376.421. Group health insurance, authorized categories.
Group health insurance, authorized categories.
376.421. 1. Except as provided in subsection 2 of this section, nopolicy of group health insurance shall be delivered in this state unless itconforms to one of the following descriptions:
(1) A policy issued to an employer, or to the trustees of a fundestablished by an employer, which employer or trustees shall be deemed thepolicyholder, to insure employees of the employer for the benefit ofpersons other than the employer, subject to the following requirements:
(a) The employees eligible for insurance under the policy shall beall of the employees of the employer, or all of any class or classesthereof. The policy may provide that the term employees shall include theemployees of one or more subsidiary corporations, and the employees,individual proprietors, and partners of one or more affiliatedcorporations, proprietorships or partnerships, if the business of theemployer and of such affiliated corporations, proprietorships orpartnerships is under common control. The policy may provide that the termemployees shall include the individual proprietor or partners if theemployer is an individual proprietorship or partnership. The policy mayprovide that the term employees shall include retired employees, formeremployees and directors of a corporate employer. A policy issued to insurethe employees of a public body may provide that the term employees shallinclude elected or appointed officials;
(b) The premium for the policy shall be paid either from theemployer's funds or from funds contributed by the insured employees, orfrom both. Except as provided in paragraph (c) of this subdivision, apolicy on which no part of the premium is to be derived from fundscontributed by the insured employees must insure all eligible employees,except those who reject such coverage in writing; and
(c) An insurer may exclude or limit the coverage on any person as towhom evidence of individual insurability is not satisfactory to the insurerin a policy insuring fewer than ten employees and in a policy insuring tenor more employees if:
a. Application is not made within thirty-one days after the date ofeligibility for insurance; or
b. The person voluntarily terminated the insurance while continuingto be eligible for insurance under the policy; or
c. After the expiration of an open enrollment period during which theperson could have enrolled for the insurance or could have elected anotherlevel of benefits under the policy;
(2) A policy issued to a creditor or its parent holding company or toa trustee or trustees or agent designated by two or more creditors, whichcreditor, holding company, affiliate, trustee, trustees or agent shall bedeemed the policyholder, to insure debtors of the creditor or creditorswith respect to their indebtedness subject to the following requirements:
(a) The debtors eligible for insurance under the policy shall be allof the debtors of the creditor or creditors, or all of any class or classesthereof. The policy may provide that the term debtors shall include:
a. Borrowers of money or purchasers or lessees of goods, services, orproperty for which payment is arranged through a credit transaction;
b. The debtors of one or more subsidiary corporations; and
c. The debtors of one or more affiliated corporations,proprietorships or partnerships if the business of the policyholder and ofsuch affiliated corporations, proprietorships or partnerships is undercommon control;
(b) The premium for the policy shall be paid either from thecreditor's funds or from charges collected from the insured debtors, orfrom both. Except as provided in paragraph (c) of this subdivision, apolicy on which no part of the premium is to be derived from fundscontributed by insured debtors specifically for their insurance must insureall eligible debtors;
(c) An insurer may exclude any debtors as to whom evidence ofindividual insurability is not satisfactory to the insurer in a policyinsuring fewer than ten debtors and in a policy insuring ten or moredebtors if:
a. Application is not made within thirty-one days after the date ofeligibility for insurance; or
b. The person voluntarily terminated the insurance while continuingto be eligible for insurance under the policy; or
c. After the expiration of an open enrollment period during which theperson could have enrolled for the insurance or could have elected anotherlevel of benefits under the policy;
(d) The total amount of insurance payable with respect to anindebtedness shall not exceed the greater of the scheduled or actual amountof unpaid indebtedness to the creditor. The insurer may exclude anypayments which are delinquent on the date the debtor becomes disabled asdefined in the policy;
(e) The insurance may be payable to the creditor or to any successorto the right, title, and interest of the creditor. Such payment orpayments shall reduce or extinguish the unpaid indebtedness of the debtorto the extent of each such payment and any excess of insurance shall bepayable to the insured or the estate of the insured;
