text:
(a) An issuer, directly or through its producers, shall do each of the following:

(1) Establish marketing procedures to ensure that any comparison of policies by its agents or other producers will be fair and accurate.

(2) Establish marketing procedures to ensure that excessive insurance is not sold or issued.

(3) Display prominently by type, stamp, or other appropriate means, on the first page of the policy, the following: “Notice to buyer: This policy may not cover all of your medical expenses.” (4) Inquire and otherwise make every reasonable effort to identify whether a prospective applicant for a Medicare supplement policy already has health insurance and the types and amounts of that insurance.

(5) Establish auditable procedures for verifying compliance with this subdivision.

(b) In addition to the practices prohibited by this code or any other law, the following acts and practices are prohibited:

(1) Twisting, which means knowingly making any misleading representation or incomplete or fraudulent comparison of any insurance policies or insurers for the purpose of inducing or tending to induce, any person to lapse, forfeit, surrender, terminate, retain, pledge, assign, borrow on, or convert an insurance policy or to take out a policy of insurance with another insurer.

(2) High pressure tactics, which means employing any method of marketing having the effect of or tending to induce the purchase of insurance through force, fright, threat, whether explicit or implied, or undue pressure to purchase or recommend the purchase of insurance.

(3) Cold lead advertising, which means making use directly or indirectly of any method of marketing that fails to disclose in a conspicuous manner that a purpose of the method of marketing is the solicitation of insurance and that contact will be made by an insurance agent or insurance company.

(c) The terms “Medicare supplement,” “Medigap,” “Medicare Wrap-Around” and words of similar import shall not be used unless the policy is issued in compliance with this article.

(d) The commissioner each year shall prepare a rate guide for Medicare supplement insurance and Medicare supplement contracts. The commissioner each year shall make the rate guide available on or before the date of the fall Medicare annual open enrollment. The rate guide shall include all of the following for each company that sells Medicare supplemental insurance or Medicare supplement contracts in California:

(1) (A) For policies sold for effective dates prior to June 1, 2010, a listing of all the policies, plans A to L, inclusive, that are available from the company.

(B) For policies sold for effective dates on or after June 1, 2010, a listing of all the policies, plans A to D, inclusive, F, high deductible F, G, and K to N, inclusive, that are available from the company.

(C) For policies sold or issued for effective dates on or after January 1, 2020, a listing of all the policies, plans A to D, inclusive, F, high deductible F, G, high deductible G, and K to N, inclusive, that are available from the company.

(2) (A) For policies sold for effective dates prior to June 1, 2010, a listing of all the policies, plans A to L, inclusive, for Medicare beneficiaries under 65 years of age that are available from the company.

(B) For policies sold for effective dates on or after June 1, 2010, a listing of all the policies, plans, A to D, inclusive, F, high deductible F, G, and K to N, inclusive, for Medicare beneficiaries under 65 years of age that are available from the company.

(C) For policies sold or issued for effective dates on or after January 1, 2020, a listing of all the policies, plans A to D, inclusive, F, high deductible F, G, high deductible G, and K to N, inclusive, for Medicare beneficiaries under 65 years of age that are available from the company.

(3) The toll-free telephone number of the company that consumers can use to obtain information from the company.

(4) Sample rates for each policy listed pursuant to paragraphs (1) and (2). The sample rates shall be for ages 0–65, 65, 70, 75, and 80.

(5) The premium rate methodology for each policy listed pursuant to paragraphs (1) and (2). “Premium rate methodology” means attained age, issue age, or community rated.

(6) The waiting period for preexisting conditions for each policy listed pursuant to paragraphs (1) and (2).

(e) The consumer rate guide prepared pursuant to subdivision (d) shall be distributed using all of the following methods:

(1) Through Health Insurance Counseling and Advocacy Program (HICAP) offices.

(2) By telephone, using the department’s consumer toll-free telephone number.

(3) On the department’s internet website.

(4) In addition to the distribution methods described in paragraphs (1) to (3), inclusive, each insurer that markets Medicare supplement insurance or Medicare supplement contracts in this state shall provide on the application form a statement that reads as follows: “A rate guide is available that compares the policies sold by different insurers. You can obtain a copy of this rate guide by calling the Department of Insurance’s consumer toll-free telephone number (1-800-927-HELP), by calling the Health Insurance Counseling and Advocacy Program (HICAP) toll-free telephone number (1-800-434-0222), or by accessing the Department of Insurance’s internet website (www.insurance.ca.gov).”

history: (History: Amended by Stats. 2019, Ch. 157, Sec. 8. (SB 784) Effective July 30, 2019.)

article: 6. Medicare Supplement Policies


kind: section

code: INS

text:
(a) In recommending the purchase or replacement of any Medicare supplement policy or certificate, an agent shall make reasonable efforts to determine the appropriateness of a recommended purchase or replacement.

(b) Any sale of a Medicare supplement policy or certificate that will provide an individual more than one Medicare supplement policy or certificate is prohibited.

(c) An issuer shall not issue a Medicare supplement policy or certificate to an individual enrolled in Medicare Part C unless the effective date of the coverage is after the termination date of the individual’s coverage under Medicare Part C.

history: (History: Amended by Stats. 2005, Ch. 206, Sec. 31. Effective January 1, 2006.)

division: 2. CLASSES OF INSURANCE

part: 2. LIFE AND DISABILITY INSURANCE

chapter: 1. The Contract

article: 6. Medicare Supplement Policies

path: 2. CLASSES OF INSURANCE > 2. LIFE AND DISABILITY INSURANCE > 1. The Contract > 6. Medicare Supplement Policies


text:
(a) On or before March 1 of each year, an issuer shall report the following information for every individual resident of this state for which the issuer has in force more than one Medicare supplement policy or certificate:

(1) Policy and certificate number.

(2) Date of issuance.

(b) The items set forth above must be grouped by individual policyholder.

history: (History: Added by Stats. 2000, Ch. 706, Sec. 4. Effective January 1, 2001.)

article: 6. Medicare Supplement Policies


text:
(a) If a Medicare supplement policy or certificate replaces another Medicare supplement policy or certificate, the replacing issuer shall waive any time periods applicable to preexisting conditions, waiting periods, elimination periods, and probationary periods in the new Medicare supplement policy or certificate for similar benefits to the extent that time was spent under the original policy.

(b) If a Medicare supplement policy or certificate replaces another Medicare supplement policy or certificate that has been in effect for at least six months, the replacing policy shall not provide any time period applicable to preexisting conditions, waiting periods, elimination periods and probationary periods for benefits similar to those contained in the original policy or certificate.

article: 6. Medicare Supplement Policies


text:
This section applies to all policies with policy years beginning on or after May 21, 2009.

(a) In addition to the requirements set forth under Sections 10140 and 10143, an issuer of a Medicare supplement policy or certificate shall adhere to the requirements imposed by the federal Genetic Information Nondiscrimination Act of 2008 (Public Law 110-233) as follows:

(1) The issuer shall not deny or condition the issuance or effectiveness of the policy or certificate, including the imposition of any exclusion of benefits under the policy based on a preexisting condition, on the basis of the genetic information with respect to that individual or a family member of the individual.

(2) The issuer shall not discriminate in the pricing of the policy or certificate, including the adjustment of premium rates, of an individual on the basis of the genetic information with respect to that individual or a family member of the individual.

(b) Nothing in subdivision (a) shall be construed to limit the ability of an issuer, to the extent otherwise permitted by law, to do either of the following:

(1) Deny or condition the issuance or effectiveness of the policy or certificate or increase the premium for a group based on the manifestation of a disease or disorder of an insured or applicant.

(2) Increase the premium for any policy issued to an individual based on the manifestation of a disease or disorder of an individual who is covered under the policy. For purposes of this paragraph, the manifestation of a disease or disorder in one individual shall not also be used as genetic information about other group members and to further increase the premium for the group.

(c) An issuer of a Medicare supplement policy or certificate shall not request or require an individual or a family member of that individual to undergo a genetic test.

(d) Subdivision (c) shall not be construed to preclude an issuer of a Medicare supplement policy or certificate from obtaining and using the results of a genetic test in making a determination regarding payment, as defined for the purposes of applying the regulations promulgated under Part C of Title XI and Section 264 of the Health Insurance Portability and Accountability Act of 1996, as may be revised from time to time, and consistent with subdivision (a).

(e) For purposes of carrying out subdivision (d), an issuer of a Medicare supplement policy or certificate may request only the minimum amount of information necessary to accomplish the intended purpose.

(f) An issuer of a Medicare supplement policy or certificate shall not request, require, seek, or purchase genetic information for underwriting purposes.

(g) An issuer of a Medicare supplement policy or certificate shall not request, require, seek, or purchase genetic information with respect to any individual or a family member of that individual prior to the individual’s enrollment under the policy in connection with that enrollment.

(h) If an issuer of a Medicare supplement policy or certificate obtains genetic information incidental to the requesting, requiring, or purchasing of other information concerning any individual or a family member of that individual, the request, requirement, or purchase shall not be considered a violation of subdivision (g) if the request, requirement, or purchase is not in violation of subdivision (f). However, the issuer shall not use any genetic information obtained under this section for any prohibited purpose described in this section or in Sections 10140 and 10143.

(i) For the purposes of this section, the following definitions shall apply:

(1) “Issuer of a Medicare supplement policy or certificate” includes a third-party administrator, or other person acting for or on behalf of an issuer.

(2) “Family member” means, with respect to an individual, any other individual who is a first-degree, second-degree, third-degree, or fourth-degree relative of the individual.

