SENATE BILL REPORT

SB 6713

BYSenators McCaslin and Smith

Permitting persons to continue group health insurance after the group coverage is terminated, subject to certain conditions.

Senate Committee on Financial Institutions & Insurance

Senate Hearing Date(s):February 4, 1988

Senate Staff:Benson Porter (786-7470)

AS OF FEBRUARY 3, 1988

BACKGROUND:

Health insurers, health care contractors and health maintenance organizations (HMOs) are required to offer a conversion policy or contract to any person covered under a group health plan upon termination of the person's eligibility for coverage under the group health plan.  The conversion plan must conform to statutory benefit requirements and restrictions.

Apart from the conversion policy requirements, insurers, contractors, and HMOs are not required to admit a person under another group plan without proof of insurability.

SUMMARY:

If a person's group health plan is cancelled or nonrenewed by an insurer, contractor, or HMO, the person shall be permitted to obtain coverage under a group plan issued to a different group by the cancelling insurer, contractor, or HMO without proof of insurability, provided, however, the person was eligible for coverage under the different group at the time of cancellation.

The insurer, contractor, or HMO may not charge the person an amount greater than that charged to other members of the different group.

Appropriation:    none

Revenue:    none

Fiscal Note:      none requested