(f) Notwithstanding the preceding provisions of this subdivision,insurance on agricultural credit transaction commitments may be written upto the amount of the loan commitment, and insurance on educational credittransaction commitments may be written up to the amount of the loancommitment less the amount of any repayments made on the loan;
(3) A policy issued to a labor union or similar employeeorganization, which shall be deemed to be the policyholder, to insuremembers of such union or organization for the benefit of persons other thanthe union or organization or any of its officials, representatives, oragents, subject to the following requirements:
(a) The members eligible for insurance under the policy shall be allof the members of the union or organization, or all of any class or classesthereof;
(b) The premium for the policy shall be paid either from funds of theunion or organization or from funds contributed by the insured membersspecifically for their insurance, or from both. Except as provided inparagraph (c) of this subdivision, a policy on which no part of the premiumis to be derived from funds contributed by the insured members specificallyfor their insurance must insure all eligible members, except those whoreject such coverage in writing;
(c) An insurer may exclude or limit the coverage on any person as towhom evidence of individual insurability is not satisfactory to the insurerin a policy insuring fewer than ten members and in a policy insuring ten ormore members if:
a. Application is not made within thirty-one days after the date ofeligibility for insurance; or
b. The person voluntarily terminated the insurance while continuingto be eligible for insurance under the policy; or
c. After the expiration of an open enrollment period during which theperson could have enrolled for the insurance or could have elected anotherlevel of benefits under the policy;
(4) A policy issued to a trust, or to the trustee of a fund,established or adopted by two or more employers, or by one or more laborunions or similar employee organizations, or by one or more employers andone or more labor unions or similar employee organizations, which trust ortrustee shall be deemed the policyholder, to insure employees of theemployers or members of the unions or organizations for the benefit ofpersons other than the employers or the unions or organizations, subject tothe following requirements:
(a) The persons eligible for insurance shall be all of the employeesof the employers or all of the members of the unions or organizations, orall of any class or classes thereof. The policy may provide that the termemployees shall include the employees of one or more subsidiarycorporations, and the employees, individual proprietors, and partners ofone or more affiliated corporations, proprietorships or partnerships if thebusiness of the employer and of such affiliated corporations,proprietorships or partnerships is under common control. The policy mayprovide that the term employees shall include the individual proprietor orpartners if the employer is an individual proprietorship or partnership.The policy may provide that the term employees shall include retiredemployees, former employees and directors of a corporate employer. Thepolicy may provide that the term employees shall include the trustees ortheir employees, or both, if their duties are principally connected withsuch trusteeship;
(b) The premium for the policy shall be paid from funds contributedby the employer or employers of the insured persons or by the union orunions or similar employee organizations, or by both, or from fundscontributed by the insured persons or from both the insured persons and theemployer or union or similar employee organization. Except as provided inparagraph (c) of this subdivision, a policy on which no part of the premiumis to be derived from funds contributed by the insured persons specificallyfor their insurance, must insure all eligible persons except those whoreject such coverage in writing;
(c) An insurer may exclude or limit the coverage on any person as towhom evidence of individual insurability is not satisfactory to theinsurer;
(5) A policy issued to an association or to a trust or to thetrustees of a fund established, created and maintained for the benefit ofmembers of one or more associations. The association or associations shallhave at the outset a minimum of fifty members; shall have been organizedand maintained in good faith for purposes other than that of obtaininginsurance; shall have been in active existence for at least two years;shall have a constitution and bylaws which provide that the association orassociations shall hold regular meetings not less than annually to furtherthe purposes of the members; shall, except for credit unions, collect duesor solicit contributions from members; and shall provide the members withvoting privileges and representation on the governing board and committees.The policy shall be subject to the following requirements:
(a) The policy may insure members of such association orassociations, employees thereof, or employees of members, or one or more ofthe preceding, or all of any class or classes thereof for the benefit ofpersons other than the employee's employer;