(3) “Genetic information” means, with respect to any individual, information about the individual’s genetic tests, the genetic tests of family members of the individual, and the manifestation of a disease or disorder in family members of the individual. The term includes, with respect to any individual, any request for, or receipt of, genetic services, or participation in clinical research that includes genetic services, by the individual or any family member of the individual. Any reference to genetic information concerning an individual or family member of an individual who is a pregnant woman includes genetic information of any fetus carried by that pregnant woman, or with respect to an individual or family member utilizing reproductive technology, includes genetic information of any embryo legally held by an individual or family member. The term “genetic information” does not include information about the sex or age of any individual.

(4) “Genetic services” means a genetic test, genetic education, or genetic counseling, including obtaining, interpreting, or assessing genetic information.

(5) “Genetic test” means an analysis of human DNA, RNA, chromosomes, proteins, or metabolites, that detect genotypes, mutations, or chromosomal changes. The term “genetic test” does not mean an analysis of proteins or metabolites that does not detect genotypes, mutations, or chromosomal changes; or an analysis of proteins or metabolites that is directly related to a manifested disease, disorder, or pathological condition that could reasonably be detected by a health care professional with appropriate training and expertise in the field of medicine involved.

(6) “Underwriting purposes” includes all of the following:

(A) Rules for, or determination of, eligibility, including enrollment and continued eligibility, for benefits under the policy.

(B) The computation of premium or contribution amounts under the policy.

(C) The application of any preexisting condition exclusion under the policy.

(D) Other activities related to the creation, renewal, or replacement of a policy of health insurance or health benefits.

history: (History: Added by Stats. 2009, Ch. 10, Sec. 27. Effective July 2, 2009.)

article: 6. Medicare Supplement Policies


text:
(a) With regard to Medicare supplement policies, all insurers, brokers, agents, and others engaged in the business of insurance owe a policyholder or a prospective policyholder a duty of honesty, and a duty of good faith and fair dealing.

(b) Conduct of an insurer, broker, or agent during the offer and sale of a Medicare supplement policy previous to the purchase is relevant to any action alleging a breach of the duty of honesty, and a duty of good faith and fair dealing set forth in subdivision (a).

history: (History: Amended by Stats. 2001, Ch. 328, Sec. 4. Effective January 1, 2002.)

article: 6. Medicare Supplement Policies


text:
The following standards are applicable to all Medicare supplement policies or certificates delivered or issued for delivery in this state with an effective date on or after June 1, 2010. No policy or certificate may be advertised, solicited, delivered, or issued for delivery in this state as a Medicare supplement policy or certificate unless it complies with these benefit standards. No issuer may offer any 1990 standardized Medicare supplement benefit plan for sale with an effective date on or after June 1, 2010. Benefit standards applicable to Medicare supplement policies and certificates issued with an effective date prior to June 1, 2010, remain subject to the requirements of Section 10192.8.

(a) The following general standards apply to Medicare supplement policies and certificates and are in addition to all other requirements of this article:

(1) A Medicare supplement policy or certificate shall not exclude or limit benefits for losses incurred more than six months from the effective date of coverage because it involved a preexisting condition. The policy or certificate shall 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 six months before the effective date of coverage.

(2) A Medicare supplement policy or certificate shall not indemnify against losses resulting from sickness on a different basis than losses resulting from accidents.

(3) A Medicare supplement policy or certificate shall provide that benefits designed to cover cost-sharing amounts under Medicare will be changed automatically to coincide with any changes in the applicable Medicare deductible, copayment, or coinsurance amounts. Premiums may be modified to correspond with those changes.

(4) A Medicare supplement policy or certificate shall not provide for termination of coverage of a spouse solely because of the occurrence of an event specified for termination of coverage of the insured, other than the nonpayment of premium.

(5) Each Medicare supplement policy shall be guaranteed renewable.

(A) The issuer shall not cancel or nonrenew the policy solely on the ground of health status of the individual.

(B) The issuer shall not cancel or nonrenew the policy for any reason other than nonpayment of premium or material misrepresentation which is shown by the issuer to be material to the acceptance for coverage. The contestability period for Medicare supplement insurance shall be two years, pursuant to Section 10350.2.

(C) If the Medicare supplement policy is terminated by the master policyholder and is not replaced as provided under subparagraph (E), the issuer shall offer certificate holders an individual Medicare supplement policy which, at the option of the certificate holder, does one of the following:

(i) Provides for continuation of the benefits contained in the group policy.

(ii) Provides for benefits that otherwise meet the requirements of one of the standardized policies defined in this article.

(D) If an individual is a certificate holder in a group Medicare supplement policy and the individual terminates membership in the group, the issuer shall do one of the following:

(i) Offer the certificate holder the conversion opportunity described in subparagraph (C).

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

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

(ii) If a Medicare supplement policy or certificate replaces another Medicare supplement policy or certificate that has been in force for six months or more, the replacing issuer shall not impose an exclusion or limitation based on a preexisting condition. If the original coverage has been in force for less than six months, the replacing issuer shall waive any time period applicable to preexisting conditions, waiting periods, elimination periods, or probationary periods in the new policy or certificate to the extent the time was spent under the original coverage.

(6) Termination of a Medicare supplement policy or certificate shall be without prejudice to any continuous loss that commenced 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. Receipt of Medicare Part D benefits shall not be considered in determining a continuous loss.

(7) (A) (i) A Medicare supplement policy or certificate shall provide that benefits and premiums under the policy or certificate shall be suspended at the request of the policyholder or certificate holder for the period, not to exceed 24 months, in which the policyholder or certificate holder has applied for and is determined to be entitled to medical assistance under Medi-Cal, but only if the policyholder or certificate holder notifies the issuer of the policy or certificate within 90 days after the date the individual becomes entitled to assistance. Upon receipt of timely notice, the insurer shall return directly to the insured that portion of the premium attributable to the period of Medi-Cal eligibility, subject to adjustment for paid claims.

(ii) If suspension occurs and if the policyholder or certificate holder loses entitlement to medical assistance under Medi-Cal, the policy or certificate shall be automatically reinstituted (effective as of the date of termination of entitlement) as of the termination of entitlement if the policyholder or certificate holder provides notice of loss of entitlement within 90 days after the date of loss and pays the premium attributable to the period, effective as of the date of termination of entitlement or equivalent coverage shall be provided if the prior form is no longer available.

(iii) Each Medicare supplement policy shall provide that benefits and premiums under the policy shall be suspended (for any period that may be provided by federal regulation) at the request of the policyholder if the policyholder is entitled to benefits under Section 226(b) of the federal Social Security Act and is covered under a group health plan (as defined in Section 1862(b)(1)(A)(v) of the federal Social Security Act). If suspension occurs and if the policyholder or certificate holder loses coverage under the group health plan, the policy shall be automatically reinstituted (effective as of the date of loss of coverage) if the policyholder provides notice of loss of coverage within 90 days after the date of the loss and pays the applicable premium.

(B) Reinstitution of coverages shall comply with all of the following requirements:

(i) Not provide for any waiting period with respect to treatment of preexisting conditions.

(ii) Provide for resumption of coverage that is substantially equivalent to coverage in effect before the date of suspension.

(iii) Provide for classification of premiums on terms at least as favorable to the policyholder or certificate holder as the premium classification terms that would have applied to the policyholder or certificate holder had the coverage not been suspended.

(8) A Medicare supplement policy shall not limit coverage exclusively to a single disease or affliction.

(9) A Medicare supplement policy shall provide an examination period of 30 days after the receipt of the policy by the applicant for purposes of review, during which time the applicant may return the policy as described in subdivision (e) of Section 10192.17.

(b) With respect to the standards for basic (core) benefits for benefit plans A, B, C, D, F, high deductible F, G, M, and N, every issuer of Medicare supplement insurance benefit plans shall make available a policy or certificate including only the following basic “core” package of benefits to each prospective insured. An issuer may make available to prospective insureds any of the other Medicare Supplement Insurance Benefit Plans in addition to the basic (core) package, but not in lieu of it. However, the benefits described in paragraphs (7) and (8) shall not be offered so long as California is required to disallow these benefits for Medicare beneficiaries by the Centers for Medicare and Medicaid Services or other agent of the federal government under Section 1395ss of Title 42 of the United States Code.

(1) Coverage of Part A Medicare eligible expenses for hospitalization to the extent not covered by Medicare from the 61st day through the 90th day, inclusive, in any Medicare benefit period.

(2) Coverage of Part A Medicare eligible expenses incurred for hospitalization to the extent not covered by Medicare for each Medicare lifetime inpatient reserve day used.

(3) Upon exhaustion of the Medicare hospital inpatient coverage, including the lifetime reserve days, coverage of 100 percent of the Medicare Part A eligible expenses for hospitalization paid at the applicable prospective payment system (PPS) rate, or other appropriate Medicare standard of payment, subject to a lifetime maximum benefit of an additional 365 days. The provider shall accept the issuer’s payment as payment in full and may not bill the insured for any balance.

(4) Coverage under Medicare Parts A and 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, unless replaced in accordance with federal regulations.

(5) Coverage for the coinsurance amount, or in the case of hospital outpatient department services paid under a prospective payment system, the copayment amount, of Medicare eligible expenses under Part B regardless of hospital confinement, subject to the Medicare Part B deductible.

(6) Coverage of cost sharing for all Part A Medicare eligible hospice care and respite care expenses.

(7) Coverage of the actual cost, up to the legally billed amount, of an annual mammogram as provided in Section 10123.81, to the extent not paid by Medicare.

