CHAPTER 248
SB 74 – FINAL VERSION
02/10/05 0176s
02/10/05 0190s
01Jun2005… 1334h
06/29/05 2115eba
2005 SESSION
01/09
SENATE BILL 74
COMMITTEE: Banks and Insurance
This bill makes certain technical changes in the insurance laws, including but not limited to:
I. Clarifying the law regarding insurance premium refunds.
II. Changing the time frame for when a producer must report any administrative action taken against the producer in another jurisdiction.
III. Revising the laws relating to forms and rate regulation applicable to workers’ compensation.
IV. Repealing the prospective repeal of the law allowing voluntary small employer health insurance purchasing alliances.
V. Clarifying the managed care law relative to grievance procedures.
This bill is a request of the insurance department.
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Explanation: Matter added to current law appears in bold italics.
Matter removed from current law appears [in brackets and struckthrough.]
Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.
02/10/05 0176s
02/10/05 0190s
01Jun2005… 1334h
06/29/05 2115eba
05-0492
01/09
STATE OF NEW HAMPSHIRE
In the Year of Our Lord Two Thousand Five
AN ACT making certain technical changes in the insurance laws.
Be it Enacted by the Senate and House of Representatives in General Court convened:
248:1 Board of Medicine; Reference Change. Amend RSA 329:17, III-b(a) to read as follows:
III-b.(a) Any referral by the insurance commissioner under RSA 420-J:5-e, [VII] VIII or any complaint alleging that a medical director has committed misconduct as set forth in paragraph VI of this section shall be received and reviewed by the board in accordance with the provisions of this section for potential disciplinary action. For the purposes of this paragraph, “medical director” means a physician licensed under this chapter who is employed by a health carrier or medical utilization review entity and is responsible for the utilization review techniques and methods of the health carrier or medical utilization review entity and their administration and implementation.
248:2 Insurance; Electronic Funds Transfer. Amend RSA 400-A:32-b to read as follows:
400-A:32-b Electronic Funds Transfer. Insurers shall remit taxes by electronic funds transfer according to the following schedule:
I. When the insurer, or group of insurers, had a tax liability in the prior tax year of [$100,000] $40,000 or more, effective January 1, 2006.
II. When the insurer, or group of insurers, had a tax liability in the prior tax year of $30,000 or more, effective January 1, 2007.
III. When the insurer, or group of insurers, had a tax liability in the prior tax year of $20,000 or more, effective January 1, 2008.
248:3 Insurance Companies and Agents; Premium Refunds. Amend RSA 402:81 to read as follows:
402:81 Insurance Premium Refunds.
I. Whenever [a person is owed] an insurer owes a refund on an insurance premium paid [for insurance coverage, the insurance company], that insurer shall pay [such person] the refund within 30 days of the date [upon which] when the refund becomes due.
(a) When an insurance policy is cancelled by [an] a named insured, a refund shall [become] be due [upon receipt by] from the company or its [agent of the policy to be cancelled or] appointed producer receiving:
(1) The original policy to be cancelled; or
(2) A signed lost policy release[, or the date the company or agent receives the]; or
(3) A cancellation request from the insured which has been submitted in accordance with provisions of the policy or statute.
(b) When an insurance policy is cancelled by an insurer, a refund shall become due upon the date of cancellation as stated in the notice of cancellation.
(c) No refund shall be required if the return premium is $1 or less.
(d) For auditable policies, gross unearned premium shall be returned within 30 days from the date of the completed audit.
(e) This paragraph shall not apply to retrospectively rated policies.
II. Whenever [an insurance contract is cancelled at the request of] the premium refunds described in paragraph I are refunded to an authorized third party, such as an insurance [agent for nonpayment of premium, a refund shall become due to the insurance agent upon the effective date of the cancellation. The insurance company shall return any unearned premium to the insurance agent for the account of the insured within the appropriate period specified in paragraph I of this section] producer or a party with cancellation power of attorney from the insured, the authorized third party shall credit the premium refund for the account of the named insured. In the event that crediting of return premiums to the account of the named insured results in a surplus over the amount [due the insurance agent from the insured,] owed the authorized third party by the named insured, the [insurance agent] surplus shall [refund such excess] be paid to the named insured within 10 days of receipt of the return premium, being credited to the third party, provided that no such refund shall be required if it amounts to less than $1.
