legal
rights, duties, obligations, or privileges of a party are required
by law to be determined by the circuit court after an opportunity
for hearing.
(d) (e)
"Control" including the
terms "controlling",
"controlled by", and "under common control with" means the
possession, direct or indirect, of the power to direct or cause the
direction of the management and policies of a person, whether
through the ownership of voting securities, by contract other than
a commercial contract for goods or nonmanagement services, or
otherwise, unless the power is the result of an official position
with
or corporate office held by the person. Control shall be is
presumed to exist if a person, directly or indirectly, owns,
controls, holds with the power to vote, or holds proxies
representing 10% or more of the voting securities of another
person. This presumption may be rebutted by a showing that control
does not exist. However, for purposes of this chapter, the fact
that an SPFC exclusively provides reinsurance to a ceding insurer
under an SPFC contract is not by itself sufficient grounds for a
finding that the SPFC and ceding insurer are under common control.
(e) (f)
"Counterparty" means an SPFC's
parent or affiliated
company,
or, subject to the prior approval of the commissioner,
director, a nonaffiliated company as ceding insurer to the SPFC
contract.
(f) (g)
"Fair value" means the
following:
(i) For cash, the amount of the cash.
(ii) For assets an asset other than cash,
the amount at which
that
the asset could be bought or sold in a current
transaction
between arm's length, willing parties. If available, the quoted
mid-market
price for the asset in active markets shall must be
used; and if quoted mid-market prices are not available, a value
shall
must be determined using the best information available
considering values of similar assets and other valuation methods,
such as present value of future cash flows, historical value of the
same or similar assets, or comparison to values of other asset
classes, the value of which have been historically related to the
subject asset.
(g) (h)
"Foreign captive" means a
captive insurer formed under
the
laws of the District of Columbia or some a state, commonwealth,
territory,
or possession of the United States other than the state
of
Michigan.this state.
(h) (i)
"Insolvency" or
"insolvent" means 1 or more of the
following:
(i) That the SPFC is unable to pay its obligations within 30
days after they are due, unless those obligations are the subject
of a bona fide dispute.
(ii) That the admitted assets of the SPFC do not exceed
liabilities plus minimum capital and surplus for a period of time
in excess of 30 days.
(iii) That the Ingham county County circuit
court has issued
an order as provided for in section 8113, 8117, or 8120 in
connection with a delinquency proceeding under chapter 81
instituted against the SPFC.
(i) (j)
"Insurance securitization"
means a package of related
risk transfer instruments, capital market offerings, and
facilitating administrative agreements by which all of the
following apply:
(i) The proceeds of the sale of SPFC securities are obtained,
in a transaction that complies with applicable securities laws, by
an SPFC directly through the issuance of the SPFC securities by the
SPFC or indirectly through the issuance of preferred securities by
the SPFC in exchange for some or all of the proceeds of the sale of
SPFC securities by the SPFC's parent, an affiliated company of the
SPFC, a counterparty, or a captive LLC.
(ii) The proceeds of the issuance of the SPFC securities
secure the obligations of the SPFC under 1 or more SPFC contracts
with a counterparty.
(iii) The obligation to the holders of the SPFC securities is
secured by assets obtained with proceeds of the SPFC securities in
accordance with the transaction terms.
(j) (k)
"Irrevocable letter of
credit" means a letter of
credit that meets the description in section 1105(c).
(k) (l) "Management"
means the board of directors, managing
board, or other individual or individuals vested with overall
responsibility for the management of the affairs of the SPFC,
including the election and appointment of officers or other agents
to act on behalf of the SPFC.
(l) (m)
"Office" means the office
of financial and insurance
regulation.department.
(m) (n)
"Organizational document"
means the SPFC's articles of
incorporation, articles of organization, bylaws, operating
agreement, or other foundational documents that establish the SPFC
as a legal entity or prescribes its existence.
(n) (o)
"Parent" means any a corporation,
limited liability
company, partnership, or individual that directly or indirectly
owns, controls, or holds with power to vote more than 50% of the
outstanding voting securities of an SPFC.