(8) Coverage of the actual cost, up to the legally billed amount, of an annual cervical cancer screening test as provided in Section 10123.18, to the extent not paid by Medicare.

(c) The following additional benefits shall be included in Medicare supplement benefit plans B, C, D, F, high deductible F, G, M, and N, consistent with the plan type and benefits for each plan as provided in Section 10192.91:

(1) With respect to the Medicare Part A deductible, coverage for 100 percent of the Medicare Part A inpatient hospital deductible amount per benefit period.

(2) With respect to the Medicare Part A deductible, coverage for 50 percent of the Medicare Part A inpatient hospital deductible amount per benefit period.

(3) With respect to skilled nursing facility care, coverage for the actual billed charges up to the coinsurance amount from the 21st day through the 100th day in a Medicare benefit period for posthospital skilled nursing facility care eligible under Medicare Part A.

(4) With respect to the Medicare Part B deductible, coverage for 100 percent of the Medicare Part B deductible amount per calendar year regardless of hospital confinement.

(5) With respect to 100 percent of the Medicare Part B excess charges, coverage for all of the difference between the actual Medicare Part B charges as billed, not to exceed any charge limitation established by the Medicare Program or state law, and the Medicare-approved Part B charge.

(6) With respect to medically necessary emergency care in a foreign country, coverage to the extent not covered by Medicare for 80 percent of the billed charges for Medicare-eligible expenses for medically necessary emergency hospital, physician, and medical care received in a foreign country, which care would have been covered by Medicare if provided in the United States and which care began during the first 60 consecutive days of each trip outside the United States, subject to a calendar year deductible of two hundred fifty dollars ($250), and a lifetime maximum benefit of fifty thousand dollars ($50,000). For purposes of this benefit, “emergency care” shall mean care needed immediately because of an injury or an illness of sudden and unexpected onset.

history: (History: Amended by Stats. 2010, Ch. 328, Sec. 146. (SB 1330) Effective January 1, 2011.)

article: 6. Medicare Supplement Policies


text:
The following standards are applicable to all Medicare supplement policies or certificates delivered or issued for delivery in this state with an effective date on or after June 1, 2010. No policy or certificate may be advertised, solicited, delivered, or issued for delivery in this state as a Medicare supplement policy or certificate unless it complies with these benefit plan standards. Benefit plan standards applicable to Medicare supplement policies and certificates issued with an effective date before June 1, 2010, remain subject to the requirements of Section 10192.9.

(a) (1) An issuer shall make available to each prospective policyholder and certificate holder a policy form or certificate form containing only the basic (core) benefits, as defined in subdivision (b) of Section 10192.81.

(2) If an issuer makes available any of the additional benefits described in subdivision (c) of Section 10192.81, or offers standardized benefit plan K or L, as described in paragraphs (8) and (9) of subdivision (e), then the issuer shall make available to each prospective policyholder and certificate holder, in addition to a policy form or certificate form with only the basic core benefits as described in paragraph (1), a policy form or certificate form containing either standardized benefit plan C, as described in paragraph (3) of subdivision (e), or standardized benefit plan F, as described in paragraph (5) of subdivision (e).

(b) No groups, packages, or combinations of Medicare supplement benefits other than those listed in this section shall be offered for sale in this state, except as may be permitted in subdivision (f) and by Section 10192.10.

(c) Benefit plans shall be uniform in structure, language, designation, and format to the standard benefit plans listed in subdivision (e) and conform to the definitions in Section 10192.4. Each benefit shall be structured in accordance with the format provided in subdivisions (b) and (c) of Section 10192.81; or, in the case of plan K or L, in paragraph (8) or (9) of subdivision (e) and list the benefits in the order shown in subdivision (e). For purposes of this section, “structure, language, and format” means style, arrangement, and overall content of a benefit.

(d) In addition to the benefit plan designations required in subdivision (c), an issuer may use other designations to the extent permitted by law.

(e) With respect to the makeup of 2010 standardized benefit plans, the following shall apply:

(1) Standardized Medicare supplement benefit plan A shall include only the basic (core) benefits as defined in subdivision (b) of Section 10192.81.

(2) Standardized Medicare supplement benefit plan B shall include only the following: the basic (core) benefit as defined in subdivision (b) of Section 10192.81, plus 100 percent of the Medicare Part A deductible as defined in paragraph (1) of subdivision (c) of Section 10192.81.

(3) Standardized Medicare supplement benefit plan C shall include only the following: the basic (core) benefit as defined in subdivision (b) of Section 10192.81, plus 100 percent of the Medicare Part A deductible, skilled nursing facility care, 100 percent of the Medicare Part B deductible, and medically necessary emergency care in a foreign country, as defined in paragraphs (1), (3), (4), and (6) of subdivision (c) of Section 10192.81, respectively.

(4) Standardized Medicare supplement benefit plan D shall include only the following: the basic (core) benefit, as defined in subdivision (b) of Section 10192.81, plus 100 percent of the Medicare Part A deductible, skilled nursing facility care, and medically necessary emergency care in a foreign country, as defined in paragraphs (1), (3), and (6) of subdivision (c) of Section 10192.81, respectively.

(5) Standardized Medicare supplement benefit plan F shall include only the following: the basic (core) benefit as defined in subdivision (b) of Section 10192.81, plus 100 percent of the Medicare Part A deductible, the skilled nursing facility care, 100 percent of the Medicare Part B deductible, 100 percent of the Medicare Part B excess charges, and medically necessary emergency care in a foreign country as defined in paragraphs (1), (3), (4), (5), and (6) of subdivision (c) of Section 10192.81, respectively.

(6) Standardized Medicare supplement benefit high deductible plan F shall include only the following: 100 percent of covered expenses following the payment of the annual deductible set forth in subparagraph (B).

(A) The covered expenses include the basic (core) benefit as defined in subdivision (b) of Section 10192.81, plus 100 percent of the Medicare Part A deductible, skilled nursing facility care, 100 percent of the Medicare Part B deductible, 100 percent of the Medicare Part B excess charges, and medically necessary emergency care in a foreign country, as defined in paragraphs (1), (3), (4), (5), and (6) of subdivision (c) of Section 10192.81, respectively.

(B) The annual deductible in high deductible plan F shall consist of out-of-pocket expenses, other than premiums, for services covered by plan F, and shall be in addition to any other specific benefit deductibles. The basis for the deductible shall be one thousand five hundred dollars ($1,500) and shall be adjusted annually from 1999 by the Secretary of the United States Department of Health and Human Services to reflect the change in the Consumer Price Index for all urban consumers for the 12-month period ending with August of the preceding year, and rounded to the nearest multiple of ten dollars ($10).

(7) (A) Standardized Medicare supplement benefit plan G shall include only the following: the basic (core) benefit as defined in subdivision (b) of Section 10192.81, plus 100 percent of the Medicare Part A deductible, skilled nursing facility care, 100 percent of the Medicare Part B excess charges, and medically necessary emergency care in a foreign country, as defined in paragraphs (1), (3), (5), and (6) of subdivision (c) of Section 10192.81, respectively.

(B) Effective January 1, 2020, the standardized benefit plans described in paragraph (4) of subdivision (a) of Section 10192.92 (redesignated high deductible plan G) may be offered to any individual who was eligible for Medicare prior to January 1, 2020.

(8) Standardized Medicare supplement benefit plan K shall include only the following:

(A) Coverage of 100 percent of the Part A hospital coinsurance amount for each day used from the 61st through the 90th day in any Medicare benefit period.

(B) Coverage of 100 percent of the Part A hospital coinsurance amount for each Medicare lifetime inpatient reserve day used from the 91st through the 150th day in any Medicare benefit period.

(C) Upon exhaustion of the Medicare hospital inpatient coverage, including the lifetime reserve days, coverage of 100 percent of the Medicare Part A eligible expenses for hospitalization paid at the applicable prospective payment system (PPS) rate, or other appropriate Medicare standard of payment, subject to a lifetime maximum benefit of an additional 365 days. The provider shall accept the issuer’s payment as payment in full and may not bill the insured for any balance.

(D) Coverage for 50 percent of the Medicare Part A inpatient hospital deductible amount per benefit period until the out-of-pocket limitation is met as described in subparagraph (J).

(E) Coverage for 50 percent of the coinsurance amount for each day used from the 21st day through the 100th day in a Medicare benefit period for posthospital skilled nursing facility care eligible under Medicare Part A until the out-of-pocket limitation is met as described in subparagraph (J).

(F) Coverage for 50 percent of cost sharing for all Part A Medicare eligible expenses and respite care until the out-of-pocket limitation is met as described in subparagraph (J).

(G) Coverage for 50 percent, under Medicare Part A or B, of the reasonable cost of the first three pints of blood, or equivalent quantities of packed red blood cells, as defined under federal regulations, unless replaced in accordance with federal regulations until the out-of-pocket limitation is met as described in subparagraph (J).

(H) Except for coverage provided in subparagraph (I), coverage for 50 percent of the cost sharing otherwise applicable under Medicare Part B after the policyholder pays the Part B deductible until the out-of-pocket limitation is met as described in subparagraph (J).

(I) Coverage of 100 percent of the cost sharing for Medicare Part B preventive services after the policyholder pays the Part B deductible.

(J) Coverage of 100 percent of all cost sharing under Medicare Parts A and B for the balance of the calendar year after the individual has reached the out-of-pocket limitation on annual expenditures under Medicare Parts A and B of four thousand dollars ($4,000) in 2006, indexed each year by the appropriate inflation adjustment specified by the Secretary of the United States Department of Health and Human Services.