III. For any refund [which] that is not paid to the named insured within the specified period, the [person] party to whom the premium is owed shall be entitled to interest beginning on the first day after the expiration of the period, at the legal rate. Any interest developed because of late refunding shall ultimately benefit only the named insured. In cases where the amount of refund is in bona fide dispute, the refund shall not become due until the dispute is resolved. In cases where the final premium amount is subject to audit, the refund shall become due upon audit. In any event, return of the unearned premium shall be made within 90 days from the date of expiration or cancellation of the policy. This paragraph shall not apply to retrospectively rated policies.
248:4 Insurers Rehabilitation and Liquidation; Liability of Insurer; Reference Change. Amend the introductory paragraph of RSA 402-C:36 to read as follows:
The amount recoverable by the liquidator from a reinsurer shall not be reduced as a result of delinquency proceedings [unless] regardless of whether the reinsurance contract provides, in substance, that in the event of the insolvency of the ceding insurer, the reinsurance shall be payable by the assuming insurer on the basis of the claims allowed against the ceding insurer in the insolvency proceedings, under contract or contracts reinsured without diminution because of the insolvency of the ceding insurer. Such payments shall be made directly to the ceding insurer or to its domiciliary liquidator or receiver except:
248:5 Insurers Rehabilitation and Liquidation; Order of Distribution. Amend the introductory paragraph of RSA 402-C:44 to read as follows:
The order of distribution of claims from the insurer’s estate shall be as stated in this section. The first $50 of the amount allowed on each claim in the classes under paragraphs II, V, and VI except claims of the guaranty associations as defined in RSA 404-B, 404-H, 404-D, and 408-B shall be deducted from the claim. Claims may not be cumulated by assignment to avoid application of the $50 deductible provision. Subject to the $50 deductible provision, every claim in each class shall be paid in full or adequate funds retained for the payment before the members of the next class receive any payment. No subclasses shall be established within any class.
248:6 Producer Licensing; Reporting of Actions. Amend RSA 402-J:17 to read as follows:
402-J:17 Reporting of Actions.
I. A producer shall report to the commissioner any administrative action taken against the producer in another jurisdiction or by another governmental agency in this state within [15] 30 days of the final disposition of the matter. This report shall include a copy of the order, consent to order, or other relevant legal documents.
II. Within [15] 30 days of the initial pretrial hearing date, a producer shall report to the commissioner any criminal prosecution of the producer taken in any jurisdiction. The report shall include a copy of the initial complaint filed, the order resulting from the hearing, and any other relevant legal documents.
248:7 Standards for Accident and Health Insurance; Minimum Standards. Amend RSA 415-A:4-a, I(b)(1) to read as follows:
(1) Developed with input from appropriate [actively practicing] practitioners [in the licensed entity’s service area] with professional knowledge or clinical expertise in the area being reviewed;
248:8 Title Insurance Code; Filing of Forms; Reference Change. Amend RSA 416-A:17-a to read as follows:
416-A:17-a Filing of Forms. Every insurer and advisory organization shall file policy forms, endorsements, and other contract language covered by this chapter within 30 days of the effective date [of this section].
248:9 Managed Care Law; Grievance Procedures. Amend RSA 420-J:5, I(b) to read as follows:
(b) [The] For medical necessity appeals at least one person reviewing the [grievance on a first or second level appeal have appropriate medical and professional expertise and credentialing to competently render a determination on] appeal is a practitioner in the same or similar specialty who typically treats the medical condition, performs the procedure, or provides the treatment at issue in the appeal. A practitioner is considered of the same specialty if he or she has similar credentials and licensure as those who typically treat the condition or health problem in question in the appeal. A practitioner is considered of a similar specialty if he or she has experience treating the same problems as those in question in the appeal, in addition to expertise treating similar complications of those problems;
248:10 Managed Care Law; Grievance Procedures. Amend RSA 420-J:5, II(a) to read as follows:
(a) The review shall be conducted by or in consultation with a health care professional [who has appropriate training and experience in the field of medicine] in the same or similar specialty who typically treats the medical condition, performs the procedure, or provides the treatment at issue in the appeal. A practitioner is considered of the same specialty if he or she has similar credentials and licensure as those who typically treat the condition or health problem in question in the appeal. A practitioner is considered of a similar specialty if he or she has experience treating the same problems as those in question in the appeal, in addition to expertise treating similar complications of those problems;
248:11 New Paragraph; Property and Casualty Insurance; Monitoring Competition. Amend RSA 412:14 by inserting after paragraph II the following new paragraph:
III. For the purpose of carrying out the provisions of this section, the commissioner may, at any time, request information or data from insurers authorized to conduct business in this state that the commissioner believes relevant to monitoring and maintaining a competitive market.
