Md. Code Regs. 31.10.05.07

Current through Register Vol. 51, No. 22, November 1, 2024

Section 31.10.05.07 - Minimum Benefit Standards

A. A health insurance policy, contract, or certificate may not be advertised, marketed, solicited, or issued for delivery in this State as a Medicare supplement policy or as a Medigap policy unless it meets the following general and minimum standards and unless the insurer and its agents adhere to the requirements of the Maryland statutes and regulations regarding the sale of Medicare supplement policies. The minimum standards do not preclude the provision of additional benefits which are not inconsistent with these requirements and the use of other provisions which are more favorable to the insured or the policyholder. Whenever a policy is referred to in these regulations, it shall include a certificate.

B. General Standards.

(1) A Medicare supplement policy may not deny a claim for losses incurred more than 6 months after the effective date of coverage for a preexisting condition. The policy may not define a preexisting condition more restrictively than a condition for which medical advice was given or treatment was recommended by or received from a physician within 6 months before the effective date of coverage.

(2) A Medicare supplement policy may not provide benefits for losses resulting from sickness on a different basis than benefits provided for losses resulting from accidents.

(3) Automatic Changes to Correspond to Changes in Medicare.

(a) A Medicare supplement policy shall provide that benefits designed to cover deductibles or coinsurance amounts under Medicare will be changed automatically to coincide with any corresponding changes in the applicable Medicare deductible and copayment amounts.

(b) The insurer shall reserve the right to adjust premiums under the policy for the changes described in §B(3)(a) of this regulation.

(c) Proposed premium adjustments shall be submitted for approval by the Commissioner in accordance with the requirements of COMAR 31.10.01 and with other applicable regulations and statutes.

(4) Guaranteed Renewability.

(a) A Medicare supplement policy which provides coverage for an insured and spouse shall provide, except in the event of nonpayment of premium, continuation of coverage on the:

(i) Insured if coverage for the spouse is terminated; and

(ii) Spouse if coverage for the insured is terminated.

(b) Except in the event of nonpayment of premium, or as authorized by the Commissioner, an insurer may not cancel or nonrenew a Medicare supplement policy or certificate.

(5) Extension of Benefits.

(a) Termination of a Medicare supplement policy shall be without prejudice to any continuous loss which began while the policy was in force, but the extension of benefits beyond the period during which the policy was in force may be predicated upon the continuous total disability of the insured limited to the duration of the policy benefit period, if any, or payment of the maximum benefits.

(b) Receipt of Medicare Part D benefits may not be considered in determining a continuous loss.

(6) If a Medicare supplement policy eliminates an outpatient prescription drug benefit as a result of requirements imposed by the Medicare Prescription Drug, Improvement, and Modernization Act of 2003, the modified policy shall be deemed to satisfy the guaranteed renewal requirements of this regulation.

(7) Termination by a Group Policyholder.

(a) If a group Medicare supplement policy is terminated by the group policyholder and not replaced as provided in §B(9) of this regulation, the insurer shall offer certificate holders an individual Medicare supplement policy.

(b) The insurer shall offer the certificate holders described in §B(7)(a) of this regulation at least the following choices:

(i) An individual Medicare supplement policy which provides for continuation of the benefits contained in the group policy; and

(ii) An individual Medicare supplement policy which provides only those benefits which are required to meet the minimum standards of these regulations.

(8) If membership in a group is terminated, the insurer shall:

(a) Offer the certificate holder the conversion rights described in §B(7) of this regulation; or

(b) At the option of the group policyholder, offer the certificate holder continuation of coverage under the group policy.

(9) If a group Medicare supplement policy is replaced by another group Medicare supplement policy purchased by the same policyholder, the succeeding insurer shall offer coverage to all persons covered under the old group policy on its date of termination. Coverage under the new group policy may not result in any exclusion for preexisting conditions that would have been covered under the group policy being replaced.

C. Minimum Required Benefits.

(1) A Medicare supplement policy shall provide at least the following minimum benefits:

(a) Coverage of Medicare Part A eligible expenses for the initial Medicare deductible for hospitalization in any Medicare benefit period;

(b) Coverage of Medicare Part A eligible expenses for hospitalization to the extent not covered by Medicare for the 61st day through the 90th day in any Medicare benefit period;

(c) Coverage of Medicare Part A eligible expenses incurred as daily hospital charges to the extent not covered by Medicare during use of Medicare's lifetime hospital inpatient reserve days;

(d) Upon exhaustion of all Medicare inpatient hospital coverage, including the lifetime reserve days, coverage of 90 percent of all Medicare Part A eligible expenses for hospitalization not covered by Medicare subject to a lifetime maximum benefit of an additional 365 days;

(e) Coverage for the coinsurance amount of Medicare eligible expenses under Medicare Part B regardless of hospital confinement;

(f) Coverage under Medicare Part A for the reasonable cost of the first three pints of blood, or equivalent quantities of packed red blood cells as defined under federal regulations, in any calendar year unless replaced in accordance with federal regulations or already paid for under Medicare Part B;

(g) Coverage under Medicare Part B for the reasonable cost of the first three pints of blood, or equivalent quantities of packed red blood cells, as defined under federal regulations, in any calendar year unless replaced in accordance with federal regulations or already paid for under Part A, subject to the Medicare Part B deductible amount; and

(h) Coverage for up to $100 in each calendar year for an annual screening by low-dose mammography for the presence of occult breast cancer.

(2) Each insurer issuing a Medicare supplement policy shall include in the policy, or offer as an option, coverage of the initial annual deductible for Medicare eligible expenses under Medicare Part B.

(3) Payment of benefits by insurers for Medicare eligible expenses may be conditioned upon the same or less restrictive payment conditions, including determinations of medical necessity, as are applicable to medical claims.

D. An insurer shall restore any benefits which were eliminated from a Medicare supplement policy by operation of the Medicare Catastrophic Coverage Act of 1988.

E. A Medicare supplement policy shall provide for suspension of policy benefits and premiums for up to 24 months if the covered person is receiving benefits under Medicaid.

Md. Code Regs. 31.10.05.07

Regulations .07, Appendixes A_C adopted as an emergency provision effective July 1, 1982 (9:13 Md. R. 1340); adopted permanently effective October 1, 1982 (9:17 Md. R. 1707)
Regulations .07 and Appendices A_C repealed, and new Regulations .07 and Appendices A_C adopted as an emergency provision effective July 25, 1989 (16:16 Md. R. 1738); emergency status extended at 16:26 Md. R. 2782 and 17:5 Md. R. 633; emergency status expired July 20, 1990
Regulations .07 and Appendices A_C repealed, and new Regulations .07 adopted effective July 23, 1990 (17:14 Md. R. 1757)
Regulation .07E adopted effective November 11, 1991 (18:22 Md. R. 2396)
Regulation .07 amended effective January 1, 2006 (32:18 Md. R. 1522)