(9) Standardized Medicare supplement benefit plan L shall include only the following:

(A) The benefits described in subparagraphs (A), (B), (C), and (I) of paragraph (8).

(B) The benefit described in subparagraphs (D), (E), (F), (G), and (H) of paragraph (8), but substituting 75 percent for 50 percent.

(C) The benefit described in subparagraph (J) of paragraph (8), but substituting two thousand dollars ($2,000) for four thousand dollars ($4,000).

(10) Standardized Medicare supplement benefit plan M shall include only the following: the basic (core) benefit as defined in subdivision (b) of Section 10192.81, plus 50 percent of the Medicare Part A deductible, skilled nursing facility care, and medically necessary emergency care in a foreign country, as defined in paragraphs (2), (3), and (6) of subdivision (c) of Section 10192.81, respectively.

(11) Standardized Medicare supplement benefit plan N shall include only the following: the basic (core) benefit as defined in subdivision (b) of Section 10192.81, plus 100 percent of the Medicare Part A deductible, skilled nursing facility care, and medically necessary emergency care in a foreign country, as defined in paragraphs (1), (3), and (6) of subdivision (c) of Section 10192.81, respectively, with copayments in the following amounts:

(A) The lesser of twenty dollars ($20) or the Medicare Part B coinsurance or copayment for each covered health care provider office visit, including visits to medical specialists.

(B) The lesser of fifty dollars ($50) or the Medicare Part B coinsurance or copayment for each covered emergency room visit; however, this copayment shall be waived if the insured is admitted to any hospital and the emergency visit is subsequently covered as a Medicare Part A expense.

(f) (1) (A) An issuer may, with the prior approval of the commissioner, offer policies or certificates with new or innovative benefits, in addition to the standardized benefits provided in a policy or certificate that otherwise complies with the applicable standards. The new or innovative benefits shall include only benefits that are appropriate to Medicare supplement insurance, are new or innovative, are not otherwise available, and are cost effective. Approval of new or innovative benefits shall not adversely impact the goal of Medicare supplement simplification.

(B) New or innovative benefits shall exclude an outpatient prescription drug benefit. New or innovative benefits shall not be used to change or reduce benefits, including a change of any cost-sharing provision, in any standardized plan.

(C) Commencing July 1, 2020, the portion of the premium attributed to the new or innovative benefits shall be identified as a separate line item on the payment invoice or bill.

(2) In the interest of full and fair disclosure, and to ensure the availability of necessary consumer information to current and prospective policyholders and certificate holders, for purposes of implementing this paragraph, the department shall collaborate with the Department of Managed Health Care, consumer group representatives, and issuers to develop and implement policies and procedures, as necessary, including, but not limited to, all of the following:

(A) The development and dissemination of information and material about any new or innovative benefits approved for sale.

(B) The revision of materials described in Sections 10192.15 and 10192.18 of this code, and Sections 1358.15 and 1358.18 of the Health and Safety Code, as may be necessary.

(C) The standardization of new or innovative benefits, as appropriate, for purposes of allowing consumer comparison of benefits, out-of-pocket costs, and premiums.

(3) On or before July 1, 2020, the commissioner may issue guidance to issuers regarding compliance with this section and that guidance shall not be subject to the Administrative Procedure Act (Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code). Any guidance issued pursuant to this subdivision shall be effective only through December 31, 2022, or until the commissioner adopts and effects regulations pursuant to the Administrative Procedure Act, whichever occurs first.

history: (History: Amended (as amended by Stats. 2019, Ch. 157, Sec. 4) by Stats. 2019, Ch. 549, Sec. 3. (SB 407) Effective January 1, 2020.)

article: 6. Medicare Supplement Policies


text:
The following standards are applicable to all Medicare supplement policies or certificates delivered or issued for delivery in this state to individuals newly eligible for Medicare on or after January 1, 2020. A policy or certificate that provides coverage of the Medicare Part B deductible shall not be advertised, solicited, delivered, or issued for delivery in the state as a Medicare supplement policy or certificate to individuals newly eligible for Medicare on or after January 1, 2020. All policies must comply with the following benefit standards. Benefit plan standards applicable to Medicare supplement policies and certificates issued to individuals eligible for Medicare before January 1, 2020, remain subject to the requirements of Section 10192.91 or 10192.9, as applicable.

(a) The standards and requirements of Section 10192.91 apply to all Medicare supplement policies delivered or issued for delivery to individuals newly eligible for Medicare on or after January 1, 2020, with the following exceptions:

(1) Standardized Medicare supplement benefit plan C is redesignated as plan D and shall provide the benefits described in paragraph (3) of subdivision (e) of Section 10192.91 but shall not provide coverage for 100 percent, or any portion, of the Medicare Part B deductible.

(2) Standardized Medicare supplement benefit plan F is redesignated as plan G and shall provide the benefits described in paragraph (5) of subdivision (e) of Section 10192.91, but shall not provide coverage for 100 percent, or any portion, of the Medicare Part B deductible.

(3) Standardized Medicare supplement benefit plans C, F, and high deductible plan F may not be offered to individuals newly eligible for Medicare on or after January 1, 2020.

(4) Standardized Medicare supplement benefit high deductible plan F is redesignated as high deductible plan G and shall provide the benefits described for standardized Medicare supplement benefit high deductible plan F in paragraph (6) of subdivision (e) of Section 10192.91, but shall not provide coverage for 100 percent, or any portion, of the Medicare Part B deductible. The Medicare Part B deductible paid by the beneficiary shall be considered an out-of-pocket expense in meeting the annual deductible under high deductible plan G.

(5) The reference to standardized Medicare supplement benefit plan C or F in paragraph (2) of subdivision (a) of Section 10192.91 shall, for purposes of this section, be deemed a reference to standardized Medicare supplement benefit plan D or G, respectively.

(b) This section applies only to individuals who are newly eligible for Medicare on or after January 1, 2020. For purposes of this section, “newly eligible Medicare beneficiary” means an individual who satisfies one of the following:

(1) The individual has attained 65 years of age on or after January 1, 2020.

(2) The individual is entitled to benefits under Medicare Part A pursuant to Section 226(b) or 226A of the federal Social Security Act, or is deemed eligible for benefits under Section 226(a) of the federal Social Security Act, on or after January 1, 2020.

(c) For purposes of subdivision (e) of Section 10192.12, in the case of an individual newly eligible for Medicare on or after January 1, 2020, any reference to standardized Medicare supplement benefit plan C, plan F, or high deductible plan F shall be deemed to be a reference to standardized Medicare supplement benefit plan D, plan G, or high deductible plan G, respectively, that meet the requirements of subdivision (a).

(d) On or after January 1, 2020, the standardized Medicare supplement benefit plans described in paragraph (4) of subdivision (a) may be offered to any individual who was eligible for Medicare prior to January 1, 2020, in addition to the standardized Medicare supplement benefit plans described in subdivision (e) of Section 10192.91.

history: (History: Amended by Stats. 2020, Ch. 370, Sec. 220. (SB 1371) Effective January 1, 2021.)

article: 6. Medicare Supplement Policies


text:
(a) (1) As prescribed in this chapter, the commissioner shall have the administrative authority to assess penalties against issuers, brokers, agents, and other entities engaged in the business of insurance or any other person or entity for violations of this article.

(2) Upon a showing of a violation of this article in any civil action, a court may also assess the penalties prescribed in this chapter.

(3) Whenever the commissioner has reasonable cause to believe or determines after a public hearing that any issuer, agent, broker, or other person or entity engaged in the business of insurance, has violated this article he or she shall make and serve upon the issuer, broker, or other person or entity a notice of hearing. The notice shall state the commissioner’s intent to assess the administrative penalties, the time and place of the hearing, and the conduct, condition, or ground upon which the commissioner is holding the hearing and assessing the penalties. The hearing shall occur within 30 days after the notice is served. Within 30 days after the hearing the commissioner shall issue an order specifying the amount of penalties to be paid. The penalties resulting from the hearing shall be paid to the Insurance Fund.

(4) The powers vested in the commissioner by this section shall be additional to any and all powers and remedies vested in the commissioner by law.

(b) (1) Any broker, agent, or other person or entity engaged in the business of insurance, other than an issuer, who violates this article is liable for administrative penalties of no less than two hundred fifty dollars ($250) for the first violation.

(2) Any broker, agent, other person, or other entity engaged in the business of insurance, other than an issuer, who engages in practices prohibited by this chapter a second or subsequent time or who commits a knowing violation of this article, is liable for administrative penalties of no less than one thousand dollars ($1,000) and no more than twenty-five thousand dollars ($25,000) for each violation.

(3) Any issuer who violates this article is liable for administrative penalties of no less than two thousand five hundred dollars ($2,500) for the first violation.

(4) Any issuer who violates this article with a frequency as to indicate a general business practice or commits a knowing violation of this article, is liable for administrative penalties of no less than ten thousand dollars ($10,000) and no more than one hundred thousand dollars ($100,000) for each violation.

(c) (1) Actions for injunctive relief, penalties in the amounts specified in subdivision (a), damages, restitution, and all other remedies provided for in law, may be brought in superior court by the Attorney General, district attorney, or city attorney on behalf of the people of the State of California.

(2) The court shall award reasonable attorney’s fees and costs to a prevailing plaintiff who establishes a violation of this article.

