376.441. Carrier contract replaced by similar benefit plan of another carrier--liability of prior carrier--succeeding carrier coverage requirements.
Carrier contract replaced by similar benefit plan of anothercarrier--liability of prior carrier--succeeding carrier coveragerequirements.
376.441. When one carrier's contract replaces a plan of similarbenefits of another carrier, the prior carrier remains liable only to theextent of its accrued liabilities and extensions of benefits. The positionof the prior carrier shall be the same whether the group policyholder orother entity secures replacement coverage from a new carrier, self-insurer,or foregoes the provision of coverage. Each person who is eligible forcoverage in accordance with the succeeding carrier's plan of benefits inrespect of classes eligible and activity at work and nonconfinement rulesshall be covered by that carrier's plan of benefits. Each person not socovered under the succeeding carrier's plan of benefits must neverthelessbe covered by the succeeding carrier in accordance with the followingprovisions if such individual was validly covered, including benefitextension, under the prior plan on the date of discontinuance and if suchindividual is a member of the class or classes of individuals eligible forcoverage under the succeeding carrier's plan. Any reference in thefollowing provisions to an individual who was or was not totally disabledis a reference to the individual's status immediately prior to the date thesucceeding carrier's coverage becomes effective:
(1) The minimum level of benefits to be provided by the succeedingcarrier shall be the applicable level of benefits of the prior carrier'splan reduced by any benefits payable by the prior plan;
(2) Coverage must be provided by the succeeding carrier until atleast the earliest of the following dates:
(a) The date the individual becomes eligible under the succeedingcarrier's plan;
(b) For each type of coverage, the date the individual's coveragewould terminate in accordance with the succeeding carrier's plan provisionsapplicable to individual termination of coverage, such as at thetermination of employment or ceasing to be eligible dependent, as the casemay be; or
(c) In the case of an individual who was totally disabled, and in thecase of a type of coverage for which section 376.438 requires an extensionof accrued liability, the end of any period of extension or accruedliability which is required of the prior carrier by section 376.438 or, ifthe prior carrier's policy or contract is not subject to that section,would have been required of that carrier had its policy or contract beensubject to section 376.438 at the time the prior plan was discontinued andreplaced by the succeeding carrier's plan;
(3) In the case of a preexisting conditions limitation included inthe succeeding carrier's plan, the level of benefits applicable topreexisting conditions of persons becoming covered by the succeedingcarrier's plan during the period of time this limitation applies under thenew plan shall be the lesser of:
(a) The benefits of the new plan determined without application ofthe preexisting conditions limitation; and
(b) The benefits of the prior plan;
(4) The succeeding carrier, in applying any deductibles or waitingperiods in its plan, shall give credit for the satisfaction or partialsatisfaction of the same or similar provisions under a prior plan providingsimilar benefits. In the case of deductible provisions, the credit shallapply for the same or overlapping benefit periods and shall be given forexpenses actually incurred and applied against the deductible provisions ofthe prior carrier's plan during the ninety days preceding the effectivedate of the succeeding carrier's plan but only to the extent these expensesare recognized under the terms of the succeeding carrier's plan and aresubject to a similar deductible provision. For purposes of thissubdivision, the deductible provisions in insurance policies and healthservices corporation contracts are deemed to be similar to co-paymentprovisions in health maintenance organization contracts;
(5) In any situation where a determination of the prior carrier'sbenefit is required by the succeeding carrier, at the succeeding carrier'srequest the prior carrier shall furnish a statement of the benefitsavailable or pertinent information, sufficient to permit verification ofthe benefit determination or the determination itself by the succeedingcarrier. For the purposes of this section, benefits of the prior plan willbe determined in accordance with all of the definitions, conditions andcovered expense provisions of the prior plan rather than those of thesucceeding plan. The benefit determination will be made as if coverage hadnot been replaced by the succeeding carrier.
(L. 1985 H.B. 623 § 376.440, A.L. 1999 H.B. 903)