248:12 Property and Casualty Insurance; Forms and Regulations. Amend RSA 412:28 and RSA 412:29 to read as follows:
412:28 Filing and Approval of Rates and Rating Plans.
I. Every [insurance company or other] insurer, [which] that insures employers against liability for compensation under the workers’ compensation law, RSA 281-A, shall file with the insurance commissioner individually or in collaboration with others, in such form as the commissioner may prescribe [its classification of risks and premium rates, together with basic rates and merit or debit and credit schedule rating, if a system of merit or debit and credit schedule rating is in use,] every manual, minimum premium, class rate, rating schedule, or rating plan and every other rating rule, and every modification of any of the foregoing that it proposes to use; provided, that none of [which] the above shall take effect until the commissioner shall have approved the same as [just and reasonable and adequate for the risks to which they respectively apply. The commissioner may require such insurer to furnish information to support such filing] adequate, not excessive, and not unfairly discriminatory.
II. An insurer shall file its rates by filing a multiplier, and, if applicable, other modifications to the prospective loss costs and rating plan filed by the National Council on Compensation Insurance or other authorized advisory organization on behalf of the insurer as permitted by RSA 412:23.
III. At the same time as a filing made pursuant to paragraphs I and II, every insurer shall file, or incorporate by reference any material that has been filed with and approved by the commissioner, all supplementary statistical and supporting information to be used as justification for this filing.
IV. The commissioner may evaluate systems of administered pricing versus competitive rating and the costs and benefits of applying such systems to regulating the classification of risks and premium rates for workers’ compensation insurance in New Hampshire. The commissioner may provide an evaluation to the workers’ compensation advisory council established by RSA 281-A:62.
412:29 Withdrawal of Approval. The commissioner may withdraw approval of any premium, rate, rating manual, or schedule [made] filed by any insurer according to RSA 412:28, if, in the commissioner’s judgment, such [premium rate or schedule is unjust, unreasonable, or inadequate to provide for the obligations assumed by the insurer] rate filing no longer results in premiums that are adequate, not excessive, or not unfairly discriminatory.
248:13 Special Notice Required. RSA 412:30 is repealed and reenacted to read as follows:
412:30 Special Notice Required. Any insured receiving a premium quote from an insurer, based on an approved rating plan, as described in RSA 412:28, that is higher than the premium that would be derived from the rates and rating plan approved for the assigned risk plan, shall be made aware by the insurer, in writing, that coverage may be obtained at a lower premium in the assigned risk plan.
248:14 Definition “Purchasing Alliance” Amended. Amend RSA 420-G:2, XIV-a to read as follows:
XIV-a. “Purchasing alliance” means a non-risk bearing corporation or other entity licensed pursuant to RSA 420-G:10-a that provides, on a voluntary basis, health insurance coverage through a single participating carrier or multiple unaffiliated participating carriers to member small employers and their employees within a defined service area authorized by the commissioner.
248:15 Exceptions to Rulemaking; Insurance. Amend RSA 541-A:21, VI to read as follows:
VI. Rules adopted under title XXXVII, relative to insurance regulation, shall be exempt from [the uniform system of numbering and drafting rules required by] RSA 541-A:7 and RSA 541-A:8[. These rules shall be in compliance with RSA 541-A:7] and shall permit the use of terminology allowing for discretionary authority by the commissioner if the wording is consistent with the language of [the] corresponding National Association of Insurance Commissioners [regulations] models.
248:16 Unauthorized Insurance. Amend RSA 406-B:16, VI(a) to read as follows:
(a) An insured who procures the insurance of any risk or risks other than life and annuity contracts and health insurance contracts by use of the services of a full time employee acting as an insurance manager or buyer or the services of a regularly and continuously retained qualified insurance consultant; and
248:17 Repeal. RSA 420-G:6, II-a, relative to individual health insurance, is repealed.
248:18 Repeal of Prospective Repeal. 2000, 2:3 and 4 relative to the repeal of RSA 420-G:2, XIV-a and RSA 420-G:10-a, and a contingency, are repealed.