(d) In addition to any other applicable penalties, the commissioner may require issuers, agents, brokers, or other persons or entities violating any provision of this article or regulations promulgated pursuant to this article, to cease marketing in this state any Medicare supplement policy or certificate or may require the issuer, agent, broker, or other person or entity to take such actions as are necessary to comply with the provisions of this article, or both.

(e) Any person who knowingly or intentionally violates any provision of this article is guilty of a public offense punishable by imprisonment in a county jail not exceeding one year, or by imprisonment pursuant to subdivision (h) of Section 1170 of the Penal Code, or by a fine not exceeding ten thousand dollars ($10,000), or by both that imprisonment and fine.

(f) (1) The requirements and remedies provided by this article are in addition to any other remedies provided by law.

(2) If any provision of this article or the application thereof to any person or circumstances is held invalid, that invalidity shall not affect other provisions or applications of the article which can be given effect without the invalid provision or application, and to this end the provisions of this article are severable.

history: (History: Amended by Stats. 2011, Ch. 15, Sec. 213. (AB 109) Effective April 4, 2011. Operative October 1, 2011, by Sec. 636 of Ch. 15, as amended by Stats. 2011, Ch. 39, Sec. 68.)

article: 6. Medicare Supplement Policies


text:
In addition to any other requirements of law, the following shall apply to a Medicare supplement policy:

(a) The issuer shall not require an amount greater than one month’s premium to be submitted with an application for the policy of insurance if interim coverage is not provided. If interim coverage is provided, the issuer shall not require an amount greater than two months’ premium for that purpose. No further premiums may be collected until the policy is delivered to the applicant.

(b) The issuer shall notify the applicant within 60 days from the date the issuer or issuer’s authorized representative or producer receives the application and the amount as to whether or not the applicant will be issued a policy of insurance. If the applicant is not so notified, the issuer or issuer’s authorized representative or producer shall pay interest to the applicant on the funds that the applicant submitted with the application, at the legal rate of interest on judgments as provided in Section 685.010 of the Code of Civil Procedure, from the date the issuer or issuer’s authorized representative or producer received those funds until they are refunded to the applicant or are applied toward the premium.

article: 6. Medicare Supplement Policies


text: The commissioner may prescribe by regulation a standard form and the contents of an informational brochure for persons eligible for Medicare by reason of age which is intended to improve the buyer’s ability to select the most appropriate coverage and improve the buyer’s understanding of Medicare. Except in the case of direct response insurance policies, the commissioner may require by regulation that the information brochure be provided to any applicant eligible for Medicare concurrently with delivery of the outline of coverage. With respect to direct response insurance policies, the commissioner may require by regulation that the prescribed brochure be provided upon request to any applicant eligible for Medicare by reason of age, but in no event later than the time of policy delivery.

article: 6. Medicare Supplement Policies


text:
For purposes of this article, the following definitions shall apply:

(a) “Health benefit plan” means any group or individual policy of health insurance, as defined in Section 106. The term does not include coverage of Medicare services pursuant to contracts with the United States government or coverage that provides excepted benefits as described in Sections 2722 and 2791 of the federal Public Health Service Act, subject to Section 10198.61.

(b) “Preexisting condition provision” means a policy provision that excludes coverage for charges or expenses incurred during a specified period following the insured’s effective date of coverage, as to a condition for which medical advice, diagnosis, care, or treatment was recommended or received during a specified period immediately preceding the effective date of coverage.

(c) “Creditable coverage” means:

(1) Any individual or group policy, contract, or program, that is written or administered by a health insurer, health care service plan, fraternal benefits society, self-insured employer plan, or any other entity, in this state or elsewhere, and that arranges or provides medical, hospital, and surgical coverage not designed to supplement other private or governmental plans. The term includes continuation or conversion coverage but does not include accident only, credit, coverage for onsite medical clinics, disability income, Medicare supplement, long-term care insurance, dental, vision, coverage issued as a supplement to liability insurance, insurance arising out of a workers’ compensation or similar law, automobile medical payment insurance, or insurance under which benefits are payable with or without regard to fault and that is statutorily required to be contained in any liability insurance policy or equivalent self-insurance.

(2) The federal Medicare Program pursuant to Title XVIII of the federal Social Security Act (42 U.S.C. Sec. 1395 et seq.).

(3) The Medicaid Program pursuant to Title XIX of the federal Social Security Act (42 U.S.C. Sec. 1396 et seq.).

(4) Any other publicly sponsored program, provided in this state or elsewhere, of medical, hospital, and surgical care.

(5) 10 U.S.C. Chapter 55 (commencing with Section 1071) (Civilian Health and Medical Program of the Uniformed Services (CHAMPUS)).

(6) A medical care program of the Indian Health Service or of a tribal organization.

(7) A health plan offered under 5 U.S.C. Chapter 89 (commencing with Section 8901) (Federal Employees Health Benefits Program (FEHBP)).

(8) A public health plan as defined in federal regulations authorized by Section 2701(c)(1)(I) of the federal Public Health Service Act, as amended by Public Law 104-191, the federal Health Insurance Portability and Accountability Act of 1996.

(9) A health benefit plan under Section 5(e) of the federal Peace Corps Act (22 U.S.C. Sec. 2504(e)).

(10) Any other creditable coverage as defined by subsection (c) of Section 2704 of Title XXVII of the federal Public Health Service Act (42 U.S.C. Sec. 300gg-3(c)).

(d) “Waivered condition provision” means a contract provision that excludes coverage for charges or expenses incurred during a specified period of time for one or more specific, identified, medical conditions.

(e) “Grandfathered health benefit plan” means a health benefit plan that is a grandfathered health plan, as defined in Section 1251 of PPACA.

(f) “Nongrandfathered health benefit plan” means a health benefit plan that is not a grandfathered health plan as defined in Section 1251 of PPACA.

(g) “PPACA” means the federal Patient Protection and Affordable Care Act (Public Law 111-148), as amended by the federal Health Care and Education Reconciliation Act of 2010 (Public Law 111-152), and any rules, regulations, or guidance issued pursuant to that law.

history: (History: Repealed (in Sec. 12) and added by Stats. 2012, Ch. 852, Sec. 11. (AB 1083) Effective January 1, 2013. Section operative January 1, 2014, pursuant to Section 10198.10.)

article: 7. Preexisting Condition Provisions

path: 2. CLASSES OF INSURANCE > 2. LIFE AND DISABILITY INSURANCE > 1. The Contract > 7. Preexisting Condition Provisions


text:
(a) A health benefit plan for group coverage shall not impose any preexisting condition provision or waivered condition provision upon any individual.

(b) (1) A nongrandfathered health benefit plan for individual coverage shall not impose any preexisting condition provision or waivered condition provision upon any individual.

(2) A grandfathered health benefit plan for individual coverage shall not exclude coverage on the basis of a waivered condition provision or preexisting condition provision for a period greater than 12 months following the individual’s effective date of coverage, nor limit or exclude coverage for a specific insured by type of illness, treatment, medical condition, or accident, except for satisfaction of a preexisting condition provision or waivered condition provision pursuant to this article. Waivered condition provisions or preexisting condition provisions contained in individual grandfathered health benefit plans may relate only to conditions for which medical advice, diagnosis, care, or treatment, including use of prescription drugs, was recommended or received from a licensed health practitioner during the 12 months immediately preceding the effective date of coverage.

(3) In determining whether a preexisting condition provision or a waivered condition provision applies to an individual under this subdivision, a health benefit plan shall credit the time the individual was covered under creditable coverage, provided that the individual becomes eligible for coverage under the succeeding health benefit plan within 62 days of termination of prior coverage and applies for coverage under the succeeding plan within the applicable enrollment period.

(c) A health benefit plan for group or individual coverage shall not impose a waiting period.

history: (History: Amended by Stats. 2021, Ch. 764, Sec. 8. (SB 326) Effective January 1, 2022.)

article: 7. Preexisting Condition Provisions


text: This article applies to all health benefit plans that provide benefits to residents of this state regardless of the situs of the contract or group master policyholder.

article: 7. Preexisting Condition Provisions


text:
A health benefit plan for group coverage shall not establish rules for eligibility, including continued eligibility, of an individual, or dependent of an individual, to enroll under the terms of the plan based on any of the following health status-related factors:

(a) Health status.

(b) Medical condition, including physical and mental illnesses.

(c) Claims experience.

(d) Receipt of health care.

(e) Medical history.

(f) Genetic information.

(g) Evidence of insurability, including conditions arising out of acts of domestic violence.

(h) Disability.

(i) Any other health status-related factor as determined by any federal regulations, rules, or guidance issued pursuant to Section 2705 of the federal Public Health Service Act.

article: 7. Preexisting Condition Provisions


text: This article shall become operative on January 1, 2014.

history: (History: Repealed (in Sec. 12) and added by Stats. 2012, Ch. 852, Sec. 11. (AB 1083) Effective January 1, 2013. Note: This section prescribes a delayed operative date (Jan. 1, 2014) for Article 7, commencing with Section 10198.6.)

article: 7. Preexisting Condition Provisions


text:
(a) For purposes of this article, “health benefit plan” does not include policies or certificates of specified disease or hospital confinement indemnity provided that the carrier offering those policies or certificates complies with the following:

(1) The carrier files, on or before March 1 of each year, a certification with the commissioner that contains the statement and information described in paragraph (2).

(2) The certification required in paragraph (1) shall contain the following:

(A) A statement from the carrier certifying that policies or certificates described in this section (i) are being offered and marketed as supplemental health insurance and not as a substitute for coverage that provides essential health benefits as defined by the state pursuant to Section 1302 of PPACA, and (ii) the disclosure form as described in Section 10603 contains the following statement prominently on the first page: “This is a supplement to health insurance. It is not a substitute for essential health benefits or minimum essential coverage as defined in federal law.”