(o) (p)
"Permitted investments"
means those investments that
meet the qualifications in section 4727(1).
(p) (q)
"Preferred securities"
means securities, whether stock
or debt, issued by an SPFC to the issuer of the SPFC securities in
exchange for some or all of the proceeds of the issuance of the
SPFC securities.
(q) (r)
"Protected cell" means a
segregated account
established and maintained by an SPFC for 1 or more SPFC contracts
that are part of a single securitization transaction as further
provided for in chapter 48.
(r) (s)
"Qualified United States
financial institution" means
that term as defined in section 1101.
(s) (t)
"Reserves" means that
term as used in chapter 8.
(t) (u)
"Safe, reliable, and entitled
to public confidence"
means
that term as defined in section 116(d).116.
(u) (v)
"Securities" means those
different types of debt
obligations, equity, surplus certificates, surplus notes, funding
agreements, derivatives, and other legal forms of financial
instruments.
(v) (w)
"Securities commissioner"
means the
commissioner.securities administrator in the department of
licensing and regulatory affairs.
(w) (x)
"SPFC" or "special
purpose financial captive" means a
captive insurance company, a captive LLC, or a company otherwise
qualified as an authorized insurer that has received a limited
certificate
of authority from the commissioner director for the
purposes provided for in this chapter.
(x) (y)
"SPFC contract" means a
contract between the SPFC and
the counterparty pursuant to which the SPFC agrees to provide
insurance or reinsurance protection to the counterparty for risks
associated with the counterparty's insurance or reinsurance
business.
(y) (z)
"SPFC securities" means
the securities issued pursuant
to an insurance securitization, the proceeds of which are used in
the
manner described in subdivision (j).(i).
(z) (aa)
"Surplus note" means an
unsecured subordinated debt
obligation possessing characteristics consistent with accounting
practices
and procedures designated by the commissioner.director.
(aa) (bb)
"Third party" means a
person unrelated to an SPFC or
its counterparty, or both, that has been aggrieved by a decision of
a
commissioner director regarding that SPFC or its activities.
Sec.
6428. (1) Every An insurer transacting business under
subdivision
(1) of section 6406 (disability
and related insurances)
shall
be 6406(1) is subject to the provisions of sections 2242
(filing
and approval of policy forms), section
2260 (claims
administration
not waiver), and chapter 34. (disability insurance
policies),
and chapter 36 (group and blanket disability insurance).
(2)
Every An insurer transacting business under subdivision
(2)
of section 6406 (loss of
position insurance) shall be 6406(2)
is
subject to the provisions of section
6616, ; and
all policies
issued
after January 1, 1948, shall must
grant such the
nonforfeiture
values under annuity contracts as that are required
of
life insurers under this insurance code.act.
(3)
On and after January 1, 1949, every An insurer transacting
business
under subdivision (3) of section 6406 (life insurance)
shall
be 6406(3) is subject to the provisions of chapters 40 (life
insurance
policies and annuity contracts) and
42. (industrial life
insurance).
Sec. 7060. A MEWA transacting business in this state is also
subject to the following additional sections and chapters of this
act, as applicable, in the same manner as an insurer authorized to
transact insurance in this state:
(a)
Sections Section 240(1)(c), (d), and (h). ,
and (j).
(b) Chapter 12.
(c) Chapter 20.
(d) Chapter 22.
(e) Chapter 34.
(f)
Chapter 36.
(f) (g)
Chapter 44.
(g) (h)
Chapter 81.
Sec. 7705. As used in this chapter:
(a) "Account" means either of the 2 accounts created under
section 7706.
(b) "Association" means the Michigan life and health insurance
guaranty association created under section 7706.
(c) "Authorized assessment" or "authorized" when used in the
context of assessments means a resolution or motion passed by the
association's board of directors that directs that an assessment be
called immediately or in the future from member insurers for a
specific amount. An assessment is authorized when the resolution or
motion is passed.
(d) "Benefit plan" means a specific employee, union, or
association of natural persons benefit plan.