(b) The premium for the policy shall be paid from funds contributedby the association or associations or by employer members, or by both, orfrom funds contributed by the covered persons or from both the coveredpersons and the association, associations, or employer members;
(c) Except as provided in paragraph (d) of this subdivision, a policyon which no part of the premium is to be derived from funds contributed bythe covered persons specifically for their insurance must insure alleligible persons, except those who reject such coverage in writing;
(d) An insurer may exclude or limit the coverage on any person as towhom evidence of individual insurability is not satisfactory to theinsurer;
(e) If the health benefit plan, as defined in section 376.1350, isdelivered, issued for delivery, continued or renewed, is providing coverageto any resident of this state, and is providing coverage to soleproprietors, self-employed persons, small employers as defined insubsection 2 of section 379.930, RSMo, and large employers, the insurerproviding the coverage to the association or trust or trustees of a fundestablished, created, and maintained for the benefit of members of one ormore associations may be exempt from subdivision (1) of subsection 1 ofsection 379.936, RSMo, as it relates to the association plans establishedunder this section. The director shall find that an exemption would be inthe public interest and approved and that additional classes of businessmay be approved under subsection 4 of section 379.934, RSMo, if thedirector determines that the health benefit plan:
a. Is underwritten and rated as a single employer;
b. Has a uniform health benefit plan design option or options for allparticipating association members or employers;
c. Has guarantee issue to all association members and all eligibleemployees, as defined in subsection 2 of section 379.930, RSMo, of anyparticipating association member company; and
d. Complies with all other federal and state insurance requirements,including but not limited to the small employer health insurance andavailability act under sections 379.930 to 379.952, RSMo;
(6) A policy issued to a credit union or to a trustee or trustees oragent designated by two or more credit unions, which credit union, trustee,trustees or agent shall be deemed the policyholder, to insure members ofsuch credit union or credit unions for the benefit of persons other thanthe credit union or credit unions, trustee or trustees, or agent or any oftheir officials, subject to the following requirements:
(a) The members eligible for insurance shall be all of the members ofthe credit union or credit unions, or all of any class or classes thereof;
(b) The premium for the policy shall be paid by the policyholder fromthe credit union's funds and, except as provided in paragraph (c) of thissubdivision, must insure all eligible members;
(c) An insurer may exclude or limit the coverage on any member as towhom evidence of individual insurability is not satisfactory to theinsurer;
(7) A policy issued to cover persons in a group where that group isspecifically described by a law of this state as one which may be coveredfor group life insurance. The provisions of such law relating toeligibility and evidence of insurability shall apply.
2. Group health insurance offered to a resident of this state under agroup health insurance policy issued to a group other than one described insubsection 1 of this section shall be subject to the followingrequirements:
(1) No such group health insurance policy shall be delivered in thisstate unless the director finds that:
(a) The issuance of such group policy is not contrary to the bestinterest of the public;
(b) The issuance of the group policy would result in economies ofacquisition or administration; and
(c) The benefits are reasonable in relation to the premiums charged;
(2) No such group health insurance coverage may be offered in thisstate by an insurer under a policy issued in another state unless thisstate or another state having requirements substantially similar to thosecontained in subdivision (1) of this subsection has made a determinationthat such requirements have been met;
(3) The premium for the policy shall be paid either from thepolicyholder's funds, or from funds contributed by the covered persons, orfrom both;
(4) An insurer may exclude or limit the coverage on any person as towhom evidence of individual insurability is not satisfactory to theinsurer.
3. As used in this section, insurer shall have the same meaning asthe definition of health carrier under section 376.1350, and "class" meansa predefined group of persons eligible for coverage under a group insurancepolicy where members of a class represent the same or essentially the samehazard; except that, an insurer may offer a policy to an employer thatcharges a reduced premium rate or deductible for employees who do not smokeor use tobacco products as authorized under section 290.145, RSMo, and suchinsurer shall not be considered to be in violation of any unfair tradepractice, as defined in section 379.936, RSMo, even if only some employerselect to purchase such a policy and other employers do not.
(L. 1985 H.B. 623 § 376.420, A.L. 1986 S.B. 774, A.L. 2006 H.B. 1827 merged with S.B. 567 & 792, A.L. 2009 H.B. 919)