(B) A summary description of each policy or certificate described in this section, including the average annual premium rates, or range of premium rates in cases where premiums vary by age, gender, or other factors, charged for the policies and certificates issued or delivered in this state.

(3) In the case of a policy or certificate described in this section and that is offered for the first time in this state for plan years on or after January 1, 2014, the carrier files with the commissioner the information and statement required in paragraph (2) at least 30 days prior to the date such a policy or certificate is issued or delivered in this state.

(b) As used in this section, “policies or certificates of specified disease” and “policies or certificates of hospital confinement indemnity” mean policies or certificates of insurance sold to an insured to supplement other health insurance coverage as specified in this section. An insurer issuing a “policy or certificate of specified disease” or a “policy or certificate of hospital confinement indemnity” shall require that the person to be insured is covered by an individual or group policy or contract that arranges or provides medical, hospital, and surgical coverage not designed to supplement other private or governmental plans.

article: 7. Preexisting Condition Provisions


text: The purpose of the chapter is to promote the public interest, to prevent unfair and unlawful health care business practices, and to promote adequate consumer and employer advance notice of changes in the cost and benefits of health coverage in order to allow for comparative shopping and to reduce the cost of health coverage.

history: (History: Added by Stats. 1990, Ch. 949, Sec. 2.)

article: 1. Purpose and Title

path: 2. CLASSES OF INSURANCE > 2. LIFE AND DISABILITY INSURANCE > 1.5. Health Coverage Contract Notification > 1. Purpose and Title


text:
(a) (1) An insurer or nonprofit hospital service plan or administrator acting on its behalf shall not terminate a group master policy or contract providing hospital, medical, or surgical benefits, increase premiums or charges therefor, reduce or eliminate benefits thereunder, or restrict eligibility for coverage thereunder without providing prior notice of that action. The action shall not become effective unless written notice of the action was delivered by mail to the last known address of the appropriate insurance producer and the appropriate administrator, if any, at least 45 days prior to the effective date of the action and to the last known address of the group policyholder or group contractholder at least 60 days prior to the effective date of the action. If nonemployee certificate holders or employees of more than one employer are covered under the policy or contract, written notice shall also be delivered by mail to the last known address of each nonemployee certificate holder or affected employer or, if the action does not affect all employees and dependents of one or more employers, to the last known address of each affected employee certificate holder, at least 60 days prior to the effective date of the action.

(2) The notice delivered pursuant to paragraph (1) for large group health insurance policies shall also include the following information:

(A) Whether the rate proposed to be in effect is greater than the average rate increase for individual market products negotiated by the California Health Benefit Exchange for the most recent calendar year for which the rates are final.

(B) Whether the rate proposed to be in effect is greater than the average rate increase negotiated by the Board of Administration of the Public Employees’ Retirement System for the most recent calendar year for which the rates are final.

(C) Whether the rate change includes any portion of the excise tax paid by the health insurer.

(D) How to obtain the rate filing required under Article 4.5 (commencing with Section 10181), including whether the rate change is attributable to changes in medical trend, utilization, or other factors.

(E) How to apply to the department to have the proposed rate reviewed by the department if a request is made within 30 days of the notice.

(b) A holder of a master group policy or a master group nonprofit hospital service plan contract or administrator acting on its behalf shall not terminate the coverage of, increase premiums or charges for, or reduce or eliminate benefits available to, or restrict eligibility for coverage of a covered person, employer unit, or class of certificate holders covered under the policy or contract for hospital, medical, or surgical benefits without first providing prior notice of the action. The action shall not become effective unless written notice was delivered by mail to the last known address of each affected nonemployee certificate holder or employer, or if the action does not affect all employees and dependents of one or more employers, to the last known address of each affected employee certificate holder, at least 60 days prior to the effective date of the action.

(c) A health insurer that declines to offer coverage to or denies enrollment for a large group applying for coverage shall, at the time of the denial of coverage, provide the applicant with the specific reason or reasons for the decision in writing, in clear, easily understandable language.

(d) (1) For group health insurance policies, if the department determines that a rate is unreasonable or not justified consistent with Article 4.5 (commencing with Section 10181), the insurer shall notify the policyholder of this determination. This notification may be included in the notice required in subdivision (a) or (b).

(2) The notification to the policyholder shall be developed by the department and shall include the following statements in 14-point type:

(A) The Department of Insurance has determined that the rate for this product is unreasonable or not justified after reviewing information submitted to it by the insurer.

(B) The policyholder has the option to obtain other coverage from this insurer or another insurer, or to keep this coverage.

(C) Small business purchasers may want to contact Covered California at www.coveredca.com for help in understanding available options.

(3) The development of the notification required under this subdivision shall not be subject to the Administrative Procedure Act (Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code).

(4) The insurer may include in the notification to the policyholder the internet website address at which the insurer’s final justification for implementing an increase that has been determined to be unreasonable by the commissioner may be found pursuant to Section 154.230 of Title 45 of the Code of Federal Regulations.

(5) The notice shall also be provided to the agent of record for the policyholder, if any, so that the agent may assist the purchaser in finding other coverage.

(6) In developing the notification, the department shall take into consideration that this notice is required to be provided to a small group applicant pursuant to subdivision (g) of Section 10181.3.

history: (History: Amended by Stats. 2019, Ch. 807, Sec. 14. (AB 731) Effective January 1, 2020.)

article: 2. General Provisions

path: 2. CLASSES OF INSURANCE > 2. LIFE AND DISABILITY INSURANCE > 1.5. Health Coverage Contract Notification > 2. General Provisions


text:
(a) The written notice described in subdivisions (a) and (b) of Section 10199.1 shall state in italics and in 12-point type the actual dollar amount and the specific percentage of the premium rate increase. Further, the notice shall describe in plain understandable English and highlighted in italics any changes in the plan design or change in benefits with reduction in benefits, waivers, exclusions, or conditions.

(b) The written notice shall specify in a minimum of 10-point bold typeface the reason or reasons for premium rate changes, plan design, or plan benefit changes.

history: (History: Amended by Stats. 2010, Ch. 661, Sec. 9. (SB 1163) Effective January 1, 2011.)

chapter: 1.5. Health Coverage Contract Notification

article: 2. General Provisions


text: There shall be no liability on the part of, and no cause of action of any nature shall arise against, any entity required to provide the notice or its authorized representatives, or agents, for any statement made, unless shown to have been made with malice in fact, by any of them in (a) any written notice or in any other oral or written communication specifying the reasons for the notice, (b) any communication providing information pertaining to such notice, or (c) evidence submitted at any court proceeding or informal inquiry in which such notice is at issue.

article: 2. General Provisions


text: Proof of mailing a notice and the reason therefor to the appropriate entity or individual at the last known mailing address shall be sufficient proof of the notice required by this chapter.

article: 2. General Provisions


text: The commissioner may, as conditions warrant, pursuant to Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code, adopt reasonable regulations, and amendments and additions thereto, as are necessary to administer this chapter.

article: 3. Administration and Enforcement

path: 2. CLASSES OF INSURANCE > 2. LIFE AND DISABILITY INSURANCE > 1.5. Health Coverage Contract Notification > 3. Administration and Enforcement


text:
(a) The commissioner shall have the administrative authority to assess penalties against insurers, nonprofit hospital service plans, administrators, and insurance producers, and other entities engaged in the business of insurance or other persons or entities for violations of this chapter.

(b) Upon a showing of a violation of this chapter in any civil action, a court may also assess the penalties described in this chapter.

(c) The commissioner may suspend or revoke the license or licenses issued to any production agent or administrator found, after notice and hearing, to have violated this chapter or a regulation adopted pursuant to the authority of this chapter. Notice of hearing shall be accomplished and a hearing conducted in accordance with Chapter 5 (commencing with Section 11500) of Part 1 of Division 3 of Title 2 of the Government Code, and the commissioner shall have all of the powers granted therein.

article: 3. Administration and Enforcement


text:
(a) Any production agent, administrator, or other person or entity engaged in the business of insurance, other than an insurer, who violates this chapter is liable for administrative penalties of not less than two hundred fifty dollars ($250) for the first violation.

(b) Any production agent, administrator, or other person or other entity engaged in the business of insurance, other than an insurer, who engages in practices prohibited by this chapter a second or subsequent time, or who commits a knowing violation of this chapter, is liable for administrative penalties of not less than one thousand dollars ($1,000) and not more than two thousand five hundred dollars ($2,500) for each violation.

(c) Any insurer who violates this chapter is liable for administrative penalties of not less than two thousand five hundred dollars ($2,500) for the first violation.

(d) Any insurer who violates this chapter with a frequency that indicates a general business practice, or commits a knowing violation of this chapter, is liable for administrative penalties of not less than ten thousand dollars ($10,000) and not more than one hundred thousand dollars ($100,000) for each violation.

article: 3. Administration and Enforcement


text: In addition to any other penalty provided by law or the availability of any administrative procedure, if an insurer, after notice and hearing, is found to have violated this chapter, or regulations adopted pursuant to this chapter, or knowingly permits any person to do so, the commissioner, in accordance with the procedures provided in Section 704, may suspend the insurer’s certificate of authority to transact disability insurance. Section 740.7 shall apply in any proceeding conducted pursuant to this section.

article: 3. Administration and Enforcement


text: This chapter applies to all master group policies and master group nonprofit hospital service plan contracts providing hospital, medical, or surgical benefits, regardless of policy or contract situs, coverage under which is solicited in any manner in this state.

article: 3. Administration and Enforcement


text:
(a) On or after January 1, 1994, every insurer issuing, amending, or renewing group disability insurance which covers hospital, medical, or surgical expenses shall notify the group policyholders in writing of the cancellation of the group policy and shall include in their contract with group policyholders, regardless of the situs of that contract, a provision requiring the group policyholder to mail promptly to each person covered under the group policy a legible, true copy of any notice of cancellation of the policy which may be received from the insurer and to provide promptly to the insurer proof of that mailing and the date thereof.