248:19 Comprehensive Health Care System; Rulemaking. Amend RSA 420-G:11-a to read as follows:
420-G:11-a Development of a Comprehensive Health Care Information System.
I. The department and the department of health and human services shall enter into a memorandum of understanding for collaboration in the development of a comprehensive health care information system. The memorandum of understanding shall include a description of the data sets that will be included in the comprehensive health care information system, the criteria and procedures for the development of limited use data sets, the criteria and procedures to ensure that Health [Information Privacy] Insurance Portability and Accountability Act of 1996 (HIPAA) compliant limited use data sets are accessible, and a proposed time frame for the creation of a comprehensive health care information system. To the extent allowed by HIPAA, the data shall be available as a resource for insurers, employers, providers, purchasers of health care, and state agencies to continuously review health care utilization, expenditures, and performance in New Hampshire and to enhance the ability of New Hampshire consumers and employers to make informed and cost-effective health care choices. In presenting data for public access, comparative considerations shall be made regarding geography, demographics, general economic factors, and institutional size. Notwithstanding HIPAA or any other provision of law, the comprehensive health care information system shall not include or disclose any data that contains direct personal identifiers. For the purposes of this section, "direct personal identifiers" include information relating to an individual that contains primary or obvious identifiers, such as the individual’s name, street address, e-mail address, telephone number, and social security number.
II. The commissioner of the department of health and human services, with the approval of the commissioner of the insurance department, shall adopt rules, under RSA 541-A, as may be necessary to provide for the release of claims data from the comprehensive health care information system (CHIS).
248:20 Managed Care Law; Grievance Procedures. Amend RSA 420-J:5, V(e) to read as follows:
(e)(1) [In any case where] If a carrier or other licensed entity provides 2 mandatory levels of appeal, the first level shall be completed within 15 days and the second level completed within the 30-day time period beginning from the initial date of filing the appeal or grievance. If a carrier or other licensed entity provides a single mandatory level of appeal, the single mandatory level shall be completed within the 30-day time period beginning from the initial date of filing the appeal. With respect to a mandatory second level of appeal involving a claim for continuation of services or urgent care, the carrier or other licensed entity shall make a decision and notify the claimant within 72 hours after the mandatory second level appeal is filed. For appeals involving post service claims, the carrier shall make a decision and notify the claimant within 60 days of the date the completed appeal was filed.
(2) Subparagraph (e)(1) shall not prohibit a carrier or other licensed carrier from offering additional voluntary levels of appeal in addition to any mandatory levels of appeal offered, provided that:
(A) The claimant may elect to pursue any additional level of appeal under this subparagraph voluntarily;
(B) A carrier may not assert failure to exhaust administrative remedies where a claimant elects to pursue a claim through other venues rather than through the voluntary level of appeal;
(C) Any statute of limitations or time limits to pursue other remedies shall be tolled during the voluntary appeals process;
(D) Voluntary levels of appeal are available only after a claimant has completed required mandatory levels of appeal required under the plan or by regulation;
(E) The carrier provides a claimant with sufficient information to make an informed decision whether to submit the claim through any voluntary appeals process;
(F) No fees or costs are imposed on the claimant as part of any voluntary appeals process; and
(G) Any voluntary level of appeal requested by a claimant under this subparagraph shall be completed within 30 days from the date of the request for the voluntary appeal.
248:21 Managed Care Law; Right to External Review. Amend RSA 420-J:5-a, I(c) to read as follows:
(c)(1) The covered person or the covered person’s authorized representative has submitted the request for external review in writing to the commissioner within 180 days of the date of the carrier or other licensed entity’s [second level] denial decision provided pursuant to RSA 420-J:5, or if the carrier or other licensed entity has failed to make a first or second level, standard or expedited review decision that is past due, within 180 days of the date the decision was due;
(2) The covered person’s or covered person’s authorized representative’s participation in any voluntary level of appeal offered by a carrier or other licensed entity pursuant to RSA 420-J:5, V(e)(2) shall not affect a covered person’s ability to submit a request for external review. In the event that a covered person or covered person’s authorized representative elects to proceed with a voluntary appeal, that person shall have 180 days from the date the decision is rendered on the voluntary appeal to submit a request for external review.
248:22 Effective Date. This act shall take effect 60 days after its passage.
(Approved: July 14, 2005)
(Effective Date: September 12, 2005)