(e) "Called assessment" or "called" when used in the context
of assessments means that a notice has been issued by the
association to member insurers requiring that an authorized
assessment be paid within the time frame set forth within the
notice. An authorized assessment becomes a called assessment when
notice is mailed by the association to member insurers.
(f) "Contractual obligation" means an obligation under covered
policies.
(g)
"Covered policy" means a policy, or contract, or
certificate
under a group policy or contract, or portion thereof,
of a group policy or contract, for which coverage is provided under
section 7704.
(h)
"Health insurance" means disability health insurance
as
defined
described in section 606.607.
(i) "Impaired insurer" means a member insurer considered by
the
commissioner after May 1, 1982, director
to be potentially
unable to fulfill the insurer's contractual obligations or that is
placed under an order of rehabilitation or conservation by a court
of competent jurisdiction. Impaired insurer does not mean an
insolvent insurer.
(j)
"Insolvent insurer" means a member insurer that after May
1,
1982, becomes insolvent and is
placed under an order of
liquidation , by a court of competent jurisdiction with a finding
of insolvency.
(k) "Member insurer" means a person authorized to transact a
kind of insurance or annuity business in this state for which
coverage is provided under section 7704 and includes an insurer
whose certificate of authority in this state may have been
suspended, revoked, not renewed, or voluntarily withdrawn. Member
insurer does not include the following:
(i) A fraternal benefit society.
(ii) A cooperative plan insurer authorized under chapter 64.
(iii) A health maintenance organization authorized or licensed
under chapter 35.
(iv) A mandatory state pooling plan.
(v) A mutual assessment or any entity person that
operates on
an assessment basis.
(vi) A nonprofit dental care corporation operating under 1963
PA 125, MCL 550.351 to 550.373.
(vii) A nonprofit health care corporation operating
under the
nonprofit
health care corporation reform act, 1980 PA 350, MCL
550.1101
to 550.1704.
(vii) (viii) An
insurance exchange.
(viii) (ix) An
organization that has a certificate or license
limited to the issuance of charitable gift annuities.
(ix) (x) Any
entity similar to the entities described in this
subdivision.
(l) "Moody's corporate bond yield average" means the monthly
average
corporates as published by Moody's investors service, inc.,
Investors Service, Inc., or a successor to that service.
(m) "Owner" of a contract or policy and "contract owner" and
"policy owner" mean the person who is identified as the legal owner
under the terms of the contract or policy or who is otherwise
vested with the legal title to the contract or policy through a
valid assignment completed in accordance with the terms of the
contract or policy and properly recorded as the owner on the books
of the insurer. The terms owner, contract owner, and policy owner
do not include persons with a mere beneficial interest in a
contract or policy.
(n) "Person" means an individual, corporation, partnership,
association, or voluntary organization.
(o) "Plan sponsor" means the following:
(i) For a benefit plan established or maintained by a single
employer, the single employer.
(ii) For a benefit plan established or maintained by an
employee organization, the employee or organization.
(iii) For a benefit plan established or maintained by 2 or
more employers or jointly by 1 or more employers and 1 or more
employee organizations, the association, committee, joint board of
trustees, or other similar group of representatives of the parties
who establish or maintain the benefit plan.
(p) "Premiums" means amounts or considerations, by whatever
name called, received on covered policies or contracts less
returned premiums, considerations, and deposits and less dividends
and experience credits. The term "premiums" does not include an
amount or consideration received for a policy or contract, or a
portion of a policy or contract for which coverage is not provided
under
section 7704. However, accessible premiums shall must not
be
reduced
on account because of sections 7704(5)(c) relating to
interest limitations and 7704(6)(b), (c), and (e) relating to
limitations with respect to any 1 individual, any 1 participant,
and
any 1 contract holder. Premiums shall do not include premiums
in excess of the following:
(i) $5,000,000.00 on an unallocated annuity contract not
issued under a governmental retirement plan established under
section 401(k), 403(b), or 457 of the internal revenue code of
1986, 26 USC 401, 403, and 457.