(b) The notice of cancellation required by subdivision (a) shall include information regarding the conversion rights of persons covered under the group policy upon termination of the group policy. This information shall be in clear and easily understandable language.

history: (History: Added by Stats. 1993, Ch. 1154, Sec. 2. Effective January 1, 1994.)

article: 2. General Provisions


text:
(a) On or after January 1, 1994, every nonprofit hospital service plan issued, amended, or renewed that covers hospital, medical, or surgical expenses on a group basis shall notify the group contractholders in writing of the cancellation of the plan contract and shall include in their contract with group contractholders a provision requiring the group contractholder to mail promptly to each subscriber a legible, true copy of any notice of cancellation of the plan contract which may be received from the plan and to provide promptly to the plan proof of that mailing and the date thereof.

(b) The notice of cancellation required by subdivision (a) shall include information regarding the conversion rights of persons covered under the plan contract upon termination of the plan contract. This information shall be in clear and easily understandable language.

history: (History: Added by Stats. 1993, Ch. 1154, Sec. 3. Effective January 1, 1994.)

article: 2. General Provisions


text:
(a) No health insurer shall, with regard to a group contract, change the premium rates or applicable copayments or coinsurances or deductibles for the length of the contract, except as specified in subdivision (b), during any of the following time periods:

(1) After the group policyholder or group contractholder has delivered written notice of acceptance of the contract or policy.

(2) After the start of the employer’s annual open enrollment period.

(3) After the receipt of payment of the premium for the first month of coverage in accordance with the contract or policy effective date.

(b) Changes to the premium rates or applicable copayments or coinsurances or deductibles of a contract or policy shall, subject to the insurer meeting the requirements of this chapter, be allowed in any of the following circumstances:

(1) When authorized or required in the group contract or policy.

(2) When the contract or policy was agreed to under a preliminary agreement that states that it is subject to execution of a definitive agreement.

(3) When the insurer and the policyholder or contractholder mutually agree in writing.

history: (History: Added by Stats. 2002, Ch. 336, Sec. 5. Effective January 1, 2003.)

article: 2. General Provisions


text:
(a) This section shall apply to grandfathered health insurance policies and nongrandfathered health insurance policies in the individual or small group markets that are issued, amended, or renewed on or after January 1, 2017.

(b) Notwithstanding paragraph (1) of subdivision (b) of Section 10199.48, a health insurance policy shall not change the cost-sharing design during the policy year, except when required by state or federal law.

(c) For purposes of this section, the following definitions shall apply:

(1) “Cost sharing” includes any copayment, coinsurance, deductible, or any other form of cost sharing by the insured other than the premium or share of premium.

(2) “Policy year” has the meaning set forth in Section 144.103 of Title 45 of the Code of Federal Regulations. For nongrandfathered health insurance policies in the individual market, “policy year” means the calendar year.

(3) “Cost-sharing design” means the amount or proportion of cost sharing applied to a covered benefit.

history: (History: Added by Stats. 2016, Ch. 192, Sec. 2. (SB 923) Effective January 1, 2017.)

article: 2. General Provisions


text: Any life insurer may issue life, disability, term, and endowment insurance on the group plan, with or without annuities, and with premium rates less than the usual rates for such insurance. Such insurance under a franchise agreement or upon a wholesale basis may be written under rates more or less than the usual rates for such insurance.

history: (History: Amended by Stats. 1961, Ch. 1385.)

chapter: 2. Group Life Policies

path: 2. CLASSES OF INSURANCE > 2. LIFE AND DISABILITY INSURANCE > 2. Group Life Policies


text:
An insurer may, in the discretion of the contracting parties, enter into a contract with a group policyholder or other contracting entity under any group, selected group, or franchise policy issued by the insurer to determine the amount the insurer may retain from premiums paid or to provide for the establishment of reserves or deposits to meet future contingencies of any nature under such insurance policy. Under this section, “contracting entity” means any of the following:

(a) The employer, association, trustee, union, or other entity to whom a group policy is issued.

(b) The organization to which an individual policyholder must belong or be associated with to be insured under a franchise or a selected group policy.

(c) Any entity formed and operating for purposes other than the procuring of insurance to which two or more contracting entities defined in subdivision (a) or (b) of this section belong.

history: (History: Added by Stats. 1967, Ch. 1194.)


text:
The term “franchise” or “wholesale” insurance shall mean a life insurance plan under which a number of individual life insurance policies are issued at special rates to a selected group. A special rate is any rate lower than the rate shown in the issuing insurance company’s manual for individually issued policies of the same type and to insureds of the same class.

After the effective date of this section no franchise or wholesale life insurance plan shall be entered into in this State unless the individuals to whom such insurance is made available are members of a professional association, employees of a common employer or affiliated employers, or unless the insurance is made available in connection with an indebtedness or a contract of sale. The word “employees” as used in this section shall be deemed to include the individual proprietors or partners who constitute the employer or affiliated employers.

In the case of any plan existing on or before the effective date of this section, any individual plan or policy then in effect shall not be changed or affected by this section, but no individual may thereafter become insured for more than twenty-five thousand dollars ($25,000), under any such plan except those written in connection with a professional association, an indebtedness, a contract of sale, or a pension plan. Nothing herein contained shall prevent any such plan so existing at the effective date hereof from being changed or modified (a) to change the insurer or insurers underwriting said plan and, to the extent necessary without affecting benefits payable, to make the plan conform to the underwriting rules and procedures of the new insurer or insurers; (b) to change rates applicable to insurance written under said plan; or (c) to add to said plan incidental benefits providing coverage on the lives of dependents of the insured individual, accidental death benefits or waiver of premiums during periods of total disability on the insured.

For purposes of this section a professional association means an association whose membership is restricted to one or more of the licensed professions such as medicine, dentistry, pharmacy, law and accountancy.

history: (History: Added by Stats. 1961, Ch. 718.)


text: The only forms of group life insurance are those set forth in this chapter.

history: (History: Enacted by Stats. 1935, Ch. 145.)


text:
Life insurance conforming to all the following conditions is one form of group life insurance:

(a) Written under a policy covering when issued not less than two public or private employees.

(b) Written under a policy issued to the employer, the premium on which is to be paid by the employer, by the employee, or by the employer and employees jointly, and insuring either all of the employees or all of any class or classes thereof, determined by conditions pertaining to the employment.

(c) For amounts of insurance based upon some plan which will preclude individual selection.

(d) For the benefit of persons other than the employer. That group insurance may be for the benefit of a trustee of a pension, welfare benefit plan, or trust established by an employer providing life, health, disability, retirement, or similar benefits to employees of the employer or its affiliates, and acting in a fiduciary capacity with respect to those employees, retired employees, or their dependents or beneficiaries, where the trustee has an insurable interest in the lives of the employees for whom those benefits are to be provided and where the employee has consented in writing to the coverage.

(e) When the premium is to be paid by the employer and employee jointly and the benefits of the policy are offered to all eligible employees.

(f) Terminating if, subsequent to issue, (1) the number of employees insured falls below two lives, and (2) the employee contributions, if the premiums for the insurance are on a renewable term insurance basis, exceed one dollar ($1) per month per one thousand dollars ($1,000) of insurance coverage plus an amount equal to any additional premium per one thousand dollars ($1,000) of insurance coverage charged to cover one or more hazardous occupations.

(g) The application period and the notice requirements shall be the same for classes of former employees and retired employees as those set forth in paragraphs (2) and (4) of subdivision (a) of, and subdivision (b) of, Section 10209.

That insurance may be issued either with or without medical examinations.

history: (History: Amended by Stats. 2018, Ch. 425, Sec. 1. (AB 1373) Effective January 1, 2019.)


text:
(a) The term “employees” as used in Section 10202 may include the officers, managers, and employees of subsidiary or affiliated corporations, and the individual proprietors, partners, and employees of affiliated individuals and firms, when the business of such subsidiary or affiliated corporations, firms, or individuals is controlled by the policyholder through stock ownership, contract or otherwise, or when the policyholder is controlled by affiliated corporations, firms, or individuals through stock ownership, contract or otherwise. The policy may provide that the term “employees” as used in Section 10202 may include classes of former employees, including retired employees, and may also include the individual proprietors or partners who constitute the policyholder, but limited to such individual proprietors and partners who are actively engaged in the business the employees of which are covered by the group insurance.

