Effective Date of Rule: Thirty-one days after filing.

     Purpose: Establish the state transitional reinsurance program for health benefit plan issuers by rule, per RCW 48.43.720.

     Statutory Authority for Adoption: RCW 48.02.060, 48.43.720.

      Adopted under notice filed as WSR 13-01-095 on December 19, 2013.

     A final cost-benefit analysis is available by contacting Meg Jones, P.O. Box 40258, Olympia, WA 98504, phone (360) 725-7170, fax (360) 586-3109, e-mail rulescoordinator@oic.wa.gov.

     Number of Sections Adopted in Order to Comply with Federal Statute: New 1, Amended 0, Repealed 0; Federal Rules or Standards: New 1, Amended 0, Repealed 0; or Recently Enacted State Statutes: New 1, Amended 0, Repealed 0.

     Number of Sections Adopted at Request of a Nongovernmental Entity: New 0, Amended 0, Repealed 0.

     Number of Sections Adopted on the Agency's Own Initiative: New 0, Amended 0, Repealed 0.

     Number of Sections Adopted in Order to Clarify, Streamline, or Reform Agency Procedures: New 0, Amended 0, Repealed 0.

     Number of Sections Adopted Using Negotiated Rule Making: New 0, Amended 0, Repealed 0;      Pilot Rule Making: New 0, Amended 0, Repealed 0; or Other Alternative Rule Making: New 1, Amended 0, Repealed 0.

     Date Adopted: February 11, 2013.

Mike Kreidler

Insurance Commissioner

OTS-5226.3

     (2) The U.S. Department of Health and Human Services (HHS) will operate the transitional health plan reinsurance program for the state of Washington. The program ceases operation on June 30, 2017, for payment of claims incurred through December 31, 2016.

     (3) Contributing entities are not required to remit reinsurance contributions for the following types of coverage:

     (a) Coverage only for accident, or disability income insurance, or any combination thereof;

     (b) Coverage issued as a supplement to liability insurance;

     (c) Liability insurance, including general liability insurance and automobile liability insurance;

     (d) Workers' compensation or similar insurance;

     (e) Automobile medical payment insurance;

     (f) Credit-only insurance;

     (g) Coverage for on-site medical clinics;

     (h) Limited scope dental or vision benefits;

     (i) Benefits for long-term care, nursing home care, home health care, community-based care or any combination thereof;

     (j) Benefits provided under a health flexible spending arrangement as defined in Internal Revenue Code, Section 106 (c)(2) ("Health FSA") if other group health plan coverage, not limited to excepted benefits, is made available for the year to the class of participants by reason of their employment, and the Health FSA is structured so that the maximum benefit payable to any participant in the class for a year cannot exceed two times the participant's salary reduction election under the arrangement for the year (or, if greater, cannot exceed five hundred dollars plus the amount of the participant's salary reduction election). For this purpose, any amount that an employee can elect to receive as taxable income but elects to apply to the Health FSA is considered a salary reduction election (regardless of whether the amount is characterized as salary or as a credit under the Health FSA);

     (k) Coverage for a specified disease or illness, if offered as independent, noncoordinated benefits;

     (l) Hospital indemnity or other fixed indemnity insurance if offered as independent, noncoordinated benefits;

     (m) Medicare supplemental health insurance, and similar supplemental coverage provided to coverage under a group health plan, provided such coverage is offered as a separate insurance policy;

     (n) Other similar insurance coverage under which benefits for medical care are secondary or incidental to other insurance benefits, or that qualify as HIPAA-excepted benefits;

     (o) Medicare advantage, medicaid, or any federal coverage program except multistate Office of Personnel Management plans;

     (p) Washington state health insurance pool and the Preexisting Condition Insurance Plan - Washington.

     (4) As part of its rate filing, a carrier must identify the reinsurance payments received for each nongrandfathered individual health benefit plan for the prior plan or policy year.

     (5) This rule expires September 1, 2017.

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