(ii) For multiple nongroup policies of life insurance owned by
1 owner, whether the policyowner is an individual, firm,
corporation, or other person, and whether the persons insured are
officers, managers, employees, or other persons, $5,000,000.00 with
respect to these policies or contracts, regardless of the number of
policies or contracts held by the owner.
(q) "Principal place of business" of a plan sponsor or a
person other than a natural person means the state in which the
natural persons who establish policy for the direction, control,
and coordination of the entity as a whole primarily exercise that
function. In making this determination, the association, in its
reasonable judgment, shall consider all of the following factors:
(i) The state in which the primary executive and
administrative headquarters of the entity is located.
(ii) The state in which the principal office of the chief
executive officer of the entity is located.
(iii) The state in which the board of directors, or the
entity's similar governing person or persons, conducts the majority
of its meetings.
(iv) The state in which the executive or management committee
of the board of directors, or the entity's similar governing person
or persons, conducts the majority of its meetings.
(v) The state from which the management of the overall
operations of the entity is directed.
(vi) For a benefit plan sponsored by affiliated companies
comprising a consolidated corporation, the state in which the
holding company or controlling affiliate has its principal place of
business as determined using subparagraphs (i) to (v). However, for
a plan sponsor, if more than 50% of the participants in the benefit
plan are employed in a single state, that state is the principal
place of business of the plan sponsor.
(vii) For a plan sponsor of a benefit plan, the principal
place of business of the association, committee, joint board of
trustees, or other similar group of representatives of the parties
who
establish or maintain the benefit plan shall be is based
upon
on the location of the principal place of business of the employer
or employee organization that has the largest investment in the
benefit
plan in lieu instead of a specific or clear designation of
a principal place of business.
(r) "Receivership court" means the court in the insolvent
insurer's or impaired insurer's state having jurisdiction over the
conservation, rehabilitation, or liquidation of the insurer.
(s) "Resident" means a person who resides in this state at the
time a member insurer is determined to be an impaired insurer or
insolvent insurer and to whom contractual obligations are owed. A
person
may be considered a resident of only 1 state, which, in
the
case
of for a person other than a natural person, is its
principal
place of business. Citizens of the United States who are either
residents of foreign countries or residents of the United States
possessions, territories, or protectorates that do not have an
association similar to the association created by this chapter
shall
be are considered residents of this state if the insurer
that
issued the policies or contracts is domiciled in this state.
(t) "State" means a state, the District of Columbia, Puerto
Rico, or a United States possession, territory, or protectorate.
(u) "Structured settlement annuity" means an annuity purchased
in order to fund periodic payments for a plaintiff or other
claimant in payment for or with respect to personal injury suffered
by the plaintiff or other claimant.
(v) "Supplemental contract" means a written agreement entered
into for the distribution of proceeds under a life, health, or
annuity policy or contract.
(w) "Unallocated annuity contract" means an annuity contract
or group annuity certificate that is not issued to and owned by an
individual, except to the extent of an annuity benefit guaranteed
to an individual by an insurer under the contract or certificate.
The
term shall also include, Unallocated
annuity contract includes,
but
is not limited to, a guaranteed investment contracts and
contract
or a deposit administration contracts.contract.
Enacting section 1. Sections 2242, 3401, 3406f, 3406g, 3439,
3521, 3523, 3525, 3527, 3537, 3539, 3541, 3542, 3543, 3549, 3565,
3567, 3580, and 3706 and chapter 36 of the insurance code of 1956,
1956 PA 218, MCL 500.2242, 500.3401, 500.3406f, 500.3406g,
500.3439, 500.3521, 500.3523, 500.3525, 500.3527, 500.3537,
500.3539, 500.3541, 500.3542, 500.3543, 500.3549, 500.3565,
500.3567, 500.3580, 500.3600 to 500.3650, and 500.3706, are
repealed.
Enacting section 2. This amendatory act does not take effect
unless all of the following bills of the 98th Legislature are
enacted into law:
(a) Senate Bill No. ____ or House Bill No. 4933 (request no.
00199'15 **).
(b) Senate Bill No. ____ or House Bill No. 4934 (request no.
00200'15 **).