(b) This section does not permit any person other than an officer, manager, or employee for compensation, or classes of former employees, including retired employees, of the policyholder or of one or more of the individuals, firms, or corporations or of the individual proprietors or partners specified in subdivision (a) to become insured under a group policy.

history: (History: Amended by Stats. 2019, Ch. 497, Sec. 179. (AB 991) Effective January 1, 2020.)


text:
A group life policy conforming to all the following conditions may be issued to the trustees of a fund established by employer members of a trade association, or by a trade association maintained by contributions of such members for the sole benefit of their employees or, by one employer, or by two or more employers in the same industry, or by an association of employers in the same industry, or by one or more labor unions, or by one or more employers and one or more labor unions, or by an association of employers and one or more labor unions, to insure employees of the employers or members of the unions for the benefit of persons other than the employers or the unions:

(a) The persons eligible for insurance shall be all of the employees of the employers or all of the members of the unions, or all of any class or classes thereof determined by conditions pertaining to their employment, or to membership in the unions, or to both. The policy may provide that the term “employees” may include classes of former employees, including retired employees, and the individual proprietor or partners if any employer is an individual proprietor or a partnership. A director of a corporate employer is not eligible for insurance under the policy unless that person is otherwise eligible as a bona fide employee of the corporation by performing services other than the usual duties of a director. An individual proprietor or partner is not eligible for insurance under the policy unless the proprietor or partner is actively engaged in and devotes a substantial part of their time to the conduct of the business of the proprietor or partnership. The policy may provide that the term “employees” shall include the trustees or their employees, or both, if their duties are principally connected with such trusteeship.

(b) The premium for the policy shall be paid by the trustees either: (a) wholly from funds contributed by the employer or employers of the insured persons, or by the union or unions, or by both; or (b) partly from such funds and partly from funds contributed by either all of the insured persons or by one or more classes thereof, or (c) wholly derived funds contributed by the insured persons.

(c) The policy must cover at the date of issue at least 50 persons.

(d) The amounts of insurance under the policy must be based upon some plan precluding individual selection by the insured persons or by the trustees, employers, or unions.

That insurance shall be issued with or without medical examination. For the purpose of this section the word “industry” shall include licensed professions, such as medicine, dentistry, pharmacy, law, and accountancy.

history: (History: Amended by Stats. 2019, Ch. 497, Sec. 180. (AB 991) Effective January 1, 2020.)


text: The State and any political subdivisions thereof and any municipality, may provide for the type of insurance set forth in Section 10202.8 of this code the same as any private employer and may contribute to a fund established under such section the same as any private employer.

history: (History: Amended by Stats. 1957, Ch. 2255.)


text: The term “employees” as used in subdivision (a) of Section 10202.8 includes individual proprietors and partners of an employer which is an individual proprietor or partnership. The term “employer” as used in Section 10202.8 includes any self-employed member of a labor union whether or not there are persons employed by him.

history: (History: Added by Stats. 1959, Ch. 2097.)


text: A policy conforming to Section 10202.8 issued to a county may include as persons eligible, employees of a district located, wholly or partly, within such county. Such inclusion is subject to Section 53200.4 of the Government Code.

history: (History: Added by Stats. 1968, Ch. 935.)


text:
Life insurance conforming to all of the following conditions is another form of group life insurance:

(a) Written under a policy covering, when issued, not less than 25 members of any of the following:

(1) Any labor union or unions.

(2) The National Guard.

(3) Any association or governmental or public employees.

(4) Any credit union organized and operating under the Federal Credit Union Act of 1934 or Chapter 36 of the California Statutes of 1927 as amended.

(5) Any association of private employees of a common employer, formed for purposes other than obtaining insurance and having been in existence for two years or longer prior to issuance of the policy, and having a membership not less than 75 percent of the number of employees eligible for membership in such association.

(b) Written under a policy issued to one or more such unions, credit union or association.

(c) The premium on the policy to be paid by the union, credit union, or association or by the union or association and the members thereof jointly or by the insured members alone. Payment of such premium by a third party on behalf of the union member shall be considered payment by the union member.

(d) Insuring only members of such union or unions or members of such credit union or association.

(e) Insuring for amounts of insurance based upon some plan which will preclude individual selection.

(f) Insuring for the benefit of persons other than the union, credit union or association or its officials.

(g) Written under a policy insuring, when issued, not less than 75 percent of all members eligible for insurance under the policy, or 75 percent of such members of any class thereof reasonably determined by conditions pertaining to employment or of any established unit thereof not formed for the purpose of procuring insurance; provided, that if a group policy is intended to insure several such classes or units it may be issued as respects any such class or unit of which 75 percent are covered and extended to other such units or classes as 75 percent thereof express the desire to be covered. In such case, when members apply and pay for additional amounts of insurance, a smaller percentage of members may be insured for such additional amounts of insurance. If any member fails to become insured under an existing policy when he becomes eligible and later wishes to become insured thereunder, the insurer may require satisfactory evidence of insurability before insurance is granted on such member.

(h) No policy of group life insurance shall be issued to an association of private employees of a common employer unless the employer consents in writing to deduct premiums from wages or salary of insured members.

(i) Written under a policy covering any association having a constitution and bylaws and formed and continuously maintained in good faith for purposes other than that of obtaining insurance, offering insurance to all the eligible members of such association and covering not less than 25 such members or such members together with their dependents or spouses and not less than 75 percent of all eligible members for amounts of insurance based upon some plan which will preclude individual selection by the member as to the amount of his or her insurance coverage thereunder. If the master policy is to be issued to cover members of labor unions, it may be issued to more than one such union.

history: (History: Amended by Stats. 1981, Ch. 735, Sec. 2.)


text:
Life insurance conforming to all the following conditions is another form of group life insurance:

(a) Written under a policy covering, when issued, not less than 25 employees of the Trustees of the California State University in eligible classes as designated by the trustees pursuant to Section 89506 of the Education Code.

(b) Written under a policy issued to the Trustees of the California State University pursuant to Section 89506 of the Education Code.

(c) The premium on the policy is to be paid by the employees alone, or in part by the State of California, with the remainder to be paid by the employees. Payment of the premium by a third party on behalf of the employees shall be considered payment by the employees.

(d) Insuring only the employees of the Trustees of the California State University.

(e) Insuring for amounts of insurance based upon some plan which will preclude individual selection.

(f) Insuring for the benefit of persons other than the Trustees of the California State University.

(g) Written under a policy insuring, when issued, not less than 75 percent of all such employees eligible for insurance under the policy, or 75 percent of the employees of any class thereof reasonably determined by conditions pertaining to employment or of any established unit thereof not formed for the purpose of procuring insurance. However, if a group policy is intended to insure several classes or units, it may be issued as respects any class or unit, of which 75 percent are covered and extended to other units or classes as 75 percent thereof express the desire to be covered. In such case, when the employees apply and pay for additional amounts of insurance, a smaller percentage of employees may be insured for additional amounts of insurance. If any employee fails to become insured under an existing policy when he or she becomes eligible and later wishes to become insured thereunder, the insurer may require satisfactory evidence of insurability before insurance is granted on the employee.

history: (History: Amended by Stats. 1983, Ch. 143, Sec. 200.)


text:
Life insurance conforming to all the following conditions is another form of group life insurance:

(a) Written under a policy covering, when issued, not less than 25 employees in eligible classes or positions as designated by the Department of Human Resources pursuant to Section 19849.11 of the Government Code.

(b) Written under a policy issued to the State of California through the Department of Human Resources or its designee pursuant to Sections 19849.10 to 19849.12, inclusive, of the Government Code.

(c) The premium on the policy is to be paid by the employees alone, by the state alone, or in part by the state with the remainder to be paid by the employees.

(d) Insuring only managerial and confidential employees as defined by subdivisions (e) and (f) of Section 3513 of the Government Code, and employees excluded from the definition of state employees in subdivision (c) of Section 3513 of the Government Code.

(e) Insuring for amounts of insurance based upon some plan which will preclude individual selection.

(f) Insuring for the benefit of persons other than the Department of Human Resources or its designee.

(g) Written under a policy insuring, when issued, not less than 75 percent of all employees eligible for insurance under the policy, or 75 percent of the employees of any class or position thereof reasonably determined by conditions pertaining to employment or of any established unit thereof not formed for the purpose of procuring insurance. If a group policy is intended to insure several classes, positions, or units, it may be issued as respects the classes, positions, or units of which 75 percent are covered and extended to those other units, classes, or positions of which 75 percent express the desire to be covered. In this case, when the employees apply and pay for additional amounts of insurance, a smaller percentage of employees may be insured for the additional amounts of insurance. If any employee fails to become insured under an existing policy when he or she becomes eligible and later wishes to become insured thereunder, the insurer may require satisfactory evidence of insurability before insurance is granted on the employee.

history: (History: Amended by Stats. 2012, Ch. 665, Sec. 172. (SB 1308) Effective January 1, 2013.)


text:
(a) Insurance under a group life insurance policy issued pursuant to Sections 10202, 10202.8, 10203, 10203.1, and 10203.7 may be extended to insure the dependents, or any class or classes thereof, of each insured employee who so elects, in amounts in accordance with some plan that precludes individual selection and that shall not be in excess of 100 percent of the insurance on the life of the insured employee. For dependent children over the age of majority, the group policyholder may elect coverage at age variations up to the limiting age.

(b) “Dependent” includes the member’s spouse or a minor child, as well as a child older than the age of majority up to a maximum of 26 years of age, or any child over the age of majority who is both incapable of self-sustaining employment by reason of an intellectual disability or physical handicap and chiefly dependent upon the employee for support and maintenance if proof of the incapacity and dependency is furnished to the insurer by the employee within 31 days of the child’s attainment of the limiting age and subsequently as may be required by the insurer, but not more frequently than annually after the two-year period following the child’s attainment of the limiting age.

(c) The premiums for the insurance on the dependents may be paid by the employer, the employee, or the employer and the employee jointly.

history: (History: Amended by Stats. 2016, Ch. 440, Sec. 1. (AB 565) Effective January 1, 2017.)